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MGMA01H3 (184)
Chapter 9

Chapter 9 Notes

13 Pages
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Department
Management (MGM)
Course Code
MGMA01H3
Professor
Tarun Dewan

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Chapter 9:
What Is A Product?
Product anything that can be offered to a market for attention, acquisition use, or
consumption that might satisfy a want or need
Example: services, events, persons, places, organizations, ideas, or mixes
Services any activity or benefit that one party can offer to another that is
essentially intangible and does not result in the ownership of anything
Example: banking, hotel, airline, retail, wireless communication, and home-repair
services
Products, Services, and Experiences
Product = key element on the overall market offering
To differentiate their offers beyond simply making products and delivering services,
they are creating and managing customers experiences with their brands or
company
Levels of Product and Services
Product planners need to think about products and services on three levels, each add
more customers value
Core customer value marketers must first define the core, problem-solving benefits
or services that consumers seek
Actual product product planners turn the core benefit into an actual product.
Develop product and service features, a design, a quality level, a brand name, and
packaging
Augmented product product planners must build an augmented product around
the core benefit and actual product by offering additional consumer services and
benefits
Products as complex bundles of benefits that satisfy their needs
Develop products
1. first identify customer value that consumers seek form the product
2.design the actual product
3. find ways to augment it to create this customer value and the most satisfying
customer experience
www.notesolution.com
Product and Service Classification
2 broad classes consumer products and industrial products
Products also included other marketable entities such as experience organizations,
persons, places, and ideas
Consumer Products
Consumer products a product bought by final consumers for personal consumption
classify them based on how consumers buy them
Example: convenience products, shopping products, specialty products, and unsought
products
Convenience products a consumer product that customers usually buy frequently,
immediately, and with a minimum of comparison and buying effort
Example: laundry detergent, candy, magazines, and fast food
usually low priced and in many locations to make them readily available
Shopping products a consumer product that the customer, in the process of
selection and purchase, usually compares on such bases as suitability, quality, price
and style
consumers spend more time and effort gathering information and
comparisons
usually distribute through fewer outlets but provide deeper sales support to
help customers in their comparison efforts
Example: furniture, clothing, used cars, major appliances, and hotel and airline
services
Specialty products a consumer product with unique characteristics or brand
identification for which a significant group of buyers is willing to make a special
purchase effort
Example: specific brands of cars, high-priced photographic equipment, designer
clothes, and the services of financial or legal specialists
Unsought products a consumer product that the consumer either does not know
about or knows about but does not normally think of buying
major new innovations are unsought until consumers aware of them through
advertising
www.notesolution.com
require a lot of advertising, personal selling, and other marketing efforts
Example: life insurance, preplanned funeral services, and blood donations
Business Products
Business product a product bought by individuals and organizations for further
processing or for use on conducting a business
Distinction btw consumer and business product is the purpose of using it
3 groups of business products: material and parts, capital items, and supplies and
services
1.Material and parts included raw materials (farm products & natural
products) and manufactured materials and parts (component materials &
component parts)
a.sold directly to business users
b.price & service = major marketing focus; price & brands = less
important
2.Capital items products that aid in the buyers production or operations
(installations & accessory equipment)
a. Installation major purchases such as buildings (factories, offices)
and fixed equipment (generators, drill presses, large computer
systems, elevators)
b.Accessory equipment included portable factory equipment and tools
(hand tools, lift trucks) and office equipment (computers, fax
machines, desks)
c.Accessory equipment has shorter life and simply aid in the
production process
3.Supplies and services
a.Supplies included operating supplies (lubricants, coal, paper, pencils)
and repair and maintenance items (paint, nails, brooms)
i.= convenience products because purchased with a minimum
effort or comparison
b.Business services included maintenance and repair services (window
cleaning, computer repair) and business advisory services (legal,
management consulting, advertising)
i.Usually supplied under contract
www.notesolution.com

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Description
Chapter 9: What Is A Product? Product anything that can be offered to a market for attention, acquisition use, or consumption that might satisfy a want or need Example: services, events, persons, places, organizations, ideas, or mixes Services any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything Example: banking, hotel, airline, retail, wireless communication, and home-repair services Products, Services, and Experiences Product = key element on the overall market offering To differentiate their offers beyond simply making products and delivering services, they are creating and managing customers experiences with their brands or company Levels of Product and Services Product planners need to think about products and services on three levels, each add more customers value Core customer value marketers must first define the core, problem-solving benefits or services that consumers seek Actual product product planners turn the core benefit into an actual product. Develop product and service features, a design, a quality level, a brand name, and packaging Augmented product product planners must build an augmented product around the core benefit and actual product by offering additional consumer services and benefits Products as complex bundles of benefits that satisfy their needs Develop products 1. first identify customer value that consumers seek form the product 2. design the actual product 3. find ways to augment it to create this customer value and the most satisfying customer experience www.notesolution.comProduct and Service Classification 2 broad classes consumer products and industrial products Products also included other marketable entities such as experience organizations, persons, places, and ideas Consumer Products Consumer products a product bought by final consumers for personal consumption classify them based on how consumers buy them Example: convenience products, shopping products, specialty products, and unsought products Convenience products a consumer product that customers usually buy frequently, immediately, and with a minimum of comparison and buying effort Example: laundry detergent, candy, magazines, and fast food usually low priced and in many locations to make them readily available Shopping products a consumer product that the customer, in the process of selection and purchase, usually compares on such bases as suitability, quality, price and style consumers spend more time and effort gathering information and comparisons usually distribute through fewer outlets but provide deeper sales support to help customers in their comparison efforts Example: furniture, clothing, used cars, major appliances, and hotel and airline services Specialty products a consumer product with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort Example: specific brands of cars, high-priced photographic equipment, designer clothes, and the services of financial or legal specialists Unsought products a consumer product that the consumer either does not know about or knows about but does not normally think of buying major new innovations are unsought until consumers aware of them through advertising www.notesolution.com
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