What is brand extension? When an already well established brand uses its name to extend outwards into other product categories, this is what is called brand extension. Brand extensions are quite popular nowadays for multiple reasons. Let’s take Nike here as an example. Nike’s core products are shoes, and they’ve gathered a mighty following by selling all kinds of shoes. However, they’ve since extended and now also offer basketballs and sunglasses, just to name a few. Now, Nike is a parent brand to its brand extensions. And, as you can see, these extensions don’t have to relate to the original product, as the whole point of them is to attract both current and potential new customers. Those who love Nike shoes will be much more inclined to try their sunglasses or basketballs as well. In essence, since Nike has a strong brand image and name, consumers will more easily accept the extension, as it has the same values and aspirations as the core brand Nike. By extending a brand, businesses can evaluate product category opportunities. Furthermore, they can identify resource requirements and even lower their chances of failure. Moreover, they can get insight into how relevant and appealing the brand is.