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Brand extension refers to using an established brand name to introduce new products or services. This strategy is often employed by companies looking to leverage the equity and recognition of a well-known brand to gain traction in new markets quickly.


The concept of brand extension can be traced back to the late 19th century when companies began to see the value in leveraging established brand names to reach new customers. Today, brand extension is a common practice in consumer goods, fast food, and fashion industries, where companies use a well-known brand to launch new products or enter new markets.


One of the key benefits of brand extension is that it allows companies to take advantage of existing brand awareness and customer loyalty. By using an established brand name, companies can reduce the cost and time required to build a new brand from scratch and can instead focus on promoting the new product or service. Additionally, customers are more likely to try a new product from a familiar brand they already trust, reducing the risk of failure.


However, the brand extension also carries some risks. If the new product or service does not live up to customer expectations, it can damage the reputation of the parent brand and harm customer loyalty. Additionally, if the new product is not a good fit with the existing brand, it can confuse customers and dilute the brand's overall value.


"Brand extension is a powerful tool for companies looking to leverage the equity of a well-known brand to reach new customers." - David Aaker, 1991.