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1. 8-1
FINDING THE
RIGHT SPOT ON
THE CONTINUUM

2. 8-2
INTRODUCTION
• To describe and further develop existing models of service
transition; that is, how companies position and move on the
goods-to-services continuum.
• This study concludes that service transition can be
profitable for manufacturing firms as long as they do not
become stuck in a mismatch between their organisational
arrangements and their offerings.
• It contributes by: providing an overview of companies’
positions on the goods-to-services continuum, introducing
movements on the continuum, suggesting service
development as a possible engine of renewal and providing
empirical evidence on the relationship between positions
on the continuum and profit margins.

3. 8-3
PRODUCT AND
SERVICE
CONTINUUM

4. 8-4
The empirical investigation had four main aims:
• 1 - to provide an overview of companies’ positions on the
goods-to-services continuum
• 2 - to introduce specific movements on the continuum
• 3 - to suggest service development as a possible engine of
renewal
• 4 - to provide empirical evidence on the relationship
between positions on the continuum and profit margins of
the firms.

5. 8-5

6. 8-6
The Good/Services Continuum
Target
Market
Promotion Price
Place
Product
Product idea Brand Package Warranty
None, limited
full, extended
Physical
good/services
Features
Benefits
Quality level
Accessories
Installation
Instruction
Product line
Type of Brand:
Individual or
family
Manufacturer or
dealer
Protection
Promotion
Enhancement

7. 8-7

8. 8-8
WHAT IS A PRODUCT?
• Product:
• An idea, a physical entity (a good), a service, or any combination of the
three that is an element of exchange to satisfy individual or business
objectives .

9. 8-9
TYPES OF PRODUCTS
Goods:
Physical products
with form and
substance
Services:
Non-physical products
usually involving
performance
Consumer Products:
Those used by
consumers for their
own use and
satisfaction.
Business Products:
Those used in the
running of a business
or in the manufacture
of products for resale.

10. 8-10
Canned
foods
Ready-
made
clothes
Auto-
mobiles
Carpets Rest-
aurant
meals
Repairs:
auto, house,
Air
travel
Insurance,
Consulting,
Teaching
MOSTLY GOODS MOSTLY SERVICES
The Good/Services Continuum

11. 8-11
PRODUCT DIFFERENTIATION
• Product Differentiation:
• Exists when a firm’s
offerings differ or are
perceived to differ from
those of competing firms on
any attribute, including
price.

12. 8-12
GOODS AND SERVICES
• Goods:
• Physical products. • Services:
• Nonphysical products.

13. 8-13 © 2002 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin—for use only with Basic Marketing
DIFFERENCES IN GOODS AND SERVICES
Where produced (storing
and transporting)
Tangibility
When produced
relative to when
consumed
Balancing supply and
demand
Contact with customer by
producer of product
Differences

14. 8-14
CHARACTERISTICS AND STRATEGIES FOR
SERVICES
Service Characteristic Service Strategy
Intangible Associate service with
something tangible
Perishable Manage demand to utilize
supply
Inseparable Capitalize advantages of
person providing service
Variable Standardize service delivery
as much as possible

15. 8-15
PRODUCT CLASSES
• Two broad classes
– consumer products
– business products
• Classes help in planning marketing mix
needed
• Based on how the customer views the product
– how consumers think about and shop for
products
– how business/organizational buyers think
about products and how they'll be used

16. 8-16
CONSUMER AND BUSINESS PRODUCTS
• Consumer Products:
• Products that are
purchased by
consumers for their
own personal use.
• Business Products:
• Products purchased by a
firm or organization for its
own use.

17. 8-17
TYPES OF CONSUMER PRODUCTS
Convenience
Products
Shopping
Products
Specialty
Products

18. 8-18
TYPES OF BUSINESS PRODUCTS
Capital
Products
Production
Products
Operational
Products

19. 8-19
BUSINESS PRODUCT CLASSES

20. 8-20
PRODUCT COMPONENTS
Product
Components
Product Features
• Quality
• Design
• Branding
• Packaging
Service Features
• Purchase services
• Usage services