Morning! 

Today, I want to discuss the (many) risks, and (few) upsides, of accidentally repositioning your parent brand when releasing an extension.

We've previously covered the possibility of negatively affecting what your brand stands for in people's minds when releasing a budget beer.

And while — spoiler alert — most of the points we’ll explore today are negative, there are a few use cases where an extension can positively reposition your parent brand as well.

To be clear, this risk is present anytime you're extending your brand, whether through a simple Line Extension, Brand Extension, or with some sort of Sub / Endorsed Brand. 

Our goal is to make sure that any shift that happens is not accidental and works to your advantage. 

Let’s get into it. 

What does it mean to reposition your parent brand? 

One of our through lines in The Beyond Beer Handbook was that your brewery can (and probably should) launch new extensions and brands, but not at the expense of your parent brand. 

There’s more that goes into this definition, but for today’s conversation, let’s just say that your positioning is where you sit in people’s minds, relative to your competition.

Read more on positioning here.

You want to set any new release up for as much success as possible while still protecting what your parent brand stands for in people’s minds. 

Repositioning your parent brand is simply that: It is to change what you fundamentally mean to someone by introducing a new thing for them to associate with your parent brand.

A new product, a new category, a new value prop, a new brand voice, a new identity, and so on.

If you don’t carefully weigh what a new extension says about your brewery, your parent brand can lose focus, meaning and value overtime. 

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It’s easy to understand why inadvertently repositioning your parent brand is harmful, but let’s explore these ideas to drive this home.

A misaligned extension can confuse, and alienate, your customers 

If a new product runs counter to what you’ve traditionally stood for, consumers may struggle to connect the new offering with the parent brand they are familiar with.

This can lead to a disconnect in messaging and communication, causing consumers to question the authenticity and relevance of the extension.

Customers who have been loyal to your parent brand may feel alienated if they perceive that the repositioning is a departure from the values and qualities they associate with your brand.

They might feel that the brand no longer resonates with their preferences, which could prompt them to seek alternatives.

Losing loyal customers can be detrimental to the overall success (to put it mildly) of both the parent brand and the extension.

(Above): Is Bud Light a beer brand, or a hard soda / seltzer / lemonade / tiki cocktail / cider brand? 

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A misaligned extension can wipe out precious Brand Equity / dilute what you stand for 

Your parent brand will establish a specific identity and reputation in consumers’ minds over time. Repositioning the parent brand to accommodate a brand extension can dilute the equity that you’ve worked hard to build, potentially confusing customers about what the brand truly stands for. 

This can erode the trust and loyalty that existing customers have developed, leading to decreased sales and tarnished brand perception.
 

A misaligned extension can cannibalize sales 

Repositioning a parent brand to align with a brand extension might inadvertently lead to market overlap and cannibalization. If an extension targets a similar segment or is too similar to an existing offering, you may urge people (consumers and retailers) to buy the new product in place of your parent brand.

(Above): Bud Light next competes directly with Bud Light. Not to mention Bud Light Seltzer and Michelob Ultra as well as any other low cal / carb Bev Alc offering in AB InBev's portfolio.

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We’ve spent a good deal of time talking about how you can negatively impact your positioning with a new extension. Now let’s look at how an extension can positively reposition your parent brand.

Consider the halo effect & how this can benefit your parent brand 

One way an extension can reposition your parent brand is by coming out of the gate red hot and appealing to a much broader demographic than you've traditionally reached.  

We see this a lot amongst Legacy Breweries. 

Cody and I were presenting at a conference recently and someone asked us why New Belgium has kept its name on all Voodoo Ranger products, given how big the brand has become. 

It's a great example here, so let's dig into it. 

Take a look at Voodoo Ranger packaging below and you’ll see a small New Belgium endorsement. 

As the audience member was suggesting, I don't see this Endorsement helping Voodoo Ranger (i.e. people buying Voodoo Ranger because they see that it's a New Belgium product). 

I'd go as far as to say that, functionally, this Endorsement brings nothing to the table at this point in terms of nudging people to give the beer a try. Instead, this serves to invite Voodoo Ranger drinkers to look into other New Belgium products.

So it's capturing all the good will and velocity Voodoo Ranger has earned and positively affects the New Belgium parent brand.

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This is a good case study for Legacy Breweries. 

If done right (the right style, positioning and marketing), an Endorsed extension can make an older brand seem relevant and cool again and shift what your parent brand stands for in people's minds. 

(Above): Note the subtle New Belgium endorsement on all Voodoo Ranger products.

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On mitigating risk: Wrapping up with some Brand Architecture options

There’s always a risk of repositioning your parent brand, or harming your overall reputation in some way when releasing an extension.

But if you’re weighing whether it makes sense to launch a new product as an Endorsed Brand or create an entirely new brand in terms of what this can do, negatively, to your parent brand, then building a new brand will generally win. If only because it eschews this subject entirely. 

Creating a new brand, by design, puts more of a buffer between your parent brand and new product. 

But if there's a possibility of reshaping what your parent brand stands for in people’s minds, while also giving this new product a boost due to a seal of approval from your parent, then an Endorsed Brand can be just the ticket.