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± Defn. : A Product is anything that can be offered
to a market to satisfy a want or a need.
‡ Ô
 
± Physical Goods
± Services
± Experiences
± Events
± Persons
± Places
± Properties
± Organisation
± Ideas
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‡ The Competition in today¶s contest is
not between what each company
produces in their factory, but
between what they add to their
factory output in the form of
packaging, services, advertising,
customer advice, financing, delivery
arrangements, warehousing and
other things that people value.

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‡ Each augmentation adds cost
‡ Augmented benefit becomes the expected
benefits
‡ Cost cutting in augmented benefit especially
from the newer player in the market changes
the whole market scenario.
‡ The whole scenario forces consumer to
rethink about their correct expectation i.e.
core product and potential product
‡ This gives an entry to low cost producers

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Ñet¶s understand with an example of Ñife
Insurance
‡ › : The core need that underlies
the existence. e.g. 

‡ Ô
 : All the products that can
satisfy the core need with reasonable
effectiveness. e.g. 

‡ Ô
 : A group of products within
the product family having functional similarity
e.g. 
 

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‡ Ô
 : A group of products that fall
within the same product class and are
marketed through same channel or within
similar price range.e.g.  

‡ Ô
 : A group of items within a
product line that share one of several
possible forms of Product. e.g. 
‡ Ô
 : A unit which can be
distinguished by size, price, appearance or
some other attribute. e.g. Ô 
  


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|arketers have traditionally classified
the products on the basis of
characteristics :

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As per durability and tangibility, the products can
be classified into 3 groups -
1. Non - Durable Goods - These are tangible
goods which may be consumed in 1 or few uses.
2. Durable Goods - These are tangible goods
which are designed to survive several uses.
3. Services - These are always intangible,
inseparable, variable and perishable in nature.

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‡      #&  $%
1. Non - Durable Goods - As consumed quickly
& purchased frequently, the availability is most
important. Heavy advertisement helps business.
2. Durable Goods - Requires more personal
selling / service, longer guarantee. |ay fetch a
higher margin.
3. Services - Normally requires more quality
control, supplier credibility & adaptability.

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‡  '
%
Can be classified typically by the consumers
shopping habits
1. Convenience Goods - covers goods purchased
frequently, immediately without much efforts.
2. Shopping Goods - where in consumer while
selection / purchase characteristically compares
on suitability, quality, price & style.
3. Specialty Goods - have unique characteristics
for which buyers are willing to make a special
purchasing efforts
4. Unsought Goods - very rarely purchased
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‡  '
%
1. Convenience Goods - covers goods purchased
frequently, immediately without much efforts.
e.g. Soaps, newspaper etc
Convenient goods can be further divided -
a) Staples - purchased regularly e.g. Toothpaste
b) Impulse Goods - purchased without planning
e.g. Ice Cream, Soft Drinks
c) Emergency Goods - purchased as & when the
need arises. e.g. Umbrella

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‡  '
#
 $
2. Shopping Goods - where in consumer while
selection / purchase characteristically compares
on suitability, quality, price & style.
e.g. Furniture, Clothing, Appliances etc
Shopping goods can be further divided -
a) Homogeneous Shopping Goods - Similar in
qualities but different enough in prices to justify
comparisons e.g. Shirts
b) Heterogeneous Shopping Goods - differ in
product features & service that are more important
than prices e.g. |obile
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‡  '
#
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3. Specialty Goods - have unique characteristics
for which buyers are willing to make a special
purchasing efforts
e.g. Cars, Camera, men¶s Suits etc
4. Unsought Goods - very rare purchases
Consumers does not know about or think about
buying the product. These goods require
advertising & personal selling support
e.g. Encyclopedia

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‡  '
%
Classified in terms of stage at which they enter the
production process & their relative costliness.
There are three groups of Industrial Goods :
1. |aterials & Parts - that enter the manufacturer¶s
product completely. They fall into 2 classes -
± Raw |aterial
± |anufactured |aterial & parts
2. Capital Items - long lasting items that facilitate
developing or managing the finished product. They
are of 2 types -
± Installations
± Equipment
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3. Supplies & Business Services - short lasting
goods & services that facilitate developing &
managing the finished product.
Supplies are also of 2 types -
± |aintenance & Repair Items
e.g. Nails, brooms, paint etc.
± Operating Supplies
e.g. Ñubricant, fuel etc.
Business Services are also of 2 types -
± |aintenance & Repair Services
e.g. A/c maintenance, Photocopier / Printer repairs
± Business Advisory Services
e.g. Ñegal, Advertising services
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‡ Defn : A Product |ix is a set of all products and
items that a particular seller offers for Sale.
‡ A company¶s Product |ix has following
dimensions :
-
( : refers to how many different product lines the
company carries
! ( : refers to the total number of Items in the mix.
" ( : refers to how many variants are offered of each
product in the line.
) 
: refers to how closely related the various
product lines are in end use, production requirements,
distribution channels or some other way.

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‡ These four Product |ix Dimensions permit the
company to expand it¶s business in different ways.
‡ It can add new product lines thus widening its
product mix.
‡ It can lengthen each product line by adding new
products in the existing product lines
‡ It can add more product variants to each product
and deepen its product mix.
‡ A company can pursue more product line
consistency.

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‡ A Product Ñine length is ( if Profits
can be increased  items.
‡ A Product Ñine length is  if the Profits
can be increased  items.
‡ › *›'% It occurs when
company lengthens its product line beyond its
current range.
‡ The company can stretch its line Downmarket,
Upmarket or Both ways.

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‡ Downmarket Stretch : The company positioned
in the middle market wants to enter into lower
segment. E.g. Peter England Shirts
‡ Upmarket Stretch : The companies wish to
enter high end of the market for more growth or
higher margins or to compete in all segments
e.g. Parle Cream Biscuits
‡ Both Way Stretch : The companies operating in
the middle segment wants to stretch their lines
in both directions.

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