The Product Decision
Determining a Product Mix
Product Decision involves
Determining goods & services to offer to
satisfy consumer’s wants & needs based
on market opportunities
Two Types of Products
 Consumer Goods:
Purchased and used by the
ultimate consumer for personal use.
 Business Goods: Purchased by organizations
for use within a business.
Product Classifications Terms

Product Item: Individual good that satisfies consumer
wants or needs
Example: Nike produces the Air Pegasus 27
Running Shoe.

Product Line: A group of closely related products
manufactured and/or sold by a company.
Example: Nike has a product line of running shoes.

Product Mix: The total assortment of products that a
company makes and/or sells.
Example: Nike carries several lines of shoes to
make up its shoe product mix.
A Company’s Product Mix can be
Broad or Narrow
Broad Product Mix:
Offers a lot of different
types of product lines &
items.

Companies with a Broad
Product Mix
Nike
Sears
Wal-mart
Narrow Product Mix:
Specializes in a particular
type of product lines &
items.

Companies with a
Narrow Product Mix
Louisville Slugger
The Sunglasses
Company
Taylor Made
Shallow Vs. Deep Product lines
 Deep Product lines - Have a lot of different items
within each product line. (Companies with a
narrow product mix)
 Shallow Product Lines – Have a limited amount
of items within each product line. (Companies
with a broad product mix)
Product Extensions
Having additional products in a product mix in
relation to another product.
Example: Carrying shoe strings with shoes that
are for sale.
Product Life Cycle
The lifespan of a product’s popularity that
it goes through broken down into 5
stages..
Products Go Through a
Product Life Cycle
Introduction: Product is first introduced into the
marketplace
 Growth: Product gains demand and other competitors
enter the market.
 Maturity: Peak demand when sales begin to level off.
 Decline: Sales & profits drop.
 Obsolescence: Product has minimal demand in the
marketplace.

It is Important for Marketers to Know
What Stage of the Product Life Cycle
Products are at to Determine Actions
that Maximize Profits.
Product Strategies Used to
Maximize a Product’s Profits

Product Modification: Change a product’s
characteristics in order to increase sales.
Example: Sony Playstation 1, 2, & 3

Market Modification: Target new markets with a
product.
Example: Gatorade creates the “Frost” brand to target nonathletes

Repositioning: Changing a product’s image in relation
to its competitor’s image.
New Balance offers a wider shoe than other shoe
manufacturers to differentiate its product.