Branding and Expansion vs Contraction

I talk a lot about branding. As you know I've been doing extra reading on the subject, lately, to both expand and refresh what I've already learned. An interesting part of branding "law" is the concept of simplicity, aka contraction.

Because branding is very much an etherial practice, one that is intangible and only exists in the minds of human beings, it's hard to really define rules, but hey guidelines work pretty well too. That said, the guideline of contraction is one that really connects with our minds and perception more than it does our eyes (like color, for example) or even our sense of smell (cuz some people are trying to brand their stores via a scent, ask me how stupid that is and I'll tell ya). The idea is that when you have a product or service, it becomes known for something. It's not important what that something is, but for the sake of argument (as usual) let's say your company is Fossil and you make watches (I tweeted about this earlier tonight, btw, so it's totally appropriate).

Congrats, you're the CEO now
Okay, so you're the CEO of Fossil Incorporated and you're looking at your sales figures. Man, you sell a lot of watches, and you do pretty well in the watch business. Everybody knows your company makes a wide array of awesome watches, and those are pretty much the bulk of what you sell. But you want to get bigger, to expand your business and make more money, so you decide it would be a good idea to transform Fossil into more than just a watch company. You decide to make it a clothing and accessories company, meaning you'll make shirts, bags, backpacks, belts, wallets, sunglasses, so on and so forth. Kind of a cool boutique thing.
It sounds like a great idea to most people. After all, logic tells us that the more stuff we have to sell, the more potential we have to sell it. But when you've got a well-known brand, expanding your product line only dilutes your brand's strength.
If Fossil's brand as a hip watch company was at level exp85 in the RPG of business, introducing more line extensions weakens it down to exp 50. Extending your line only weakens what people know you for. Where people used to think Fossil=watches and would almost always seek out a Fossil store when they needed a watch, now people start having a more difficult time knowing what you stand for.

Jengaaaaaa!
Here's another analogy for you to chew on. Think of a brand as a tower of Jenga blocks. A good, simple brand is like having one Jenga block sitting on the table. It's stationary, it's solid, and it can't be knocked down. But then you start adding line extensions (aka other products and services) to your brand and the blocks begin stacking up. The more blocks on your little tower, the weaker the total structure is, and the more likely it is to fail. Make sense?
Keeping your brand simple might theoretically limit your ability to make money because all companies want to grow and get bigger, but enlargement simply equates to less brand strength and integrity.

When Line Extensions can be okay
It's easy to say "never do anything except what you started out doing" but that's not realistic. Most companies who want to grow do so in ways that don't make sense considering their core product or service, and that's the main problem. If a company like Fossil (again, shut up) didn't grow to include clothes and instead focused on watches, they'd do fine. But if they wanted to get a few more products and services out there, they ought to simply stick to watches and keep doing that well. Having more watches isn't going to hurt the brand, since everybody knows them for making watches. To be more precise, everybody knows Fossil to make cool watches for a mid-level price. They're not Rolex nor do they want to be, and they're not making those $10 Target watches either. They are hip and stylish, and appeal to a 20-something demographic who have a little bit of money to spend and like having nice stuff. Adding more mid-level watches to their repertoire would only serve to help them, not hinder them. It's the expansion into new territory that hurts.

The deviantART Scenario
DeviantART is good at one core thing: publishing art. People upload their artwork to deviantART and that's what it's known for. Nobody knows dA for its chat section, nor its forums, nor its groups feature. People know deviantART as the place to go to find and share art, and that is literally all. Everything else on dA doesn't need to be here to support the brand, but it's been added anyway. Not out of stupidity or anything, but rather to support the whole reason dA is a great place for art: the community aspect. Other sites that display art ignore the community aspect, thinking that the art will speak for itself and if it's good art it will draw crowds, but that's not been the case. The reality is that art requires a populace in order to be meaningful, and without people to appreciate the art it becomes meaningless. As such, deviantART succeeds at art publishing because it does everything in its power to make the community behind the art happier and healthier. Communication and collaboration are what a community of artists need, and that's what dA works at providing. The one thing I think we need to improve upon is how we display your art, but that's a whole project.

Now, how would dA hurt its brand? Well, if dA decided it wanted to also include music, that would be outside the norm. DeviantART is know for visual art, and including music would confuse people. Although you can argue that music is art (and it is), people think of music as a whole other universe. When people say "art" you think of things you look at, when people say "music" you think of things you listen to. They're worlds apart, psychologically.

So generally speaking, dA is doing pretty well in the branding department by focusing on its core competency. So long as it doesn't branch off into another direction, and continues to try to improve upon what it does best, it will continue to thrive.

How to Expand Better
Going back to the beginning, if you're running a company with a strong brand around it and want to grow, how do you do that without making more shit to sell? A better way is to get customers who are of the proper demographic you're trying to hit and get them in a geographical area you've not yet hit. For example, if you do a great job of selling your product to people of the United States, try also selling it to people in Canada. If you've done that, see if people in Mexico like it as well. Expanding geographically doesn't hurt a brand at all, it simply gets new people involved in the brand and actually helps strengthen it.

In deviantART's case, we could probably do better expanding the brand geographically into new areas, but I think we're still trying to solidify our brand in the Western civilizations (North America/Europe). We ought to do that first.

Hopefully that all makes sense. I think I've gotta go hit the hay now before I am too tired to keep bothering you with branding diatribes.