Roger asked in Business & FinanceCorporations · 10 months ago

Why do companies come out with cheaper models of thier product and put a different name on it? Why not just sell your main brand cheaper?

Update:

Appliance companies do this all the time. Tire companies too. Goodyear has off brands. Whirlpool has off brands. Etc

Update 2:

So like I said why not just sell the main brand at a cheaper cost

7 Answers

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  • ?
    Lv 7
    10 months ago
    Favourite answer

    That's the worm wiggling on the hook that grabs your attention. Not everyone can afford the top end products so companies have their "draws" or less expensive items that draw you in and then they have their star attraction available too if you can afford it.

  • 9 months ago

    People might be willing to pay $30k for a toyota. But not as many are willing to pay $80k for a toyota. Enter, Lexus. All about perception.

  • It is to create products for different audience. Selling the main brand cheaper means to affect the branding of the company image on the whole and will affect the reputation in the long run

  • Anonymous
    10 months ago

    They sell the expensive line to people who are willing to pay the extra money and the others to people who don't want to pay so much.  Maximizing revenue.

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  • 10 months ago

    Marketing, hitting multiple price points increases market share.

  • 10 months ago

    The idea is to maximize profit. Someone may not need all the bells and whistles of the "main brand". Hence the Ford F150, 250, 350 . . . . 

  • 10 months ago

    Because the point of it all is to make money.  If somebody is willing to pay more for your brand name, why wouldn't you let them?

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