Brand Extensions that work

Hi Tracey can you give us a few examples of existing brand extensions you think have been done well?

Tracey Nelson:

Polo, of course, was one of the first brands to enter the extension game on a large scale and still sets standards. While a licensing executive at Polo, I grew the business substantially, but always following the strategies and rationales set by Ralph Lauren. He knew his brand and he knew his customer. Every Polo/Ralph Lauren licensed product was required to deliver on the same brand promise he established when the Polo business launched. If I wanted to make the business case for a new extension, I had to first convince Mr. Lauren that the new venture would maintain and enhance his brand’s equity.

Apple is another great example of an admirable strategy. Apple has taken its brand promise of “cool innovation” and exponentially expanded its definition, equity and revenue through brand extensions.

A recent extension I find really impressive is Disney’s new English language schools for children in China. Not only are they enhancing their positioning as an educational tool, Disney is introducing a whole new- and sizeable - market to their characters through numerous references in both the school and the lessons themselves.

And, in another sector, Proctor & Gamble’s Iams brand, which promises to nourish pets and protect them from disease, recently licensed the brand into pet insurance, solidifying the brand’s protection positioning and creating an entirely new product category in the process.

Our Brand Extensions Strategist

Tracey is a recognized leader in the fields of brand management and brand extension. She has over twenty years’ experience in senior strategic brand management and consulting positions for world-class multinational companies, including Polo/Ralph Lauren, FILA Sports and Turner Networks. Her work spans multiple channels, product categories, industries and countries and her cross-industry experience gives her a unique perspective and expertise on the potential of brands to mine new revenue opportunities while enhancing brand equity.

Consistently designing and delivering on growth-oriented strategic and business plans for large enterprises, Tracey has also crafted numerous strategic alliances between brands and companies. She has a track record of building consensus around common goals, across multiple departments, divisions and companies, as well as a P&L management track record and perspective.

Tracey received her MBA, with a concentration in international marketing, from the Thunderbird School of Global Management. She is on the faculty of the University of Texas’s McCombs Graduate School of Management. Tracey speaks on multiple brand topics to industry groups and serves as an expert witness in trademark litigation.

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When is Extension the Wrong Strategy?

Tracey Nelson:

I want to say again – as I’ve said so many times before - that if quick and/or short-term revenue is the objective, extension is the wrong strategy. Brand equity is among the most valuable assets owned by a company and extending the brand is a long-term strategy to build that brand equity and enhance the positioning and footprint of the brand, with long-term bottom line revenue a strong benefit of a well-planned and executed extension strategy. But there are risks.

The extensions will not be perceived by consumers as coming from a licensed company or partner, but from the source of the brand itself. Extensions’ successes – as well as their failures, quality issues, delivery problems, etc. – will be tied to the brand. The extensions will BE the brand and need to be planned with the same strategic considerations as the base business.

Clearly, if the brand is still new, does not have a clear identity, does not have a defined profile of its brand lover or has little awareness, brand extension is probably the wrong strategy at that moment. Research may reveal areas in which to fortify the brand, with the goal of extending it at a later date.

In a previous conversation, I mentioned the licensing agents knocking on the door of any reasonably hot brand. While several excellent agencies exist, brand teams should be aware that many represent both sides of a potential extension, contracting with product companies to obtain licensed brand names as well as brands seeking products. The brand’s priorities need to be the driving force behind any extension strategy, and partners chosen accordingly.

Our Brand Extensions Strategist

Tracey is a recognized leader in the fields of brand management and brand extension. She has over twenty years’ experience in senior strategic brand management and consulting positions for world-class multinational companies, including Polo/Ralph Lauren, FILA Sports and Turner Networks. Her work spans multiple channels, product categories, industries and countries and her cross-industry experience gives her a unique perspective and expertise on the potential of brands to mine new revenue opportunities while enhancing brand equity.

Consistently designing and delivering on growth-oriented strategic and business plans for large enterprises, Tracey has also crafted numerous strategic alliances between brands and companies. She has a track record of building consensus around common goals, across multiple departments, divisions and companies, as well as a P&L management track record and perspective.

Tracey received her MBA, with a concentration in international marketing, from the Thunderbird School of Global Management. She is on the faculty of the University of Texas’s McCombs Graduate School of Management. Tracey speaks on multiple brand topics to industry groups and serves as an expert witness in trademark litigation.

Click here for more information on extending your Brand

Are You Ready to Extend Your Brand?

BJ Bueno:

How do you know when your brand is ready for extension?

Tracey Nelson:

One of the most common mistakes in brand management occurs when a brand team jumps into extension too soon. Based on their metrics for success in one category, many corporate teams seize on extension as a low-cost means of generating licensing revenue, most of which can fall to the bottom line – a heady temptation! Also, those calls and emails start coming in from licensing agents dangling big opportunities if only you let them manage your brand extension plans! I would suggest a few questions to ask yourself before seriously considering extension:

First: Do you really understand your current customer?

Most brand executives will just nod their heads here or think about their target customer, rather than their actual customers. Knowing the answer to this first question involves in-depth research.

Who are your brand lovers and what is it about your brand that they love? It’s essential to understand this as: a) brands cannot risk their current business by alienating the brand lovers won so far and, b) the brand must continue to deliver what they love in any extension product or service. It is very important to articulate the unique transferable characteristics of the brand before embarking on an extension strategy.

Second: Is the reach of the brand wide enough to support new products?

For example, a brand may be well known in the Northeast, but does it have sufficient recognition and equity in the Southwest to support an extension with national distribution plans? If a brand is only known to automobile aficionados, are there enough of them shopping in the grocery channel to ensure a success there? Again, this evaluation requires research and clear-eyed analysis.

Third:

If the results of the research indicate some “holes”, either in brand perception or reach, is the company willing and able to invest in the marketing necessary to fill in those holes?

Fourth: In what markets and product/service categories could the brand meet channel and consumer needs?

Again, knowing what needs a brand currently fulfills is essential to answering this question, as well as extensive analysis of any new product categories considered. Not to mention a bit of inspired creativity!

Our Brand Extensions Strategist

Tracey is a recognized leader in the fields of brand management and brand extension. She has over twenty years’ experience in senior strategic brand management and consulting positions for world-class multinational companies, including Polo/Ralph Lauren, FILA Sports and Turner Networks. Her work spans multiple channels, product categories, industries and countries and her cross-industry experience gives her a unique perspective and expertise on the potential of brands to mine new revenue opportunities while enhancing brand equity.

Consistently designing and delivering on growth-oriented strategic and business plans for large enterprises, Tracey has also crafted numerous strategic alliances between brands and companies. She has a track record of building consensus around common goals, across multiple departments, divisions and companies, as well as a P&L management track record and perspective.

Tracey received her MBA, with a concentration in international marketing, from the Thunderbird School of Global Management. She is on the faculty of the University of Texas’s McCombs Graduate School of Management. Tracey speaks on multiple brand topics to industry groups and serves as an expert witness in trademark litigation.

Click here for more information on extending your Brand

Extending Beyond The Immutable Laws of Branding

Hello Branding Geniuses and Marketing Rock Stars!

Today's post will be a bit different. For the next couple of weeks, I will be sending interview questions about building powerful brands to awesome consultant Tracey Nelson and sharing her answers here. Tracey is a recognized leader in the fields of brand management and brand extension. She has over twenty years of experience in senior strategic brand management and consulting positions for world-class multinational companies, including Polo/Ralph Lauren, FILA Sports and Turner Networks.

BJ Bueno:

How would you respond to Ries & Trout’s twelfth “Immutable Law of Branding”?

Tracey Nelson:

Law 12 of Al Ries and Jack Trout’s excellent book, The 22 Immutable Laws of Branding states that “…There's an irresistible pressure to extend the equity of the brand and it's a mistake. Instead one should create new brands to address new markets/products.” A superb rule, as it probably protects consumers from many ill-conceived product extensions!

However, there are multiple examples of successfully extended brands which support the addition of an amendment to that law: “…it’s a mistake if undertaken primarily for quick profit, rather than to extend the long-term equity of the brand and without objective research and strategic planning…”

Clearly, Ralph Lauren’s multi-billion dollar empire would not exist had we restricted the Polo brand to just ties. Nor would the Disney brand be the global force it is today had Walt stuck with one animated mouse. These two men were visionaries, but any brand team can certainly learn from them. They understood the relationship that their brand, at its core, had with its customer. Then they made sure that, as the brand extended into multiple product categories, it continued to deliver on its promise.

A simple concept, but one that requires research, objective evaluation and careful strategic planning.

BJ Bueno:

Thank you Tracey. More questions coming your way soon!

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