What is brand dilution? How to avoid brand dilution?
Brand dilution is a major issue for many companies. It's important to understand the concept and how it might be affecting your company. In this blog post, we'll examine the definition, causes of brand dilution and some ways that companies can avoid it from happening.
Brand dilution is a major issue for many companies. It's important to understand the concept and how it might be affecting your company. If this happens, the company's brand awareness may fall down and can be easily beaten by competitors. In this blog post, we'll examine the definition, causes of brand dilution and some ways that companies can avoid it from happening.
What is brand dilution?
Brand dilution is the process in which a company's brand becomes less distinctive, recognizable or meaningful because it has expanded into too many unrelated products.
When does brand dilution occur?
Brand dilution may occur in cases as below:
Brand dilution may occur when a company’s failed brand extension is closely related to their flagship product.
When a company lauch a failed brand extension which is closely related to their flagship product, customers will question about the company's specialization and production ability.
For example, company Chick5 is very good at making chicken wings. Their sales of chicken wings were very good. After a year, they launched the next product line - chicken thighs. Unfortunately, their chicken tighs were low rated by their customers. This has made the customer also feel bad about their chicken wings and the brand Chick5 also.
Brand dilution can occur when a company's brand extension is not related to their flagship product.
When a company launches brand extension which is not related to their flagship products, the customers also think that the company is trying too many things and lack of focus in their brand. It makes consumers feel less loyal to the original product and its parent company.
For example, let's say company MSG-5stars is well-known as providing MSG. As the company grow, the company has launched a new product line: cookies. The sales of the new product line was not good because consumers think MSG-5stars can only be good at making MSG. Meanwhile, the new product line has diluted its brand name.
Brand dilution can occur when a company has many versions of logo at the same time.
Brand dilution can occur if a company has many versions of logo at the same time. I makes customer find hard to recorgnize the company brand. It also makes customers feel it's not trustworthy and not sure about their products/services.
How to avoid brand dilution?
There are some guidelines should be followed in order to avoid brand dilution:
Always focus on the company core competency.
By focusing on its core competency, the company would become more successful and less like to face the brand dilution.
Becareful in brand extension.
When the company is planning to launch a new product line, they should think about this carefully. The future of their previous flagship products will be at stake if there are too many failed brand extensions.
Consider create a new brand for a new product line.
When the company decides to launch a new product line, they should consider to create a new brand. This way consumers will see this product as an independent brand which do not have any relations with the parent company.
Use only one version of logo for a brand at a time.
The company should only use one version of logo for a brand at a time. This is because too many versions of logo will confuse customers and dilute the original company brand.
Conclusion
These are all good-enough guidelines for avoiding dilution of your brand. If you're considering launching a new product line, make sure to follow these tips carefully and avoid the mistakes that other companies have made in order to maintain your company's integrity as well as customer loyalty.
Frequently Asked Questions (FAQ)
Brand dilution is the process by which a brand loses its distinctiveness and uniqueness, and becomes less recognizable to consumers.
Brand dilution can be caused by a number of factors, such as overexposure, diversification, and poor quality control.
The consequences of brand dilution include loss of customer loyalty, decreased sales, and a damaged brand reputation.
To avoid brand dilution, you should maintain consistency in your branding efforts, focus on your core values, and carefully manage your brand extensions.
To restore a diluted brand, you should conduct market research to identify the root causes of the problem, reposition your brand, and communicate your new brand message effectively to your target audience.
