Product diversification is basically done when you are planning to expand the original market for a specific product. This method is used to increase the existing product line sales , especially for the product which is declining in sales. Diversification can be achieved by either entering in new market segment or by doing price changes.
What it means to Diversify the Products?
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Product Diversification means to expand your business with launching new product, in the new market. Diversification of product is done to maintain stability in the firm’s revenue. The strategy is used by a company to increase the total profitability from the new products. The matrix is called as Ansoff Matrix
To Diversify the Products, means expanding the original market for that product. Diversification is generally done for increasing the sales of the existing product. It can be done by many ways, some of the steps that can be taken are following
- Repackaging - Company can change the packaging , the manner in which it was delivered to customers can be changed.
- Renaming - Existing product can be sold in the market after renaming the product along with some different packaging.
- Repricing. - Next steps that can be done, is price change along with some product changes, and then re positioning it again, through different channel.