Question: What Is An Example Of Extension Strategy?

What is the difference between brand extension and line extension?

A product line extension is the use of an established product brand name for a new item in the same product category.

This is as opposed to brand extension which is a new product in a totally different product category.

Line extension occurs when the company lengthens its product line beyond its current range..

What are the 5 pricing strategies?

Types of Pricing StrategiesCompetition-Based Pricing.Cost-Plus Pricing.Dynamic Pricing.Freemium Pricing.High-Low Pricing.Hourly Pricing.Skimming Pricing.Penetration Pricing.More items…•

What is straight extension strategy?

In straight extension the same product is marketed to all countries (a “world” product), except for labeling and language used in the product manuals. The assumption behind this strategy is that consumer needs are essentially the same across national boundaries.

What are the components of brand extension?

A comprehensive literature review identifies six elements which are crucial to the success of brand extension. These elements are Parent Brand Image, Parent Brand Fit, Parent Brand Strength, Marketing Support, Quality of Parent Brand and Parent Brand Consumer Experience.

What is an example of brand extension?

A brand extension (some times called a category extension) is when a brand is known for one type of product starts selling a different type of product. Some example of brand extension are: Apple: from personal computers into MP3 players. Callaway: from golf clubs into footwear, apparel and golf accessories.

What is meant by brand extension?

A brand extension is when a company uses one of its established brand names on a new product or new product category. It’s sometimes known as brand stretching.

Why are extension strategies important?

A branded good can enjoy continuous growth, such as Microsoft, because the product is being constantly improved and advertised, and maintains a strong brand loyalty. Extension strategies extend the life of the product before it goes into decline. Again businesses use marketing techniques to improve sales.

What are product life cycle extension strategies?

An extension strategy will involve amendments to the marketing mix such as upgrading or updating the product, changing the packaging or presentation, adding new features or new design elements or lowering price. Figure 2 shows the impact of the extension strategies on the product life cycle.

What is the role of brand extension?

Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. … It increases awareness of the brand name and increases profitability from offerings in more than one product category.

Why do brand extensions fail?

1 reason why some brand extensions fail is simple: they don’t bring enough meaningful value to the consumer. … Its McPizza product flopped because consumers thought its value proposition was too similar to established competitors such as Domino’s and Pizza Hut.

Is brand extension good or bad?

Brand extension in unrelated markets may lead to loss of reliability if a brand name is extended too far. An organization must research the product categories in which the established brand name will work. There is a risk that the new product may generate implications that damage the image of the core/original brand.

What is a family brand example?

Family branding is a type of marketing tactic. It involves using one brand name to market multiple products. For example, a company may use one brand to market soap, lotion, hair shampoo, and nail polish. … For example, a company may sell lipstick and nail polish, giving each product line a separate marketing identity.

What are the types of brand extension?

8 Types Of Brand ExtensionSimilar Product In A Different Form From The Original Parent Product. … Distinctive Flavor/Ingredient/Component In The New Item. … Benefit/Attribute/Feature Owned. … Expertise. … Companion Products. … Vertical Extensions. … Same Customer Base. … Designer Image/Status.

What are 4 possible extension strategies?

Extension strategies include rebranding, price discounting and seeking new markets. Rebranding is the creation of a new look and feel for an established product in order to differentiate the product from its competitors.

What might be a disadvantage of brand extension?

Extending the brand name too far may lead to a loss of reliability, especially if the brand extension happens in an unrelated market. Thus, companies have to know which product categories will work and where they can actually use the brand name.