These Product Mix Strategies Help Your Ecommerce Business Grow (2024)
Starting an ecommerce jewelry brand to build on the success of selling handmade earrings at art fairs, you can expand your product line with handcrafted bracelets. This strategic move will help you establish a successful brand image and strengthen your overall business strategy. Determining your product mix is crucial in achieving this goal.
Product mix refers to the range of products and services offered by your company to consumers. It involves the strategic combination of goods across all product lines and brands in response to market demand and competition. Your product mix plays a vital role in shaping your brand identity and gaining a competitive edge.
Conducting market research and internal product mix analysis can help you determine which products or product lines to keep, change, or remove. It is essential to have a diverse product mix that reflects your brand image and meets customer needs.
Dimensions of a product mix include width, length, depth, and consistency. These dimensions represent the total number of product lines, products, variations within a product line, and the relationship between different product lines, respectively. Maintaining a consistent product mix can help you establish a strong market position.
There are various product mix strategies you can employ, such as expansion, contraction, modernization, filling, and trading up. These strategies involve adding new products, removing underperforming ones, updating existing products, filling gaps in your product line, and introducing higher-priced items to enhance your brand perception. By implementing these strategies effectively, you can create a well-rounded product mix that resonates with your target market.
Expanding Your Product Mix
By adding more expensive products to your line, you can elevate your brand to a higher-end identity. This can also lead to an increase in demand for your company’s more affordable offerings.
Trading down
On the flip side, the trading down pricing strategy involves introducing a product line with lower price points alongside your higher-priced items. Offering more accessible products with competitive pricing can help broaden your customer base and attract new segments, resulting in higher sales. For instance, if you run an enterprise CRM company, you could introduce a scaled-down subscription package for small businesses. This package would include essential features at a lower monthly cost compared to the premium subscription.
Product Mix FAQ
What does a product mix refer to?
A product mix encompasses all products and services offered by a company, including different product lines and brands. It helps companies establish their image and target specific audiences.
What is a product mix example?
For example, Apple’s product mix includes the iPhone, iPad, MacBook, Airpods, Apple Watch, Apple TV, Vision Pro, HomePod, and various branded accessories. Each of these products represents a product line, with multiple versions available for items like iPhones and MacBooks.
What are the four dimensions of a product mix?
The four dimensions of a product mix include width (total number of product lines), length (total number of products across all lines), depth (variations within each product line), and consistency (how product lines relate in terms of use, production, and distribution).
How can a product mix strategy benefit a company?
Implementing a strategic product mix can help a company diversify its offerings, attract different customer segments, and increase overall sales revenue. By catering to various price points and customer needs, a company can strengthen its market position and competitiveness.
What factors should a company consider when developing a product mix?
When creating a product mix, a company should consider market trends, customer preferences, pricing strategies, competition analysis, and overall business goals. It’s essential to balance innovation with market demand to create a successful and profitable product portfolio.
