What is a Product Mix Strategy?
An effective product mix strategy allows a firm to concentrate its efforts and resources on the items and product lines that have the most potential for growth, market share, and revenue within its offers.
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A product mix strategy has four dimensions:
| Width | A total number of product lines that a company offers. |
| Length | A total number of products in a company’s product mix. |
| Depth | A total number of product variations in a product line. |
| Consistency | Indicates how product lines can relate to one another |
Key Product Mix Strategies
There are four key product mix strategies:
1. Expansion: A business expands the number of product lines it offers or the depth (i.e., product varieties) within those lines.
2. Contraction: A company’s product mix is narrowed to eliminate underperforming items or lines while also simplifying the remaining products or lines.
3. Change an Existing Product: A company improves a current product rather than creating a completely new product.
4. Product Differentiation: A corporation offers a product as a superior option to a competitor’s offering without changing it in any way.
Additional product mix strategies include
Deepening Depth: A company keeps existing lines but expands them.
Developing New Uses for Existing Products: A company finds and communicates new uses for current products without disturbing lines or products.
Trading Up: A company adds a higher-cost product to an existing line to improve brand image and increase demand for its lower-cost products.
Trading Down: A company adds a lower-cost product to an existing line of higher-cost products.
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