Nowadays, brand is one of the most valuable intangible assets of a company. A brand can be defined as a product or service that differs in characteristics from other products or services in order to meet the same consumer need. But the goal of this paper is not just to study brands as a concept, the goal is to understand the origin and development of brands. It is very important to understand the different approaches to brand development in order to implement the right strategy for a particular company. One of the most successful strategies for introducing new products to the market is the brand extension strategy. The aim of this paper is to understand why so many companies opt for this strategy. A brand extension can be defined as the name of an existing successful brand that extends into a new or related product category. Different companies use different methods to extend the brand. There are two methods, vertical and horizontal extension. However, every company should be careful when making a decision to extend a brand, despite the fact that there are many successful extensions, unsuccessful extensions should also be considered as this can be fatal for the company and its survival. Brand extensions can have a positive or a negative impact on a parent brand. The most successful brand extensions are most often closely related to the parent brand. This paper studies HiPP as an example of a brand extension, its image and other factors that influenced its successful extensions. The survey results also point to HiPP’s good business and consumer satisfaction with the brand.