KusmiMist Market Extension Report

Market extension investment report

Executive Summary

Market extension is an a possibility every company should look at. It represents an opportunity to widen and improve sales as a way to develop better image and visibility. When a company can ensure its own market is well-developed, market extension seems to be a profitable evolve to make the company grow and improve its profits. However, such a decision requires a stable structure as a reliable consumers community, that is why building a new market branch can also lead to failure and important costs.

Currently the companies have developed enough markets and structures to invest in extension, and requires innovative ideas to improve sales and visibility. I have been asked to investigate the pros and cons of such a decision. My research aims to highlight which companies might represent a sustainable and profitable opportunity to invest in.

Introduction

The report will focus on :

1- The companies structure and image

2- The brands extensions propositions

3- The perks of these potential developments

Companies Structures and Image

Two different companies possible extensions seem to represent profitable opportunities. Both Tissot and KusmiTea have suggested a market extension to perfume market and their product development have raised interesting assets for investors.

A- Tissot, a Swiss Watch company, has developed a strong and reliable brand and image worldwide as a middle class but luxurious market.

B- KusmiTea is knowing an important spreading through the world and its community seems to grow constantly as it relies on tea consumers, a promising market thanks to tea culture expansion.

Brand Extensions and Products

A- Tissot aims to create a business woman perfume for well-off people. As the company has not developed its woman watch line as its men line, creating a women perfume line might represent a profitable opportunity as the company is already well-known. This extension would reach both woman market and perfume market at the same time.

B- KusmiTea wants to rely on its existing community to develop seasonal fragrances related to its own tea flavors. This proposition is interesting in the way the target is already reached, but does not extend its community and cannot ensure a perfume market as wide as its tea market.

Opportunities and Threats

A- The high price of Tissot’s Timeless perfume could ensure a promising investment in order to increase profits in case of good popularity. Still, the target is quite narrow and could lead to a market failure.

B- The widen line of KusmiMist and its important consumer community could be interesting points to develop a reliable product line in a short term. However, the development and production of four different product could lead to a risky situation.

Conclusion

This study highly recommends investors to rely on KusmiTea’s extension, KusmiMist, as its well-developed community and image provides a promising starting market for such a lien extension. Furthermore, the production of a four-products line would ensure a minimal popularity and a better consumer analysis in a short term. Even though KusmiMist price is much cheaper than Tissot’s Timeless, the expensive production of Tissot’s product and its narrow target could lead to failure more than KusmiTea’s extension. KusmiMist would represent a promising opportunity in a short-term and easy to develop at larger scale and time.

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