Which of the following is an example of a brand extension?

A brand extension occurs when a company takes an existing brand and uses it to launch a new product in a different category. This strategy leverages the brand's established reputation and consumer loyalty to help the new product succeed.

In this context, Apple introducing the iPhone is a clear example of brand extension. The iPhone represented Apple's entry into a new market segment—the smartphone market—building on its already successful brand known for technology and innovation, previously associated with computers and music players like the iPod. By using the Apple brand for a product in a different category, the company was able to tap into its existing customer base and brand equity, making the iPhone a successful product launch.

The other options involve either product line extensions or improvements within the same category. For instance, Pepsi launching a new soda flavor is simply an expansion of a flavor within their existing beverage line, not venturing into a different category. Gatorade adding a new sport drink flavor is also a variation within its established product category. Coca-Cola improving their packaging focuses on enhancing aesthetics or usability of their existing product and does not involve a new product category at all.