Jul 4, 20201 min read

Brand Cannibalization

Ever wondered why Apple isn’t afraid to announce a new iPhone even when the craze of the earlier version hasn’t dried up?

How can growth ever be degrading for Starbucks ?

Courtesy: 𝘽𝙧𝙖𝙣𝙙 𝘾𝙖𝙣𝙣𝙞𝙗𝙖𝙡𝙞𝙨𝙖𝙩𝙞𝙤𝙣

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 “eats” up the sales and demand for an old popular product, hence cannibalization.

𝙎𝙩𝙚𝙫𝙚 𝙅𝙤𝙗𝙨 𝙨𝙖𝙞𝙙, "𝙄𝙛 𝙮𝙤𝙪 𝙙𝙤𝙣'𝙩 𝙘𝙖𝙣𝙣𝙞𝙗𝙖𝙡𝙞𝙯𝙚 𝙮𝙤𝙪𝙧𝙨𝙚𝙡𝙛, 𝙨𝙤𝙢𝙚𝙤𝙣𝙚 𝙚𝙡𝙨𝙚 𝙬𝙞𝙡𝙡"

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 competitors’ current customers, hence increasing its client base.