Product and Product Mix Class 12
Meaning of Product
Product is anything that can be offered to a market to satisfy needs and wants of people. It can include physical goods, services, experiences, events, places, properties, organization, information and ideas.
The decision to make a purchase depends on the tangible attributes of the product as well as on the psychological attributes like brand, package, warranty, image or after sale service.
According to William Stanton, “Product is a complex of tangible and intangible attributes, including packaging, colour, price, prestige and services that satisfy needs and wants of people”.
Components of a Product
Products have their own identity or personality, providing satisfaction to users through various features and functions. Here’s a brief overview of the key components:
Core Product:
The basic element of the product. For example, with Dove Soap, the core product is the soap itself.
Associated Features:
Additional features that enhance the product's personality, like the fragrance, moisturizing ability, and color of Dove Soap.
Brand Name:
A unique name, term, or symbol that identifies the product and differentiates it from that of competitors.
Logo:
The brand mark or symbol that aids in brand recognition and recall.
Package:
Protects the product, provides information, and enhances sales appeal.
Label:
Part of the package providing written information about the product’s features, composition, and performance.
Together, these components contribute to the overall personality of a product, helping to meet and exceed customer expectations.
Characteristics of Product:
- Product is the core ‘P’ of marketing mix.
- Product is different for consumers; organizations and society have different needs and expectations.
- The product includes both good(tangible) and service(intangible).
- A marketer can realize their goals by manufacturing, selling, improving and modifying the product.
- It includes both tangible and non-tangible features and benefits offered.
- It is medium to offer benefits and satisfaction to consumers.
- The important lies in its utility and not ownership of product.
- Product includes total offers and after sale services.
Product and Product Mix Class 12
Importance of Product
Importance of the product lies in the following points:
- Core of Marketing
The product is the central focus of all marketing activities. Without it, efforts like selling, advertising, and distribution would be pointless. It also serves as a key measure of a firm's profitability.
- Basis for Planning
Planning for marketing activities such as pricing, distribution, and promotion starts with the product. The nature and demand of the product guide these plans.
- Customer Satisfaction
The main goal of marketing is to satisfy customer needs through quality products. High-quality products ensure longer market presence and customer satisfaction.
Product Levels
The marketer has to provide the customers with the best he can. He keeps on adding more and more in the benefits to be delivered to his customers, while earning for himself as well as fighting the competition in the market.
According to Levitt, a product offer can be made at four levels: the generic product, expected product, augmented product and the potential product.
However, different levels of product are given here:
- Core Product
Core product is the fundamental benefit or service that the customer buys e.g. for a car, the core product is transportation.
- Generic Product
Generic product is a basic version of the product containing only essential features e.g. a plain, no-brand soap bar or a packet of salt.
- Branded Product
Branded product is a product distinguished by a unique name or symbol e.g. Nike shoes.
- Differentiated Product
Differentiated Product is a product with distinct features or qualities that set it apart from the product of the competitors. E.g. Tesla electric cars, known for their innovative technology.
- Customized Product
Customized product is a product tailored to meet the specific needs or preferences of a customer e.g. Custom-built PCs where users select components based on their requirements.
- Augmented Product
Augmented Product is a product that includes additional features, services, or benefits beyond the core product e.g. Apple iPhone, which comes with warranty, customer service, and software updates.
- Potential Product
Potential Product involve all the enhancements and transformations a product might undergo in the future e.g. Future versions of smartphones that might include advanced features like holographic displays.
Today’s potential product can be tomorrow’s real product.
Product and Product Mix Class 12
Factors Affecting Product Mix
- Market Demand:
The level of demand for a product helps decide whether to make it or stop producing it. New products are launched when there’s a clear need identified in the market. If the demand is taking a downward trend, production should be discontinued.
- Cost of Product:
Companies can produce low-cost products to compete with high-priced ones. For instance, Nirma washing powder was introduced as a cheaper alternative to Surf.
- Quantity of Production:
If a new product is in high demand, a company can add more items to its product line and produce them on a larger scale.
- Advertising and Distribution Factors:
Adding new products to a product line often doesn't require extra advertising or distribution efforts. The existing setup can handle it.
- Use of Residuals:
By-products can be turned into new products. For example, sugar companies can use molasses, a by-product of sugar production.
- Competitor’s Action:
Companies may add or remove products from their lineup to stay competitive in the market.
- Full Utilization of Marketing Capacity:
If a company's marketing resources are underutilized, they can introduce a new product to make full use of these resources.
- Goodwill of the Company:
A company with a good reputation can easily launch new products because consumers already trust the brand.
Product and Product Mix Class 12
Some Product Terms / Product Decisions
Product Mix
Product Mix is the combination of all products offered by a company. It is three dimensional:
Breadth is measured by the number of products manufactured by a single manufacturer e.g. LG produces a variety of electrical gadgets such as television sets, washing machines, refrigerators etc.
Depth means the variety of sizes, colors and models offered within each product line e.g. LG manufactures different varieties or models of refrigerators and washing machines, etc.
Consistency is the close relationship of various product lines e.g. LG produces those goods which
fall under the category of electrical appliances.
Product Line
Product Line is a group of products that are closely related, on the basis of function, end sale or marketer or price etc.
Product Positioning
Product positioning means the way a product is offered to a particular customer of a particular segment to meet the customer's needs.
Check details Positioning the Product – Class 10
Product Repositioning
It means the way a marketer changes the whole product in order to satisfy a particular segment or customer.
Product Differentiation
Product differentiation is the modification of a product to make it more attractive for the target market, so that it is preferred to competitor’s product.
Three things are used for product differentiation: Product Quality, Product Design, and Product Support Services.
Product Diversification
Product Diversification means the product expansion either in the depth and/or in width. Depth means the variety of colors, sizes, designs, quality, stability etc., width means variety of products. e.g. Godrej Company used to manufacture cupboards, locks, safes, refrigerators etc. on a large scale but has now diversified into cosmetics, soaps etc.
Product Modification
Product modification is a deliberate change in the physical attributes of a product or its packaging to suit the changing demand e.g. Television manufacturers are bringing out certain modifications in order to suit the changing demand.
Product Standardization
Standardization means setting the limits of the number of varieties for uniform quality that can be manufactured and reduce unnecessary varieties e.g. Ready-made Shirts and Trousers are manufactured in standard sizes.
Product Elimination
Product Elimination means removing those products from the production/ marketing which cannot be improved or modified to suit the market needs and bringing some other profit making e.g. Maruti 800 was replaced by other cars by Maruti Suziki.