Introduction to Brand

A brand is a product with unique character, for instance in design or image. It is consistent and
well recognised. A distinct brand name is a very valuable asset to the business. A brand which
may come in different forms such as a symbol, a sign, a design, or a combination of any of the
mentioned forms, is what identifies a product from another and from its competitors and it is
created to build a relationship between the business and the consumers.
Some retailers use "own-label" brands, where they use their name of the product rather than the
manufacturers like Tesco's "Finest" range of meals and foodstuffs. These tend to be cheaper than
the normal brands, but will give the retailer more profit than selling a normal brand. Some brands
are so strong that they have become global brands. This means that the product is sold in many
countries and the contents are very similar. Examples of global brands include: Microsoft, Coca
Cola, Disney, Mercedes and Hewlett Packard. The strength of a brand can be exploited by a
business to develop new products. This is known as brand extension – a product with some of the
brand's s characteristics. Examples include Dove soap and Dove Shampoo (both contain
moisturiser); Mars Bar and Mars Ice Cream.
Difference between Brand Stretching and Brand Extension
Brand stretching is where the brand is used for a diverse range of products, not necessarily
connected. E.g. Virgin Airlines and Virgin Cola; Marks and Spencer clothes and food.
Branding is a strategy that is used by marketers. Pickton and Broderick (2001) describe branding
as Strategy to differentiate products and companies, and to build economic value for both the
consumer and the brand owner.
Brand extension: Brand extension refers to the use of a successful brand name to launch a new
or modified product in a same broad market. A successful brand helps a company enter new
product categories more easily.
For example, Fairy (owned by Unilever) was extended from a washing up liquid brand to
become a washing powder brand too. The Lucozade brand has undergone a very successful
brand extension from children’s health drink to an energy drink and sports drink.
Brand stretching: Brand stretching refers to the use of an established brand name for products
in unrelated markets.
For example the move by Yamaha (originally a Japanese manufacturer of motorbikes) into
branded hi-fi equipment, pianos and sports equipment.
Brand Extension of Cocacola Company
The Brand extension is commonly used by well-known brands that use their image to launch
new varieties of their products in order to satisfy different needs of their current consumers as
well as to gain new ones. This strategy is also implemented when a new trend is being developed
in the market and to enlarge the brand’s awareness.
In the Cola market, Coca Cola and Pepsi have both been very active in this matter. They have
taken advantage of their brand equity and launched several variations of their regular products in
terms of flavors and ingredients. The brand stretching with not only the highest impact in sales
but also the oldest attempt of widen the brand’s portfolio has been diet or light products, that still
today continues to be updated with new versions thanks to the health concerns both brands have
acquired as seen previously in the blog and trying to respond to an ever increasing demand of
consumers for healthier products.
The rivalry between Coca Cola and Pepsi is evident as well in this field, where being the first to
develop an idea is very important and usually the other brand responds to this initiatives by
launching a similar product.
Let’s take a look to the most important examples of brand extension for Coca Cola and Pepsi!
Coca Cola:
Coca Cola Light/Diet Coke: are both the same product but with different names because in some
countries the word “Diet” doesn’t mean low-calorie. It is a sugar and calorie free soft drink that
was developed in the United States in 1982, and was the first brand extension of Coca-Cola. It
was launched as a respond to the Diet Pepsi that was launched in 1964 and was acquiring great
relevance in the market. The sweetener mix used for the product changes among countries due to
different consumer preferences
Coca Cola Zero: introduced in 2005 within the low calories segment and its main target are men,
because they tend to link Diet and Light to women. It is intended to be the same taste as the Coca
Cola Classic, while Coca Cola Light/Diet Coke has a different formula. Is sweetened with a
blend of low-calorie sweeteners, while Diet Coke is sweetened with aspartame
Coca-Cola Cherry, Diet Cherry and Zero Cherry: it was launched in 1985 and was the third
variation of the brand. Then, in 1986 thanks to a successful performance Diet Cherry Coke was
introduced and in 2007 was added Coca-Cola Cherry Zero
Coca-Cola Black Cherry Vanilla and Diet: it was launched in 2006 but due to low sales it was
then discontinued in 2007
Coca Cola with Lime: released in 2005 as a respond to the consumer’s request but it hasn’t been
very successful in several countries where it was discontinued. Has been a limited edition in
many countries but in others like Singapore and Netherlands is a regular product
Caffeine-Free Coca-Cola, Diet and Zero: introduced in 1983 as a response to Pepsi Free that was
having notorious results. The diet version was the first extension of the Diet Coke
Vanilla Coke: released in 2002 to compete with Pepsi Vanilla but it didn’t have a good
performance. In 2007 it was relaunched in the US and in the UK in 2013, where it was supposed
to be a limited edition but thanks to a better sales behavior it stood as a regular product
Coca Cola Life: Launched in 2013 in Argentina as a pilot test, has 108 calories per bottle which
is less than the half of calories of a Classic Coke, using Stevia as a sugar substitute. This
innovative product claims to be green and natural as sold in a recyclable bottle that is made from
30% plant-based materials
Brand Stretching of YAMAHA
Image fit and business fit are important in unrelated extensions as well. But here the image of the
organization itself is as important. In some way successful unrelated extensions are closely
linked to the history of the development of industry in India. This is demonstrated by the growth
ofTata and Godrej brand in the past. Both Tata and Godrej have been among the first few Indian
brands to be known to the consumer. Besides, the commitment of Tatas to quality and employee
welfare (TISCO) and Godrej to product innovation (use of vega table oil instead of animal fat for
making soap) is well known. When Tata branded salt or when Godrej branded safe they were
among the first to do so. Thus unrelated diversification is more likely to be successful if the
brand possesses.

Brand stretching however is when an established brand name is used in totally unrelated markets
or product categories. A great example is when Yamaha Pianos branded to hi-fi equipment, skis
and motorcycles. And my favourite when Guinness introduced their range of new BBQ sauce in
the grocery sector!
Some companies have used brand extension and stretching together very successfully, a great
example is the Virgin group, establishing as Virgin records they then moved into Virgin music
and megastores and then stretched to totally new markets such as radio, cola, insurance, trains
and more
A brand stretching is a strategy wherein a fresh or new product is established under an existing
brand name. According to Martinez, Montaner & Pina (2009) it is a firm's way of how a new
product is introduced and make new offerings attractive for the customers and the distributors
which involves "leveraging the brand equity" established in old-fashioned markets. The transfer
of equity from the parent or established brand to the extension sidesteps the great outlays of
evolving and "communicating a fresh brand name".
Brand streching is significant to increase the economic benefit of the market and also for the
maintainability of the brand. Batra, Lenk and Wedel (2010) said that consumers are likely to try
out the products of brand extensions. Brand extension can either be a line extension or a category
extension. An example of a line extension is Pringles, it comes in different flavours - cheese,
original, ranch, sour cream; or Coke as the parent brand and Diet Coke and Cherry Coke as line
extensions. Line extension is the type of extension where the new product belongs to the same
category as the parent brand and typically this comes as a variation in size or flavour. Category
extension on the other hand is where the extension is in a different category or market from the
parent brand. For example, the Yamaha brand, originally it manufactured motorbikes then they
produced pianos, hi-fi equipment and sports equipment.
Conclusion
A brand name is what makes a product stand out from the rest. A strong brand name gives the
consumers recall and positive feedback which is good when marketers consider using the brand
extension strategy. Brand extension stretches the line or the category of the product. A good fit
and experience with the parent brand can make the brand extension a success. For the past
decades products have been sprouting up and these products are mere brand extensions of the
parent brand because consumers patronize brands they have grown to love and believe that is
why firms build on that trust and confidence from the consumers to enhance and innovate their
old products and package it into something with an added twist that will attract its loyal
consumers to support the new products the same way the parent brand has been supported.
References

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Marketing, Vol. 54(1), pp. 27-41
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Quarterly, No.2, pp. 101-109
Han Jin K., (2008), “Brand Extensions in a Competitive Context: Effects of Competitive Targets
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Review, Vol. 01
Martínez Eva; and Chernatony Leslie de. (2004), “The Effect of Brand Extension Strategies
upon Brand Image”,Journal of Consumer Marketing, Vol. 21(1), pp. 39 – 50
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