product diversification is the practice of expanding the original market for a product. the manner in which a product is presented can be altered to make it available to a different audience. for example, a household cleaning product could be repackaged and sold as a cleaning agent for automobiles. an existing product could be renamed, perhaps along with somewhat different packaging, and sold in a different country. a product could be repackaged into a different size or standard selling quantity.
for example, a product normally sold as a single unit could be packaged into a quantity of ten and then sold through a warehouse store. the price of a product can be adjusted, along with other improvements, to reposition it for sale through a new distribution channel. it may be possible to extend an existing brand at the low or high end, or fill in a hole somewhere in the middle of the product line. for example, a car company decides to build a sports car that is positioned at the top end of its product line. it may be possible to sell several versions of the same product, perhaps by adding additional features or by offering the product in different colors. product diversification can be expensive, especially when launching it broadly in a new market.
take the time to understand how to effectively plan, organize and execute a new product diversification strategy. you can take a defensive approach with the objective to protect your business if, for example, demand drops for your products or you face strong competition. alternatively, you can take an offensive approach where you see a strong market opportunity but can’t take advantage of it with your existing products. you can modify your existing products so that the new version appeals to a different group of customers. another approach is to add a new product to your range, aimed at a new group of customers. analyze whether you have the resources to develop new products or modify existing ones.
set a budget for the diversification program to cover development and marketing costs. consider the supply chain implications of your new products. does your team have the product and market knowledge to achieve your sales targets? provided the costs of developing and marketing the new product allow you to earn a profit, this is an opportunity to pursue. risk increases if the new product might take sales away from your existing products or if the cost of market entry is very high. carry out a small-scale market test to evaluate the potential of your strategy. analyze the cost of taking the product to market so you can prepare an accurate budget for launching the new product.
product diversification is the practice of expanding the original market for a product. this strategy is a product diversification strategy considers existing products for new pricing or expands new products into markets to in one sense, pinpointing strategic assets is a market-driven approach to business definition. it forces an organization to, . what is product diversification? product diversification is a strategy employed by a company to increase profitability. they show how well a company utilizes its assets to produce profit and achieve higher sales volume from new products. diversification can occur at the business level or at the corporate level. diversification is a corporate strategy to enter into a new products or product lines, new services or new markets, involving substantially different skills, technology and knowledge.
concentric diversification occurs when a company enters a new market with a new product that is diversification is a corporate strategy to enter into a new products or product lines , new services or new markets, product diversification is a business strategy which involves producing and selling a new line of products or product,
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