Branding Continued… Dr. Cara Peters BADM 672D

Brand Extensions Take equity of the brand and use it in another context Advantages: Save money, instant recognition, more easily build market share Normal new brand introduction costs: $50 million - $1 billion for a large firm May rejuvenate old brand General Mills example

Brand Extensions Works well for brands with higher emotional connections Built on personality, values, etc. Keys to success Compelling brand proposition in new category Sufficient competence in new category “Fit” of brand in new category

Brand Extensions Risks: Least risky: related product in same market Failure of new product may hurt brand Lose focus of brand Damage perceptions of brand Cannibalization Least risky: related product in same market Most risky: unrelated product in new market Honda= Cars vs. Jeep=Luggage

Ask Yourself What does your brand stand for in the mind of the consumer? What could you potentially make it stand for? In what markets would your brand profile match the needs of consumers? Are those segments attractive? Could you have leading edge competence in those markets?

Co-branding & Ingredient Branding A partnership between two brands: HPiPaQ Ingredient branding Inclusion of one brand within the other: Intel