What Are the Three Levels at Which a Product Can Be Seen? in Response, Use a Concrete Example of Product.
Assignment No.9
Rome Business School
Q1 What are the three levels at which a product can be seen? In response, use a concrete example of product.
The product is defined as a "thing produced by labor or effort or the "result of an act or a process"and stems from the verb produce from the Latin 'produce ' which means to lead or bring forth '. The first economic use of the word was by Adam Smith, known as the father of modern economics.
-Kotler et al (1989)
For marketers, it is useful to divide the product into three main categories, being the Core Product ( Also known as Core Benefit), the Actual product and the Augmented Product. You can see them in the diagram below with some examples of what they encompass.
-Kotler et al(2006)
I shall use the example of the Adidas Sports apparel, a product line which they have used heavy societal marketing to promote. Adidas is the largest sportswear manufacturer in Europe, and the second largest in the world. The 11% increase in sales in 2011 thanks to their new marketing efforts has meant an income of around 634 million euros. Out of this, they invested about 136 million euros in Marketing. About 1/6th of their income.
-Adidas annual report (2011)
The strategy behind selling their sports apparel, has been to differentiate the offering from their competitors like Nike by providing more customization for the customers. They say their key strategic pillars are:
Gaining sales and market share with key growth categories such as running and basketball within Adidas Sport Performance
Leading the industry in the fields of customization and interactivity across categories
Expanding Adidas Sport Style in the fast-fashion business with the Adidas NEO label
It is obvious here, that Adidas has invested heavily in developing all three layers of their product.
The Core Product: this is the part of the product which satisfies the basic need of a consumer
Rome Business School
Q1 What are the three levels at which a product can be seen? In response, use a concrete example of product.
The product is defined as a "thing produced by labor or effort or the "result of an act or a process"and stems from the verb produce from the Latin 'produce ' which means to lead or bring forth '. The first economic use of the word was by Adam Smith, known as the father of modern economics.
-Kotler et al (1989)
For marketers, it is useful to divide the product into three main categories, being the Core Product ( Also known as Core Benefit), the Actual product and the Augmented Product. You can see them in the diagram below with some examples of what they encompass.
-Kotler et al(2006)
I shall use the example of the Adidas Sports apparel, a product line which they have used heavy societal marketing to promote. Adidas is the largest sportswear manufacturer in Europe, and the second largest in the world. The 11% increase in sales in 2011 thanks to their new marketing efforts has meant an income of around 634 million euros. Out of this, they invested about 136 million euros in Marketing. About 1/6th of their income.
-Adidas annual report (2011)
The strategy behind selling their sports apparel, has been to differentiate the offering from their competitors like Nike by providing more customization for the customers. They say their key strategic pillars are:
Gaining sales and market share with key growth categories such as running and basketball within Adidas Sport Performance
Leading the industry in the fields of customization and interactivity across categories
Expanding Adidas Sport Style in the fast-fashion business with the Adidas NEO label
It is obvious here, that Adidas has invested heavily in developing all three layers of their product.
The Core Product: this is the part of the product which satisfies the basic need of a consumer
References: Kotler, Philip; Gary Armstrong (1989). Principles of Marketing, fourth edition (Annotated Instructor 's Edition). Prentice-Hall, Inc.. pp. 639 Kotler, Philip., Armstrong, G., Brown, L., and Adam, S Kotler,Philip.,Armstrong,G. (2010) Principles of Marketing 13th Ed. Pearson education. Australia/Prentice hall. History of Zara. (2008). Retrieved November 3, 2009, from Zara-Clothing: http://www.zaraclothing.net/history-of-zara/ MarketLine Holt, DB (2004). "How Brands Become Icons: The Principles of Cultural Branding" Harvard University press “Harvard MA Websites: