Brand extension or
brand stretching is a
marketing strategy in which a firm marketing a product with a well-developed image uses the same
brand name in a different product category. The new product is called a
spin-off. Organizations use this strategy to increase and leverage
brand equity (definition: the net worth and long-term sustainability just from the renowned name). An example of a brand extension is
Jello-gelatin creating Jello pudding pops. It increases awareness of the brand name and increases profitability from offerings in more than one product category.