Extending a Brand
All brands have a niche or specific market that provides most of its revenue. To successfully extend a brand out of its home market is a difficult thing but can substantially increase revenue. This article provides an example of a plan for a brand extension.
The product I picked for a brand extension is the Coach product line. Specifically, my plan
is to expand the brand to extend from handbags and accessories into premium interiors for luxury cars. Currently, I know of no competitor company in this field.
The plan to create and takeover this market has several stages: 1) research; 2) develop courses of action; 3) select best course of action; and 4) implement.
First step in getting this plan in motion is to research. Things I need to know are basic
facts on the Coach company and basic facts on luxury car interiors.
Coach is a multi-million dollar, international company that sells image. It does so through ladies' handbags, wallets, sunglasses, etc. at extremely high prices. For its target market, it has major brand equity. The mere mention of the name excites some women. In our society, it is a status symbol. Buying one of these overly-priced purses is a way husbands and boyfriends can rack up some huge points for the ladies in their lives. I did that very thing recently, which is what got me thinking about the Coach company. The brand has such respect among the female consumer population that a "Coach interior" could easily be the deciding factor of a luxury automobile purchase. According to their website, Coach makes handbags, purses, brief cases, luggage, sunglasses, jewelry, jackets, watches, key rings, and wallets. Coach's main competitors in the
upscale handbag/accessories market include Gucci, Louis Vitton, Fendi, and Prada. What sets Coach products apart from the plethora of generic handbags is the image differentiation phenomenon associated with its label. Its label is instantly recognizable and coveted among shelves of perhaps otherwise similarly looking generic handbags.
Luxury car interiors do not have a well-known, "household" brandname associated with them. Most seem to be created by the car company from standard generic materials. One of few examples I have come across of a car advertisement playing up its luxurious interior was a few years ago when Ricardo Montalban told us about the "soft Corinthean leather" in Chrysler's latest
sedan of the early 1980's. With Coach as the brand associated with their interior, a luxury car should have a decided advantage over its competitors.
Courses of Action
Basically, this step is to come up with the right car line to partner with. Obviously, this would work best with luxury vehicles that target status-minded consumers ready to spend a fair amount of money. Coach is a worldwide phenomenon, so potential partners might be worldwide car companies, vice automakers limited to one country. Worldwide, Toyota is the biggest. With their upscale Lexus line, Toyota is a good possibility. After Toyota, General Motors is the most prolific car company. The Cadillac line would be their candidate. Mercedes, BMW, and Audi are all possibilities from Germany.
Because Cadillac is known worldwide and has a wide range of models in the targeted price range, $35,000 - $100,000, I choose to partner Coach with them.
To get this idea sold to the buyers, Cadillac would have to highlight this option in their commercials and print advertisements as something exclusive to them. High-end magazines read by wealthy women would be a good place to focus the marketing effort. This option could be pricey because anyone considering it would be in the midst of purchasing a high-priced vehicle. This could have spillover effects for Coach. Every lady wants to coordinate her accessories. If someone
purchases a Cadillac with exclusive Coach interior, it would be a good bet that Coach purses will be in her purchasing future.