Marketing QA : Product line extension and Brand Extension

Marketing Practice reader Onam Jindal asks this important question about the difference between product line extension and brand extension.

For most of the marketing students, these terms are confusing. The different definitions in the text books makes it more confusing.

Interestingly the definitions of PLE and BE are different in two editions ( 11 & 12 ) of Kotler's Marketing Management text book.

In the eleventh edition of Kotler's Marketing Management,

Product line is defined as a group of products with in a product class that are closely related because they perform similar function, are sold to the same customer groups, are marketed through the same channels, or fall within given price ranges.

Line extensions consist of introducing additional items in the same product category under the same brand name , such as new flavors, forms, color, added ingredients, package sizes etc. For example Lux soap comes in different variants like Lux Crystal Shine, Lux International etc. So when Lux comes with a new variant, it is a line extension.

Brand extension happens when a company uses its existing brand name to launch products in other categories. For example, Woodlands which is a shoe brand extends itself to readymades and accessories.

This definition has certain ambiguities because the term category can be interpreted in different ways. For example , when Lux brand is extended to Shampoos , is it a product line extension or brand extension ?
The answer is : if we take personal care as a category, then the extension is a product line extension since soap and shampoos belong to the same category. But if we take soap and shampoos as different categories, then the extension is a brand extension.


In the twelfth edition , this ambiguity is put to rest. The latest edition of Kotler & Keller 's marketing management text book defines Brand extension as follows :

When a firm uses an established brand to introduce a new product, it is called brand extension.
Brand extensions can be classified into two : Line extensions and category extensions.

Line extensions happen when the brand launches the new product in the same category targeting a new segment through new flavors, added ingredients, package sizes etc.
Category extensions happen when the parent brand is used to enter a different product category.

So according the new definition, Brand Extension becomes the umbrella concept which can be used whenever a brand uses its name to any new product. The gurus has introduced a new term category extension to replace Brand Extension in the earlier definition

So now Lux coming with a new flavor is broadly a Brand Extension and more specifically a line extension.
Woodlands extending to apparels is broadly a brand extension and more specifically a category extension.

Meera : Healthy Hair for Years

Brand : Meera
Company : Cavinkare
Agency : Bates 141

Brand Analysis count : 336

Meera is a classic example of ethnic marketing in Indian context. Ethnic is defined as that which is pertaining to or characteristic of a people ( group) sharing a common and distinctive culture. Ethnic marketing is understanding those distinctiveness and adapting product and marketing strategies inorder to appeal to that group.

Meera is famous for its herbal hair wash powder. The tradition of using powder hair wash lies in our culture and tradition. Traditionally Indian women relied on powdered herbs to nourish their hair.

Then along with changing lifestyles, new products like shampoos began to take the place of these herbal powders. While hair oils have retained their position in the hair care market, the use of hair-wash powder was reduced to a niche.

It is in this context that Meera as a brand becomes interesting. The brand not only catered to the niche but also has developed this market and evolved to become an umbrella brand for more traditional hair-care products.

Although there was many companies who were selling powder hair wash, most of these players belong to the unorganized sector . Shaw Wallace had a similar product but the firm was not promoting that line. Cavinkare began to aggressively built the brand and Meera became the market leader in that category.
Herbal hair wash product typically consists of powder/essence from Shikakai , green gram, tulsi, veliver, reetha , hibiscus ,feenugreek etc.

When time passes by, these traditional products tend to lose relevance . Traditional products fade from the market for many reasons like
a. Better new products : New and better products make some traditional products less relevant.
b. No marketing : Because of lack of marketing, many traditional products fade from the consumer's mental space.
c. Product availability.
d. Changing consumer preferences
e. Non-viability of manufacturing and marketing traditional products.

In the case of herbal powder market, the products are unattractive to urban market because these are not easy products. Herbal powders are often messy and the user has to spent lot of time in using the product. In this fast life, the urban consumers are looking for fast solutions.

In my observation, consumers with grave hair problems tend to go back to these herbal products because of they feel worthwhile to invest time in using these products.

Meera as a brand has made the choice easy for the consumers. Instead of using unbranded products, consumers trusted Meera since it came from a well known company. The brand also is available in sachets thus making it convenient for the consumer to buy the product in smaller quantities. Meera uses the slogan " Healthy hair for years " highlighting the efficacy of the product.

Buoyed by the success of the hair-wash product, Cavinkare extended Meera into shampoos and soaps.
In 2004, the brand extended itself to the highly lucrative hair-oil market. Indian hair-oil market is worth around 1800 crore.

Inorder to differentiate Meera herbal oil , the company relied on a smart packaging design. The oil bottle had a visibly suspended porous cylinder containing the herbal ingredients and the consumer can see the oil deriving the nourishing from these herbs on a continuous basis. The brand virtually put into practice the dictum - " The differentiation should be observable ".

Meera is a popular brand in South India. Infact in another classic case of localising the marketing /product strategy, the brand launched Meera Chemparathi Thali in Kerala. Chemparathi is the regional name for Hibiscus. Hibiscus powder is used by Keralite as a traditional hair-care solution. Meera cashed in on this and launched the variant.

Meera is a brand which keep the hope of traditional products alive. The acceptance of this brand by consumers also gives a proof about the efficacy of traditional solutions.

With regard to the brand, Meera has extended itself to many product categories where the brand lacked competence. For example in the shampoo segment, Meera does not have a clear differentiation . In the case of soap also Meera does not have a USP. The brand was successful in offering some differentiation in oil but there the competition is huge.

Its a tough choice for a marketer to resist the temptation of leveraging a successful niche brand to mass market categories. But on hindsight, it is always wise to keep niche brand a niche brand.

Big Fun : Rest- in - Peace

Brand : Big Fun
Company : Gum India Ltd


Brand Analysis Count : 335

Big Fun was one of the hottest selling chewing gums during the Eighties. The brand evokes lot of nostalgia in me and reminds me of the countless fights that I had with my parents to buy this brand.

Big Fun was launched in 1985. At that time the bubblegum market was at the nascent stage. It was this brand which initially created the bubblegum market in India.
Big Fun was also one of the first brands in confectioneries to focus on sales promotion as the core promotional strategy . The brand initially started by offering the pictures of Disney characters to induce the kids . The brand was also harping on the BIG bubbles that can be made with it.

But the real tipping point came with the 1987 Cricket world cup. Big Fun ran a highly successful campaign focusing on cricket. The brand offered a series of collectible pictures of cricketing stars along with the bubblegum wrapper.
Along with the pictures, there was also runs/wickets which the kids would collect and keep score. At the end of the sales promotion, the kids can exchange the scores with some gifts like comics and goodies.

The scheme was a super-hit. More than the goodies, kids started collecting these pictures for the love of cricket. Favorite star's pictures was traded and kids began to buy the product for the pictures rather than the bubblegum.
Those were the days of Kapil, Viv Richards, Holding, Gavaskar, Vengsarkar, Shastri .

Bubblegum during those times was not as sophisticated as today's. Big Fun was hard rectangular shaped with a syrupy taste. One has to do a lot of chewing to make it mellow and also to make the first bubble.


Picture courtesy : Kadalamittai.blogspot.com




I also happen to see the old ad of Big Fun from the blog of Soumya Dip : Cutting The Chai.

The brand was cashing in on the cricket fever during those times. But in the early nineties the brand died . I am clueless on the reasons behind the death of such a highly popular brand. There is a possibility that the company ran into financial trouble and together with the decline of the popularity of the entire bubblegum category may have caused the death of Big Fun. The product also was not tasty enough to sustain the brand once the sales promotions' effect is gone.

I was now wondering why companies were not running such promotions during IPL. If a brand has done similar promotion during this era , will it create the same magic that Big Fun has created 20 years back ?

Big Fun is yet another brand that has faded from the memory of consumers. Another sad story of a home grown brand biting the dust.

Brand Update : Onida

Onida has ventured into mobile phones. The brand has launched the phones in the price range of Rs 1500-8000. The brand hopes to cash in on the equity of the brand in the white goods segment.

Onida was facing the issue of rivalry between the brothers over the control of the business. At one point of time, there were reports of the brothers putting the brand on the block .Now it is said that they have reached a consensus and the focus is again on the business.

It is in this scenario, that the brand has extended to mobile phones.The power of Onida brand was visible during the recent spat between the brothers. Despite the management issues, the brand was able to hold on to double digits market share in the CTV segment. During the last year, the brand was virtually silent in terms of promotions and had messed up the positioning by constantly changing the slogans.

Onida mobiles also carry the same positioning of the parent brands . The slogan used in the print ad is " Call Your Other Side ". The brand calls itself " Wickedly tempting" which will bring the spunkier side in you.

I feel that the brand has jumped into this category too early. The brand although enjoys a good equity has not been nurtured in the past couple of years. So without nurturing the core brand, any extension is going to have a negative impact . On the other side, the extension can also bring freshness to the core brand . Onida may be hoping that the extension can rejuvenate the brand.

But the issue is that mobile phone market is a highly competitive market with Nokia ruling the game. Almost all consumer durable majors have their line of mobile phones and almost all celebrities are booked by different brands. The latest being Samsung endorsed by Aamir Khan.
Hence to get eyeballs in this category requires hell lot of investment. And I bet Onida may have to compromise on other categories if they want to seriously enter the mobile segment. The brand may be hoping that the noise made in this segment will also have an effect in other categories also.

Second is the huge investment needed in product development. The models in this segment has a shorter product lifecycle and Indian consumers are now learning the habit of changing mobiles every year. Again more money to be spent on R&D and less money on brand building .

Brand Update : Motorola

Motorola has launched the lastest addition into the MotoRockr music edition phones. The latest launch MotorockrE8 comes with a morphing keypad which transforms into music mode and call mode depending on the usage situation.

The brand as usual features Abhishek Bachchan and is one of the cool ads I have seen in the recent past.

Watch the tvc here : Motorockr

Motorola it seems is all out to capture the music phone space in the Indian market. Motoyuva is also pitching on music as the main attribute for positioning.

What I liked about the ad was the perfect match between the brand and the celebrity. And to see Abhishek dancing to the Tamil number " Apidi podu " gives a special feeling especially to the South Indian consumers.

Book Review : The Last Lecture

Book : The Last Lecture
Author : Dr Randy Pausch with Jeoffrey Zaslow
Publisher : Hachette India
Price : Rs 295


Book Review #6

I happened to come across the name Randy Paush accidentally . I happened to read the Time magazine featuring an inspirational lecture of a Carnegie Mellon University professor who was detected with a terminal cancer.

That hooked me and a Google search on Randy Pausch landed me on the lecture and the book.

The story of Randy was somewhat like a Bollywood movie. A high flying computer science professor at a very young age detected with cancer and then becoming a celebrity with one speech.

Carnegie Mellon University has a lecture series where it ask eminent academicians to make a lecture assuming that it will be their last lecture. The series was aptly named as Last Lecture.
When Dr Randy was approached by the university, he was already diagnosed with pancreatic cancer . So it was destined to be his last lecture.

Like the true American spirit , Randy talked about hope rather than death . The lecture which was uploaded in Youtube spread like a wildfire inspiring millions.
The lecture lasts around 1 hour 45 minutes and time will run fast once you get hooked on the message

Watch the video here : Last Lecture

Randy titled the lecture as " Really Achieving your childhood dreams " talked about achieving what you always wanted.
The phenomenal acceptance of the lecture across the world prompted the publishers to persuade Randy to write a book. The book was written by Jeoffry Zaslow and Randy. Everyday the professor will ride the bike in his neighbourhood and he spoke to Zaslow through his cellphone headset. Thus after 53 bike rides , the book was born.

Ofcourse the book became a best seller owing to the basic life funda that the professor was talking about.

This book was one of the few books I finished reading at a stretch. I felt a change in my self after reading through.
The book is divided into two parts . The first part details the actual lecture he delivered at the Carnegie Mellon. The chapters gives you more insights and background about how he achieved his childhood dreams. The second part gives the Professor's view about ' how to live ' .

What struck me in this book is the following phrase " Time is all you have and you may find that one day that you have less time than you think".

Yes we all know that! . We know that one day we will die so what ? We Indians have a typical way of dismissing the very notion of death.

But there is a big difference between information and realization. When you read this book , if you are lucky ,this truth will be revealed to you.

Another lesson that struck me was about obstacles. Dr Randy likens obstacles to a brickwall. Brickwalls are there for a reason. They give us a chance to show how badly we want something. Only those who want it so badly can scale that brickwall.

He also talks about the basics of better living like
Aiming high
Showing gratitude
Being childlike
Never giving up etc

Although these lessons have been much talked about in different books, I felt that these lessons carry more authenticity coming from a man who knew that his days are numbered.

Last Lecture is a book I recommend because ,more than inspiring, it will bring you back into reality and the present.

Dr Randy Pausch gave the Last Lecture on September 18 , 2007. Although at that time doctors gave him 3-6 months of life, the professor is still alive fighting the disease.