Optimum Length for a Product Line
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How does a product-line manager arrive at the optimum length for a product line? Briefly describe the strategies that can be used to create a product line with the optimum length.
Kotler, P. (2003). Marketing Management, 11/E. Prentice Hall. Chapters 14, 15, and 16, Pages 406-502. MBA
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This solution examines how a product-line manager arrives at the optimum length for a product line. It briefly describes the strategies that can be used to create a product line with the optimum length. Supplemented with two highly informative articles on optimum product line length.
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Please see response attached for active links, and two supporting articles. I hope this helps and take care.
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1. How does a product-line manager arrive at the optimum length for a product line? Briefly describe the strategies that can be used to create a product line with the optimum length.
The increasing number of consumer goods and services over the years suggests that product line extensions have become a favorite strategy for product managers. A larger assortment, it is argued, keeps customers loyal and allows firms to charge higher prices. There is disagreement, however, to what extent a longer product line translates into higher profits (Draganska, n.d.).
Vertical line extension
Firms may compete their products in two ways. First, by extending the product line to add surplus customers (vertical line extension). For example, by offering a wide range of products, From BMW series 3 to BMW series 7, BMW is able to target many different segments of customers. BMWs vertical line extension strategy involves price discrimination according to consumer's willingness to pay for quality (Draganska, n.d.). Thus, this is the optimal ...
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