A SEMINAR REPORT

ON

“BRAND EXTENSION”

IN PARTIAL FULLFILLMENT FOR

“SEMINAR ON CONTEMPORARY MANAGEMENT ISSUES”

(PAPER NO. 207)

IN

M.B.A. PROGRAMME

OF

1

contents

1. Introduction Of Brand Extension1.1 What is the Means of brand Extension?

1.2 Types of Brand Extension

1.3 Benefit of Brand Extension

1.4 Risk of Brand Extension

1.5 Characteristics of successful Brand Extension

1.6 Brand Extension Failure

1.7 Principle of Brand Extension

1.8 Brand Extension Research Case history- Carnation

1.9 Brand Extension Research Case History-Dole

2. Research Methodology

2.1 Tile of Subject

2.2 Objective of Study

2.3 Type of Research Design

2.4 Instrument use in study

2.5 Method of data collection

2.6 Simple size

2.7 Conclusion

2.8 Questionnaire

Bibliography

2

Acknowledgement

This report is to acknowledge my indebtedness to my guide. Faculty of

‘Subodh Institute Of Management & Career Studies’ Ram Bagh Circle,

Jaipur’ Jaipur for his guidance and suggestions for completing this

report. Her great presence always encourages me to hardworking and

completes this task timely. I really thankful to their Hartley support in

every step of this Report.

3

1. IntroductionRecognizing that one of their most valuable assets is their Brands, Many firms have decided to leverage that asset by introducing a host of new products under some of their strongest brand names. Most new products are in fact line extension – typically 80 to 90%in any year.

Moreover, many of the most successful new products, as rated by various sources, are Extension (e.g. Microsoft Xbox video game system, apple iPod digital Music player, and Nokia 6800 cell phone). Nevertheless, many new products are introduced each year as new brand (e.g., Zyprexa mod stabilizer drug, TiVo digital recorder, and mini automobile).

“When a firm uses an establishment brand name to introduce a new product “

Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. Organizations use this strategy to increase and leverage brand equity (definition: the net worth and long-term sustainability just from the renowned name). An example of a brand extension is Jello-gelatin creating Jello pudding pops. It increases awareness of the brand name and increases profitability from offerings in more than one product category.

A brand's "extendibility" depends on how strong consumer's associations are to the brand's values and goals. Ralph Lauren's Polo brand successfully extended from clothing to home furnishings such as bedding and towels. Both clothing and bedding are made of linen and fulfill a similar consumer function of comfort and hominess. Arm & Hammer leveraged its brand equity from basic baking soda into the oral care and laundry care categories. By emphasizing its key attributes, the cleaning and deodorizing properties of its core product, Arm & Hammer was able to leverage those attributes into new categories with success. Another example is Virgin Group, which was initially a record label that has extended its brand successfully many times; from transportation (aero planes, trains) to games stores and video stores such a Virgin Megastores.

In 1990s, 81% of new products used brand extension to introduce new brands and to create sales. Launching a new product is not only time consuming but also needs a big budget to create awareness and to promote a product's benefits. Brand extension is one of the new product development strategies which can reduce financial risk by using the parent brand name to enhance consumers' perception due to the core brand equity.

While there can be significant benefits in brand extension strategies, there can also be significant risks, resulting in a diluted or severely damaged brand image. Poor choices for brand extension May dilute and deteriorate the core brand and damage the brand equity. Most of the literature focuses on the consumer evaluation and positive impact on parent brand. In practical cases, the failures of brand extension are at higher rate than the successes. Some studies show that negative impact may dilute brand image and equity In spite of the positive impact of brand extension,

4

negative association and wrong communication strategy do harm to the parent brand even brand family

Product extensions are versions of the same parent product that serve a segment of the target market and increase the variety of an offering. An example of a product extension is Coke vs. Diet Coke in same product category of soft drinks. This tactic is undertaken due to the brand loyalty and brand awareness they enjoy consumers are more likely to buy a new product that has a tried and trusted brand name on it. This means the market is catered for as they are receiving a product from a brand they trust and Coca Cola is catered for as they can increase their product portfolio and they have a larger hold over the market in which they are performing in.

1.1 Understanding Brand Extension

“Brand extension is using the leverage of a well known brand name in one category to launch a new product in a different category.”

The philosophy of brand extension is not well understood and as a result, brand extension is often implemented incorrectly. Note the components of this definition of brand extension:

It is a new product.

It should use a well known brand.

The brand should have leverage with customers of the new category.

Well known brand: One client wanted us to help extend Crosse and Blackwell (a sauce brand). Research showed people did not recognize the brand or incorrectly thought they made electric drills! (Black & Decker)!

Leverage with customers of the new category: Remember that by definition, a brand extension is a product in a different category from the parent brand. Our study of Snickers revealed that ice cream bars do not necessarily sell to the same people who buy Snickers candy bars. What is important therefore is what ice cream bar customers know of and think of Snickers. In practical terms, leverage means that customers in this new target category would perceive the new brand extension to be superior to existing competitive products on an important dimension. This is extendable equity.

Leverage is not the same thing as consumer acceptability: Marketers often spend too much effort on extending brands into categories just because consumers allow it. If our Dole research had revealed that consumers thought Dole vegetables was a reasonable sounding brand extension, does that mean it is a good one? Not necessarily. If there is no competitive advantage of Dole vegetables versus existing brands of vegetables, it will likely fail. Entering a new category is always a

5

risky undertaking. There is a steep learning curve in production, distribution, promotion, etc. But most of all, we are competing for consumers’ business where they have loyalties to established brands. Why should anyone switch to something new and untested? That is what a new brand extension (like any other new product) must provide: a strong reason why the consumer in the new category will prefer us to what they are buying now.

Note the connection and leverage of this brand extension:

1.2Types of Brand Extensions

In studying more than 300 brand extensions, Brand Extension Research determined that there are eight

6

types. Each has its own unique type of leverage.

1. Similar product in a different form from the original parent product. This is where a company changes the form of the product from the original parent product.

An example is (frozen) Snickers Ice Cream Bars identified in our brand extension study. The original Snickers bar is a shelf stable candy. The brand extension is a similar product, but in a different form. Jell-O Portable Pudding and Pudding Cups is Jell-O pudding in a different form and section of the store.

2. Distinctive flavor/ingredient/component in the new item. When a brand “owns” a flavor, ingredient or component, there may be other categories where consumers want that property.

Peanut butter is a characteristic ingredient in Reese’s Peanut Butter Cups candy. Chocolate is a characteristic ingredient of Hershey. Brand Extension Research identified Reese’s Peanut Butter as a logical extension that capitalizes on this association. Research also suggested Hershey chocolate milk.

3. Benefit/attribute/feature owned. Many brands “own” a benefit, attribute or feature that can be extended.

Brand Extension Research showed Armor All that that brand was defined by automotive surface protection – which can go beyond vinyl dressing. Paint needs protecting also. Arm & Hammer “owns” a benefit of deodorizing. Their baking soda product has claimed that it removes odors from refrigerators, etc. As a result, they extended the brand into other products such as Arm & Hammer underarm deodorant and cat litter deodorizer.

4. Expertise. Over time, certain brands may gain a reputation for having an expertise in a given area. Leverage can be achieved when extending into areas where this special expertise is deemed important.

7

Honda’s expertise in reliable engines led to lawn mowers, gas powered generators and a variety of other gasoline engine powered devices. What brand comes to mind when we think of baby products? – Gerber. As a result of this acceptance of their expertise, they successfully launched Gerber Baby Powder, Gerber Baby Bottles, etc. Sara Lee is known for baked desserts, so why not other baked goods like bread.

5. Companion products. Some brand extensions are a “natural” companion to the products the company already makes.

Contadina was a tomato paste and sauce brand. In brand extension research, consumers thought Contadina pasta was a logical companion product that would have the leverage of the Italian heritage of the parent. Aunt Jemima (the pancake mix brand) launched pancake syrup, as a companion to compete with Log Cabin syrup.

6. Vertical extensions. Some brand extensions are vertical extensions of what they currently offer. A brand can use their “ingredient/component” heritage to launch products in a more (or sometimes less) finished form.

Nestlé’s Toll House chocolate refrigerated cookies is an example. Most Toll House chocolate chips are used in cookies, so why not make a brand of Toll House chocolate chip cookies. Mrs. Fields Cookies were ready-to-eat. They offered frozen cookie dough, moving backwards as a vertical extension. Rice Krispies has always been used in kids' treats. Kellogg offered Rice Krispies Treats ready-to-eat.

7. Same customer base. Many brand extensions represent a marketer’s effort to sell something else to its customer base.

8

This works particularly well when that customer base is large and to some extent captive. VISA launched travelers checks directed to its credit card customers.

8. Designer image/status. Certain brands convey status and hence create an image for the user.

Designer clothing labels have been extended to furniture, jewelry, perfume, cosmetics and a host of other items. Some brands promote a lifestyle and can extend to items that people “wear,” as a badge of identifying themselves with that lifestyle.

Tommy Bahamas extended their brand from clothing into furniture.A notable success is Harley Davidson. Their extensive collection of licensedlifestyle items goes way beyond any expertise inherent in the brand.

General Strategies for Establishing a Category Tauber’s Franchise—Extension

Introduce the same product in a different form. Example: Ocean Spray Cranberry Juice Cocktail

Introduce products that contain the brand’s distinctive taste, ingredient, or component. Example: Philadelphia cream cheese salad dressing

Introduce companion products for the brand. Example: Coleman camping equipment

Introduce products relevant to the customer franchise of the brand. Example: Gerber insurance

Introduce products that capitalize on the firm’s perceived expertise. Example: Honda

9

lawn mowers

Introduce products that reflect the brand’s distinctive benefit, attribute, or feature. Example: Lysol’s “deodorizing” household cleaning products

Introduce products that capitalize on the distinctive image or prestige of the brand. Example: Calvin Klein clothes

1.3Benefits of Brand Extensions

There are significant benefits to a successful brand extension:

• Identify logical new product possibilities• Capitalize on the paid-for equity in established brand names• Enable a company to enter new categories at significantly lower cost • Reduce the risk of failure given the already established awareness and trust• Create a positive synergistic effect with the efficiencies of umbrella branding and advertising• Reinforce the consumers’ perceptions of the parent brand name• Bring news to existing brands when there is otherwise nothing new to say about them

“Brands are the barrier to entry into new categories; they are also the means to entry.” Brands (not production capabilities) are the prime barrier to entry into most categories. Many companies could make a cola, but only Coca-Cola owns that brand. As a result, well known existing brand names can be the way for a company to enter a new category that otherwise would be impossible. Our brand extension study for Reese’s identified peanut butter as a logical brand extension. Hershey could not have efficiently entered the peanut butter category without the Reese’s brand. In effect, brand extensions allow a company to capitalize on the “previously paid for” recognition, reputation and leverageable equity of its brand names. With the prohibitive cost of establishing new brands (just ask ex dot-coms), brand extensions save companies money. When done correctly, they also reinforce the properties of the existing parent product through synergy and bring news to the brand. It is not uncommon to find sales of the parent product rising after the launch of a successful brand extension.

10

Note how the Olay brand entered the soap business:

1.4 Risks of Brand Extensions

Much has been written as scare tactics about the negatives and risks of brand extension. In reality, if a brand extension is so off target or lacks fit and or leverage, it likely will fail and do little damage. Most of these misfires die in limited test market anyway. There can be real damage to the parent brand, however, when too many unrelated brand extensions are launched. Names like Betty Crocker, General Electric and Kraft have been extended profusely. While they have not lost their awareness as household words, the strong associations they once had to specific products and related qualities (e.g. cake mix, light bulbs and cheese) may be diluted. This is especially dangerous when a brand is used synonymously with a specific product. Brands that are not legally generic but are used that way such as Kleenex, Scotch (Tape), and Band-Aid should not be extended broadly or they risk losing this valuable quality.

Can a brand be all things to all people? Some like Virgin and Mitsubishi have tried. Those few that have succeeded with broad based extensions have a benefit thread running through their products that customers of the respective categories want. Virgin offered value in differentiated services like their airline. Their cola, jeans, vodka, etc. flopped. Contrast this with Healthy Choice or Atkins which offered a common thread in all of their products of low fat or low carb. It all comes back to understanding a brand’s extendible equity and staying focused by knowing “What business we are in.”

11

Eonfuse or frustrate consumers

Encounter retailer resistance

Fail and hurt parent brand image

Succeed but cannibalize sales of parent brand

Succeed but diminish identification with any one category

Succeed but hurt the image of the parent brand

Dilute brand meaning

cause the company to forgo the chance to develop a new brand

1.5 Characteristics of Successful Brand Extensions

Successful Brand Extensions have “Fit” and “Leverage.”

Fit: What categories consumers will accept from a brand? A brand’s stretch-ability or boundaries.

Leverage: Distinctive properties a brand “owns” that provide a competitive

12

advantage to the brand extension in its new category.

Many manufacturers do not understand what makes a brand extension succeed. In some cases, brands are extended just to save money that would be needed to establish a new brand. In other instances, companies want to stretch a brand to as many categories as possible in hopes of just adding sales. The starting point of searching for successful brand extensions is research that profiles the consumers’ view of the boundaries and leverage of the brand.

The boundaries issue is what we call “Fit.” Research attempts to see what categories consumers will accept for the brand (its stretch-ability). For example, in our research, consumers accepted the concept of Duracell flashlights but when asked about Duracell cameras, said no. Duracell didn’t have that expertise in their mind. Whether they did or not didn’t matter. Perceptions dictated that Duracell cameras would be at a competitive disadvantage; the brand did not fit well there. If a brand extension is a non sequitur, it will likely perform poorly or fail.

Leverage is the impact of the distinctive properties that a brand “owns” that lead customers in the new category to perceive the brand extension as superior to existing competitive products on an important dimension.

Dissecting this definition:

Parent brands considered for extension must own some distinctive properties (though not necessarily exclusive ones). Some brands “own” an ingredient - Toll House (chocolate chips), some own a benefit or attribute – Bounty (absorbency), and others own an expertise – Honda (experts in reliable engines). Brands that “own” nothing usually are not good candidates for brand extension. Being well known is not enough.

Some reasonable segment of consumers in the new category must want this property. The critical factor in a brand's extension success is whether the distinctive property owned by the brand is important in the new category and provides a competitive edge. If absorbency is important in peoples’ selection of napkins, then Bounty napkins might be a success. If absorbency is not important for polishing cloths, then a Bounty version will have no edge in that category. Another example: Honda has a unique expertise in reliable motorized products. A Honda lawn mower with a claim of superior engine technology and reliability offers distinctive benefits that flow from the essence of the brand’s

13

reputation. The key here is the importance to lawn mower buyers of the attributes of engine performance and reliability. Honda lawn mowers, not surprisingly is a successful product. Note the issue is not just fit. Many mistakes are made in launching brand extensions because the consumer will “allow it.” Without leverage, a brand extension is a weak idea.

Studies conducted by Brand Extension Research have revealed that there is often an inverse relationship between fit and leverage. Brands that consumers will allow to be on a wide range of products have little leverage (own nothing special). Consumers may think, for example, the Betty Crocker brand would be fine on many food product categories. But if that brand brings little strength other than recognition and a general good feeling, it may have little leverage. In contrast, Philadelphia brand stands for cream cheese. This limits its extendibility but it means that any brand extension where cream cheese is an important ingredient (e.g., cheesecake) will find the Philadelphia brand to be a strong competitor.

Successful brand extensions are not that easy to identify, develop and position. Just sticking a known name on a new product does not guarantee its success. If it were that easy, companies with national brands would not have so much difficulty in launching big new product successes. One trap companies sometimes fall into is what we call the “great reputation” trap. Clients have told us that what their brand “owns” is a great reputation. Customers tell them that they offer a quality product, the best in its category, one of their favorites, etc. Unfortunately, hundreds of brands have a great reputation. What is relevant is whether customers in the new target category find some reason to prefer the new brand extension to current offerings. Having a great reputation for quality is not enough.

Note the supermarket version of Salsa from Taco Bell:

1.5 Brand extension failure

14

Literature related to negative effect of brand extension is limited and the findings are revealed as incongruent. The early works of Aaker and Keller (1990) find no significant evidence that brand name can be diluted by unsuccessful brand extensions. Conversely, Loken and Roedder-John (1993) indicate that dilution effect do occur when the extension across inconsistency of product category and brand beliefs. The failure of extension may come from difficulty of connecting with parent brand, a lack of similarity and familiarity and inconsistent IMC messages.

“Equity of an integrated oriented brand can be diluted significantly from both functional and non-functional attributes-base variables”, which means dilution does occur across the brand extension to the parent brand These failures of extension make consumers create a negative or new association relate to parent brand even brand family or to disturb and confuse the original brand identity and meaning.]

In addition, Martinez and de Chernatony (2004) classify the brand image in two types: the general brand image and the product brand image. They suggest that if the brand name is strong enough as Nike or Sony, the negative impact has no specific damage on general brand image and “the dilution effect is greater on product brand image than on general brand image”. In consequence, consumer may maintain their belief about the attributes and feelings from parent brand. On the other hand, their study shows that “brand extension dilutes the brand image, changing the beliefs and association in consumers’ mind”.

The flagship product is a money-spinner to a firm. Marketer spends budget and time to create maximum exposure and awareness for the product. Theoretically speaking, flagship product is usually had the top sales and highest awareness in its product category. In spite of Aaker and Keller’s (1990) research reported that the prestige brand do no harm from failure of extension. Evidence shows that the dilution effect has great and instant damage to the flagship product and brand family. But in some findings, even overall parent belief is diluted; the flagship product would not be harmed. In addition, brand extension is also “diminish consumer’s feelings and beliefs about brand name. To establish a strong brand, it is necessary to build up a “brand ladder”.

Marketers may go behind the order and model created by Aakerand Keller which they are authorities on brand management. But branding is not following a rational line. One mistake can damage all brand equity. In practical issue, a classic extension failure example, such as huge company like Coke Cola launching the “New Coke” in 1985, has conflict the consumer’s perception. Although the early acceptance pervades in the beverage market, the backlash of “New Coke” sooner emerges among consumer. Then the extension strategy creates a negative impact to parent brand. Not only did not success in developing new brand but also decrease the original flavor’s sales. The Coke Cola pay a lot effort to regain the customer back who turns to Pepsi cola. This is a classic example of negative effect on extension failure.

Although there are few works about the failure of extensions, literature still provides sufficient in depth research around this issue. Studies also suggest that brand extension is a risky strategy to increase sales or brand equity. It should consider the damage of parent brand no matter what types of extension are used. Example. BIC Pens tried to produce BIC pantyhose. You can read some more here .

15

1.6 Principles of Brand Extensions

Brand Extension Research has identified 10 principles that characterize a GOOD brand extension. These rules should guide any work in order to increase the probability of success.

1. Brands should not be extended unless they are well-known, have high awareness and a good reputation among the new target market.

2. Brand extensions must be a logical fit with consumers’ expectations.

3. Brand extensions must have leverage in the new category – a transfer to the new product of a distinctive property associated with the parent brand that gives the brand extension an edge in the new category. The test: “Just knowing the brand name, customers of the new category should be able to identify a reason why they might prefer the new brand extension to existing competition.”

4. Brand extensions that could create confusion or a negative image for the parent should not be undertaken.

5. Brands that consumers use synonymously with a category (generic) should not be extended to other categories.

6. Brands should not be stretched to too many diverse categories risking dilution in the long run. (There are cases, however, where a brand dominates a modest sized category and has no room to grow. In these instances, the upside potential of extending is worth the risk of dilution – e.g., Arm & Hammer.)

7. Brand extensions that will not create positive synergy for the parent brand should not be pursued. (Ask consumers whether their opinion of the parent would be lowered if the new brand extension were available.)

8. Brand extensions must make business sense.

9. Every brand extension should open a category for the firm. The whole point of brand extension is to efficiently and successfully enter a new category.

10. A critical part of every brand extension research study is developing a brand plan. Short and long term possibilities should be identified up-front.

Here we might discuss in more detail the last three points. Many brand extensions are simply bad business ideas. Just because consumers would accept chocolate pudding from Nestlé doesn’t mean this is a good business idea. The category may be dominated by another company. Nestlé may not be able to efficiently manufacture the product. The margins in the new category may be too small to justify the

16

investment, etc. In point 9, we suggest that every brand extension should open a new category for the company and in point 10 that long term possibilities should be contemplated in advance. When Ocean Spray launched Ocean Spray Cranberry Juice Cocktail, that product opened the door for the company to enter the bottled juice business in a big way. A myriad of other flavors followed creating a sizable business. Launching a brand extension that is an orphan in the category can be a prescription for failure because the item cannot generate sufficient sales to be adequately supported and defended.

Developing a long term plan using brand extension as a means to enter a category is what brand extension should be all about.

Brand Extension: What Business Are We In?

The process of exploring brand extensions represents a reasoned approach for selecting new categories a company might enter with their brands. Inherent in this process is the identification and decision of answering the question “What business are we in”?

The heart of brand extension research is the effort to identify what business the brand is in from the perspective of the consumer. The objective of every brand

17

extension research study is to uncover and articulate this definition of the business of the brand hidden in the mind of the consumer!

What business are they in?

Caterpillar Coleman Jim Beam

In 1960, Harvard professor Theodore Levitt highlighted this basic strategic question in his classic paper Marketing Myopia. He challenged management to think broadly about what was or could be their realm of domain pointing out the failure of the railroads to recognize they were in the transportation business. The result was missed opportunities.

Sometimes there are alternative definitions that are possible and management has to choose. Originally offering pens, Bic chose to define its brand as disposables rather than office supplies and extended accordingly. When management doesn’t make an implicit choice and brand extensions are launched without regard for a clear definition, damaging dilution may occur. Note the extensive licensing activity of Sunkist extending to candy, soft drinks, vitamins, pistachios, etc.

If we ask consumers to tell us what business xyz brand is in, they draw a blank or just state the category. Consumers might say: Clorox is in the bleach business. Hershey is in the candy business. Duracell is in the battery business. Carnation is in the milk business. Dole is in the pineapple business. And so on….

However, when we research these brands we find a range of properties that are associated with them - ingredients, benefits, attributes, expertise, etc. (See the section on the 8 types of brand extension.) Using our proprietary methods, we can discover what the brand “owns” – its extendable equity - and write a definition of the business of that brand. This definition usually contains issues relating to what the brand cannot be as well as what it can. The true test of the accuracy of this definition is that it allows us to predict with any new category whether consumers would find the brand fits there and has

18

leverage (See examples in our case histories). In almost every brand we have studied, there has been a difference - sometimes a huge difference - between what management thought the brand’s definition and boundaries were and how the consumer defined and set boundaries! The company that makes a product has one database from which it perceives its brand. The consumer has a far different and more personalized database that he or she uses to form impressions about the brand, its extendibility and competitive advantages.

1.7 Brand Extension Research: Case History – CARNATION

Carnation is a brand that was nationally known and was thought to be a good candidate for expanding into a variety of other food and beverage areas. At the time of our study, Carnation was found on evaporated milk, powdered (dry) milk, Carnation Instant Breakfast, hot cocoa mix, fresh milk, ice cream, yogurt and various other dairy case items. However, the fresh dairy side of the business was only in the western part of the United States. When asked what business the brand was in, management gave various definitions – a dairy company, a milk company, a nutrition company, a progressive multi-product company. This internal conventional wisdom turned out to be different from the view held by the consumer. Carnation was associated with evaporated milk and to a much lesser extent powdered milk – period. As a result, consumers did not think of the company behind the brand as a dairy, a milk company or anything like that. When compared to dairy company brands, Carnation was seen very differently. “Carnation makes base foods, ingredients and mixes, not finished ready-to-eat foods. Carnation was seen as wholesome, but not a nutrition company.

Products that used milk as a primary ingredient were viewed as appropriate for Carnation. There were properties such as creamier, richer, more wholesome, etc. that translated to any Carnation brand extension. Most dairies were regional, so a national brand owning the properties of milk as an ingredient was a viable idea. One interesting concept that appeared to have fit and leverage was infant formula. A number of people thought that there already was a Carnation infant formula in the marketplace. This may have occurred because historically, some mothers used Carnation evaporated milk as an ingredient in making their own infant formula. As a result of this finding, development began on a Carnation infant formula.

The parent company of Carnation, Nestlé is the world’s largest infant formula producer. Using their formulations and technology, a number of formulas were developed for use in the American market. The existing infant formula market was dominated by two pharmaceutical companies. Their brands – Enfamil and Similac – had names that were more "drug-like" to mothers. In contrast, Carnation was a more "food-like" brand. In keeping with that differentiation, the name Good Start was chosen to launch the new line of formulas. Carnation formula based baby cereal was launched later. Over time, management wanted to re-brand the formulas

19

Nestlé to be in keeping with their worldwide formula name. In the U.S. these formulas have been very successful with sales in the hundreds of millions of dollars.

1.8 Brand Extension Research: Case History – DOLE

When Dole management hired us to study their brand, the portfolio of items under the Dole brand consisted largely of canned pineapple slices, pieces, juice, and some other commodities such as bananas, mushrooms, melons, etc. Still, the consumer equated Dole with pineapples. The objective of the company was to move beyond commodity items and pineapple specifically to launch more profitable value-added foods and beverages. The company relayed that pineapple appeals to a segment of the population, but the hope was that the brand could be extended to broader appeal non-pineapple products.

The results of the study of Dole revealed (not unexpectedly) a strong connection to pineapple. However, the associations with pineapple were fresh, clean, bright, sunny, and the imagery of a wholesome outdoor lifestyle. It was seen as the best of Hawaii – the fun, the food and sunshine in the most exotic and romantic of settings. Dole represented a “Sunshine Lifestyle,” which translated to sunshine fruits and products that would contain these. Dole was perceived to be all natural, not full of additives or preservatives.

As a result, a variety of brand extensions emerged from this work:

Dole frozen Fruit ‘N Juice BarsDole Fruit SorbetDole Fruit ‘N Cream BarsDole 100% refrigerated Pineapple Breakfast Juice (and other blends such as pineapple orange)Dole Whole Fruit Coolers

Although all of these product lines originally included a pineapple flavor, the dominant seller was often some other flavor like strawberry or orange. As predicted, the consumer welcomed non-pineapple flavors from Dole. The Fruit ‘N Juice Bars, for example, were a characteristic product containing only fruit and juice. This stayed true to the leverage point that Dole was natural, not

20

manufactured or artificial.

Using the “sunshine lifestyle” definition of the business, we cooperated with Landor Associates in conducting an international survey about the Dole brand. The sunshine imagery was confirmed and an appropriate new logo was designed by Landor. Brand extension activity has continued at Dole with the launch of various items, some that contain pineapple and some that do not.

2. RESEARCH METHODOLOGY

2.1 RESEARCH METHODOLOGY - DEFINED

21

a. Research is the systematic investigation to establish facts or collect information on a

pre-decided subject.

b. Methodology is the specification of the system of principles and techniques used in

a particular discipline.

2.2 TITLE OF THE STUDY: -

22

Define the problem and research objective

Develop the research plan

Collect the information

Analyze the information

Finding & Recommendations

“Analysis of Brand Extensions”

2.3 OBJECTIVE OF THE STUDY

1) To find out the brand Extension Advantage /Disadvantage.

2) This is better for company or not.

3) Successful &Failure Brand Extension

2.4 TYPE OF RESEARCH DESIGN

Research design involves a general plan of how to go about answering the research

questions set keeping in mind the research objective.

Quantitative research technique was used for the project. This was intentionally

done because the units in which the factors were organized were in quantitative

terms.

Exploratory research design was used for this project. The main purpose of this

research is to interact with retailers and to know the satisfaction level by the

quality of services being rendered by different telecom service providers. The

major emphasis in such studies is on discovering of ideas and insights.

2.5 RESEARCH INSTRUMENTS USED

Methods used under this kind of research design are:

23

Developing plans for the research

Drafting questionnaire

Survey

Analyzing and interpreting the results.

Here I have used method of research-based survey. Brand Extension is research

subjects. The object of the survey is to obtain the insight into the relationship

between the sales and services rendered by the companies.

Advantages

It is fast and easy to comprehend.

It can get good result even with a small sample size.

It gives the research the necessary flexibility to get a deeper understanding

of the respondents.

2.6 METHODS OF DATA COLLECTION

SECONDARY SOURCES: -

For the completion of the research it was important that the secondary data should be

supplemented by primary data originated specifically for the research in hand. The

primary data was gathered through questionnaires. My research findings are based on

information collected from filled questionnaires. The main sources of secondary data

were: -

Internet

Newspaper

PRIMARY DATA COLLECTION METHOD:-

1) Questionnaire

24

2) Interview

3) Observation

Advantages

High accuracy level.

Disadvantages

It is time consuming.

It is expensive.

Sometimes accuracy is not passed on telephonic interview, due to lack of

clarity in the questions.

Method used to collect primary data is:

Questionnaire

Questionnaire Method: For the purpose of the study survey was conducted across areas of

Jaipur. The Questionnaire (a sample copy is attached) was prepared according to the objectives

of the project and was administered accordingly. The data gathered through this exercise became

the primary data.

2.7 SAMPLE SIZE

25

Sampling is done to figure out the parameters, which decide our sampling techniques and

the sample size to be adopted. It is the process of selecting units from population of interest

so that by studying the samples one can fairly generalize the results to the population from

which the results were chosen. This would further help the whole research to reach the

final solution.

SAMPLE SIZE: 10 corporate people

SAMPLING UNIT: company

SAMPLING DESIGN: Non Probability– Quota Sampling

CONCLUSION:-

I have found in my research that Brand extension is depended on the image of the company.

Some time it may be useful for the company next time it may be not fruitful. It is depended no. of affecting the brand extension. Brand Extension is help to decrease the cost of the company. It is also help the increasing the image of the company .this factor are depend on when the company made any product also constraint the preference of the customer because whole market are depended on the customer . In this situation which company will be success? Which fellow customer test.

Questionnaire

Name Designation:

Address: City:

26

Company:

1) What is the brand Extension?

----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2) What are the Advantages of Brand Extension?

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

3) What are the Disadvantages of Brand Extension?

------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

4) How is it beneficial for a company?

-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

5) You have any idea about the successful brand extension company?

---------------------------------------------------------------------------------------------------------------------

--------------------------------------------------------------------------------------------------------------------

6) What is your suggestion about the Brand Extension?

---------------------------------------------------------------------------------------------------------------------------------------------------------

-------------------------------------------------------------------------------------------------------------------------------------

BIBLIOGRAPHY

In this project report, while finalizing and for analyzing quality problem in details the

following Books, Magazines/Journals and Web Sites have been referred. The all

27

material detailed below provides effective help and a guiding layout while designing this

text report.

Websites:

www.google.com

www.Brandextension.org

Magazines & Publications: -

1. India page of HT paper

2. Economic Times

28