What Is A Product
What Is A Product
What Is A Product
- A product is anything offered for sale by a firm to buyers to satisfy their physical, social,
symbolic, and psychological wants and needs.
To maintain the interest of buyers, the physical products are most often provided with benefits like:
quality;
reputation of the manufacturer;
packaging:
credit;
information about the product:
warranty;
after sales service; and
deliver
Classification of Products
Consumer goods
Industrial goods
Consumer goods- are those intended for final consumption by consumers. They may be classified
according to;
THE RATE OF CONSUMPTION AND TANGIBILITY
Durable goods- are tangible goods which normally survive many uses.
Nondurable goods- are tangible products which are consumed in one or a few uses.
Services- are intangible goods like activities, benefits, or satisfactions which are offered
for sale.
The new unsought goods- are really new ideas or products that the consumer still have to know
to be motivated to buy
Regular unsought goods- are those that stay unsought but not unbought forever
Industrial Goods
-are those used in the production of other goods. They are categorized as follows;
1. Installations
2. Accessory equipment
3. Raw materials
4. Component parts and materials
5. Supplies
6. Services
Installations- This term refers to industrial products with long life, are generally expensive, and they
form part of the major capital equipment of an industrial firm.
Accessory Equipment- These are industrial goods that am used as aids in the production process. They
have a shorter usable life than installations.
Raw Materials- These are unprocessed goods that will become part of another product. Raw materials
are of two types
Farm products- are those grown by farmers.
Natural products- are those which occur by nature.
Component Parts and Materials- These are processed industrial goods that will still be used and
become an actual part of the finished product.
Supplies- These are items that are used as aids in the operating process but do not become part of the
finished product.
Licensing as an Alternative- a licensing agreement in which a firm who owns or controls a brand allows
another company to use it in exchange for royalties or payments.
Branding Strategies:
Manufacturer branding- a branding strategy in which the brand name for a product is
designated by the manufacturer. It has two alternative approach:
Multiproduct approach- referred to as blanket or family branding strategy, uses the
same brand name to cover a group of products.
Multi brand approach- requires the firm to provide each product with a distinctive
name.
Reseller branding- private labeling or private branding, refers to the branding strategy of a firm
which manufacturers products but sell them under the brand name of a reseller.
Mixed branding- use of manufacturer and reseller brands in a product.
Generic branding- which lists no product name and only the description of contents. Example:
rice, salt, charcoal.
PACKAGING
-refers to all activities involved in designing and producing the container or wrapper for a
product. The container or wrapper is the package. The package may include up to three levels of
material briefly described as follows
1. It provides protection to products before and after they are in the possession of the intended
users.
2. It provides convenience to the user.
3. It provides safety.
4. It provides economy to both the seller and the user.
5. It allows sellers to effectively promote the product.
LABELING
The part of the product which provides information about the product and the manufacturer is
called label.
Types of Labels
The brand label- This label identifies the product or brand.
The descriptive label- This label provides information about the product.
The grade label- This label identifies the products judged with a letter, number, or word like “grade A”,
“grade 3”, or “premium grade”.
The promotional label- This label provides attractive graphics to help promote the product.
Product Warranty
Product warranty- One of the product components that attracts customers to patronize a product is th
warranty, which is a statement explaining what seller promises about the product.
Variation Of Warranty
Express Warranties - are written statements of a manufacturer liabilities for product
deficiencies. Express warranty may be:
Limited-coverage warranty- is a manufacturer’s statement indicating the bound of
coverage and noncoverage of any deficiency found in the product.
Full warranty- is a statement of liability of manufacturer that has no limits of
noncoverage.
Implied Warranties - those that assign responsibility for product deficiencies to a manufacturer
even if the item was sold by a retailer.
Product Life Cycle
-Product, like human beings, have a life cycle which is referred to as the Product Cycle.
The Introduction Stage - in this stage the product is introduce to the public.
1. Slow growth of sales
2. Heavy promotional expenditures in relation to sales
3. Relatively high prices for the products
4. Limited product offering like limited variation in sizes, and color
The Maturity Stage - when the growth in sales slows down, the maturity stage begins to take
over.
1. Sales settle down
2. Price reductions are used as a tool of competition
3. Competition is intensified; and the market becomes saturated.