A product range strategy comprises all the elements a company must take into account when it is developing a new product line. These elements involve nearly all the different divisions of a business from marketing to engineering and even the sales department. Each division brings a different piece of information to the overall product range strategy. A team effort is needed to ensure the plan is implemented effectively.
A product range strategy often requires in-depth market analysis to determine consumer needs. This analysis may be further broken down into consumer needs by gender, age group and even economic status. Analyzing these factors can help a company determine what products in a given range should be targeted to which consumer groups. Effectively targeting products can maximize chances for success and profitability within a product range and encourage the company to continue developing the product line for other market areas and buyer groups.
Pricing and Design
Market analysis contributes to product design by informing company engineers and artists of how competing products in the market are built and how they are performing in terms of sales. The company then shapes its product design to improve on models currently existing in the market while also attempting to create something totally different from what is currently available. The materials used in construction of the product greatly affect its price. The cost of a product range can also be a useful marketing tool in that a company may wish to create higher end versions of a product for wealthy consumers as well as lower cost models for consumers on a budget.
Selling the Product Range
Deciding where to sell items in a product range can have a great affect on how well these items perform in the market in terms of sales. A business must carefully consider which methods of sale offer the greatest viability for the company's products and which methods of sale most frequently connect the products with the target customer base. For example, a business creating a line of low-cost tables may not choose to sell these products with a high end furniture store because it does not place the product range with consumers likely to purchase them.
An effective product range strategy should also include targets for profits generated from the sale of items within the range. Expected profit numbers are created by examining the level of sales currently existing in the market along with the success of the predicting company's profits with other products. Often a successful company is able to use the sales figures and popularity of other products to gauge likely sales of new product lines. Profit goals then help the company determine the overall success of the product range.