STRATEGY

Setting

Chapter 11

WHAT

are the characteristics of

products, and how do

marketers classify them?

While planning market offerings, marketer

needs to address five product levels.

Core Benefit

The service or benefit the

customer is really buying.

Basic Product

A marketer must turn its core

benefit into a basic product

Expected

Product

A set of attributes and conditions

buyers normally expect when they

purchase the product.

Augmented

Product

The product which exceeds

customer expectations.

Potential

Product

Encompasses all the possible

augmentations and

transformations the product

might go in the future.

Ways of classifying

products 2

Product Classification

Use

Consumer-Goods

Industrial Goods

Durability and Tangibility

Durability and Tangibility

Non Durable: They are tangible

and consumed in one or more uses

Durable: They are tangible can

survive many uses

Services: They are non-tangible

require more quality control, supplier credibility

and adaptability

Durable goods Soft drinks and

shampoo

Non-Durable goods clothes

Service Legal advice

Uses

1. Customer-Goods Classification:

When we classify the vast array of consumer

goods on the basis of shopping habits

2. Industrial-Goods Classification: They are classified on terms of their relative

cost and how they enter the production

process.

Consumer-Goods

Classification

Convenience goods

includes soft drinks, soaps

and newspapers

Shopping goods includes

furniture, clothing and

major appliances.

Specialty goods includes

cars, stereo syste , e ’s suit.

Unsought goods includes

life insurance,

encyclopedias and

reference books.

Industrial-Goods

Classification

Industrial-Goods

Capital items Materials and parts Supplies and business

services

Raw materials Manufactured

materials and parts

Farm products

Natural

products Component

materials

Component

parts

These slides were created by Ankit Kumar, IIT

Delhi, during a Marketing internship by Prof.

Sameer Mathur, IIM Lucknow