Introducing and Naming New Products & Brand Extensions-8

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Introducing & Naming New Products & Brand Extensions

Presented By: SUHAS NOEL

Leverage the Brand:Firms are seeking to build power or mega brands that establish a broad market footprint, appealing to multiple customer segments with multiple products all underneath the brand umbrella.

Ansoffs Growth Share Matrix:Current Products New Products

Current Markets

Market penetration strategy

Product development strategy Diversification strategy

New Markets

Market development strategy

Brand Extensions: When a firm uses an established brand name to introduce a new product Brand extension classification Line extension Using a sub-brand to target a new market segment within the same product category Category extension Using the parent brand in a different product category

General Strategies for Establishing a Category Taubers FranchiseExtension: Introduce the same product in a different form.

Example: Ocean Spray Cranberry Juice Cocktail and Jell-O Pudding Pops Introduce products that contain the brands distinctive taste, ingredient, or component. Example: Philadelphia cream cheese salad dressing and Haagen-Dazs Cream Liqueur Introduce products relevant to the customer franchise of the brand. Example: Gerber insurance and Visa Traveler's Checks

Introduce products that reflect the brands distinctive benefit, attribute, or feature. Example: Lysols deodorizing household cleaning Products and Ivorys mild cleaning products Introduce products that capitalize on the distinctive image or prestige of the brand. Example: Calvin Klein clothes and accessories and Porsche sunglasses

Advantages of Extensions: Facilitate new product acceptance1.

2. 3. 4. 5. 6. 7. 8.

Improve brand image Reduce risk perceived by customers Increase the probability of gaining distribution & trial Increase efficiency of promotional expenditures Reduce costs of introductory and follow-up marketing programs Avoid cost of developing a new brand Allow for packaging and labeling efficiencies Permit consumer variety seeking

Advantages of Extensions (Cont.) Provide feedback benefits to parent brand 1. Clarify brand meaning 2. Enhance the parent brand image 3. Bring new customers into brand franchise and increase market coverage 4. Revitalize the brand 5. Permit subsequent extensions

Disadvantages of Extensions:1. 2. 3. 4. 5. Can confuse or frustrate consumers Can encounter retailer resistance Can fail and hurt parent brand image Can succeed but cannibalize sales of parent brand Can succeed but diminish identification with any one category 6. Can succeed but hurt the image of the parent brand 7. Can dilute brand meaning 8. Can cause the company to forgo the chance to develop a new brand

Understanding How Customers Evaluate Brand Extensions: Managerial

assumptions :-

1. Consumers have some awareness of and positive associations about the brand in memory 2. At least some of these positive associations are evoked by the brand extension 3. Negative associations are not transferred from the parent brand 4. Negative associations are not created by the brand extension

Successful Extensions: Must create points-of-parity and points-of-difference in

extension category Must recognize competitive reactions

Must enhance points-of-parity and points-of-difference of parent brand Must maximize the advantages and minimize the disadvantages of brand extensions

Successful Category Extensions:1) Ivory shampoo and conditioner 2) Vaseline Intensive Care skin lotion 3) Visa travelers checks 4) Sunkist orange soda 5) Colgate toothbrushes 6) Mars ice cream bars 7) Arm & Hammer toothpaste 8) Dove shampoo and conditioner 9) Hershey chocolate milk 10) Porsche coffee makers 11) Fendi watches 12) Jeep strollers

Unsuccessful Category Extensions:1) Campbells tomato sauce 2) LifeSavers chewing gum 3) Cracker Jack cereal 4) Bic perfumes 5) Ben-Gay aspirin 6) Kleenex diapers 7) Levis Tailored Classics suits 8) Nautilus athletic shoes 9) Dominos fruit-flavored bubble gum 10) Smuckers ketchup 11) Cadbury soap 12) Ben-Gay aspirin

Brand Extensions Example 1:Levis Jean SegmentsBrand Levi Strauss Signature Levi Strauss Signature Authentics Levis Redtab Levis Silvertab Levis Red Levis Vintage Price Range $19 - $23 $24 - $25 $25 - $50 $25 - $58 $49 - $68 $80 - $325

Example 2Brand DefinitionsMoisturizer Lotion Medicinal Vaseline Intensive Care Purity Body care Pump bottle Baby care Fragrance

Related CategoriesSoap, Face cream, Skin cream Sunburn, Aftershave, Baby Antiseptic, First-aid cream, Hemorrhoid cream Cotton, Gauze, Sterile pads Emery boards, Muscle toner, Cotton swabs Liquid hair net, Mustard, Glass cleaner Diapers, Powder, Oil Perfume, Room deodorizer, Deodorant

Design Marketing Programs to Launch Extension:They are:1. Choosing Brand Elementsa) b)

Logo Trademark

2.

Designing Optimal Marketing Programa) b) c)

Building Brand equity Consumer perceptions of value must guide pricing decisions Firm must integrate marketing communications by mixing and matching communication options

3.

Leveraging Secondary Brand Associationsa)

Additional fortification like linking to other entities