brand diversification new categories
New Categories. In consumers’ eyes, many brands stand for much more than what they actually offer or what their owners concede them credibility for.

Entering new product categories does not require the invention and development of new, innovative products. The brand diversification concept makes use of the extension of brands into proven products for which product technology, manufacturing capacities and distribution channels are already established.

Three criteria need to be considered. Firstly, the new category has to fit the brand. Secondly, it should be weakly branded or fragmented, and categories suffering strong brand competition should be avoided. And thirdly, a strong business partner needs to be available who has the experience and resources within the category and who can capitalize on the use of the brand.
Example? A well-known brand for cranes would certainly have the competence and credibility for various types of aluminium ladders. This category is weakly branded and fragmented. Some of the unknown suppliers in this category would be interested in using the well-known crane brandname on their established ladder ranges. The example is analogically applicable for scaffolds or wheelbarrows.