Relates evidence which suggests that launching a vertical brand extension generally has a negative impact on the core brand because it dilutes the core brand image, advising that a brand extension should be introduced only when its profit potential exceeds the losses that will be sustained as a result of damage to the core brand. Describes two important tools which can reduce the dilution of the core brand image and/or enhance the success of a new brand extension introduction distancing, and information cues: Explains that, to reduce damage to a valuable core brand or to benefit a new step‐up brand extension, the extension should be maximally distanced from the core brand; however, to benefit a new step‐down brand extension (at the expense of the core brand), the extension should be positioned close to the core brand. Highlights how information cues that describe a brand extension can also act like distancing techniques, simply by serving to reinforce the similarities (implied closeness) or differences (implied distance) between the brand extension and the core brand.
Kim, C.K. and Lavack, A.M. (1996), "Vertical brand extensions: current research and managerial implications", Journal of Product & Brand Management, Vol. 5 No. 6, pp. 24-37. https://doi.org/10.1108/10610429610152813Download as .RIS
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