product concepts -marketing management
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8/7/2019 Product Concepts -Marketing Management
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Product Concepts
10-1
Product
Concepts
10Chapter
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Product Concepts
³ A product is anything, tangible or intangible, which can be offered to a market
for attention, acquisition, use, or consumption that might satisfy a need or want.´
Thus, a product can be a physical entity (e.g., computer, shirt, or soap), some
service (e.g., healthcare, tuition, or bank), a retail store (e.g., music store,
locality grocer, or supermarket), a person (e.g., a singer, physician, or politician),
an organisation (e.g., business organisation, trade organisation, or not-for-profit
organisation), a place (e.g., village, city, or country), or idea (e.g., social issues,
concepts, or population control). We use the word µproduct¶ innumerably in
everyday life.
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Product Concepts
A product can be described at five levels:
The first level is the core benefit
The second level is a g eneric product
The third level is the expected product
The fourth level is the au gmented product
The fifth level is the potenti al product
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Product Concepts
Product ClassificationProducts can be grouped under one of the two general categories.
C onsu mer products are those that we buy for our personal or family use
or consumption. Or ganisational products represent those products that
firms and institutions buy to produce other products, to resell, or to run day-to-day operations.
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Product Concepts
Consumer ProductsBased on durability and tangibility, there are three categories:
Durable goods
Non-durable goods
Services
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Product Concepts
The most widely used approach to classifying consumer goods puts them
under four categories:
Convenience Products
Shopping Products
Speciality Products
Unsought Products
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Product Concepts
Organisational ProductsOrganisational or industrial goods can be classified into seven categories
based on their characteristics and intended use:
raw materials,
capital equipment,
accessory equipment,
component parts,
process materials,
consumable supplies and
industrial services.
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Product Concepts
Product Line and Product MixP roduct item, product l ine, and product mix concepts help us understand
the relationships among a company¶s different products.
A product item refers to a particular version of a product that is distinct, such
as Surf Excel is a (premium) product item offered by Hindustan Lever
Limited. A product l ine is a closely related group of products for essentially
similar use, and technical and marketing considerations.
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Product Concepts
Line Stretching
Downward Line Stretch
Upward Stretch
Both-Way Stretch
Line Filling
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Product Concepts
Line Stretching Decisions
High High High
NewProduct
Price Present
Product
Price New
Product
Price Present
Product
NewProduct
PresentProduct
NewProductLow Low Low
Quality Quality Quality
Downward Stretch Upward Stretch Both-Way Stretch
Low Low Low HighHighHigh
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Product Concepts
Line Pruning
Line pruning is just the opposite to line stretching and involves a deliberate
decision to cut down the number of items in product line(s).
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Product Concepts
Product Mix Decisions
Most business entities have many products in their portfolio. By dealing in many
products, companies aim to serve a much larger and varied group of customers
who look for solutions to different types of needs.
Companies make decisions concerning product mix based on competitive
situations, existing or emerging market opportunities, and changes in consumer
lifestyles and preferences.