Software reuse is a key enabler for producing successful software intensive consumer products. Initially, just adopting reuse was enough to achieve competitive advantage; today an efficiently running product line is almost expected for any organization producing widely varying, software intensive consumer products. The major source for competitive advantage has shifted to product line management, and especially an organization’s ability to optimize the alignment of its product line development approach with its competitive strategy. In this paper, we explore ways to match product line development for an organization pursuing differentiation strategy. In this context, the success of the product line is determined by the success of the resulting products, their ability to gain differentiation against the competition as well as within the product portfolio. If all products appear too similar to each other, market segmentation fails. In this paper, we first discuss the problems hounding real industrial product lines. All the experiences are based on experiences gathered being closely involved with more than ten operating product lines and observing multiple failures in being able to realize true benefits of reuse. Then we show how a product line organization can be tuned so that the benefits of reuse are attainable while supporting significantly varying set of products. Finally, we give examples of product lines that have evolved into the direction suggested by us.