Brand extension is required for a company’s growth, profitability, and brand’s added reputation. It is an inevitable strategic move at some point of time in brand management.

While extending a brand, all assumptions related to that brand held for a long time are revised and the brand’s identity is redefined. The brand managers need to identify growth opportunities and increase parent brand’s value.

What is Brand Extension?

It is nothing but launching a product in a different category under an already established brand name. It is extending the existing brand promise with diverse products or services.

The following diagram shows the matrix of brand growth.

When a company introduces a new product, it has the following choices −

●      New Brand, New Product (New Brand)

●      New Brand, Existing Product (Multi-Brand)

●      Existing Brand, New Product (Brand Extension)

●      Existing Brand, Existing Product (Line Extension)

The last two in the above list are the types of brand extensions.