What is anything offered to a market by the business to satisfy needs could include physical products or intangible services?
What Is an Augmented Product?An augmented product has been enhanced by its seller with added features or services to distinguish it from the same product offered by its competitors. Augmenting a product involves including intangible benefits or add-ons that go beyond the product itself. Show
Examples of the features used to create augmented products might include free delivery or in-home installation of a service. Cosmetics companies tend to offer free makeovers and travel-size samples to augment their products. Key Takeaways
How an Augmented Product WorksTo marketing professionals, every product comes in at least three versions: The core, the actual, and the augmented. Core ProductThe core product is not a physical object. It is the product's benefit to the consumer. For example, a lipstick will make its buyer attractive; a pair of sneakers will make her healthier; a new phone will help you communicate more efficiently. Actual ProductThe actual product is the item for sale, including the unique branding, design, and packaging that is attached to it. The actual product and its features must deliver on the core-product expectations that consumers want from the product. A car, for example, should function seamlessly with all of its features to deliver the core product and create customer value. Augmented ProductThe augmented product adds on features and services that distinguish it from similar products offered by the competition. The add ons don't change the actual product and may have a minimal impact on the cost of producing the product. However, an augmented product may have a perceived value that gives the consumer a reason to buy it. The added value may also allow the seller to command a premium price. Augmentation doesn't change the product being sold. However, augmentation adds value to the experience for the consumer and can lead to brand loyalty. Examples of Augmented ProductsIt's no secret that companies that can effectively create augmented products create a positive buying experience and have the best chance of developing a loyal base of repeat customers. Apple TVApple Inc. (AAPL) launched its video and TV streaming service in 2019. To boost awareness of the new product and increase sagging iPhone sales, the company created an add-on or augmentation for anyone purchasing a device as stated below from the company's website. "Starting today, customers who purchase any iPhone, iPad, Apple TV, iPod touch or Mac can enjoy one year of Apple TV+ for free." Discounts and FreebiesA discount coupon for a future purchase is a product augmentation, as is an offer of a refund if the customer is dissatisfied. A free recipe book offered with the purchase of a kitchen appliance such as a crockpot creates an augmented product. More expensive purchases often come with enhanced augmentation. In-store financing for furniture purchases, a free trial, or free delivery all augment the product being offered. A cable company competing for new business might offer a more convenient home installation schedule to attract customers. Service SellsGood customer service and store ambiance are augmentations that brick-and-mortar retailers add to their entire range of products. A generous return policy and in-store demonstrations are others. A retail store that sells cooking supplies might offer free cooking classes with each purchase. Apple, for example, offers teaching and guidance for how to use their products through their retail locations. An engaging website to help customers learn about a product or service, as well as an online support team, are product augmentations. In considering almost any purchase, consumers have a wealth of options. An augmented product has been made to stand out from other products, or the same product offered by other sellers. Product, Price, Promotion, Place What are the 4 P’s of Marketing?The “4 P’s of Marketing” refer to the four key elements comprising the process of marketing a product or service. They involve the marketing mix, which is a set of tools that a company uses to influence consumers into buying its product. The marketing mix addresses factors such as:
History of the 4 P’s of MarketingThe individual who conceptualized the 4 P’s of Marketing was a Harvard University professor named Neil Borden. In 1964, Borden introduced the idea in one of his published articles called “The Concept of the Marketing Mix.” he mentioned that many companies could use the framework to increase the likelihood of their success when advertising their products. Marketing Mix1. ProductA product is any good or service that fulfills consumer needs or desires. It can also be defined as a bundle of utilities that comes with physical aspects such as design, volume, brand name, etc. The type of product impacts its perceived value, which allows companies to price it profitably. It also affects other aspects such as product placement and advertisements. Companies can change the packaging, after-sales service, warranties, and price range, or expand to new markets to meet their objectives. Marketers must understand the product life cycle and come up with strategies for every stage in the life cycle, i.e., introduction, growth, maturity, and decline. 2. PriceThe price of a product directly influences sales volume and, consequently, business profits. Demand, cost, pricing trends among competitors, and government regulations are crucial factors that determine pricing. Price usually reflects the product’s perceived value rather than its real value. This means that pricing can be increased to promote exclusivity or reduced to create access. Thus, pricing involves making decisions in terms of the basic price, discounts, price alteration, credit terms, freight payments, etc. It is also important to analyze when and if techniques like discounting are required or appropriate. 3. PromotionPromotion involves decisions related to advertising, salesforce, direct marketing, public relations, advertising budgets, etc. The primary aim of promotion is to spread awareness about the product and services offered by a company. It helps in persuading consumers to choose a particular product over others in the market. Promotional efforts include the following:
4. Place (or Distribution)Place involves choosing the place where products are to be made available for sale. The primary motive of managing trade channels is to ensure that the product is readily available to the customer at the right time and place. It also involves decisions regarding the placing and pricing of wholesale and retail outlets. Distribution channels such as outsourcing or company transport fleets are decided upon after cost-benefit analysis. Small details such as shelf space committed to the product by department stores are also included. Extensions to the 4 P’s of MarketingNew marketers recommend expanding the 4 P’s of Marketing to include services as well. They include:
More ResourcesThank you for reading CFI’S guide to the 4 P’s of Marketing. To keep learning and advancing your career, the following CFI resources will be helpful:
Which of the following refers to anything offered to a market by the business to satisfy needs and could include physical products or intangible services?In essence, the term “product” refers to anything offered by a firm to provide customer satisfaction, tangible or intangible.
What are the 4 types of marketing?What are the 4Ps of marketing? (Marketing mix explained) The four Ps are product, price, place, and promotion. They are an example of a “marketing mix,” or the combined tools and methodologies used by marketers to achieve their marketing objectives. The 4 Ps were first formally conceptualized in 1960 by E.
What is a product offering in marketing?A marketing offering is a product or service that a company provides to customers to meet their needs. An offering encompasses more than the single product or service. It includes the extra value that a business adds to their products, such as convenience, quality and support.
What element of marketing mix refers to the good or service that the enterprise offers to its customers?The four Ps of marketing: product, price, place and promotion. The marketing mix can be divided into four groups of variables commonly known as the four Ps: Product: The goods and/or services offered by a company to its customers.
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