This presentation discusses products and their classification. It defines a product as anything that can be offered in a market to satisfy a need, want or demand. Products can be tangible goods or intangible services. Consumer products are classified based on shopping habits into convenience goods, shopping goods, specialty goods and unsought goods. Industrial products include materials and parts, supplies and services, and capital items. The key difference between consumer and industrial products is that consumer products are purchased for personal or household use while industrial products are inputs for industrial use.
3. Key Points of Discussion /
Objectives
What is Product ?
Levels of Product Benefits
Classifications of Product
Difference between Industrial
and Consumer Products
6. Tangible
Intangible good or service
that is a result of a process and that
is intended for delivery to a customer
or end user.
Product
7. A SOCCER BALL is an example of a
TANGIBLE PRODUCT.
An example of an INTANGIBLE
PRODUCT is INSURANCE.
Product (Example)
8. Products can also be
classified by use,
by brand, or by other
classifications as well.
Product
9. In MARKETING, a product is
anything that can be offered to
a market that might satisfy a want or
need.
In RETAILING, products are
called merchandise.
In MANUFACTURING, products
are bought as raw materials and
sold as finished goods.
Product Contd…..
12. Overview of the Product
Levels
THE THREE LEVELS OF A PRODUCT ARE AS FOLLOWS:
1.) The Core Product: It’s the intangible benefit
provided by a product.
2.) The Expected Product: It’s the tangible and
physical benefit of a product.
3.) The Augmented Product: It’s the extra add on
,value or service one gets out purchasing a product.
13. Basic Product
Basic Benefit of product that full fill the
need want and basic demand of the
Product.
Example : Sony Camera
Basic Benefit (Capture Pictures)
14. Core Product
This Level is the basic level and simply
looks at what people set out to buy and
what benefits the producer would like
their product to offer buyers.
15. Core Product (Example)
A camera is expected to take pictures
but there may be other benefits that
the producer wants the buyer to enjoy
such as a
Wide lens,
Face recognition
High definition videos.
16. Level 2: Actual Product
Kotler states that this can involve
deciding on the
Quality level,
Product and service
Features,
Styling,
Branding and
Packaging.
17. Actual Product (Example)
Sony Handy cam (brand name),
packaged,
convenient design so you can hold it,
play back features etc.
That provide the desired benefits, high
quality etc.
18. Level 3: Augmented product
It involves deciding the additional non
tangible benefits that a product can
offer. Competition at this level is based
around after sales service,
help lines,
warranties,
Free / cheap delivery and so on.
19. Augmented product
(Example)
Receive more than just the camcorder.
Give buyers a WARRANTY on parts
and Workmanship, free lessons on
how to use the camcorder, quick
repair SERVICE when needed and
toll free telephone number when
needed.
22. THE ACTUAL PRODUCT
PACKAGING-Anodised
Aluminium case, available
in 6 different colours.
Size: 113.5 x 59 x 12.9 mm
Weight (with battery): 135 g
Volume: 86 cc
FEATURES-Works on
Symbian ^3, Has a 12 MP
camera, Radio and Music
player and Gaming.
QUALITY LEVEL: Phone
camera is of exceptional
quality with HD recording.
BRAND: Nokia, which
happens to be one of the
most trusted cell phone
brands in Pakistan.
23. AUGMENTED PRODUCT
DELIVERY: Then
product can be
purchased from any
Electronic goods
showroom. It can be
also ordered online.
INSTALLATION: Not
required.
WARRANTY: The
product has a warranty
period of 1 year.
AFTER SALE
SERVICES: Can be
acquired from any
Nokia service centre.
CREDIT/PAYMENT
25. Product Classification
Can be done in a variety of perspectives
Consumer-Goods Classification
◦ Classified on the basis of shopping habits
Durability and Tangibility
Industrial-Goods Classification
◦ Classified in terms of their relative cost
and how they enter the production
process.
40. Consumer Product
Marketing
Consideration
Convenience Shopping Specialty Un-sought
Customer buying
behavior
Frequent
purchases
Less frequent
purchase
Special purchase
effort
Little product
awareness
Price Low Higher high varies
Distribution Widespread
Distribution
Convenient
location
Selective
distribution in
fewer outlets
Exclusive in one or
few outlets.
varies
Promotion Mass promotion Advertising and
personal selling
More carefully
targeted promotion
by both.
Aggressive
advertising and
personal selling
Example Toothpaste, soap,
candy
Television ,
furniture
Luxury items,
Rolex watches.
Life insurance,
blood donations
43. Physical products or goods have been
classified into two separate categories,
CONSUMER GOODS
INDUSTRIAL GOODS.
Consumer Goods vs Industrial Goods
44. Consumer Goods vs Industrial Goods
Consumer Goods
Shopping goods,
Specialty goods,
Convenience goods.
Unsought goods
Industrial Goods
Materials and Parts
Supplies and services
Capital items
Industrial supplies
Installations
Accessory Equipment
Raw materials
45. Consumer Goods
MARKETING
CONSIDERATION
CONVENIENCE SHOPPING SPECIALITY UNSOUGHT
Consumer Buyer
Behavior
Price Distribution
Promotion
Examples
Frequent purchase,
little planning
little comparison
or shopping effort,
low customer
involvement
Low price
Widespread
distribution,
convenient
locations
Mass promotion
by the producer
Toothpaste,
magazines,
laundry
detergent
Less frequent
purchase, much
planning and
shopping effort,
comparison of
brands on price,
quality, style
Higher price
Selective
distribution in
fewer outlets
Advertising and
personal selling
by both producer
and resellers
Major appliances
televisions,
furniture,
clothing
Strong brand
preference and
loyalty, special
purchase effort,
little comparison
of brands, low
price sensitivity
High price
Exclusive
distribution in
onlv one or a
few outlets per
market area
More carefully
targeted
promotion by
both producer
and resellers
Luxury goods,
such as Rolex
watches or fine
crystal
Little product
awareness,
knowledge (or if
aware, little or
even negative
interest)
Varies
Aggressive
advertising
and personal
selling by
producer and
resellers
Life insurance,
Red Cross blood
donations
47. Review of Presentation
What is Product ?
Levels of Product Benefits
Classifications of Product
Difference between Industrial and
Consumer Products