| Summary: | Brand extension strategy (introducing new product under the strongest
brand name) is one of the many ways in which PT. SOHO Pharmacy Industry
utilizes Fitkom�a strong brand asset that has a solid basis of consumers. The
justifications to use brand extension are for business growth and for minimizing
the risk of failure and the cost of new product.
This case study aimed to understand the implementation of brand
extension strategy on Fitkom. Interview technique was compiled toward key
components such as the rationale for using brand extension strategy, stages taken
by SOHO in strategic development of brand extension, the role of marketing
managers in evaluating critical factors that influence brand extension strategy,
and success indicators of brand extension strategy.
The research concluded that in general SOHO implements brand
extension strategy with the purpose of increasing business growth and market
share in the children�s food and beverage category. In addition, SOHO also
implemented the following stages in developing the brand extension strategy: the
identification of brand associations, the identification of products linked to those
associations and the selection of the best candidate from that product list for
concept testing and new-product development.
Moreover, managers in SOHO hold important role in evaluating the
characteristics of the parent brand and the product category that the company is
planning to enter. SOHO has determined the indicators for a successful brand
extension strategy, they are: the increase of sales volume and market share for
both new products and overall products, and also maintained quality of Fitkom
brand. good brand equity for Fitkom.
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