Brand extension

The brand extension strategy consists in using brand equity in new markets. Consumers are more likely to accept and value the brand extension if:

  • It is consistent with the core values of the brand (Bic pens, razors and lighters are consistent with the Bic core values: good value for money, simple and functional products).
  • The core values of the brand are legitimate and justified among the new product category (Vittel and Evian succeeded in cosmetics, not really because these companies are cosmetics specialists, but because for many years they have been advertising purity, well-being and beauty).
  • It is considered as relevant to the competing offer (Nestlé Nesquik wanted to extend its brand to the refrigerator by introducing fresh pudding. Except for the packaging color the product was exactly the same one the competitor Danette offered . Hardly anyone accepted the new product; therefore Nesquik dessert quickly disappeared from the shelves. In contrast, Caterpillar, the American tractors and bulldozers specialist have become today a reference in fashion thanks to its range of products that meet the different brand codes of toughness, reliability and progress).