UNIT 3 Product

Types of products
Consumer products
1. Consumer products, or business-to-consumer (B2C) products, are
sold to end-users and intended for personal use. The consumer
product category is commonly broken down further by purchasing
behavior — as different characteristics can influence the way
customers buy products. The table below explains the four major
consumer product types by purchasing behavior:
Purchasing Description
behavior
Convenience Convenience products are purchased frequently and with little planning or effort. They
are widely available, easy to obtain, and typically have a low price.
Example: Magazines, on-demand software and services

Shopping Shopping products are purchased less frequently than convenience products and have a
higher price. Buyers compare attributes such as quality, style, and price before making
a purchasing decision.
Example: Clothing brands, airline tickets

Specialty Specialty or niche products have features that appeal to a specific group of customers.
This type of product requires more targeted promotion to reach the right people.
Example: Vertical market software such as real-estate or banking applications

Unsought Unsought products have little awareness or proactive demand among customers.
Because customers do not perceive an immediate need for these products, the benefits
must be directly promoted to generate interest.
Example: Life insurance, reference books
Business products
• Business products, or business-to-business (B2B) products, help other
companies create their own products or operate their business.
Business products can also be referred to as horizontal market
products — present in multiple industries and supporting a wide
range of business needs. Examples of business products include raw
materials, equipment, supplies, business services, and software.
• Business software is a major sub-category of B2B products. Examples
include accounting, customer relationship management (CRM),
human resource management,
Industry products

• Industry products, or vertical market products, serve broad business

sectors such as energy, healthcare, financial services, or information
technology. Rather than cater to a large variety of use cases, industry
products are tailored to meet the needs of a specific industry
CUSTOMER VALUE HIERARCHY
• 1) Core Benefit – Its the most fundamental level wherein it encompasses the service or the
benefit that the customer is really buying. In this case, the core benefit for the Happy Meal is
food for the stomach in order to satiate hunger.
• (2) Basic Product – At this level the marketer must convert the core benefit into a basic
product. Thus a Happy Meal is in a way a combo-meal containing individual product offering of
McDonald’s. Its a burger & coke combo, with the intent to satisfy hunger and quench thirst.
• (3) Expected Product – At this level, the product has a set of attributes and conditions that
customers will normally expect while purchasing the product. McDonald’s has a reputation of
standardization and high quality assurance and thus customers expect that their Happy Meal
doesn’t taste different at different outlets and that their food is handled with the highest
degree of cleanliness and hygiene.
• (4) Augmented Product – The level in which the product exceeds customer expectations. For a
Happy Meal the free toy contributes at this level. Toys are changed on a periodic basis and are
often creative and interactive. McDonald’s ensures their quality, safety and suitability for
children.
• (5) Potential Product – This encompasses all the possible augmentations and transformations
that the product might undergo in the future. For the Happy Meal, healthier alternatives can be
introduced to replace the aerated beverage. The toys could get more creative, interactive and
also impart knowledge to the children instead of just remaining as a play thing.
Based on Durability there are three types of consumer products; namely, Non-
Durable Products, Durable Products, and Services.
I. Durable Product.:Durable goods are consumer goods that have a life span
of over three years and are used repeatedly over time. Bicycles and
refrigerators are considered durable goods. Consumer staples such as
food, beverage, personal hygiene, and clothing products are frequently
bought consumer goods
II. ii) Non-durable Product. :They may be defined as goods that are
immediately consumed in one use or have a lifespan of less than three
years. Examples of non-durable goods include cosmetics, cleaning
products, food, fuel, beer, cigarettes, paper products, rubber, textiles,
clothing and footwear.
III. iii) Services.: Services are intangible, value-added activities that a
company provides to its customers. They are the core of what a company
does to create value for its customers and generate revenue.