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Cannibalization
Term category: General Business
In 10 words or less: The negative impacts a business decision may have on a company's existing business.

Definition: Cannibalization refers to the negative results a company's existing business sees as the result of a new business decision.

 Advice: Cannibalization is usually talked about when referring to new product launches.  If a company launches a new product that is too similar to an existing product, sales for the existing product may slump as its customers switch to the new product.

Brand companies have to be particularly careful not to cannibalize their existing brands when creating full, brand portfolios.

 

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