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 ?
However, the unknown aspect is that if far brand extensions are favored only by interdependent consumers (Ahluwalia, 2008), how can those cross-category extensions succeed in market segments that consist of consumers ranked high on independent self-construal?
This empirical study intends to provide knowledge concerning consumer acceptance of fashion apparel extensions, which may facilitate functional mass-market brands to identify the direction for cross-category brand extensions and to compete for a share of consumer identity.
Margins in the used-vehicle business have been temporarily pressured from AutoNation's "One Price" strategy rollout, and the company has incurred elevated selling, general and administrative (SG&A) costs as it implements its brand extension strategy.
In a similar study in Taiwan it was found that using professional baseball teams as brand extensions could have an impact on the parent brand's image (Walsh, Chien, & Ross, 2012).
Brand extensions are very popular in branding strategy.
They include three musicians: Beyonce (#17, with fashion and fragrance), Shakira (#58, fragrance), and Lady Gaga (#67, fragrance and Barney's tie-in); two talk-show hosts: Oprah (#14, chai tea with Starbucks) and Ellen DeGeneres (#46, pet products); one actress: Sofia Vergara (Kmart tiein); three fashion designers: Diane Von Furstenberg (#68), Miuccia Prada (#75), and Tory Burch (#79), all tied to brand extensions of one kind or another; and one model: Giselle Bundchen (#89, with apparel, footwear, and cosmetics).
Generally, two main advantages of brand extensions could be underlined: the ability to facilitate new-product acceptance; and provide positive feedback to the parent brand and company (1).
There were brand introductions, brand extensions and brand reinventions from many well-known players in the industry.
Brand extensions help in increasing recognition and enhancing acceptance of the product.
During the past decade, net new food and beverage introductions yielded an average 9% more in year-one sales versus brand extensions. In 2012, the difference is +32%, with net new brands commanding $54.3 million dollars across the multi-outlet geography versus $41.0 for new brand extensions.
IRI notes that, for the most part, the bulk of the new products were brand extensions, with 82% of the new food and beverage items launched last year adding to an established line and 91% of the nonfood products debuting being brand extensions.