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Line Extension Overview and Examples

Nathan Mahr, Beth Loy
  • Author
    Nathan Mahr

    Nathan has taught English literature, business, social sciences, history, and writing for over five years. He has a B.A. in Comparative History of Ideas from the University of Washington.

  • Instructor
    Beth Loy

    Dr. Loy has a Ph.D. in Resource Economics; master's degrees in economics, human resources, and safety; and has taught masters and doctorate level courses in statistics, research methods, economics, and management.

Explore product line extensions. Learn the definition of line extension and find how it differs from brand extension. See examples of product line extensions. Updated: 05/03/2022

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What is Line Extension?

Line extension is a marketing strategy used to expand a product line. This can involve introducing new products that are variations of existing products, such as different flavors or sizes, or creating similar products that are related to the original product line in some way. For example, if a company already sells a popular bag of potato chips, it may decide to create different flavors or sizes of bags of potato chips. This often occurs when a company wants to capitalize on the success of a particular product by making it available in different forms. It is less risky than launching an entirely new product, as there is already some customer base and awareness for the brand.

There are several different types of line extensions that companies can use, including:

  1. Product extensions involve creating new products that are variations of existing products. For example, if a company already sells a popular candy bar, it may decide to create different flavors or sizes of that candy bar, to appeal to consumers who prefer different tastes or who want a different sized product.
  2. Service extensions involve providing new services that are related to the company's existing products or services. For example, a company that sells mattresses could also provide customers with expert advice on how to make their homes more comfortable and energy-efficient.
  3. Price extensions involve offering existing products at different price points to target different types of consumers. This can be particularly effective if the existing product is already seen as being high-quality and luxurious. For example, a company that sells designer handbags could introduce similar lines of handbags that are more affordable to appeal to a wider range of consumers.

Line extension can be a powerful marketing strategy, but it is often difficult to implement successfully. Some key considerations for marketers include:

  • The existing product line: Line extension should only be used if the existing product line is strong and has a good reputation. Otherwise, the new products may suffer from the same problems as the original products.
  • The brand equity of the existing products: If the existing products have a strong brand identity, then the new products should be consistent with this identity. Otherwise, there may be confusion among customers about what the brand stands for.
  • The target market: It is important to carefully consider the target market for the existing products and new products, and make sure that both segments are addressed effectively by line extension.

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Line Extension vs Brand Extension

As previously mentioned, line extension is when a company creates new products that are variations of existing products. For example, if a company makes a well-known cracker called Tasty Cracker and decides to make a strawberry-flavored Tasty Cracker. The company is making a slight change to the original product to give consumers more choice but it's the same cracker with a different flavor. Brand extension is when a company expands its brand to incorporate or create new products that are in entirely different categories than its existing products. For example, if a cookie company named YumYum Cookies decides to get into making ice cream, drinks, and bubble gum. YumYum Cookies is used to making cookies, but venturing into ice cream, drinks, and gum is new for the company.

The key difference between line extension and brand extension is that line extension typically involves creating new products that are variations of or closely related to their existing products. Whereas brand extension involves using an existing name or identity to launch a new product in a different category. Both strategies can be effective ways to expand and diversify a company's product portfolio, but they must be implemented carefully to maintain brand consistency and avoid alienating existing customers. When discussing line extension and brand extension, it is useful to explore the potential risks of these processes as well as when and why they happen.

When and Why They Happen:

  1. To target new markets or demographics: Consumer preferences and buying behaviors can change over time, and line extension can be used to tap into new market segments that were previously untapped by existing products. For example, Clorox's Green Works line was introduced in response to growing consumer interest in environmentally friendly products.
  2. To capitalize on trends: Line extension can also be used to capitalize on current trends in the market. For example, Pepsi's recent introduction of the 1893 line of craft sodas was a response to the growing popularity of artisanal beverages. It also took into consideration the increased consumer concern for ethical sourcing and sustainability.
  3. To follow competitors into new product categories: When a competitor enters a new product category, it can be difficult for companies to ignore this move and risk losing market share or losing customers altogether. Line extension can be used as a way to enter the competitive space without needing to create an entirely new brand.
  4. To diversify a company's existing product portfolio: Companies may also choose to use line extension as part of their overall strategy for diversifying their product portfolios, which can help them in times of economic uncertainty or when market conditions are unpredictable.
  5. To respond to environmental concerns: As consumers become more aware of environmental issues, they may seek out products that are more environmentally friendly. Line extension can be used as a way to address these concerns and position a company as being environmentally responsible.
  6. To refresh a company's existing product lineup: Over time, a company's existing product lineup may become stale and in need of refreshment. Line extension can be used as a way to introduce new products that are more appealing to modern consumers, while also supporting and strengthening the company's existing brand. For example, in recent years PepsiCo has introduced a variety of new products such as Quaker Oats breakfast bars and Gatorade protein shakes to refresh its existing lineup of soft drinks and snacks.

Ultimately, there are many different reasons why companies may choose to launch line extensions. The key is to carefully consider the needs of the target market and the overall objectives of the company before making a decision.

Risks and Challenges

There are several risks and challenges that companies face when launching line extensions. Some of the most common include the risk of diluting and overexposing the brand, the risk of cannibalization, and the need for careful planning.

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Frequently Asked Questions

What is an example of a line extension?

An example of a line extension is when a company makes a new product that is slightly different from an existing product. For instance, if a company that makes candy bars decides to make a new type of candy bar that is a different shape, size, or flavor from the existing candy bars, this would be an example of a line extension.

How is product line extended?

There are several different strategies that companies can use when extending their product lines, including making small variations in the ingredients, flavors, or other characteristics of their existing products. Additionally, they may also choose to create new products that utilize variations of size, price, or packaging from existing products.

What is line extension in brand strategy?

Within the context of brand strategy, line extension can help to increase a brand's awareness and equity by giving customers more opportunities to interact with the brand and become familiar with its products. Additionally, extending a brand's product line can also help to improve customer perception by giving customers more options and making the company seem more responsive and customer-focused.

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