Product-Mix Strategies

PRODUCT MIX

What are some Major Product Mix Strategies?

PRODUCT MIX AND PRODUCT LINE

The product mix is the full list of all products offered for a sale by a company. A product mix has two dimensions: > Breadth (Width) - Different lines. > Depth - Assortment within a line. A product line is a broad group of products, intended for essentially similar uses and possessing reasonably similar physical characteristics.

BREADTH (DIFFERENT LINES) Lawn mowers Gardening tools Lawn furniture

Power rotary
Power reel Hand-powered

Rakes
Hoes

Chairs
Chaise lounges Benches

Shovels

Various sizes and prices in redwood or Each in various Each in various aluminum with sizes and prices sizes and prices plastic webbing

PRODUCT MIX ALTERNATIVES

DEPTH SHALLOW DEEP

NARROW

ONE M ODEL FOR EACH OF A FEW SIMILAR PRODUCT LINES

MANY M ODELS FOR EACH OF A FEW SIMILAR PRODUCT LINES

WIDTH
ONE M ODEL FOR EACH OF SEVERAL DIFFERENT PRODUCT LINES MANY M ODELS FOR EACH OF SEVERAL DIFFERENT PRODUCT LINES

WIDE

Detergents Toothpaste

Bar Soap Deodorants

Disposable Diapers

Coffee

Ivory Snow Gleem 1952 1930 Crest 1955 Dreft 1933 Tide 1946 Joy 1949 Cheer 1950 Oxydol 1952 Dash 1954 Cascade 1955 Duz 1956 Ivory Liquid 1957 Gain 1966 Dawn 1972 Era 1972 Bold 3 1976

Ivory 1879 Secret 1879 Camay Sure 1972 1927 Lava 1928 Kirk's 1930 Zest 1952 Safeguard 1963 Coast 1974

Pampers 1961 Folger's 1963 Luvs 1976 Instant Folger's 1963 High Point Instant 1975 Floger's Flaked Coffee 1977

MAJOR PRODUCT MIX STRATEGIES

Expansion of Product Mix > Breadth - Mix extension. > Depth - Line extension. Contraction of Product Mix > Breadth > Depth Alteration of Existing Products Positioning the Product > Position is the image that the product projects in relation to competitive products and to other products marketed by the company.

POSITIONING - ATTRIBUTE
Perceptual Map of Six Graduate Business Schools - Simple Space

Qualitative Curriculum Harvard Chicago Stanford Wharton

Prestige

Carnegie

Massachusetts Institute of Technology Quantitative curriculum

PRODUCT POSITION IN THE STATUS SYMBOL MARKET Long Life Luxury Home High Visibility

Summer Cottage

Low Visibility

Luxury Home Furnishings

Foreign Vacations Short Life

Luxury Car

PERCEPTUAL MAP - BRAND IMAGES

Lincoln Cadillac Has a Touch of Class a Car Id Be Proud to Own Distinctive Looking BMW Pontiac Porsche

Mercedes
Chrysler Buick Oldsmobile

Conservative Looking Appeals to Older People

Chevrolet
Ford Datsun Toyota Dodge VW

Has Spirited Performance Appeals to Young People Fun to Drive Sporty Looking

Plymouth

Very Practical Provides Good Gas Mileage Affordable

PRODUCT POSITIONING OF JEANS

High Price
Calvin Klein Sasson Jordache I1 (Status seeker) Lee Levi I2 (Dependable shopper)High

Low Status
Gap store brand I3 (Economizer)

Status

Low Price

PRODUCT SPACE FOR THE CHICAGO BEER MARKET

Light
8
5 9 2 7 3

Miller

B Lowpriced A

Hamms Schlitz

Highpriced

D
4 6

Budweiser

Heavy

COMPARISON OF POLISHES
10 8
Mothers McGuires Excalibur Eagle 1 NuFinish Turtle Wax Rain Dance Wax Shop IMAGE 10 Blue Coral Polish Zymol

6 4 2 0 4

10

Quality

TRADING UP AND TRADING DOWN

Trading up: Adding a higher-priced, prestige product to a line in the hope of increasing the sales of existing lower-priced products. Trading down: Adding a lower-priced item to a line of prestige products in the hopes that people who cannot afford the original product will want to buy the new one, because it carries some of the status of the higher-priced good. Problems > May confuse buyers > Sales are at the expense of older products > May permanently harm company reputation

PRODUCT DIFFERENTIATION AND MARKET SEGMENTATION

Product differentiation: Developing and promoting an awareness of differences between one company's product and those of competitors Market Segmentation: To develop different products each one suited to one or more segments of the market.