brand extension

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Brand Extension

The act or practice of adding a new product under the same brand name. This allows a company to introduce a new product without having to build up a whole new customer base for it. For example, when Jimmy Dean introduces a new flavor of sausage, it may put the Jimmy Dean name and logo on the wrapping. This is intended to encourage people who like other Jimmy Dean sausages to view the new flavor favorably and be more inclined to buy it.

brand extension


brand transference

the use of an existing BRAND for new or modified products. Where the new product is in a significantly different category this is called ‘brand stretching’. Brand extension seeks to capitalize on consumer awareness of and loyalty towards a firm's established brands in order to gain rapid consumer approval and acceptance of the new or modified product.

Where a modified product simply serves another segment of the same market the term brand extension is generally used (see MARKET SEGMENTATION). The term brand transference is used where an established brand name is associated with a new product serving a different market. For instance, the manufacturer of a well-known vacuum cleaner might use that brand name to launch a new product in some other market, for example washing machines. See PRODUCT POSITIONING.

References in periodicals archive ?
Brand extension has been defined as a strategy whereby an established brand name is used to launch a new product and which is crucial in enhancing brand value and equity (Volckner & Sattler, 2006, p.
Nature resorts has been inspired by the Emirates One&Only Wolgan Valley in Australia, where into this 40-key hotel in the middle of the Blue Mountains, we have been able to understand the market of rare locations, very, very unique, soft experiences, amazing services, " Zuber disclosed, when asked about the driving factor behind the brand extension strategy during an exclusive interview with Hotelier Middle East .
It has been suggested that the success of a brand extension will rely on a variety of factors.
Brand extension strategies are seen as beneficial because of marketing efficiencies such as reduced new-product introduction expenditure and increased possibility of success (Aaker 1990).
During the past decade, net new food and beverage introductions yielded an average 9% more in year-one sales versus brand extensions.
The move will accelerate Quindell's growth in brand extension services to brokers, it said.
Beyond being a crowd favorite, this brand extension generated huge awareness for the Nestl' Crunch brand.
Brand extension strategy is utilised when a firm employs an established brand name to introduce a new product in a different product category.
Cannibalization of the parent brand is one of the major risks involved in brand extension.
In these circumstances, a popular alternate approach is the brand extension strategy, which is the use of an existing brand name for launching a product in a new category (Aaker and Keller, 1990).