What is the strategy of brand leveraging?

 

Brand leveraging is a marketing strategy that uses the power of an existing brand name to support the launch of a new product or service. This can be a very effective way to introduce a new product to market, as it can help to build awareness and trust among consumers.

There are two main types of brand leveraging:

·        Horizontal leveraging: This involves using an existing brand name to launch a new product in the same product category. For example, Coca-Cola could launch a new line of flavored sparkling waters under the Coca-Cola brand name.

·        Vertical leveraging: This involves using an existing brand name to launch a new product in a related product category. For example, Nike could launch a line of athletic apparel under the Nike brand name.

There are a number of benefits to using brand leveraging, including:

·        Increased brand awareness: When a new product is launched under an existing brand name, consumers are more likely to be aware of it and to consider trying it. This is because they are already familiar with the brand and have a positive association with it.

·        Increased trust: Consumers who are familiar with and trust an existing brand are more likely to trust the new product that is launched under that brand name. This is because they believe that the company that makes the brand is likely to produce a high-quality product.

·        Reduced marketing costs: Brand leveraging can help to reduce the marketing costs associated with launching a new product. This is because the existing brand name can be used to promote the new product, which can save on the cost of advertising and other marketing activities.

However, there are also some potential drawbacks to using brand leveraging, including:

·        Risk of brand dilution: If the new product is not of high quality, it can damage the reputation of the existing brand. This is known as brand dilution.

·        Risk of cannibalization: If the new product is too similar to existing products in the brand portfolio, it can cannibalize sales of those products.

Overall, brand leveraging can be a very effective marketing strategy when used correctly. However, it is important to weigh the potential benefits and risks before using this strategy.

Here are some examples of brand leveraging:

·        Coca-Cola: Coca-Cola has used brand leveraging to launch a number of new products, including Diet Coke, Sprite, and Fanta. These products have all been successful because they are related to the Coca-Cola brand and they meet the needs of consumers.

·        Nike: Nike has used brand leveraging to launch a number of new products, including Nike Air Jordan shoes, Nike Pro clothing, and Nike+ fitness tracking devices. These products have all been successful because they are related to the Nike brand and they meet the needs of consumers.

·        Apple: Apple has used brand leveraging to launch a number of new products, including the iPhone, the iPad, and the Apple Watch. These products have all been successful because they are related to the Apple brand and they meet the needs of consumers.

However, there are also some risks associated with brand leveraging:

 

·        Dilution of brand equity: If the new products or markets that are launched under a well-known brand name are not closely related to the existing brand, the brand equity of the original brand can be diluted. This means that the brand name will become less valuable over time.

·        Negative brand association: If the new products or markets that are launched under a well-known brand name are not successful, the brand name can become associated with negative things. This can damage the reputation of the brand and make it more difficult to launch new products or enter new markets in the future.

Overall, brand leveraging can be a very effective way to grow a business. However, it is important to do it carefully to avoid diluting the brand equity of the original brand or associating the brand with negative things.

What are examples of brand leveraging?

However, there are also some risks associated with brand leveraging:

·        Dilution of brand equity: If the new products or markets that are launched under a well-known brand name are not closely related to the existing brand, the brand equity of the original brand can be diluted. This means that the brand name will become less valuable over time.

·        Negative brand association: If the new products or markets that are launched under a well-known brand name are not successful, the brand name can become associated with negative things. This can damage the reputation of the brand and make it more difficult to launch new products or enter new markets in the future.

Overall, brand leveraging can be a very effective way to grow a business. However, it is important to do it carefully to avoid diluting the brand equity of the original brand or associating the brand with negative things.