Review of Professional Management- A Journal of New Delhi Institute of Management

Ritu Talwar ¹

Affiliations
1 New Delhi Institute of Management, New Delhi, IN

Abstract

No Abstract.

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Ritu Talwar ¹

Affiliations
1 New Delhi Institute of Management 50 (B&C) Tugh. Institutional Area, N.D.-62, IN

Abstract

The purpose of this article is to critically analyse success and risks of the strategy of brand extension or commonly called brand stretching. A brand is an amalgam of the notional images of physical products that go with the brand. Brand awareness is the ability of a potential buyer to recognize or recall that a brand is a member of a certain product category. A link between product class and brand is evolved and image is built by people's perceptions, that is, the way in which people think about or even imagine product to be. Old brands help bind consumers to their past and to the communities that shared those brands. Brand extension is always seen as a way for companies to seek growth while introducing a new product. Many companies adopt brand extension as a strategy with the aim of benefiting from the brand knowledge achieved in current markets. Brand extensions is built on existing Brand Equity. These are less expensive to launch as compared to launching an entirely new brand, and are a low risk option in these competitive times. It has been estimated that the market shares of new products using a brand extension strategy are on average 5 percent higher than those of new products marketed under new brands. Some researchers have suggested that brand extension strategies may carry the risk of diluting important consumer trust in the parent brand. But 30% of revenue of top 23 most trusted brands FMCG come from Brand Stretching.

Keywords

Brand Extension, Brand Stretching, Brand Knowledge, Generic Products.

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Ritu Talwar ¹

Affiliations
1 New Delhi Institute of Management, IN

Abstract

Fabindia is India's largest private platform for products made from traditional techniques, skills and hand-based processes. Fabindia's products are natural, craft based, contemporary, and affordable. This retail outlet promotes unique model of inclusive capitalism that procures through COC (community owned companies). Fabindia's model acts as the value adding intermediaries i.e. between the company and rural producers in India. It has established links with over 80,000 craft based rural products for modern urban markets. Thereby the company has been contributing to the process of creating a base for skilled and sustainable rural employment as well as preserving India's traditional handicrafts. These Rural Craft Companies connected to Fabindia are owned by the local communities of artisans; a minimum 26% shareholdings of these companies are that of craft persons. Fabindia has established its own social standard in India and abroad. Today Fabindia is a major player in the retail handloom sector in India due to the fact that the company has always believed in "good business practices and never compromised on best quality". Fabindia believes that a delighted customer is their best Brand ambassador. Their USP in marketing lies in quality of fabric. The company heavily relies on the word of mouth marketing. They say 83% of customers go satisfied and 59% go highly satisfied as told by Bissel to Economic Times. This revolutionary organization is said to be the next big thing in societal betterment through its commitment to Corporate Social Responsibility, Value based Marketing and Exemplanery HR Practices.

Keywords

Community, COC, Retail, Inclusive Capitalism.

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