The Right Brand Extension Strategy for Improved Company Performance

INTRODUCTION When a company innovates and develops a new product, it is necessary to develop a strategy for effectively selling the product. In addition, companies need to create characteristics unique to their products so that customers are interested in their products. These unique features are called brands. Many companies are beginning to introduce new products to consumers using parent brands rather than developing new brands for new products.

Brand expansion is the strategy that most companies use to minimize the risks associated with the introduction of new brands and maximize the benefits from new brands. However, in some cases brand expansion failed because brand equity of parent brand was weaker than success of brand expansion. If the equity of the parent brand is strong, expansion of the brand may succeed. Both functional and nonfunctional attributes of the brand impair fairness of the integrated oriented brand and may ultimately be diluted. Such expansion failures can cause negative connections between customers and parent brands, and even brand families. These failures can also induce, ambiguous and even find the original identity and meaning of the brand

Brand expansion is a strategy that most companies use to exploit existing brand names for other products (Serrao & Botelho, 2008). The kingfisher packaged drinking water is an example of brand expansion. The impact of brand expansion on the brand image of original products is being discussed in the above-mentioned paper. Brand image is a series of perceptions that potential consumers maintain product characteristics. This concept is stronger and the brand image becomes stronger. Expansion of the brand now influences the brand image of the initial product. If the expanded brand does not meet expectations, or if there is a possibility to strengthen it, there is a possibility of continuous dilution. When prohibiting advertisements, agency ads can become the only medium to create more product information, so you can enhance your brand image.