1.
Classification of Products
Products are categorized to help businesses tailor their marketing, pricing, and
distribution strategies.
● Consumer Goods: Based on buying habits.
o Convenience Goods: Low-cost, frequently purchased items with minimal effort
(e.g., milk, snacks).
o Shopping Goods: Products compared on price, quality, and style (e.g., clothing,
electronics).
o Specialty Goods: Unique items with strong brand loyalty where consumers make a
special effort to buy (e.g., luxury cars, high-end watches).
o Unsought Goods: Products consumers don't normally think of buying until needed
(e.g., life insurance, fire extinguishers).
● Industrial Goods: Based on how they enter the production process.
o Materials and Parts: Raw materials (wheat, iron ore) and manufactured
components (cement, small motors).
o Capital Items: Long-lasting goods that facilitate production (factories, generators,
tools).
o Supplies and Services: Short-term items (paper, lubricants) and business services
(legal, maintenance).
2. Product Specifications
A Product Specification (or "spec") is a blueprint document outlining the
requirements of a product.
● Purpose: Summarizes what is being built, why it's being built, and how it will look
and function.
● Components: Often includes user stories, personas, technical constraints, and
specific performance goals.
3. Product Life Cycle (PLC)
The PLC maps the journey of a product from its initial concept to its removal from the
market.
1. Development: The "incubation" phase. High R&D costs, no revenue, focus on
prototyping and market validation.
2. Introduction: Market launch. Characterized by low sales, high marketing costs to
build awareness, and negative profits.
3. Growth: Rapid increase in sales and profits. Competition begins to enter, and the
focus shifts to brand preference and expansion.
4. Maturity: Sales peak and stabilize. Intense competition requires differentiation (new
features, price cuts) to maintain market share.
5. Decline: Sales and profits fall due to market saturation, new technology, or changing
tastes.
4. Product Mix
The Product Mix (or assortment) is the complete set of all product lines and items
offered by a seller.
● Dimensions:
o Width: The number of different product lines carried by the company.
o Length: The total number of items in the entire product mix.
o Depth: The number of versions (sizes, colors, flavors) offered in each product line.
o Consistency: How closely related the various product lines are in end-use,
production, or distribution.
5. Product Design & Development Process
Modern product development is a sequence of steps to transform an idea into a
commercial product.
● Product Design: The process of devising a system or component to meet desired
needs, involving synthesis, analysis, and evaluation.
● Development Stages:
1. Idea Generation: Sourcing ideas from customers, employees, or researchers.
2. Idea Screening: Filtering ideas to eliminate those with low potential.
3. Concept Development & Testing: Testing product concepts with target consumers.
4. Business Analysis: Reviewing sales, costs, and profit projections.
5. Prototyping: Developing a physical or digital version of the product.
6. Market Testing: Releasing the product to a limited market for feedback.
7. Commercialization: Full-scale market launch.
6. Innovative Thinking in Product Development
Innovation is crucial for extending a product's life and remaining competitive.
● Continuous Improvement: Modern engineers must think innovatively to meet
social, environmental, and global demands.
● Extension Strategies: Using innovation to push a mature product back into a
growth phase (e.g., finding new uses for Baking Soda).
● Team Collaboration: Innovation is now a group experience involving design,
manufacturing, and materials specialists to solve complex problems.
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1. Classification of Products
Products are categorized to define how they are marketed, priced, and the engineering
logistics required to distribute them. They are broadly divided into Consumer and Industrial
goods.
A. Consumer Goods
Products bought by end-users for personal consumption.
Type Definition Engineering/Tech Example
Convenience Low-cost, frequent purchases AA Batteries, generic USB cables,
Goods with minimal effort. LED bulbs.
Products where consumers
Shopping Laptops, smartphones, washing
compare suitability, quality,
Goods machines.
price, and style.
Unique items with brand High-end Gaming Rigs (e.g.,
Specialty
loyalty; buyers make a special Alienware), professional DSLR
Goods
effort to find them. cameras, luxury EVs.
Products consumers don't think
Unsought Smoke detectors, antivirus software,
of buying until absolutely
Goods spare tires.
needed.
B. Industrial Goods
Products purchased for further processing or for use in conducting a business. This is where
most engineers work.
● Materials and Parts: Raw materials (e.g., crude oil, steel beams) and manufactured
parts (e.g., microchips, ball bearings).
● Capital Items: Long-lasting goods that facilitate production.
o Installations: Factories, assembly lines.
o Equipment: Forklifts, 3D printers, CNC machines.
● Supplies and Services: Operating supplies (lubricants, paper) and maintenance
services (HVAC repair, legal consulting).
2. Product Specifications ("Specs")
A Product Specification is the engineering blueprint. It translates abstract marketing needs
into concrete technical requirements.
● Purpose: To define exactly what is being built to avoid ambiguity between the design
team and the client.
● Key Components:
o User Personas: Who is using it? (e.g., "A construction worker wearing
gloves").
o Technical Constraints: Limits on weight, size, power consumption, or
material costs.
o Performance Metrics: Speed, latency, tensile strength, or battery life.
Engineering Tip: A vague spec ("Make it fast") leads to failure. A good spec ("Must
accelerate 0-60mph in under 3.5 seconds") leads to a testable product.
3. Product Life Cycle (PLC)
The PLC maps the sales and profit trajectory of a product from "womb to tomb." Engineering
responsibilities shift during each phase.
● Development (Incubation):
o Status: Zero revenue, high investment.
o Engineering Focus: R&D, rapid prototyping, proof of concept, feasibility
testing.
● Introduction:
o Status: Product launch, low sales, high marketing cost.
o Engineering Focus: Fixing "teething issues," scaling up manufacturing,
technical support.
● Growth:
o Status: Rapid sales rise, competitors enter the market.
o Engineering Focus: Optimizing production lines for volume, adding
variations (colors/sizes).
● Maturity:
o Status: Peak sales, market saturation.
o Engineering Focus: Value Engineering (reducing cost without losing
quality), process optimization to maintain margins.
● Decline:
o Status: Falling sales due to obsolescence.
o Engineering Focus: Phasing out production lines, salvaging parts, managing
e-waste.
4. Product Mix (The Assortment)
The Product Mix is the total portfolio of a company. Understanding this helps engineers
understand how their specific project fits into the bigger picture.
● Width: The number of different product lines.
o Example: Samsung sells Phones, Fridges, TVs, and Chips (Wide mix).
● Length: The total number of items in the mix.
● Depth: The variations (versions) of each product in the line.
o Example: An iPhone comes in 128GB, 256GB, Pro, and Max versions (High
depth).
● Consistency: How related the lines are in terms of production requirements.
o Engineering Context: High consistency allows for economies of scale (using
the same factory for multiple products).
5. Product Design & Development Process
Modern engineering transforms an idea into a commercial reality through a structured "Stage-
Gate" process.
1. Idea Generation: Brainstorming (Sources: Customer complaints, R&D
breakthroughs).
2. Idea Screening: Feasibility check. Can we actually build this with current tech? Is it
profitable?
3. Concept Development: Creating the "theory" of the product and testing it with
potential users.
4. Business Analysis: The math. Estimating Bill of Materials (BOM) cost vs. projected
sales price.
5. Prototyping:
o Alpha Prototype: Does it work? (Functional)
o Beta Prototype: Does it look right and survive use? (Aesthetic/Durability)
6. Market Testing: Small batch release to a test region or user group to catch final bugs.
7. Commercialization: Full-scale mass production and launch.
6. Innovative Thinking in Product Development
Innovation is not just about "new inventions"; it is about extending the life and value of a
product.
● Continuous Improvement (Kaizen): Small, incremental changes to design or
manufacturing to improve quality and reduce waste.
● Extension Strategies: Engineering new uses for old products to restart growth.
o Example: Repurposing simple GPU chips originally for gaming to power AI
and Machine Learning data centers.
● Team Collaboration:
o Concurrent Engineering: Design, manufacturing, and marketing teams
working simultaneously rather than sequentially to reduce time-to-market.