Brand Extension Is Not Rubber Band!

about Brand extension Many people have done a lot of research. There are lots of contents about brand extension. In recent years, with the increasingly fierce competition, many enterprises have carried out brand extension in order to gain greater market share and increase profits. But many brands do not have gratifying sales volume or even go downhill when they extend their brand. Any brand connotation It is not endless. Brand extension is not an endless stretch of rubber band, nor is it a race on the field, the faster the better. Brand extension should also be moderate. Only with reasonable extension of quantity and speed can we ensure the safety of brand extension and ensure the healthy and sustainable development of enterprises. If the product of brand extension is too fast, consumers often doubt whether the enterprise has the ability to do so many products at once. A brand should try its best to cultivate its core products. If we can make a few limited products stronger and bigger, it will be better than dozens of products without influence.

Brand extension, the strategy of maximizing profit. In recent years, with the increasingly fierce competition, many enterprises have carried out brand extension in order to gain greater market share and increase profits. famous Marketing Expert Tan Xiaofang said the brand extension is understandable, but many Chinese companies do not have long-term plans, not only did not get the expected profits, but also greatly hurt the brand value. A double-edged sword of brand extension can speed up the development of enterprises if it is reasonable, otherwise it will be a stumbling block for the development of enterprises.

Brand extension (Brand Extensions) refers to the process of extending a famous brand or a successful brand with market influence to products that are not the same as the famous products or original products, so as to introduce new products with the existing successful brands. Brand extension is not simply borrowing the brand names that already exist on the surface, but the strategic use of the whole brand assets. Brand extension strategy can make new products successfully occupy the market with the help of the market reputation of successful brands while saving promotional expenses.

Brand extension is an important aspect of brand strategy. For a certain brand with customer loyalty, how can we keep the brand permanent and attractive to customers for a long time? The famous marketing expert, Mr. Tan Xiaofang, suggests that enterprises should constantly pursue the brand extension and accurately grasp and apply the brand extension strategy. Brand extension strategy is a strategy to apply existing brands to new products or modified products. In addition, brand extension strategy also includes product line extension (LineExtension), that is, the use of existing brand names to the same category of new products, new products, and new products, new flavors, new colors, new recipes and new packaging products.

When an enterprise's brand is successful in the market, the brand has market influence and will create super value profits for the enterprise. With the development of enterprises, when enterprises launch new products, it is natural to make use of the brand's market influence, and brand extension becomes a natural choice. This will not only save many new brands' fees and investments, but also extend the knowledge and evaluation of brands to the new products that the brand will cover by making use of the market influence of existing brands. In his practice, Mr. Tan Xiaofang summed up the three major aspects of brand extension. strategy -

First, in industry Upper extension

From the analysis of industrial correlation, it can go up, down or at the same time. This brand extension method provides a good way to extend the source of materials and products. The other is the parallel extension of the industry, which is generally suitable for products with the same (or similar) target market and sales channel, the same storage and transportation mode, and similar image characteristics. This is conducive to the marketing of new products, and on the other hand, is conducive to the consolidation of brand image. {page_break}

Two. product quality Grade extension

The following three extension methods are included: (1) extending upward, that is, adding high-grade production lines on the product line, so that goods can enter the high-end market. (2) extend downward, that is, adding lower grade products in the product line. Use the reputation of high-end brand products to attract customers with low purchasing power to buy low-grade and cheap products in this brand. If the original brand is a well-known brand name, this extension will easily damage the reputation of famous brand, and the risk is very great. (3) two-way extension, that is, when the enterprises originally positioned in the mid-range product market have mastered the market advantage, they decide to extend the product line up and down in two directions, on the one hand, increase the high-end products, on the other hand, increase the low-grade products and expand the market line-up.

Three. Other related extensions

Other related extensions, also known as diffusion methods. This is very meaningful for the famous brand that just grew up. It has four meanings: first, the single brand can spread to a variety of products to become a series of brands; two, the brand of one country can spread to the world and become an international brand; three, a brand proliferation will lead to another brand; four, the brand name product can be extended to the enterprise, so that the enterprise can become a famous brand enterprise.

Brand extension extends the new product or product portfolio from the surface. In fact, from the perspective of brand connotation, brand extension also includes the expansion of brand emotional appeal. If the new product does not contribute to the rich content of the brand emotional appeal, it will reduce or weaken the content of emotional appeal, and the brand extension will have a crisis. We should not only see the brand's market influence on the promotion of new product listing, but analyze whether the market and social orientation of the product will help stabilize the brand market and social status, and whether the two are compatible. For example, the 39 group carried out brand extension, and extended the 999 stomach to the beer industry. "999 ice beer, enjoying the four seasons together," always gives consumers a sense of discomfort, and thus produces the mentality of exclusion. For example, washing powder, extending to pure water, makes consumers feel the smell of washing powder when they drink their water. Such examples are numerous.

We know that brand image is the foundation of brand extension, but in the vertical extension of brand, if the high-end market is extended to the low-end market, it will greatly affect the high-end image of the brand, and will lose the high-end market. For example, park has extended to the low end market. In 1982, when the new general manager of peck company took office, instead of focusing on improving the style and quality of Parker's pen, he turned to low price product development and contended for low-end pen market. Finally, the low-grade pen has no market, and the high-end pen market has been largely occupied by other brands, and it has almost lost its high-end brand image. Tan Xiaofang said that the core value of the same brand is the most important factor in the brand extension. Many cases of success and failure of brand extension can be found from the following rules. Let's look at the following cases -- {page_break}

1. 3M brand

There are more than 67000 kinds of products under 3M company, the most common is the notepad on our desk. Although the products of 3M look very jumbled, this does not affect the brand image of 3M, because the core value of 3M brand is "innovation" running through all products. 3M develops more than 200 new products every year. Almost every two to one day, a new product comes out. When consumers see any 3M product, they will immediately associate "this is a new product of 3M".

Two. Porsche case

Porsche (Porsche) is a top sports car brand in Germany and enjoys a world-wide reputation. In the minds of consumers, Porsche represents the 6 cylinder and engine rear 911 series sports car. This clear positioning has made Porsche popular among consumers. In 2000, GM gained 853 dollars from every car sold, while Porsche could earn 7350 dollars. However, in order to further expand the market share, Porsche also carried out the brand extension. In 1970s and 80s, Porsche tried to enter the car market, and jointly launched the 914 engine and the engine front 924 with Volkswagen and Audi motor. The two models were not accepted by consumers and aborted. In 1978, Porsche launched the 928 models of engine front-end and V-8 power, and finally launched tears. In fact, the 911 series sports car behind the Porsche engine has been deeply rooted in the hearts of the people. For Porsche enthusiasts, other types of cars are not real Porsche.

Three, Haier refrigerator

When Haier extends from refrigerators to air conditioners and washing machines, these appliances are highly correlated, so they succeed. But then they extend to the mobile phone field. The product span is too large, the correlation is weak, and Motorola and NOKIA are strong in the mobile phone market, so losing is inevitable. Haier has entered the pharmaceutical industry, the "national liquor" Moutai extends to beer, wine, Wahaha extends the Guandi liquor, children's clothing, the traditional household electrical appliance enterprise AUX group enters the automobile industry, 39 stomach Tai extends 39 beer, all because the extension before and after the product relevance is weak and has ended in defeat. Such brand extension not only does not rely on the influence of the original brand, but also dilutes the value of the original brand.

Four, Wahaha brand

In 1995, Wahaha brand extended the introduction of purified water into the adult beverage market. Wahaha was originally a children's fun and cute children's brand, while Wahaha Purified water showed its youthful and fashionable adult brand image. The Wahaha brand's "face changing" action made it face great challenges. However, Wahaha Purified water has been very successful. In 1997, the sales volume of Wahaha pure water exceeded 500 million yuan. The reason why Wahaha pure water is successful is that the Chinese market is far from mature. Before Wahaha and barest, China's pure water market has never had a national leading brand, which will bring great opportunities for brand extension. Similarly, the United States entered the market of gas cookers, lampblack exhauster and water heaters, and achieved success in the absence of advertising investment. The main reason is that there is no real strong brand in the market of gas appliances and cookers.