Question

Distinguish clearly between products and services, giving examples.

Answer 1

	Basis of Distinction	Product	Service
1.	Tangibility	Fully tangible (a) Can be felt and touched. (b) Can be fully standardised.	Intangible may have physical evidence. (a) Cannot be touched. (b) Cannot be standardised.
2.	The inseparability of buyer and seller	Fully separable, remote transactions are possible.	Not separable, remote transactions are not possible.
3.	Quality	It can be measured and controlled.	Difficult to control and measure.
4.	Inventory	It can be stored for use in future.	It cannot be stored for use in future.
5.	Sensitivity to time	Low sensitivity, e.g., a soap can be bought in advance of need.	Highly sensitive, e.g., doctor's services are needed when there is a patient.
6.	Risk	The product can be replaced.	The service delivered cannot be replaced.
7.	Customisation	Increases costs and restricts sales.	Increases customer delight.
8.	Market relationship	Product and brand are the focus of the transaction.	A very important link.
9.	Brand	Main strategy in product marketing.	People are equally important.
10.	Perishability	Usually durable.	Usually perishable.
11.	Ownership	Transferable	Not transferable