Unit8.ProductClassificationand ProductDecisions
Unit 8. Product Classification and Product Decisions
Products and Services Product is a keyelement in the market offeringMarketing-mix planning begins with formulatingan offering that brings value to target customersand satisfies their needs.This offering becomesthe basis upon which the company buildsprofitable relationships with customers.In modern marketingwe define a product asanything that can be offered to a market forattention,acquisition,use,or consumption andthat might satisfy a want or need.Productsinclude more than just tangible goods. Broadlydefined,productsincludephysicalobjectsservices,events,persons,places,organizations,ideas,ormixes of theseentities
◼ Products and Services ◼ Product is a key element in the market offering. Marketing-mix planning begins with formulating an offering that brings value to target customers and satisfies their needs. This offering becomes the basis upon which the company builds profitable relationships with customers. ◼ In modern marketing we define a product as anything that can be offered to a market for attention, acquisition, use, or consumption and that might satisfy a want or need. Products include more than just tangible goods. Broadly defined, products include physical objects, services, events, persons, places, organizations, ideas, or mixes of these entities
Thus, throughout this text, we use the termproduct broadly to includeany or all of theseentities.Product planners need to think about products andservices on threelevels (SeeP141 Figure8.1)Eachleveladdsmorecustomervalue.The mostbasiclevelisthe core benefit,which addressesthe question What is the buyer really buying?When designing products,marketers must firstdefine the core,problem-solving benefitsorservices that consumers seek.A woman buyinglipstick buys more than lip color.Asan executiveof one of the famous cosmetics companies said:"In the factory,we make cosmetics;in the store,wesellhope
Thus, throughout this text, we use the term product broadly to include any or all of these entities. Product planners need to think about products and services on three levels (See P141 Figure 8.1). Each level adds more customer value. The most basic level is the core benefit, which addresses the question What is the buyer really buying? When designing products, marketers must first define the core, problem-solving benefits or services that consumers seek. A woman buying lipstick buys more than lip color. As an executive of one of the famous cosmetics companies said: "In the factory, we make cosmetics; in the store, we sell hope
ThreeLevelsof Product(SeeP140-141Fig.8.1)Augmented ProductInstallationPackagingBrandFeaturesNameCoreAfter-DeliveryBenefit orSale&CreditServiceQualityServiceDesignLevelWarrantyCoreProductActualProduct2
4 Brand Name Quality Level Packaging Design Features Delivery & Credit Installation Warranty AfterSale Service Core Benefit or Service Actual Product Core Product Augmented Product Three Levels of Product (See P140-141 Fig. 8.1)
Atthesecond level,product planners mustturnthecorebenefit intoan actualproduct.They need todevelop productand servicefeatures, design,a quality level, a brand nameandpackaging.Forexample,aSony camcorderis an actualproduct.Itsname,parts,styling,features,packaging,andother attributeshave all been combined carefully to deliverthe core benefit-a convenient,high-quality way to captureimportantmoments.Finally,product planners mustbuild an augmented productaround the core benefit and actual product by offeringadditional consumer services and benefits.Sony must offermore than just a camcorder.It must provide consumers witha complete solution to their picture-taking problems
At the second level, product planners must turn the core benefit into an actual product. They need to develop product and service features, design, a quality level, a brand name, and packaging. For example, a Sony camcorder is an actual product. Its name, parts, styling, features, packaging, and other attributes have all been combined carefully to deliver the core benefit—a convenient, high-quality way to capture important moments. Finally, product planners must build an augmented product around the core benefit and actual product by offering additional consumer services and benefits. Sony must offer more than just a camcorder. It must provide consumers with a complete solution to their picture-taking problems