PRODUCT MIX DECISIONS
Most companies generally market several products rather than just one or two. It is necessary for them to, understand the relationship among all their products to coordinate their marketing of total group of products. Product item, product line and product mix concepts help us to understand the relationships among a company’s different products. A product item refers to a particular version of a product that is distinct such as Clinic Plus product offered by HUL. A product line is a closely related group of ‘products for essentially similar use and technical and marketing considerations. Colgate product line includes “Colgate dental cream, Colgate gel, Colgate total, Colgate herbal, etc. Product mix is the total number of products that a company markets. Product mix consistency means how closely related different product lines are in end use, product requirements, distribution etc. A company may have many product lines in its product mix. The term product mix width refers to the number of product lines a company has. Product line length means the number of product variants available in a company’s product line.
PRODUCT LINE DECISIONS
Many companies start as a single product item or product line business. After getting a taste of success and with availability of more resources, companies decide to expand their product line and/or introduce newer product lines in consonance with market opportunities or in response to competitor’s moves. For ex. for quite some time Nirma had only a single detergent brand and subsequently added a new product line by introducing a bathing soap, HUL realized the serious threat from Nirma washing powder and introduced cheaper versions of detergents.
Companies make decisions that concern either adding new items in existing product lines, deleting products from existing product lines, or adding new product lines. Another aspect relates to upgrading the existing technology either to reduce the product costs to improve quality, for stretching (downwards, upwards or both ways) or line filling.
Product Line 1
Product Line 2
Product Line 3
Product Line 4
Bathing Soaps
Laundry Products
Beverages
Cosmetics
Dove
Lux
Pears
Liril
Rexona
Lifebuoy
Breeze
Hamam
Jai

Surf
Rin
Sunlight
Wheel
501
Lipton Green Label
Brooke Bond
Red Label
Taj Mahal
Bru
Lipton Taaza
Super Dust
Fair and Lovely
Product Mix of HUL
Product managers need to examine closely, the sales and profits of each item in findings will help them decide whether to build, maintain, harvest, or divest different product lines.
Ø Line Stretching
Product lines tend to lengthen over the years for different reasons such as excess manufacturing capacity, new market opportunities, demand from sales force and resellers for a rich product line to satisfy customers with varied preferences and competitive compulsions. Lengthening of lines raises costs in many areas and decisions are based on careful appraisal.
§ Downward line stretch: Companies sometimes introduce new products with an objective of communicating an image of technical excellence and high quality, and locate at the upper end of the market. Subsequently, the company might stretch downwards due to competitor’s attack by introducing, a low end product in response to competitive attack, or a company may introduce a low end product to fill up a vacant slot that may seem attractive to a new competitor. Another possibility is that market may become more attractive at the lower end due to faster growth rate.
§ Upward stretch: In this situation, companies operating at low end may opt to enter high end because of better opportunities as a result of faster market growth, or the need to create an image of full line company. For ex. Maruti Udyog introduced its medium priced models such as Maruti Zen, Esteem, Wagon R, Alto, and Swift after it had entered the market with its low end Maruti 800 and Omni.
§ Dual or Both way stretch: Companies operating in the medium range of market, may decide to stretch product line(s) both ways for reasons of opportunities arising in different market segments.

High High High
Price Present Product New Product Present Product
Price Price


Low High Low High Low High
Quality Quality Quality
Downward Stretch Upward stretch Both way stretch

Ø Line Filling
A company may decide to lengthen the existing product line (s) by adding more items. The possible objectives leading to line filling may include realizing incremental profits, meeting dealers’ demands in response to their complaints that they lose sales because of missing items in the lines, excess capacity pressures, and trying to fill up vacant item slots to keep out competitors. For ex. Videocon and Onida have introduced various TV models at various price points’ right through high end to low end.
Ø Line Prunning
Line pruning is the just the opposite to line stretching and involves a deliberate decision to cut the number of items in product line(s). Over a period of time, market conditions and customer preferences change, and companies find that some of their product lines contain some unnecessary variants pack sizes. Another reason for line pruning can be the shortage of current production capacity. It is necessary for product managers to periodically review their product lines by examining sales and costs to spot items that are negatively impacting the profits.

Thus most business entities have many products in their portfolio. By dealing in many products, companies aim to serve a much larger and varied group of customers who look for solutions to different types of needs. This also helps to minimize the risks for a company across different products. For ex. ITC diversified from tobacco-based products to hospitality products, financial services and consumer non durables such as edible oil and atta.
Hence we may conclude that product mix consists of all the set of product lines and items that a particular seller offers for sale. A company’s product mix has four important dimensions, namely i) width, ii) length, iii) depth and iv) consistency.
Product width refers to the total number of items the company carries within its product lines. Ex. Procter & Gamble consisting of many product lines like paper, food, household, cleaning, medicinal, cosmetics and personal care products.
Product length refers to the total no. of items the Co. carries within its products lines. Procter & Gamble typically carries many bands with in each lines, for example, it sells eleven laundry detergent, eight hand soap, six shampoo and four dishwashing detergent.
Product depth refers to the no. of versions, offered of each product in the line. Thus Procter & gamble’s Crest Tooth Paste comes in three size and two formulation (paste & Gel)
Consistency refers to how closely relate the various product lines are in end use, production requirements, distribution channels, or some other way.