What is a Product?
EVERYTHING, both tangible and intangible, that a buyer receives in an exchange.
Product can be:
Good, Service, and Idea
Consumer and Business
Consumer Products are
Products purchased by individuals for their own use.
Business Products are
Products purchased by businesses to resale them or to use for business product.
4 Types of Consumer Products
Convenience Products, Shopping, Specialty, and Unsought.
Convenience Products are
frequently bought, normally cost little, don’t require a lot of work.
Most Convenience Products have what?
Low Per Unit Gross Margins= don’t make money for each one they sale.
Shopping Products are
The opposite of convenience products. Not as frequently bought, cost more, require effort.
Specialty Products are
Products that have at least one unique characteristics. Only available in certain areas & locations, product is a limited edition.
Unsought Products are
Consumers generally do not see the need for these products.
Example of Unsought Products are things like:
Life Insurance, Renters Insurance, Security Systems, Etc.
3 Types of Business Products
Installations, Component Parts, and MRO Supplies
Installation Products are
High price products that are bought to make things. (Robotics, Construction Equipment)
Component Parts Products are
Finished products that become part of a final product and then sold.
Example of Component Parts Products are
Auto-mobiles, the industry use component parts- they buy parts from other manufactures and put the car all together for a final product.
MRO Product Supplies are
Items that facilitate production, but they do not become part of the final product.
3 ways of Classifying Products via Organizational Strategy:
Product Mix, Product Line, and Product Item
Product Mix are
All products offered by an organization.
Product Line are
Closely related products that have similar end use.
Product Items are
A specific brand of a product line.
4 stages of product life cycles and marketing strategies are:
Introduction, Growth, Maturity, and Decline
Companies want it to be quick.
Companies want it to last as long as possible.
Companies still make good profits. Only the strongest brands make it to the maturity stage.
Company has to make a decision at what point do you get rid of it.