Final answer:
Many new products launched each year are line extensions, sharing similarities with existing products within a brand.
Step-by-step explanation:
The statement is true. Many of the so-called new products that are launched each year are indeed line extensions. Line extensions are new products that are added to an existing product line within a brand. They usually share the same brand name and have some similarities to the existing products.
For example, let's say a company already has a line of shampoo products. If they introduce a new variant of shampoo with a different fragrance or a specialized formula, it would be considered a line extension. This allows the company to capitalize on the existing brand recognition and customer loyalty.
Line extensions are commonly used as a strategy by companies to leverage their existing product lines and cater to different customer preferences without the need for significant investment in creating an entirely new product from scratch.