Brand extension — or brand stretch — is a means for companies to enter new categories with existing brands. It is based on the premise that brands are valuable assets that can and should be strategically and selectively extended.
Rather than build a brand from scratch, stretch existing ones to new categories. This provides economic leverage, increasing the chance of new business success while also reducing costs.
Countless examples exist where brands have effectively extended into new product categories. When done right, it’s a win-win. Successful brand extensions build upon the equity of the parent brand and the entire portfolio benefits.
Business category analysis, focused ideation, and brand extension research are required inputs to stretching brands. When done effectively, brand extension should allow an organization to: