Product Components

We know that consumers purchase products to satisfy needs. Another way to say this is that people really want a “bundle” of benefits when they purchase a product, and different consumers are likely to want different benefits from the same type of a product. For example, some consumers buy Rollerblade skates for fun, others as a way to increase health and fitness, and others because of the excitement involved with in-line roller skating.

To provide the benefits consumers want, marketers need to integrate the components that make up a product effectively. These consist of the product and customer service features. Product features include quality, design, branding, and packaging. Customer service encompasses various purchase and usage services. Different blends of product features and customer service provide different benefit bundles.

Credit cards offer a good example. Although all credit cards provide a basic benefit (credit), they offer different mixes of benefits to appeal to specific consumers. Credit cards differ in annual fees, rewards for use of the card, payment terms, design of the card, brand name, and services provided. All these components interact to produce the product, or the benefits, consumers’ purchase. For example, American Express recently launched a new credit card, the Blue card. In addition to offering typical credit card features and benefits, the Blue card offers user’s access to the American Express Online Wallet. This new feature provides customers with the benefit of faster and more-secure on-line purchase. Consumers concerned about Internet security are likely to value the benefit bundle offered by the Blue card.

Some firms are practicing mass customization by offering each customer a customized bundle of benefits. New information and communications technologies are making this possible. For example, many Internet sites allow each individual user to select specific types of information to be continuously downloaded and displayedon the user’s screen. Each customer can select the stock prices to be reported, the cities for weather forecasts, the types of sports information desired, and other specific types of information to be communicated. Another example is the marketing by Levi’s of custom-fitted jeans to women. As technology develops, more opportunities to increase customer value through mass customization will become available.

Comprehension questions:

1. Why do people buy products?

2. What is a “bundle” of benefits?

3. What does product features include?

4. How do credit cards differ?

5. What is mass customization?