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|280 PART 3 Designing a Customer Value-Driven Strategy and Mix
Line extension
Extending an existing brand name to new
forms, colors, sizes, ingredients, or flavors ample, over the years, KFC has extended its “finger lickin’ good” chicken lineup well be-
of an existing product category.
FIGURE | 8.6
Brand Development Strategies
traditionally named versions of its Android operating system after sweet treats (because An-
droid devices “make our lives so sweet”), with names such as Cupcake, Honeycomb, and Jelly
Bean. This time, it named the new version “after one of our favorite chocolate treats, KitKat.”
In turn, KitKat launched specially branded KitKat candy bars featuring the Android robot. The
co-branding effort added a touch or fun, familiarity, and exposure to both brands.
Co-branding can take advantage of the complementary strengths of two brands. It also
allows a company to expand its existing brand into a category it might otherwise have dif-
ficulty entering alone. For example, Nike and Apple co-branded the Nike+iPod Sport Kit,
which lets runners link their Nike shoes with their iPods to track and enhance running per-
formance in real time. “Your iPod Nano [or iPod Touch] becomes your coach. Your personal
trainer. Your favorite workout companion.” The Nike+iPod arrangement gives Apple a
presence in the sports and fitness market. At the same time, it helps Nike bring new value
to its customers.42
Co-branding can also have limitations. Such relationships usually involve complex le-
gal contracts and licenses. Co-branding partners must carefully coordinate their advertis-
ing, sales promotion, and other marketing efforts. Finally, when co-branding, each partner
must trust that the other will take good care of its brand. If something damages the reputa-
tion of one brand, it can tarnish the co-brand as well.
Brand Development Figure 8.6). It can
A company has four choices when it comes to developing brands (see
introduce line extensions, brand extensions, multibrands, or new brands.
Line Extensions. Line extensions occur when a company extends existing brand names
to new forms, colors, sizes, ingredients, or flavors of an existing product category. For ex-
yond original recipe, bone-in Kentucky fried chicken. It now offers grilled chicken, boneless
fried chicken, chicken tenders, hot wings, chicken bites, and, most recently, KFC Go Cups—
chicken and potato wedges in a handy car-cup holder that lets customers snack on the go.
A company might introduce line extensions as a low-cost, low-risk way to introduce
new products. Or it might want to meet consumer desires for variety, use excess capacity, or
simply command more shelf space from resellers. However, line extensions involve some
risks. An overextended brand name might cause consumer confusion or lose some of its
specific meaning.
For example, in its efforts to offer something for everyone—from basic burger buffs
to practical parents to health-minded fast-food seekers—McDonald’s has created a menu
bulging with options. Some customers find the crowded menu a bit overwhelming, and
offering so many choices has complicated the chain’s food assembly process and slowed
service at counters and drive-throughs. The extended menu may also be confusing the
chain’s positioning. According to one analyst, McDonald’s “doesn’t have a clear marketing
message right now.”43
At some point, additional extensions might add little value to a line. For instance, the
original Doritos Tortilla Chips have morphed into a U.S. roster of more than 20 different
types of chips and flavors, plus dozens more in foreign markets. Flavors include every-
thing from Nacho Cheese and Pizza Supreme to Blazin’ Buffalo & Ranch, Fiery Fusion,
and Salsa Verde. Or how about duck-flavored Gold Peking Duck Chips or wasabi-flavored
Mr. Dragon’s Fire Chips (Japan)? Although the line seems to be doing well with global
sales of nearly $5 billion, the original Doritos chips seem like just another flavor.44 And
Product category
Existing New This is a very handy framework
for analyzing brand development
Brand name Existing Line Brand opportunities. For example, what
extension extension strategy did Toyota use when it
introduced the Toyota Camry
Hybrid? When it introduced the
Toyota Prius? The Scion?
New Multibrands New brands