Back in school, in marketing 101 class (or maybe it was 202 or 303) we learned about brand extension: a TV brand like Oprah Winfrey, launches a magazine, to extend the TV show success. Other known examples are CAT, extending its tractor brand to “worker like” fashion. Successful brand extensions are the ones that makes sense to the consumer: CAT has a “hardy” and outdoors image: if you are this type of person, or want to look like this kind of person, you will buy their shoes.

The ones that failed are the ones that didn’t make sense: Zippo for example, is a “manly” lighter. Their attempt to extend their brand to perfumes was not a huge win.

Why do I write about brand extensions? Because SnapChat just came up with a payment system, which in any marketing term, is a brand extension. If you follow the logic above, you can assume it will fail. SnapChat is known as a tool for sending indecent photos, not a reliable and trusted payment network. It is not perceived as “serious” enough to handle money and while some will try using it, I find it hard to believe it will become a significant business.

Time will tell if I am wrong or right, but the odds are against this brand extension.

UPDATE:

Pando is bringing up an interesting point and a use case: snapcash for porn. People (mainly young people) might exchange nude pictures for cash. As disgusting as it sounds, this is a perfectly reasonable brand extension and a way to monetize the service.