Typically, the reason to increase product variety mainly to increase the number of options in particular if customers couldn’t find their desired product.
At the same time, it can increase the customer satisfaction by doing so, in fact, it brings positive impact because customers will see it as an opportunity to match to their personal need. Besides, by having variety in product category helps to attract new customers and the currently existing ones. Customers would often get bored with their current product and would want to get something different. Or they would use it until their satisfaction level is reached, and craves for something new. Another reason would be that customer look for products not because to only utilize and make use of a particular choice, but rather they want to utilize it over different choices more. Larger pool of choices will help customers with their stronger selection and it enables them to maintain flexibility when buying it. But for all of that, companies reducing variety may prove successful as well, but of course for varied reasons.
For example, ‘Head & Shoulders’ reduced the number of types of shampoo from 26 to 15. As a result, they noticed their sales increased by 10 percent. Sometimes, it is because the customer thinks that too many numbers of variety may be the reason that they won’t feel like buying because they couldn’t handle such high of variety. It would create a mind-decision conflict thus confused hence uninterested or unintended to make the purchase – no decision at all.
However, it all depends on the company’s’ innovation to decide the number of variety they should set for; not too many and not too itsy-bitsy. And they must be able to predict or forecast rightly so with accuracy. In ‘The Impact on Customers’ Perception of Product Variety’, they conducted a survey to gather information on what product variety brings to them and how they feel and think of it.
A total of seven questions for the customers just to have a better understanding how product variety affects their perception – based on electronics and hardware product. The survey will be conducted for the people between the age of 20 and 60. 130 customers, 110 responses, 84.6% of response rate. Questions are given and divided and classified them from five to one – 5 being “Strongly Agree”, 4 for “Agree, 3 for “Neither Agree nor Disagree”, 2 for “Disagree”, and 1 being “Strongly Disagree”.
Eventually the response chart below: It clearly shows that about 55 percent of the customers are willing to pay higher prices to have more variety/options/models within a product. Companies would have their product and the variety cost increase because they have their own costs – manufacturing, inventory and so on to manufacturing more of them. And the data shows that 55 percent of them are willing to pay higher price thus companies will increase the variety of the products to the customers. Also, a comparison between Male and Female below: In this data, we can totally see that male are willing to pay higher prices to have more variety/options/models within a product as compared to female. Then, a comparison between ages below: The above data shows and evident where 55 percent of the ages between 20 and 49 are willing to pay higher prices to have more variety/ options/models within a product. Compared to the ages between 50 and 60 is lesser. The assumption of the reason would be maybe the older customers are ought to be as simple as they can be rather to pay higher for lots of variety offers to them.
Therefore, companies are in advantage of increasing their variety and target them to the younger aged customers and ought to be cautious when making decisions of increasing variety to the older ones. In conclusion, an increase of product variety can be crucial in business. It is good to increase product variety to help customers look at a number of same product and pick the ones they have set eyes and heart on. From there they should be able to know which product is their best-selling.
In addition, it helps to increase customer satisfaction customer value little did they know. I think that DBR have to be careful if they ever to increase their prices and the audience they target but on top of that, I think that their product variety is good.