There are various scenarios where a brand has successfully extended or failed to extend. For example, Bic ballpoint pens. It extended successfully into disposable razors but the extension into perfumes was a failure.
The factors that influence acceptability of a brand extension are mainly −
● Perceived risk − It is the evaluation of uncertainty about the type and degree of expected loss after making the consumer makes a choice.
● Consumer’s Innovativeness − Personal trait or desire of consumers to try a new brand/product and thereby experience something new.
● Product Similarity − Greater the degree of similarity of the extended product with the original product, more is the chance of transferring the positive effect.
● Parent Brand Reputation and Strength − Brand’s reputation is associated with the consumer’s perception of the quality of the brand. Strong and reputed brands leverage extension than weak brands.
