What is a Product

A pair of Adidas trainers, a Volvo truck, a Nokia mobile telephone, a Vidal Sassoon haircut, an Oasis concert, a EuroDisney vacation, advice from a solicitor and tax preparation services are all products. We define a product as anything that is offered to a market for attention, acquisition, use or consumption and that might satisfy a want or need. Products include more than just tangible goods. Broadly defined, products include physical objects, services, persons, places, organizations, ideas or mixes of these entities.

Services are products that consist of activities, benefits or satisfactions that are offered for sale, such as haircuts, tax preparation and home repairs. Services are essentially intangible and do not result in the ownership of anything. (Because of the importance of services in the world economy, we will look at them more closely in Chapter 15.)

Product planners need to think about the product on three levels. The most basic level is the core product, which addresses the question: What is the buyer really buying? As Figure 13.1 illustrates, the core product stands at the centre of the total product. It consists of the problem-solving services or core benefits that consumers seek when they buy a product. A woman buying lipstick buys more Elian lip colour. Charles Rcvson of Revlon saw this early: 'In the factory, we make cosmetics; in the store, we sell hope.' Theodore Levitt has pointed out that buyers 'do not buy quarter-inch drills; they buy qnartcr-ineh holes'. Thus when designing products, marketers must first define the core of benefits that the product will provide to consumers.

The product planner must next build an actual product around the core product. Actual products may have as many as five characteristics: a quality level, features, styling, a brand name and packaging. For example, Sony's Handycam camcorder is an actual product. Its name, parts, styling, features, packaging and other attributes have all been combined carefully to deliver the core benefit - a convenient, high-quality way to capture important moments.

Finally, the product planner must build an augmented product around the core and actual products by offering additional consumer services and benefits. Sony must offer more than a camcorder. It must provide consumers with a complete solution to their picture-taking problems. Thus when consumers buy a Sony Ilandycam, Sony and its dealers might also give buyers a warranty on parts and workmanship, free lessons on how to use the camcorder, quick repair serviees when needed and a freephone number to call if they have problems or questions. To the consumer, all of these augmentations become an important part ofthe total product.

Therefore, a product is more than a simple set of tangible features. Consumers tend to see products as complex bundles of benefits that satisfy their product

Anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a -want or need. It includes physical objects, services, persons, places, organizations and ideas.


Activities, benefits or satisfactions that are offered for sate.

core product The problem-solving services or core benefits thai consumers are really buying when they obtain a product.

actual product A product's parts, quality level, features, design, brand name, packaging and other attributes that combine to deliver core product benefits.

augmented product Additional consumer services and benefits built around the core and actual products.

Core Product And Augmented Product

needs. When developing products, marketers must first identify the core consumer needs that the product will satisfy, then design the actual product and finally find ways to augment it in order to create the bundle of benefits that will best satisfy consumers.

Today, most competition takes place at the product augmentation level. Successful companies add benefits to their offers that will not only satisfy, hut also delighc the customer. For instance, hotel guests find chocolates on the pillow or a howl of fruit or a VCR with optional videotapes. The company is saying 'we want to treat you in a special way'. However, each augmentation costs the company money, and the marketer has to ask whether customers will pay enough to cover the extra cost. Moreover, augmented benefits soon become expected benefits: hotel guests now expect cable television, trays of toiletries and other amenities in their rooms. This means that competitors must search for still more features and benefits to differentiate their offers.

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