Internal Competition

Some companies may want to adopt product mix to increase the market shares and provide more choices for the customers. But my concern is about the internal competition.

Let say a company originally just sell a high-end product (A) and the company actually owns the entire market. If it want to adopt product mix and create a low- end product (B). Besides attracting new customers , will it also compete with product A and divide the market of product A? And how can the company balance between the internal competition and discovering the new market?

I think internal competition is inevitable with product line is established. However, the competition can be minimized through clearer marketing differentiation, enhancing internal products' correlation, and increasing the depth of the product.

Firstly, marketing differentiation refers to building up several product brands (length of product mix) according to different price, features, style and customer services. For example, a low end product is with lower quality and less customers. Apart from that, product can also be separated by the type of users. For instant, some cameras may focus on its brilliant photo quality for professional photographer, while others may highlight that convenient feature with small size for causal users.

Secondly, apart diversifying the product line (width of the product), maintaining the correlation between product lines is also very important. If few product lines of a company can cover several customers' needs in certain aspect of people's life, it may be able to attract people to dig deep into this brand and buy more products from this company once they have tried one of the products. Apple's Mac, iPhone and iPad is one of the examples. It easily attract people to buy another two products when they feel good to use anyone of them. It won't cause internal competition but benefit one another.

Thirdly,