What is Product?
Any thing which can satisfy customers, made according to their needs, expectations and preferences can be called as a product. A product can be defined as a bundle of attributes that satisfies a customer demand.
From the above definitions it is cleared that:
It is a need satisfying entity.
It is a transferable asset.
It has a utility and capacity to satisfy human needs/ wants.
It is a result of process of manufacturing.
It has an exchange value.
“A Product is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need. It includes physical objects, services, persons, places, organizations and ideas”.
“ A product is a set of tangible attributes includes packaging, colour, price, quality and brand plus the services and reputation of a seller. A product may be a good, service, place, person or idea.
Classification of products
1. ON BASIS OF DURABILITY
1.Durable
2.Non-durable
2. ON BASIS OF TANGIBILITY
1.Tangible
2.Non-tangible
3. Consumers goods
1. Convenience goods
a. Staple b. Emergency
c. Impulse
2.Shopping goods
a. homogeneous b. heterogeneous
3. Specialty goods
a. unsought goods
4. INDUSTRIAL GOODS
1. Materials and spare parts.
2. Capital items.
3. Supplies and business services.
Components/ levels of product
Core product
Tangible product / Actual product
Expected product
Augmented product
Potential product
Product mix decisions
WIDTH
LENGTH
DEPTH
CONSISTENCY
Product mix decisions
Expansion of product.
Contraction of product.
Alteration of existing product.
New uses of existing product/ positioning the product.
Trading up and trading down.
Product differentiation.
Product line decisions.
1. Increasing the line strength/ product line expansion.
a. Line stretching.
1. Stretching up
2. Stretching down
3. Stretching both ways
b. Line filling.
2. Product Line contraction (line pruning)
3. Product line modernization
New product development
MEANING:
New product development means introducing a new product in the market.
OR
It is adding a new product to the existing product line of the company.
Booz, Allen & Hamilton had identified 6 categories of new products.
New to world products.
New product line.
Additions to the existing product lines.
Improvement & revision of existing product.
Repositioning.
Cost reduction.
Product development involves :
1. Technological and other development.
2. Profit maximization.
3. Innovation or product modification.
Why product development is needed ?
1. Meeting the growing needs of consumers.
2. Pressures from environmental changes.
3. Earning more profit.
4. Extending the product line.
5. Expansion of business.
Steps in new product development/ process.
1.Generating new product ideas/ discovery of product with promising marketing prospects.
2. Idea screening.
3. Concept testing.
4. Business analysis & market analysis/ feasibility study.
5. Actual development of a new product/ product development.
6. Market test.
7. Test marketing.
8. Commercialization/ large scale (commercial) production.
PRODUCT LIFE CYCLE
A Product introduced in the market by a firm has to move through different stages of growth till the product goes out of the market.
According to Philip Kotler,
“The product life cycle is an attempt to recognize distinct stages in the sales history of the product”.
INTRODUCTION
GROWTH
MATURITY
DECLINE
WITHDRAWAL
Any thing which can satisfy customers, made according to their needs, expectations and preferences can be called as a product. A product can be defined as a bundle of attributes that satisfies a customer demand.
From the above definitions it is cleared that:
It is a need satisfying entity.
It is a transferable asset.
It has a utility and capacity to satisfy human needs/ wants.
It is a result of process of manufacturing.
It has an exchange value.
“A Product is anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or a need. It includes physical objects, services, persons, places, organizations and ideas”.
“ A product is a set of tangible attributes includes packaging, colour, price, quality and brand plus the services and reputation of a seller. A product may be a good, service, place, person or idea.
Classification of products
1. ON BASIS OF DURABILITY
1.Durable
2.Non-durable
2. ON BASIS OF TANGIBILITY
1.Tangible
2.Non-tangible
3. Consumers goods
1. Convenience goods
a. Staple b. Emergency
c. Impulse
2.Shopping goods
a. homogeneous b. heterogeneous
3. Specialty goods
a. unsought goods
4. INDUSTRIAL GOODS
1. Materials and spare parts.
2. Capital items.
3. Supplies and business services.
Components/ levels of product
Core product
Tangible product / Actual product
Expected product
Augmented product
Potential product
Product mix decisions
WIDTH
LENGTH
DEPTH
CONSISTENCY
Product mix decisions
Expansion of product.
Contraction of product.
Alteration of existing product.
New uses of existing product/ positioning the product.
Trading up and trading down.
Product differentiation.
Product line decisions.
1. Increasing the line strength/ product line expansion.
a. Line stretching.
1. Stretching up
2. Stretching down
3. Stretching both ways
b. Line filling.
2. Product Line contraction (line pruning)
3. Product line modernization
New product development
MEANING:
New product development means introducing a new product in the market.
OR
It is adding a new product to the existing product line of the company.
Booz, Allen & Hamilton had identified 6 categories of new products.
New to world products.
New product line.
Additions to the existing product lines.
Improvement & revision of existing product.
Repositioning.
Cost reduction.
Product development involves :
1. Technological and other development.
2. Profit maximization.
3. Innovation or product modification.
Why product development is needed ?
1. Meeting the growing needs of consumers.
2. Pressures from environmental changes.
3. Earning more profit.
4. Extending the product line.
5. Expansion of business.
Steps in new product development/ process.
1.Generating new product ideas/ discovery of product with promising marketing prospects.
2. Idea screening.
3. Concept testing.
4. Business analysis & market analysis/ feasibility study.
5. Actual development of a new product/ product development.
6. Market test.
7. Test marketing.
8. Commercialization/ large scale (commercial) production.
PRODUCT LIFE CYCLE
A Product introduced in the market by a firm has to move through different stages of growth till the product goes out of the market.
According to Philip Kotler,
“The product life cycle is an attempt to recognize distinct stages in the sales history of the product”.
INTRODUCTION
GROWTH
MATURITY
DECLINE
WITHDRAWAL