Products:
People satisfy their needs and wants with goods and services. The term product is used to cover both. A product is defined as anything that can be offered to satisfy a need or want.
The importance of physical products lies not so much in owning them as in obtaining the services they render. A car is not bought just for its appearance but because it supplies transportation services . A Microwave oven is not just bought to admire but because it supplies a cooking services.
Thus physical products are really vehicles that deliver services to us.
In fact , services are also supplied by other elements , such as persons , places , activities , organizations , and ideas. Generally the term product is used to cover physical products , service products , and other things that are capable of delivering satisfaction of a want or need.
Manufacturers often make the mistake of paying more attention to their physical products than to the services produced by these products. They see themselves as selling a product rather providing a solution to a need. Yet a woman isn’t buying lipstick ; she is buying “hope”. A carpenter isn’t buying a drill ;he is buying a “hole”. A physical object is a means of packaging a service. The marketer’s job is to sell the benefits or services built into physical product s rather than just describe their physical features.
VALUE , COST , AND SATISFACTION:
How do comsumers choose among the many products that might satisfy a given need?
Assuming that a person needs to travel eight km a day to work a number of products could satisfy this need: a bicycle , a motorcycle , an automobile , an auto , and a bus. These alternatives constitute his product choice set. The person may also consider other factors ,namely speed , safety , ease , and economy . These are called his need set . Now each product has a different capacity to satisfy his various needs. Thus a bicycle will be slower , less safe , and more effortful than an automobile , but it will be more economical. The person has to decide which product will deliver the most total satisfaction .
The guiding concept is customer value. The person would arrive at an estimate of the capacity of each product to satisfy his set of needs.He might rank the product from the most need-satisfying to the least need-satisfying . Value is the consumer’s estimate of the product’s overall capacity to satisfy his or her needs.
Suppose the person is primarily interested in the speed and ease of getting to work. Since each product involves a cost , he will not necessarily buy the automobile. The automobile costs substantially more than , say , a bicycle. The person will have to give up more of other things (represented by the cost ) to obtain the car. Therefore , he will consider the product’s value and price before making a choice. He will choose the product that will produce the most value for the money he is paying.