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Looking to the customer for guidance is particularly important when deciding upon the specific product/service to be provided. The product or service offered by the company must be one that meets the needs of the customers, not one that satisfies only the producer. For instance, you may be a lover of blueberry-flavoured milk, but that does not necessarily mean that you should sell it in your store. There may not be a demand for such a product.

Be aware of the “total product concept” or the idea that you are selling more than just a physical product or service. Successful firms sell bundles of benefits, not just products or services. For example, a car dealer does not sell automobiles; the company sells reliable, individual transportation. Anti-lock brakes are a feature of an automobile; but the benefit, the reason that motivates people to buy anti-lock brakes, is safety. Similarly, toothpaste that removes stains (a feature) offers the benefit of white teeth.

The product or service includes offering a wide array of options to meet varying tastes, and often includes after-sales service. An entrepreneur’s approach to offering a “total” product to his/her customers should provide and advantage over the competitors.

The total product concept may be described as follows:

1. Core product
This is the benefit provided.

2. Actual products
This includes the tangible features of the product such as quality, styling, brand name, packaging, optional features.

3. Augmented product
This includes additional services and benefits beyond the physical (such as delivery and credit, installation, after sale service, warranty).

For example, consider the core product for a restaurant that prepares markets and delivers home-cooked meals. The core products (benefits) are taste and convenience. The actual products (tangible features) are home cooked, prepared meals with wholesome ingredients, packaged in a re-usable, microwave able casserole dish. The augmented products (additional services) are speedy delivery, acceptance of major credit cards upon delivery, and a guarantee the food will satisfy the customer or their money is refunded.

Different aspects of the “total product concept” can be emphasized to differentiate an entrepreneur’s product or service from the competition. Products can be differentiated from competitors by quality and durability, colour, odour/flavour, and by the level and type of service. For example, the five basic selling propositions for toothpaste are: taste, whitener, breath freshener, fluoride and price. All competitors advertise at least one of these features, sometimes more than one, to differentiate their product or service from others.

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