The Psychological theory of the product says that "We do not buy products, but what they can do for us. " Sometimes a certain consumer does not acquire a luxury vehicle, for transport or mobility reasons, but for factors related to the image and prestige that this product can provide.
If we buy a computer, what are we buying? A box, a monitor plus a keyboard and mouse? Or a product that is capable of helping us in our work, speeding up processes and tasks? Or an article to play?
We therefore deduce that the product concept is not so simple and that a careful analysis is necessary for a better understanding.
1. PRODUCTS AND SERVICES
In some cases it is difficult to understand whether or not a service is a product. For this we will adhere to the following categories:
- Tangible products.
- It is a certain good that we can physically recognize, that we can touch and see. A car, a video camera, a can of sardines etc.
- They are those in which they do not physically intervene when we carry out the purchase action. Insurance can offer us a service that meets a number of needs, but the means you will use to achieve it are not. Services may be; an account at a bank, a training course, life insurance, a cleaning company, an agency etc…
One of the most significant differences between the two is that the tangible product gives me the possibility to try it before making the purchase, while a service, we must make sure that it will be able to satisfy our needs, also because of the confidence we have in the company, for references etc.
When we buy a tangible product, we buy what we want. When we buy an intangible product we buy a promise.
Goods are produced, services are performed.
2. TYPES OF PRODUCT
Products can be generically classified into:
- CONSUMER PRODUCTS INDUSTRIAL PRODUCTS SERVICES
INDUSTRIAL PRODUCTS
- Immediate consumption (tobacco, press, food) Durable consumption (Decoration, clothing, real estate) Specialized consumption (Appliances, automobiles, jewelry…)
INDUSTRIAL PRODUCTS
- Raw materials Semi-finished products Industrial equipment Auxiliary materials (Detergents, lubricants…)
SERVICES. INTANGIBLE AS A PRODUCT
3. CHARACTERISTICS AND ATTRIBUTES OF THE PRODUCT
These are the characteristics to take into account at the time of marketing:
Physical Attributes:
- Composition, organoleptic qualities and ultimately all those perceptible by the senses.
Functional Attributes:
- (Physical attributes can also be functional) Color, taste, smell Assortment Size, packaging, and packaging Labeling Design
Psychological Attributes:
- The quality The brand
4.1 The Brand
A brand is called the name under which we market a product to differentiate it from others.
The logo is the graphic expression of the brand.
The brand:
- It allows to differentiate our product from the competition It facilitates the acquisition of the product It facilitates repetitive purchase It facilitates advertising It facilitates the introduction of new products
Conditions that a brand must meet:
- Must be simple and short Easy to read and pronounce Easy to recognize and remember Product-associated Must be euphonic (sound good) Distinct from the competition Must be internationalizable Potentially recordable
Classes of Trademarks:
- Single brand (Sony, Hitachi, Philips..) Individual brands. When we assign a different brand to each product, regardless of the name or brand of the company, multiple brands. Also called second brands. For example, Philips sold televisions under the Philips brand and under the Radiola brand, and refrigerators under the Philips brand and Ignis brand. Also called white marks. These are products with the Caprabo, Día or Continente brand but which are made by other manufacturers that use other brands.
The packaging
The packaging, initially, was conceived to Protect and Present the product. However, the usefulness of the container is much greater from a marketing point of view.
Utilities:
- Protects the product Helps with the sale of the product Act of claim Facilitates the use of the product Facilitates product recognition Helps with promotion
In some cases, packaging has been developed that, from an ethical point of view, we could say that they are not too correct. For example: Shampoo or gel containers, with unbalanced points of equilibrium, that is to say, they tend to fall easily and therefore a significant part of the product is wasted. The same is the case when the opening or the mouth of the container is too large and disproportionate.
Labeling
- It allows to identify the characteristics and composition of the product It facilitates the sale and management as well as the control by the distributor In some cases the label has to meet certain legal requirements regarding the information it must contain.
The quality
The term quality is usually used with some lightness and also ambiguously, both by customers and by sellers.
When you talk about quality in marketing, you don't usually talk about technical quality. In most cases the consumer does not have the necessary information to understand the technical quality of a product.
Quality is more of a question of consumer perception. Quality demands a standard of comparison. When we say that a quality product, mentally we are making a comparison with another product that we consider standard.
The question would be Quality, with respect to what?
What do we generally understand by Quality?
- THE CHALLENGE OF MAKING THINGS RIGHT AT THE FIRST SET OF THAT THAT MEETS THE NEEDS OF THE RECIPIENT (THE CUSTOMER) THE SET OF CHARACTERISTICS OF A PRODUCT OR SERVICE THAT HAS THE ABILITY TO MEET THE NEEDS OF THE CUSTOMER
The best quality is
THE ONE THAT SATISFIES THE REQUIREMENTS SPECIFIED BY THE BUYER, AT THE LOWEST COST TO HIM.
QUALITY DEFINITIONS
- ADEQUACY WHEN USING MEETING SPECIFICATIONS A PREDICTABLE DEGREE OF UNIFORMITY AND RELIABILITY AT LOW COST AND SUITABLE TO THE NEEDS OF THE MARKET QUALITY IS WHAT THE CUSTOMER IS WILLING TO PAY, DEPENDING ON WHAT THEY OBTAIN AND THE QUALITY OF THE PRODUCT IS THE MINIMUM COST THAT THE LOWEST COST OF THE PRODUCT IS.
DIFFERENT CONCEPTS OF QUALITY
EUROPEAN CONCEPTION: «ABILITY TO SATISFY ANY EXPRESSED OR IMPLIED NEEDS»
THE JAPANESE CONCEPTION ENVELOPS CUSTOMER SATISFACTION WITH THE COMPANY'S INTERNAL OBJECTIVES:
Product line decisions:
- Width: Product lines manufactured by the company Length: Total sum of the products marketed by the company Depth: Variations of each of the products Consistency : Homogeneity that the various products maintain among themselves.
4. THE PRODUCT LIFE CYCLE
Every product goes through different stages over time.
The stages are as follows:
- Introduction Growth Maturity Decline
Characteristics of each stage:
- Introduction:
Initially low sales volume
Few outlets
High costs due to product launch (Advertising, R&D, etc.)
Innovative buyers
Low production at high cost
Negligible benefit from high costs
Advertising aimed at first users
Unimportant competition
- Increase
Strong increase in production and decrease in costs
The first competitors begin to appear
Profit at its highest level due to high prices and growing demand
Advertising aimed at the mass of the market
- Maturity
Many competitors for few segments
Decrease in profit from the action of the competition
Highly competitive prices
Intensive distribution
Advertising used to differentiate the product
Stability and stagnation of sales
- Slope:
No investment
The product begins to not satisfy the needs of our consumers
Product about to disappear
Sales drop
Advertising aimed at reducing stocks. Increase in promotions
Selective distribution
Percentage of consumers who usually buy in each phase:
- Innovators 2.5% Early Adapters 13.5% Early Majority 34% Late Majority 34% Laggards 16%
Innovators and early adapters buy in the introduction stage and
growth respectively.
Early and late majority in the maturity stage.
Laggards in the decline stage.
What should we take into account before canceling a product?
May?
Apply to other uses?
Adapt?
Expand?
Modify?
To be replaced?
Recombine?
Decrease?
Invert?
Etc…
5. LAUNCH OF NEW PRODUCTS
Process for the development and commercialization of new products:
- Identify the opportunity Product design Pilot market testing Modifications made by the test Marketing Feedback Feedback
Every product must arise to satisfy a certain need of our target market.
This means that before its launch and even conception, we must analyze and study the market in order to detect what its desires, deficiencies and needs are. Starting from this base, we will begin to design products that are capable of satisfying them.
A starting point for the launch of new products would be:
- Detect a need Detect a deficiency Detect a deficiency. New applications of old products Changes in society
- Surveys aimed at our clients or potential clients Group discussions Market studies Benchmarketing or comparative studies with other competing companies Ideas from our own staff
The original idea must be materialized in a specific product. With its characteristics, attributes, qualities, design, packaging, prices, etc.
Determine both the income and the expenses of the new product launch.
Definition: Positioning
Positioning is used to:
- Differentiate the product Associate product-desired attributes
We are interested in knowing which is the attribute of our product that our consumers value best in order to focus our efforts on reinforcing them and not other attributes that the consumer does not consider so important.
Likewise, we must compare our best attribute with the competition in order to know our positioning. We will also determine the most appropriate strategy to achieve our goal in the event that the current positioning is not the one that interests us the most.
4 Steps in the Positioning Methodology
- Identify the best Attribute of our product Know the position of competitors based on the attributes identified Decide our positioning according to our competitive advantages Communicate our positioning to the market. Advertising.
A simple system to assess your own attributes and those of your competition would be to use a table like the following:
| Attributes | Our product | Competitor A | Competitor B |
| Brand | 5 | 7 | 4 |
| Container | 7 | 6 | 9 |
| Packaging | 4 | 8 | 8 |
| Quality | 8 | 4 | 6 |
| Design | 4 | 7 | 7 |
| Odor | 3 | 4 | 7 |
| Taste | 6 | 5 | 5 |
| Total | 33 | 41 | 46 |
We can change the attributes and add the ones we want to compare.
The score for each attribute is established from 1 to 10 and gives us an overall assessment of our product compared to the competition.
In the previous example, we can see that even though we have a lower score, we stand out in Quality, so our strategy could be aimed at strengthening and communicating this attribute to our market.
- Factors related to the product Factors related to distribution Factors related to prices Factors related to advertising and promotion
- QualityVersatilityMake it uniqueOrganoleptic characteristicsContainerPackagingBrandWarrantyCompetence
- Current sales force and availability Existing distributors Distribution channels to be used Commissions to intermediaries Stock policies Transport methods and techniques Logistics Storage Costs
- Finished product costs Variable costs Direct and indirect costs Fixed costs Pricing policy Prices and margins Payment methods
- Development of the advertising campaignContacts with agencies and mediaAdvertising aimed at the client or consumerAdvertising aimed at intermediaries (Wholesalers, retailers…) DemonstrationsAwardsSamplesManuals
