Brand extensions

Over the last decades, an increasing number of international companies have strived to capitalize on the value of their most real and marketable assets: their brands. Urged to withstand the pressure of intensifying global competition, various managers have thus chosen to pursue growth strategies based on the exploitation of equity inherent in their existing brands. Brand extensions defined as the use of established brand names to penetrate new product categories have become the preferred strategic alternative for such business expansion. While there is a large number of successful brand extensions substantiating the strategy’s popularity, there have also been significant marketplace failures of newly launched extension products. Which factors determine the potential success of an extension? What has to be taken into account when implementing a brand extension strategy? The authoress Carolin Wobben answers these questions by illustrating and analysing the relevant determinants of success and by giving guidelines for the planning and realisation of a brand extension strategy. The paper is addressed to Marketing students who look for a compedious insight into the topic of brand extensions as well as to strategic decision-makers of all companies.