Product and Service Classifications
Products and services fall into two broad classes based on the types of consumers that use them: consumer products and industrial products. Broadly defined, products also include other marketable entities such as experiences, organizations, persons, places, and ideas'
Consumer Products
Consumer products are products and services bought by final consumers for personal consumption. Marketers usually classify these products and services further based on how consumers go about buying them. Consumer products include convenience products, shopping products, specialty products, and unsought products. These products differ in the ways consumers buy them and, therefore, in how they are marketed (see Table 8.1). Convenience products are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort. Examples include laundry detergent, candy, magazines, and fast food. Convenience products are usually low priced, and marketers place them in many locations to make them readily available when customers need or want them. customers compare carefully on suitability, quality, price, and style. When buying shopping products and services, consumers spend much time and effort in gathering information and making comparisons. Examples include furniture, clothing, used cars, major appliances, and hotel and airline services. Shopping products marketers usually distribute their products through fewer outlets but provide deeper sales support to help customers intheir comparison efforts.
Products and services fall into two broad classes based on the types of consumers that use them: consumer products and industrial products. Broadly defined, products also include other marketable entities such as experiences, organizations, persons, places, and ideas'
Consumer Products
Consumer products are products and services bought by final consumers for personal consumption. Marketers usually classify these products and services further based on how consumers go about buying them. Consumer products include convenience products, shopping products, specialty products, and unsought products. These products differ in the ways consumers buy them and, therefore, in how they are marketed (see Table 8.1). Convenience products are consumer products and services that customers usually buy frequently, immediately, and with minimal comparison and buying effort. Examples include laundry detergent, candy, magazines, and fast food. Convenience products are usually low priced, and marketers place them in many locations to make them readily available when customers need or want them. customers compare carefully on suitability, quality, price, and style. When buying shopping products and services, consumers spend much time and effort in gathering information and making comparisons. Examples include furniture, clothing, used cars, major appliances, and hotel and airline services. Shopping products marketers usually distribute their products through fewer outlets but provide deeper sales support to help customers intheir comparison efforts.
Specialty products are consumer products and services with unique characteristics or brand identification for which a significant group of buyers is willing to make a special pur-chase effort. Examples include specific brands of cars, high-priced photographic equipment, designer clothes, and the services of medical or legal specialists. ALamborghini automobile, for example, is a specialty product because buyers are usually willing to travel great distances to buy one. Buyers normally do not compare specialty products. They invest only the time needed to reach dealers carrying the wanted products.Unsought products are consumer products that the consumer either does not know about or knows about but does not normally consider buying. Most major new innovations are unsought until the consumer becomes aware of them through advertising. Classic examples of known but unsought products and services are life insurance, preplanned funeral services, and blood donations to the Red Cross. By their very nature, unsought products require a lot of advertising, personal selling, and other marketing efforts.
Industrial Products
Industrial products are those purchased for further processing or for use in conducting a business. Thus, the distinction between a consumer product and an industrial product is based on the purpose for which the product is purchased. If a consumer buys a lawn mower for use around home, the lawn mower is a consumer product. If the same consumer buys the same lawn mower for use in a landscaping business, the lawn mower is an industrial product. The three groups of industrial products and services include materials and parts, capital items, and supplies and services. Materials and parts include raw materials and manufactured materials and parts. Raw materials consist of farm products (wheat, cotton, livestock, fruits, vegetables) and natural products (fish, lumber, crude petroleum, iron ore). Manufactured materials and parts consist of component materials (iron, yarn, cement, wires) and component parts (small motors, tires, castings). Most manufactured materials and parts are sold directly to industrial users. Price and service are the major marketing factors; branding and advertising tend to be less important
Capital items are industrial products that aid in the buyer’s production or operations, including installations and accessory equipment. Installations consist of major purchases such as buildings (factories, offices) and fixed equipment (generators, drill presses, large computer systems, elevators). Accessory equipment includes portable factory equipment and tools (hand tools, lift trucks) and office equipment (computers, fax machines, desks). They have a shorter life than installations and simply aid in the production process
The final group of industrial products is supplies and services. Supplies include operating supplies (lubricants, coal, paper, pencils) and repair and maintenance items (paint, nails, brooms). Supplies are the convenience products of the industrial field because they are usually purchased with a minimum of effort or comparison. Business services include maintenance and repair services (window cleaning, computer repair) and business advisory services (legal, management consulting, advertising). Such services are usually supplied under contract.
Organizations, Persons, Places, and Ideas
In addition to tangible products and services, marketers have broadened the concept of a product to include other market offerings: organizations, persons, places, and ideas. Organizations often carry out activities to “sell” the organization itself. Organization marketing consists of activities undertaken to create, maintain, or change the attitudes and behavior of target consumers toward an organization. Both profit and not-for-profit organizations practice organization marketing. Business firms sponsor public relations or corporate image advertising campaigns to market themselves and polish their images. For example, food, agriculture, and industrial products giant Cargill markets itself to the public as a company that works closely with its business customers—from farmers and fisherman to fast-food restaurants and furniture manufacturers to help bring the world everything from heart-healthy milk and trans fat–free french fries to furniture and bedding foam created from renewable resources. It says in its ads, “This is how Cargill works with customers: “collaborate create succeed.” Similarly, not-for-profit organizations, such as churches, colleges, charities, museums, and performing arts groups, market their organizations to raise funds and attract members or patrons.
People can also be thought of as products. Person marketing consists of activities undertaken to create, maintain, or change attitudes or behavior toward particular people. People ranging from presidents, entertainers, and sports figures to professionals such as doctors, lawyers, and architects use person marketing to build their reputations. And businesses, charities, and other organizations use well-known personalities to help sell their products or causes. For example, Nike is represented by well-known athletes such as Kobe Bryant, Serena Williams, and hundreds of others around the globe in sports ranging from tennis and basketball to ice hockey and cricket. At the other extreme, Taylor Guitar markets a Baby Taylor model named after country pop superstar Taylor Swift, and Fender offers a John Mayer Stratocaster.
Industrial Products
Industrial products are those purchased for further processing or for use in conducting a business. Thus, the distinction between a consumer product and an industrial product is based on the purpose for which the product is purchased. If a consumer buys a lawn mower for use around home, the lawn mower is a consumer product. If the same consumer buys the same lawn mower for use in a landscaping business, the lawn mower is an industrial product. The three groups of industrial products and services include materials and parts, capital items, and supplies and services. Materials and parts include raw materials and manufactured materials and parts. Raw materials consist of farm products (wheat, cotton, livestock, fruits, vegetables) and natural products (fish, lumber, crude petroleum, iron ore). Manufactured materials and parts consist of component materials (iron, yarn, cement, wires) and component parts (small motors, tires, castings). Most manufactured materials and parts are sold directly to industrial users. Price and service are the major marketing factors; branding and advertising tend to be less important
Capital items are industrial products that aid in the buyer’s production or operations, including installations and accessory equipment. Installations consist of major purchases such as buildings (factories, offices) and fixed equipment (generators, drill presses, large computer systems, elevators). Accessory equipment includes portable factory equipment and tools (hand tools, lift trucks) and office equipment (computers, fax machines, desks). They have a shorter life than installations and simply aid in the production process
The final group of industrial products is supplies and services. Supplies include operating supplies (lubricants, coal, paper, pencils) and repair and maintenance items (paint, nails, brooms). Supplies are the convenience products of the industrial field because they are usually purchased with a minimum of effort or comparison. Business services include maintenance and repair services (window cleaning, computer repair) and business advisory services (legal, management consulting, advertising). Such services are usually supplied under contract.
Organizations, Persons, Places, and Ideas
In addition to tangible products and services, marketers have broadened the concept of a product to include other market offerings: organizations, persons, places, and ideas. Organizations often carry out activities to “sell” the organization itself. Organization marketing consists of activities undertaken to create, maintain, or change the attitudes and behavior of target consumers toward an organization. Both profit and not-for-profit organizations practice organization marketing. Business firms sponsor public relations or corporate image advertising campaigns to market themselves and polish their images. For example, food, agriculture, and industrial products giant Cargill markets itself to the public as a company that works closely with its business customers—from farmers and fisherman to fast-food restaurants and furniture manufacturers to help bring the world everything from heart-healthy milk and trans fat–free french fries to furniture and bedding foam created from renewable resources. It says in its ads, “This is how Cargill works with customers: “collaborate create succeed.” Similarly, not-for-profit organizations, such as churches, colleges, charities, museums, and performing arts groups, market their organizations to raise funds and attract members or patrons.
People can also be thought of as products. Person marketing consists of activities undertaken to create, maintain, or change attitudes or behavior toward particular people. People ranging from presidents, entertainers, and sports figures to professionals such as doctors, lawyers, and architects use person marketing to build their reputations. And businesses, charities, and other organizations use well-known personalities to help sell their products or causes. For example, Nike is represented by well-known athletes such as Kobe Bryant, Serena Williams, and hundreds of others around the globe in sports ranging from tennis and basketball to ice hockey and cricket. At the other extreme, Taylor Guitar markets a Baby Taylor model named after country pop superstar Taylor Swift, and Fender offers a John Mayer Stratocaster.
The skillful use of marketing can turn a person’s name into a powerhouse brand. Carefully managed and well-known names, including Oprah Winfrey, Martha Stewart, and Donald Trump, now adorn everything from sports apparel, housewares, and magazines to book clubs and casinos. Such well-known names hold substantial branding power. Consider the chefs on the Food Network. These days it’s hard to shop for kitchen products without bumping into goods endorsed by these culinary all-stars In an age when its chefs approximate rock stars, the Food Network is the ultimate launching ground for their endorsed products. Every chef offers a library of cookbooks, but it goes far beyond that.
Fans can cook just like their favorite Food Network guru by purchasing accessories to outfit their kitchens and a variety of essential signature flavors to stock their pantries. For example, Emeril Lagasse’s name peppers products such as his own spices (Bam!!) and a line of cookware from All- Clad. Giada De Laurentiis has her own spread of goods to create the perfect everyday Italian meal from cheese graters to pasta—available only at Target. “Good Eats” and “Iron Chef” host Alton Brown is a spokesperson for Welch’s and GE Appliances and has his own line of Shun knives. And Rachael Ray is a one-woman marketing phenomenon. Beyond her Food Network shows, she landed her own daytime talk show; endorses a litany of orange-colored cookware, bakeware, and cutlery; has her own brand of dog food called Nutrish; and brands her own EVOO (extra virgin olive oil, for those not familiar with Rayisms).
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