Entering into new related categories is a crucial step for a business in its growth journey. On one hand, new categories allow for a business to acquire new customers, as a new-er category may be more relevant for a number of customer segments. Moreover, it also allows brands to get a bigger share of wallets from the same customer, as the business is serving more needs/ use cases for the customer. And lastly, diversifying the product categories also helps in de-risking the business in external risks and circumstances like we have seen a pandemic can bring.

Category extensions enable you to serve more than one need of your customers. And given you have met the expectations on quality, durability, etc., the customer is likely to come back to you for other categories as well. “So this is how you ensure more repeats and retention, which in turn increases the lifetime value of a customer for your business,” Adarsh Sharma, Chief Revenue Office, Fablestreet said.

Brands Entering Newer Categories

In the past year, several brands have ventured into new categories.

Fabindia, which has always been a leader in the fashion, home furnishings, and decor category, launched a personal care line, called FabEssentials, in December last year. Targeting both males and females in the age group of 20-50 years, the brand has introduced 90 Fabessentials products until now, including face washes, milk cleansers, and toners, lip butter, hand washes, and lotions, body washes and lotions, body butter, body sprays, shampoos, conditioners, hair masks among others.

“FabEssentials was formed with an endeavor to create scientifically-backed personal care products made in India, that were free of endocrine disruptors and harmful ingredients. We personally wished to create a range to showcase the power of natural bio-actives, by sourcing extracts from nature that catalyze one another and deliver results that benefit a person on the inside as well as outside. My ideology remains to bring health and personal well-being into universal consciousness and make it an affordable ‘luxury’ for day-to-day use,” Fabindia spokesperson said.

Meanwhile, W, a women’s fashion brand from TCNS Clothing, ventured into the cosmetics category in February this year. Launched under the brand name ‘W Beauty’, this range consists of 100+ SKUs that have lip, eye, nail, and face products. The face palettes include a combination of bronzer, highlighter, and blush. The lip category consists of four ranges of products, including creamy matte lipstick, liquid lipstick, long-wearing lipstick, and lip crayon. In the eye range, there are crayons and palettes that come in a pack of four. Furthermore, there is a wide range of nail enamels. W Beauty’s entire collection is exclusively available at select W stores, the W website, and Myntra, with a starting price of Rs 199 for nail enamels and Rs 499 for products in the face, lip, and eye categories.

Since its inception in 2016, Fablestreet had focussed on and established strong recognition as a premium workwear brand for women. However, analyzing the changing external environment led it into launching the very first of its kind WFH collection - it had more relaxed silhouettes in breathable cotton in linens as people required more comfort in their clothes while working from home. As the next step, the brand also introduced knits, including tees, dresses, etc. As the situation started easing and lockdowns were lifted, Fablestreet saw that people wanted to continue the element of comfort in even what they wear outside, so it extended its knits to a more elevated look. The brand launched “LivIn”, a concept in breathable and stretchable pants, tees, dresses, and skirts that can be worn anywhere and while doing any activity. Lastly, it further expanded into smart casuals, evening wear, and party wear to be able to cater to various apparel and fashion needs of its customers.

“Although exploring new categories was anyway a part of the plan, the onset of the pandemic and the subsequent work-from-home setup accelerated our journey into expanding our product portfolio. Over the last year, we have expanded our product categories to include tees - both relaxed and more formal tees, party wear, and smart casuals. Given the positive response, we have seen for these, we will be first going bigger within these categories. Our product development is also highly centered on the needs of our customers. This, coupled with the exploration and experimentation, means we will definitely be looking at entering into more categories within a span of every 5-6 months,” Sharma asserted.

Clovia, too, entered into the personal care line by launching Clovia Botaniqa. The Clovia Botaniqa range comprises oils, body butter, face washes, face masks, shampoos, conditioners, and serums. Starting at Rs 399, the new range is curated for the needs of new moms.

Zivame, which is the leader in the lingerie segment, started offering products in categories like loungewear and home bras at the time of the pandemic. Apart from this, the brand is planning to expand its shapewear category. “We are also planning to enter adjacent categories like the personal care category,” Lavanya Pachisia, COO of Zivame added.

Future Prospect of Brand Extensions

Brand extensions work best when the power of your brand helps you in entering newer sub-categories and appeal to a newer customer segment. But this can’t be a universal approach and the way forward is more nuanced and is taken on a case-by-case basis. Sometimes, launching a sub-category within the brand works better, and some other times giving it a shape of an entirely different brand is more feasible.

Brand extensions are an excellent way to spread your business into new areas. However, a brand extension needs thorough planning and focus, like any significant change in your brand strategy. Brands have to make sure that their extension feels natural; otherwise, they could risk stretching their company out of shape.

There are multiple benefits of a well-planned and well-executed extension - reaching new customers, increasing revenue, creating hype, keeping existing ones intrigued and engaged, increasing the market share, and adding resilience to the business through diversification.

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