Page 350 - Marketing Management

SETTING PRODUCT STRATEGY | CHAPTER 12 327

but also tape, shrink-wrap, and everything else needed to display or ship a customer’s final product. “It’s a
combination for survival,” says the company’s chief operating officer. “More customers want to call one
place for everything. We have to keep reinventing ourselves and form these kinds of relationships to
remain competitive.” 4

Product Classifications
Marketers classify products on the basis of durability, tangibility, and use (consumer or industrial).
Each type has an appropriate marketing-mix strategy. 5

DURABILITY AND TANGIBILITY Products fall into three groups according to durability
and tangibility:
1. Nondurable goods are tangible goods normally consumed in one or a few uses, such as beer
and shampoo. Because these goods are purchased frequently, the appropriate strategy is to
make them available in many locations, charge only a small markup, and advertise heavily to
induce trial and build preference.
2. Durable goods are tangible goods that normally survive many uses: refrigerators, machine
tools, and clothing. Durable products normally require more personal selling and service,
command a higher margin, and require more seller guarantees.
3. Services are intangible, inseparable, variable, and perishable products that normally require
more quality control, supplier credibility, and adaptability. Examples include haircuts, legal
advice, and appliance repairs.

CONSUMER-GOODS CLASSIFICATION When we classify the vast array of consumer
goods on the basis of shopping habits, we distinguish among convenience, shopping, specialty, and
unsought goods.
The consumer usually purchases convenience goods frequently, immediately, and with minimal Jamestown Containers is offering
effort. Examples include soft drinks, soaps, and newspapers. Staples are convenience goods con- additional packaging features to
sumers purchase on a regular basis. A buyer might routinely purchase Heinz ketchup, Crest tooth- provide more value to customers.
paste, and Ritz crackers. Impulse goods are purchased without any planning or search effort, like
candy bars and magazines. Emergency goods are purchased when a need is urgent—umbrellas dur-
ing a rainstorm, boots and shovels during the first winter snow. Manufacturers of impulse and
emergency goods will place them where consumers are likely to experience an urge or compelling
need to purchase.
Shopping goods are those the consumer characteristically compares on such bases as suitability,
quality, price, and style. Examples include furniture, clothing, and major appliances. Homogeneous
shopping goods are similar in quality but different enough in price to justify shopping comparisons.
Heterogeneous shopping goods differ in product features and services that may be more important
than price. The seller of heterogeneous shopping goods carries a wide assortment to satisfy individ-
ual tastes and trains salespeople to inform and advise customers.
Specialty goods have unique characteristics or brand identification for which enough buyers
are willing to make a special purchasing effort. Examples include cars, stereo components, and
men’s suits. A Mercedes is a specialty good because interested buyers will travel far to buy one.
Specialty goods don’t require comparisons; buyers invest time only to reach dealers carrying the
wanted products. Dealers don’t need convenient locations, although they must let prospective buy-
ers know where to find them.
Unsought goods are those the consumer does not know about or normally think of buying,
such as smoke detectors. Classic examples of known but unsought goods are life insurance, ceme-
tery plots, and gravestones. Unsought goods require advertising and personal-selling support.

INDUSTRIAL-GOODS CLASSIFICATION We classify industrial goods in terms of their
relative cost and how they enter the production process: materials and parts, capital items, and
supplies and business services. Materials and parts are goods that enter the manufacturer’s
product completely. They fall into two classes: raw materials, and manufactured materials and
parts. Raw materials fall into two major groups: farm products (wheat, cotton, livestock, fruits, and
vegetables) and natural products (fish, lumber, crude petroleum, iron ore). Farm products are
supplied by many producers, who turn them over to marketing intermediaries, who provide
assembly, grading, storage, transportation, and selling services. Their perishable and seasonal