The deal, which sees the worlds largest luxury goods company joining forces with the worlds most famous diamond name to develop flagship stores is, according to the companies, expected to create long-term value for both groups and will become a catalyst for brand competition in the sale of diamond jewellery. The idea has attractions Links of London Jewellery . De Beers may not figure among the worlds leading brands but the name is associated with many famous diamonds such as the De Beers Millennium Star, the target of an unsuccessful robbery at Londons equally unsuccessful Millennium Dome in November.
The challenge facing De Beers is one which professional marketers will readily recognise - how easily will the De Beers name cross into luxury goods when, until now, it has been associated with a commodity? The test will be whether an industrial group that digs diamonds out of the ground can translate its name into something that means luxury U Charm, taste, class and style, as well as cost and quality.
The essence of the brand extension philosophy is quite simple; it means leveraging a brand by using the initial brand platform to move into other opportunities. This is a very attractive proposition for the owners of valuable brands links of london Bracelets. These add value to the bottom line - research by McKinsey & Co in 1999 suggested that strong brands generate total returns to shareholders that are 1.9 per cent above the industry average, while weaker brands lag behind the average by 3.1 per cent. So extending this profit potential to a new line of goods or services can appear to be an easy route to greater corporate wealth.
