A Product is anything that is offered in a market for sale that might satisfy a need or want. It is a bundle of utilities consisting of various features and accompanying services.
According to Phillip Kotler – “It is a bundle of physical services and symbolic particulars expected to yield satisfactions or benefits to the buyer.”
Products are central to the marketing efforts of any business. Products are the building blocks of a marketing plan. According to Stanton, “It is a set of tangible and intangible attributes, including, packaging, colour, and retailer`s services which a buyer may accept as offering for satisfaction of needs or wants.”
Characteristics of a Product
- It may be tangible or intangible
- It consists of associated attributes such as brand, package, warranty etc.
- It has an exchange value
- It has the ability to satisfy consumer needs and wants
Classification of Products
On the basis of Tangibility
- Tangible Products
- Intangible Products
On the basis of Durability
- Durable Products
- Non-Durable Products
On the basis of User
- Consumer Goods
- Industrial Goods
Types of Products
On the basis of Nature
- Goods – Tangible and physical materials
- Services – Intangible benefits
- Property – Intangible right of ownership
On the basis of Consumer
- Consumer Products – Products bought by final consumers for personal consumption. They can be further classified into:
- Convenience Products – Goods which a consumer buys frequently and that require minimum customer effort or thought eg. Toothpaste
- Shopping Products – Goods that a consumer buys after careful selection from different alternatives. Customers invest their time and effort to compare quality, price, style etc. of such products.
- Specialty Products – Goods having unique characteristics and/or brand identification for which a significant group of buyers are willing to make an extra purchasing effort.
- Unsought Products – Products about which potential buyers are unaware or do not wish to purchase.
- Industrial Products – Products bought by organisations for resale or further processing and value addition to make a final product. They are sold primarily for producing other products. They consists of –
- Raw materials
- Capital Equipment
- Machinery & Equipment
- Industrial services
On the basis of Social Benefits
- Pleasing products – Products which give high immediate satisfaction but harm the consumer in the long run e.g. Cigarette
- Deficient Product – Out-dated products
- Salutary Products – Products that provide benefits in the long run but no immediate satisfaction.
- Desirable Products – Products that provide high immediate satisfaction and consumer welfare in the long run.
Levels of Product
A marketer has to plan products and its attributes according to different levels of the product. This must be done in such a way that it adds more value to the product and makes the offering more attractive to the customer.
These 5 levels of product are:-
- Core benefit – The fundamental service or benefit that the customer is actually buying.
- Basic Product – The benefit or attribute that the customer is buying that is derived from core benefit.
- Expected product – Set of attributes or benefits a customer already expects (normal features)
- Augmented Product – Set of attributes that exceeds customer expectations ( unique additional features)
- Potential Product – Possible augmentation or transformation the product might undergo in the future.
Decisions to be taken while making a strategy for products
- Product Line – A group of closely related products that are sold to same customer groups and marketed through same distribution channels
- Product Mix – Set of all product lines and items that a particular seller offers for sale to buyers
- Product length – Number of items in each product line
- Product Depth – Number of variants offered in each item of a product line
- Consistency – Relation between various product lines
- Branding – Symbolic and visual elements
- Packaging and Labeling
Elements of Product Planning
Planning for products involves:
- Eliminating unprofitable and deficient products from the product line
- Developing plans for existing profitable products with respect to changing marketing environment
- Improving existing products to meet the changing market requirements
- Introducing new products on the basis of changing consumer demands
Factors influencing Product Mix
- Market Demand
- Competitors Strategy
- Cost and Quantity of Production
- Use of Residuals
- Goodwill of the Company
- Changing Consumer Behaviour
- Purchasing power of Customers
- Advertising and Distribution Factors