Plan: Introduction: Product Planning and Development Product Line Product Mix

The important advantages are:
(a) It provides for fuller utilisation of productive capacity.
(b) It facilitates entry into new items without extra marketing expenses.
(c) It enables the marketer to consolidate his advertising and promotional strategy.
(d) It promotes consumer satisfaction.
(e) It acts as a deterrent to competitors who try to step in.
(f) It increases the profitability of the company.
(g) It also satisfies the dealers.
(h) It reduces the risk.
(i) It avoids seasonal fluctuations in sales.

Product Line Decisions:

In fact, decision about adding a new product is not different from other managerial decisions. Taking decision of the product line depends upon a number of factors:
(a) Company’s objectives
(b) Product specialisation
(c) Product influences
(d) Elimination of unsought goods
(e) Marketing influences
(f) Buying habits
(g) Changes in market demand
(h) The distribution net-work
(i) The company’s cost structure
(j) The availability of raw material

3. Product Mix:

It is a broad term which refers to the total assortment of different commodities marketed by a firm. It is, however, treated as a composite. According to Stanton, “The product mix is the full list of products offered for sale by a company”. It may range from one or two product lines to a combination of several product lines or groups.

Characteristics:

There are four principal characteristics:
(a) Length:
Length of the product mix refers to the total number of items in its product mix.
(b) Depth:
Depth refers to average number of items sold by a company within a single product line.
(c) Width:
Width is judged by the number of different product lines dealt with by a company.
(d) Consistency:
Consistency means how many product lines are closely related in production requirements, distribution process, end use, etc.
These four characteristics of the product mix provide the handles for defining the company’s product strategy.