The marketers of a successful brand often will want to consider extending their brand into other market segments or even other product categories to maximize profit. Very good to do this if you can do it well. Because the costs and risks in building a brand from scratch can sink it.
But we often see cases where an extension of a brand into a new area produced failure or even damaged the original brand’s place in consumer’s minds. As a result of its failure or by confusing customers about what the brand is supposed to stand for (its brand essence) with two possibly conflicting messages, making business building more difficult.
Good question to ask yourself when considering adding products to capitalize on your success is: will the brand extension continue to reinforce in my customers’ minds what my original brand stands for?
So the brand extension must carry much of the parent brand’s essence into a new area, taking something from the parent. But also, with success, building the reputation of the parent by allowing people to experience its meaning in a somewhat new way. Maybe even in a different product category.
A brand that usually is used as an example of having achieved a definite brand essence is the Volvo vehicle brand. In cars, Volvo has been very closely associated with the idea of safety. After having sold very safe but frankly, unfortunate looking, cars for decades. Nobody bought a Volvo for its looks. Just safety, but which to some is extremely,extremely important.
Then business pressures led the firm to explore expanding its product range away from boring family sedans. But attempts to sell sportier, more powerful cars were not met with much success.
Maybe because safety is very nearly the opposite of quick, snappy driving. Slower is safer, as many warning signs suggest. Too hard to accept that the ugly girl was going to become Cinderella.
Maybe because combining more power with a heavy, still really safe car frame, was not going to produce enough excitement after all. So not a persuasive argument for Volvo. For sure, those cars were never going to approach BMW or even Audi in thrills. If you wanted some driving excitement, you had many, much more exciting alternatives. Many priced much lower. So a sporty Volvo was not going to cut it.
But all was not lost. SUVs area segment where power and safety are a good combination. Many SUV buyers were buying SUVs because they believed they were safer than sedans. SUVs sit higher than sedans and look more protective in the event of collisions, is more vehicle around you protecting you and you’re higher than that car coming right at you. Arguably SUVs already competed directly against Volvo for the “safe” market.
Volvo might have chosen to keep selling sedans and station wagons/estate cars against SUVs. Instead Volvo went right into that segment with crossover SUVs (the fruit of an SUV father and a sedan mother) offering its safety heritage, feeding from the market segment that wanted SUVs for their safety. And offering Volvo’s long track record of delivering practically bullet proof vehicles as a differentiator versus other SUVs, which might have been positioned against the macho, but not safety conscious, market.
Until then, the mothers who wanted safety had to buy SUVs designed without safety as a deliberate end result. Now they have exactly what they were looking for in Volvo’s crossovers.Today some of Volvo’s best selling models are their crossovers. An SUV with the safety of Volvo clearly is an appealing idea.
Going back to the point for today, the Volvo cross overs benefited from the safety heritage from their sedans but are also continuing to build Volvo’ reputation for safety, now in a different segment.