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Following are the factors that can influence the decision regarding the use of a brand extension as a growth strategy:

1. Brand reputation is one of the factors that can influence the decision of the company on whether to use a brand extension. It is important to consider how the brand is viewed by the people in the market. When the brand has a favorable reputation, it means that the people trust the brand and feel good about buying the brand's products or services.

2.Consumer Innovativenesscan also influence the decision of the company regarding the use of the brand extension. The desire or the willingness of the consumer to accept or try new products and experiences is important to consider by the company. If a company's target market consists of people who like to try new products and ideas, it is favorable for the company to proceed with the brand extension. The company can introduce a new product category or may introduce a new item in the existing product category. Since people are willing to accept new ideas and products, the new extension of the company is likely to have a desirable result.

3. The financial health of the company is another factor to be considered when deciding about brand extension. If the company decides to use a brand extension whether a line extension or a category extension as a growth strategy, it has to spend a considerable amount of money on the same.