Unfortunately, new product development is an extremely challenging and complex process. Difference between product mix and product line, products. This research suggests the integration of the two models as a proper model of the product mix decision. Learn vocabulary, terms, and more with flashcards, games, and other study tools.
Apr 08, 2020 however, the product line is a subset of the product mix. The product mix of a company is generally defined as the complete set of all products a business offers to a market. Product line is too long if profit can be reduced by dropping items from product line. Decisions regarding the product, price, promotion and distribution channels are decisions on the elements of the marketing mix. Starbucks corporation, an american company founded in 1971 in seattle, wa, is a premier roaster, marketer and retailer of specialty coffee around world. Belongs to a single manufacturer shares similar attributes serves the common general purpose but. We can differentiate between downward, upward, and 2way. Decisions regarding sales mix and discontinuation of.
A mathematical modeling approach to product line decisions glen. Product mix and product line are two words used in connection with the range and variety of the products of a company. Product positioning is a strategic management decision that determines the place a product should occupy in a given market its market niche. A product line can contain one product or hundreds of products. A product line refers to a unique product category or product brand a company offers. F a i r d e a l i n g s h o r t e x c e r p t reading. Urban and others published a model for product line decisions find, read and cite all the research you need on researchgate. Pricing can be defined as a process of determining the value that is received by an organization in exchange of its products or services. Product line depth refers to the number of versions offered of each product in the line. Explain five dimensions of service quality and how they apply to a sports team. Decisions regarding sales mix and discontinuation of product. This is done with strategies that determine a target market and an image.
To identify it as part of the mcdonalds product mix, the pizza was branded with the mc prefix. Product and pricing strategies programs, courses aiu. Both of these product line decisions involve adding items to the line. Shampoo, here, forms a different product line, flour forms a different product line as. Product item a specific version of a product that can be designated as a distinct offering among an organizations products. Product line and product mix have direct relationship. Companies sell multiple product lines under their various brand. Product mix the perfect product must provide value for a customer the chartered institute of marketing, 2009, p.
Vocabulary a product line is a group of closely related products manufactured and or sold by a business. A good understanding of product mix is a key element of marketing management. It refers to a number of varieties in forms of sizes, colors, and models offered within each product line. Assortment of size, colour and models offered in each item of a product line. A product line can be also be lengthened by adding more items within the present range e. Ch8 managing products, product lines, brands, packaging. The number of products in a product line refer to its depth, while the number of separate product lines owned by a company is the product line width. The width of the product mix is equal to the number of product lines within a company. Brand extension and line extension brand extension is a part of brand management to diversify and leveraging the existing brand by entering into new product category by new product development. Developing a product or service involves defining the benefits that it will offer. Product mix product mix denotes product development, packaging, branding, and research.
The product mix sometimes called product assortment is made up of both product lines and individual products. Five myths about product and customer mix the kini group. How does the competitive intensity affect the firms product strategies. The product mix, also called product portfolio, is the set of all product lines and items that a company offers for sale. A product line is too short if profits can be increased by adding items.
Dominos is one of the leading global pizza outlets. If austin appliances eliminates a product line, total allocated fixed costs are assigned to the remaining product. The basic product policy strategy issues at the product line level cluster around the following questions. Product line decisions building a strong product line. Handwashing stations, products to help households better manage their childrens feces or. What is product line, product mix, line extension, line width. Reframing the product mix problem using the theory of constraints john davies and vicky mabin school of business and public management victoria university of wellington wellington new zealand vicky. Pdf a model for product line decisions researchgate. As a growing business their aspiration to become the biggest in the industry drives them to find new ways to market their products starting with the soontobelaunched plastic office trunking system. Before turning to the product mix decisions, we first have to know what the product mix actually is. Managing product line and product mix business market. The launch of this new product will be aimed at this particular market segment within the food and beverage market of nigeria. Discuss the various product line decisions marketers make and how a company can expand its product line. A product line is a group of closely related products manufactured andor sold by a company, while a product mix is the total assortment of products that a sports organization makes andor sells.
It refers to degree to which different product lines are related in one or other ways. Product characteristics and marketing strategy 19 the term marketing mix suggests a relationship between interacting, elements. A product mix is a number of different types of product. A product line is a group of products within the product mix that are closely related, either because they function in a similar manner, are sold to the same. Study 166 terms marketing ch 6, 7, 9 flashcards quizlet. We will focus on the important decisions in the development and marketing of individual products and services. Product mix also known as product assortment, it refers to the total number of product a marketer offer for sale to customers, and product line is a group of closely related products known as product line. Download as ppt, pdf, txt or read online from scribd. Trading down introducing a low priced product to the prestigious line so as to cater increased demand. Product design and development is a complex process that involves extensive engineering considerations as well as management decisions based on the overall vision for the product. For example, patanjali deals in different categories of products which include shampoo, flour, toothpaste, etc. Reframing the product mix problem using the theory of constraints.
Selling a 15% margin product from line b will create negative product mix, even though line b has higher average margin. Get an answer for please tell me the example of product line, product mix, product extension and product filling of the particular company. Quality is one of the marketers major positioning tools. Product mix is defined as the set of all products and items that a particular seller offers for sale. This is where the concept of product mix and product line decisions occur, this article clearly explains the differences between product mix and product line in a detailed manner along with examples. It is therefore evident that there is a large proportion of the food and beverage market that require lower cost products that are less perishable, and more filling. The astrocosmo problem considered earlier is an example. Many companies start as a single product item or product line business. There are two overarching strategies that deal with product line. The product line manager typically select one or few items in the line to feature. The product lines may range from one to many and the company may have many products under the same product line as well. Product portfolio management principles of marketing.
Jan 26, 2019 a product line is just a group of related products from a single manufacturer, like the cars on a dealers lot or the shampoos at your hairdresser. A the number of versions offered for each product in the line b how closely related the various product lines are in end use, production requirements, distribution channels, or some other way c the number of different product lines the company carries. The breadth of a product mix shows the different kinds of product lines that firm carries. In making its product line decisions, a firm facing external market pressures.
After getting a taste of success and with an availability of more resources, companies. Thus, taking the above example, if there are 4 product lines within the company, and 10 products within each product line, than the product line width is 4 only. This line deals with the product mix decision on existing products and the flow of production is depicted in figure 1. Product line both manufacturers and retailers must decide on width and depth of a product mix.
A product mix is whole selection of product lines you offer. An individual product in a line is known as a product item. Jun 27, 2012 line modernizing, featuring and pruning product line need to be modernized. Product mix decisions width, length, depth and consistency. Width of the product mix is measured by the number and variety of product lines offered by a firm.
Their product mix includes roasted and handcrafted high. Simply, it shows the number of items in the product line. Samsung has many models of mobile phones from cheap range mobiles. The product line length can be influenced by company objectives and resources. Decisions on a productline level important and complex decisions are also made at the product line level, which tend to determine the length of a companys product mix. Product mix has three important aspectswidth, depth and consistency. Keep in mind is that modularization, as any product decision, must be informed by. The restaurant had experienced success with chicken mcnuggets and the egg mcmuffin earlier as nonhamburger and fries menu additions and. For example, if a company owns a line of hygiene products and also owns a line of house cleaning products, all of those products together would constitute the product mix for the company.
The goods or services that a company produces must be with regard to the needs and the wants of the consumers and the company must be clear if they are providing what the consumers want from them the chartered institute of. The product line of dominos is mainly concentrated on various kinds of pizzas which are customized with respect to the local markets. Managing product line and product mix free download as powerpoint presentation. Crest toothpaste comes in varieties, ranging from crest multicare to crest. Companys objectives also influence product line length. Once you clearly understand opportunities through data analysis and have performed the appropriate strategic mix planning, pass the baton to the sales team, they can take your insights to drive richer product mix and improve the companys bottom line. Product mix, also known as product assortment, refers to the total number of product lines a company offers. Thus, the total number of products against the total number of product lines forms the length of the product mix. This is related to all the product mix and line decisions we have to take in a. Pepsico product line delopment is closely relates to product mix because when product line is big then company product mix also developed. Product mix overview, dimensions and practical example.
The development of the term constituted a step forward in the classification of interrelated marketing efforts. Although product mix problems are seldom encountered in their simple textbook form in practice, they very frequently constitute important. It acts as a crucial element of generating revenue for an organization. In the last ten years, the product management role has expanded its influence in technology companies. In offering a product line, companies normally develop a basic platform and module that can be added to meet different customer requirements. The following points highlight the top ten managerial uses of breakeven analysis. Expanding the product line is the second one of the product line decisions. It can be argued that product decisions are probably the most crucial as the product is the very epitome of marketing planning. If a company has 4 product lines, and 10 products within the product line, than the length of the product mix is 40.
Now, there are four dimensions associated with a companys product mix and the product line breadth is. Product mix and product line understanding product length. Product mix analysis how to drive richer product mix. Product mix, branding, packaging, labeling, warranties, customer service. To manage product mix effectively, you must do so at the product level. Product mix planning is important aspect of companys overall strategy. Individual product decisionprinciples of marketing read. According to this model, the optimal product mix is decided using abc costs except for setup costs, and then the minimal setup cost is. Decisions on a product line level important and complex decisions are also made at the product line level, which tend to determine the length of a companys product mix.
Pdf marketing management project on coca cola mian. In marketing jargon, product lining is offering several related products for sale individually. Each of these product lines is intended to attract a specific customer. A product line is that combination of products which. Product line is too short if profits can be increased by adding items to product line.
The width of product mix is one of the four dimensions of product mix along with the length. Product mix decision making pmdm a product mix is defined as the number of product lines that a company sells. Name and describe the four important dimensions of a product mix. The product mix is the collection of products lines and individual products that a business offers. Line stretching means lengthening the product line beyond the current range. Although more is becoming known about the relationships among elements of the marketing mix. Expansion of product line process of adding more products to the line valid only if. Product line group of products that are closely related because.
These benefits are communicated to and delivered by product attributes such as quality, features, style and design. Innovation is inherently risky, and firms may invest considerable time and money in. Product line is the products that are offered by the company which are similar and can be sold for the same customers to satisfy the same want. Nikes product mix 9 september 2016 converseintroduction the increase in the number of companies and the competitive prices that the companies offer has given rise to a competitive situation in the companies borden, 1984. It can be said as the average number of product items offered by the firm in each product line. A product line in business is a group of related products under the same. It is one of the powerful factors affecting product mix.
Mar 14, 2020 this equation is also known as product line length. The product strategy and mix in dominos marketing strategy can be explained as follows. Jul 23, 20 trading up adding a high priced prestigious product to the line so as to increase the sales of the existing low priced product. Product mix and product line understanding product. Within each product line series are three types of cars. Product mix decision making pmdm definition operations. Decisions at the productmix level represent the highest order decisions made by the company constraining all the subsequent lower order decisions and identifying the busi ness that the company operates. Get an answer for what is product line, product mix, line extension, line width and line depth. In executing brand extension, high profile and well known brand image is more applicable than one with low image. If the documents have been made available under an open.
In rapidly changing product markets, modernization is continuous. A companys product mix refers to the total number of products that are offered for sale. Difference between product mix and product line the product mix of a company, which is generally defined as the total composite of products offered by a particular organization, consists of both product lines and individual products. The strategic role of product management how a marketdriven focus leads companies to build products people want to buy 5 product management is a wellunderstood role in virtually every industry except technology. Nov 04, 2012 the product mix is the collection of products lines and individual products that a business offers. Products cannot be optimized individually and then added to the line to produce optimum product line results. The benefits from having a successful product line is the brand identification from. If austin appliances eliminates a product line, total allocated fixed costs are assigned to the remaining product lines.
Relevant costs in product mix decision making seonmin kim. For example, consider a car company with two car product lines 3series and 5 series. Hence, normally done by persons with experience with understanding of market oriented strategic planning. For instance, a company might want to maintain longer product lines to protect against economic swings. For example, samsung has many product lines, one product line is mobile phones. Decisions regarding sales mix and discontinuation of product line practical application com content writer. View notes ch 11 product mix and product line decisions. For example, all the courses a university offers constitute its product mix, courses in the marketing department constitute a product line, and the principles of marketing course is a product item. Decisions regarding sales mix and discontinuation of product line. Line filling means adding more items within the present range of the line.
A company may have a single product line in which case its product mix becomes the number of products being offered in the line length. Total number of items in the product mix of the company. For example product mix of bajaj company has more than 100 items in various product lines, such as fans, bulbs and tubes, heaters, motorbikes, shooters, richshow, processing machines, and many other ranges. A company formulates its product mix in such a way that competitors can be strongly responded. Therefore, the pricing decisions of an organization have a direct impact on its success. Product mix strategy adopted by the close competitors has direct impact on companys product mix. The product mix could include several lines of products or individual products that do not fall into a line. This dimension of the product mix represents the extent to which the activities of the firm are diversified. Similarly, selling a 30% margin product from line a would have positive impact, despite line as lower average margin. It refers to the total number of items in all the product lines in product mix. It shows the degree of diversification of a firms activities. Other products may also need to figure in the marketing mix. It refers to the relationship of various product line either in their end use, production requirement, distribution channel.
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