The Difference in a Product & a Product Concept
Despite being close semantically, product and product concept are quite distinct terms. A product is a hard good, a tangible item of value sold to a business, consumer or trade channel buyer. The product concept relates to the benefits of the product that distinguish it from competitors.
Products are sold within the trade channel, typically by manufacturers to wholesalers, wholesalers to retailers and then retailers to consumers. Additionally, some resellers sell products to business buyers who use products to operate their businesses. Products have tangible value based on the features they consist of and the related benefits those features provide to customers. For instance, a car has value because of its usefulness in transportation as well as its emotional value in helping people feel a sense of status.
Product concept is an extension of a product's value. It refers to the most critical benefits offered by a hard good as determined by marketers. Companies conduct market research to find out what customers are most interested in with regard to a particular product and consider that in marketing. The product concept serves as the core theme in promotional strategies. Marketers develop advertising and public relations strategies to project the most impactful product benefits to target customers.
The marketing mix is a key strategic tool used in developing a marketing strategy. It includes four elements: product, distribution, price and promotion. The product analysis describes the nature of the products the company develops and offers to the marketplace. The product concept essentially binds the product element to promotions. The promotion component outlines promotional goals, strategies and tactics, including paid advertising techniques.
The value proposition is the mixture of benefits offered by a given product. In essence, it is the relative weight of a product's benefits in the minds of customers compared to its price. Understanding of the product concept and formulation of marketing strategies is key in building a strong value proposition for a given product. Another perspective is that the product has certain capabilities, and the product concept is the package of those capabilities delivered in promotion to customers.