Amazon’s recent drive into the video streaming market may well succeed, but it could also carry some risk for its brand.

In its negotiations for our attention as consumers, Amazon has developed a great sense of “authority”. This is an acknowledged source of bargaining power, as we are all more likely to trust entities which exude authority, and that authority is reinforced by the social conformity which leads more and more of us to trust it. All great brands have this pedigree of authority – from Apple to Harrods. It is wrapped up in a combination of reliability and expertise. This creates a conundrum for such brands though – how to extend such authority into other areas of business where that authority does not yet exist.

Brands are often keen to diversify – but can they carry their authority into new areas? If not then new ventures may fail and this may in turn affect the core brand itself – with harmful effects for the “deal” by which they obtained consumers’ attention in the first place. Virgin is a good example – it has been successful in turning its mixture of refreshing exuberance into an airline brand – less successful when it comes to Cola and cosmetics and trains – and maybe those uneven attempts at diversity have weakened our perceptions of what Virgin stands for, so that we are less likely to sit up and pay attention when Virgin negotiates for our attention as consumers.

For Amazon, video-streaming is an interesting extension of its core brand. It is peerless in the world of e-commerce books, and has extended that brand to book downloads and latterly music downloads. Is video streaming proximate enough to what it stands for that we as consumers will still assume that Amazon has “authority” in this area? If not, it will still have massive scale (another source of bargaining power) but it will have less bargaining power than it normally does, with which to negotiate for our attention…