But this is not always the case: you just have to find the balance. To have multiple options available to them when they shop. In the TED talk on “the paradox of choice” (subtitles available in Spanish), Barry Schwartz describes how people who are given a basic set of options tend to make decisions more quickly when faced with a wide set of options. Consumers with limited options tend to end up more satisfied with their decisions than those with infinite options. Line extensions can be beneficial for a brand, but don’t offer too many options. Make sure the extensions you plan to create are based on audience research and trends, and align with what people really want. Extensions are a quick, low-cost way to increase sales in the short term. A company with an established production process and the ability to produce new products means a lower initial investment.
In many markets, the development of product line extensions is a competitive reality. As product categories evolve, a company must continually adapt its product lines. Bruce GS Hardie and Lenoard M. Lodish for Harvard Business Review. It’s a strategy that has worked for Bushbalm, an online skincare retailer. “We have seen massive changes to our business through horizontal and vertical expansions,” explains CEO David Gaylord. “Selling a new product in a category has driven average order value (AOV) up. And the new lines have helped us reach entirely new audiences to target the growing Total Addressable Market (TAM).” Expanding a product line can increase sales, demand, and market share. Because extensions increase the number of products available in the marketplace, they keep people engaged and can help prevent churn.
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And brand extension Brand line extension occurs when Russia phone number a company introduces a new item in an entirely different product category. It allows a company the opportunity to expand its brand with recognition of its existing products. For example, why do you immediately know the Jack Daniel’s brand? If you answered that because of the whiskey, you are correct. But Jack Daniel’s also sells other products in the food and beverage industry, including barbecue sauce, praline nuts, and even coffee. Jack Daniel’s brand extension The brand also offers a line of frozen products, under the name Jack Daniel’s Meats. The fact that Jack Daniel’s uses its brand recognition to sell products outside of the alcohol sector is an example of brand extension. When done correctly, the products of a brand extension initiative can be more easily accepted due to the popularity of existing ones.
An example of line expansion for Jack Daniel’s would be the creation of a new whiskey flavor. As you can see in the photo below, Jack Daniel’s offers several different flavors of their main product. The original version is Jack Daniel’s Old No. 7 . Variants are all other developed whiskey types, including Tennessee Apple, Gentleman Jack, Winter Jack, and even Can Cocktails. In general, a brand extension involves the expansion of the company into new product categories where it is less well known. A line extension is when the brand creates a variation of an existing product to target new customer segments. Examples of product line expansion Now that you have an idea of what line extensions are, let’s look at two real life examples. » Bushbalm Skin care provider Bushbalm has an extensive line of products that has been expanding over time.
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The brand originally focused on making ingrown hair prevention products. Including oils and scrubs for skin irritation. After identifying a market need for dark spot treatment, it horizontally expanded its product line into that category. Horizontal extent of Bushbalm’s line In each category, Bushbalm also sells high-end and low-end products, which means selling products of different quality and price. If you shop at the brand’s online store, you can pick up an affordable brush or mid-priced scrub to treat skin irritations. Buyers with a bit more budget can opt for a more expensive oil, which is a more luxurious option. The lesson here is that upgrades don’t have to be a huge project. Many of the examples you’ll see of line extensions and product mix are related to big brands like Toyota or Colgate.
Coca Cola Throughout its more than 130 years of existence, Coca-Cola has released its fair share of product line extensions. If you look at any grocery store shelf, you will see a few different flavors and styles of Coca-Cola, such as Coca-Cola Life, Coca-Cola Zero Sugar, Coca-Cola Vanilla, etc. The best-known example of a line extension was the launch of Diet Coke in 1982. It was used to target the growing weight- and calorie-conscious market. Diet Coke still exists today. Since then, it has expanded the product by introducing new flavors, such as Ginger Lime and Feisty Cherry, to appeal to millennial consumers. Coca Cola Coca-Cola’s products are similar, but they differ in that they target different audiences. This gives the global brand the opportunity to take more market share and increase the sales of the corporation. Tips for Creating a Product Line Expansion Strategy.