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STRATEGY
Setting
Chapter 11
WHAT
are the characteristics of
products, and how do
marketers classify them?
While planning market
offerings, marketer
needs to address five
product levels.
Core Benefit
The service or benefit the
customer is really buying.
Basic Product
A marketer must turn its core
benefit into a basic product
Expected
Product
A set of attributes and conditions
buyers normally expect when they
purchase the product.
Augmented
Product
The product which exceeds
customer expectations.
Potential
Product
Encompasses all the possible
augmentations and
transformations the product
might go in the future.
Ways of classifying
products2
Product
Classification
Use
Consumer-
Goods
Industrial
Goods
Durability and
Tangibility
Durability and Tangibility
Non Durable: They are tangible
and consumed in one or more uses
Durable: They are tangible can
survive many uses
Services: They are non-tangible
require more quality control, supplier credibility
and adaptability
Durable goods
Soft drinks and
shampoo
Non-Durable goods
clothes
Service
Legal advice
Uses
1. Customer-Goods Classification:
When we classify the vast array of consumer
goods on the basis of shopping habits
2. Industrial-Goods Classification:
They are classified on terms of their relative
cost and how they enter the production
process.
Consumer-Goods
Classification
Convenience goods
includes soft drinks, soaps
and newspapers
Shopping goods includes
furniture, clothing and
major appliances.
Specialty goods includes
cars, stereo syste , e ’s
suit.
Unsought goods includes
life insurance,
encyclopedias and
reference books.
Industrial-Goods
Classification
Industrial-Goods
Capital items
Materials and parts Supplies and business
services
Raw materials
Manufactured
materials and parts
Farm products
Natural
products
Component
materials
Component
parts
These slides were created by Ankit Kumar, IIT
Delhi, during a Marketing internship by Prof.
Sameer Mathur, IIM Lucknow

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