All products can be broadly classified into 3 main categories. These are:
Tangible products: These are items with an actual physical presence such as a car, an electronic device, and an item of clothing or a consumer good.
Intangible products: These are items that has no physical presence but can be felt indirectly. An insurance policy is an example of this. Online items such as software, applications or even music and video files are also intangible products.
Services: Services are also intangible products but they are the result of an economic activity that does not result in ownership. It is a process that creates benefits for customers. Services depend highly on who is performing them and remain difficult to reproduce exactly.
Both tangible and intangible goods and services can be further defined and divided into the following groups:
- Consumer Goods – Items that are used directly by the end user such as food, clothing, cars, etc,
- Consumer Services – Services that are for the benefit of end users directly such as education, courier services, grooming services, etc.
- Producer Goods – Items that act as part of another company’s operations such as machinery or parts.
- Producer Services – Services that support another company’s operations such as accounting, human resource, etc.
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