Why Is Brand Extension Important
Brand extension is a strategic move that companies use to expand their brand identity beyond their core products or services. It's a powerful tool that can help businesses establish a stronger foothold in their industry and build deeper connections with their customers. We'll explore the importance of brand extension and provide tips on how to do it right.
What Makes Brand Extension Essential?
Brand extension allows companies to leverage the equity they have built in their core products or services and extend that equity to new products or services. This can be a powerful way to build brand awareness, increase market share, and create new revenue streams.
For example, Apple has extended its brand beyond its core products (computers, smartphones, and tablets) to include products like the Apple Watch and AirPods. By leveraging the strength of its brand, Apple has been able to establish a dominant position in the wearables market and create new revenue streams.
Types of Brand Extension
There are several types of brand extension that companies can use to expand their brand identity. These include:
Line extension: This involves introducing new products or services within the same product category. For example, Coca-Cola has introduced several line extensions, including Coca-Cola Cherry and Coca-Cola Zero.
Category extension: This involves introducing new products or services in a different product category. For example, Dove has extended its brand from soap to deodorant and shampoo.
Brand partnership: This involves partnering with another brand to create a new product or service. For example, Nike and Apple partnered to create the Nike+iPod Sports Kit.
Co-branding: This involves using two brand names on a single product or service. For example, the partnership between KFC and Pizza Hut that created the KFC Chicken Pizza.
How to Do Brand Extension Right
To do brand extension right, companies need to follow a few key steps:
Step 1: Understand your brand's equity. Before extending your brand, you need to have a deep understanding of your brand's equity. This includes your brand's reputation, customer perception, and market position.
Step 2: Identify opportunities for extension. Once you have a deep understanding of your brand's equity, you can start to identify opportunities for brand extension. This could involve introducing new products or services, entering new markets, or partnering with other brands.
Step 3: Evaluate the fit. Before extending your brand, you need to evaluate the fit between your brand and the new product or service. This includes considering factors such as customer perception, market position, and brand values.
Step 4: Develop a brand extension strategy. Once you have identified opportunities for brand extension and evaluated the fit, you can develop a brand extension strategy. This should include a clear vision for how the brand extension will fit into your overall brand identity and marketing plan.
Step 5: Launch and promote. Once you have developed a brand extension strategy, you can launch and promote your new product or service. This should include a comprehensive marketing plan that leverages your existing brand equity and communicates the benefits of the brand extension to your target audience.
Brand extension is a powerful tool that can help businesses expand their brand identity, increase market share, and create new revenue streams. By following the steps outlined in this blog post, you can develop a successful brand extension strategy that leverages the equity you have built in your core products or services and strengthens your overall brand identity.