1. Branding Continued…
Dr. Cara Peters
BADM 672D

2. 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

3. 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

4. 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

5. 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?

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