Chapter 2 Flashcards
One of the most common ways of classifying consumer products
Is on the basis of the characteristics of consumer or customer purchasing behaviour.
Buying behaviour
Buying behaviour consists of the various mental and physical activities (behaviour patterns) of decision units (individuals, families and organisations) which determine and follow on the decision-making process for the acquisition of need-satisfying products, ideas and services.
The following characteristics have a bearing on the above distinctions, and therefore indicate the main differences between products and services.
Intangibility.
Inseparability.
Variability.
Perishability.
Intangibility.
This refers to physical things or stimuli that a consumer receives before purchasing. This generally relates to all the elements that stimulate a person’s five senses.
Inseparability.
This refers to the notion that services are normally produced and consumed simultaneously. This element also propagates the theory of involvement or participation because service providers cannot render a service without the presence of a customer.
Variability.
This refers to the nonstandard provision of services. Unfortunately, you cannot keep the quality of a service at its optimum because of the apparent unpredictability of human behaviour.
Perishability.
Services cannot be stored for subsequent use and are therefore perishable from the time of their production.
Travel agents will try to offset this situation by offering seasonal discounts or promotional packages during off-peak seasons, in order to stimulate demand and thereby sell their services.
The definition of consumer goods is based on the following criteria:
It is a tangible commodity that satisfies a need or want.
It is produced and sold primarily to individuals.
It is used for personal, family and/or household consumption.
It is generally a finished product.
It has a noncommercial purpose or use.
Convenience products
These products are relatively inexpensive, require a lower level of consumer involvement, and are generally readily available and frequently purchased. Bread, soft drinks, chips and chocolates are all examples of convenience products.
Convenience products are further classified into the following three classes:
staple products
impulse products
emergency products
staple products
Purchased for everyday use and routine purchases (eg bread and milk)
impulse products
Purchased on the whim (eg chocolates, sweets and chewing gum)
emergency products
Purchased immediately when the need arises (eg candles,
medicine and umbrellas)
Convenience retailing:
Convenience retailing is therefore all about maximising space by carefully identifying the right balance of convenience products, where to place them and how to maximise product-to-consumer visibility.
Shopping products
Shopping products are differentiated according to the amount of time spent on the purchasing decision.
In this category, consumers generally shop around, make comparisons and examine merchandise before making a purchasing decision.
Consider the following important elements of shopping products:
Product quality and performance are more important buying considerations.
Price sensitivity is higher than for convenience products.
There are substantial increases in marketing communications because different brands compete for the same share of wallet.
Personal selling is more important and helps create or maintain relationships.
Speciality products
Speciality products are characterised by a high level of consumer involvement and strong brand preference criteria. Consumers will also spend a lot of time evaluating various alternatives.
Examples of speciality products include stereo systems, sports equipment, cars and computers (to name but a few).
Industrial products
Are purchased not for direct or personal (consumer) consumption, but to help the organisation produce or supply the product to the end-user.
Industrial products therefore help develop or supply consumer products,
Industrial products can be subdivided into the following three categories:
capital, production and operating products.
Capital products
Accessories
Installations
Plant and building
Accessories
Hand tools, jigs, computer, terminals
Installations
Furnaces, machines, turbines
Plant and building
Offices, warehouses, housing, stands
Production products
Raw materials
Manufactured materials
Component parts
Subassembly
Raw materials
Basic, unprocessed products: Oil, fish, fruits, iron ore
Manufactured materials
Acids, fuels, steel rods
Component parts
Semi-finished goods: TV tubes, gauges, small motors, tyres, chassis
Subassembly
Semi-finished products: exhaust pipe
Operating products
Supplies
Services
Software
Services
Legal, auditing, advertising
Software
Microsoft office, Pastel, CAD
Supplies
Fasteners, fuels, paints, light bulbs
