Brand Extension

Dictionary Says

Definition of 'Brand Extension'


A common method of launching a new product by using an existing brand name on a new product in a different category. A company using brand extension hopes to leverage its existing customer base and brand loyalty to increase its profits with a new product offering.

For brand extension to be successful, there usually must be some logical association between the original product and the new one. A weak or nonexistent association can result in brand dilution. Also, if a brand extension is unsuccessful, it can harm the parent brand.

Investopedia Says

Investopedia explains 'Brand Extension'


The following are all examples of brand extension:

Starbucks coffee company creating Starbucks ice cream, to be sold not at Starbucks retail stores but in grocery stores. The ice cream flavors were based on the flavors of frappucinos Starbucks sold in its coffee shops.

Quaker, a popular oatmeal producer, creating Quaker granola bars, also made with oatmeal.

Celebrity homemaker Martha Stewart creating the Martha Stewart Home Collection of products such as bathroom accessories and bedding.

comments powered by Disqus
Hot Definitions
  1. Chicago Mercantile Exchange - CME

    The world's second-largest exchange for futures and options on futures and the largest in the U.S. Trading involves mostly futures on interest rates, currency, equities, stock indices and agricultural products.
  2. Private Equity

    Equity capital that is not quoted on a public exchange. Private equity consists of investors and funds that make investments directly into private companies or conduct buyouts of public companies that result in a delisting of public equity.
  3. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  4. Valuation

    The process of determining the current worth of an asset or company. There are many techniques that can be used to determine value, some are subjective and others are objective.
  5. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
  6. Tech Street

    A term used in the financial markets and the press to refer to the technology sector. Companies like Intel, Microsoft, Apple and Dell are all considered to be part of Tech Street.
Trading Center