What is a product?

Anything of value that fulfils the requirement of the end-user is known as a Product. It can be goods or services,
tangible or intangible, physical or psychological. The customers and competitors largely depend upon the products
offered by the company.
Layers or Levels of Product

1. Core or Generic Product

It is the raw product that satisfies the customer’s primary need. The core product is at its raw form, not
bearing any brand name and remains undifferentiated.
For example: – Wheat is a grain that one can consume.
2. Basic Product
The core products differentiated from the rest become the basic product. It adds some necessary features to
the products like Brand Name, Packaging and Label, etc.
For example: – Fortune Chakki Fresh Atta (wheat flour).
3. Expected Product
These products include the key features that customers look forward to. It also contains standard
features that a product should have.
For example: – Chapati is prepared from wheat flour.
4. Augmented Product
To differentiate products from competitors, companies add distinctive features to them. These additions
depend on the market survey conducted for the product. They try to create a Unique Selling Proposition
(USP) for their products.
For example -Brown Bread and Cookies.
5. Potential Product
It refers to all the possible features that a product can have in the future. These features depend on the market
conditions and economic changes.
Major Product Decisions
The major product decisions, which are also the types of product decisions, are discussed briefly below:

1. Core or Generic Product

It is the raw product that satisfies the customer’s primary need. The core product is at its raw form, not
bearing any brand name and remains undifferentiated.
For example: – Wheat is a grain that one can consume.
2. Basic Product
The core products differentiated from the rest become the basic product. It adds some necessary features to
the products like Brand Name, Packaging and Label, etc.
For example: – Fortune Chakki Fresh Atta (wheat flour).
3. Expected Product
These products include the key features that customers look forward to. It also contains standard
features that a product should have.
For example: – Chapati is prepared from wheat flour.
4. Augmented Product
To differentiate products from competitors, companies add distinctive features to them. These additions
depend on the market survey conducted for the product. They try to create a Unique Selling Proposition
(USP) for their products.
For example -Brown Bread and Cookies.
5. Potential Product
It refers to all the possible features that a product can have in the future. These features depend on the market
conditions and economic changes.
Major Product Decisions
The major product decisions, which are also the types of product decisions, are discussed briefly below:

New Product Decision

A new product incorporates the elements of newness and varies from the existing ones. It may include new features,
qualities or be introduced differently. Besides, adding new products can result in growth, profitability, increased
market share and more.
To remain profitable and maintain sales, organizations need to launch new products. However, the products may fail,
so the marketers must take new product decisions wisely.
The product decisions may include:

1. Original Product
2. Improved Product
3. Modified Product
4. Development of Product
5. Launching Products, etc.
Product Mix
It refers to the aggregate range of products that a company owns. In other words, the total number of products that a
company offers for sale is the product mix of the company.
Product mix decisions depend upon the following four characteristics:
1. Length
2. Width
3. Depth
4. Consistency
There are various decisions the marketers have to take regarding the product mix. It may include:-
1. Expansion
2. Contraction
3. Product Differentiation
4. Deepening and Alteration, etc.
Product line
This refers to a range of closely-related products belonging to the same class. They are sold to the same customers,
having identical attributes marketed by the same distribution channel but for different segments.
The product decision relating to a product line are:
1. Line Stretching
2. Line Filling
Design
It indicates the appearance or personality of the product. The marketers have to decide whether to go for
the standard design or the creative design.
Changing the product’s design may be effective but can be risky too. The customer may or may not like the design
and face problems while using the product.

Branding
Branding is one of the vital decisions taken under product decisions. It involves the visual and symbolic elements of
the product.
Branding helps in monitoring the Brand Image, Loyalty and Acceptance.
The marketers distinguish the product using:
1. Band Name
2. Trade Marks
3. Logo
4. Brand Marks, etc.
Packaging
Packaging is the outermost covering of the product. It enables product protection, conveys information and creates
sale appeal. And is not restricted to just the safety of the product.
Packaging has evolved as the medium of marketing. Marketers use packaging to reposition or renovate their
products.
Packaging decisions include:
1. Size
2. Design
3. Innovation
4. Aesthetics
5. Convenience
6. Material
7. Environmental factors
Labelling
The label is a part of the packaging. It contains all the essential details about the product in written form. Also, it
conveys information regarding performance, features, quality and price, etc.
The marketers must perform an in-depth analysis at the time of Labelling. It is a medium of communicating with
customers. Vital decisions based on labelling are:
1. Brand Label
2. Descriptive Label
3. Grade Label
4. Informative Labels
Positioning
Positioning builds a unique image of the product in the target audience’s mind. Also, it differentiates products from
others using benefits and attributes in the customer’s mental space.
The product decision concerning positioning are:
1. Segmentation
2. Differentiation
3. Aggregation
Support
Support or Customer Support is the company’s added benefit for the customers. It may be offered to the end-user by
after-sale services, grievances management, and so on. It assists in creating loyal customers and recurring sales.
Different customer support services possess varied cost structures. Therefore, marketers must make decisions
to reduce costs and improve customer experience.

Product Marketing Ethics

Product marketing ethics is a minor term than Marketing ethics. The marketers must pay attention to the following
ethical issues while marketing:
  Deceitful Practices: The marketers often put faulty or low-quality products for sale without informing
customers. They also ask for additional charges in the name of customer services.
The customers acknowledge it while consuming and are left with no other option than to pay for it.
 Ecofriendly Products: The companies must carry out production considering the statutory guidelines for
pollution control. The product must not harm the environment at any stage, from production to post-
consumption.
The marketers should convey instructions on the packaging about product disposal.
 Quality Products: The companies should produce quality products and disclose complete details. They
should contain important information like ingredients, uses and precautions.
Also, the packaging must mention all the areas of concern related to the product.

Product Development

Definition: Product development refers to the creation of a new product which has some utility; or up-gradation of
the existing product; or enhancement of the production process, method or system. In simple words, it is all about
bringing a change in the present goods or services or the mode of production.

In simple terms product development comprises of the following elements:

 Creation and Innovation pave the way for new inventions and generation of a new product which provides
utility to the consumers.
 Improvement of the existing products is essential to upgrade the old products and to attain perfection.
 Enhancement of the existing production process, methods, techniques and system helps in the betterment of
customer experience. It is more cost-efficient for the organization too.
For Example; One of the most popular electronic brands Sony came up with the idea of coloured television in the
year 196o. Sony, with its new product development, has given a modern edge to the technological advancement in the
entertainment world.
Content: Product Development
1. Identifying the Need
2. Process
3. Conclusion
Identifying the Need for Product Development
Have you ever wondered; Why is the change needed in organizations? Why do the companies keep on modifying
their ways? What makes companies invest a tremendous amount in research and development?
To answer these questions, let us go through the following reasons for which companies plan for product
development:

Slow or Static Product Growth

When the company notices a downfall in the product performance regularly, which is not due to change in the
economy or other factors which are beyond control, it should inspect the product line to find out the reason.
Pressure to Lower the Product Price
A business which is controlled merely by the price factor may land nowhere. If a company encounters that the
customers are shifting to the competitors’ product due to the price factor and land up cutting down the prices of its
product, it must opt for product development.
Diminishing Business from the Most Valuable Customers
The company finds out that its high revenue-generating customers prefer the competitor’s product over its product.
Then, it must analyze the change in the customer’s demand and the features offered by the competitor’s product to
meet that requirement.
Decrease in Inquiries by Prospective Customers
A product itself has the capability of acquiring customers. If the product becomes obsolete or unworthy for its buyers
and is unable to attract inquiries from the potential customers, the company must consider product development.
Rise in Salesforce Turnover
When it becomes difficult for the sales team to sell a particular product to the customers, they tend to grab better
opportunities in other companies. This leads to salesforce turnover. It signifies that something is wrong with the
product due to which it is being rejected in the market.
Entry of New Competitor with Innovative Product
A new competitor enters the market and successfully acquires the company’s prevailing market share. The company
needs to analyze that the competitor’s innovative product is providing a higher level of satisfaction to the customers,
which the company’s product failed to do.
Change in Customer’s Demand
When the company finds out that the customers are frequently demanding a particular change in the product or
seeking for some additional feature which the competitor is offering at the similar price, it should look forward to
product development.
Competitors Exit the Market
Sometimes, many competitors leave the market since they have sensed the downfall. At this point, the company must
look up to product development to retain the customers through innovation.
Product Development Process
Product development is a strategic approach. It should be well planned and systematically executed to achieve desired
results and avoid loss.
Given below is the step by step process for introducing a new product in the market:

Idea Generation: The first step is knowing customer’s requirement through market research by taking feedback,
conducting surveys and going through the competitor’s product. From this research, a product idea is developed.
Idea Screening: The product idea is to be well studied and investigated to find out the need for introducing the new
product, the requirement of additional machinery, selection of marketing channel and its break-even point.
Concept Testing: The next stage is enquiring about the product feasibility by conducting concept testing. The new
product idea is revealed to a group of consumers, and they are asked to share their response over it. If the majority is
in favour of the product, then further steps are to be taken.
Business Analysis: In this step, the organization decides whether the product is financially viable for it or not.
Product’s demand, cost, competitiveness, profitability, expected sales, overheads, etc. are analyzed.
Product Development: At this stage, the manufacturing of a new product, it’s financing, marketing and distribution
as well as advertisement and promotion takes place. However, initially, a small quantity is produced as a test batch.
Test Marketing: The product is then launched in the market on a small scale. If it attains success and can generate
customers, the large-scale production is planned.
If the product is rejected in the market, the company finds out the shortcomings and rectifies it. If the product fails
again in the market, the company tends to dump it.
Commercialization: At this point, the company executes large-scale production and distribution of the successful
new product. It advertises and markets the product on a massive scale to acquire a considerable customer base.
Review Market Performance: Lastly, the company keeps track of the product’s performance in the market to know
customer satisfaction level, demand, profitability, sales volume, competitor’s strategy, the satisfaction of the
middlemen involved, etc.
Conclusion
Product development is essential for the growth of all; the business, the consumers and the economy. No business can
survive the competition without adding the element of innovation to its product line.
Developing a successful product for the consumers require a lot of brainstorming, planning, research, trials and
rectification.