This document discusses brand extension, which is using an established brand name to launch a new product in a different category. It provides examples of successful and unsuccessful brand extensions. Specifically: - Brand extensions can be line extensions that target new market segments within a category, or category extensions that enter a new product category. - Successful brand extensions like Fabindia were able to leverage trust in the parent brand while expanding product lines. - Unsuccessful extensions like Pond's oral care failed because consumers did not associate attributes of the parent brand like fragrance with the new category of toothpaste. Extending too far can damage a brand if the new product is not a good fit.

1. FARSANA
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2. Brand extension
“Brand extension is using the leverage of a well known brand name in one
category to launch a new product in a different category”
0 A brand extension occurs when a firm uses an established brand name
to introduce a new product.
0 When a new brand is combined with an existing brand, the brand
extension also be a sub-brand. An existing brand that gives birth to a
brand extension is the parent brand. If the parent brand is already
associated with multiple products through brand extensions, then it may
also be called a family brand.

3. Two general categories
 LINE EXTENSION
Marketers apply the parent brand to a new product that targets a new
market segment with in a product category the parent brand currently
serves. A line extension often adds a different flavor or ingredient variety, a
different form or size or a different application for the brand.
 CATEGORY EXTENSION
Marketers apply the parent brand to enter a different product category
from the one it currently serves.

4. Top brand extensions of 2013
0 Titan Skin Perfumes
0 Parle Café Cuba
0 McCafe
0 Park Avenue Beer Shampoo
0 MTV Helmets
0 Dove Elixir
0 Woodland skincare and equipment
0 Google Eye Glass
0 NIKE Eye Glass, Golf Equipment

5. Advantages of brand extension
 It makes acceptance of a new product easier.
0 It increases brand image.
0 The risk perceived by the customer reduces.
0 Advertising, selling and promotional costs are reduced. There are
economies of scale as advertising for core brand and its extension reinforces
each other.
0 Cost of developing new brand is saved.
0 The expense of introductory and follow up marketing programs is reduced.

6. Advantages of brand extension
 Consumer knowledge: The remaining strong brand used to “promote a new
product” makes it less critical to create “awareness and imagery”.
 Consumer trust: The existing well-known-strong brands represent a promise
–of quality, useful features etc. - for the consumer. A satisfied customer by an
extension will be more willing to repurchase the same brand.
 Defensive strategy: An extension can prevent competitors from gaining or
exploiting a foothold in the market and can be “worthwhile even though it might
struggle”.

7. Disadvantages of brand extension
 Brand extension in unrelated markets may lead to loss of reliability if a
brand name is extended too far. An organization must research the
product categories in which the established brand name will work.
 There is a risk that the new product may generate implications that
damage the image of the core/original brand.
 There are chances of less awareness and trial because the management
may not provide enough investment for the introduction of new product
assuming that the spin-off effects from the original brand name will
compensate.

8. Disadvantages of brand extension
If the brand extensions have no advantage over
competitive brands in the new category, then it will fail.
 Cannibalization: extensions can cannibalize the existing
products of the brand when there are positioned in a close
market. It means the extensions sales are increasing while
those of the existing brand’s products are following the
Opposite curved.

9. Success story

10. FABINDIA
0 In 1958, Bissell discovered was a village-based industry with a
profusion of skills hidden from the world.
0 Determined to showcase Indian handloom textiles while providing
equitable employment to traditional artisans, Bissell established
Fabindia in 1960 in order to fuse the best aspects of East/West
collaboration.
0 Fifteen years later the first Fabindia retail store was opened in Greater
Kailash, New Delhi with a range of upholstery fabrics, durries and home
linens. By the early eighties, they started producing garments made
from hand woven and hand block printed fabrics.

11. FABINDIA
0 Over the years the focus of Fabindia’s marketing shifted from exports to the local
Indian retail market. What started as an export house has today become a
successful retail business presenting Indian textiles in a variety of natural fibers,
and home products including furniture, lights and lamps, stationery, home
accessories, pottery and cutlery. Extending this partnership to the farmers in
rural areas, Fabindia launched its organic food products range in 2004. Fabindia
Sana, the company’s authentic body care products range is also being launched at
all Fabindia outlets.
0 Today they have retail outlets in all major cities of India – 85 at last count – in
addition to international stores in Rome, Italy; Dubai, UAE and Guangzhou, China.

12. Failure story

13. PONDS
0 The first Pond's product was created in 1846, since then the brand has
flourished in Unilever's fifth most profitable Personal care property
globally. In 1886, Pond's was re launched as Pond's Extract and in 1914
Pond's Cold Cream and Vanishing Cream marked the brand's evolution
to a beauty icon. By the mid 1920s it was reflecting this positioning with
endorsements by princesses, Hollywood stars and society beauties. Its
stylish image was underpinned by guarantees of product delivery and an
understanding of woman's beauty routines and needs.

14. PONDS
0 By the twentieth century, the company's main strategy
was geared towards selling cosmetics products, and so
the "Pond's Vanishing Cream" and the "Pond's Cold
Cream" were created, marking the entrance of Pond's
products into the facial care industry. Today Ponds is sold
around the world. Its strengths are in Spain, India, Japan
and Thailand.

15. 0 Popular brand of face cream and powder
0 Extended to Oral care
0 .In a blind test environment, people were not able to differentiate
‘Ponds’ toothpaste from that of ‘Colgate’.
0 To consumers the brand Ponds was nothing but fragrance & a consumer
product for external application only; this did work brilliantly with soaps &
creams however the attributes for toothpaste are taste. consumers thus when
Ponds ventured into oral health care, it was ignored. Consumers simply
refused to acknowledge its presence leading to a sudden but painful death of
a brand

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