MKTG1001 Lecture Notes - Botulinum Toxin, Sofitel, Luxury Vehicle
Question 6:
a) Using examples from a product with which you are familiar, differentiate between the three
levels of a product (6 marks).
A product is the key element in the overall market offering. A product is anything that can be
offered to a market for acquisition, attention, use or consumption that should satisfy a want
or a need (A, A, D, K, 2015). These can be tangible or intangible- including goods, services,
experiences, places, persons, ideas, or mixes of these. For example, a Samsung S7 is a
mixture of goods (in the form of the tangible phone itself), services (customer service), and
experiences (brand experience). At one extreme, the offer may be a purely tangible good-
such as a bar of soap, whereas on the other extreme, it could be purely services- such as a
doctor’s consultation. In order to differentiate a market offering, marketers aim to create
and manage customer experiences with their brands. Products can be differentiated through
classifications, and their levels. Classifications include shopping products (less frequently
purchased, more careful comparison by consumer prior to purchase, such as a television),
convenience products (frequently bought with minimum comparison, such as washing
detergent), speciality products (higher priced and bought less often, such as a luxury car),
and unsought products (bought with little product awareness, such as buying a pizza from a
pizza shop you walk past without any prior thought).
Product planning involves consideration of the market offering on three levels- core, actual
and augmented. Each level adds more customer value. The most basic level is core customer
value, which is the level at which the most basic need or want is met. The S7 is generally
bought for customers to communicate with others. Thus, the core product is a cellular
device that allows texts and calls. The second level turns the core benefit into an actual
product, with product and service features, design, a level of quality, brand name and
packaging. The Samsung S7 is not only a device that enables consumers to text and call
friends- but also contains features, style, parts, packaging and its name, combined to
carefully deliver the core customer value of remaining connected, in a way that increases
customer-perceived value. The last level, augmentation, is built around the core benefit and
actual product by offering additional services and benefits. Samsung offers more than just a
communication device with style and features, but also a warranty, instructions, post-
purchase services and a free service number. These build on the actual product to make the
S7 a complete solution to mobile connectivity issues.
As previously discussed in question 1, customers see products as a complex set of benefits to
satisfy needs, wants and demands. In the development stage of a product, marketers must
identify the core customer value, and design the actual product and then augment it to
create the most customer satisfaction.
b) Extending the definition of a product to include services, outline the four characteristics of
services that require special consideration (4 marks).
A company must consider 4 special service characteristics when designing marketing
programs: intangibility, inseparability, variability and perishability (A, A, D, K, 2015).
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Document Summary
Question 6: using examples from a product with which you are familiar, differentiate between the three levels of a product (6 marks). A product is the key element in the overall market offering. A product is anything that can be offered to a market for acquisition, attention, use or consumption that should satisfy a want or a need (a, a, d, k, 2015). These can be tangible or intangible- including goods, services, experiences, places, persons, ideas, or mixes of these. For example, a samsung s7 is a mixture of goods (in the form of the tangible phone itself), services (customer service), and experiences (brand experience). At one extreme, the offer may be a purely tangible good- such as a bar of soap, whereas on the other extreme, it could be purely services- such as a doctor"s consultation. In order to differentiate a market offering, marketers aim to create and manage customer experiences with their brands.
