• Anything that can be offered to a market for attention, acquisition, use or consumption
that might satisfy a want or need.
• More than just tangible objects
• E.g. Apple iPod, a trip to Banff, advice from one’s gardening centre.
• Any activity or benefit that one party can offer to another that is essentially tangible and
does not result in the ownership of anything.
• E.g. banking, hotel, airline, retail
• Products, services, and experiences
• Key element in market offering
• Product a key element in the overall market offering
• Includes both tangible g+s
• May consist of:
• Pure tangible good (no services attached)
• E.g. soap, toothpaste salt.
• E.g. doctor’s exam, financial advice
• Customer experiences
• Customers are buying what those offers will do for them.
E.g. Disney’s dreams and memories through its movies and theme parks, Nike,
• Levels of products and services
• 3 levels
CoreCustomerValue ActualProduct AugmentedProduct
• What is the buyer really • Turning the core benefit to • Building around the core
buying actual products benefit and actual product
• E.g. • Develop: by offering additional
• Revlon - In the factory, • g+s features, design, customer services and
they make cosmetics. In quality level, brand benefits.
the store, they sell name, packaging. • E.g. BB
hope. • E.g. BB is an actual • Solution to mobile
• BB - More than just a product. connectivity problems.
cellphone, email device • Company and dealers
or personal organizer. might give buyers a
Also includes freedom warranty on parts and
and on-the-go workmanship,
connectivity to people instructions on how to
and resources. use the device, quick
repair services, and toll-
free number and
website to use. Product and service classification
• 2 classes: consumer and industrial products (include other marketable entities)
1. Consumer products
• g+s bought by final consumers for personal consumption
• Include convenience, shopping, specialty and unsought products
Convenience Shopping Specialty Unsought
Customer buying • Frequent • Less frequent • Strong brand • Little product
behavior purchase purchase preference and awareness or
• Little planning • Much planning loyalty knowledge
• Little • Comparison of • Little • If aware,
comparison brands on comparison of little/negative
• Low shopping price, quality, brands interest
effort style • Special
• Low customer • High shopping purchase effort
involvement effort • Low price
Price Low Higher High Varies
Distribution • Widespread • Selective • Exclusive Varies
• Convenient • Fewer outlets • 1 or few outlets
locations per market
Promotion Mass promotion Advertising and More carefully Aggressive
by producer personal selling targeted advertising and
by producer and promotion by personal selling
resellers both producer by producer and
and reseller resellers
Examples Toothpaste, Major Luxury goods Life insurance,
magazines, appliances, TVs, blood donations
2. Business products
• Product bought by individuals and organizations for further processing or for
use in conducting a business.
• Difference btw consumer and business products: purpose for which the product
• E.g. lawnmower
• Consumer product: consumer uses it around his house
• Business product: consumer uses it for landscaping business 3 groups
MaterialsandParts CapitalItems SuppliesandServices
Raw materials •Products that aid in the Supplies
• Farm products (wheat, buyer’s productions or • Operating supplies
cotton, livestock, fruits, operations, including (lubricants, coal, paper,
vegetables) and natural installations and accessory pencils) and repair and
products (fish, lumber, equipment. maintenance items (paint,
crude petroleum, iron ore). nails, brooms).
Installations • Convenience products of
Manufactured materials and •Major purchases such as the business field because
parts buildings (factories, offices) they are usually purchased
• Component materials (iron, and fixed equipment with a min. effort or
cement, yarn, wires) and (generators, drill presses, comparison.
component parts (small large computer systems,
motors, tires, castings) elevators) Services
• Sold directly to business • Maintenance and repair
users Accessory equipment services (window cleaning,
• Price and service are the •Portable factory equipment computer repair) and
major marketing factors and tools (hand tools, lift business advisory services
• Branding and advertising trucks) and office (legal, management
are less important equipment (computers, fax consulting, advertising)
machines, desks) • Supplied under contract.
Have shorter life than
installations and imply aid
in the production process. 3. Organizations, persons, places and ideas
Org. Person Place Ideas
Activities undertaken People as products Activities undertaken Social marketing
to create, maintain, or Activities undertaken to create, maintain, or •The use of
change the attitudes to create, maintain, or change attitudes or commercial
and behavior of target change attitudes or behavior toward marketing concepts
consumers toward an behavior toward particular places. and tools in
organization. particular people. programs designed
Cities, provinces, to influence
Practiced by profit To create reputation regions and countries individuals’ behavior
and not-for-profit Businesses, charities, compete to attract to improve their
organizations and other org. use tourists, new well-being and that
famous personalities residents, of society.
Corporate image to help sell their conventions, and
•More than just
advertising products or causes company offices and advertising
• Business firms factories. •E.g. public health
sponsor public campaigns,
corporate image campaigns
and polish their
• E.g. BASF
result in “visible
1. Individual product and service decisions
• The characteristics of a product or service that bear on its ability to satisfy stated or implied
• Closely linked to customer value and satisfaction --> direct impact on g+s performance.
• TQM (total quality management)
• An approach that all company’s people are involved in constantly improving the quality
of products, services and business processes.
• For most top company, customer-driven quality has become a way of doing business
• Most companies are taking a “return on quality” approach, viewing quality as an
investment and holding quality efforts accountable for bottom-line results.
• 2 dimensions: level and consistency
1. Marketer must first choose a quality level that will support the product’s positioning.
• In this case, product quality = performance quality
• The ability of a product to perform its functions
• Companies rarely try to offer the highest possible performance quality level
• Few customers want or can afford the high levels of quality offered.
• Companies choose a quality level that matches target market needs and the
quality levels of competing products.
2. High quality can also mean high levels of quality consistency
• In this case, product quality = conformance quality
• Freedom from defects and consistency in delivering targeted level of
• Competitive tool for differentiating the company’s product from competitors’ products.
• Features that customers value highly in relation to costs should be added.
Product Style and Design
Style - The appearance of a product
• Does not necessarily make the product perform better
• Design - More than skin deep, it goes to the very heart of a product
• Good design contributes to a product’s usefulness as well as to its looks.
• Begins with a deep understanding of customer needs.
• Involves shaping the customer’s product-use experience. E.g. OXO kitchen tools ProductandServiceAttributes
• A name, term, sign, symbol, design, or