Roll No. Name
04 Dhaval Bhoraniya
07 Rohan Brahmbhatt
30 Nidhish Kadia
53 Dhruv Patel
Objective of Presentation
• To understand
– What is a Product?
– Five Products levels with Suitable Example.
– Classification of Consumer and industrial Products.
– Product Differentiation with Suitable Examples.
– Service Differentiation with Suitable Examples.
– Product hierarchy with Suitable Example.
– Product system and Mix with example of AMUL.
– Product line decision with example of SUZUKI Cars.
– Product mix Pricing with Suitable Example.
What is a Product?
• A product is anything that can be offered to a
market to satisfy a want or need, including
physical goods, services, experiences, events,
persons, places, properties, organizations,
information, and ideas.
• Theordo Levitt: “Every product have service
component and Every Service have product
– Doctor: Medicine
– Car: Maintenance Service
Five Product Levels
Transportation from one
place to another.
Brand of the car, looks and
design of the car etc.
Decent mileage, proper
engine, inflated tyre etc.
After-sale services, insurance
Auto Driving, Interactive etc.
Durable Goods Service
Industrial Goods Classification
• Actually differentiating the company’s market offering from
competitor so that it achieve desire position in consumer’s
mind to give more consumer value.
Bases of Product Differentiation
Form/ Size Features
After sale service
• When the physical product cannot easily be differentiated,
the key to competitive success may lie in adding valued
services and improving their quality.
Bases of Service Differentiation
The Product Hierarchy
The product hierarchy
stretches from basic
needs to particular items
that satisfy those needs.
We can identify six levels
of the product hierarchy,
using Cooker as an
Product Systems and Mixes
• A product system is a group of diverse but
related items that function in a compatible
– For example, the extensive Nokia Lumia 530 product
system includes headphones and headsets, cables,
cases and car accessories it is Product System for
Nokia Lumia 530.
• A product mix (also called a product assortment)
is the set of all products and items a particular
seller offers for sale.
– A company’s product mix has a certain width, length,
depth, and consistency. These concepts are illustrated
Product Mix of AMUL.
Product Mix of AMUL
Cheese Beverage Paneer Dahi Ghee Mithai
Amul gold Amul
Amul Taaza Amul Lite
Product Mix Width
• Product Line: A group of Product offer by single seller, to
single target customer, to satisfy same kind of need,
through same supply chain, at relatively same price is called
– Amul have Different Product line Like Milk, Paneer, Ghee, Dahi,
Mithai, Beverages etc.
• Product Mix Width: Number of Product line offer by seller.
– Amul have 8 Product line so, Product Width = 8
• Product line Length: Number of Item in each Product Line
– Amul have 6 Item For Milk category so, Product line Length of Amul
Milk = 6
• Product Mix Depth: refers to how many variants are offered
of each product in the line.
– Amul offer 4 Kind of Flavored Milk.
• consistency of the product mix: Describes how closely
related the various product lines are in end use, production
requirements, distribution channels, or some other way.
• Product Mix Assortment: Total Number of Product in
– Amul have totally 33 Product in it’s Product Mix.
Product line Decision
• Line stretching: occurs when a company lengthens its product line beyond
its current range, whether down-market, up-market, both ways and Line
• Line Modernization: In rapidly changing
markets, modernization is continuous.
– Companies plan improvements to encourage
customer migration to higher-valued, higher-
– It’s important to time improvements so they do
not appear too early (damaging sales of the
current line) or too late (giving the competition
time to establish a strong reputation)
– Samsung came up with new version of android,
Processer in it’s smart phones over period of time.
Product Mix Pricing
• Product mix pricing is setting price of Product as Part of
• Objective is to set prices that maximizes profits on the total
• Difficulty arise because of demand and cost interrelationships
and different degrees of competition of products.
• Product line pricing: Price of whole line is set to establish
perceived quality differences that justify the price differences.
Low Price –
Average Price – Average
High Price – Superior
• Optional-feature pricing: Many companies offer optional
products, features, and services with their main product.
Mostly seen in Automobile industry.
Maruti Suzuki Ritz
Price (Ex. New Delhi)
• Captive-product pricing: Base product price is lower where
Captive Product price is High.
Printer is Base Product
Cartridge is captive product for Printer so,
it’s price is high relative to printer price.
• Two-part pricing: Service firms engage in two-part pricing,
consisting of a fixed fee plus a variable usage fee.
– Eg. Hospital have Fix room charge and extra charge for Doctor’s
Visit, medicine, Food etc.
• By-product pricing: in certain Production Process by Product is
resulted from production of main product.
– Eg. Molasses By-Product of Sugar so, Price of Molasses is lower
than price of Sugar.
• Product-bundling pricing: Sellers often bundle products and
features. Pure bundling occurs when a firm offers its products
only as a bundle.
– Eg. Multiplex provide bundle of Film Ticket + Coke + Popcorn at
lower price than price of each products individually.