Valuation of brand line extension effectiveness: Ubisoft flagship brand Assassin’s Creed case

Abstract

Goal: to value the effectiveness of brand line extension strategy on an example of Ubisoft brand Assassin’s Creed. Objectives: 1. Analyze the brand line extension strategy with the prerequisites for the successful application of the strategy and possible errors in implementations. 2. Analyze the video game industry in order to find specifics applied for the market and operating companies. 3. Investigate methodologies for valuation of the effectiveness of brand line extension and their applicability. 4. Apply real option analysis for the Assassin’s Creed Black Flag project. 5. Analyze the effectiveness of brand line extension strategy on the results obtained. Main results: The real option analysis is chosen as the most applicable methodology for the valuation according to the video game industry specific and peculiarities implied in IT projects .The empirical results provide evidence that despite the anticipated profitability of the Assassin’s Creed brand line extension further application of this strategy for this game series will provide decreasing return and it is better to direct investment on creation of new game brands to replace long existing projects.