Laura Ries makes a compelling case for the addictive quality of creating line/brand extensions. In her view, the temptation to increase market share, by borrowing on the equity in a well established brand, is just too great for many business owners and brand managers. In many ways it parallels the way we Americans have tapped the equity in our homes, like giant ATM machines. Brands are much the same way, containing monetary worth, but only to a point!  By borrowing on the strength of an exisiting brand, it often weakens it, so these decisions have to be weighed carefully.

In some instances brand extensions can make sense.  Diet Coke is a good example. It’s close to being the same tasting product, minus the cup of sugar. So that line extension opened the market to those on a diet, without changing the basic flavor or delivery method. Where brands get goofy is when they stretch it too far. At what point is Diet Vanilla Cherry Coke no longer Coke? I advise clients that brand extensions work when they are built on the same axis, or piviot point, as the orginal product. By that I mean that the extension has to deliver the same end benefit.

Example?

For Rolex, a brand extension needs to deliver prestige. A cheaper Rolex watch would fail that test. But a luxury Rolex interior in a Mercedes might work well. So it’s not that brand extensions don’t work at all, it’s just that they need to be firmly rooted in the product’s core promise. Apple has extended its brand into the music arena by staying consistently small, cool, innovative and user friendly. Apple took the same brand attributes and applied them to their iPhone. A cheap computer would fail as a line extension for Apple, but a small, cool, innovative GPS system might work well.

So take a look at what you’ve been slapping your name on. If you have been reckless with brand extensions, I would suggest you come out of denial and practice Laura’s 12 step program. It works if you work it.