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The Product Layers

Discuss about the Importance of Product Layers and Product Components.

When an entrepreneur or a customer thinks about the product, they perceive it in different layers. Like let's take an example of a car, the customer will probably think of factors like the look, driving experience and much more. However, a product is much more than these features (Krebs et al., 2010). The report will try to understand different layers of products and how an entrepreneur presented it in the market. The concept of three level of product comes in picture when organizations reach the stage of finalizing the product or when a product is analyzed from different angles. It is important to understand here that just like an organization; product to follow a hierarchy system (Krebs et al., 2010). A product, therefore, can be divided into three layers. This layer is actually based on serried of different features and advantages which assist the organization in segmenting the market and further helps in targeting and positioning of the product.  This is why; three layers of product are those who assist in defining the product in a perfect manner (Krebs et al., 2010).

The focus of the marketer is to discover the preference of the consumer for different advantages and at the same time will also match a single feature that can add to the choice. This is why; there are so many professionals in the field of marketing and sales who ask so many questions to understand customer and then there are some novice salespersons who only concentrate on demonstrating the product (Burroughs., 2011).  

The overall concept of three level of the product helps when one can easily finalize the product or when the customer wanted to analyze the product. So like any business, a product also follows the hierarchy. A product can also be divided on three level which consists of different kind of factors and advantages that helps the product to segment, target and then position as per customer demand (Hammack et al., 2011). In other words, these three levels of product help the manager to define the product in a more efficient manner.

Core product: the core product or actual product has a very light distinction between them, and it is important that any marketing manager clearly understands the difference. It is important here that only by explaining the core product correctly; an organization can achieve excellence in marketing. The core product is also crucial, and their advantages and other features are intangible by nature (Porter and Heppelmann, 2014). For example, if an organization is planning to launch a product like say a car manufacturing unit. So the main question now that what should be the core product and will it be car only or anything else. The answer here is no because core product here would be connected with the convenience of the consumers. The consumer has many options for transportation like bus or taxi which can help him to reach the destination. (Hammack et al., 2011). However, when the customer prefers options like cars, they are giving preference to convenience, and there are so many times when they are looking for a status. Therefore, the core product for companies like Tata cars will be based on convenience and also the value for money on the other hand when a consumer choose a BMW; it will be their status symbol (Porter and Heppelmann, 2014).

Following are three layers and their detailed explanation:

Actual product: the real product is something that is produced once the core product is decided by the company. Therefore, from the example discussed in the core product, if the core product is a convenience, the actual product decision will be a comfortable or value for money car (Jayal et al., 2010). In this, the product is related to a status symbol and the manufacturing will be based on luxury with high quality. The actual product can be easily quantified and also have certain features like branding, quality or color and much more.

Augmented product: the augmented product is something that comes into existence and is connected by-products that are both core and actual products. This might be a finished product within them (Hugstad and Durr, 2015). Like for example, it the organization is manufacturing a car then it needs regular service and warranty and much more. Therefore, mastering these features will bring the organization into a territory of that product, or it may also be called as augmented products. Some organizations are entirely dedicated to providing expanded product like service centers or AMC centers (Jayal et al., 2010). Also, it is important to remember that there three level of product that is not just necessary for the Tangible product but intangible products or services as well. Like for example, in a software company, the core product will be better functions in the form of operations and efficient management for the customers (Hoyer et al., 2010). Here the actual product will be based on multiple factors related to the organization for which any software is required and need to program accordingly. Here the augmented product will be built on the maintenance of the software and timely update of the same. This is why, even the service product here have three levels, and these three levels of the product are very crucial especially for the management of the product and are also crucial while taking any decision in the marketing mix of the company (Brennan and Owende, 2010). This is actually because of an augmented product that is related to the actual product, and then there is promotion and placing the product or service in a proper manner with right pricing for the same. Therefore, product decisions are normally the initial decisions in the marketing mix cycle (Brennan and Owende, 2010).

Level of Marketing

Following is the detailed discussion of components of product planning:

The Product Components Concept

Generation of the idea: - this process is a continuous process where is constant and at the same time systematic search for new kind of opportunities for the product. It consists of new sources for ideas and different ways to generate new ideologies and ideas. There are different sources of ideas like employees, competitors, channel members and customers (Bosch and Bosch-Sijtsema, 2010). At the same time, there are various methods through which different ideas can be generated that include market survey, brainstorming and different kind of avenues as well (Varadarajan, 2010).


Product Screening:
- there are potential and good ideas for a product, which are important to be tested and scrutinized from time to time. Here product screening method can be poor and can also have different unsuitable ideas that are not considered for various actions in future. It is important that each idea must weigh against a list or a checklist. It must be weighed on the scale of 1 to 10 where one is outstanding, and ten are poor. Here every attribute related to production and marketing of a product must be tested before taking right decision (Varadarajan, 2010).

Concept testing: testing of the concept is done with the consumers and for this, it is important to have a product that can successfully measure the overall attitude and at the same time intuition at a very early stage while launching a new product and planning process around it (Kuhfeld and Tobias, 2012). Testing of concept should be quick and at the same time an inexpensive process. This way companies can also access and take advantage of the enthusiasm of the consumers. This process of testing the concept should approach potential customers and react to the surveys like responding to the picture or description of product through written and oral communication (Kuhfeld and Tobias, 2012).

Business Analysis: Business analysis consist of many types of reviews, evaluation and in the end projection of many features that customers desires. It consists of productions costs, break-even points, capital investment and profitability for every potential product and the next step here is the overall experience and product development which can be very time-consuming and critical at the same time (Papadopoulos and Heslop, 2014). 

Development of product: in product development cycle, there should be an idea for any new product that can easily be converted into a form which is tangible and it also consists of basic strategy for marketing (Lähteenmäki et al., 2010).

Three Products Components and Explanation

Test marketing: in this step, a developed product is placed in one or more area or zones in a place. After profound observation, the actual performance is evaluated along with a proposed marketing plan (Lähteenmäki et al., 2010). The overall aim is to test the product viability and at the same time also plan all the marketing efforts in a more real setting with the proper product launch. It is also important to test marketing that needs many decisions at the same time like when and where to test the product or what should be the duration of the test and what all is required to a test and much more (Krebs et al., 2010).

Commercialization: this is the last stage in fundamental product concept and this stage the product is introduced to the target audience by looking at entire production. Marketing also needs a large investment which should be timely planned, and there must be a long-term commitment (Krebs et al., 2010).

New product development here will be based on the consumers taste and preferences for advantages over characteristics by basing the research on some needs. New product development focuses on addressing the needs and also satisfying the customers. NPD also can deliver the product that can offer multiple advantages at core, actual and in the end augmented level (Kotler and Armstrong, 2010). New product development may also provide a different kind of replacement product in the present time, and it can add multiple products to the current line of goods. At the same time it can also discover a new kind of product lines, and also it can deliver very innovative and right products which the whole world might not have experienced before (Kotler and Armstrong, 2010).

There can so many reasons behind launching a new product and changes in the legal aspect can mean that companies are forced to design and also develop a new kind of product (Kotler, 2012). For example, technology has completely changed the market in different categories like there was a time when videotape recorder was in a fashion which moved to digital and then to DVD recorders (Hultén, 2011). This is why the product will have to modify as per the changing demand of the target audience. There are times when the company will have to increase the volume of the production and also deliver the product by running to its entire capacity. A perfect example which can be taken here is the food manufacturers of tinned products that operate a 24/7 and it also designs a different kind of derivatives of the products to lower the overall cost per unit in production (Storbacka, 2011). Therefore product lines can be extended, and the main reason will be based on easing the efficiency at the operational level. Also, there is a very intense rivalry in the market that will also result in new product development. For example, a smartphone and how quickly products like this go through product life cycles and complete life-cycle (Gummesson, 2011).

Conclusion

Change is an only constant thing in the market and when a change occurs in any feature of the marketing mix will impact new product development. For example, there is a trend to shop everything on the internet, and there are certain products that have to be distributed through online stores, and this product will be adapted to make it as compact as possible and also it is important to make the delivery process simple (Chen et al., 2011). New product development can influence tastes and preference of customers that will force the company to adapt the products and services for the local or global market.

Reference

Krebs, F.C., Fyenbo, J. and Jørgensen, M., (2010). Product integration of compact roll-to-roll processed polymer solar cell modules: methods and manufacture using flexographic printing, slot-die coating and rotary screen printing. Journal of Materials Chemistry, 20(41), pp.8994-9001.

Hammack, R., Imrich, W. and Klavžar, S., (2011). Handbook of product graphs. CRC press.

Porter, M.E. and Heppelmann, J.E., (2014). How smart, connected products are transforming competition. Harvard Business Review, 92(11), pp.64-88.

Jayal, A.D., Badurdeen, F., Dillon, O.W. and Jawahir, I.S., (2010). Sustainable manufacturing: Modeling and optimization challenges at the product, process and system levels. CIRP Journal of Manufacturing Science and Technology,2(3), pp.144-152.

Brennan, L. and Owende, P., (2010). Biofuels from microalgae—a review of technologies for production, processing, and extractions of biofuels and co-products. Renewable and sustainable energy reviews, 14(2), pp.557-577.

Bosch, J. and Bosch-Sijtsema, P., (2010). From integration to composition: On the impact of software product lines, global development and ecosystems. Journal of Systems and Software, 83(1), pp.67-76.

Varadarajan, R., (2010). Strategic marketing and marketing strategy: domain, definition, fundamental issues and foundational premises. Journal of the Academy of Marketing Science, 38(2), pp.119-140.

Kuhfeld, W.F. and Tobias, R.D., (2012). Large factorial designs for product engineering and marketing research applications. Technometrics.

Papadopoulos, N. and Heslop, L.A., (2014). Product-country images: Impact and role in international marketing. Routledge.

Lähteenmäki, L., Lampila, P., Grunert, K., Boztug, Y., Ueland, Ø., Åström, A. and Martinsdóttir, E., (2010). Impact of health-related claims on the perception of other product attributes. Food Policy, 35(3), pp.230-239.

Krebs, F.C., Fyenbo, J. and Jørgensen, M., (2010). Product integration of compact roll-to-roll processed polymer solar cell modules: methods and manufacture using flexographic printing, slot-die coating and rotary screen printing. Journal of Materials Chemistry, 20(41), pp.8994-9001.

Kotler, P. and Armstrong, G., (2010). Principles of marketing. pearson education.

Hoyer, W.D., Chandy, R., Dorotic, M., Krafft, M. and Singh, S.S., (2010). Consumer cocreation in new product development. Journal of Service Research, 13(3), pp.283-296.

Kotler, P., (2012). Kotler on marketing. Simon and Schuster.

Hultén, B., (2011). Sensory marketing: the multi-sensory brand-experience concept. European Business Review, 23(3), pp.256-273.

Storbacka, K., (2011). A solution business model: Capabilities and management practices for integrated solutions. Industrial Marketing Management, 40(5), pp.699-711.

Gummesson, E., (2011). Total relationship marketing. Routledge.

Chen, Y., Fay, S. and Wang, Q., (2011). The role of marketing in social media: How online consumer reviews evolve. Journal of Interactive Marketing, 25(2), pp.85-94.

Hugstad, P.S. and Durr, M., (2015). A study of country of manufacturer impact on consumer perceptions. In Proceedings of the 1986 Academy of Marketing Science (AMS) Annual Conference (pp. 115-119). Springer International Publishing.

Burroughs, J.E., Dahl, D.W., Moreau, C.P., Chattopadhyay, A. and Gorn, G.J., (2011). Facilitating and rewarding creativity during new product development. Journal of Marketing, 75(4), pp.53-67.

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