Thursday, March 4, 2010

Brand Extension

A Brand Extension is defined as "using a successful brand name to launch a new or modified product in a new category" (Kotler 221). My example is the XBOX video game console. XBOX is the first Microsoft product in the video game console industry. The Xbox was released on November 15, 2001 in North America, February 22, 2002 in Japan, and March 14, 2002 in Australia and Europe.

Microsoft successfully used its brand name which is the symbol of world technology leader in consumers' minds to launch its gaming console, XBOX, in the console market. XBOX was instantly recognized as the gaming console with the latest technology in the world and it was fast accepted by consumers worldwide.

Region Units sold
(as of May 10, 2006)
North America 16 million November 15, 2001
Europe 6 million March 14, 2002
Asia 2 million February 22, 2002
Worldwide 24 million

Unlike spending huge on building a new brand name and advertising it, XBOX entered the gaming console market and jumped to be the strongest competitor of Sony's PlayStation, which is the biggest giant in the industry. Without the reputation of the brand of Microsoft, it is hard to imagine that consumers would recognize and accept the new product so rapidly.

Bo Jiang

MKTG 301 E

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