Products, Services, and Experiences
Product is a key element in the overall market offering. Marketing-mix planning begins with formulating an offering that brings value to target customers. This offering becomes the basis upon which the company builds profitable relationships with customers.
A company’s market offering often includes both tangible goods and services. Each component can be a minor or a major part of the total offer. At one extreme, the offer may consist of a pure tangible good, such as soap. Toothpaste, or salt—no services accompany the product. At the other extreme are pure services, for which the offer consists primarily of a service. Examples include a doctor’s exam or financial services. Between these two extremes, how ever, many goods-and-services combinations are possible.
Today, as products and services become more commoditized, many companies are moving to a new level in creating value for their customers. To differentiate their offers, beyond simply making products and delivering services, they are creating and managing customer experiences with their products or company.
Experiences have always been important in the entertainment industry—Disney has long manufactured memories through its movies and theme parks. Today, however, all kinds of firms are recasting their traditional goods and services to create experiences. For example, American girl Inc does more that just make and sell high-end dolls. It takes additional steps to create special experiences between the dolls and the girls who adore them.
To extend its reach and to put more smiles on the faces of the girls who adore their American Girl dolls, the company has opened American Girl Places in Chicago. New York, Los Angele's. Inside a Place—which has become as much of a destination spot as it is a store—are a series of wonderfully engaging experiences for girls, mothers, and grandmothers (not to mention the occasional male who’s either dragged into the Place or who lovers his daughter very much). There’s a theater with a live play centered on the doll collection: there’s a cafe for a grown-up dining experience: there’s a salon to style a doll’s hair; and a doll hospital to fix one up as good as new. Before, during, and after all these experiences, shopping does go on—and the purchases become memorabilia for the experiences visitors have. Moreover, these same visitors buy more from the catalog, frequent the Web site to purchase items more often, and tell their friends about their American Girl Place experience. Much more than a store that sells dolls, says the company, “it’s the place where imaginations soar—from boutiques to special events, from the cafe to the theater and beyond.”
Companies that market experiences realize that customers are really buying much more than just products and services. They are buying what those offers will do for them.