Download Actual product

- BY :- SEEMA SINGH, AVINASH
PATHAK , SUDEEP SINGH &
AKSHIT GARG
 We
would like to thank Dr. Priyank Azad for
giving us this assignment that helped us in
having a better understanding about what
does product actually means. Without his
guidance this would have not been possible.
 What
is product ?
 Three levels of product
 Importance of levels of product
 Classification of product
 Product life cycle
 Any
tangible or intangible offerings that is
perceived as a bundle of benefits by the
customers and attempts to satisfy their
unsatisfied needs
 Core
product
 Actual product
 Augmented product
 The
terms “Core product” and “Actual
product” have a very slight differentiation
between them but it is vital that marketers
understand this difference. Only by defining
your core product clearly, you can achieve
marketing excellence. Core product is also
known as benefits and is general intangible
in nature. Lets take an example.
 Supposing you are planning on launching your
own car manufacturing unit. What would be
your core product? Would it be the car itself?
NO. The core product would be convenience
to your customers.
 The
Actual product is the one which is
manufactured after a decision has been
taken on what your core product is going to
be. These products are quantifiable in nature
and have properties like color, branding,
quality etc. For example
 if your core product is a status symbol like
BMW, your actual product will be a very high
quality product with high pricing.
 The
Augmented product, as the name
suggests, arise by themselves and are by
products of the core and actual products.
These might be complete products within
themselves. Again taking the above example,
if you are manufacturing a car, it needs
regular servicing, warranty etc. Thus these
become tertiary products or augmented
products. There are business which are
dedicated completely in providing
augmented products such as service centers,
AMC centers etc.
These three product levels play a vital part in
product management and are also important
while deciding the marketing mix of a
company. This is mainly because, if there
was an augmented product attached to the
actual product, then the promotions, placing
and pricing of even these augmented
products needs to be decided. Thus product
decisions are generally the primary decisions
of the marketing mix.
ON THE BASIS OF PRODUCT
CHARACTERISTICS :DURABILITY,
TANGIBILITY AND USE (consumer or
industrial )
(1) NON-DURABLE
(2) DURABLE
(3) SERVICES

These are tangible goods normally
consumed in one or few uses eg: soap,
shampoo. Because these goods are
consumed quickly and purchased frequently,
the appropriate strategy is to make them
available at many locations, charge only a
small mark up and advertise heavily to
induce trial and build preference.

These are tangible goods that normally
survive many uses. Normally require more
personal selling and service, command a
higher margin , and require more seller
guarantees. Eg : refrigerators , machine tools
,and clothing
 These
are intangible, inseparable ,
perishable and variable products. Normally
require more quality control, superior
credibility, and adaptability. Example :- hair
cuts, legal advice and taxation services
ON THE BASIS OF CUSTOMER SHOPPING
HABITS :
(1) CONVENIENCE GOODS
(2) SHOPPING GOODS
(3) SPECIALTY GOODS
(4) UNSOUGHT GOODS




are goods that the customer usually
purchases frequently, immediately, and with
a minimum of efforts.
(A) Staples: Consumers purchase on a
regular basis.
(B) Impulse Goods: are purchased without
any planning or search efforts.
(C) Emergency Goods: are purchased when a
need is urgent.



are goods that the customer , in the process
of selection and purchase, characteristically
compares on such basis as suitability,
quality, price and style.
(A) Homogeneous Shopping Goods: are
similar in quality but different enough in
price to justify shopping comparisons.
(B) Heterogeneous Shopping Goods: differ in
product features and services that may be
more important than price.

are goods with unique characteristics or
brand identification for which buyer is willing
to make a special purchasing effort.

are goods the consumer does not know
about or does not normally think of buying.
These goods require advertising and
personal selling support.
Sales and
Profits ($)
Sales
Profits
Time
Product
Development
Introduction
Growth
Losses/
Investments ($)
19
Maturity
Decline
 The
stage 1 is where the product is launched.
A product launch is always risky. You never
know how the market will receive the
product. There have been numerous failures
in the past to make marketers nervous during
the launch of the product. The length of the
introduction stage varies according to the
product.
 Higher
investments, lesser profits
 Minimal competition
 Company tries to induce acceptance and gain
initial distribution
 Company needs promotions targeted towards
customers to increase awareness and
demand for the product
 Company needs promotion targeted towards
channel to increase confidence in the
product
 Once
the introductory phases are over, the
product starts showing better returns on
investment. Your customers and channels
begin responding. There is better demand in
the market and slowly the product starts
showing profits.
 This is a stage where competition may step
in to squash the product before it has
completely launched. Any marketing
mistakes done at this stage affect the
product considerably as the product is being
exposed to the market and bad news travels
fast.
 Product
is successfully launched
 Demand increases
 Distribution increases
 Competition intensifies
 Company might introduce secondary
products and support services
 Better revenue generation and ROI
One of the problems associated with maturity
stages in a technologically advanced
environment is the problem of duplication.
 Along with competition, Penetration pricing
becomes a weapon for competitors. Competitors
sell products with the same features at lesser
prices thereby trying to penetrate in the market.
 Along with competition, Penetration pricing
becomes a weapon for competitors. Competitors
sell products with the same features at lesser
prices thereby trying to penetrate in the market.

 Competition
is high
 Product is established and promotion
expenditures are less
 Converting customers product to your own is
a major challenge in maturity stage
 Little growth potential for the product
 Penetration pricing, and lower profit margins
 The major focus is towards extending the life
cycle and maintaining market share
1
product, 10 competitors, minimum profits,
huge amount of manpower and resources in
use – A typical scenario which a product
might face in its last stage. In this stage the
expenditures begin to equal the profits or
worse, expenses are more than profits.
 Thus it becomes a typical scenario for the
product to exit the market. It also becomes
advantageous for the company as the
company can use resources it was spending
on the declining product on an altogether
different project.
Market is saturated
 Sales and profits decline
 Company becomes cost conscious
 A lot of resources are blocked in rejuvenating
the dead product.
 There are only three options left with the
company




Re positioning or Rebranding of the product to extend
product life cycle
Maintain the product as it is and reduce costs to get
maximum profits till the product can produce profits
Take the product off the market.
 Facts
taken in this presentation are from one
of the best websites for marketing i.e.,
marketingteacher.com and marketing91.com