MKT624 Assignment No 2 Spring 2012 solution

Company Shining star is dealing in the laundry detergents and is running a successful business over past 10 years. As the detergent was competing with just 2 other brands present at that time in the market so the Shining star detergent was having high reputation in the market and was considered the market leader. The CEO of the business was satisfied with the sales performances of the single product in the category of laundry detergent and never thought of line extension even. But competition crept in within the past 3 years, as most customers started preferring to use branded laundry detergent instead of non-branded loose detergent. Many companies entered the laundry business to meet the increasing demand. As a result of competition, Shining star started losing its market share due to the upcoming brand of detergent introduced in the market as a result of category extension by a well-liked FMCGs company. Company Shining star has decided to go for extending the brand in order to beat the raising competition.
Question:
Discuss which extension options Shining star has? Having been equipped with brand extension concept suggest which extension option the company should select and give details why you recommend that particular extension option?

Solution:

This is a great question, and one that plagues many businesses as they struggle to maintain or grow market share without diluting what their brand stands for laundry.
I will first need to know what Shining Star means in the minds of customers and prospects today. What words, thoughts, or attributes do they think of when they hear the name Shining Star or see it on a shelf?

If the answer is aligned with your planned line extension, I could probably get away with it. If, however, shining star planning on diverging from your current marketplace positioning, I would not recommend using the same brand name to “stretch” over more and meaning.

It might give you the impression that your brand’s current recognition will propel the launch of a new, extended product. But it could bite you back in the long term as your original brand loses more and more equity. I will explain more on this topic with the help of logical views.

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