Brand extension strategy refers to the use of the reputation of a successful brand to launch improved products or new products, including new packaging specifications, fragrances and styles. Brand extension is a basic strategy for brand management. After correct brand positioning, it is necessary to choose the right time to extend the brand. In the fierce market competition, brand extension is a powerful means to prove brand value, enrich brand image, maintain and consolidate the original brand position; it can be said that brand extension, as an important link in the whole process of brand establishment, is a phased adjustment of brand operation and an effective use of brand assets.
Most of the world’s famous companies rely on brand extension to achieve their rapid expansion. Every company that achieves brand extension must choose its own extended product type, evaluate consumers’ perception of the parent brand, design and implement extended brand marketing plans, shape a unique brand personality, and form a unique market value to attract relevant consumer groups. Although brand extension has positive effects such as being conducive to the expansion of enterprise scale, dispersing business risks, meeting the diverse requirements of customers, and being conducive to subsequent brand extension and brand protection, there are also certain potential risks, such as damaging the image of the original brand, diluting the brand, going against consumers’ consumer psychology, and causing retailers to boycott. Only by scientific planning and ensuring the optimized segmentation of the market and the optimized integration of channels can we ensure the safety of brand extension, the image of the original brand will not be damaged, and the recovery and sustainable development of the enterprise.