A particular product has 5 levels (core benefit, generic product, expected level, augmented product, potential product). When a buyer buys a product, he buys a package, not only the tangible product. With a soap, you purchase, for example, the soap itself, an image, and a number of interrelated satisfactions. Marketers should, therefore, need to think about different levels of a product in planning their marketing programs. Different levels add different value to the customers.
Why is Understanding Product Levels Important? – Product is the Most important P in the Marketing Mix
Marketers need to understand that the concept of “product” is not simple. Product is the central component of the marketing mix because other Ps in the marketing mix is just there to sell the product.
Price reflects the initial cost to customers of obtaining the product; physical distribution makes sure the product is available; promotion is just making sure the target customers learn and develop a need about the product.
So when a customer is satisfied with the product. That means the marketing mix has worked.
Product is the heart of the marketing mix; it is what finally makes or breaks a marketing campaign. Understanding the levels of products helps to design the actual product and helps to develop the marketing mix.
What are the 5 Product Levels?
The five product levels are;
- Core Benefit.
- Generic Product or Basic Product.
- Expected Level.
- Augmented Product.
- Potential Product.
Let’s example each level of a product;
1. Core Benefit
The first and the basic level is the core product/benefit the customers look at. It is the basic good or service purchased, aside from its packaging or accompanying services. We buy a product first because of its core or fundamental benefit – the problem it solves or the need it satisfies.
From a bar soap, for example, the core benefit we look at is: it cleans our skin. While the purchaser of a cosmetic item buys beauty, the purchaser of a lottery ticket buys hope, and so on. A core product’s benefits range from tangible to intangible.
2. Generic Product or Basic Product
The benefits that customers look at must be turned into a basic product by the marketer. A calculator, for example, includes plastic, metal, electronic circuits, and a liquid display crystal.
The most fundamental level is the basic product, which seeks an answer to the question: What is the buyer really buying? The basic product forms the nucleus of the total product. It constitutes the problem-solving features or basic benefits that consumers seek when they acquire a product.
A person buying a car acquires mobility, which enables him to move from one place to another. Theodore Levitt has pointed out that buyers “do not buy quarter-inch drills; they buy quarter-inch holes.”
3. Expected Product
The next level is the expected level. It includes a set of attributes and conditions that the buyer expects which marketer should provide for purchase to take place. In the case of a calculator, the buyers expect it to be handy, easy to operate, and so on.
4. Augmented Product
The Fourth Level of a Product is the Augmented Level or the augmented product. The augmented product is what the customer is really buying. It is a good, service, or an idea enhanced by its accompanying benefits.
It is a combination of what the seller intends, and the buyer perceives. An augmented product gives customers more than they expect. People do not buy products; they buy the expectations of benefits. The marketing view demands the active recognition of this and acts accordingly.
Modern-day marketers compete with each other through the augmented product. A marketer deciding to augment his product should be well aware of the total consumption system of buyers.
Understanding the total consumption system means identifying the tasks customers perform through the use of the product. Identifying this will give him leads on which he can augment his product.
In formulating the product augmentation policy, the marketer should take note of a number of things. Since augmentation requires the company substantial costs, it should know whether customers will be willing to take this load.
After getting the augmented benefits for sometimes, customers start thinking those as rights, i.e., they consider those benefits as expected, not augmented. The company should, therefore, look for additional benefits to offer.
The company should also note that soon after it offers augmented products at a premium price, some competitors may start offering the basic or expected product at a much lower price.
This will obviously pull a significant number of customers, thus causing the firm a fall in sales. The company should therefore remain ever alert so that augmentation yields the desired result.
5. Potential Product
The last level of a product is the potential product. It encompasses all the augmentations and transformations that the product might ultimately undergo in the future’.
Augmentation, you know, is concerned with what the product includes in the present term, where the potential product is concerned with what may be added to the product in the future to make it more desirable. The potential product is aimed at not only satisfying the customers but present the product that delights and surprises the customers.
What are the 3 Levels of Products!?
We just looked at the 5 levels of products, which is updated from the 3 levels of products. Still understanding them is important as it shows how the product’s definition has changed in modern times.
In designing a product, marketers need to consider a product on three levels.
First task; the most fundamental level is the core product, which seeks the answer to the question: What is the buyer really buying?
The core product forms the nucleus of the total product, indicates the problem-solving features or core benefits that consumers look for on the product.
A toaster needs to toast, micro-oven needs to cook the food – no matter how many smart features a company gives with them. A smart toaster or micro-oven will fail in the market if it is not adequate to cook meals.
So, in designing a product, marketers must start with defining the core of benefits, that is, the functional features the product will possess
The 2nd task of a marketer is to build an actual product surrounding the core product.
Actual products usually have as many as five characteristics; a quality level, features, design, a brand name, and packaging. For instance, Sony’s – Eye Master Television set is an actual product. Its name, parts, styling, features, packaging, and other attributes have all been combined carefully to deliver the core benefit -entertainment through watching TV programs.
Finally, third task; the marketer must build an augmented product around the core and actual products by adding extra consumer services and benefits. Sony must offer more than just a television set.
It must provide consumers with a complete solution to their operating problems. Sony and its dealers also might give buyers a warranty on spare parts and better quality, free lessons on use methods, quick repair services when needed, and a telephone number to call if they have any query.
Consumers consider all of these augmentations as an important component of the total product.
Therefore, a product is something more than a combination of tangible features. To the consumers, products are complex bundles of benefits that satisfy their needs.
In developing products, marketers first must carefully identify the core consumer needs the product will satisfy. Then the actual product should be designed along with appropriate ways to augment it for creating the bundle of benefits for the purpose of ensuring maximum satisfaction to the consumers.