Augmented product

Augmented product allows company to better fulfill customer's individual expectancy. It is a base product with additional features that give customer additional value. The consumer usually benefits from these services, which are immaterial. The augmented product is also one of the elements of competitive advantage. Additional services distinguish the product and make it attractive especially when they use innovations and current technological achievements.

Product structure its features and elements

Augmented product is one of four levels of structure products. The most common application is the Kotler classification in which these levels take the following names:

• the core of the product (reason for purchase) - is consists of basic benefits that meet the needs of buyers. It indicates functional physical features and other possibilities of a given product;
• the real product (perception of the product) - product with the properties expected by the buyer for example price, quality, packaging;
• the augmented product (additional benefits);
• the potential product (future improvements) - product modified in terms of future needs and expectations od customers;

In the age of overproduction it is difficult not to manufacture, but to sell. Therefore, manufacturers have to distinguish their products from competition. Augmented product is one of the ways of reaching that objective. In this day and age many manufacturers try to implement mass customization as next level of augmenting the product. Mass customization allows for mass production where each product is customized for the customer. It is used widely in automotive. The modern market creates great opportunities to choose among products that compete with each other's range, type ang strength of satisfation offered to consumers. A product thah is equipped with an easily perceptible and, if possible, unique fabric generates a specific image in the consumer's consciousness. These properties are particularly important in markets of consumer goods and services, especially in the retail trade.

Almost every product can be augmented. Usual ways of augmenting are adding additional features or service. Augmented product can be served by several suppliers: the main product served by manufacturer and additional services by another company (based on contract).

The augmented product includes

• repair and maintenance of the product puschased by the customer;
• instruction and instalation enabling customers to get acquainted with the product in depth;
• a loan that allows each customer to purchase a product;
• complaints allow customers to claim their claims in the case of unsatisfactory quality of goods or services;
• guarantees allowing customers to file a complaint;
• delivery thanks to witch the goods are delivered door to door;
• spare parts;
• empathy of service which makes the customer after a successful purchase feel like returning to the services point onece again;
• availability of service outlets if wide provides the customer with the opportunity to choose the nearest point of purchase;
• readiness to provide services;
• additional services through which all other services related to the product are understood.

Examples of augmented product

In case of selling flowers, vendor can add additional greeting card to every bouquet or offer delivery.

In the case of Xbox purchase the seller in order to distinguish his product on the competitive market may offer equipment insurance in the event of mechanical damage, free customer service, free game in the set or a one-year warranty extended. Product features that are more visible make the product more attractive and can be more successful.

If you buy a computer the seller can provide an ergonomic casing, keyboard or tablet with a product that extends actual product. Sellers can also offer a free internet package.

Advantages of Augmented product

Augmented product offers a variety of advantages to the companies that use it. These include:

• Increased customer satisfaction by providing a superior product, with additional features that meet individual customers' needs and expectations.
• Enhanced competitive advantage by creating a unique product that differentiates it from other similar products in the market.
• Increased loyalty from customers by providing them with additional features and benefits that cannot be found in other products.
• Increased revenue and profits due to the additional features and services that customers are willing to pay for.
• Improved customer service by offering a more personalized experience that meets customers’ individual needs.
• Increased brand recognition and awareness by providing a unique product with features and benefits that are not found in the competitors’ products.

Limitations of Augmented product

Augmented products can be limited in several ways:

• Cost: Adding additional features to a product often increases its overall cost. This can be a disadvantage for customers who are budget-conscious and may be unable to afford the more expensive product.
• Limited compatibility: Augmented products often require additional hardware and software components to be compatible with other products and services in the market. This can limit the product’s reach and exclude potential customers who don’t have access to the necessary technology.
• Durability: Augmented products that rely on technology may be more prone to malfunction and require frequent maintenance. This can be a disadvantage for customers who are looking for more reliable products.
• Complexity: Augmented products can be more difficult to use and understand than traditional products. This can make it difficult for customers to take full advantage of the product’s features.

Other approaches related to Augmented product

Augmented product is important part of any business strategy. Other approaches related to it, include:

• Product Line Extension - introducing a line of products with additional features, that build on the existing base product and make it more attractive to customers.
• Product Differentiation - offering a product or service with unique or special features that can differentiate it from its competitors.
• Price Discrimination - setting different prices for different customers based on their individual needs or requirements.
• Product Personalization - allowing customers to customize products or services to meet their individual needs or preferences.
• Brand Extensions - extending a company's existing brand to new products or services.

These approaches to Augmented product are important for businesses to remain competitive and to create products or services that meet customers’ expectations. By offering additional features, businesses can create a product or service that is more attractive and valuable to customers.

Augmented product — recommended articles

Basic product — Imitator strategy — Product differentiation strategy — Private label products — Product line pricing — Prestige products — High involvement product — Skimming pricing strategy — Competitive product

References

• Nicolai, T., Resatsch, F., Michelis, D. (2005). The Web of Augmented Physiacal Objects. Mobilie Business,2005. ICMB 2005. International Conference on, 340-346, 2005.
• Ravald, A., Grönroos Ch. (1996). The value concept and relationship marketing. European journal of marketing 30 (2), 19-30, 1996.
• Salomon, A. J., & Amrani, O. (2005). Augmented product codes and lattices: Reed-Muller codes and Barnes-Wall lattices. IEEE Transactions on Information Theory, 51(11), 3918-3930.

Footnotes

Author: Magdalena Stanaszek