As the name implies, a chord substitution involves using a chord in place of another. However, it is not just any chord as usually the substitute chord replaces the original one in respect to its function in a given harmonic context.
The reasons to do this may vary but the general intent is to add more harmonic interest to a chord progression. A substitute chord is only so provided that it shares common chord pitches with the chord that is going to be replaced, and that it can support the melody. Again, the requisite of having to share common chord pitches ensures that the substitute chord maintains the same harmonic function in a given harmonic context.
There are different ways in which you can swap a chord for another. This first example is called a diatonic substitution because we are not changing any notes of the scale to come up with a different chord than the ones you would normally get from that tonality or harmonic field.
In other words, it is when the new chord belongs to the same key as the original chord. The following tables show two kinds of chord substitutions according to their relative minor or secondary relative minor:
The shown substitutions are relative, meaning that the submediant and mediant relationship occur with any other chord on a given scale
In the above score you can see that either Am7 or Em7 share three common tones with C∆ and thus are ideal candidates to replace one another. Because they will not “sacrifice the melody” and share a similar chord construction, the harmonic function is maintained but with a different flavour.
In this case, the substitution chord also supports the melody although it originates from a different harmonic field. Since it belongs to another key or tonality, it introduces chromatic changes to the scale from which the original melody belongs to and thus adds even more variety to harmonic and melodic context:
Mind you that the melody is unchanged and only the chord introduces the chromatic tonesFmaj7 to D7add13
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