Strategic Marketing Exam 1 Practice

The idea being tested is how a company expands its offerings while using its existing brand. A line extension adds new items within the same product category under the same brand name—think adding a new flavor or variant of the same product. A brand extension uses the same brand name to enter an entirely different product category, leveraging the brand’s reputation to attract consumers to a new type of product. So the best choice says that line extension adds new items within the same product category, while brand extension uses the brand to enter a different product category. For example, a toothpaste brand launching a new toothpaste variant is a line extension, whereas using the toothpaste brand to introduce a toothbrush under the same brand is a brand extension. The other ideas don’t fit because using a different brand name would be starting a new brand rather than extending the existing one, and adding flavors to the same product line is a line extension, not a brand extension.