Product: Concept, importance & Classification

1. (chapter 7) (3rd semester) Product: Concept, importance & Classification

2. According to Philip Kotler, “A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need”. A product may also be defined as a bundle of utilities consisting of various product features and accompanying services. The product may be a single commodity or a group of commodities which satisfy the needs and desires of the consumers. The product may be tangible, intangible, durables, non-durables, manufactured, semi-manufactured, consumer, industrial and an idea. Meaning & Nature of Product

3. From meaning and definitions of product, we can draw the following essential features of a product: • Tangible attributes • Intangible attributes • Associated attributes • Exchange value • Customer satisfaction • Satisfaction of business needs From these essential features of a product it is clear that product may be a physical product or a service. Essential features of Product

4. Out of four elements of marketing mix, the product is the main element without which other elements have no role to play. The importance of product may be summarized as under: • Product is centre of all marketing activities • Starting point of marketing planning • Product is an end • Product is the key to market success • Satisfaction of corporate need • Competitive weapon • Importance from social viewpoint • Importance from consumer viewpoint • Importance from seller viewpoint Importance of product

5. Products represent a bundle of expectations to consumer and society. Thus, product concept is the heart of marketing mix. According to Prof. Theodore Levit, the product concept has three dimensions: • Managerial Dimensions • Consumer Dimensions • Social Dimensions • According to Philip Kotler’ “The product concept holds that consumers will favor those products that offer the most quality, performance and features”.s Product Concept

6. A product has different levels each of which contributes to the total product image. These three levels of product are illustrated in the following diagram: LEVELS OF PRODUCT Augmented Product Actual Product Core product Level of Product CORE BENEFIT

7. The commodity approach to the study of marketing gives us the two possible broad classification of products namely, Traditional Product Classification Modern Product Classification Product Classification

8. The traditional classification is the most popular product classification, which divide the products into two major groups; Consumer Products Industrial Products Traditional product classification may be illustrated as given below: Traditional product classification PRODUCT CLASSIFICATION CONSUMER PODUCTS INDUSTRIAL PRODUCTS CONVENIENCE PRODUCTS SHOPPINGPRODUCTS SPECIALITYPRODUCTS

9. Industrial products are those products which are used for further production of goods and services. Thus, industrial products are meant for non-personal and business use. Industrial products are as follows: • Raw Material • Equipments: Equipment products are of three types: • Installations • Accessory equipments • Plant & Machinery • Fabricated parts and Materials • Operating Supplies Industrial Products

10. Consumer products and industrial products are two broad divisions of manufactured products Following are some important differences among consumer products and industrial products. Basis for differences are as: • Nature of customers • Number of Buyers • Nature of Demand • Extent of Market • Marketing Strategy • Product Analysis Differences between Consumer Products & Industrial Products

11. Leo Aspinwall classify the products on the basis of five characteristics: Replacement Rate Gross margin Adjustment Consumption time Searching time On the basis of these five features Aspinwal classified the products in three colours: Red products Orange Products Yellow Products Modern product Classification

12. On this basis products are classified as; • Durable Products • Semi-durable products • Non-durable products : These can be divided further into two parts: (i) One time use products; (ii) A few time use products Product Classification o the basis of durability

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