A successful brand extension allows companies to reach wider markets and offer new products under the umbrella of an existing and established name. However, you must be very clear on what you’re extending, why and to whom. And don’t be tempted by expediency. The cost of failure is high.

Why Fanta and not Coca Cola Orange?

It certainly worked for Coca-Cola, going back to the early Diet Cola brand extension. Why then is there not a Coca-Cola ‘Orange’ instead of Fanta? For starters, it would have broken the dark, black colour and taste memory structure. Secondly, the brand values of mother brand Coca-Cola and Fanta purposefully differ. Third, Fanta reached a market looking for something that Coca-Cola, in its purest form, did not offer. It follows that a brand extension strategy has multiple facets to it.

Fanta is the second oldest brand in the Coca-Cola stable – we suspect that if styled as Coca-Cola Orange it would have been their first failure.

Over years, Apple extended their brand brilliantly. It’s less about the brand image halo than attracting Apple customers to what Mac stands for – design and usability – through innovation transfer and an integrated business model. Again, there was more to their brand extension than the simple expedience of cost and effort.

What were they thinking?

An interesting conversation would be how Colgate extended into their ill-fated readymade food line some years back. Eat lasagne and then brush away that stubborn mincemeat morsel. I don’t know what they were thinking. But credit where its due – they could have gone the whole hog and launched a toothpaste range with lasagne extracts. They’ve moved on and are one of the world’s greatest brands. In a nutshell.

Brand extensions fail when:

• Expediency rules – the cost savings of running off the mother brand outweighs brand logic and principles.
• The new product is unrelated to the original.
• There is the chance of the extension being seen as a misfit.
• You don’t have the brand architecture of the original brand let alone for the new entrant. You don’t have a platform to work from.
• The memory structure is broken – people cannot relate.

Times have changed but the fundamentals of successful brand extension strategies have been around for decades, extending iconic brands such as Coca-Cola, Apple and apart from a brief aberration, Colgate.

Gary Hendrickse
CEO Sherpa Brand Strategy and Design
gary@sherpa.co.za
+27 83 677 7342
sherpa.co.za

Sherpa Brand, Design and Marketing is Cape Town-based but services clients throughout South Africa, mostly in Gauteng, and further afield in Australia. Crafting sales pitches and the accompanying profile documents has become a standout feature of Sherpa, including helping private equity and specialised corporate finance companies to raise investment or capital for their clients.