Launching new products and services under (or linked to) an existing brand, if done properly, significantly decreases perceived customer risk and increases product/service acceptance, all at a fraction of the cost that it would have taken to launch a new brand. In addition to generating incremental revenue and profit for your brand, brand extensions can be beneficial in the following ways:
• helping to clarify and broaden brand meaning to consumers (for instance, extending Hallmark into candy and flowers may help redefine the brand, expanding it from “greeting cards” to “ways to show you care.”)
• reinforcing and building upon key brand associations
• extending the brand’s reach and relevance to new consumers
• creating brand “news”/”buzz”
• laying the groundwork for future extensions
Risks of brand extension include the following:
• creating confusion regarding brand meaning
• tarnishing the quality image
• conflicting with or counteracting key brand associations
• creating new, undesired brand associations
• “turning off” current key consumer segments
• if done in great excess with no focus, completely diluting brand meaning and overexposing the brand in the market place
These past few weeks clients have prompted us to spend more time on this topic. I’ve touched on it here and will share more later in the week.
The Blake Project Can Help: The Brand Licensing Audit and The Brand Licensing Workshop
Branding Strategy Insider is a service of The Blake Project: A strategic brand consultancy specializing in Brand Research, Brand Strategy, Brand Licensing and Brand Education
