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How many brand extensions are too many?

 

Brand strategists, Jack Trout and Al Ries, are staunchly anti-extension. And they particularly harp on line extensions (that is, adding another variant to the same brand—e.g. Voodoo Ranger Imperial IPA > Voodoo Ranger Juicy Haze)—a much lighter touch exercise than an actual brand extension (using your brewery’s brand in an entirely different category—e.g. Dogfish Head Distilling, Corona Hard Seltzer, Big Lug Cocktails).

Let’s examine their rationale before diving into CODO’s thinking. 

People tend to categorize and remember only a few brand names for any given category. There’s just too much noise, and advertising and chaff constantly coming our way to remember any more than that (name 10 shampoo brands, go!).

The goal of positioning is to occupy one of those coveted slots in people’s minds—to become the de facto brand someone thinks about when they need to buy something. 

I want a luxury watch” = Rolex. 

I want a bombproof cooler” = Yeti. 

I want to read a horror novel” = Stephen King. 

The problem with extensions, as Ries and Trout outlined, is that anything you release that doesn’t align with that core positioning (e.g. a $500 Rolex that anyone could afford) dramatically dilutes the parent brand’s positioning and reputation. 

Bud Light Seltzer’s recent campaign is a fun, if not perfect illustration of this entire thesis.

Bud Light Seltzer Commercial

Brand strategists and marketers know about these issues, yet high profile brand extensions still roll out every single day. 

Why is this?

We’ve helped dozens of breweries position, brand and launch extensions. So we can say with first hand experience that when you have a great selling brand, the pressure to extend it can be immense. Retailers, distributors, consultants, trade media, internal team members and even your fans can clamor for it.  

Add in a dash of FOMO from watching your competition grabbing headlines with their extensions and this pressure can be so intense that it may seem imprudent to not throw your concerns and intuition out the window on this matter.

Budweiser Brand Extensions
Look how they massacred my boy.

For those keeping score, Bud Light Seltzer Hard Soda would be a Brand Extension of a Brand Extension of a Line Extension. It's extensions all the way down.


Where does CODO fall on this issue?

For as much as we harp on the importance of positioning, we're not as stalwartly anti-line (or brand) extension as you might think. Yes, we're always cautious about the impact a new product can have on an overarching brand (and have, more than once, been a dissenting voice in strategy meetings).

But we also think that Trout and Ries’ line of thinking is more applicable to the zero sum world of international conglomerate brands who can genuinely vie for that first or second “slot” in consumers’ minds more so than a localized industry like craft beer (where a major driving force behind craft's growth has always been diversity and brand promiscuity itself).

This idea coupled with fragmenting consumer tastes (beer > seltzer > kombucha > RTDs > Lo&No…), generational shifts (Gen Z becoming a buying force) and the still-not-yet-entirely-realized impact that the DTC trend will have on the industry, leads us to believe that a few well conceived extensions can actually enhance a brewery’s overall brand and portfolio by offering options that their fans are already buying from someone else. 

The hang up is that the extension has to make sense. You can’t leverage your parent brand into another category just because it’s well known. And you shouldn't line extend just to make a quick buck either.

There has to be an intuitive link between your parent brand and the extension. The extension should not only build its own brand, but reinforce the parent brand's story and values and good will as well. 

Can a popular brewery make a great RTD cocktail? Sure, maybe. Can that same brewery make a great frozen lasagna meal?

Colgate Frozen Lasagna

If you’re dead set on launching a brand extension, here are a few quick guidelines to keep you from having to later cut a commercial to directly address how confusing it is that your brewery’s name is also on a hard seltzer can for some reason. 


Less is more

One or two extensions can work well if the subsequent releases reinforce the parent brand's positioning and value props (Blue Moon > Blue Moon Light Sky is a great example here because it brings a seasonal flair to the mix). More than one or two and you stand the risk of making the entire lineup too convoluted for your fans to follow, particularly if you start layering in line extensions on top of those brand extensions. (peep that Budweiser extension-mania image above for reference. "yeah, gimme a Bud Light… Lemonade Seltzer Soda, please?")


How to avoid this issue altogether 

If you’ve determined that a brand extension does not make sense, this doesn’t mean you can’t launch the product. It just means you have to explore another brand architecture strategy for bringing it to market—e.g. a subtly-endorsed brand, some sort of shadow endorsement or even a standalone brand if you have the capacity to properly manage it.  


The most important question

Does this new product naturally align with your parent brand’s values and value props? Is this something your brewery would launch? Does it make sense at a gut level? 

If there’s any doubt, then you need to be extremely careful with putting your brewery’s name on that product. Yes, you could possibly see a short term bump in sales by leveraging your parent brand’s equity of the gate, but it likely won’t last beyond the honey moon phase. And it could end up doing far more damage to your positioning in the long run.

Key Takeaways


1. Your brand and positioning need to be protected at all costs. Anything that confuses or dilutes them is detrimental to the cause. 

2. You have to think in terms of decades when building a brand. Don’t make a shortsighted decision in pursuit of a profitable quarter. Think about how an extension could help, or harm, your overall brand down the line.

 

Rewatch our Brand Architecture Presentation


Four Strategies for Extending Your Brewery's Brand Beyond Beer


 
Cody and I had a fun time talking about Brand Architecture at the Craft Beer Professionals Fall Virtual Conference. This is a sneak peek at the new book we've been working on for the last year and a half (and directly related to the issues topic). 

If you're thinking about lunching some sort of extension (seltzer, RTD, etc.), you should give this a watch to make sure you're making sound brand strategy decisions along the way. 

Latest Resources

The Beer Branding Trends Podcast is live!


 
We're 2 episodes in and have been humbled by the reception—over 1k downloads already (crazy!). If you haven't already, catch up on episodes 1 and 2 and let us know what you think.

In-House with Sierra Nevada


 
We had the privilege of sitting down with Sierra Nevada's Advertising and Creative Manager, Conor McMahon, to discuss Pale Ale, brand extensions and how a legacy brewery can stay relevant in 2021.

Australia Craft Beer Podcast 


 

We enjoyed a wide-sweeping conversation about beer branding and Australian craft beer with Matt Kirkegaard of Radio Brew News a few weeks back.

 

Sneak Peeks (works in progress)


 

Ready to learn more?


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Craft Beer, Rebranded


 
Craft Beer, Rebranded and its companion Workbook are a step-by-step guide to map out a winning strategy ahead of your rebrand. Building on CODO’s decade of brewery branding experience, this book will help you weigh your brand equity, develop your brand strategy and breathe new life into your brewery’s brand.

Want to work together?

Email Isaac to get started. 

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isaac@cododesign.com +1 (317) 403-3173
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CODO Design is an Indianapolis, Indiana-based food and beverage branding firm. We develop strategically-sound branding and packaging that cuts through the noise and drives long term revenue growth.


902 Virginia Avenue, Ste 200
Indianapolis, IN 46203

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