What is a brand extension? Five examples of how to use it
As consumers, we are exposed to and utilize brand extensions each and without even knowing it. It doesn't matter if we're sipping an exclusive Pepsi brand while watching TV, browsing the frozen aisle of the store, or online shopping to purchase a new moisturizer, it is likely that the item falls in with a parent brand and extends the original offerings of the company.
What is the reason companies use extension of their brand names? If you thought it was because of money it's true! While some companies thrive off having a product that they can master, the real reason businesses have brand extensions is that they can be extremely profitable - if it's successful.
What is a branding extension?
Let's set the meaning of "brand extension" clear first. It sounds like an elaborate corporate marketing phrase however, in actuality, it's pretty straightforward.
An expansion of a brand occurs when a reputable firm or business begins selling a new product or a product in a new category using the name of its brand.
The distinction between line extension and brand extension
Instead of getting into the nitty-gritty of every way you can create an extension to your brand products (there are many) The two main ones that everyone in the business should be acquainted of are brand extensions and an extension of a line. Although they're both types of product extensions however, they have a few key differences.
A brand line extension is the time when a brand launches an item that has a twist. Have you had you heard of Coke Zero Sugar or Diet Coke with Lime? It's exactly the same thing with a brand new name and it's got appealing flavors that will draw the loyal customers of Coca-Cola to sample the product. Generally, line extensions are more secure since they're part of the same product line. In some cases, a line extension may also be called vertical extensions because they could also be applied to products which have tiered alternatives. Televisions are an excellent instance of this because it is possible to purchase the same television in different sizes or even with additional features in a nutshell it is possible to select cheaper options or an upgraded version of the same product.
On the flip side, the brand extension can be an entirely different product that is part of a new product line such as, Dyson Supersonic(tm) hair dryer. Dyson is a great example. Once only known for its vacuum vacuums, the business utilized its technological know-how to expand its products to the cosmetics industry through the release of an ingenious hair dryer and different hair styling tools. The result was massively. For some segments of the market, the public is more aware of Dyson's hair dryer than its most recent vacuum cleaner. It's also referred to as a horizontal brand extension which is where the parent company develops a completely new product underneath it.
Experiments with real-world brand extensions
We mentioned before that extension of brands are commonplace nowadays. We've probably tossed around a few examples already and here's five more real-life brand extensions to reference to help you think about your own ideas:
- Topo Chico Hard Seltzers
Topo Chico is a well-renowned mineral water maker from Mexico and now is part of Coca-Cola. The bottle is well-known flavor, logo, and taste. The latest extension of the brand is Topo Chico Hard Seltzer - sparkling sparkling drink that is spiked. It entered a brand new category of products by offering alcohol-based drinks and has had a huge success thanks to its reputed authority within the drink industry. It paid off - its new product was the third fastest hard seltzer brand selling nationwide this year.
- Apple Watches
Apple We all have heard of that brand and probably use or have used some of its products previously. Because the company was founded as a computer company as well, the Apple Watch product is a perfect example of brand extension. The Apple Watch can be seen as an upgrade of iPhone - while at first, it's success was slow however, after a meticulous marketing campaign and an emphasis on health and fitness, Apple consumers jumped at the chance to purchase the brand new device. Plus it is the case that it is a brand new product. Apple Watch has a brand line extension itself because Apple constantly releases new versions featuring different price levels.
- Fenty Skin by Rihanna
After Fenty Beauty generated $550 million in revenue in the first year, it became one of the most successful known brands that were fronted by celebrities. With the established reputation and strong following that is Fenty Beauty, Fenty Skin was created. Rihanna has launched her skincare line strategically; Fenty Skin is marketed as gender-neutral and inclusive skincare - unlike other skincare companies. This is an excellent example of a brand extension which has brought a wider public to join a larger brand.
- Amazon and Whole Foods
When Amazon bought Whole Foods, everyone did take a second look. However, this unorthodox combination resulted in a revolution in the way that consumers shop for and purchase grocery items. It is a unique instance of brand extension due to the fact that when Amazon purchased Whole Foods, the grocery chain kept its own branding. With the help of Amazon's loyalty program to get discounts on grocery items, the delivery service successfully extended its name into a completely new segment.
- Star Wars Franchise
The entertainment industry is famous for brand extensions! Sequels, spin-offs and adaptations to TV are just a few methods that companies in the entertainment industry make brand extensions. Star Wars is a great model with multiple television shows, franchises and video games, as well as merchandise, and books. There's there is even a themed park at Disneyland. The Star Wars franchise has generated a loyal customer base and Disney has recognized this and not only cultivated new audiences around it but profited well from the various extensions to its products.
How to develop an extension of your brand name for an online-based entrepreneur
It's not difficult to imagine brand extensions in relation to physical items, for online entrepreneurs, the possibilities of extending your brand are endless.
Craig Beck is the perfect illustration of an internet-savvy businessman who has utilized his brand to create several extension of his brand. Using , Craig has launched a variety of digital products - not only does he have an extremely well-known and popular sobriety coaching services, but he's also broadened his business to encompass personal coaching as well as investing coaching! Craig has managed to extend his coaching brand into different categories which has allowed him to grow his audience as well as his revenue.
Making a brand extension an online business owner should be done with three essential components:
- The research aspect: We cannot stress enough research! And we specifically mean audience research. The research of your most loyal customers is crucial for brand extension. Without your loyal followers' support, you can most likely find that your product will flop. Send a survey out in your area, organize an online group of focus groups, or hold a town-hall Instagram live to gather the opinions of your followers.
- Make your HTML0 extension with the brand's parent company in mind:When creating the extension of your branding, you must make sure you don't dissociate the product from the parent brand. It doesn't matter if you'd like to utilize the same brand name, logo, theme, or line, you'll need your brand extension to be recognizable.
- The beta test The beta tests that are frequent in digital goods and software. The beta test happens when you make your version or upgrade to a select number of people first to see their reactions as well as work out any issues, and more. This is a fantastic way to test the waters and receive feedback before you waste time and money on creating a expansion of your brand that may be unsuccessful.
One of the best things about trying out a brand extension with digital items is that you won't need to pay for it - you could offer your program or site membership for free without having the expense of manufacturing a physical product. It's the win-win.
A word of caution regarding extension of brands
Let's be honest - extension of brands can be disastrous if done poorly. Remember the IHOb/IHOP debacle of 2018? IHOP increased its branding by introducing new burgers as well as, in a publicity stunt, changing its image to IHOb. While it garnered attention, many thought it was more like an April Fools Joke instead of a brand extension. Following the scathing comments of competitors and fans about the company on social media, there was no official success of the upgraded and new products (burgers) and the whole thing resulted in embarrassment for restaurant chain.
What lessons can we take from these mistakes? Do your research and use your customers as the primary resource for new ideas and digital product launches. Be careful of venturing into an area where you have less authority - it could cost you.
Growing your brand and your product
If you're an online entrepreneur trying to grow your business correctly doing the proper analysis and scrutinizing will help you to create branding extensions that increase your current audience and bring new customers into your circle.