Why Brands Should Typically NOT use Line Extensions to Expand Their Business

Happy #BrandTipTuesday everyone!

One key concept for building a successful brand or business is that a majority of the time, brands or businesses should not use LINE EXTENSIONS to expand their business or increase revenue.

So many companies make the common mistake of trying to expand their business and brand through line extensions. One reason 90% of all new brands are line extensions from core brands is management measures only the success of the line extension and not the EROSION OF THE CORE BRAND!

Two of my favorite quotes from two world-renowned #marketingstrategists Al and Laura Ries are the following;

“When Coors was going to release “Coors Light” we asked where the market for Coors Light drinkers was going to come from and they said from Bud Light and Miller Light drinkers/market...When Miller was introducing Miller Light the targets were Coors and Budweiser.

"Maybe this concept is too complicated for the average CEO to understand but isn’t the Coors Light drinker more likely to come from Coors? And the Bud Light drinker from Bud Weiser and the Miller Light drinker from Miller High Life?”

What a quote! Now you know a #brandingconcept that even some CEO’s do not understand! When it comes to #consumers and #brands people may want a beer with a lot fewer calories than their usual choice but there is no such thing as a “Light Beer” drinker who has no preference on what brand of light beer.

There is NOT a “diet soda” drinker that does not have a preference for either Diet Coke or Diet Pepsi but there is a Coca-Cola person and a Coors drinker whether it is Light or not they prefer Coors anything over a Bud Light!

The psychology behind this concept is that when a consumer grows to trust a brand and support it they are less likely to go and try a new variety of competing brands with who they have not established any sort of relationship.

So when businesses release line extensions like a “light” variety it undermines their original #brand and immediately gives your original brand a negative appearance. If the new one is the “light” version that must mean that their original version was full of calories, unhealthy, and “heavy”?!

This is why it is so important to not use line extensions that are not in line with your original brand and product! Next week for Brand Tip Tuesday we will go over another key branding concept so make sure to subscribe to the blog and follow us on Instagram!

Let us know in the comments if you are a Coca-Cola person or a Pepsi person...