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Brand Cannibalization

Ever wondered why Apple isnโ€™t afraid to announce a new iPhone even when the craze of the earlier version hasnโ€™t dried up?

How can growth ever be degrading for Starbucks ?

Courtesy: ๐˜ฝ๐™ง๐™–๐™ฃ๐™™ ๐˜พ๐™–๐™ฃ๐™ฃ๐™ž๐™—๐™–๐™ก๐™ž๐™จ๐™–๐™ฉ๐™ž๐™ค๐™ฃ

It is a process of creating different sub-brands or new products of the parent brand so that it can grow its customer base by targeting large numbers of customers.

Does it really work well?

Well sometimes, after launching a new product, it โ€œeatsโ€ up the sales and demand for an old popular product, hence cannibalization.

๐™Ž๐™ฉ๐™š๐™ซ๐™š ๐™…๐™ค๐™—๐™จ ๐™จ๐™–๐™ž๐™™, "๐™„๐™› ๐™ฎ๐™ค๐™ช ๐™™๐™ค๐™ฃ'๐™ฉ ๐™˜๐™–๐™ฃ๐™ฃ๐™ž๐™—๐™–๐™ก๐™ž๐™ฏ๐™š ๐™ฎ๐™ค๐™ช๐™ง๐™จ๐™š๐™ก๐™›, ๐™จ๐™ค๐™ข๐™š๐™ค๐™ฃ๐™š ๐™š๐™ก๐™จ๐™š ๐™ฌ๐™ž๐™ก๐™ก"

So, whenever Apple invents a new iPhone, it ensures that the version is available in all their chain stores.

Even If it causes the older version #sales to decline, Apple makes up for this loss by capturing its competitorsโ€™ current customers, hence increasing its client base.

Companies often risk market cannibalization is hopes of gaining a bounce in overall market share.

Author: Vasudha Khera

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