By: Arun Chogle, Client Business Partner, Nielsen India
- Four ARRC factors critical to a successful stretch – Advantage, Recognition, Relevance & Credibility
- Apply a three-way framework of Market Structure, Brand Leverage and Company Competence to make your stretch profitable
In part one of the Brand Stretch Series, we defined what a brand stretch is and the advantages it has over a new brand launch. In the following part, we looked at the factors for success in a stretch strategy. In this third and concluding edition, we explore the ARRC factors which every brand must leverage, and a framework to unleash the power of a brand stretch.
To recap the methodology adopted for the study, we conducted a 360-degree evaluation by:
- Studying the in-market sales and market share performance of 82 brand extensions across 46 categories in India
- Soliciting responses of a diverse group of marketing professionals to understand the practitioner’s perception
- Analysing consumer responses to over 65 brand stretch initiatives that were tested amongst consumers in the Nielsen BASES database.
While research has established that brand extensions have shown a greater probability of success compared to a new brand launch, the reality is that one out of two brand extensions were still likely to fail. To understand what considerations made consumers adopt brand extensions more readily, we dived into our BASES database and found four key measures that influenced Purchase Intent* of consumers and thereby consumer acceptance. We call these the ARRC factors that every brand stretch must leverage.
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