Know-How Exchange : Branding

I would create a brand for the new product, but incorporate into your log home marketing. As you said, this is a niche audience. You can still market your new brand to a larger demographic, but it seems to me that your biggest support may come from your primary market.

I'd suggest creating a new brand, since you'll be marketing to a different group of people with different needs than your existing log homes. Perhaps, create a division of your company, so you could say "Clapboard Homes: A Division of Log Home Producer, Inc." That way you keep the connection to your "parent" company (where you can leverage your nationwide dealership & quality image).

New brand. Listen to your gut.

When we are called in on projects like this, the first question we ask is whether the target audience is the same and whether the benefit is the same. If either one is different, chances are pretty good that you need a new brand to avoid confusion or dissonance in the marketplace.

From what you've shared with us, this sure looks like a situation where you want a new brand -- especially given that your company name is so specific to the current market/benefit.

At first I was thinking to use the same brand, to gain from the brand equity you already have. But I don't have a preconception of log houses. If there is an image of log houses in many people's minds, and that image is not useful to the new product, then I agree with the new brand route.

What is the long-term prospect for your existing brand? If it faces a diminishing market, then create a new brand based on your new product and evolve your company over the next couple of years to be principally centered on the new brand, while carrying the legacy brand as a smaller portion of the business.

However, if the new product is also going to be a specialty brand with narrow market appeal (rather than mass appeal), you might be more cautious. It is still a log-based product and would technically fit under the "log home" name.

Bottom line is this: A company with a narrow product line that wants a much broader audience needs to name their brand after whatever gains the broader audience. In your case, it might be that a new kind of log home is not broad enough, and possibly a third product (perhaps not log-based) is needed to appeal to a larger audience. In that case, the effort to establish a new brand should be made for that third product rather than the one at hand.

One consideration here is that a new brand requires a lot of additional, sustained marketing expense, and chances are that money will be spent in media you are not presently using -- meaning it's a much bigger deal than just making your current ads a little larger wherever they are currently running. If your company is large enough to support that additional expense, good. If your company would not be in a position to spend healthy amounts to promote the new brand, then the new brand will have trouble getting out of the blocks and you'll be left with ineffective marketing that's more expensive than what you have now, but which may produce only marginal gains and might also require additional staff to operate.

Bottom line: Create a ratio of new brand expense to potential income or market growth and make your decision that way. If additional marketing spend for a new brand will bring your company significant new revenue, then go for it. If not, then don't, even though it's emotionally appealing. If you don't know enough to forecast the potential new brand's numbers yet, then you need to survey your target market more thoroughly before you make this decision.

Hope these thoughts are helpful.