What is a Product?
Product is any item that is offered by the marketer to the consumer for satisfying their needs and wants. When we use the term product it includes both good and service. It is the means through which service is provided to the customer and has a range of benefits both physical and psychological. A product has its own identity and personality.
Product is a component of the marketing mix. Basically, decisions regarding all other components of the marketing mix, are based on the ‘product’. Let’s say Price is decided for the product, Promotion efforts are made to advertise and sell the product, and lastly, a distribution network is also created for making the product available to the customers easily. Hence, it has a critical role to play in deciding the success of the marketing efforts.
Here, it must be noted that the importance of the product lies in the benefits and services provided by the product and the product itself. For instance, We do not buy Television, but we actually buy entertainment services.
Therefore, a product must serve the purpose, i.e. satisfy the need or want for which it has been bought, as a tangible product is just the medium, while the real value lies in the service provided by the product.
Components of Product
The main components of a product are:
- Core Product: It is the basic constituent of the product which covers the key components i.e. contents, quality, utility, and benefits.
- Product Features: Apart from the core constituent, there are other associated features that the product contains, such as its fragrance, shape, size color, texture, branding, packaging, labeling, and variant. One must note here that product features do have not much value unless they do not provide any benefits to people, i.e. it is the benefits that contribute to the customer value.
- Brand Name: A brand can be a name, trade market, symbol, design, text, or a combination of all these, which adds a distinctive identity to the product, from the rest of the products available in the market.
- Logo: A logo is a symbol, which is a key element of the product, and the brand too. It helps the customers to recall and identify the marketer of the product. It helps in simplifying the process of communication to the user.
- Package: The package is the outside covering of the product. It gives protection to the product, stores the item, communicates the message or information, and adds a sales appeal. However, the main reason for adding a package is to protect the product from getting contaminated or broken.
- Label: Labelling is the main part of a package. It is that written textual information that you see on the face and back of the product, that helps the consumer in understanding the nature, features, steps to use, contents, and everything else about the product.
Characteristics of Product
A product characterized by:
- A product is an important part or element of the marketing mix. The entire marketing campaign depends on it.
- Different people perceive products in different ways.
- It is a carrier of consumer value.
- It includes both goods and services.
- The goals of the marketer can be realized when the product is produced, sold, improved, and modified.
- Product refers to the complete bundle which is sold to the consumer and includes branding, packaging, labeling, color, etc.
- It is a medium that satisfies consumers’ wants and needs.
- The value of a product lies in the service provided by the product and not in its physical form.
Levels of Product
A product is created to satisfy the needs of the customers. However, there is no product offered by the company which stands at the base level of the need satisfaction, as the firm takes it to improved levels by adding a number of inputs to make it a more advanced version of the base product such as features, functions, distinctive brand name, innovative packaging, reasonable price, creative promotion, etc. Moreover, the reputation of the company also adds value to the product.
As per Levitt, a product can attain four levels – Generic or Core Product, Expected Product, Augmented Product, and Potential Product. But to simplify the understanding of the product evolution, a six-level approach is given hereunder:
A generic product or core product is a non-specific i.e. unbranded and undifferentiated product. It is the product in its raw and original form. Rice, bread, flour, pulses are some common examples of these products. At this level, the product has no brand name associated with it and so it is not recognized by a specific brand or marketer.
The branded product is one that gets an identity with a name. At this level, the marketers add a certain level of quality and additional features, and attractive packaging to lure customers, give it a proper label, along with the brand name like Dawat Basmati Rice, Popular bread, Sampurna Atta are some examples of branded products. These products generally come in a packaged form.
Generally, all branded products are presumed as differentiated products, however, this is not always the case. A differentiated product is one that gets the benefit of differentiation, i.e. uniqueness from other similar products or brands existing in the market.
At this stage, the marketer adds certain special attributes and qualities to the product that claims distinctiveness. The differentiation claimed could be tangible, like some special ingredient, improvement in quality, utility or it may be intangible i.e. psychological.
Nutrela High Protein Chakki Atta and Diabexy Atta Sugar Control for Diabetes is an example of a differentiated product.
A product tailored according to the requirements of the particular customer is called a customized product. Banking and accounting software are good examples of such products. They are customized to a great extent.
The augmented product is the outcome of voluntary improvements introduced by the firm with an aim of adding value to the product. And firm keeps working on providing such benefits which are beyond the expectations of consumers. For this purpose, market research is conducted by the marketer, to understand the way in which the value of the product can be improved and new and advanced features are added to the product.
At this level, competition takes place between products offered by different marketers. Titan clocks, Google maps, Colgate motion, Aristocrat luggage, etc. are some examples of augmented products.
Products for tomorrow is a potential product, which brings all the improvements and artistry which can be added under the existing technological, economic, and competitive conditions.
At this stage, the company adds exclusive features in their products which are so far not offered by any other company. Hence, they search for new and innovative means of satisfying customers and add a unique identity to them. It is the strength of large corporates, as huge investments in research and development, machinery and equipment, and human resources are required.
Flying Cars and Humanoid Robots are classic examples of potential products.
As the product progresses from generic to potential level, two things take place, the addition of more value and differentiation at each subsequent stage, which makes the product stronger than before.
A product is not just an object, rather users of the product associate meaning with the product and they derive satisfaction by consuming them.