Impact of Alignability and Size on Brand Lines and Line Extension Performance: Empirical Evidence

Few researchers have studied brand lines and line extension performance within a given category, although this constitutes the most common case. In this paper we analyze the impact of the interaction of line size (large vs. small) with line presentation (alignable vs. non-alignable) on brand line and line extension (a new product launched within a brand line) performance. We use a market-based metric (household panel data in the chocolate category over 3 years) instead of declarative data, which allows us to study true market conditions. We extend to the context of brand lines a finding made in relation to assortments: large lines perform better than smaller ones. However, we show that large lines (or lines sold in large stores) perform better when they are marketed using an alignable rather than a non-alignable attribute and vice versa. We demonstrate a similar effect in the case of a new product (line extension): new products launched within an alignable line perform better when the size of their line (or the store) is large and vice versa.