Branding strategies for brand extension, Study notes of Brand Management

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Dr. Shikha Gupta Assistant Professor Department of Fashion Management Studies NIFT Jodhpur

§ A thorough understanding of branding strategy § Market size to recoup the expenditures incurred in the initial phases of establishing a brand § Extent of competition prevailing in the market § Resources at the disposal of the firm § Product uniqueness and focus on brand’s distinctive features

Company Brand Market Position Procter & Gamble Ariel Detergent High tech detergent Tide Detergent Whiteness no other can deliver Pantene Shampoo Healthy and Shiny Hair Head & Shoulders Shampoo Dandruff Shampoo Camay Soap Cream soap Whisper Sanitary Napkin Hygenic Protection Vicks Balm Clear blocked nose by touch theraphy Old Spice After Shave Sign of manliness HLL Lux Soap Toilet soap of film stars Lifebuoy Soap Fights germs Rexona Soap Gentle soap with natural oil Liril Soap Freshness soap Surf Detergent powder Up market detergent Wheel Detergent Mass economy Sunsilk Shampoo Position of a beauty soap Clinic Shampoo Makes hair soft and lustrous, preventing dandruff. Vitamin nourishment

§ Product brands are uniquely positioned and directed at a segment § Product branding allows a brand to acquire differentiation § Product Branding allows a Company to venture into unrelated areas of activity § Appreciating brand differences is much easier when product branding is followed § Product branding has an effect of making the firm innovative and risk free § Product brand avoids confusion in the market

§ A well cultivated brand can be extended to include a host of related products under a common concept. § It fulfills all complementary needs that surrounded a basic need. § Marketing products as a line under a common brand improves the brand’s marketing power rather than selling as individual brands. § The firm promotes the main product and its concept. Complementary products do not require additional investment. So, the brand could be extended without much costs. § Line brands as a complete team reinforce and strengthen the brand concept among its users.

§ This strategy looks to target the customer rather than market penetration. § As the launch of complementary products is easy, marketers may be tempted to launch too many related products. This may ultimately result in over extension of the line. § Over extension of the line may potentially weaken the brand instead of strengthening it.

§ Formation of brand equity is the very important advantage of range branding. Products under range branding share a common name. Brand building efforts do not get dissipated. § Other new products which are consistent with the brand can easily be held in the embrace of range branding. § As a result, cost of introducing a brand in the marketplace is less. § The Ayurvedic concept for example is passed on to new products which share its idea at lower expenditure.

§ The most important drawback is that when range branding embrace too many products, the meaning of the concept may get diffused. § Over stretching weakens the brands.

§ Economical strategy. § Investing in a single brand is less costly than building a number of brands. The brand distributes its investment over a number of products. § Once an umbrella brand becomes popular it bestows the new products brand awareness and instant goodwill. § New products inherit all the advantages of the umbrella name. § In the days of brand proliferation, umbrella branding makes more sense. Simply by sheltering under the umbrella brand, new products get easy recognition.

§ Umbrella brand may not succeed in a niche market where specialization is needed. § Many products share the common name. So, the failure of one product may affect the others sheltered under the umbrella. § Difficult to stretch vertically. For example, prestige brands (like Omega) in the upper segment cannot easily stretch to lower end. § Vertical extensions are likely to damage the core brand. However horizontal extensions are less harmful.

§ Product or service brands linked together by an endorsing brand. § The product/service brands and the endorsing brands will each have their own brand attributes, including a name, logo, brand promise, position and personality. § The product/service brands will have each have their own brand marketing and will need to rely on their own value propositions to succeed. § Despite the distinctness of each product brand, the essential ingredient for a successful endorsing brand architecture is that there is a link between (i) the higher-level brand promise of the endorsing parent brand and (ii) the product brand. § This link is what provides the assurance to the customer that if they like one product in the family of the endorsing brand, then a sibling brand is also worthy of consideration.

§ For brands with large portfolios built on a key innovation or set of innovations, an endorser brand architecture can be a good alternative to a master brand architecture. Brand marketing which promotes the endorsing parent brand provides a boost to each product brand. § An endorser brand architecture allows a high degree of brand marketing freedom for each product brand. § Product managers, marketers and internal leadership often favour having the freedom to create distinctive brand strategy, name, logo, design, creative campaigns and messages. § The link between product brands can assist in cross-selling.

§ Source or double branding strategy combines the firm’s name with the product brand name. It is the hybrid of umbrella brand and product brand strategy. The product is given a brand name and is combined with the name of the firm. § For example, Chetak is the name of the scooter and Bajaj is the company behind it, the brand accordingly becomes Bajaj Chetak. § Both names are given equal status and enjoy equal importance in the brand’s communication. Firms that follow double branding include Maruti(Maruti 800, Maruti Zen, Maruti Baleno), Bajaj (Bajaj sapphire, Bajaj pulsar), etc. § Source branding by combining a firm’s name with product name seeks to achieve two objectives. First, the firm’s name brings its equity to the product. The product stands to benefit from what the company has been able to cultivate in terms of awareness expertise, attribute and reputation associations. When Bajaj name is added to a new brand like Legend, immediately Bajaj’s, and repertoire of associations are transferred onto one product. Secondly, the second name, the name of the product (e.g. Legend) provides the chance to add something unique to the brand the brand. This is an opportunity for customization and personalization. That is, the brand can stand for something over and above what Bajaj stands for. The brand can acquire its own image in the broad framework of corporate image. This way the brand can reach new consumer groups or market segments. § Double branding is somewhat an extension of the umbrella strategy. Each brand tends to share something common- the identity and image of the source company behind the brands.

§ This is very close to umbrella brand strategy with one exception every product has a different brand name under the source name. § This is a two-tiered structure with double branding. Most of the Japanese cars are examples of the source brand strategy. § One product starts and gets sub-divided into sub-species giving them different names. § Different names are given to different products to fulfil different promises. § Each product with a different name carries one specific contract. The power of the source supports the offspring until they become established brands in their own right. § The sub-brands/offspring become so strong owing basically to strength of the source that a point comes when the source takes the back seat and offspring emerge as the main brands because of their own promise. Eg. In Japanese cars, only to the logo of the source brand can be seen, because the offspring have developed a strong identity of their own. § The family spirit dominates! Toyota and Honda are excellent examples of this strategy. And, there are many more.