Organizational Growth Strategy Brand Extension - Free Samples

Question: Discuss about the Organizational Growth Strategy for Brand Extension. Answer: Introduction: When a company's existing brand has received a significant level of value and equity with regards to owning a place in the minds of the consumers, enterprises often try to leverage the success by further extending the brand. Ideally, brand extensions can be done in two ways- line extension and category extension (Som Pape, 2015, p. 18). In line extension, a new product of the same class as the original brand is introduced, while in category extension, the company launches a new product of a different class from the parent brand. This assignment discusses the factors that may influence brand extension as a growth strategy management. First, the need to minimize costs of introducing a new brand to the market is one of the factors that may influence the decision to use the brand extension as a growth strategy. The prevailing idea is that it is usually less expensive to launch a new product under a well-established brand than to introduce it as an entirely new brand (Som Pape, 2015, p. 20). This is because the new brand would require a lot of brand promotion and marketing. Another factor is the need to increase the market coverage of the brand. This is especially in line extension, whereby the product introduced falls in the same category as the parent brand (Ogbuji et al., 2014). For example, a company dealing in laundry detergents may create several varieties of soaps and differentiate them, using colors and scents. In doing this, the clients can choose from a wide range of products. Finally, the need to revitalize an old product and diversify revenue streams may necessitate the brand extension. Honestly, a new product introduced in the market with a good taste under the same manufacturer's name may influence the consumers to use old products that were no longer preferred (Ogbuji et al., 2014). A company may also conduct category extension to diversify its revenue streams, especially when it needs to tap new market segments for its product. References Ogbuji, C. N., Ezema Kalu Maduenyoghasi Oluchukwu Samson, 2014. The Influence of Brand Extension Strategy on Marketing Performance of Soft Drinks Firms in Nigeria. American International Journal of Contemporary Research, 4(1), pp. 267-275. Som, A. Pape, N., 2015. Brand and line extensions: an empirical study from the new age luxury industry. Luxury Research J, 1(1), pp. 18-39.