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Marketers should keep the following in mind when considering brand extensions.

Successful brand extensions – a few examples

• Jello (pudding, pudding snacks)
• Crayola (markers, pens and paints)
• Dole (pineapple juice, fruit juice, fruit salad, frozen fruit bars with fruit juice)
• Ivory (soap, washing-up liquid, mild detergent)
• Woolite (textile laundry, carpet cleaner spray)
• Arm & Hammer (toothpaste, deodorant, detergent)

Question: For each brand, what was the transferable core brand association that enabled successful expansion?

Unsuccessful brand extensions – a few examples

• Bic perfume (using the association “small disposable bags” ???)
• Levi’s Bespoke Classic Suits – What is Levi’s Main Association? (Casual wear)
• Campbell’s Spaghetti Sauce – Why wasn’t “Tomato Sauce” carried over from Campbell’s soups to spaghetti sauce?
• McDonald’s Arch Deluxe (Adult) – What is McDonald’s Federation? (Fast food for children)
• Bayer “Aspirin-free” – What is the Bayer Association? (Aspirin)
• Volvo 850 GLT Sport Sedan – What is the Volvo Federation? (Security) What is a primary point of evidence? (box-shaped armored car styling)
• Or an all-time favorite, New Coke (What is Coke? “It’s the real thing” with its long-standing secret formula.)

The most common problems with brand extensions

• Expansion into a category in which the brand does not add anything other than its identity (its products or services are not significantly different from the current products or services in the category)
• Expansion through opportunistic brand licensing without considering the impact on the brand
• Expansion to lower (and sometimes higher) quality segments
• Do not fully understand ownership, transfer, or meaning of brand benefits

Overstretching brands

We asked Branding Strategy Insider readers: “When is a brand overstretched? How does it look like? What are early warning signs? “Some of them said:

• A brand is overwhelmed when its iterations are no longer valid for its customers.

• When is a brand overstretched? Brand overexpansion occurs when the identity of a brand does not trigger an emotional reaction – which turns into a desire to buy – from the public. Furthermore, brand overstretching is the result of a brand’s inability to evoke a clear understanding of how the product works in the public mind. When I see a well-done Coke commercial, it reminds me that I haven’t had a Coke in a while – not just some ‘Ole Soda’.

• How does it look (brand overstretching)? Brand exaggeration looks like an underrated product. A product that is everywhere but undervalued is being overdone. When the public rejects the function of the product, the product becomes as unique as dirt.

• What are early warning signs? Editors abuse trademarks by allowing the words Kleenex and Xerox to be used as nouns instead of adjectives. When editors disregard your identity, they teach the masses to disregard your product.

• A brand is overwhelmed if its employees cannot immediately and concisely say what it stands for.

• A brand is overwhelmed if you can only say: “It is a quality innovation leader in the categories in which it operates. It offers its customers security. “

• A brand is overused when for-profit businesses have the freedom to move into new categories with the brand name without any mechanism to monitor brand value intervening and being directed.

• You know you are in trouble when the person running your branding licensing department does not have a strategic bone in their body and is mostly compensated for the extra profits they or she makes.

According to Peter Farquhar, successful brand extensions have three characteristics:

1. Perceptually appropriate fit: The consumer must perceive the new article as conforming to the parent brand.
2. Advantage transfer: An advantage offered by the parent brand must be desired by consumers of products in the new category.
3. Competitive advantage: The new articles have to stack up favorably against established articles in the new category.

Sometimes a brand extension is just further evidence of the brand promise and reinforces what the brand stands for. At other times, it increases the brand’s relevance to new customer segments. Sometimes it can expand the brand’s meaning beyond a certain product category, giving it a longer lifespan and greater flexibility for future growth.

The Blake Project can help you determine whether licensing is the right expansion strategy for your business

Branding Strategy Insider is a service from The Blake Project: A strategic brand consultancy specializing in brand research, brand strategy, brand growth and branding

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