Product Mix Strategy | Overview and Practical Example

product mix is crucial for achieving sustained success. The product mix, also known as the product assortment or product portfolio, encompasses the complete range of products that a company offers to its customers.

What is Product line?

product line: a group of products that fulfill the same function. similar benefits, target similar customers, are similarly priced, and follow similar distribution channels

What is Product Mix?

The product mix refers to the total number of product lines that a company offers to its customers. Additionally referred to as product assortment or product portfolio, it includes all the different products that a firm sells. The product mix is typically described in terms of four dimensions: width, length, depth, and consistency.

1. Width: The total number of product lines that a company has to offer. For example, coca cola company

2. Length: The total number of products in a firm’s product mix. This includes all the products across all product lines.

3. Depth: The total number of product variations within a product line, such as different sizes, flavors, or shapes.

4. Consistency: This refers to how closely related the product lines are to each other in terms of use, production, and distribution. Less variation among products means more consistency. For example, a company specializing in dairy products might have high consistency if all its product lines (milk, cheese, yogurt) are related.

Importance of Product Mix

1. Market Coverage: A diverse product mix allows a company to target various market segments, catering to different customer needs and preferences.
2. Risk Diversification: By offering multiple products, a company can spread risk. If one product line underperforms, others may compensate, ensuring overall stability.
3. Customer Loyalty: A well-managed product mix can enhance customer loyalty by providing a range of products that meet different needs, encouraging repeat purchases.
4. Brand Strength: A comprehensive product mix can strengthen the brand's market presence and recognition, making it more resilient to market fluctuations.

Example of Successful Product Mix Strategies

1. Coca-Cola: Coca-Cola’s product mix includes a vast range of beverages beyond its flagship cola. The company continuously innovates with new flavors, healthy alternatives, and localized products to meet diverse consumer preferences.