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Line extension

Extending an existing brand names to new forms, colors, sizes, ingredients, or flavors of an existing product category is refer to Line extension. Thus, the Cheerios line of cereals includes Honey Nut, Frosted, Yogurt Burst, Multigrain, Banana Nut, Yogurt Burst, and several other variations.

A company might introduce line extensions as a low-cost, low risk way to introduce new products. Or it  might want to meet consumer desires for variety, use excess capacity, or simply command more shelf space from resellers. However, line extensions involve some risks. An overextended brand name might lose some of its specific meaning. Or heavily extended brands can cause consumer confusion or frustration.

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