Product classification

Product classifications:

·         In terms of durability and tangibility:
1. Non-durable goods: they are tangible goods normally consumed in one or few uses like beer and soap. Because these goods are consumed quickly and 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: they are tangible goods that normally survive many uses for example refrigerators, clothing etc. durable products normally require more personal selling and service, command a higher margin, and require more seller guarantees.
3. Services: they are intangible, inseparable, variable and perishable products. As a result they normally require more quality control, superior credibility, and adaptability. Examples include haircuts, legal advice, etc.

Products can be further classified according to their ultimate use. They can be

1.       Consumer product

2.       Industrial product

·         Consumer Product: they are bought to satisfy personal and family needs. They are bought by final consumer for consumption. The vast array of goods consumers buy can be classified on the basis of shopping habits. We can distinguish among convenience, shopping, specialty, and unsought goods.

I.                    Convenience products: it comprises goods that consumer purchase frequently, immediately, and with a minimum of effort. Consumer goods can be further divided. Staples are goods consumers purchase on a regular basis such as a toothpaste. Impulse goods are purchased without any planning or search effort for instance chocolates. Emergency goods are purchased when a need is urgent.

Features:
-purchased immediately and frequently in low quantities

-purchase effort is minimal and unplanned, low involvement purchase

-brand awareness is high but brand loyalty is low

-price is usually low

ii.   Shopping products: they are goods that the consumer in the process of selection and purchase characteristically compare on such bases as suitability, quality, price, and style. Examples include furniture, cars etc. they generally are of durable types. They are purchased after consideration of alternatives regarding price, quality and style. Shopping goods can be further divided. 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

Features:
-purchased less frequently and consumed slowly
-considerable purchase effort is needed in planning and making the purchase.
-price is usually high
-brand awareness and loyalty is low

iii. Specialty products: they have unique characteristics or brand identification for which a sufficient number of buyers are willing to make a special purchasing effort. They are products of durable types with unique features. Consumers have strong brand preference and loyalty. They are expensive products. Examples include Rolex, BMW, Nikon, Pierre Cardin suits, Mont Blanc
Features
-purchased infrequently
-purchase is well planned. Consumers spend substantial time and effort in locating the brand
-there is strong brand loyalty. Consumers do not accept substitutes.

IV. Unsought products: they are products that the consumers do not know or do not normally think of buying. They have little product awareness and knowledge. Examples include life insurance, cemetery plots.
Features:
-purchased rarely
-no purchase planning. No buying efforts made

Industrial products: they are bought for business use or to make other products. The examples are raw materials, capital items, supplies and services. We can distinguish three groups of industrial goods: materials and parts, capital items, supplies and business services.

·         Materials and parts: they are goods that become part of the final product. They are goods that enter the manufacturers’ product completely.

Features

-raw materials consists of natural products and farm products. They change their form to become final product

-parts enter finished products without change

·         Capital items

They are long lasting goods that facilitate production of the finished product. They consist of installations and accessory equipment
Features

-installation consist of building, machinery and equipment. They are non-movable, expensive and long lived. They affect the scale of operations. They remain fixed in one place

-accessory equipment consist of movable equipment’s, tools and office equipment. They help in production process. They have a shorter life span

·         Supplies and services

They are goods and services that facilitate developing and managing the finished product. They consist of operating supplies and services.
Features:

-operating supplies are consumable and industrial goods. They are low cost, short-lived and frequently purchased. Examples are fuel and stationery. They are the convenience goods of industries.

-business services are support services and consist of repair and maintenance and advisory services.