Modeling the Factors Influencing Successful Brand Extension Strategy in FMCG through Qualitative approach and Grounded Theory

Because of the cost of introducing new products, and increased competition, many companies try to reduce their risk by using existing brand names, a strategy that called brand extension. While there are successful stories in applying brand extension strategy, the results are mixed. So, this study is to identify factors that affect the success of the strategy, especially in FMCG market in Iran and help companies targeting this method for launching their new products.
The statistical population of the study is FMCG companies, which operate in Tehran Province. While using qualitative approach and grounded theory, the study uses a non-probability sampling and gathered data through in-depth interviews with22 brand managers and owners in the industry. And after implementing coding process, eight factors, (Quality; Attitude toward brand; Consumer`s characteristics; Availability; Marketing efforts; Parent brand`s category features; Parent brand`s features; and Fit) were identified as effective variables in introducing this method in Iran’s market influences the acceptance of brand extensions in FMCG in Iran's market.