session (2)

• Classification of goods and services

  • Consumer goods
  • Industrial goods
  • Services
• Classification of consumer goods based on Durability

  • Durable goods
  • Non-durable goods
• Durable goods

  Tangible goods that can normally be used for many years
• Durable goods

  • Have a long life-span
  • Are meant for repeated use
  • Are of a high price and hence belong to the middle-income group upwards
• Non-durable goods

  Tangible goods normally consumed in either one or a couple of uses, purchased regularly and consumed frequently
• Non-durable goods


  • Have a very short life as they are perishable
  • Get consumed away and are meant to be replenished, or lose their usable nature
  • Are of a far lower price and are also necessities and are bought by all
  • Are a usual and automatic and routine purchase
  • Are bought usually with routine 'replenish the stock' regularity
  • Consumers purchase branded, unbranded as they usually can perceive the quality themselves
• Classification of consumer goods based on Shopping Effort

  • Convenience products
  • Shopping products
  • Specialty products
  • Unsought products
• Convenience products


  Goods that a customer purchases frequently, with minimum effort and time to make a buying decision
• Types of convenience products

  • Staple goods
  • Impulse goods
  • Emergency goods
• Convenience products


  • Are easily available and require minimum time and effort
  • Are obtainable at low prices
  • Have a continuous and regular demand
  • Have high demand and competition
  • Are easily substitutable
  • Have heavy advertising and sales promotion schemes
• Shopping products

  Goods where the customer makes comparisons on the bases of quality, price, style and suitability
• Types of shopping products

  • Homogeneous products
  • Heterogeneous products
• Shopping products

  • Are durable in nature
  • Have high unit price and profit margin
  • The customer spends adequate time and compares products before making the final purchase
  • Purchase of such products is planned prior
  • Important role played by the retailer in the sale
• Specialty products

  Goods with a unique characteristic or brand identification for which a sufficient number of buyers are willing to make a special purchasing effort
• Specialty products

  • The demand for such products is relatively infrequent
  • Products are high priced
  • Sale of such products is limited to a few places
  • Aggressive promotion is required
  • After-sales service is required
• Unsought products

  Products that are available in the market but the potential buyers do not know about their existence, do not want to purchase them, or did not know they needed them
• Types of unsought products

  • Regularly unsought products
  • Newly introduced unsought products
• Specialty goods

  • Limited to a few places
  • Aggressive promotion is required
  • After-sales service is required
• Marketing strategy of specialty goods

  1. Price: High prices, low demand and supply

  2. Promotion: Targeted promotion, high advertising

  3. Place: Exclusive selling in only one or few selected outlets, consistency of image between product and store

  4. Product: Jewellery, Rolex watches, Swarovski crystals
• Unsought products

  Products that are available in the market but the potential buyers 1) do not know about their existence or 2) they do not want to purchase them, or 3) they did not know they needed them
• Types of unsought products

  • Regularly unsought products: Products which exist but consumers do not want to purchase them as of now but might eventually purchase them
  • New unsought products: Products that the marketer has to inform target consumers of their existence, stimulate demand and persuade them to buy
• Marketing strategy of unsought goods

  1. Price: Varies

  2. Promotion: Personal selling and aggressive advertising

  3. Place: Depends on the product

  4. Product: Life insurance, Red Cross blood donations
• Convenience goods need speedy distribution and intensive distribution to fight competition
• Shopping goods require personal selling as they are not a habit of purchase and are high-tech, requiring persuasion
• Specialty goods are luxury goods, priced highly, and generally have to be of exceptional quality
• Unsought goods are innovative new products, requiring personal selling and wide advertisement to explain, demonstrate and persuade the consumer
• A convenience product for one consumer may be a shopping product for another, depending on income level
• Types of consumer products based on purchase behaviour

  • Convenience
  • Shopping
  • Specialty
  • Unsought
• Basis of comparison for types of consumer products

  • Product
  • Price
  • Place (distribution)
  • Promotion
  • Brand loyalty of consumers
  • Purchase behavior of consumers
• Industrial products

  • Limited number of buyers
  • Short distribution channel
  • Demand concentrated in certain geographical locations and derived from consumer goods demand
  • Purchase based on fulfillment of technical considerations
  • Reciprocal buying involved
  • May be leased rather than purchased due to high costs
• Types of industrial products

  • Entering goods: Raw materials, fabricating materials
  • Capital items: Installations, equipment, tools/accessory equipment
  • Supplies and business services: Maintenance and repair items, operating supplies, maintenance services, business advisory services
• Raw materials

  Agricultural-based products or natural products
• Manufactured materials and parts

  Component materials like glass, iron, plastic or components like battery, bulbs or steering
• Capital items


  Goods used in producing the finished goods, including installations, equipment, and tools/accessory equipment
• Supplies and business services

  Goods required for developing or managing the finished products, including maintenance and repair items, operating supplies, maintenance services, and business advisory services
• Differences between industrial goods and consumer goods

  • Meaning
  • Demand
  • Market size
  • Elasticity of demand
  • Type of buyers
  • Distributional channel
  • Transactional value and quantity
  • Reason of purchase
  • Purpose
  • Demand initiated by
• Consumer goods

  Meant for final consumption by final consumer
• Industrial goods

  Bought by the consumer to be used in production of goods and services
• Demand for industrial goods

  Varies in direct proportion to the demand for consumer goods
• Consumer goods market

  • Market size is large