Brand Extension: Importance of Marketing and Strategies for Success
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This project report explores the importance of brand extension in marketing and the strategies for success. It discusses the target market, analysis of the new market, and competition. It also focuses on Sony's brand extension for their PlayStation gaming smartphone.
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Sony PlayStation Brand Extension
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EXECUTIVE SUMMARY Aim of this project is reflect importance of marketing and how brand extension is considered to be one of the effective marketing tool in the competitive business environment. The methods of research in brand extension provides information regarding brand and brand value. A description of the target market and analysis of the new market is made so that threats and opportunities are used for brand extension. All the competitors available in the market must be analysed so that strategies to compete with the competition can be established. All the analysis concludes that various strategies in the market needs to be implemented in effective manner so that objectives can be achieved as planned.
Table of Contents EXECUTIVE SUMMARY.............................................................................................................2 INTRODUCTION...........................................................................................................................1 METHODOLOGY..........................................................................................................................1 FINDINGS.......................................................................................................................................1 Existing brand and brand values.................................................................................................1 Description of the target market..................................................................................................2 Analysis of the new Market........................................................................................................3 Explanation of the new product..................................................................................................4 Competition.................................................................................................................................4 CONCLUSION...............................................................................................................................5 REFERENCES................................................................................................................................6
INTRODUCTION Brand extension is the usage of established brand name for introducing a new range of products and services offered by the business organisation. In this project report Sony is making a brand extension for PlayStation by launching a new smartphone specifically designed for gaming purpose. Market for PlayStation and games in smartphones is explored to global level. Sony possess market share of 57% in this field (Harper and Endres, 2018). As per recent trends it can be noticed that more and more demand is generated for PlayStations. A new dividion is announced in this relation by Sony as Forwardworks. So that smartphones based on PlayStation gaming suits can be launched. METHODOLOGY Based on the data made available by the marketing trends of the past years it is seen that sales of PlayStation are increasing year by year. A decline in the sales for Sony PlayStation is recordedby12% asnonewtechnologicalimprovementismadetoenhanceconsumers experience using such products. As per financial statements and sales record and market share analysis helps to ascertained such detailed information. FINDINGS Existing brand and brand values Brand is defined as a name, design, symbol and logo or nay other feature that helps in identifying a seller and made them different form various sellers available in the market. Organisations like Sony that possess already existing brand image made brand extension through which a new product is marketed in the name of the organisation. Brand extension helps businesses to improve their portfolio and it becomes easy for consumers to accept a product offered under a existing brand name (Kapferer’sBrand Identity Prism,2018). In order to understand brandingKapferer’sBrand Identity Prism model is used which is explained as follows- In the year 1996, Jean-Noel Kapferer's defined six elements that helps a organisation in order to ensure branding. The six elements are- Physique:This defines physical characteristics of a brand. As it helps consumers to visualise and identify the product. 1
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Personality:In this element brand is treated as a personality that individuals possess it includes style, attitude and colour of the brand. Culture:It defines set values that are followed by business organisation in order to ensure foundation of the brand. For example- reflection of the culture of origin country. Self-Image:In this stage brand can be used as self-image of an individual. Reflection:At this stage brand portrays its target consumers. For example- portraying consumers in good mood when played with Sony PlayStation games. Relationship:Thiselementdefinesrelationshipdevelopedinthebrandandits consumers. Source: Kapferer’s Brand Identity Prism, 2018 Description of the target market In order to ensure target marketSTPapproach is used which is considered to be a modern marketing approach for business organisations. It stands for Segmentation, Targeting and Positioning. Sony organisation needs to split market into smaller groups so that needs of 2 Illustration1: Kapferer’s Brand Identity Prism, 2018
consumers can be identified easily. Through targeting a suitable target market is selected in which provided goods and services can be sold (Keller and Brexendorf, 2019). At last a position is enjoyed in which product enjoys benefits in relation to the competition such as Nintendo and Microsoft. Individuals belong to the age of 16 to 30 both male and female are targeted consumers of the new product. Analysis of the new Market In order to analyse external threats and opportunities available in UK market where this new gaming smartphone of Sony will be launched required PESTLE analysis. Elements of ThreatsDescription Politicalď‚·Economic instability in the UK market. ď‚·Governmentpoliciestohelplocalbusinessestocreatea business opportunity for them. Economicalď‚·Sharp fluctuation while trading in different currencies. ď‚·Dependency on US Fed interest rate scenario. Socialď‚·Growth in demand of products which served as a value added product. ď‚·Shaft in the demand for digital products. Technologicalď‚·Shift of the gaming industry towards advanced technology and Virtual reality. ď‚·Goodtechnologicaldevelopmentisanopportunitytoearn more. Legalď‚·Delayinlegalproceduresmadevariousopportunities unachieved. Environmentalď‚·More and more protection towards development of goods which are environmental friendly minimises usage of technological goods. Ansoff Matrix-It is defined as a communication tool through which all the growth strategies are identified. Their are four elements in the matrix such as Market Penetration, 3
Product Development, Market Development and Diversification. Among all Sony is using Marketing Penetration strategy for growth as new smartphone which is specifically launched in the market specifically for gaming purpose (Marchand, 2017). As per this strategy existing products(smartphones) are introduced in the already existing market of UK. Explanation of the new product The new product introduced by Sony is a smartphone that is specialises in gaming with minimal lag, stuttering and ensures optimal performance. As the usage of smartphones is increasing among all age group and introducing a smartphone for games will help in growth of business. Competition BasisSonyNintendo Diversity of GamesThis organisation offers a wide variety of Video-games where gamers can make a selection formmanytypesofgames made available to them. Form innovationsandnew improvementsmadeinthe Sony PlayStation new gaming titles will be introduced so that level of consumer satisfaction can be improved. WhenNintendoiscompared withSonythenitcanbe recorded that it possess lesser variety in gaming titles. This makesgamingportfolioof companysmallerandless attractive. Although the variety islessanddoesnotseems attractive instead of this all the video-gamesofferedbythe company is well-received by gamers. Technological considerationSonyintroducesitsgames through PlayStations in which variousvideogamesare available and users can play andenjoy.Sonylacksin technologicaldevelopmentin considerationtoNintendoas Aeffectivetechnological improvement is made by the organisationthroughwhich Nintendoorganisation providesNintendo'sswitch which allows users to expand their storage with micro SDHC 4
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its latest PlayStation 4 does not supports external hard drives for storage expansion. card.Thistechnological advancementmadeNintendo morecompetitiveinthe gaming market in comparison to Sony. Portfolio of productsSony enjoys one of the greatest strength form Nintendo is the grate amount of diversification in its portfolio. As Sony is one of the well known brand in the electronic industry and gaming is one of the extension of the brand. Already existing brand imageofthecompanyin various markets helps business to expand their brand with new products. In the present time Nintendo is onlyfocusedinthegaming industrywhichminimises availabilityofproduct portfolio with the business and do not help in establishing a goodbrandimageofthe businessinthemarketin comparison to Sony (Shay and Palomba, 2018). CONCLUSION From the above project report it has been concluded that brand extension is one of the effective branding strategy for business so that new market can be acquired to enjoy large market share. In order to make extension existing brand and target market needs to be analysed so that effective strategy can be initiated. Market analysis for threats and opportunities and new product specifications must be known so that competition is analysed and decision is taken on some basis. 5
REFERENCES Books and Journals Harper, D. A. and Endres, A. M., 2018. From Quaker Oats to Virgin Brides: Brand capital as a complex adaptive system.Journal of Institutional Economics.14(6). pp.1071-1096. Keller,K.L.andBrexendorf,T.O.,2019.Measuringbrandequity.InHandbuch Markenführung(pp. 1409-1439). Springer Gabler, Wiesbaden. Marchand, A., 2017. Multiplayer features and game success. InNew Perspectives on the Social Aspects of Digital Gaming(pp. 97-112). Routledge. Shay, R. and Palomba, A., 2018. First-Party Success or First-Party Failure? A Case Study on AudiencePerceptionsoftheNintendoBrandDuringtheWiiU’sProductLife Cycle.Games and Culture, p.1555412018813666. Online Kapferer’sBrandIdentityPrism.2018.[Online].Availablethrough: <https://howbrandsarebuilt.com/blog/2018/12/21/the-brand-identity-prism-and-how-it- works/> 6