Old brand in the spotlight

Why is it that so many brand extensions fail as a concept? Many attempts in stretching a brand resulted in losses of relatively small amounts of money in case of the big brands or, worse, loss of the original brand due to enormous debt made by the failed brand extension for the smaller brands. For the small companies a failure of an extended brand is catastrophic but it isn't all bad for a bigger company. Many years have passed since the first time companies made use of brand extensions and the original goal of launching a product faster with the use of a familiar brand is somewhat outdated. Lately bigger brands with enough cash to think about extending their brand and failed to keep the consumer's attention focused on their brand launch a new product just to get the news. That is why brand extensions are more often considered as a useful marketing tool rather than a new form of production or income. And if consumers seem to like the product, the company is lucky twice.

Source: Brandchannel

Mattias Dierickx