customers, yielding weak line logic. They lower brand loyalty by inviting customers to try "something different" from what they have been using all along, which is the real definition of brand loyalty. Managers may actually harm a potentially profitable idea by thinking short-term risk management instead of long-term capacity. Line extensions fail to increase demand; you are not encouraging more frequent use of the product, instead you are dispersing the consumer over the entire category. When customers are not able to make sense of the product and are unclear about its benefits, it tends not to sell. Retailers do not have shelf space to spare for slow-moving products. Often times extensions are underexploited product ideas and they may give a competitor the opportunity to develop his or her own strategy. On top of it all, they tend to carry with them hidden costs including poorly focused application, production complexities, logistics complexities, higher supplier costs, and deviation from research and development of new products. In illustration of how to create a profitable, workable market strategy, the authors use a snack foods company, "Snacko". An "action agenda" is proposed in an attempt to harmonize the conflicting motives. Improve cost accounting; understand and evaluate the absolute and incremental costs associated with production and distribution. Balance support to benefit winners; try to stay away from favoring core brands. Research consumer behavior; you want to learn how the customer perceives and uses each item. Apply a line logic test; make sure that your salespeople are able to state a strategic role for each item in the product line. Coordinate marketing efforts across the line; in an effort to be more clear and convincing, price your brand consistently. Work with channel partners; develop teams within the firm so that you can work efficiently at producing a winning product. Expect product line turnov...
