Firms are using brand extensions (for example: Ferrari) to decrease the cost of launching a product into a new market. That cost has risen enormously the last few years. By connecting the new product to a well-known brand name, companies can reduce the financial risk of introducing a product in a new market by providing consumers the familiarity of and knowledge about an established brand. 
According to studies of a marketing company there is a positive link between high quality of the original brand and the interest of the consumer in the new product. Their attitude against the brand extension was also positive when the extension was not regarded as too easy to make. These findings show us that more and more companies will use brand extensions because it's an easy and less expensive way to enter a product in a new market. Melanie Ciers
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