When To Extend a Product Line (And When Not To)


A product line is an array of related products under a specific brand. Such products are similar in terms of functionality, price range, target audience, or brand. Extending product lines is a business strategy that works best for established brands as they introduce additional items in a product category. 

Product line extension takes advantage of the values of an existing product in the market to introduce new choices to the customers. Consider product line extension as it can lead to a rise in sales, demand, and market share. Businesses are always striving to grow their reach and increase sales. Once they kick off the ground, they start seeking opportunities to expand and enhance brand equity.

To Extend or Not to Extend

Expanding a product line could bring in new businesses but can also hurt the brand. Therefore, you need to be keen when determining the right move for your company. The good news is that you do not need to own a large corporation to benefit from this kind of expansion. Having several product lines can allow your business to grow and establish a reputation. 

Product line extension can help your business attract buyers with different preferences, thereby increasing profitability. Product extensions such as introducing beer cooler koozie if you are in the drinks business can help you compete more broadly in your industry and can benefit your overall strategy. 

On the downside, as you push to diversify your products, you could experience overextension. Product overextension cannibalizes the older products’ sales and can use up your resources, especially with slow-moving products.  

Cannibalization impacts profits. When you introduce new products, the objective is always to get customers excited and encourage them to replace products with a newer model and act as a defensive response to competitors. But when a new product draws customers from your existing products, it may result in loss of market share and profits. 

To minimize such losses, you need to understand factors that may lead to cannibalization, its effect on existing products, and other organizational implications. 

The Pitfalls of Product Extension

Brand extensions have become quite popular in recent days. Through extensions, brands can evaluate opportunities in various product categories, identify resource requirements, and even lower chances of failure. 

However, product extensions also present several pitfalls if you choose to do them without proper strategies. 


When you extend a brand name too far, it may lose reliability, especially when extension happens in an unrelated market. To avoid such pitfalls, you need to critically analyze which product categories will work for your line of business and where you can comfortably use your brand name.

If your extension product is not that great, it can also spell trouble to the overall brand image. Currently, consumers want to do business whose brand is relatable; therefore, a negative brand image can lead to the failure of the business. 

While product line extension could mean the core brand lending awareness to the new product, it does not necessarily mean you do not have to invest in it. Failure to invest all your efforts in the new product could fail. Any new product indeed takes time to scale up, but failure to pump efforts into the new product could mean failure. 

On the other hand, if you invest too much to extend the product without expected return in mind could also be a recipe for downfall.


Innovation cannot happen without the labor behind the process. Extending your product line without considering the increase in labor and resources could significantly reduce profitability. If a new product outsells other products could also lead to lost opportunities that would have been beneficial to your business if you stick to a single development plan. 

Generally, many marketers assume that brand equity is a good idea and is enough for successful brand extensions. While it may carry some truth, customers will only buy a new product or service if it makes their lives easier, cheaper, better, and faster. 

A reputable brand name might reassure your customers that what you are offering comes from a serious company. Product stretching success is dependent on your ability to determine under what conditions you can stretch a product. 

The Dynamics of Product Line Extension

Customer demands keep fluctuating with every passing trend. Such behaviors may lead to unexpected stockouts, and this is why brands should consider expanding their product lines to drive sales and stay afloat. Brands should also consider expanding their product line and capitalize on the item’s momentum to optimize brand exposure by providing various options to fulfill customers’ preferences.