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MGTA02H3 Lecture Notes - Business Analysis, Brand Loyalty, Brand Equity

Management (MGT)
Course Code
H Laurence

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MGTA04 Chapter 6: Product
What is a Product?
Customers get value from various benefits, features, and even intangible rewards associated
with a product
Product features are the qualities, both tangible and intangible that a company builds into its
But to attract buyers, features must also provide benefits
Today’s consumer regards a product as a bundle of attributes which taken together, marketers
call the value package: product marketed as a bundle of value adding attributes, including
reasonable cost
Classification of goods and services
o Consumer products
Convenience goods/services: are consumer rapidly and regularly relatively
inexpensive and are purchased frequently with little expenditure of time and
Shopping goods/services: more expensive and are purchased less frequently
than convenience goods and services compare brands, sometimes in different
stores and may also evaluate alternatives in terms of style, performance, color,
price, and other criteria
Specialty goods/services: extremely important and expensive purchases
consumers decide on precisely what they want and will accept no substitutes
spend great deal of money and time to get a specific product
o Classifying Industrial Products
Expense items: relatively inexpensive industrial goods that are consumed
rapidly and regularly
Capital items: expensive, long lasting industrial goods that are used in producing
other goods or services that have a long life
Product mix:
Product mix: the group of products a company has available for sale
Product line: a group of similar products intended for a similar group of buyers who will use
them in a similar fashion multiplied or diversified product lines sometimes created and allow
company to grow rapidly and can help offset the consequences of slow sales in any one product
Developing New Products
To expand or diversify product lines (to survive), firms must develop and successfully introduce
streams of new products
It takes 50 new products ideas to generate one product that finally reaches the market even
then only a few of these survivors become successful products
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