Classification of Products/ Services

Goods used by consumers for personal, family, or household purposes. Examples: shampoo, notebook paper, picture frame, etc.

Consumer Products

Activities purchased by a consumer for personal or family purposes. Examples: haircut, carwash

Consumer Services

Convenience goods - Inexpensive products that require little time and effort on the purchase decisions and are purchased regularly.

Staple goods - Used often/regularly and are kept on hand. Examples: bread, toilet paper

Impulse goods - Unplanned purchases. Examples: magazine or candy in a grocery store check-out aisle

Emergency goods - Purchased to satisfy an immediate need. Example: Medicine purchased on the way to a sporting event to sooth a headache.

Classifications of Consumer Products/Services

Shopping goods - Products that usually require a great deal of time and effort for the purchase decision. Consumers search and compare similar products prior to purchase.

Clothing items and hardware or appliances are often considered shopping goods.

Classifications of Consumer Products/Services

Specialty goods - Sought by a consumer who desires a specific brand or product. The consumer will not accept a substitute. The consumer may have saved money for long period of time before purchasing or may have to borrow money to purchase.

Examples: Rolex watch, house, boat.

Classifications of Consumer Products/Services

Pure services: Activities performed that do not include a tangible product.

Non-good services - Personal/professional service for a fee. Example: tax preparation.

Owned-good services - Activities that alter, improve, or repair products already owned. Example: dry cleaning, appliance repair service.

Rented-good services - Provide a product to use for a brief period for a fee. Example: carpet cleaners, movie rental.

Classifications of Consumer Products/Services

Product related services - Activities offered with or to compliment a product. Examples: warranties, alterations.

Classifications of Consumer Products/Services

Industrial goods - Goods purchased by a business to produce other goods or to resell to consumers. Examples: assembly line machinery, rubber

Industrial services - Activities used by a business to insure proper operation, or contracted by a business to perform a task. Examples: Copier or cleaning services for a business

Installation and accessory equipment - Part of the production process used to make products.

Examples: assembly line machinery, industrial sewing machines

Raw materials, components, fabricated parts - Consumed to produce a product or become part of the final product.

Examples: wood for paper, wheat for bread

Classifications of Industrial Products/Services

Industrial supplies - Support or facilitate the use of industrial goods of the operation of the business. Examples: computers, cash registers,

Maintenance and repair - Cleaning, repairing, painting, or decorating that is performed for or by a business. Example: janitorial services

Classifications of Consumer Products/Services

Business advisory - Management consulting, legal, engineering, or accounting performed for or by a business.

Classifications of Consumer Products/Services

Elements of the Product Mix

Includes all the different products that a company makes or sells.

•Product Line

•Product Item

•Product Width

•Product Depth

Product Mix Strategies

• Deep mix - Many items offered in the same line; meets many needs. Example: Procter & Gamble makes several types of Crest toothpaste.

• Shallow mix - Few items offered in the same line; specializes in meeting certain needs. Example: Croc only has a limited selection of shoe styles.

Product length or depthProduct length or depth

Product Mix Strategies

• Narrow mix - Limited number of product lines; focuses on a specific target market. Example: Zaxby’s only offers chicken dishes.

• Broad mix - Many different product lines offered; focuses on one-stop shopping to meet many needs and wants. Example: Applebee’s or Chili’s has lots of meat dishes from which to choose.

Product width or breadthProduct width or breadth

Product Mix Strategies

• The plan for how the business determines which products it will make or stock

• May develop completely new products• May expand or modify their current

product lines• May drop existing products

Elements of the product mix

Product consistency

The relationship of a business’s product line offerings in terms of use, price range, target market, and methods of distribution and production.

Importance of Product/Service Planning and Mix

• Competition - “”Beating” the competition; increasing the market share.

• Direct competition – Same product is offered by like competitors. McDonald’s and Burger King are direct competitors

• Indirect competition – Competitors offer similar or substitute products. Bath & Body Works and CVS are indirect competitors.

Business must always be aware of what new products are available as well as what their competitors are offering.

Importance of Product/Service Planning and Mix

Changes in the Market

– Observe changes in the product life cycle.

– Observe changes in consumer preferences and trends.