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Goods and Services

Czinkota, Michael R., Ronkainen, Ilkka A., and Donath, Bob The goods and services continuum enables mar-
(2004). Mastering global markets: Strategies for today’s trade keters to see the relative goods/services composition of
globalist. Mason, OH: Thomson/Southwestern.
total products. A product’s position on the continuum, in
Global economic integration. (n.d.). Retrieved February 22, turn, enables marketers to spot opportunities. At the pure
2006, from About.com Web site: http://economics.about.
goods end of the continuum, goods that have no related
com/od/useconomichistory/a/global.htm
services are positioned. At the pure services end are serv-
Hill, Charles W. L. (2006). Global business today (4th ed.).
Boston: McGraw-Hill/Irwin. ices that are not associated with physical products. Prod-
ucts that are a combination of goods and services fall
What is global economy? Retrieved February 7, 2006, from PR
Resource Center Web site: http://www.ailins.com/agency/PR/ between the two ends. For example, goods such as fur-
unions/global_economy.html naces, which require accompanying services such as deliv-
ery and installation, are situated toward the pure goods
end. Products that involve the sale of both goods and
G. W. Maxwell
services, such as auto repair, are near the center. And
products that are primarily services but rely on physical
equipment, such as taxis, are located toward the pure
services end.
GOALS AND
The second approach to categorizing products is to
OBJECTIVES classify them on the basis of their uses. This organization
SEE Management: Authority and Responsibility facilitates the identification of prospective users and the
design of strategies to reach them. The major distinction
in this system is between consumer and industrial prod-
ucts. Consumer goods and services are those that are pur-
GOODS AND SERVICES chased for personal, family, or household use. Industrial
Goods and services are the outputs offered by businesses goods and services are products that companies buy to
to satisfy the demands of consumer and industrial mar- make the products they sell.
kets. They are differentiated on the basis of four character- Two major changes have affected the marketing and
istics: production of goods and services since about 1950. The
first was a shift in marketing philosophy from the belief
1. Tangibility: Goods are tangible products such as
that consumers could be convinced to buy whatever was
cars, clothing, and machinery. They have shape and
produced to the marketing concept, in which consumer
can be seen and touched. Services are intangible.
expectations became the driving force in determining
Hair styling, pest control, and equipment repair, for
example, do not have a physical presence. what was to be produced and marketed. This change in
orientation has resulted in increases in both lines of prod-
2. Perishability: All goods have some degree of durabil-
ucts and choices within the lines.
ity beyond the time of purchase. Services do not;
The second change was an increased demand for
they perish as they are delivered.
services. The growth in demand for services—and result-
3. Separability: Goods can be stored for later use. Thus, ing production—continues to increase at a faster rate than
production and consumption are typically separate. the demand for manufactured goods.
Because the production and consumption of services
are simultaneous, services and the service provider SEE ALSO Marketing
cannot be separated.
4. Standardization: The quality of goods can be con- BIBLIOGRAPHY
Bearden, William O., Ingram, Thomas N., and LaForge, Ray-
trolled through standardization and grading in the
mond W. (2007). Marketing, Principles and Perspectives.
production process. The quality of services, however,
Boston: McGraw-Hill/Irwin.
is different each time they are delivered.
Evans, Joel R., and Berman, Barry (2002). Marketing: Marketing
For the purpose of developing marketing strategies, in the 21st Century (8th ed.). Cincinnati, OH: Atomicdog-
Publishing.Com.
particularly product planning and promotion, goods and
services are categorized in two ways. One is to designate
their position on a goods and services continuum. The Earl C. Meyer
second is to place them into a classification system. Matthew F. Hazzard

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