Manish Gunjan
Abstract
Introduction The new product launch phase is a critical part of the total new product development process. This is especially true in the consumer packaged goods arena, where nearly 26,000 new products were introduced in 1999. This compares to just over 12,000 new product introductions in 1986. With this dramatic escalation in the number of new products competing for consumer attention, the quality of launch programs greatly impacts the success of product introductions. In addition, each year it becomes more difficult to break through the noise generated by the thousands of existing products and line extensions. Sometimes, even well-conceived, innovative products meet with failure in the marketplace. Companies can end up pulling the plug on a perfectly good product because the launch strategy and execution failed to score high marks on the complex matrix of marketing factors that spell launch success. Brand Extension as a Marketing Strategy Many companies adopt brand extension as strategy with the aim of benefiting from the brand knowledge achieved in the current markets. When a company launch new product and market under the umbrella a well-known brand name, failure rates and marketing costs are reducing. Creating a brand name with well-established associations is one way of achieving this aim. Firms invest heavily in developing a brand. It is a very costly process but has many returns once success is achieved. Brand extension as a marketing strategy has become even more attractive in today’s environment where developing a new product costs a lot of money and can be time consuming.