Marketing Management Text and Cases Product Concepts
10
Chapter
Product Concepts
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Product Concepts
A product is anything, tangible or intangible, which can be offered to a market for attention, acquisition, use, or consumption that might satisfy a need or want.
Thus, a product can be a physical entity (e.g., computer, shirt, or soap), some service (e.g., healthcare, tuition, or bank), a retail store (e.g., music store, locality grocer, or supermarket), a person (e.g., a singer, physician, or politician), an organisation (e.g., business organisation, trade organisation, or not-for-profit organisation), a place (e.g., village, city, or country), or idea (e.g., social issues, concepts, or population control). We use the word product innumerably in everyday life. SHH Kazmi, 2007
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Product Concepts
Product is any thing that can be offered to a market to satisfy a want or need. Products that are marketed include physical goods, services, experiences, events, persons, places, properties, organizations, information, and ideas. A product mix (also called product assortment) is the set of all products and items that a particular seller offers for sale.
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For example : Kodaks product mix consists of two strong product lines: information products and image products. A companys product mix has a certain width, length, depth, and consistency.
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Width:
The width of the product mix refers to how many different product lines the company carries. HUL has different product lines. It offer different products for the consumers. The product lines offered by HUL are home and Personal care, Food and Beverages and Industrial, Agricultural and others.
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Length:
The length of a product mix refers to the total number of items in the mix.
This is obtained by dividing the total length by the number lines. Procter and Gamble offers different product line width.
It offers different brands under detergents like Tide, Ariel.
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Depth: The depth of a product mix refers to how many variants are offered of each product in the line. Hindustan Unilever Limited offers tooth paste named Close Up at different sizes like 20 grams, 50 grams, 150 grams etc. In this case
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Consistency: The consistency of the product mix refers to how closely related the various product lines are in turns of the end use, production requirements, distribution channels, or some other way. P&Gs product lines are consistent in so far as they are consumer goods that go through the same distribution channels.
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Product Concepts
WIPRO : Software, Hardware, Soaps, Baby Care, Cooking media, lighting and Medical equipments MODI : Cements, Tyres, Cigarettes, Telecom equipments, Cellular service, Paper products, Hardware and Office Automation equipments
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Product Concepts
A product can be described at five levels: The first level is the core benefit The second level is a generic product The third level is the expected product The fourth level is the augmented product The fifth level is the potential product
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Product Classification
Products can be grouped under one of the two general categories. Consumer products are those that we buy for our personal or family use or consumption. Organisational products represent those products that firms and institutions buy to produce other products, to resell, or to run day-to-day operations.
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Consumer Products
Based on durability and tangibility, there are three categories:
Durable goods
Non-durable goods
Services
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Product Concepts
The most widely used approach to classifying consumer goods puts them under four categories: Convenience Products Shopping Products Specialty Products Unsought Products
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Product Concepts
Organisational Products
Organisational or industrial goods can be classified into seven categories based on their characteristics and intended use: raw materials, capital equipment,
accessory equipment,
component parts, process materials,
consumable supplies and
industrial services.
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Product Concepts
Product Line and Product Mix
Product item, product line, and product mix concepts help us understand the relationships among a companys different products. A product item refers to a particular version of a product that is distinct, such as Surf Excel is a (premium) product item offered by Hindustan Lever Limited. A product line is a closely related group of products for essentially similar use, and technical and marketing considerations. Product mix is the total number of products that a company markets.
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Product Concepts
Line Stretching
Downward Line Stretch Upward Stretch Both-Way Stretch Line Filling
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Product Concepts
New Product High Price Present Product High Price New Product High Price Present Product
Low
New Product
Low
Present Product
Low
New Product
Low Quality
High
Low Quality
High
Low Quality
High
Downward Stretch
Upward Stretch
Both-Way Stretch
Line Stretching Decisions
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Line Pruning
Line pruning is just the opposite to line stretching and involves a deliberate decision to cut down the number of items in product line(s).
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Product Mix Decisions
Most business entities have many products in their portfolio. By dealing in many products, companies aim to serve a much larger and varied group of customers who look for solutions to different types of needs. Companies make decisions concerning product mix based on competitive situations, existing or emerging market opportunities, and changes in consumer lifestyles and preferences.
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