Brand extensions – the dilemma of existing products

Often you see a great brand trying to come up with an extension and fail and some great brands extending their brand successfully. Maggi is a good example for successful brand extensions and Harley Davidson is a great example of brand extension failures. Let us see the hows and whys:

Maggi is a brand which has high brand equity and enjoys a great number of loyalists. It is a great product and is an established player in the market. Maggi trying to expand the market and its market share has launched different variants and has entered into categories like soups and sauces. This has been a great success with high brand equity for the brand ‘Maggi’ and is the in-home product in every Indian’s house. Maggi rightly understood the core values of the brand and came up with supportive and rational brand extensions that go in line with the customers perception of the brand.

Harley Davidson, one of the greatest motorcycle brands of the century also enjoys high brand equity and loyalists. Harley Davidson users just love the brand. The company decided to capitalize on this high brand equity and started to sell branded merchandise – Harley Davidson T-shirts, socks, cigarette lighters, aftershaves, and perfumes. Clearly the Harley Davidson loyalists are not happy with these introductions. This diluted the brand too early in the case of Harley Davidson because it enjoys a much focussed group of extreme loyalists to the brand. These people don’t like the brand to be freely available to every Tom, Dick and Harry.

The lesson learnt is the rules are always not the same to everybody. One should really understand the customers and their perception of the brand. Marketers should understand the core values of the brand and then come up with strategies around the core values. Just because your brand is great at tough shoes doesn’t mean it can be extended into leather with that perception of toughness and masculinity.