1. Product: Concept, importance & Classification
(chapter 7)
(3rd semester)
Product: Concept, importance & Classification

2. Meaning & Nature of Product
According to Philip Kotler, “A product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need”. A product may also be defined as a bundle of utilities consisting of various product features and accompanying services. The product may be a single commodity or a group of commodities which satisfy the needs and desires of the consumers. The product may be tangible, intangible, durables, non-durables, manufactured, semi-manufactured, consumer, industrial and an idea.

3. Essential features of Product
From meaning and definitions of product, we can draw the following essential features of a product:
Tangible attributes
Intangible attributes
Associated attributes
Exchange value
Customer satisfaction
Satisfaction of business needs
From these essential features of a product it is clear that product may be a physical product or a service.

4. Importance of product
Out of four elements of marketing mix, the product is the main element without which other elements have no role to play. The importance of product may be summarized as under:
Product is centre of all marketing activities
Starting point of marketing planning
Product is an end
Product is the key to market success
Satisfaction of corporate need
Competitive weapon
Importance from social viewpoint
Importance from consumer viewpoint
Importance from seller viewpoint

5. Product Concept
Products represent a bundle of expectations to consumer and society. Thus, product concept is the heart of marketing mix.
According to Prof. Theodore Levit, the product concept has three dimensions:
Managerial Dimensions
Consumer Dimensions
Social Dimensions
According to Philip Kotler’ “The product concept holds that consumers will favor those products that offer the most quality, performance and features”.s

6. Level of Product
A product has different levels each of which contributes to the total product image. These three levels of product are illustrated in the following diagram:
LEVELS OF PRODUCT
Augmented
Product
Actual Product
Core product
CORE BENEFIT

7. Product Classification
The commodity approach to the study of marketing gives us the two possible broad classification of products namely,
Traditional Product Classification
Modern Product Classification

8. Traditional product classification
The traditional classification is the most popular product classification, which divide the products into two major groups;
Consumer Products
Industrial Products
Traditional product classification may be illustrated as given below:
PRODUCT CLASSIFICATION
CONSUMER PODUCTS
INDUSTRIAL PRODUCTS
CONVENIENCE
PRODUCTS
SHOPPING PRODUCTS
SPECIALITY PRODUCTS

9. Industrial Products
Industrial products are those products which are used for further production of goods and services.
Thus, industrial products are meant for non-personal and business use. Industrial products are as follows:
Raw Material
Equipments: Equipment products are of three types:
Installations
Accessory equipments
Plant & Machinery
Fabricated parts and Materials
Operating Supplies

10. Differences between Consumer Products & Industrial Products
Consumer products and industrial products are two broad divisions of manufactured products
Following are some important differences among consumer products and industrial products.
Basis for differences are as:
Nature of customers
Number of Buyers
Nature of Demand
Extent of Market
Marketing Strategy
Product Analysis

11. Modern product Classification
Leo Aspinwall classify the products on the basis of five characteristics:
Replacement Rate
Gross margin
Adjustment
Consumption time
Searching time
On the basis of these five features Aspinwal classified the products in three colours:
Red products
Orange Products
Yellow Products

12. Product Classification o the basis of durability
On this basis products are classified as;
Durable Products
Semi-durable products
Non-durable products : These can be divided further into two parts:
(i) One time use products;
(ii) A few time use products

13. Thank You