Question

Distinguish between a product and a service.

Explain the difference between products and services.

Answer 1

Basis of Distinction	Products	Services
1. Tangibility	Fully tangible (a) Calil be felt and touched (b) Can be fully standardised	Intangible may have physical evidence. (a) Cannot be touched (b) Cannot be standardised
2. Perishability	Usually durable	Usually perishable
3. Ownership	Transferable	Not transferable
4. Inseparability of buyer and seller	Fully separable, remote transactions are possible.	Not separable, remote transactions are not possible.
5. Risk	The product can be replaced.	The service delivered cannot be replaced.
6. Quality	Can be measured and controlled.	Difficult to control and measure.
7. Inventory	Can be stored.	Cannot be stored.
8. 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.
9. Customisation	Increases costs and restricts sales.	Increases customer delight.
10. Market relationship	Product and brand are the focus of the transaction.	A very important link.
11. Brand	Main strategy in product marketing.	People are equally important.