Products are physical items that companies make or assemble to sell it to people. These items can range from small, everyday things like chocolates to more complex items like cars or industrial machines. Understanding the different types of products can give you a better idea of the variety of goods that companies create and offer. In this article, we will talk about the types of products by giving examples of each, and explaining how they are related to services.
Types Of Products – Key Takeaways
- Businesses create many types of products, from small everyday items to large, complex machines. Each product is made for a specific purpose and has its own target market and features.
- Knowing about the different types of products, like consumer goods and industrial goods, helps businesses in creating better strategies and marketing plans for each product.
- Products and services are both offered to consumers and other businesses in exchange for money. However, products are physical items, while services are actions or tasks that don’t involve physical objects.
What Are Types Of Products?
Types of products generally refer to the different kinds of items that companies create to sell it to customers and other companies. These products are mainly classified into two types-Â
- Consumer Goods
- Industrial Goods
Let us understand both of these types of products with examples. So, businesses basically make consumer goods for individual needs and industrial products for other companies, which are moreover to help them in their manufacturing. Each product type has its unique purpose, customers, and has distinct features.Â
Businesses usually conduct thorough market research and study existing products when planning to create new ones. In logistics, workers use their knowledge to manage supply chains, plan distribution, and ensure goods are shipped efficiently. Sales teams use product knowledge to design advertising campaigns and inform customers about products.
Companies mainly buy raw materials and machinery from other businesses to produce products for consumers. These consumers then use the products to meet their basic needs or to achieve their goals like satisfaction or status. Products are essential to the economy as it helps in driving business activity and influencing consumer behavior.
Consumer Products
People usually buy consumer products for their personal use. These products can be basic items like food and drinks or special items that show status or have a unique purpose. Marketers often group consumer goods into different categories based on their usage. Understanding the category of a product helps in creating better marketing strategies to share information with the right audience. Here are some types of consumer products that you should know as a product manager.
Convenience Products Â
Convenience products are everyday items that people buy without much thought. These are low-cost, mass-produced items that people regularly purchase to meet basic needs like hunger or thirst. You can find these products in many places. Examples of these products include milk, candy bars, magazines, and laundry detergents. In this case, people are not usually loyal to a specific brand for some of these items and may buy whatever is easily available and cheap.Â
Convenience products can be divided further into a few types, which include:
- Staple Goods: These are items that people buy regularly, like a favorite drink or snack. Here sometimes, people stick to a brand they like because it consistently meets their expectations.
- Impulse Goods: These are items people buy on the spur of the moment, like candy or magazines at the checkout.
- Emergency Goods: These are items people only buy when they need them urgently, like matches, umbrellas, or bandages. They help in solving immediate problems.
Specialty Products Â
Specialty products are unique items that have a strong connection with specific brands. People actively seek these products and are even willing to pay more for them. They rarely compare them with other brands and buy products considering the brand value.
Examples of these types of products include- high-quality foods, luxury watches, and designer-branded clothes. Unlike convenience products, these items are not as easily available on every shop. Product managers of specialty products usually focus their marketing for building a strong brand image and highlighting the product’s exclusivity and superior quality.
Shopping ProductsÂ
Shopping products are items that people carefully consider and compare before buying. These products usually have a higher price and are not purchased on a regular basis.
Examples of these products include cars, home appliances, furniture, and more. When buying these items, people pay attention to quality and value for money. They research, test, and compare different options to find the best one in their budget range. Businesses selling shopping products use various online marketing strategies to stand out from competitors.
There are two types of shopping products: homogeneous and heterogeneous. Homogeneous products are similar across brands, so consumers mainly focus on price when choosing. Appliances are a good example of this type. On the other hand, heterogeneous products differ greatly in style and brand. Consumers evaluate these products based on their unique features. Cars and clothing fall into this category.
Unsought Products Â
Unsought products are items that people rarely think about or seek out. These products are often unfamiliar or not immediately needed until a specific situation arises. Examples include insurance, funeral services, and charitable donations. Businesses selling these products need to reach out to potential customers directly by using methods like door-to-door sales or telemarketing, to explain their benefits and why they are important.
Industrial Products
Industrial products are items that businesses buy for their own operations and not for consumers. These products are used in the manufacturing process or to make other finalized goods. Here are some of the main types of industrial products that are used by the businesses:
Capital goods Â
Capital goods are large items that businesses use to make other products or provide services. These can include big machines, factory buildings, or tools like those used by musicians or hairdressers. Capital goods are often expensive and can be a major cost for businesses.
Raw materials
Raw materials are the basic resources that companies use to create finalized products. These can be natural items like wood, wheat, or water. Businesses often process and combine multiple raw materials to make new products or components.
Component parts Â
Component parts are pieces that are made separately and then put together to create a larger product. For example, computer hard drives, metal parts, and tires are component parts. Businesses usually buy these parts to include them in the final products they sell to consumers.
Major equipment Â
Major equipment includes large, costly machines that companies use in production. This equipment is crucial for making products and often requires careful management due to its high cost. Sometimes, businesses invest in research to improve their major equipment for better efficiency.
Accessory equipmentÂ
Accessory equipment includes smaller tools and items that help in providing support to business operations. This can be anything from office computers to shelves in a warehouse. Companies often try to save money by buying these items in bulk or choosing lower-cost options.
Operating SuppliesÂ
Operating supplies are items that businesses generally use during their daily work. Common examples of this include- paper, pens, and cleaning products. Companies usually buy these items in large quantities from specific suppliers to ensure they always buy cost-effective products and have enough on hand.
Products vs. ServicesÂ
Products and services are both things that businesses offer to customers in exchange for money. However, products are physical items you can touch and use in your daily life, while services are actions or experiences. Let us understand this better with the help of an example- educational courses you take up on the internet, subscription to the Netflix streaming platform, and recreational activities are types of services.Â
Some services, like car washes, are for the convenience of users. While others, like massages or custom lessons, are more specialized and attract people looking for something specific. There are also several services like towing or waste management, which people only need in certain situations.
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Types Of Product FAQs
What are the main types of products?
The main types of products are consumer products, industrial products, and services. Consumer products are for personal use, industrial products are used in production, and services are intangible offerings.
What are consumer products?
Consumer products are items bought by individuals for personal use, such as food, clothing, and electronics. These are further divided into convenience, shopping, specialty, and unsought products.
What are industrial products?
Industrial products are goods used by businesses to produce other products or provide services. Examples include machinery, raw materials, and supplies used in manufacturing.
What are the different types of consumer products?
Consumer products are mainly categorized into convenience products, shopping products, specialty products, and unsought products, based on how consumers buy them.
