WSJ is now selling bike jerseys. More than the design what is interesting is their decision to offer two versions at two different price points. Short sleeve at $98 and long sleeve at $119. This is an effective versioning strategy, recognizing that different customers have different needs and willingness to pay. They created two versions at two different price points to match the segment’s needs and capture value. If one price is good, two are better.
This type of versioning is what I describe as vertical product line extension. Another option for WSJ would’ve been to introduce multiple different designs (say with different “news stories on the jerseys”). That is horizontal versioning.
Marketing studies show customers’ willingness to pay varies along the vertical dimension and does not vary along the horizontal dimension.
What does it mean to a marketer?
Versioning can translate into multi-price points and higher profits only if the value to the customers varies across them. Simply creating multiple colors is not versioning. Each customer has different willingness to pay but a marketer cannot capitalize on that through horizontal versioning.