Equity: Brand Stretch
01 Jan 2009|Added Value
Now, we are no marketing purists. To quote a client, “There’s no harm knocking off a few gas stations when you are on your way to rob a bank”. But, when less than a third of all brand extensions launched actually make it to adulthood, you get a sense that guidelines for healthy stretch might be helpful.
Many of the infant mortalities occur because the new product simply doesn’t bring any material advantage. Others because the size of the opportunity does not merit the marketing support to make a good product cut through. And some, because the business expected the extension to rejuvenate an otherwise ailing core brand.
In our experience, the only good reason to extend a brand with a new product is if you believe it will help you to either access profitable new users, occasions or price points. And without significant cannibalisation of the core brand (some is usually inevitable). If it ticks one of these boxes, if the product has an advantage and if the business can afford to support it properly, then it should enhance the brand. Provided that the brand can enhance it.
Which may sound complex, but it’s actually quite simple. A good brand extension takes an established brand attribute into a new market space, where the attribute has currency, but is not yet available. The new offer is desirable and the core brand benefits from the association with the new space. Think iTunes, or virtually anything Apple has launched in the last 5 years.
All of which means that effective brand stretch requires a deep understanding of your own brand’s equity and a sharp sense of where its future profit opportunity could be. Couple that with the imagination of the inventor and the discipline of the brand strategist and you should be in safe hands. At least we would like to think so.prev next