Everyone assumes they know what their brand is selling: soap, pens, dolls or another straightforward product. But if you want to move your brand into a new product category, you need to take a closer look at the real business of your brand. It’s the only way to identify successful long-term brand extensions.

In this case, “business” means the dimension of your brand that people recognize. It’s the strategic advantage that makes consumers reach for your product over the ones sitting next to it on store shelves. We call this dimension a brand’s extendable equity, and you can’t launch a successful brand extension without knowing what it is.

You need to identify your brand’s one extendable equity to set yourself apart from the brands already dominating the category you want to move into. But figuring out what business you’re really in isn’t as simple as it sounds. Just consider a few famous brands:

Is Barbie in the doll business? Or the fashion business? Barbie, whether prom queen, airline pilot, astronaut or girl reporter, always looks great. This is why girls love Barbie. She is the original fashionista. Barbie is training wheels for Chanel. And fashion is her extendable equity.

Is BIC in the writing instrument or stationery business? Or is its extendable equity disposability? BIC makes pens, but the brand doesn’t necessarily have a strategic advantage in the broader category of stationery and office supplies. So instead of launching staplers or printer paper, the brand moved into the razor aisle, where consumers value disposability.

Is Better Homes and Gardens in the magazine business? Or does it represent a love for home? The 100-year-old magazine brand has built a billion dollar business in home décor, because it identified the number one motivation for decorating: Love of family and friends. For a line of home products at Walmart, the brand celebrated this extendable equity with a tagline that celebrates the brand’s emotional core: Fall in love with your home all over again!

Your brand houses many dimensions, and each one represents a unique strategic possibility. These dimensions might include a service, attribute, expertise, benefit or ingredient, and your extendable equity might relate to any one of those dimensions.

Do you know the real business of your brand?

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10 Ways to Extend Your Brand