product line expansion strategy

Product line expansion refers to the existing product line to use the same brand, when to increase the product line of products, still use the original brand. The new products are often partial to improve existing products, such as adding new features, packaging, design and style, and so on. Usually manufacturers of these products will be marked on the packaging of different specifications, different features or different users. Expanded product line are many reasons for, such as to take full advantage of surplus production capacity; meet new consumer needs first to become a full product line for the company to fill the market gap, with the introduction of new competitors or competitive products In order to get more shelf position. Product line expansion of interests: the survival rate higher than the expansion of products of new products and new products are usually the failure rate of 80% to 90%; meet the needs of different market segments; complete product line can be competitors of defense Attacks. Product line expansion of the negative: it may lose its brand name to a particular significance. With the growing product line, will dilute the original brand identity and image, increase consumer awareness and choice of the difficulty sometimes because the original brand is too strong, causing confusion product line expansion, with sales volume insufficient to They offset the development and marketing costs if the consumer fails to distinguish between the eyes to a variety of products, will create a product line with the old and new products in the fratricidal situation.

Brand strategic decision

Brand strategy has five kinds of decision-making. Namely: product line expansion strategy, brand extension strategies, multi-brand strategy, the new brand strategy, brand strategy of cooperation.

Brand name decision-making

Brand name refers to the decision-making decisions all the products use one or several brands, or different products were using a different brand. On this issue, can generally have the following four types of decision-making mode:

1. Individual brand name. That is, the decision of each product using a different brand. Use of individual brand name for each product to a different market position and is conducive to increasing sales and confrontation competitors, it can also disperse risks, so that enterprises will not be because of the reputation of certain products affected by the poor performance. Such as "P & G" a washing powder company to use the "elimination of stains," "Bilang"; soap to use the "skin Shu-kai" the use of toothpaste, "Jia Jieshi."

2. All products use a common family of brand names. Which means that enterprises of all products using the same brand. For those who enjoy high reputation of the well-known enterprises, all brand name products adopt a unified strategy to take full advantage of its brand name effect, so that enterprises of all products sold. At the same time businesses on the cost of introducing new products is also relatively low cost, to new products enter the market. For example, the U.S. General Electric Company's GE products are used as a brand name.

3. The major categories of products using a different family of brand names. Enterprises to use this strategy, the general is to distinguish between different categories of products, a product category of products to use the common brand family, so in different product categories in the area of establishing their own brand image. Companies such as the swift production of a product category is the ham; There is also a major chemical fertilizers, were named "Puli Mu" and "high-fat Luo."

4. Individual brand name and corporate name and use. That is, the decision of its different types of products are taking a different brand name, brand name and before adding the names of enterprises. Such strategies of the enterprises for the development of new products. In the new products with brand names on the business name, so that new products can enjoy the reputation of enterprises, and a different brand name, will enable all kinds of new products show different characteristics. For example, Haier Group launched a "Pathfinder" color TV, "Hercules" Freezer, "Prince", "Little Prince" and "small child prodigy" washing machines.

Brand user decision-making

Brand user decision-making refers to the use of this decision enterprises (manufacturers) brand, distributor or the use of the brand, or the use of two brands at the same time. Under normal circumstances, the brand is the manufacturer's product tags, manufacturers decided to product design, quality and characteristics. Renowned manufacturers will be leased to other trademarks of their small and medium-sized manufacturers, will collect the royalties. In recent years, increasing the brand dealers. Western countries many prestigious department stores, supermarkets, clothing stores and so the use of their brands, some well-known businessmen (such as the United States of Wal-Mart) to Buy 90% of all goods with their own brand names. At the same time strong, there are many wholesalers in the use of their brands, enhance the pricing, availability and other aspects of control. At present, the dealer brand has become an important factor in brand competition. However, the use of distributors for the brand dealers will have some problems. Dealers required substantial orders, use up a lot of money, the larger the risk the same time distributors to expand their own brand's reputation, need to vigorously promote its brand, operating costs increase. Dealers use their own brand will bring many benefits, such as the purchase because of the large number of its purchase lower cost, thus selling prices lower, more competitive, can get higher profits. At the same time dealers can be used to control prices, to some extent can control other brokers. In a modern market economy, brand manufacturers and dealers often between the brand of fierce competition, the so-called brand warfare. In general, manufacturers and distributors brand of competition among brands, in essence, is the manufacturers and distributors of the trial of strength between the strength. Manufacturers in the market has a good reputation, has larger market share under the conditions, manufacturers should use the brand, unable to operate their own brand dealers can only accept brand manufacturers. On the contrary, when the brand in a market dealers in the area has a good reputation and a huge brand, improve the sales system, the use of brand dealers are also beneficial. So a brand user decision-making, in line with the specific situation and give full consideration to manufacturers and dealers in the balance of power in order to make an objective decision-making.