Brand development strategies on current market
Based on two stimuli brand development strategies are created. They are (product category, brand name).
- Line extension.
- Brand extension.
- Multi brands.
- New brands.
Line extension: It occurs when companies extend their existing brand by introducing new colors, new flavors, ingredients, size, and form of their existing products. It is a low cost and low risk path to introduce new products. Companies do this to satisfy consumer needs for variety and they also do this to fully use their capacity. It also helps them to have more command on shelf space form resellers over competitors. It doesn’t always work out the way companies want. Sometimes over extending line companies lose their essence. They also make consumer angry by making them confused what to buy. If it happens then companies loose their customer base over competitor’s simple line. Line extensions have an effect on company’s sale, sometime it is hard to create enough target market for all segments. Lifebuoy soap has three different colors and fragrance in their product line, so if lifebuoy introduces a new fragrance or colour then it’s line extension because lifebuoy is a exiting brand and it will be just an addition To the existing product category .Companies have to work hard to establish each Line properly in the market. Companies need to make sure that when they create a line they create choices not confusion.
Brand extension: When a New product category is extended within the existing brand it is called brand extension, like square pharmaceuticals Ltd. An existing brand established square hospital it did a brand extension. Companies who have already established brand can use their current brand value to promote new products. They have to be careful about not fading their main brand image. There are times when a brand extension fails and it affects companies other products sales, so before making any decision they need to think rationally about it.
Multi bands: When in a given product category a company has many brand than it is called multiband. It helps companies to have more shelves in market. In multibranding the brands are each other substitutes. While making a multi brands portfolios companies need to monitor the market to know brand popularity, so that they know which brand to promote and to pull the plug from which brand. Since each brand focus on different segment they can capture more customers. If companies have similar brands than it become hard to keep customers because they can became confused and switch. A perfect example of multiband is unilever Bangladesh Ltd. has many bathing soaps brands like lux, dove, lifebuoy etc. Multiband are existing product category in New brand to introduce.
New brands: When a company introduces a totally new brand in a new product category than it is called new brands. When a company wants to enter a new market in a new product category they sometime create a totally new brand. When pran Ltd entered furniture and kitchen items market they adopted a new brand name RFL Ltd. For pran furniture was a new product and RFL was a new brand.
Companies use all four brand development strategies according to their situation. It depends on capital, time, and company values. No matter what strategies they choose at the end companies just want to make profitable products portfolios that make companies achieve their goals.