| Products, Services, and Brands: Building Customer Value 251

Chapter 8 | Products, Services, and Brands: Building Customer Value 251

be appropriate to a particular new product, even if it is well made and satisfying—would you consider flying on Hooters Air or wearing an Evian water-filled padded bra (both failed).

Each year, a survey by brand consultancy TippingSprung rates the year’s best and worst brand extensions. The most recent poll gave a strong thumbs-up to extensions such as Coppertone sunglasses, Mr. Clean car washes, Zagat physician ratings, and Thin Mint Cookie Blizzard (Girl Scout–inspired treat at Dairy Queen, which sold 10 million in only one month). Among the worst extensions—those that least fit the brand’s core values—were Burger King men’s apparel, Playboy energy drink, Allstate Green insurance, and Kellogg’s hip-hop streetwear. “Marketers have come to learn that the potential harm inflicted on the brand can more than offset short-term revenue opportunities,” says TippingSprung co- founder Robert Sprung. “But that doesn’t seem to stop many from launching extensions that in retrospect seem questionable or even ludicrous.” Thus, companies that are tempted to transfer a brand name must research how well the brand’s associations fit the new product. 39

Multibrands. Companies often market many different brands in a given product category. For example, in the United States, P&G sells six brands of laundry detergent (Tide, Cheer, Gain, Era, Dreft, and Ivory), five brands of shampoo (Pantene, Head & Shoulders, Aussie, Herbal Essences, and Infusium 23); and four brands of dishwashing detergent (Dawn, Ivory, Joy, and Cascade). Multibranding offers a way to establish different features that appeal to different customer segments, lock up more reseller shelf space, and capture a larger market share. For example, P&G’s six laundry detergent brands combined capture a whopping

62 percent of the U.S. laundry detergent market.

A major drawback of multibranding is that each brand might obtain only a small market share, and none may be very profitable. The company may end up spreading its resources over many brands instead of building a few brands to a highly profitable level. These compa- nies should reduce the number of brands they sell in a given category and set up tighter screening procedures for new brands. This happened to GM, which in recent years has cut nu- merous brands from its portfolio, including Saturn, Oldsmobile, Pontiac, Hummer, and Saab.

New Brands.

A company might believe that the power of its existing brand name is wan- ing, so a new brand name is needed. Or it may create a new brand name when it enters a new product category for which none of its current brand names are appropriate. For exam- ple, Toyota created the separate Scion brand, targeted toward millennial consumers.

As with multibranding, offering too many new brands can result in a company spread- ing its resources too thin. And in some industries, such as consumer packaged goods, con- sumers and retailers have become concerned that there are already too many brands, with too few differences between them. Thus, P&G, Frito-Lay, Kraft, and other large consumer- product marketers are now pursuing megabrand strategies—weeding out weaker or slower- growing brands and focusing their marketing dollars on brands that can achieve the number-one or number-two market share positions with good growth prospects in their categories.