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What is a brand extension? Explanation & Examples - YouTube
Channel: Rock Your Brand庐
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hey welcome to this video on brand
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extensions in this video I'm going to
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explain what a brand extension is and I
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will show you a very high profile large
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global brand who have used brand
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extensions well and later on how they
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field miserably with unattempted brand
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extension so what is a brand extension a
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brand extension is when business or an
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organization has a well-developed
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product or service and they leverage
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their brand name to introduce a new
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product or service into an industry
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sector that they aren't already in by
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doing this they can increase their brand
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equity so to explain that a little bit
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further let's take a look at that large
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global brand that I mentioned that brand
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is Colgate Colgate has been around for
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over 200 years now and they're a
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household name when it comes to the sale
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of toothpaste Colgate were the first
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company to pack their toothpaste into
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tubes up until then toothpaste was sold
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in jars or tins so you can thank Colgate
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for the fact that we have toothpaste in
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tubes to this day now we all know that
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in order to brush your teeth you need
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one other thing other than toothpaste
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and that's toothbrushes and when he
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started Colgate were not manufacturing
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toothbrushes but it occurred to them
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that a natural brand extension would be
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to start to manufacture and sell their
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own toothbrushes they'd built up such a
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connection with their customers as the
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leading brand and toothpaste that the
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trust was already there that if Colgate
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created a toothbrush then their
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customers would more than likely buy
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that toothbrush too and when we did
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start that it was a phenomenally huge
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success for the brand and their equity
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phenomenally increased and since the
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introduction of toothbrushes we now all
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know that they know
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I've extended their brand into other
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areas of oral hygiene like dental floss
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and mouthwashes in a 2017 report in a
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Shawn that Colgate has the third largest
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slice of a twenty eight billion dollar
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market in the oral hygiene industry
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that's some slice of pie but this
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doesn't mean that even global brands
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like Colgate can't drop the ball when it
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comes to brand extensions some brands
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can get a little bit overconfident and
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over stretch themselves or over reach
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into industry sectors that really do not
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suit the brand the best way to use a
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brand extension is to leverage as we
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said earlier your brand name but also
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the trust that you have in an industry
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sector you can extend your brand into
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other products or services which are
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closely related to that first main
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sector and customers will no doubt buy
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from you but here's where Colgate drops
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the ball they try to make a brand
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extension into an area that people just
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were not ready for and in fact it's
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become one of the world's largest brand
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extension fails so what was it
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what did Colgate try and do that was so
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bad well in 1982 Colgate thought it
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would be a great idea that they should
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enter the frozen food market yep Colgate
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making frozen ready meals right now I'm
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gonna show you an example of one of
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those ready meals and here it is the
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Colgate beef lasagna mmm minty lasagna
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at least that's what I have in my head
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when I see that cold
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lougle splashed across a box with a beef
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lasagna and I think for most people that
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would be the case too because we're
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elite Colgate so strongly to oral
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hygiene and toothpaste and mouthwash
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that your first instinct is to think
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minty fresh
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nobody wants minty fresh beef lasagna
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they just don't i'm unsurprisingly
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Colgate's foray into the ready meals
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industry failed and it failed hard so
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you can see there are two extremes here
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with Colgate the brand extensions which
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made sense to the consumer and link back
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to their mastery of toothpaste
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production toothbrushes mouthwash dental
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floss which is natural is a natural
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brand extension to move into those
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different sectors but with food it
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wasn't natural and it was a shock to the
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system and it didn't it just didn't work
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so when brand extensions go well they
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can go really well but when they go bad
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they can be disastrous
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now Colgate were in a decent position
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they were a huge global brand and so
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they could absorb that extension fail
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into the frozen foods market for other
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brands if they overextend and go into a
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product or service area that people just
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are not expecting and they don't want it
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then it can be disastrous for the main
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brand it can bring the whole thing
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crashing down so all I would say is that
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if you're thinking about doing a brand
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extension with your brand do your market
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research properly make sure that it's
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something that would actually sell that
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wouldn't confuse the consumer that they
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can see why you're doing it why there's
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a connection there is obviously a lot
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more deeper research and strategy what
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to do around a brand extension we can't
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get that into this short video but if
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you do need some help and want some
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guidance if you're thinking about it
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then you can have a chat with me jump to
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my website pixels ENCOM and you can lick
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one of my power hours and we can have a
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chat and see what you're thinking about
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and where we can take that and whether
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we think it will work for you hopefully
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it will and it will increase your brand
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equity just like Colgate on their
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toothbrushes if you like this video make
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sure to share it if you're watching on
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channel and hit that little bell icon to
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make sure that you are notified whenever
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I release a new video I also have my
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sign up to this at Roku Bronk or at UK
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who are getting free brand and design
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reviews all to help you improve your
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brand until I see you next time stay
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creative folks
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