Croma, a TATA enterprise, is offering a treat for Diwali by starting a sweets venture. The question is, why is a home appliances brand sending mithais?
Brand extensions are a common strategy for companies looking to expand their product offerings and diversify their revenue streams. The diversifications usually involve related products or services that complement the company's core offerings.
For example, Amul, initially known for dairy products, has diversified into ice cream, chocolate, and other packaged foods. Similarly Dabur, primarily known for its ayurvedic healthcare products, has ventured into categories like fruit juices (Real), skincare (Fem) and hair care (Vatika).
These extensions make sense, as they leverage the brand's existing expertise and customer base. However, Croma, an electronics brand, has surprised many by making a foray into the world of sweets. The move seems, at first glance, like a leap into an entirely unrelated domain.
Croma has decided to start a new venture- Uphaar, bringing out sweet varieties like motichoor laddo, kaju katli and soan papdi for the festive season. To accompany this transition, the brand has initiated a campaign where audience can register on the website and get a chance to receive free samples at home.
This unexpected brand extension has raised eyebrows over the internet. A user on LinkedIn wrote, “Why is Tata extending its 'Croma' brand, hitherto strongly associated with white goods retail, to sweets/mithai, of all things?!!” while another assumes it to be a strategic move by the brand to leverage established trust and reach in diversifying their portfolio.
A humorous comment even suggests that the sweets will come with a 2 year warranty and 1 year extended warranty, in line with other Croma products.
Though this new territory is very unlikely a brand extension, it speaks about a new trend. Earlier this year, Jaquar, a brand synonymous with bathrooms, entered a completely new line. It released an advertisement to introduce lighting solutions. The ad looked unusual in similarity with the brand's diversification.
Experts on the internet say that the concept is unlikely to succeed, people would prefer trusted brands of their 'niche' like Haldiram's and Bikanervala over an electronics brand stating to combine traditions and innovations for sweets.
Tata is already running food brands, both offline (Star Bazaar) and online (Big Basket). This out of the box move may redefine the boundaries of brand expansion in the future or in its absurdity, communicate how brands should ally to their specific categories.