This work presents a comprehensive, theoretically grounded explanatory model of product variant diversity. The diversity-related impact analysis of the purchasing decision and variant production process is based on a novel definition of variant diversity that encompasses not only the number of variants but also the degree of difference among them. To highlight the significance of the perception of variant diversity, the concept of producer confusion is developed in analogy to consumer confusion. Finally, implications for variant management and a diversity-related performance measurement system are derived from the results of the impact analysis.