Product (business)
In marketing, a product is anything that can be offered to a market that might satisfy a want or need. However it is much more than just a physical object. It is the complete bundle of benefits or satisfactions that buyers perceive they will obtain if they purchase the product. It is the sum of all physical, psychological, symbolic, and service attributes. A product is similar to a good. In accounting, goods are physical objects that are available in the marketplace. This differentiates them from a service, which is a non-material product.
Three Aspects There are three aspects to any product or service: 1 - Core Benefit in-use benefitspsychological benefits (e.g., self-image enhancement, hope, status, self worth)problem reduction benefits(e.g., safety, convenience)
2 - Tangible Product or Serviceproduct attributes and featuresqualitystylingpackaging protection and label informationbrand name
3 - Augmented Product or Servicewarrantyinstallationdeliverycredit availabilityafter-sale service and maintenance
Classifying Products Product management involves developing strategies and tactics that will increase product demand (referred to as primary demand) over the product's life cycle. One useful technique in understanding a product is the Aspinwall Classification System. It classifies and rates products based on five variables: 1) replacement rate - how frequently is the product repurchased2) gross margin - how much profit is obtained from each product (average selling price less average unit cost)3) buyer goal adjustment - how flexible are the buyers' purchasing habits in regards to this product4) duration of product satisfaction - how long will the product produce benefits for the user5) duration of buyer search search behaviour - how long will they shop for the product
Types of Products There are several types of products: consumer products - used by end usersindustrial products - used in the production of other goodsconvenience goods - purchased frequently and with minimal effortimpulse goods - purchase stimulated by immediate sensory cuesemergency goods - goods required immediatelyshopping goods - some comparison with other goodsspecialty goods - extensive comparisons with other goods and a lengthy information searchunsought goods - e.g., cemetery plots, insuranceperishable goods - goods that will deteriate quickly even without usedurable goods - goods that survive multiple use occasionsnon-durable goods - goods that are used up in one use occasioncapital goods - installations, equipment, and buildingsparts and materials - goods that go into a finished productsupplies and services - goods that facilitate productioncommodities - undifferentiated goods (e.g., wheat, gold, sugar)by-products - a product that results from the manufacture of another product
See Also brand brand management failed product marketing product management product (project management) service whole product
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