An Empirical Analysis of Firm Product Line Decisions

Journal of Marketing Research, February 2001

Posted: 3 Jan 2001

See all articles by William P. Putsis

William P. Putsis

London Business School

Barry L. Bayus

University of North Carolina Kenan-Flagler Business School

Date Written: September 1999

Abstract

In this paper, we empirically estimate a descriptive model of firm product line decisions in the personal computer industry over the period 1981-1992. Our analysis incorporates the firm's initial choice of the direction of a product line change (i.e., the product line can be expanded, contracted, or maintained) and the conditional choice related to the magnitude of any product line change (i.e., how many products to introduce or withdraw). For this industry, we find that firms expand their product lines when industry barriers are low or market opportunities are perceived to exist. We also find that high market share firms aggressively expand their product lines, as do firms with relatively high prices or short product lines. In general, our results highlight the various internal and external factors that influence firms in managing their product lines.

Note: This is a description of the article and not the actual abstract.

JEL Classification: C3, L2, L6, M3

Suggested Citation

Putsis, William P. and Bayus, Barry, An Empirical Analysis of Firm Product Line Decisions (September 1999). Journal of Marketing Research, February 2001. Available at SSRN: https://ssrn.com/abstract=253952

William P. Putsis

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom
44-0-171-706-6733 (Phone)
44-0-171-724-1145 (Fax)

Barry Bayus (Contact Author)

University of North Carolina Kenan-Flagler Business School ( email )

McColl Building
Chapel Hill, NC 27599
United States
919-962-3210 (Phone)

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