US snacks and beverage maker PepsiCo has inked a licensing deal with local licensing firm DVB Brands. As part of the deal DVB Brands is launching lifestyle-based sports footwear in the country. The brand extension has surprised industry experts.
The move is driven by PepsiCo globally, and not the Indian firm, Economic Times has reported.
“Our iconic brands have enabled us to provide consumers with new ways to engage with PepsiCo – whether it be in a can or apparel or accessories. We are creating new opportunities for consumers to engage with our brands across multiple touch points and with strong partnerships with brands including Zara, H&M and Fila,” ET has reported PepsiCo senior VP, Global Beverage Group, Kristin Patrick as saying.
Industry experts say while licensing is a legitimate way to enter new businesses, the extension of a cola or food brand into shoes will not work, and will damage the core brand while revenues from the extension could be minimal.
Branding strategy consultant Harish Bijoor told ET: “Stretching a brand too thin beyond its obvious synergy doesn’t work. There are enough examples, both locally and internationally, to prove that when a brand moves beyond its core, consumers reject it.”
DVB Brands chief executive Chandni Batra said: “The footwear range is directly youth-focused, which is the core of Pepsi.” She said the product range will be available at e-commerce sites such as Myntra.
In the past, PepsiCo has done licensing deals with mobile phones in markets like China, and the extension backfired.