“It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.” – Charles Darwin
When it comes to the competitive marketplace, Darwin’s quote is as relevant today, or maybe even more so, than it was back in 1809.
In today’s dynamic environment, companies are looking to evolve to meet changing needs, meaning that brand extension is often times a key to success. Moving into a new space needs to be approached with confidence, knowledge and a well-designed strategy. A brand extension can fail if the brand’s philosophy is not well understood in the market and the strategy for expansion is not implemented correctly.
In today’s dynamic environment, companies are looking to evolve to meet changing needs, meaning that brand extension is often times a key to success.”
One of the most well-known and successful brand extensions was by Apple. The company extended its brand from making personal computers (Mac), into personal audio (iPod) and then again into the realm of smart phones (iPhone). Needless to say, this proved to be a wise move, as more than 60% of the company’s sales today come from the iPhone.
As a starting point, there are two key questions about a brand extension that need to be addressed:
Declining sales, low brand awareness, changes in the market, or increasing competition can trigger the need for a change. In Apple’s case it was to take advantage of an evolving competitive landscape and changing marketplace. Their technology presented an opportunity to grow the brand further
Increasing brand awareness, acquiring new customers, or expanding use with current customers can be the goals of a brand. The example of Apple is a clear case of driving expansion and capitalizing on loyalty. Once these questions are answered, the real work begins. With so many options currently available to an increasingly savvy consumer base, you’ll need to take a careful, stepwise approach to prepare for making the move into new areas for your brand.
A brand extension can fail if the brand’s philosophy is not well understood in the market and the strategy for expansion is not implemented correctly.”
These steps include:
1. Taking a careful look at the marketplace to identify where those opportunities lie for your brand and deciding whether those opportunities line up with the vision and outcomes you laid out when answering those key questions posed earlier.
2. Creating, evaluating, and prioritizing a robust set of ideas that match up with these opportunity areas and will dictate the direction of your brand extension plan.
3. Understanding whether your top ideas will be accepted from consumers in the context of how they see your brand, or whether they require a different brand framework altogether.
4. Optimizing your top ideas within the context of the marketplace you intend to enter and gauging feasibility before fully committing to the launch of your extension.
Brand extensions are meant to be positive ventures, where time spent on the front-end planning, researching your intended market, and testing your strategy, can be the difference between pulling it off or falling short trying.
Learn more about our brand extension research.