{"id":4287,"date":"2016-01-23T03:12:38","date_gmt":"2016-01-23T03:12:38","guid":{"rendered":"https:\/\/courses.candelalearning.com\/marketingxwaymakerxspring2016\/?post_type=chapter&p=4287"},"modified":"2016-03-14T22:13:18","modified_gmt":"2016-03-14T22:13:18","slug":"reading-defining-product","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/clinton-marketing\/chapter\/reading-defining-product\/","title":{"raw":"Reading: Defining Product","rendered":"Reading: Defining Product"},"content":{"raw":"

Introduction<\/h2>\r\nA product is a bundle of attributes (features, functions, benefits, and uses) that a person receives in an\u00a0exchange.\u00a0In essence, the term \"product\" refers to anything offered by a firm to provide customer satisfaction, tangible or intangible. Thus, a product may be an idea (recycling) , a physical good\u00a0(a pair of jeans), a service (banking), or any combination of the three.[footnote]https:\/\/www.ama.org\/resources\/Pages\/Dictionary.aspx?dLetter=P#product<\/a>[\/footnote]\r\n\r\nBroadly speaking, products fall into one of two categories: consumer products and business products (also called industrial products\u00a0and B2B products). Consumer products are purchased by the final consumer. Business products are purchased by other industries or firms and can be classified as\u00a0production goods<\/em>\u2014i.e.,\u00a0raw materials or\u00a0component parts used in the production of the final product\u2014or\u00a0support\u00a0goods<\/em>\u2014such as machinery, fixed equipment, software systems, and tools that assist in the production process.[footnote]http:\/\/www.businessdictionary.com\/definition\/industrial-goods.html[\/footnote] Some products, like computers, for instance, may be both consumer products and business products, depending on who purchases and uses them.\r\n\r\nThe product fills an important role in the marketing mix because it is the core of the exchange. Does the product provide the features, functions, benefits, and uses that the target customer expects and desires? Throughout our discussion of product we will focus on the target customer. Often companies become excited about their capabilities, technologies, and ideas and forget the perspective of the customer. This leads to investments in product enhancements or new products that don't provide value to the customer\u2014and, as a result, are unsuccessful.\r\n

Four Levels of the Product<\/h2>\r\nThere are four levels of a product (shown in the figure\u00a0below): core, tangible, augmented, and promised. Each is important to understand in order to address the customer needs and offer the customer a complete experience.\r\n\r\n\"The<\/a>\r\n

The Core Product<\/h3>\r\n\"Front<\/a>\r\n\r\nThe core product satisfies the most basic need of the customer. For example, a consumer who\u00a0purchases a healthy\u00a0snack bar may be seeking health, convenience, or simply hunger relief. A student who buys low-priced, sturdy sneakers may just be seeking footwear. A student on a\u00a0tight budget who\u00a0buys top-of-the-line sneakers might be hoping to achieve status. Or, the student might be seeking a sense of freedom by splurging on an item that represents a true sense of style, even though he can't really afford it. Footwear, status, and freedom are all legitimate core products. The core product is complex because it\u00a0is so individualized, and, often, vague. The marketer must have a strong understanding of the target customer (and the different segments of target customers) in order to accurately identify the core product.\r\n

The Tangible Product<\/h3>\r\nOnce the core product has been identified, the tangible product becomes important. Tangible means \"perceptible by touch,\" so the tangible aspects of a product are those that can be touched and held. This idea can be expanded to also include the characteristics of the product that directly touch the buyer in the buying decision. These are the product elements that the customer will use to evaluate and make choices: the product features,\u00a0quality level, brand name, styling, and packaging. Every product contains these components to a greater or lesser extent, and they are what the consumer uses when evaluating\u00a0alternatives.\r\n\r\nThe importance of each aspect of the tangible product will vary across products, situations, and individuals. For example, at age twenty, a consumer might choose a particular brand of new car\u00a0(core product=transportation) based on\u00a0features\u00a0such as gas mileage, styling, and price\u00a0(choice=Toyota Yaris); at age forty-five, the core product remains the same, while the tangible components such as quality level, power, features, and brand prestige become important (choice=Audi A6).\r\n

The Augmented Product<\/h3>\r\nEvery product is backed up by a host of supporting services. The augmented product includes the tangible product and all of the services that support it. Often, the buyer expects these services and would reject the tangible product if they were not available. For example, if you shop at a department store, you are likely focused on a core and tangible product that centers on the merchandise, but you will still expect the store to have restrooms, escalators, and elevators. Dow Chemical has earned a reputation as a company that will bend over backward in order to service an account. It means that a Dow sales representative will visit a troubled farmer after hours in order to solve a serious problem. This extra service is an integral part of the augmented product and a key to their success.\r\n\r\nWhen the tangible product is a service, there is still an augmented product that includes support services. Westin hotels offer hotel nights with a specific set of features as their tangible product. The augmented product also includes dry cleaning services, concierge services, and shuttle services, among others.\r\n\r\nIn a world with many strong competitors and few unique products, the augmented product is gaining ground, since\u00a0it creates additional opportunities to differentiate the product from competitive offerings.\r\n

The Promised Product<\/h3>\r\nThe outer ring of the product is referred to as the promised product<\/em>. Every product has an implied promise, which is a characteristic that is attached to the product over time. The promised product is the long-term result that the customer hopes to achieve by selecting the product. The promised product may be financial\u2014the resale value of a car, home, or property, for example\u2014but it is often more aspirational. The customer hopes to be healthier, happier, more productive, more successful, or enjoy greater status.\r\n\r\nLike the core product, the promised product is highly personal. Generally, marketers find that there\u00a0will be groupings of customers seeking a similar promise but that there is not a single promised product across all customers.\r\n\r\nCan the core product and the promised product be the same thing? Yes, they can, but often the the core product is more focused on the immediate need and the promised product has a longer-term element.\r\n\r\nLet's compare\u00a0two different examples of the same purchase to understand how the product levels might change for different customers.\r\n\r\n\r\n\r\n\r\n\r\n\r\n\r\n
Impetus to buy: I need to be in Miami for a meeting next Thursday<\/td>\r\nImpetus to buy: I need a break from my stressful life<\/td>\r\n<\/tr>\r\n
Core product: transportation<\/td>\r\nCore product: escape, peace of mind<\/td>\r\n<\/tr>\r\n
Tangible product: airline ticket from New York to Miami\r\n
    \r\n\t
  • Convenient routing<\/li>\r\n\t
  • Reasonable cost<\/li>\r\n\t
  • Frequent-flier\u00a0points<\/li>\r\n\t
  • Optimal flight times<\/li>\r\n<\/ul>\r\n<\/td>\r\n
Tangible product: airline ticket from New York to Miami\r\n
    \r\n\t
  • Reasonable cost<\/li>\r\n\t
  • Ease of booking<\/li>\r\n\t
  • Quality of flight experience and service<\/li>\r\n<\/ul>\r\n<\/td>\r\n<\/tr>\r\n
Augmented product:\r\n
    \r\n\t
  • In-flight meal purchase<\/li>\r\n\t
  • Insurance for flight changes<\/li>\r\n<\/ul>\r\n<\/td>\r\n
Augmented product:\r\n
    \r\n\t
  • Full vacation services (hotel, rental car)<\/li>\r\n\t
  • In-flight meal and premium drink purchase<\/li>\r\n\t
  • Baggage services<\/li>\r\n<\/ul>\r\n<\/td>\r\n<\/tr>\r\n
Promised product: productivity, convenience, success<\/td>\r\nPromised product: escape, peace of mind, happiness<\/td>\r\n<\/tr>\r\n<\/tbody>\r\n<\/table>\r\nIn the first case, the customer's impetus to buy is transportation, so that is the core product. In the second case, the purchase is more aspirational and less concrete, so the core product and the promised product are quite similar.\r\n\r\nFor a marketer,\u00a0the most important element is to have a holistic view of the product. If I believe that I'm simply selling airline tickets, then I fail to provide the full product offering that will satisfy either of my customers in the example above. And of course, it is always key to truly understand the motivation and perspective of the target customer.","rendered":"

Introduction<\/h2>\n

A product is a bundle of attributes (features, functions, benefits, and uses) that a person receives in an\u00a0exchange.\u00a0In essence, the term “product” refers to anything offered by a firm to provide customer satisfaction, tangible or intangible. Thus, a product may be an idea (recycling) , a physical good\u00a0(a pair of jeans), a service (banking), or any combination of the three.[1]<\/sup><\/a><\/p>\n

Broadly speaking, products fall into one of two categories: consumer products and business products (also called industrial products\u00a0and B2B products). Consumer products are purchased by the final consumer. Business products are purchased by other industries or firms and can be classified as\u00a0production goods<\/em>\u2014i.e.,\u00a0raw materials or\u00a0component parts used in the production of the final product\u2014or\u00a0support\u00a0goods<\/em>\u2014such as machinery, fixed equipment, software systems, and tools that assist in the production process.[2]<\/sup><\/a> Some products, like computers, for instance, may be both consumer products and business products, depending on who purchases and uses them.<\/p>\n

The product fills an important role in the marketing mix because it is the core of the exchange. Does the product provide the features, functions, benefits, and uses that the target customer expects and desires? Throughout our discussion of product we will focus on the target customer. Often companies become excited about their capabilities, technologies, and ideas and forget the perspective of the customer. This leads to investments in product enhancements or new products that don’t provide value to the customer\u2014and, as a result, are unsuccessful.<\/p>\n

Four Levels of the Product<\/h2>\n

There are four levels of a product (shown in the figure\u00a0below): core, tangible, augmented, and promised. Each is important to understand in order to address the customer needs and offer the customer a complete experience.<\/p>\n

\"The<\/a><\/p>\n

The Core Product<\/h3>\n

\"Front<\/a><\/p>\n

The core product satisfies the most basic need of the customer. For example, a consumer who\u00a0purchases a healthy\u00a0snack bar may be seeking health, convenience, or simply hunger relief. A student who buys low-priced, sturdy sneakers may just be seeking footwear. A student on a\u00a0tight budget who\u00a0buys top-of-the-line sneakers might be hoping to achieve status. Or, the student might be seeking a sense of freedom by splurging on an item that represents a true sense of style, even though he can’t really afford it. Footwear, status, and freedom are all legitimate core products. The core product is complex because it\u00a0is so individualized, and, often, vague. The marketer must have a strong understanding of the target customer (and the different segments of target customers) in order to accurately identify the core product.<\/p>\n

The Tangible Product<\/h3>\n

Once the core product has been identified, the tangible product becomes important. Tangible means “perceptible by touch,” so the tangible aspects of a product are those that can be touched and held. This idea can be expanded to also include the characteristics of the product that directly touch the buyer in the buying decision. These are the product elements that the customer will use to evaluate and make choices: the product features,\u00a0quality level, brand name, styling, and packaging. Every product contains these components to a greater or lesser extent, and they are what the consumer uses when evaluating\u00a0alternatives.<\/p>\n

The importance of each aspect of the tangible product will vary across products, situations, and individuals. For example, at age twenty, a consumer might choose a particular brand of new car\u00a0(core product=transportation) based on\u00a0features\u00a0such as gas mileage, styling, and price\u00a0(choice=Toyota Yaris); at age forty-five, the core product remains the same, while the tangible components such as quality level, power, features, and brand prestige become important (choice=Audi A6).<\/p>\n

The Augmented Product<\/h3>\n

Every product is backed up by a host of supporting services. The augmented product includes the tangible product and all of the services that support it. Often, the buyer expects these services and would reject the tangible product if they were not available. For example, if you shop at a department store, you are likely focused on a core and tangible product that centers on the merchandise, but you will still expect the store to have restrooms, escalators, and elevators. Dow Chemical has earned a reputation as a company that will bend over backward in order to service an account. It means that a Dow sales representative will visit a troubled farmer after hours in order to solve a serious problem. This extra service is an integral part of the augmented product and a key to their success.<\/p>\n

When the tangible product is a service, there is still an augmented product that includes support services. Westin hotels offer hotel nights with a specific set of features as their tangible product. The augmented product also includes dry cleaning services, concierge services, and shuttle services, among others.<\/p>\n

In a world with many strong competitors and few unique products, the augmented product is gaining ground, since\u00a0it creates additional opportunities to differentiate the product from competitive offerings.<\/p>\n

The Promised Product<\/h3>\n

The outer ring of the product is referred to as the promised product<\/em>. Every product has an implied promise, which is a characteristic that is attached to the product over time. The promised product is the long-term result that the customer hopes to achieve by selecting the product. The promised product may be financial\u2014the resale value of a car, home, or property, for example\u2014but it is often more aspirational. The customer hopes to be healthier, happier, more productive, more successful, or enjoy greater status.<\/p>\n

Like the core product, the promised product is highly personal. Generally, marketers find that there\u00a0will be groupings of customers seeking a similar promise but that there is not a single promised product across all customers.<\/p>\n

Can the core product and the promised product be the same thing? Yes, they can, but often the the core product is more focused on the immediate need and the promised product has a longer-term element.<\/p>\n

Let’s compare\u00a0two different examples of the same purchase to understand how the product levels might change for different customers.<\/p>\n\n\n\n\n\n\n\n
Impetus to buy: I need to be in Miami for a meeting next Thursday<\/td>\nImpetus to buy: I need a break from my stressful life<\/td>\n<\/tr>\n
Core product: transportation<\/td>\nCore product: escape, peace of mind<\/td>\n<\/tr>\n
Tangible product: airline ticket from New York to Miami<\/p>\n
    \n
  • Convenient routing<\/li>\n
  • Reasonable cost<\/li>\n
  • Frequent-flier\u00a0points<\/li>\n
  • Optimal flight times<\/li>\n<\/ul>\n<\/td>\n
Tangible product: airline ticket from New York to Miami<\/p>\n
    \n
  • Reasonable cost<\/li>\n
  • Ease of booking<\/li>\n
  • Quality of flight experience and service<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n
Augmented product:<\/p>\n
    \n
  • In-flight meal purchase<\/li>\n
  • Insurance for flight changes<\/li>\n<\/ul>\n<\/td>\n
Augmented product:<\/p>\n
    \n
  • Full vacation services (hotel, rental car)<\/li>\n
  • In-flight meal and premium drink purchase<\/li>\n
  • Baggage services<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n
Promised product: productivity, convenience, success<\/td>\nPromised product: escape, peace of mind, happiness<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

In the first case, the customer’s impetus to buy is transportation, so that is the core product. In the second case, the purchase is more aspirational and less concrete, so the core product and the promised product are quite similar.<\/p>\n

For a marketer,\u00a0the most important element is to have a holistic view of the product. If I believe that I’m simply selling airline tickets, then I fail to provide the full product offering that will satisfy either of my customers in the example above. And of course, it is always key to truly understand the motivation and perspective of the target customer.<\/p>\n\n\t\t\t

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Candela Citations<\/h3>\n\t\t\t\t\t
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CC licensed content, Original<\/div>