Brand Extention

I. Brand Extensions

Nowadays, Companies look more and more for brand extensions in order to get several advantages, both financial and marketing ones. Indeed they allow Companies to reduce risks and costs of launching new products and the investments in communication, increase incomes and market shares, strengthen the brand awareness.

Brand extensions increase the consumer perceived value of the brand. For successful brand extensions, consumers have to be able to perceive high fit between the extended product and the core brand. Thanks to this determinant the evaluation of the extension results credible and very likely to be based on the parent brand beliefs and the Customers will immediately infer the quality of the new offer. Aaker & Keller propose an attitude-based model in which describe fit as a key factor with attitude toward the original brand and perceived difficulty of making the extension. Other variables are involved in leveraging brand image in brand extensions as communication policy (Pina and Montaner 2009), brand type and cultural differences (Buil, De Chernatony and Hem 2009). In addition, Kapferer's model based on brand types demonstrates the importance for the brand to have a high brand meaning more adaptable and reliable into other categories. Finally Davidson and Taylor confirm this tendency, creating two models in order to prove the importance of a strong core in order to evolve successfully in to a broader brand.

Most brand extensions occur as line extensions, which use the existing brand names and products and extend them remaining in the existing product category. These extensions are seen as very low risk to both company and consumers due to low introduction costs and the target market product familiarity. Category extensions involve higher risks and costs, as both actual and potential consumers are motivated to buy very different products, which have been created from existing brand names and extended to new-product categories,...