Stretching Brand Extensions: Research tips for new category brand development

Creating product line extensions outside the parent brand's core category can create innovative, successful new products and leverage brand equity--if based on consumer perceptions and needs, not just brand growth aspirations.

Would consumers buy toothpaste from a brand best known as a baking product? How about using a deodorant or kitty litter based on the very same product? Now that's quite a stretch! Of course, the answer is yes--if it's Arm & Hammer, a brand that has stretched beyond the kitchen to span categories as diverse as cooking, cleaning, and personal care.

What is the secret of this mega-brand's success? Arm & Hammer has extended its brand by linking its core equities of efficacy and deodorizing to novel uses: the brand naturally evolved to meet consumers' needs. Arm & Hammer evolved based on logical associations built over time and experience rather than pushing new products on consumers. As word of mouth spreads, consumers became aware of these novel uses and accepted the brand extensions.

Too often, the need for the brand to grow only for growth's sake leads to ill-conceived line extensions that consumers find illogical or inconsequential. In too many cases, these line extensions forced on consumers are at best failures; at worst, they are damaging to the parent brand's equity. However, marketers do not have the luxury of 150 years to allow this change to occur naturally in consumers' minds.

Fortunately, today's marketers have access to modern qualitative market research methods, such as Ipsos-Novaction's Category Perceptor, to accelerate the process. With an understanding of consumers' perceptions about markets at a fundamental level, brands can be positioned more accurately, competitive strengths assessed, and new niches in the market uncovered.

Where to Start?

The process begins with foundational research into consumers' needs. This research typically encompasses habits and practices studies and focus groups. Data from this research can stimulate dozens of new product ideas. These new product ideas, along with existing product descriptions, brands, and equity statements, form the raw materials for study. Consumers' associations of these ideas allow their perceptions of category structure to emerge.

The research can be performed within an individual category, such as antiperspirants and deodorants, or scaled up in a hierarchical fashion to encompass multiple categories. But it's not necessary to stop there. Category Perceptor can encompass multiple "super" categories; for example, in addition to personal care, consumers can evaluate the laundry and air care categories. The limit is essentially the ambition of the brand; that is, how far does the brand need to extend--or can it extend--to grow.

The key difference between typical market structure and brand extension strategy research is that brand extension strategy research allows consumers' latent stretch perceptions to be revealed. After associating brands with product ideas that are the primary use of the brand, consumers are then asked to perform one additional assignment of the brands based on their secondary uses: this key step forms the basis for a given brand's alternative uses associations. For example, consumers would have naturally associated Arm & Hammer very closely with cooking products, as the brand matured and new uses were discovered, these alternative uses would have been applied as secondary associations.

Finally, custom diagnostic questions can be added to the research to assess opportunity, such as how often consumers perform the task the new product idea is meant to address. This provides an indication of the frequency potential for the new product. Further, consumers' satisfaction with the current solutions to these same tasks can be assessed to gauge interest. Taken together, these two simple additional questions can be combined into a powerful opportunity index to gauge the sales potential of the new product ideas.

Steps to Brand Extension

To develop relevant brand extensions, researchers analyze consumers' associations of product ideas--both primary and secondary brand assignments--and equities using multi-variate techniques. These research tools provide both a visual representation of consumers' perceptions, as well as taxonomy of the market. Spatial distances within the maps allow for examination of the relationship between the brands with both the new product ideas and equities.

From these relationships, stepping-stone line extensions and supporting equities become apparent. These can be used to identify consumer-driven brand extension opportunities and discover "white spaces" or new product niches. Beyond answering where to extend the brand, specialized forecasting research can identify how to extend the brand by identifying those equities that allow a brand stretch its extension potential.