A horizontal brand extension is when a brand name is applied to a new product or service in either a related product class or in a product category completely new to the firm, for example FHM Magazine launching a credit card.
What are the advantages of brand extension
Advantages of Brand Extension It increases brand image. The risk perceived by the customers reduces.
The likelihood of gaining distribution and trial increases. An established brand name increases consumer interest and willingness to try new product having the established brand name.
What are the limitations of brand extension
Extending the brand name too far may lead to a loss of reliability, especially if the brand extension happens in an unrelated market.
Thus, companies have to know which product categories will work and where they can actually use the brand name.
How many categories of extensions are there
There are four types of hair extensions, according to Rauchet: tape-in, clip-in, bonded, and halo hair extensions.
And while they all share one common goal—creating long, luxurious hairstyles—they’re all different in terms of application, texture, and longevity.
Consider the following breakdown.
What are types of brand extension?
- Product extension
- Line extension
- Customer franchise extension
- Company expertise extension
- Brand distinction extension
- Transfer of component extension
- Leveraging a lifestyle extension
What are the benefits of brand extensions
Advantages of Brand Extension The risk perceived by the customers reduces. The likelihood of gaining distribution and trial increases.
An established brand name increases consumer interest and willingness to try new product having the established brand name.
The efficiency of promotional expenditure increases.
Are brand extensions an important brand growth strategy
A robust brand extension strategy is essential to prosper and maintain relevance in today’s hyper-competitive marketplace.
In some ways, brand extension represents the most efficient and logical way to achieve profitable brand growth, yet many companies struggle with how far to stretch.
Why is category extension important
Brand extensions can also benefit the parent brand by creating a greater sense of loyalty, reaffirming the brand promise and consumer perceptions of the brand, and sustaining the parent brand’s relevance in its existing category.
Extensions can also help to establish a brand’s position in new categories.
What is product life extension
“Product life extension” is a concept developed as one of the multifaceted solutions to create a circular economy.
The basic concept describes how long a product or item can be used for, with the ultimate goal of maximizing any given product’s “utilization” rate and duration.
What are the components of brand extension
A comprehensive literature review identifies six elements which are crucial to the success of brand extension.
These elements are Parent Brand Image, Parent Brand Fit, Parent Brand Strength, Marketing Support, Quality of Parent Brand and Parent Brand Consumer Experience.
What is product line extension example
A product line extension is when an existing brand launches new products in a product category they already offer products within.
For example, when a soft drink company offers a new flavor of soda.
What are survival strategies in business?
- Diversification
- Cutting costs
- Stay on top of compliance
- Increasing revenue
- Always go the extra mile
- Plan Bs
What is a product line strategy
A good product line strategy guides managers to improve their product line’s total performance.
It creates a focus on the whole line, not just products independent of one another.
And the focus also sets a course to avoid disjointed decisions, actions, and investments that may impact the line’s performance negatively.
What is the difference between brand extension and brand stretching
Brand stretching involves introducing a new product into the market that is similar to an existing product in terms of functional benefits, but different in terms of price or branding.
Brand extension involves introducing a new product that has little or no relationship with the original brand and its customers.
Why do companies use product line extensions
Brand Extensions Increase Customer Loyalty By choosing to offer additional offerings in the same category, you’ll give customers more opportunities to purchase your products as opposed to buying from one of your competitors.
Why do brand extensions fail
When brand extensions fail, it’s usually because companies try to borrow or milk their brands, and/or they simply do not pay enough attention to creating sufficient new consumer benefits.
What are the principles of good strategy?
- Aim High
- Build on Your Strengths
- Be Ambidextrous
- Clarify Everyone’s Strategic Role
- Align Structures to Strategy
- Transcend Functional Barriers
- Become a Fully Digital Enterprise
- Keep It Simple, Sometimes
How do you create a brand extension?
- Survey your brand equity
- Set your goals
- Review your resources
- Look into wider consumer or market trends
- Research your competitors
- Engage with your existing customers
- Narrow down your options
- Get to know your new target market
What is an example of a failed brand extension
Colgate Kitchen Entrees. The idea was that after a delightful Colgate meal, you could then brush your teeth afterwards using, yes, Colgate toothpaste.
This brand extension was such a disaster that it never left US soil. The problem Colgate is not a brand name one would associate with a hot meal after work.
What are the disadvantages of line extension
Challenges of a product line extension The challenges of a product line extension include: Potential product cannibalization Minor increases in sales volume Cluttering or confusing the market Less efficiency of production and marketing Unresponsive retail channels Potential product cannibalization A product line
What are the 4 main factors that influence a business pricing strategy Seneca
Marketing’s four Ps – product, price, promotion and placement – are the basic components of any marketing mix.
The decisions you make with regard to all of these elements can mean the difference between success and failure.
At which stage extension of the product life cycle should be considered
If the firm decides to continue selling the product as it reaches saturation or enters the decline phase, it is likely to extend the life of the product by changing aspects of the marketing mix to rejuvenate the offer.
What is brand extension trap
This tactic is undertaken due to the brand loyalty and brand awareness associated with an existing product.
Consumers are more likely to buy a new product that has a reputable brand name on it than buy a similar product from a competitor without a reputable brand name.
Which of the following company is an example of line extension
There are two types of line extensions: Horizontal (same price/quality) and Vertical line extensions (different price/quality).
Horizontal Line Extension Examples: Coca-cola with cherry flavor.
What is a transfer strategy
Transfer strategies are designed for business owners who have a current need to transfer the ownership of their business.
These strategies provide a means to meet a business’ capital transfer needs.
What is line extension trap
If you follow the prevailing logic of most modern companies, you will inevitably fall into this trap.
Line extension is using an existing brand name or image and extending it to new products.
Sounds like a good idea, right? Why not use the equity of your known brand to draw attention to a new product?
What is new brand strategy
The new brand strategy means developing a new product line and a brand that would be associated with it.
The product line needs to be outside the scope of the current brand offering, that’s why it requires a new brand.
How does Coca Cola use brand extension
This brand is best known for its original coke taste, but using brand extension, Coca-Cola has launched a whole new line of various coke products, such as Coke Zero and Cherry Coke flavor.
When exploring brand extension, this can also mean completely unrelated product lines compared to the original product.
Does Nike use brand extension
Nike implements a mixture of brand and product line extensions to expand its market reach and increase sales.
Nike’s Air Force 1, Cortez, Metcon 5, and React Infinity Run are results of product line extensions.
What are the four basic pricing strategies
What are the 4 major pricing strategies? Value-based, competition-based, cost-plus, and dynamic pricing are all models that are used frequently, depending on the industry and business model in question.
Sources
https://adept-plm.com/what-is-a-product-line-strategy/
https://www.michaeldaehn.com/articles/how-to-avoid-the-line-extension-trap.html
https://www.campaignlive.co.uk/article/starbucks-drops-coffee-logo-eyes-brand-extensions/1047988
