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When Doritos launched its first foray into the world of tangy, cheesy snacks in 1964, few could have predicted the incredible success the brand would achieve. It wasn’t just the original tortilla chips that propelled Doritos to stardom, however, it was their bold, innovative brand extensions. By continually introducing new flavors, textures, and product concepts, Doritos has kept its brand fresh and exciting for consumers, continually building on its own successes.
One of their most successful brand extensions is the Doritos Locos Taco, a collaboration with Taco Bell that became a blockbuster hit, selling over 100 million units in the first 10 weeks of its launch in 2012. Today, the Locos Taco is a permanent menu item on Taco Bell’s menu, and because of its wild success, other snack brands have engaged in brand extension collaborations with the fast food company (like the newly announced Cheez-It + Crunchwrap combination). Doritos’ success story exemplifies the power of creative brand extensions.
But what exactly is a brand extension, and, more importantly, how can you leverage strategic extensions to grow your brand? Let’s find out.
What Is a Brand Extension?
A brand extension is a strategic approach where companies use their established brand names to launch new products or services. This tactic leverages the existing brand's reputation, customer loyalty, and market recognition to introduce new offerings, allowing companies to diversify their product lines and enter new markets more effectively.
Rather than relying on the success of a single product or audience, brand extensions allow companies to open up new revenue streams. By offering a wider range of products to multiple audiences, they have the opportunity to build deeper loyalty with their current customers and attract new consumers who may not have bought — or even encountered — their original product.
Types of Brand Extensions
Brand extensions can be categorized into several different types, each with a unique approach and benefits.
- Line Extension: Line extensions involve introducing additional items in the same product category under the same brand name. These could be new flavors, forms, colors, ingredients, or sizes. Line extensions are the easiest and most common entry point for CPG brands.
Example: Coca-Cola introduced Diet Coke, Cherry Coke, and Coke Zero, not to mention Coca‑Cola Cherry, Coca-Cola Spiced, Coca-Cola Vanilla, Caffeine Free Diet Coke, and more. - Category Extension: Category extensions expand a brand into a new product category that is different from the original one.
Example: Dove, initially known for its beauty bars, expanded into body washes, shampoos, deodorants, and men’s grooming products. - Complementary Extension: Complementary extensions involve introducing new products that complement or enhance the use of the existing product.
Example: Colgate, known for toothpaste, expanded into toothbrushes and mouthwashes. - Vertical Extension: Vertical extensions introduce a new product at a different price or quality level within the same category. These can be divided into upscale (premium) and downscale (value) extensions.
Example: Marriott offers a range of hotels, from the budget-friendly Fairfield Inn to the upscale Ritz-Carlton. - Brand Collaborations: A brand collaboration involves two or more brands that come together to create a brand new product, service, or marketing initiative that leverages each brand's respective strengths, values, and consumer bases. This collaboration is a strategic way to extend each participating brand's reach and influence beyond its traditional boundaries, making it a subset of brand extension strategies.
Example: Adidas partnered with Kanye West (Yeezy) to launch a line of sneakers and apparel (and later scuttled the entire line due to West's antisemitic comments).
4 Keys to Successful Brand Extensions
The difference between an effective extension and one that falls flat often comes down to a few critical factors. Here are four keys to remember when considering and crafting your brand extension.
- Stay true to your core.
For a brand extension to be successful, the new product or service must align with the core values and promise of the parent brand. Consumers need to see a logical connection between the existing brand and the new offering. A strong brand fit ensures the extension feels like a natural evolution of the brand, rather than a forced addition.
Example: Nike’s extension from athletic shoes to sports apparel and equipment was a natural fit because both categories are closely related to sports and fitness. - Understand your audience.
Thorough market research is essential to understanding what consumers want and need. This involves analyzing consumer behavior, preferences, and trends to identify gaps in the market that the brand can fill. A successful brand extension effectively addresses these needs, providing value that resonates with the target audience.
Example: When Amazon expanded from being an online bookstore to offering a wide range of products and services (such as Amazon Prime, AWS, and Echo), it did so by understanding and anticipating the evolving needs of its customers. - Maintain quality and consistency.
Continuing to provide the quality and consistency that consumers expect from the original brand is crucial for the success of any brand extension. Any new product or service must meet or exceed the standards set by the existing brand to maintain consumer trust and loyalty.
Example: BMW’s extension from luxury cars to high-performance motorcycles maintained the brand’s reputation for quality, performance, and innovation, ensuring that consumers received the same level of excellence in both categories. - Don’t forget the marketing.
Effective marketing is crucial for the success of any brand extension. Don’t assume a new product will sell itself. Treat your brand extension like a new product launch. Ensure that your messaging is consistent across all platforms through integrated marketing communications, clearly highlight the unique benefits of your new product, and consider partnerships with influencers to boost credibility and reach. Engage with your audience on social media to generate buzz, and offer in-store promotions and sampling (if applicable) to drive immediate trial and adoption.
Examples of Creative Brand Extensions
From startups to established companies, brand extensions have proven to be a powerful way to boost overall growth. Let’s explore seven successful brand extension examples that made significant impacts
- RXBAR: From Bars to Nut Butters
Initially known for its minimalist protein bars made with simple, whole-food ingredients, RXBAR expanded into RXBAR AM breakfast bars and RX Nut Butter bars. By honoring their commitment to simple, real ingredients, RXBAR successfully introduced these new line extensions that aligned with their brand ethos and met consumer demand for healthy, portable snacks.
Why It Worked:
Brand Fit: Both products emphasize simple, real ingredients.
Consumer Demand: RXBAR addressed the growing market for healthy, portable snacks.
Quality: Their new products maintained the brand’s reputation for transparency and healthfulness. - Prime: From Sports Drinks to Energy Drinks
Prime, launched by influencers Logan Paul and KSI, specializes in functional beverages aimed at replenishing and energizing active individuals. After starting with hydration sports drinks, Prime quickly expanded into the energy drink category. Thanks to their massive online followings and a focus on superior taste and health benefits, Prime Energy drink and Prime Hydration lines quickly gained popularity among their core audience.
Why It Worked:
Brand Fit: Both products serve the active, health-conscious demographic.
Influencer Power: The brand leveraged the influencers’ strong brand presence and loyal fan base.
Quality and Innovation: Prime Energy offered a healthier alternative to traditional energy drinks, maintaining product integrity. - Oreo: From Cookies to Ice Cream and Beyond
Oreo has extended its brand beyond the iconic cookie into products like ice cream, candy bars, and international flavors. Each new product maintains Oreo’s identity, focusing on the indulgent and fun experience that fans love.
Why It Worked:
Brand Fit: All products emphasize fun and enjoyment.
Consumer Loyalty: Oreo’s extensions capitalized on the strong emotional connection fans have with the Oreo brand, ensuring every product maintained the core Oreo taste and experience.
Innovation: By introducing new formats and flavors, Oreo appealed to loyal customers seeking new experiences and attracted new consumers intrigued by novel offerings.
Market Success: These extensions expanded Oreo’s market presence and reinforced its position as a leader in the cookie category.
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