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CATEGORY EXTENSION:
WHY IT’S RISKY, HOW TO DO IT RIGHT

October, 2018

Ever seen a brand release a new product that makes you wonder, “What were they thinking?” Often this happens when a brand that’s known and loved for a specific product ventures into a completely different category of products. This is called brand or category extension. Using your brand to enter into an unrelated product segment can by risky. Even if your brand is well-known, slapping its name and logo on any product won’t automatically make that venture a success.

While there are undoubtedly cases where brands have taken a chance and attempted category extension with positive results, there are probably more cases where brands have flopped, or have left their consumers scratching their heads.

" Even if your brand is well-known, slapping its name and logo on any product won’t automatically make that venture a success. "

This happens for a few reasons: for one, a category extension should be at least somewhat relevant to your brand. There was a case in the 1980’s when Colgate brand, known for their dental products, released a line of TV dinners. It didn’t matter how appetizing their frozen meals looked on the packaging, ultimately the image of Colgate’s logo paired with a vegetable and rice dish just didn’t mesh. Secondly, though your brand may try to push a product onto your consumers that may seems somewhat related to your brand, perhaps your brand is too associated with its already well-known and loved products for that category extension to work. A good example of this would be when McDonald’s tried selling pizza at its stores, or more recently, when KFC released a fried chicken-flavored edible nail polish. Or perhaps you’ve come up with a product to release under your brand’s name that you think might fulfill an unmet consumer need, when there was never a need for it at all. When Heinz released green ketchup in the 2000’s, the product was initially met with relative success, but by the time they added blue and purple colors to the line, the novelty had already worn off.

Still, there are triumphant examples of category extensions. Some are pretty out there, and probably worked because of the time in history in which they occurred...for example, the Guinness Book of World Records, which was initially conceived in 1955 as a marketing giveaway campaign for the beer company, eventually evolved into a globally recognized category extension. Another example would be the Michelin Guide - initiated in 1926 as a way to boost car sales and get people to travel and try out new restaurants, the tire company’s restaurant guide is now the most trusted source for haute cuisine - earning stars from the guide signifies the utmost level of prestige.

Some more recent and relevant examples of good brand extension range in a variety of categories - the creation of O Magazine under Oprah Winfrey’s personal brand, or soap brand Dove venturing into hair products and skincare. Why do some of these category extensions work, while others fail?

" If done right, a category extension can have many advantages. "

Well, for starters, you should make sure a product you plan to release under your brand is somehow relevant. Think of your brand equity - you don’t want a category extension to make your consumers lose trust in your brand. Having that in mind, be sure that your brand extension somehow fulfills an unmet consumer need. This is especially failsafe if you’re able to identify a need that consumers didn’t even know they had. There are more and more opportunities to do this in the Digital Age - think Amazon.

Does it seem to risky to you? Well, if done right, a category extension can have many advantages. Besides the obvious, sales-wise, brand extension could potentially improve your brand image and visibility, increasing your brand equity. It can be a good way to invigorate your brand if it’s dated and in need of a refreshing. Additionally, if your brand is already well-known, you won’t have to spend too much in advertising and promoting.

If you’re thinking of spicing up your brand with a brand extension, you can count on us here at 121 to do everything in our power to uphold your brand equity. We know the risks that expanding into a new category brings, so we know what mistakes to avoid. Get started by giving us a call, let’s explore the possibilities!

WWW.121CORP.COM PRIVACY POLICY

This privacy policy has been compiled to better serve those who are concerned with how their 'Personally identifiable information' (PII) is being used online. PII, as used in US privacy law and information security, is information that can be used on its own or with other information to identify, contact, or locate a single person, or to identify an individual in context. Please read our privacy policy carefully to get a clear understanding of how we collect, use, protect or otherwise handle your Personally Identifiable Information in accordance with our website.

What personal information do we collect from the people that visit our blog, website or app?

When ordering or registering on our site, as appropriate, you may be asked to enter your name, email address, phone number or other details to help you with your experience.

When do we collect information?

We collect information from you when you subscribe to a newsletter, fill out a form or enter information on our site.

How do we use your information?

We may use the information we collect from you when you register, make a purchase, sign up for our newsletter, respond to a survey or marketing communication, surf the website, or use certain other site features in the following ways:

• To send periodic emails regarding your order or other products and services.

Consent

We’ll ask for your consent before requesting any type of information, it’ll also be optional to do so. You can also easily withdraw it or change it at any time. However, failure to provide that consent will prevent us from delivering content and other experiences to you.

Where do we storage your data?

We store all your data exclusively on our servers for at least a year, and we are the only ones that have access to them.

How can you access to your data?

You can exercise, at any time, the rights of access, rectification, cancellation and opposition of your personal data via email, addressed to privacidad@121corp.com indicating your name, surnames, telephone number, attaching a photocopy of your ID or official document that proves your identity and clearly indicating the right you wish to exercise.

How to ask us to delete your data?

If you would like to unsubscribe from any of our communications you may do so by sending us an email to privacidad@121corp.com. Otherwise, by continuing to interact with our emails, you provide us with permission to manage and use your data as described above.

How do we protect visitor information?

We do not use vulnerability scanning and/or scanning to PCI standards.

We use regular Malware Scanning.

Your personal information is contained behind secured networks and is only accessible by a limited number of persons who have special access rights to such systems, and are required to keep the information confidential. In addition, all sensitive/credit information you supply is encrypted via Secure Socket Layer (SSL) technology.

We implement a variety of security measures when a user enters, submits, or accesses their information to maintain the safety of your personal information.

All transactions are processed through a gateway provider and are not stored or processed on our servers.

What happens if there’s a data breach?

We will inform all of our users within the first 72 hours.

Do we use 'cookies'?

We do not use cookies for tracking purposes

You can choose to have your computer warn you each time a cookie is being sent, or you can choose to turn off all cookies.
You do this through your browser (like Internet Explorer) settings. Each browser is a little different, so look at your browser's Help menu to learn the correct way to modify your cookies.
If you disable cookies off, some features will be disabled that make your site experience more efficient and some of our services will not function properly.
However, you can still place orders .
Third Party Disclosure

We do not sell, trade, or otherwise transfer to outside parties your personally identifiable information.

Third party links

We do not include or offer third party products or services on our website.

Google

Google's advertising requirements can be summed up by Google's Advertising Principles. They are put in place to provide a positive experience for users.
https://support.google.com/adwordspolicy/answer/1316548?hl=en

We use Google AdSense Advertising on our website.

Google, as a third party vendor, uses cookies to serve ads on our site. Google's use of the DART cookie enables it to serve ads to our users based on their visit to our site and other sites on the Internet. Users may opt out of the use of the DART cookie by visiting the Google ad and content network privacy policy.

We have implemented the following:
• Google Display Network Impression Reporting
• Demographics and Interests Reporting

We along with third-party vendors, such as Google use first-party cookies (such as the Google Analytics cookies) and third-party cookies (such as the DoubleClick cookie) or other third-party identifiers together to compile data regarding user interactions with ad impressions, and other ad service functions as they relate to our website.

Opting out: Users can set preferences for how Google advertises to you using the Google Ad Settings page. Alternatively, you can opt out by visiting the Network Advertising initiative opt out page or permanently using the Google Analytics Opt Out Browser add on.

California Online Privacy Protection Act

CalOPPA is the first state law in the nation to require commercial websites and online services to post a privacy policy. The law's reach stretches well beyond California to require a person or company in the United States (and conceivably the world) that operates websites collecting personally identifiable information from California consumers to post a conspicuous privacy policy on its website stating exactly the information being collected and those individuals with whom it is being shared, and to comply with this policy. - See more at:
http://consumercal.org/california-online-privacy-protection-act-caloppa/#sthash.0FdRbT51.dpuf

According to CalOPPA we agree to the following:

Users can visit our site anonymously
Once this privacy policy is created, we will add a link to it on our home page, or as a minimum on the first significant page after entering our website.
Our Privacy Policy link includes the word 'Privacy', and can be easily be found on the page specified above.

Users will be notified of any privacy policy changes: • On our Privacy Policy Page Users are able to change their personal information: • By emailing us

How does our site handle do not track signals?

We honor do not track signals and do not track, plant cookies, or use advertising when a Do Not Track (DNT) browser mechanism is in place.

Does our site allow third party behavioral tracking?
It's also important to note that we allow third party behavioral tracking

COPPA (Children Online Privacy Protection Act)

When it comes to the collection of personal information from children under 13, the Children's Online Privacy Protection Act (COPPA) puts parents in control. The Federal Trade Commission, the nation's consumer protection agency, enforces the COPPA Rule, which spells out what operators of websites and online services must do to protect children's privacy and safety online.

We do not specifically market to children under 13.

CAN SPAM Act

The CAN-SPAM Act is a law that sets the rules for commercial email, establishes requirements for commercial messages, gives recipients the right to have emails stopped from being sent to them, and spells out tough penalties for violations.

We collect your email address in order to:

To be in accordance with CANSPAM we agree to the following:

If at any time you would like to unsubscribe from receiving future emails, you can email us at
• Follow the instructions at the bottom of each email. and we will promptly remove you from ALL correspondence.

Contacting Us

If there are any questions regarding this privacy policy you may contact us using the information below.

www.121corp.com
7315 Winsconsin Avenue, Suite 400 W
Bethesda, MD 20814
USA
privacidad@121corp.com

Last Edited on May 25, 2018