Products, services and product mix decisions

What are products and services? What are the product mix decisions?

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First and foremost, I had to give you the definition of those three terms. Let’s start with the first two: product and service. Basically a product is anything that can be bought on the market by customers. And the goal is to satisfy customer’s need and/or want. Whereas a product is tangible, a service is mort of the time intangible. A service is a form of service including activities, benefits, or satisfaction offered for sale. The main difference between a product and a service is the ownership. Indeed, a product results in an ownership whereas a service doesn’t result in ownership.

Services have four features: they are intangible, perishable, variable (in terms of quality), and inseparable from their providers.

For example, when you go to a restaurant, the food is a product but what the waiter does is a service.

Now that you have a clear idea of what is are a product and a service then we can go on to the product mix decision. The product mix is a concept with four different dimensions: width, length, depth, and consistency.

–          The width is the number of different product lines that a company carries.

–          The length is the total number of goods a company carries within its production lines.

–          The depth is the number of versions offered for each product in the line.

–          The consistency refers to how closely related product lines are to one another–in terms of use, production and distribution.

The definitions may seem hard to understand but this graph should be useful:

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http://www.learnmarketing.net/productobjectives.htm

To illustrate those definitions, let’s take an example.

Let’s take Samsung as the referent company.

Samsung has several products on the market, each constitutes a product line, for example all Samsung televisions are a product line, as well as cellphones, computers, cameras. More product lines are available on the market but four is enough for the understanding. So the product mix width would be four in my example. Then Samsung offers different types of televisions for example, the LCD TV’s, LED TV’s, and Plasma Tv’s. So the product line length is three. And then, different models of the LCD TV’s are offered by Samsung on the market. As you can see on the graph, the product line depth is two.

Image’s reference: http://nextdayturf.co.uk/calculate-area-soil.asp

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