What is a product? Flashcards
What is the definition of a product?
“Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need” - koTLER et al
How are products classified?
Either Consumer products or Industrial products.
Consumer products: Personal consumption
Convenience: Bought frequently, little buying effort
Shopping: Bought less frequently, careful information gathering and comparison
Specialty: Unique characteristics, special purchase effort
Unsought: Unknown/ normally unconsidered
Industrial products:purchased for further processing / in a business
Materials and parts - raw materials, and manufactured parts
capital items - industrial products that aid in the buyers production like installations (Buildings, factories, elevators) and accessory equipment ( computers, fax machines)
supplies and services - supplies ( coal, paper, paint, nails) Usually minimal buying effort
Services ( maintenance and repair)
What are services?
A form of product that consists of activities, benefits or satisfactions offered for sale that are intangible and do not result in the ownership of anything. Eg banking, hotels.
What are the three levels of of products and services that product planners need to consider?
core customer value - what is the buyer really buying? the core, problem solving benefits that consumers seek.
Then , product planners must turn the core product into actual product - need to develop features, design and quality level, branding.
Augmented product is the final level - offering additional customer services and benefits creating a full and satisfying brand experience.
EG iPad, is augmented to be more than just a digital device, it provides consumers with complete connectivity solution, comes with warranty etc.
Explain how marketers have broadened the concept of a product to include organisation, persons, places and ideas.
Organisations: carry out activities to “sell” the organisation itself. consists of activities undertaken to create, maintain, or change attitudes and behaviour of target consumers towards an organisation.
Person marketing: activities undertaken to create, maintain or change attitudes and behaviour towards particular people, ranging from presidents, entertainers, sports figures. Eg celebrity endorsement
Place marketing: activités undertaken to maintain, create or change attitudes towards a particular place. cities, states, regions, countries. competitions to attract new tourists, residents, company offices.
Ideas Marketing: narrowed to the idea of social ideas, social marketing. using traditional business marketing concepts and tools to create behaviours that will create individual and social wellbeing. focuses on beneficial social change. EG advertising campaigns.
What are the 3 different types of products based on classification?
Durable good: Lasts for many uses, infrequently purchased. Relatively expensive and selective distribution. EG fridge
Non - durable: Used once, frequently purchased and relatively inexpensive. intensive distribution. EG innocent smoothie
Service: Intangible good EG travel entertainment.
What are the three levels that marketers make product and service decisions at?
Individual, product line and product mix
Explain stage 1 of the individual product and service decisions
1) Attributes: defining the benefits the product or service will offer. a) Quality - affects product or service performance, thus closely linked to customer value and satisfaction. performance quality - ability to perform functions and conformance quality - freedom from defects and consistency in delivering a targeted level of performance.
b) Features - can create higher level models of a product by adding more features. they are a competitive tool for differentiating the companies product from competitors. Can use customers surveys to find out what features to add. c)Style and design - design begins with understanding customers wants and needs and shaping product to fit their satisfaction. style can be eye catching or yawn producing.
Explain stage 2 of the individual product and service decisions
2) branding
brand - A name, term, sign that identifies the products or services of one seller/group of sellers, differentiating from competitors.
- branding can add value to a service or product, as customers attach their own meanings to them and develop brand relationships.
- can also tell consumers about the quality of what they’re buying, reputation.
Explain stage 3 of the individual product and service decisions
3) Packaging - the activities of designing and producing the container fro a product
- can create immediate consumer recognition of a brand
- especially important now a days as we want to follow the social aim of reading plastic.
- can have issues like too complicated or over packaging. childproof packaging
- therefore a lot more impact on the product and how well it sells than some people might think
Explain stage 4 of the individual product and service decisions
4) Labelling
range from simple tags, to complex graphics,
- identifies the product and brand, maybe describe things about the product, and might even help to promote the product and business.
- can support brands positioning and add personality to the brand.
- issues like misleading, incorrect information, eg fail to describe important ingredients
Explain stage 5 of the individual product and service decisions
5) Product support services
- a company offer usually includes some support services which can be a minor or major part of the total offering. in this sense, service that augments a product, not a service as a product itself.
- important part of customers overall brand experience
- can survey customers as to assess the value of current services and obtain ideas for new ones. can then take steps tot fix problems and add new services to benefit the customer.
Explain what is meant by product line decisions and what it includes
Product line - group of products that are closely related because they function in a similar manner, are sold to the same customer groups and marketed through the same types of outlets.
- major product line desision includes product line length - number of items in product line. need to assess each items sales and profits and understand how each one contributes to the product lines over all performance, before adding or dropping from it
- line filling - adding more items within the present range, either to increase profits, satisfy dealers, plugging holes to keep out competitors.
Line stretching - company lengthens its line beyond its current range. can stretch upwards / downwards. companies in upper end of the market can stretch downwards, and vice versa. could be due to faster growth in lower end, vice versa.
Explain what is meant by product mix decisions and what is included.
Product mix / portfolio - the set of all product lines and it6ems that a particular seller offers for sale.
four dimensions to the product mix
1) Width - no. of product lines
2) length - no. of product types within product lines
3) depth - no. of variations of each product type (eg scented or unscented)
4) Consistency - relatedness of product lines
can increase depth/length - adding new products
- keeps out competitors and fills market gaps but can lead to product failure and customer confusion
reduce depth/length- removing products
- increases consistency and clearer positioning but misses opportunities and leaves gaps for competitors
What are the characteristics of services as products?
Intangibility - cannot be seen, tasted, touched or heard
Inseparability - cannot be separated from their providers
Variability - quality depends on provider and when where and how
perishability - cannot be stored for later use
