Brand Extensions: What Works and What Doesnt

BRAND EXTENSIONS: WHAT WORKS AND WHAT DOESNT

Qaiser Janjua
1
Assistant Proessor
Air !ni"ersit# Is$a%a&a'
Ke# (or's: Brands, Brand Extensions, Marketing, Brand Dilution
1
Qaiser Janjua is Assistant Professor of Marketing at Air ni!ersit", #sla$a%ad, Pakistan&
'el& ()*+,1+)*-*,,. + *--
E+$ail: /aiser&janjua0$ail&au&edu&1k
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Brand Extensions: What Works and What Doesnt
A&stra)t:
'his resear2h 1a1er su$$ari3es the i$1ortan2e of ke" as1e2ts affe2ting 2onsu$er e!aluations of
%rand extension %" s"nthesi3ing 1re!ious resear2h in this field& 4iterature re!ie5 highlights four
$ain areas of i$1ortan2e in2luding the nature of the %rand extensions, extensions effe2t on
1arent %rand, ante2edents of 2onsu$ers e!aluations of the extension, and the 5a" the %rand
extension should %e 2on!e"ed& 'hese findings are then a11lied to the extensions of the %rand
6ater1illar and its h"1otheti2al extension of 5ork jeans as a dissi$ilar extension& 'heoreti2al
i$1li2ations eli2it re$arka%le re!elations and strategi2 i$1li2ations for %rand $anagers for
su22essful %rand extension in si$ilar and dissi$ilar 2ategories&
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Brand Extensions: What Works and What Doesnt
TAB*E O+ ,ONTENTS
1- INTROD!,TION .
/- *ITERAT!RE RE0IEW .
*&1 B7A8D E9'E8:#;8 6<A7A6'E7#:'#6:&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&=
*&* PA7E8' B7A8D 6<A7A6'E7#:'#6: A8D D#4'#;8&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&=
*&= 6;8:ME7 6<A7A6'E7#:'#6:&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&=
*&> B7A8D E9'E8:#;8 6;MM8#6A'#;8&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&=
.- BRAND EXTENSION APP*I,ATION .
=&1 6A'E7P#44A7 A8D #': B7A8D E9'E8:#;8:&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&&=
=&1&1 6ater1illar 6onsu$er Extensions and Pro1osed Work Jeans Brand =
,ON,*!SION .
+!T!RE RESEAR,H .
RE+EREN,ES .
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Brand Extensions: What Works and What Doesnt
1. INTRODUCTION
Brand extension has %een a 1o1ular strateg" for entering into ne5 seg$ents %" extending %rands
into si$ilar or ne5 1rodu2t 2ategories through le!eraging existing %rand 1er2e1tions and i$age&
#n other 5ords, it is a $arketing endea!or that links and transfers existing 1ositi!e 2onsu$er
1er2e1tions of a 1arent %rand 5ith the ne5 1rodu2t there%" 2a1itali3ing on existing e$otional
relationshi1 and heritage of the 1arent %rand& 'here are se!eral $anagerial 1ers1e2ti!es %ehind
%rand extensions ho5e!er, the %asi2 idea is to 2a1itali3e on the existing 1ositi!e %rand
asso2iations 5hi2h signif" 2onsu$er trust and 2o$$it$ent %" introdu2ing ne5 %rands in si$ilar
or dissi$ilar 2ategories in order to a2hie!e di!ersifi2ation and $ost i$1ortantl" generate ne5
sour2es of re!enue and in2rease $arket share& Extending a %rand leads to e2ono$ies of s2ale,
redu2ed $arketing 2osts, lesser ti$e for $arket ada1ta%ilit" as 2o$1ared to introdu2ing a ne5
%rand& Brand extensions are also a 1rofita%le strateg" for fran2hise de!elo1$ent and li2ensing&
?or de2ades, fir$s ha!e %een e$1lo"ing %rand extensions and the trend is on the rise& Aaker
@1))AB found that fro$ 1).. to 1)C>, a11roxi$atel" 1., ne5 %rands 5ere laun2hed in the
nited :tates ea2h "ear and out of 5hi2h >AD 5ere %rand extensions& :i$ilarl", Mur1h" @1)).B
in his stud" found that ),D of the 1-,AAA ne5 %rands introdu2ed in the : e!er" "ear 5ere
%rand extensions& Aaker @1))AB re!ealed that : 2o$1anies s1ent around :E ,A Million 1er
"ear for laun2hing ne5 %rand extensions& 8e!ertheless, the h"1e in %rand extension has led $an"
%rand extensions to fa2e a disastrous failure 5here not onl" the %rand extension entailed a
negati!e 1er2e1tion and 2aused signifi2ant $onetar" losses %ut also diluted the o!erall %rand
e/uit" of the 1arent %rand& Ernst, Foung and 8ielsen @1)))B in their stud" 2o!ering se!eral
2ountries sho5ed that %rand extensions in ?M6G 2ategories had a failure rate of a%out CAD&
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Brand Extensions: What Works and What Doesnt
'his sho5s that %rand extension is a dou%le+edged s5ord and so$e industr" anal"sts 2all
extension as a lo5+risk %randing strateg" %ut also ter$ it as a ga$%le&
:in2e %rand is an e$otional affiliation %et5een the 2o$1an" and its 2usto$ers, as a result the
su22ess of extension is de1endent on ho5 2onsu$ers e!aluate it& 'herefore, it is essential to
understand the fa2tors affe2ting 2onsu$er e!aluations of %rand extension& During the 1ast three
de2ades, 2onsidera%le resear2h has %een 2ondu2ted in ex1loring and understanding fa2tors
influen2ing %rand extensions 5hi2h 1ro!ide ke" insights in generali3ing su22ess strategies for
%rand extension&
6onse/uentl", the 1ur1ose of this arti2le is to su$$ari3e and s"nthesis ke" findings of 1rior
resear2h in the area of %rand extension %" re!ie5ing i$1ortant arti2les and a11l"ing rele!ant
insights to a dissi$ilar %rand extension in a h"1otheti2al s2enario& 'he 2hosen %rand is an
industrial giant i&e&, 6ater1illar and the a11li2ation re!ol!es around its existing 2onsu$er
extensions as 5ell as the 1ro1osed extension of 5ork jeans&
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Brand Extensions: What Works and What Doesnt
2. LITERATURE REVIEW
2.1 Brand Extension Characteristics
Aaker and Heller @1))AB 1resented so$e of the $ost useful 2on2e1ts in the %rand extension
literature& 'heir stud" 5hi2h in!ol!ed h"1otheti2al %rands re!ealed a nu$%er of useful 2on2e1ts
in2luding a 2on2e1t of Ifit& 'he" found that the %rand extension 5ill 2arr" the 1arent %rand
1ositi!e asso2iations onl" if there 5as a Ifit %et5een the t5o 1rodu2t 2lasses& 'he" ela%orated
different di$ensions of fit in2luding the 2on2e1t of 'ransfer, 6o$1le$ent and :u%stitute& 'he
also found that 5hen 2onsu$ers 1er2ei!ed that the 1arent 2o$1an" had ne2essar" 2a1a%ilit" in
the first 1rodu2t 2lass to laun2h a %rand extension in a ne5 1rodu2t 2lass then 2onsu$ers
e!aluated that extension 1ositi!el" regardless of the /ualit" of the 1arent %rand& ?or instan2e,
<onda generators gained 1o1ularit" %e2ause 2onsu$ers %elie!ed that the 2o$1an" had ne2essar"
engineering 2a1a%ilit" to laun2h a /ualit" 1rodu2t in a ne5 seg$ent& <o5e!er, if <onda had
introdu2ed sneakers then it 5ould ha!e resulted in a failure& #n other 5ords, 1arent %rand 1ositi!e
asso2iations are su22essfull" I'ransferred 5hene!er there is a 1er2ei!ed a%ilit" of the fir$ to
enter the ne5 2ategor"& :i$ilarl", 6o$1li$ent is %asi2all" ho5 the 1arent %rand and the %rand
extension 2o$1li$ent ea2h other su2h as addidas sneakers and addidas tights 1ro!ide 2o$$on
a11li2ation and there is a Ifit %et5een the t5o %rands& #t $eans that greater the ele$ent of
I6o$1le$ent exists %et5een the 1arent %rand and the %rand extension, %etter is the extension
e!aluated& Moreo!er, it 5as found that 1resen2e of either the ele$ent of I6o$1li$ent or
I'ransfer 5as ade/uate for a su22essful extension& 'he effe2t of the ele$ent of I:u%stitute 5as
not found to %e of signifi2an2e& Another di$ension of fit 5as the 1er2ei!ed diffi2ult" of $aking
an extension& 6onsu$er negati!el" e!aluated the %rand extension 5hen a /ualit" %rand na$e
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Brand Extensions: What Works and What Doesnt
5as extended into a tri!ial and eas"+to+$ake 1rodu2t 2ategor"& Botto$le" and <olden @*AA1B
se2ondar" resear2h of se!eral re1li2ation studies strongl" su11orts the findings of Aaker and
Hellers @1))AB $odel 5hi2h 2on2ludes that the fit %et5een the 1arent %rand and the extension is
reliant on di$ensions of fit @2o$1le$entaril" and transfera%ilit" of assets and skillsB and the
diffi2ult" of $aking an extension& Broniar2"3k and Al%a @1))>B further ela%orated the 2on2e1t of
fit& 'he" ex1lain that Ifit is de1endent on a !ariet" of %rand s1e2ifi2 related asso2iations that are
1resent in the $inds of the 2onsu$ers and 5hen these asso2iations are 1re!alent in the extension
1rodu2t 2ategor" than a %rand is 1er2ei!ed 1ositi!el"& 'herefore, %rand 2an %e extended to %oth
si$ilar as 5ell as to a dissi$ilar 2ategor" 5here the salient %rand asso2iations are $ost rele!ant&
'he" found that 8ike Wingti1s 5ere 1er2ei!ed negati!el" %e2ause irrele!an2" of 8ikes
Iathleti2 i$age in a $ore Ifor$al 2ategor" ho5e!er ?root 4oo1s 2ereal 5hi2h de1i2t i$age of
Is5eet, fla!or and kids 5as e!aluated 1ositi!el" %" 2onsu$ers 5hen it 5as extended to lolli1o1s
and 1o1si2les, a dissi$ilar 2ategor"& #n other 5ords, %rand+s1e2ifi2 asso2iations 5ere found to %e
ke" ele$ents, 5hi2h do$inated %rand effe2t and 1rodu2t 2ategor" si$ilarit"& A22ording to the
authors, %rand 2on2e1ts are the %rands distin2ti!e asso2iations that are an a$alga$ation of
1arti2ular 1rodu2t attri%utes, 2onsu$er %enefits and $arketing 2o$$uni2ation that highlight
these asso2iations into 2on2rete or a%stra2t fashion& 'he" found that %rands 5hi2h 5ere regarded
5ith res1e2t to their 1rodu2t 2lass 2ategor" @fun2tional as1e2tsB 5ere diffi2ult to extend to
dissi$ilar 2ategories 5here as 1restige %rand na$es 5hi2h 5ere asso2iated 5ith luxur" and
status @e&g&, 7olexB 5ere eas" to extend to si$ilar or dissi$ilar 2ategories @e&g&, %ra2eletsB
%e2ause the" not onl" hold the fun2tional as1e2ts %ut also de1i2t 1restige 5hi2h reside on a $ore
e$otional and su1erior le!el and 5ere do$inant than fun2tional asso2iations& Brodie J Gl"nn
@1))CB re1li2ated Broniar2"3k and Al%a @1))>B stud" and found si$ilar results that rele!ant
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Brand Extensions: What Works and What Doesnt
%rand+s1e2ifi2 asso2iation hel1 in2rease fit and the %rand 2ould %e extended to far off 2ategories&
An exa$1le in this regards is the Jif %athroo$ 2leaner for 5hi2h the ad sa"s I2leans and shines
5ithout harsh s2rat2hing into glass 2leaners and 2leaning 2loths sin2e the %rand s1e2ifi2
asso2iations %et5een the t5o 2ategories %e2o$e rele!ant& ?ar/uhar J <err @1))*B 1ro!ide
further ela%oration of this 2on2e1t that %rands 5hi2h are kno5n for their tangi%le 1rodu2t
asso2iations are diffi2ult to extend on an a%stra2t %asis %ut 2an %e extended if their tangi%le
attri%utes are highl" desira%le in the 1rodu2t 2ategor" and !i2e !ersa& Exa$1les of su2h
extension in2ludes 'o"ota introdu2ing ?ork lifters there%" extending salient %rand asso2iations
su2h as su1erior 5eight lifting 2a1a2it", 1o5erful engine and other 2on2rete features 5hi2h are
highl" desira%le in the fork lifter 2ategor"& 'his leads to the fa2t that a fit %et5een the 1arent
%rand and the extension is also de1endent on the t"1e of i$1ortant attri%ute@sB, tangi%le or
a%stra2t, do$inating the 1rodu2t 2ategor"& Bridges et& al @*AAAB further 2larified the 2on2e1t of fit
%" introdu2ing a 2on2e1t of I6oherent 6ategories 5here 2onsu$er 1arti2ular needs %ring
together different 1rodu2t 2ategories& ?or instan2e, Bo$%ardier aeros1a2e 1rodu2ts su2h as s$all
2o$$er2ial 1lanes and Bo$%ardier 2hrono$eter are 2oherent in a 5a" that the" fulfill the needs
of 1ilots& Martin et al& @*AA,B re2entl" introdu2ed a goal+deri!ed 2ategori3ation fra$e5ork
a22ording to 5hi2h 2onsu$ers arrange %rand infor$ation and for$ attitudes in the $e$or"
related to goals and as long as 1rodu2ts ha!ing si$ilar na$e ha!e 2o$$on goals, 1ositi!e
1er2e1tions of fit are generated& #n their stud", 1arti2i1ants 5ere 2onfused to kno5 that 7ee%ok
5ould laun2h leather shoes and Benetton 5ould introdu2e athleti2 5ear& As an exa$1le, M26ain
Pi33as, M26ain ?ren2h ?ries and M26ain #2ed share 2o$$on link of an IA$eri2an ?ood that
1ro!ide its 2usto$ers a $ore a%stra2t and e$otional goal of shared !alues i&e& IA$eri2an
4ifest"le andKor IPatriotis$& <o5e!er, this goal deri!ed theor" 2an %e ter$ed as the %roadest
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Brand Extensions: What Works and What Doesnt
stage of %rand extension as a22ording to Ha1ferer @1)).B Lthe last and %roadest stage of %rand
extension is 5hen the %rand signifies a 2o$$on s1irit, an a$%ition and an allegian2e to shared
!aluesM& #n other 5ords, its a su%2ulture of 2onsu$1tion that %inds 2ategories and 2onsu$ers
together& A1art fro$ 1rodu2t and %rand issues, 'a"lor and Bearden @*AA*B found that the 1ri2e of
%rand extension had $ore 1ositi!e effe2t on the /ualit" of dissi$ilar extensions in 2ontrast to
si$ilar extensions& #n addition, the" found that a higher initial 1ri2e for a %rand extension
had a 1ositi!e i$1a2t on 1er2ei!ed /ualit" e!aluations for dissi$ilar extensions %ut not si$ilar
extensions& Although the stud" did not 2onsider 2ertain fa2tors su2h as the $arketing
2o$$uni2ation s"ste$ for that 1arti2ular %rand ho5e!er, the results i$1l" that if $anage$ent is
looking for le!eraging its %rand e/uit" in a $ore effe2ti!e 5a" then it should 2onsider dissi$ilar
1rodu2t 2ategories and 1osition the ne5 extension as relati!el" high+1ri2ed&

2.2 Parent Brand Characteristics and Di!tion
'he su1re$a2" of 1arent %rand is extre$el" i$1ortant in %rand extensions& Heller and Aaker
@1))*B found that high /ualit" %rands su2h as 4e!er Brothers 5ere 1er2ei!ed as trust5orth",
ex1ert and $ore relia%le& 7east @*AA,B in a H stud" found that %rands 5ith higher trust tended
to sho5 fa!ora%le 2onsu$er e!aluations for line, si$ilar and dissi$ilar extensions& <e$ et al&
@*AAAB also sho5ed that 2onsu$er %elief in strong and high /ualit" %rands 2o$1ensated
inter!ening fa2tors su2h as la2k of dire2t 1rodu2t kno5ledge in e!aluating a %rand extension&
?o$%run and Nan 7iel @1)).B illustrated the 2on2e1t of %rand Ire1utation& 'he" 1osit that
re1utation is an out2o$e of 2onsistent 1rodu2t /ualit", the fir$s $arketing a2ti!ities es1e2iall"
relationshi1 $arketing that 1ro!ide 2onsu$ers 5ith greater risk relief and en2ourage $ore
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Brand Extensions: What Works and What Doesnt
1ositi!e e!aluations than %rands of lo5er re1utation and therefore %rand extensions are also
e!aluated in ter$s of 1arent %rand re1utation& Heller and Aaker @1))*B also generali3e that high
I/ualit" and Itrust5orth" %rands hold strong %rand asso2iations and these asso2iations are easil"
transfera%le to di!erse 2ategories and resist dilution& <o5e!er a22ording to Park et&al @1))1B,
there exists a %order line 5here the %rand 2on2e1t 2onsisten2" 1la"s a $ajor role in deter$ining
the a11ro1riateness of si$ilar and $ost i$1ortantl" dissi$ilar extensions& ?or instan2e, I6asio
6al2ulators 5ere 1er2ei!ed fa!ora%l" %e2ause of its rele!an2" of 2on2e1t of Ia22ura2" %et5een
5at2hes and 2al2ulators ho5e!er Ponds 'ooth1aste extension failed %e2ause of irrele!an2" of
Ponds %rand 2on2e1t 5ith res1e2t to 'ooth1aste 2on2e1t& #n addition, ?ar/uhar J <err @1))*B
found that a 1rotot"1i2al %rand 5hi2h t"1ifies a 1arti2ular 1rodu2t 2ategor" is diffi2ult to extend
%e2ause of its narro5 %rand $eaning& ?or instan2e, #ntel had to 1ull out fro$ 2onsu$er
ele2troni2s, to"s and digital 2a$eras %e2ause #ntel 5as 1er2ei!ed to %e 1arti2ularl" li$ited to
2o$1uter 1ro2essor te2hnolog"& A22ording to ?ar/uhar J <err @1))*B, these $aster or
1rotot"1i2al %rands hold a fir$ asso2iation in the 2onsu$ers $inds in a 5a" that 5hene!er the"
look for a 1arti2ular attri%ute or a %enefit, that 1arti2ular asso2iation %rings $aster %rand to the
$ind& 'he literature resear2h findings also sho5 so$e dire2tion in ter$s of effe2t of unfa!ora%le
%rand extensions on 1arent %rand& 7o$eo @1))1B and Heller and Aaker @1))*B studied the effe2ts
of unsu22essful extensions on e!aluation of a 1arent %rand and found no negati!e or 1ositi!e
effe2ts 5hen the extension 5as in the dissi$ilar 2ategor"& 'hese studies sho5 that des1ite
re2ei!ing and 1ro2essing negati!e infor$ation a%out a %rand extension, 2onsu$ers did not
e!aluate the 1arent %rand na$e differentl"& 4oken and John @1))*B stud" also sho5s that 1arent
%rand dilution o22urs 5hen extension 5as in the si$ilar 1rodu2t 2ategor" i&e&, 5hen extension
generated ex1e2tations in2onsistent 5ith the 2ore %rand& #n other 5ords, si$ilar extensions
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Brand Extensions: What Works and What Doesnt
re1resent an area 5here the 2o$1an" is dee$ed to ha!e a 2onsidera%le ex1ertise and 2onsu$er
2onfiden2e in the 1arent %rand is $ore likel" to %e 5eakened as a result of a failed si$ilar, rather
than dissi$ilar extension. #n addition, risk of %rand dilution is greater for 2ertain %eliefs for !er"
s1e2ifi2 and distin2ti!e attri%utes @e&g&, softnessB than %eliefs related to $ore glo%al and a%stra2t
attri%utes @e&g&, /ualit"B& Heller and :ood @*AA=B, 1osit that %rand e!aluations are onl" diluted
5hen the extension is in si$ilar 2ategor" %ut not 5hen extensions are in a dissi$ilar 2ategor"&
'he" 1osit that o!erallO 1arent %rands are less !ulnera%le to failed %rand extensions& Pi$$er and
Bhat @*AA>B also 1ro!e that attitude to5ard the 1arent %rand is si$ilar or har$less 5hen
extended to dissi$ilar 2ategories there%" su11orting the results of Heller and Aaker @1))*B that
failure of %rand extension usuall" does not affe2t 1arent %rand e!aluations& A1art fro$ 2ategor"
si$ilarit", 2ertain %rand $oderating fa2tors also inter1la" for dilution& A22ording to 6hang
@*AA*B, Iflagshi1 or Ioriginal 1rodu2ts are relati!el" i$$une to dilution as the" are shielded on
a22ount of ha!ing 5ell+esta%lished %rand kno5ledge stru2tures& :heinin @*AAAB sho5s that high
fa$iliarit" of the 1arent %rand leads to less dilution %" an unfa!ora%le extension than unfa$iliar
1arent %rands& ;n the %asis of 1re!ious literature, it 2an %e reasona%l" 2on2luded that high
/ualit", strong, fa!ora%le and trust5orth" %rands are less 1rone to dilution es1e2iall" 5hen
extensions are $ade into dissi$ilar 1rodu2t 2ategories kee1ing in !ie5 2onsu$er fa2tors su2h as
2onsu$er lo"alt" and ex1erien2e, diagnosti2it" and in2onsisten2"&
2." Cons!#er Characteristics
4iterature resear2h also re!eals the role of 2ertain 2onsu$er 2hara2teristi2s related to %rand
extension& A22ording to Muthukrishnan and Weit3 @1))AB, su22ess of %rand extension de1ends on
the 2onsu$er kno5ledge& IEx1ert e$1hasis $ore on 2on2rete and fun2tional 2o$$onalities
%et5een the 1arent %rand and the extension 5hile I8o!i2e 2onsu$ers e!aluate $ore on surfa2e
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Brand Extensions: What Works and What Doesnt
features su2h as sha1e, si3e, 2olor, et2& and 1er2ei!e greater fit %et5een si$ilar extensions&
Broniar2"3k and Al%a @1))>B also de$onstrate that 1er2e1tion of fit relies on 2onsu$ers
kno5ledge a%out the 1arent %rand and in the a%sen2e of su2h kno5ledge the" rel" on a11arent
i$age and features of the 1rodu2t, le!el of a5areness and $ore a%stra2t asso2iations in
e!aluating an extension& Hir$ani et al& @1)))B sho5 that o!erall Io5ners of the 1arent %rand
ha!e fa!ora%le 1er2e1tions to5ards line extension than Inon+o5ners& 'he stud" also sho5 that,
I;5ners are $ore rea2tionar" to5ards u15ard and do5n5ard stret2h and rea2t negati!el"
to5ards do5n5ard stret2h of 1restige %rand su2h as Hel!in Hleins do5n5ard extension&
Ahlu5alia and Gurhan+6anli @*AAAB un2o!er the fa2t that extensions negati!e e!aluations
de1end on the extent of 2onsu$ers in!ol!e$ent 5ith the ex1erien2e& When 2onsu$ers are less
$oti!ated or the %u"ing de2ision does not re/uire high in!ol!e$ent then negati!e e!aluations
o22ur onl" 5ith si$ilar extensions as the" 2onsider dissi$ilar extensions to %e Iex2e1tions and
gi!e the$ a I%enefit of dou%t& #n addition, the" found that 5hen 2onsu$ers engage in a2ti!e
1ro2essing of negati!e infor$ation a%out the extension then negati!e e!aluations o22ur
regardless of extension si$ilarit"&
2.$ Brand Extension Co##!nication
4iterature resear2h also 1ro!ides !alua%le insights in de!elo1ing effe2ti!e 2o$$uni2ation
strategies for %rand extensions& Aaker and Heller @1))*B 1osit that $ost effe2ti!e 2o$$uni2ation
strateg" for i$1ro!ing 2onsu$ers e!aluations a%out a %rand extension is to highlight 1arti2ular
extension attri%utes for 5hi2h 2onsu$ers are 2on2erned& <o5e!er, Heller @1))=B ex1lains that
effe2ti!e 2o$$uni2ation strateg" is de1endent on the salient asso2iations and the nature of the
%rand+to+extension relationshi1& A22ording to the author, re2ogni3ing alread" existing salient
1arent %rand asso2iations and esta%lishing rele!ant ex1lanator" links in the extension 2ategor" is
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Brand Extensions: What Works and What Doesnt
likel" to ho$e su22ess& #n addition, a22ording to Bridges et al& @*AAAB, attri%ute illustrating
2o$$uni2ation strateg" is $ore likel" to %ridge the 1arent+extension ga1& 'he" also 1osit that
IEla%orational 6o$$uni2ation :trateg" is effe2ti!e 5hen 1arent %rand non+attri%ute
asso2iations are extended to a 2ategor" ha!ing no 2on2rete attri%utes in 2o$$on& :i$ilarl",
I7elational 6o$$uni2ation :trateg" is %est suited 5hen the 1arent %rand non+attri%ute
asso2iations are extended to a 2ategor" 5ith 1h"si2al attri%utes in 2o$$on& 4ane @*AAAB
de$onstrates that for slightl" in2ongruent extensions, ex1osures to %oth 1eri1heral and %enefit
sought results in i$1ro!e$ent in the 2onsu$er 1er2e1tion of fit& #n 2ase of drasti2all"
in2ongruent extensions, re1eated ad!ertising strateg" fo2using on %enefits redu2es in2ongruen2"&
?inall", 'a"lor and Bearden @*AA=B ha!e sho5n that large ad!ertise$ent s1ending 5as e!aluated
1ositi!el" for si$ilar extensions %ut not for dissi$ilar extensions as 2onsu$ers %e2a$e ske1ti2al
a%out the /ualit" of a dissi$ilar extension&
". Brand Extension A%%ication
#n this se2tion, the 2on2e1ts and insights fro$ the literature re!ie5 on %rand extension are %eing
a11lied to a real %rand& 'he 2hosen %rand is 6ater1illar, one of the leading %rands in earth$o!ing
industrial, 2onstru2tion e/ui1$ent as 5ell as in 2onsu$er seg$ents of 5ork %oots& ;!er the
"ears, 6ater1illar has %e2o$e one of the $ost su22essful %rands in extending its 1rodu2ts into
si$ilar and dissi$ilar 2ategories& 'he literature resear2h shall %e a11lied to 6ater1illar extension
into dissi$ilar 2ategories&
".1 Cater%iar and its Brand Extensions
Page 1= of *.
Brand Extensions: What Works and What Doesnt
6ater1illar 5as founded in 1C)A %" Benja$in <olt and Daniel in 6alifornia, :A as a
$anufa2turer of stea$ tra2tors for far$ing using self+la"ing tra2ks& 'hrough 2ontinuous
inno!ation in its 2ore te2hnologies and adheren2e to stri2t /ualit" 2ontrol along 5ith su11orting
$arketing 1rogra$s, strong 2usto$er relationshi1 $anage$ent and 6ater1illar tra2tor usage in
eras and situations su2h as ?irst World War and its 1arti2i1ation in $age 1roje2ts su2h as Golden
Gate Bridge, 6hannel 'unnel and 'hree Gorges Da$ in 6hina not onl" earned the 2o$1an" a
leader in earth$o!ing $a2hiner" and e/ui1$ent seg$ent %ut also %rought in an unargua%le
2redi%ilit" and re1utation to the 2o$1an"& #ts 2ontinuous $oderni3ation and di!ersifi2ation %"
extending its 1rodu2t line length through se!eral Joint Nentures and 'ransfer of 'e2hnologies and
se!eral $anufa2turing allian2es in different 1arts of the 5orld has earned the 2o$1an" a strong
footing in ea2h of the industrial 1rodu2t 2ategor"& 'he 2o$1an" also $o!ed to other areas
in2luding 6ater1illar ?inan2ial :er!i2es, 6ater1illar #nsuran2e and 6ater1illar :er!i2e
'e2hnologies $ainl" to su11ort its dealers around the 5orld& #n addition, 6ater1illar also
esta%lished 6ater1illar 4ogisti2 :er!i2es di!ision that 1ro!ides logisti2s solutions to 6ater1illar
itself and other 2o$1anies as 5ell& #n late CAs, the 6ater1illar started %uilding a strong identit"
s"ste$ 5here the 6A' trade$ark 5as used 2onsistentl" in order to in2ul2ate res1onsi%ilit" and
1ride in its stakeholders& Brand 2onsisten2" stressed 5ith s1e2ifi2 guidelines for logo use,
signage and design issues resulted in enor$ous %rand re2ognition&
'oda", 6ater1illar has around .,,AAA e$1lo"ees, al$ost 1AA,AAA dealers, and thousands of
agents a2ross six 2ontinents& #t has *CA o1erations in >A 2ountries and $ore than ,AD of its sales
2o$e fro$ outside the :, 5here $ore than * $illion 6ater1illar $a2hines are at ea2h da",
2learl" de1i2ting its 1osition as a glo%al su1re$a2" in earth$o!ing and industrial $a2hiner"
Page 1> of *.
Brand Extensions: What Works and What Doesnt
6ater1illars 2ontinuous su22ess in its %usinesses has earned it strong, uni/ue and fa!ora%le
asso2iations in the $inds of the 2onsu$ers 5ord 5ide& #n other 5ords, "ears of %rand %uilding
efforts resulted in de!elo1$ent of strong %rand kno5ledge stru2tures 5hi2h 2learl" translate into
Idura%ilit", relia%ilit" and ruggedness on a 2on2rete le!el as 5ell as I/ualit", 2redi%ilit",
2onsideration, se2urit", trust and 1ride on a $ore a%stra2t le!el& #n 1))>, the 2o$1an" $o!ed
into 2onsu$er+oriented 1rodu2ts, 5ork 5ear 1rodu2ts, %" su22essfull" le!eraging these
asso2iations into its ne5 a11arel %rand extensions and earned re2ord sales of E1 %illion
5orld5ide& #ts su22ess in 5ork %oots has %een rated as the one of the $ost su22essful %rand
extension in the histor" of %randing 5here a total of ,- $illion foot5ear 5ere sold in 1))> alone&
#ts re2ent introdu2tion of hea!" %ike kno5n as I6A' 6ho11er has attra2ted i$$ense 1o1ularit"
and a22ording to industr" anal"sts, 6A' 6ho11er is the toughest and $ost rugged %ike e!er
1rodu2ed& #n *AA,, 6ater1illar further extended its %rands that in2luded %atter"+o1erated light
and sound and re$ote+and+radio+2ontrolled !ehi2les, %i2"2les, tri2"2les, and 5agons, sand%ox
to"s, traditional and intera2ti!e %ooks, role+1la" to"s, further extension of its a11arel line and
introdu2tion of 6at e"e5ear %" introdu2ing industrial safet" e"e5ear&
6ater1illar uni/ue su22ess and 1ro$inen2e in t5o different seg$ents $akes it a $ost rele!ant
%rand to a11l" resear2hers findings and there%" un!eiling underl"ing 1heno$ena of its %rands
su22ess& 'herefore, a h"1otheti2al extension of 6A' Work Jeans is 1ro1osed and e!aluated in
the light of literature resear2h and 6ater1illar i$age as 5ell as its existing extensions&
".1.1 Cater%iar Cons!#er Extensions and Pro%osed Wor& 'eans Brand
Page 1, of *.
Brand Extensions: What Works and What Doesnt
#n ter$s of 1arent %rand dilution, it 2an %e i$1lied fro$ Heller and Aaker @1))*B, ?o$%run Nan
7eal @1)).B, <e$ et& al @*AAAB and 7east @*AA,B studies that 6ater1illar %rand is kno5n for high
/ualit", 2redi%ilit" and enjo"s high re1utation and holds strong and fa!ora%le %rand asso2iations&
#t 2an %e i$1lied that o5ing to su2h a high /ualit" i$age it %e2a$e easier for 6ater1illar to
extend to di!erse and distant 2ategories su2h as 5ork %oots, e"e5ear et2& #t 2an also %e i$1lied
that these %eliefs 1ro!ided 2usto$ers 5ith greater risk relief and therefore 2o$1ensated ?M6G
2onsu$ers la2k of 1rodu2t kno5ledge and other inter!ening fa2tors in e!aluating its dissi$ilar
extensions& ;!er the "ears, 6ater1illar has extended into si$ilar 1rodu2t 2ategories su2h as
$a2hines, engines, 1o5er generation, tools, tur%ines, allied e/ui1$ent, used e/ui1$ent,
te2hnolog" and ;EM solution in order to di!ersif" and %uild an Iout+of+%ox i$age and di$inish
a stig$a of a 1rotot"1i2al %rand that 5as related to 2onstru2tion $a2hiner" onl"& #n 2ase of
industrial $arket it is still !er" $u2h kno5n for its flagshi1 1rodu2t 2ategor" of earth $o!ing
e/ui1$ent, ho5e!er its skillful strateg" of highlighting $ore a%stra2t asso2iations su2h as
Idura%ilit" and ruggedness and then transfor$ing into a Ilifest"le i$age has led it to %roaden its
%rand $eaning& #n other 5ords, these Is$all ste1s ha!e $oderated 6ater1illars 1rotot"1i2alit"
i$age to /uite an extent and has extended its %rand $eaning %oundaries 5hi2h is in 2onjun2tion
5ith the studies of ?ur/uahar J <err @1))*B& 'his $eans that 6ater1illar 2an extend to areas
5here its 5ell+de!elo1ed 1arent %rand the$e is a11li2a%le& ?or instan2e, the I6A' <o11er, a
re2entl" introdu2ed hea!" %ike is like a It5o+5heeled offs1ring of a %ulldo3er& 'hese
%oundaries are !er" li$ited to other reno5ned earth$o!ing e/ui1$ent %rands su2h as Ho$atsu
%e2ause of its li$ited and 2on2rete %rand asso2iations %uilt o!erti$e& 'herefore, 6A' Work Jeans
5ill %e 1ortra"ing the sa$e i$age of Idura%ilit" and ruggedness as 5ell as Ilifest"le& <o5e!er,
e!en if this dissi$ilar 1rodu2t extension totall" fails in the e"es of the 2onsu$ers, the 6ater1illar
Page 1- of *.
Brand Extensions: What Works and What Doesnt
%rand i$age is likel" to %e unhar$ed a22ording to the findings of 7o$eo @1))1B and Heller J
Aaker @1))*B& A11l"ing 4oken and John @1))*B and it 2an %e inferred that 6ater1illar %rand
i$age 2ould ha!e %een seriousl" da$aged if its line extension su2h as ex2a!ators had failed
%e2ause %u"ers in industrial seg$ents 5ho ha!e i$$ense faith in 6ater1illars 2ore ex1ertise in
$anufa2turing earth$o!ing e/ui1$ent 5ould ha!e %een 2ertainl" taken a%a2k %" this failure and
there 5ould ha!e %een a greater 2han2e of 1arent %rand dilution& ;n the other hand, Jeans or
other 6ater1illars a11arel %rand 5hi2h does not de1i2t 6ater1illars 2ore 2o$1eten2" i$age of
industrial $a2hiner" is unlikel" to hurt 6ater1illars o!erall i$age as 2onsu$ers 5ould find it
hard to esta%lish a negati!e relationshi1 %et5een the t5o %rands 5hi2h is in a22ordan2e 5ith the
findings of 4oken and John @1))*B& ?urther, in light of Heller J :ood @*AA=B, Pi$$er and Bhat
@*AA>B, 6hang @*AA*B and :heinin @*AAAB findings, it 2an %e reasona%l" assu$ed that the strong
%rand i$age of 6ater1illar %rand shall re$ain unhar$ed if the existing and 1ro1osed %rand
extension of 5ork jeans fails& 6onse/uentl", it 2an %e i$1lied that 6ater1illar "ears of %rand
%uilding a2ti!ities ha!e led its 2usto$ers de!elo1 5ell+learned %rand kno5ledge stru2tures that
2an 5ithstand negati!e i$1a2t of failed %rand extension along 5ith the fa2t that 2onsu$ers 5ill
%e less diagnosti2 due to 1arent %rand and extension dissi$ilarit" as 5ell as the" shall %e $ore
forgi!ing in 2ase of failure of 1ro1osed %rand&
#n ter$s of %rand extension 2hara2teristi2s, Aaker J Heller @1))AB 2on2e1t of I6o$1li$entarit"
2an %e a11lied 5here the existing %rand extensions and the 1ro1osed 5ork jeans are likel" to
1ro!ide an o11ortunit" to the users of 6ater1illar $a2hiner" and e/ui1$ent, e$1lo"ees as 5ell
as its 2onsu$ers to 5ear jeans together 5ith the 1arent %rand as 5ell as 5ith other extensions&
?or instan2e, the 2onsu$ers 5ould %e a%le to 2o$1li$ent 6ater1illar %oots, a11arel, e"e5ear and
Page 1. of *.
Brand Extensions: What Works and What Doesnt
1ro1osed jeans together there%" enjo"ing an Ia%solute %rand+self i$age& 'he 2on2e1t of
I'ransfera%ilit" is a11li2a%le to 6ater1illar 5hi2h has a strong i$age of engineering 2a1a%ilit",
dura%ilit", te2hnolog" and ex1ertise to introdu2e a /ualit" and relia%le 2onsu$er 1rodu2ts su2h
as other extensions and 5ork jeans& Additionall", in a22ordan2e 5ith Broniar2"3k and Al%a
@1))>B and Brodie and Gl"nn @1))CB studies, 6ater1illars salient %rand asso2iations su2h as
Idura%ilit" and ruggedness 5ere su22essfull" transferred to its existing extensions and therefore
2an %e transferred to 5ork jeans 1rodu2t 2ategor" that shares si$ilar asso2iations& #t 2an %e
i$1lied %" stud"ing Park et& al @1))1B and ?ar/uhar J <err @1))*B results and 2o$1aring it 5ith
6ater1illar o!er all %rand i$age that 6ater1illar %rand is relati!el" $ore of fun2tional %rand than
a 1restige %rand on a 2ontinuu$& ;!er the "ears its 2o$$uni2ation and $arketing strateg" has
strongl" ela%orated attri%utes that translated into su1erior 1erfor$an2e under extre$e 2onditions
rather than 1restige and therefore these salient and tangi%le asso2iations 5ere su22essfull"
transferred to si$ilarKdissi$ilar 2ategories do$inating su2h asso2iations su2h as 5ork %oots and
hea!" $otor%ikes& :i$ilar analog" 2an %e a11lied to the 1ro1osed extension of 5ork jeans&
6ater1illar 2onsu$er %rand extensions 2an %e 5ell understood in light of the studies of Bridges
et& al @*AAAB and Martin et& al @*AA,B, 5here it 2an %e i$1lied that 2onsu$ers of 6ater1illar
1rodu2ts esta%lish link %et5een 2ategories in 5hi2h Idura%ilit" and ruggedness are do$inant
features as 5ell as de!elo1 a goal+deri!ed 2ategori3ation fra$e5ork 5here the goal in 2ase of
a11arel %rands is to feel 2onfident under rugged and tough 2onditions as 5ell to sho5 a 1arti2ular
Ilifest"le of feel+and+look rugged and tough& 'herefore it 2an %e assu$ed that su2h 2onsu$ers
5ill look for 6ater1illar 1rodu2ts in all those 2ategories sharing the sa$e the$eKgoal& 'his
2on2lusion strongl" fa!ors the introdu2tion of 5ork jeans exhi%iting the sa$e the$e and goal&
'he goal+deri!ed 2on2e1t of 1er2e1tion of fit is /uite !i!id in 6ater1illar Wat2h %rand and
Page 1C of *.
Brand Extensions: What Works and What Doesnt
6ater1illar E"e5ear 5hi2h re2ei!ed 1ositi!e e!aluations and 1u%li2 a22lai$& 'his is also in
2onjun2tion 5ith <arle" Da!idson extension into %oots and %ike ja2kets %oth of 5hi2h 1ortra" an
Ioutla5 i$age that %inds outla5 oriented 1eo1le&

#n ter$s of 1ri2ing, 6ater1illar follo5ed a $arket ski$$ing 1ri2ing strateg" for its 5ork %oots
5at2hes, e"e5ear et2& i&e these 1rodu2ts 5ere 1la2ed on a higher 1ri2e side 5hi2h resulted in
1ositi!e /ualit" e!aluations %" its 2usto$ers& 'his 2orres1onds to the results of 'a"lor and
Bearden @*AA*B stud" that higher 1rodu2t 1ri2ing in a dissi$ilar 2ategor" resulted in fa!ora%le
2onsu$er e!aluations for the 1arent %rand& 'his i$1lies that the 1ro1osed 5ork jeans should %e
relati!el" high+1ri2ed in order to %e 1er2ei!ed as a high /ualit" %rand&
7elating literature resear2h 1ertaining to 6ater1illars 2onsu$er 2hara2teristi2s sho5s so$e
interesting insights& Before 1))>, 6ater1illars 2usto$ers %elonged to the industrial se2tor& :in2e
%usiness+to+%usiness deals in an industrial se2tor 2arr" su%stantial ex1enditures and 1oses a dire2t
i$1a2t on the %u"er organi3ations 1rodu2ti!it", therefore su2h 1ur2hases re/uire extensi!e
e!aluation of s1e2ifi2 features of the 1rodu2t and usuall" organi3ations hire ex1ert 1ro2ure$ent
$anagers for e!aluation and s2rutini3ing& 'herefore, sellers in industrial seg$ent highlight $ore
2on2rete and 1erfor$an2e features in their $arketing 2o$$uni2ations& :in2e 6ater1illar entered
into a 2onsu$er seg$ent for the first ti$e, therefore all its 2usto$ers 2an %e dee$ed as
2o$1letel" I8o!i2e 5ho had li$ited 2on2rete %rand kno5ledge and therefore in light of
Muthukrishnan and Weit3 @1))AB and Broniar2"3k and Al%a @1))>B studies, it 2an %e i$1lied that
in 2ase of 5ork %oots the" relied $ore on glo%al as1e2ts su2h as o!erall i$age of the 6ater1illar
%rand as 5ell as its extensions 1h"si2al a11earan2e& #t is /uite likel" that this 2ould %e the reason
Page 1) of *.
Brand Extensions: What Works and What Doesnt
that 6ater1illar designed a uni/ue "ello5 2olor 6A' logo, a tra2tor tra2k rese$%ling lo5er sole
and Idigger sha1ed u11er sole for its 5ork %oots that resulted in 1ositi!e res1onse fro$
2onsu$ers& :i$ilar inferen2e 2an %e 1redi2ted for the 1ro1osed 5ork jeans& <o5e!er this
generali3ation is so$e5hat 2ontrar" to Muthukrishnan and Weit3 @1))AB stud" 5hi2h sho5ed
that this %eha!ior o22urred 5hen the extension 5as in si$ilar 2ategor"& As a $atter of fa2t, it is
/uite diffi2ult to relate and a11l" resear2h findings related to 2onsu$er 2hara2teristi2s on
6ater1illar %rand %e2ause it 5ould re/uire in+de1th kno5ledge of its 2usto$ers as 5ell its %rand
histor"&

6ater1illar 2o$$uni2ation strateg" for its 5ork %oots initiall" fo2used $ore on esta%lishing a
link %et5een its o!erall i$age of Idura%ilit" and ruggedness and its 5ork %oots rather than
%oasting the o!erall /ualit" of the 6ater1illar& 'he first ad!ertise$ent 2a$1aign le!eraged 6A's
5ork %oots slogan as L;ne 'ough BootM& 'his strateg" 2an %e justified in light of Bridges et al&
@*AAAB and 2an %e ter$ed as I7elational 6o$$uni2ation :trateg"& #t 2an %e i$1lied that
6ater1illars industrial 1rodu2ts and its 5ork %oots extension shared si$ilar attri%utes of %eing
rugged and tough ho5e!er 6ater1illars o!erall %rand i$age 5as restri2ted to industrial
$a2hiner" 1rodu2ts and therefore for ne5 2onsu$ers there 5as so$e5hat la2k of 2onne2tion
%et5een the 1arent %rand 2ategor" and the 5ork %oots 2ategor"& 6o$$uni2ating salient and
2on2rete feature i&e&, Itough $ight ha!e hel1ed in esta%lishing 1h"si2al relationshi1 and
edu2ating 2usto$ers that resulted in in2reased 2onsu$er a22e1tan2e of an extre$el" dissi$ilar
2ategor" of 5ork %oots& 'his strateg" 2an also %e justified through 4anes @*AAAB anal"sis that
6ater1illars fo2us on 2o$$uni2ating %enefits of 5ork %oots rather than re$inding the 1arent
%rand i$age resulted in in2reased 1er2e1tion of fit and fa!ora%ilit"& 6ater1illars $arketing
Page *A of *.
Brand Extensions: What Works and What Doesnt
strateg" for its 5ork %oots and other a11arel 5as then fo2used on highlighting Ilifest"le i$age
for its 2onsu$er %rands rather than 2on2rete asso2iations and %enefits 5hi2h led to a
2orres1onding 2hange in its ad!ertising strateg" 5here one of ads said L6at shoes talk it like the"
5alk itM& 6onse/uentl", for the 1ro1osed 5ork jeans %rand, Irelational 2o$$uni2ation strateg"
5ould 5ork during the introdu2tor" 1hase and later on the ad!ertise$ent 2ould highlight the
lifest"le or attitudinal ele$ents& Although there is no infor$ation a%out 6ater1illar ad!ertising
%udget and its strateg" for its 2onsu$er %rands ho5e!er a22ording to 'a"lor and Bearden @*AA=B
stud", the jean ad!ertise$ent fre/uen2" 5ould %e 2ontrolled in order to 1reser!e the o!erall
i$age of 6ater1illar&

6ater1illar 2onsu$er %usiness strateg" and 1erfor$an2e $at2hes 5ith the literature resear2h to
/uite an extent and its su22ess not onl" !alidates the 1re!ious studies %ut also 1ro!ides ke"
guidelines for a su22essful %rand extension& 'here are so$e findings in the literature resear2h
5hi2h see$ to %e at loggerheads 5ith 6ater1illars extension strateg"& ?or instan2e, a22ording to
Aaker and Heller @1))AB, 5hen a high /ualit" 1arent %rand introdu2ed 1rodu2ts that see$ed to %e
eas" to $ake then 2onsu$ers negati!el" e!aluated the %rand extension& :in2e 5ork %oots,
a11arel, e"e5ear, %a%" 5ear is relati!el" eas" 1rodu2ts to $ake for a 2o$1an" like 6ater1illar,
the i$age of the 2o$1an" should ha!e %een diluted& #n addition, 6ater1illar entr" into %a%" 5ear
is an extension %e"ond its %oundaries as Idura%ilit" and ruggedness does not $at2h 5ith the
desired attri%utes of 2hildren 5ear 2ategor" 5hi2h is usuall" do$inated %" the attri%ute Isoftness
and 2usto$er goal of I2o$fort& Aaker and Heller @1))AB stud" also sho5ed that 2onsu$ers 2an
%e literal in e!aluating a %rand extension as su%je2ts in their stud" ex1e2ted <eineken Po12orns
to taste like <eineken %eer& #n light of literature resear2h, an at"1i2al extension is likel" to %e
Page *1 of *.
Brand Extensions: What Works and What Doesnt
negati!el" e!aluated and a22ording to Heller @*AA=B, 5ith the 1assage of ti$e these 2onfusing
extensions su2h as 6ater1illars u12o$ing traditional and intera2ti!e %ooks $ight %lur o!erall
i$age of 6ater1illar 2onsu$er %rands& :i$ilarl" the 1ri2ing strateg" of 6ater1illars 2onsu$er
%rands see$s to %e in2onsistent& 6ater1illar 5ork %oots, e"e5ear and to"s ha!e %een 1ri2ed
higher relati!e to the res1e2ti!e 2o$1etitors in ea2h 1arti2ular 2ategor" %ut in 2ase of %a%" 5ear
its 1ri2e has %een lo5er than the 1re!ailing 1ri2es 5hi2h is also against the resear2h findings and
it 2an %e ex1e2ted that 6at %a%" 5ear %rand 5ill %e unsu22essful&
Page ** of *.
Brand Extensions: What Works and What Doesnt
CONCLU(ION
'he theoreti2al a11li2ation of literature resear2h in %rand extension re!eals the fa2t that %rand
extensions are likel" to %e $ost su22essful 5hen there is a Ifit %et5een the 1arent %rand and the
%rand extension& 'his fit is de1endent on 2onsu$ers 1er2e1tions of the 1arent %rand ex1ertise in
$aking the extension as 5ell as extension 2onsisten2" 5ith the I2on2e1t of the 1arent %rand& #n
general, these %rand 2on2e1ts 2an %e graduall" transfor$ed fro$ 2on2rete asso2iations to
a%stra2t asso2iations su2h as goal deri!ed or on the %asis of shared !alues and o!erall hori3on of
the 1arent %rand 2an %e graduall" %roadened and extended to si$ilar and dissi$ilar 2ategories& #t
2an also %e i$1lied that I%rand in %rand extension is su1erior to 2ategor"+%ased si$ilarit" and fit
is de1endent on 5hat resides in the $inds of the 2onsu$ers& #n addition, re1utation of a 1arent
%rand has %een found to %e a 2ru2ial fa2tor in %rand extension su22ess& 'herefore, 2onsistentl"
%uilding strong, uni/ue and fa!ora%le asso2iations of the 1arent %rand that translate into
2ontinuous fulfilling of I%rand+1ro$ise 5ill result in su22essful %rand extensions as 5ell as
resist dilution in 2ase of extension failure& 6onsu$ers %rand kno5ledge and ex1erien2e, their
1er2e1tion of risk and their attitude to5ards 1ri2e are i$1ortant fa2tors that influen2e their
judg$ents to5ards %rand extensions& ?or instan2e, for high /ualit" %rands high+1ri2ed extension
has %een found to %e fa!ora%le& ?inall", de!elo1ing rele!ant 2o$$uni2ation literature, !isual
2ues and ad!ertising along 5ith effe2ti!e 2usto$er relationshi1 $anage$ent te2hni/ues are $ore
likel" to generate fa!ora%le res1onses to5ards dissi$ilar %rand extensions&
Page *= of *.
Brand Extensions: What Works and What Doesnt
)UTURE RE(EARC*
'he a11li2ation of literature resear2h on 6ater1illar 2onsu$er extensions highlights 2ertain
li$itations& Most of the literature on %rand extension is %ased on 2onsu$er 1rodu2ts or ?M6G
and there is a la2k of resear2h on Business+to+6onsu$er %rand extensions& More s1e2ifi2all",
i$1a2t of Business+to+6onsu$er extensions on existing industrial extensions as 5ell as on
industrial 2onsu$ers should %e exa$ined in order to judge the a11li2a%ilit" of existing
generali3ations& Also, it 5ould %e 5orth5hile to find out 1ros and 2ons of %rand extensions fro$
6onsu$er+to+Business seg$ents& ?or instan2e, 'i$%erland extending into earth$o!ing
e/ui1$ent& ?urther, the relationshi1 %et5een 1re!ious and existing %rand extension needs to %e
ex1lored in order to find out if the su22ess or failure of an"one or $ore of si%ling extensions
i$1a2ts 2onsu$er e!aluations of ne5 and existing %rand extensions& 'he re!ie5 of literature
resear2h also highlights the fa2t that relati!el" little resear2h has %een 2ondu2ted on a11ro1riate
1ri2ing, 1ro$otion and distri%ution ele$ents of %rand extensions under different s2enarios& #n
other 5ords, %rand extension 1ositioning re/uires further ex1loration& Another %ig /uestion that
e$erges fro$ literature resear2h is that are these findings generali3a%le a2ross all 1rodu2t
2ategories as 5ell as a2ross all 2onsu$er seg$ents& Another i$1ortant short2o$ing of %rand
extension literature is its la2k of ex1loration a%out %rand extensions and different 2ultures& #n
other 5ords, $an" %rands ha!e gone glo%al and ha!e ado1ted a strateg" of Iglo2ali3ation i&e&,
adding a fla!or of lo2al 2ultures in their %rands as 5ell as in their 2o$$uni2ations and therefore
%rand extensions $ight also re/uire Ituning and 2hanges in s1e2ifi2 ele$ents o5ing to !ar"ing
e!aluations of %rand extensions %" 2onsu$ers %elonging to different 2ultures& ?uture resear2h
5hi2h 2o$1rehensi!el" ex1lores the a%o!e+$entioned areas and a$alga$ates 1re!ious literature
resear2h is likel" to 1ro!ide in!alua%le guidelines in the field of %rand extension&
Page *> of *.
Brand Extensions: What Works and What Doesnt
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Brand Extensions: What Works and What Doesnt
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