What Are The Advantages and Disadvantages of Brand Stretching?

Authors Avatar

                                                                        

What Are The Advantages and Disadvantages of Brand Stretching?

In addressing the above question it is first important to establish what a brand is and the implications this gives to both existing products and products that may be laundered using existing titles. This essay will examine articles written concerning the stretching of brands and identify which brands have been successful and unsuccessful in this pursuit and why.  It will also examine the financial motives for companies to penetrate existing markets using already established new products or services has lead to prosperity or disaster.

The American Marketing Association refer to branding as the "use of a name, a term, a symbol or a design to identify the goods or services of one seller and to distinguish them from those of the competition " (WK4 Lecture).  This use of branding is said to create an identity of the product that quickly allows consumers to identify a desired item and also gives a guarantee of quality of the product.  Branding is also seen as being mutually beneficial to Manufacturers as protection is offered from competition, it allows maintenance of a premium price, promotion is made more efficient because the brand helps to evoke an image, and it also helps in the introduction of new products with the same brand name (WK4 Lectures).

King (1971 p.3/4) writes of the rise of power of manufacturers by branding their products, thus taking control of the market from the wholesalers, by allowing retailers and consumers to more easily identify products they wanted.  This process was moved further forward by manufacturers creating direct links with the buying public through the use of advertising.  King states that the basic motive for this was "to stabilise demand, thus allowing regular large-scale production, free from the whims of the wholesaler.  Partly because of this the advertising tended to be based on the idea of reliability and guaranteed quality". (1971 p.3).  It was due to such strategies (according to King) that the manufacturers dominated the market from about 1900 to 1960.

Join now!

However since the 1960's the market has turned a full cycle, returning control to the retailers (although maybe not so much to the wholesalers).  This is illustrated by Caulkin (1987) who states that "over the last two or three decades there has been a massive shift in the balance of power form manufacturing towards the retail end of the economy" (p.46).  This Caulkin states, is particularly notable in food and fast moving consumers goods.  Large supermarkets such as Tesco's, Asda and Sainsbury started to implement 'own-label' goods which over time sharply reduced the ...

This is a preview of the whole essay