product meaning, goods and services
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8/8/2019 PRODUCT Meaning, Goods and Services
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MEANING, GOODS AND
SERVICES
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³«the need satisfying offering of a firm«?
what you buy, that satisfies what you want to beable to do.
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` It can be ³good feeling´ because you bought some
cosmetics and someone said you looked pretty««
` It could be happier stomach because you bought a meal
that tasted great«
` It could be easier homework bcoz you bought new
software for your computer««
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` ³Most customers think about products in terms of the
total satisfaction«.´
`
this can lead to statements such as ³we don¶t sell cars,we sell safety !´
` we don¶t sell houses, we sell homes !!!
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Value based pricing
Attractiveness
Of the product
Services mix and qualityProduct features and quality
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` In planning its market offering, the marketer needs
to think through different levels of the product.` Each level adds more customer value, and
constitute a customer value hierarchy.
( Contd«. )
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( Contd«. )
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The primary and most basic level of product is the
core product. It¶s the fundamental service or
benefit that the customer is really buying. Thiscore level of product explains the reason for which
a customer has made a purchase.
( Contd«. )
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In addition to the core product, a customer expects
many things. One can satisfy this need with
physical attributes, brand name, packaging, color,
style, aesthetic looks and quality.This helps the seller to differentiate a product from a
core product.
( Contd«. )
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The intangible components of product along with
the formal and core component is called an
augmented product.
Associated services like:
` Home Delivery, Installations, Customer Care,
Warranty and Guarantee, After Sales Service,
Replacement Policy etc.
( Contd«. )
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The potential product consists of every relevant
thing that one seller can offer to attract and retain
customers.
( Successful Companies add benefits to their offering that
not only satisfy customers, but also surprise and delight
them. ) ³ The best way to hold customers is to constantly
figure out how to give them more for less. ´
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The challenge before the product marketers is tocreate relevant and distinctive productdifferentiation. The product differentiation may bebased on :
` Physical Differences ( eg., features, performance,durability, reliability, design, style, packaging )
` Availability Differences ( eg., available from storesor orderable by phone, mail, fax, internet )
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` Service Differences ( eg., delivery, installation,
training, consulting, maintenance, repair )
` Price Differences ( eg., very high price, medium
price, low price, very low price )
` Image Differences ( eg., symbols, atmosphere,
events, media )
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Any successful differentiation will tend to drawimitators. The innovator faces three choices :
`
Lower the price to protect market share andaccept lower profits.` Maintain the price and lose some market share
and profits.` Find a new basis to differentiate the product and
maintain current price.
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ON THE BASIS OF Durability and Tangibility.
(1) DURABLE PRODUCTS
(2) NON-DURABLE PRODUCTS(3) SERVICES
( CONTD . )
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` These are tangible goods that normally survive
many uses. Normally require more personal
selling and service, command a higher margin,
and require more seller guarantees.
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` These are tangible goods normally consumed in
one or few uses. Because these goods are
consumed quickly and purchased frequently, the
appropriate strategy is to make them available atmany locations, charge only a small mark up and
advertise heavily to induce trial and build
preference.
Non durables like fresh
vegetables,toothpaste, toilet
soaps, etc.
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These are intangible,
inseperable,
variable and
perishable products.Normally require more quality control, superior
credibility, and adaptability.
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` A form of product that consists of activities,
benefits, or satisfactions offered for sale that are
essentially intangible and do not result in the
ownership of anything. Examples: banking, hotel, airline, retail, tax preparation,
home repairs, educational establishments, consultants,
hairdresser, doctors, stockbrokers, trainers
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On the basis of user type :
1. Consumer goods.
2. Industrial goods.
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` Consumer goods are generally purchased for end
consumption or customers use them for personal
or household purposes. Different types of
consumer goods are :
Convenience goods
Shopping goods
Speciality goods
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Industrial Goods are mainly used for further processing in
production to support and manufacture other end
products.
Components/parts«already manufactured but not
assembled.
Eg. Denim fabric, condensers for refrigerators, microchips
for nokia, etc.
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By Sameer Yadav, Pune.