factors which influence product mix

1. Factors influencing product mix
Sam Joel Dias , Mcom
Shc madanthyar

2. Factors influencing product mix
 Changes in market demand
May be bcz of increase in population
Changes in consumer behaviour
Increase in income level
 Cost consideration( cost of production)
 Advertising and distribution factors
 Image of the producer- high quality and high price
 Objective of maximization of profit

3.  Competitors -action and reaction
 Financial resources of the firm
 Production influences
 Addition of new products (when rival drops)
 Better utilization of by products or waste products
Ex; sugar factory; - card boards., paper
 Marketing efforts
 Demand factor – complementary demand
 Objectives of the firm- profit maximization

4. Objectives & benefits of product mix
 Sales growth
 Market penetration- increasing the share of current market
with existing products and with existing uses
 Market development- expansion of the market creating
new uses of existing products.
 Product development- development of new product to
satisfy the existing customers needs& increase in the share
of product.
 Product diversification- development of new products to
satisfy new consumer needs and consequent expansion of
market.
 sales stability
 Profits

5. Product mix strategies
1. Expansion of product mix- either by increasing product
lines or increasing number of product items in the line
2. Contraction of product mix – removal of product line, or
product item from the product mix
3. Alteration of existing products
4. Positioning of product
bicojoy., godrej etc
5. Trading up and down

6.  Trading up
addition of high priced products to the low priced
products.
 Trading down
opposite of trading up
6. Product differentiation and market segmentation
non price competition in markets which are
imperfect or monopolistic