Magoosh GRE

By reference to academic literature, explore and critically evaluate the concept of core benefit. Make recommendations to management from the conclusions arising from that evaluation.

| March 12, 2015

1. Introduction

Kotler and Keller (2009) suggest that marketing is generally organised at five different levels, the most basic of which is the “core benefit”, that is, the key factor about the product or service that customers buy (Kotler et al 2009). At each level, more value is added to the product. This concept will be understood and evaluated, and the practical context considered with ‘real-life’ examples. The concept is explained, with reference to examples taken from food retail (in particular, the grocery retailer Sainsburys’ range), and the notion is critiqued in the subsequent section. On the basis of the discussion of the concept, suggestions for best marketing practice will be made. While the concept is widely referred to in the literature, as part of a wider discussion about the meaning products have for consumers and how best to market them, there is relatively little detailed discussion of the particulars of how the core benefit notion can be used. In addition, the concept seems to cover a range of different interpretations in terms of what actually counts as a ‘core’ benefit. However, it does offer a useful starting point for marketing products, and captures a basic idea about what consumers are looking for.

2. The Concept of Core Benefit

Kotler’s notion of seeing products in terms of levels of impact to the consumer is one that has been widely embraced by marketing. As an analysis of the product, it is of central importance in understanding the ‘5 P’s’ of marketing (product, place, price, promotion and people) (Moore and Pareek 2010), and hence in developing a useful marketing strategy for any product or service.

Kotler sees marketing as a process of benefiting the consumer through a social interaction in which both parties obtain what they need through a process which adds value. He distinguishes between ‘needs’, ‘wants’ and ‘demands’: ‘Need’ is a lack of something, ‘want’ is a defined requirement for something to satisfy a need, and ‘demand’ consists of a group of wants together with an ability to pay for an exchange (Kotler et al 2009). Overall, products can be defined in terms of the benefits they offer to consumers. The core benefit of a product is the most central. The core benefit of any product can be defined as the most basic desire (want or need) that can be addressed through buying the product. Kotler et al (2009) also suggest that the core benefit forms part of a whole, in which higher levels of product offering can be isolated. These higher levels are, in order, the generic product (those features necessary to the product for it to work), the expected product (what consumers expect the product to have, do or be), the augmented product (additional features of the product which can help distinguish the product from others in the market place in the eye of the consumer) and the potential product (what the product might become in the future) (Kotler et al 2009). While all these levels are important to understanding products, product placement and marketing, it is the core benefit which will be the main subject of the following. Sometimes these levels are simplified to just three: core benefit, actual product and augmented product (Armstrong et al 2009). In all cases, it should be noted that in order to fully understand how best to market a product, there is a need to work at more than one level simultaneously. For example, the generic product level and expected product level are both needed to turn potential into actual product. The core benefit is simply the set of solutions to consumer’s problems (Pankratius 2007). For example, in food marketing, the core benefit of the product is arguably its ability to be eaten, impart nourishment, not poison the customer, and satisfy hunger. The customer is hungry, and needs to eat to survive. All the food products on sale in the UK supermarket Sainsbury’s satisfy these basic needs, and have a similar set of core benefits. However, they differ markedly in the ways in which this ability is marketed, and whether they also satisfy additional needs and wants which the consumer has (the need to have the latest ‘must-have’ ingredient (harissa paste or wasabi peas) or the need to show they have an ethical conscience by buying organic or locally sourced products.

While it is necessary to see all the levels functioning together to understand the intricacies of marketing, it is equally possible to look at the level of core benefits alone. Additionally, the core benefits of a product are those which should be first defined when trying to develop a marketing strategy for that product (Cant et al 2009). They can be seen as the most important benefit: if the product fails to satisfy the basic requirements for that product, it is not doing its job, and no amount of marketing at other levels will help it succeed. For example, if a Sainsbury’s food product tasted bad and failed to satisfy hunger, it is unlikely people would buy it again, despite the attractiveness of the packaging. But what do core benefits involve in detail? Serling (2006) sees them as dynamic properties of products, suggesting the core benefit is either, for a buyer “a solution to their most difficult problems” or “ways to achieve their most important goals” (Serling 2006, p. 27). While this is part of the concept, it is perhaps too limiting: the core benefit of a food product is its ability to satisfy hunger and so on, but few consumers would define this as their most difficult or important problem or goal. A more general definition is suggested by Smith: “the core benefit represents the principal advantage that the consumer receives from buying and using a product” (Smith 2008, p. 109). In these terms, the core benefit of a food product is its ability to satisfy hunger and provide nourishment. Another definition is suggested by Kotler et al (2010): “the core product… consists of the major needs that will be fulfilled, wants that will be realised, and problems that will be solved by consuming this product” (Kotler et al 2010, p. 108). They also suggest that the core product benefits can be defined by answers to the customer’s question “what’s in it for me to buy this product”. Kotler also suggests (2000) that the core benefits can be described as objective properties of the product. In terms of answers to the ‘core benefit question’, we might distinguish between different sets of benefits from different products within the Sainsbury’s food range. These can be summed up in a table:

Sainsbury’s Own Brand Value Range Branded product e.g. McVities biscuits, Heinz beans Sainsbury’s ‘Taste the Difference’ premium own-brand range
Satisfy hunger Satisfy hunger Satisfy hunger
Taste acceptable Taste acceptable Taste acceptable
Taste good Taste good
Taste very good
Provide nourishment Provide nourishment Provide nourishment
Don’t cost a lot
Reliable, deliver expectations Reliable, deliver expectations
Tried and trusted
High quality
Social standing: I look like I am a discerning shopper
‘Green’ credentials
Good value
Part of a ‘community’ of buyers of this product
Table 1: core and other benefits for food products

All the product ranges share core values, but differ in the benefits at further levels. The ‘taste the difference’ range, for example, offers the consumer the opportunity to buy ethically, to buy more tasty products, and to appear to be a discerning shopper. The only ‘add on’ for the own brand range is, arguably, that connected with low cost.

The core benefit of a product should not be confused with other ways of thinking about its core features. Serling usefully points out that the core benefit should be distinguished from the USP of a product, and also, when expressed, is different from a mission statement. The USP (unique selling point) is a narrower concept which expresses one particular benefit for a marketing campaign, while the mission statement also includes corporate values which surround the product (Serling 2006).

One key concept of the notion of core benefit is the emphasis upon the customer’s need, and how the product should satisfy this need. Rather than seeing marketing as a business of pointing out the various features of a product, there is rather a need to concentrate on what the product can do for the consumer (Lao 2001). The product is likely to have a range of features which have nothing at all to do with satisfying the need. For example, in the case of food products, one feature of low cost food products (own label value brands) is that the packaging is often very simple. However, it would be nonsensical for Sainsbury’s to promote the ‘Value’ range by highlighting the simple packaging. Customers want to buy food because they are hungry, not for the packaging. Lao gives a good example: selling a selling a double strength nasal decongestant is not about selling the tablets themselves, but rather about selling relief from congestion (Lau 2001). While it is necessary to look at what customers want, it is also important to recognise that core benefits can take different forms. They can be physical, psychological, economic and social for example (Mueller 2010). It is worth looking in some detail at the way to identify the core benefit of the client, in line with Armstrong’s suggestion that we ask “what is the buyer really buying” (Armstrong et al 2009, p. 232). In the example of the Sainsbury’s product range, a mix of different benefits are on offer with a purchase of food. This is set out in table 2: there are different answers for each of the three examples in the product range.

What is the buyer really buying? Physical Psychological Economic Social
Value range product Food + packaging Convenience, hunger satisfaction, economy Low cost Moneysaving
Well-known brand Food + packaging Convenience, hunger satisfaction, trust, Average cost Popular, affiliation with many other people
‘Taste the Difference’ product Food + packaging Convenience, hunger satisfaction, good quality Higher cost Social status, discerning identity
Table 2: breakdown of core benefits

3. A Critique of the Concept

There are some inconsistencies in the way the notion of core product has been interpreted. Under one interpretation, discussed above, the core benefit of the product is simply the main demand it satisfies: “the core product is the basic form of the product… the main benefit sought by customers” (Reid and Bojanic 2009, p. 283). In the example discussed above, the core benefits are the extent to which the product satisfies hunger, tastes good and does not cost too much, for example. However, others look at the notion that the core benefit is usually tangible, that is, is objective. As a physical form, the core benefit of the product has different characteristics, including quality, packaging, brand name, features and styling. The core benefit is here distinguished from the augmented product, which are seen as the non-physical characteristics which go beyond the core (Weingand 1999). In terms of the food example defined above, the augmented benefits would include what the product says about the purchaser as a consumer. However, under this interpretation, each of the types of food product in table 1 above would be seen to have a different set of core values, some of which overlap. This is expressed in table 3:

Quality Packaging Brand Name Features Styling
Value Range Low quality, ‘cheap and cheerful’ Low cost, plain, predominantly white, few colours, images Basics Cheap, ‘what you see is what you get’, way to save money Minimal, simple
Well-known Brand Reassurance of quality Colourful, bright, known logos Heinz Baked Beans, Hobnobs etc Household brand, reliable, trustworthy, loved by many Popular, tied in with advertising, logo may be well-loved and long-known, bright
‘Taste the Difference’ High quality, locally sourced ingredients Discerning, elegant, dark, sophisticated Taste the Difference Assured quality, better tasting, nicer than other products Sophisticated, understated, upper class.
Table 3: the differing core benefits of food products offered by Sainsburys

If the core benefit of a product is seen as the main thing that product does for the consumer (Hus and Powers 2008), this also raises the possibility that an identical product might have different core benefits for different sets of consumers. For example, someone purchasing food from sainsburys’ might have hunger as the primary motivation for buying a ‘value’ loaf of bread. Another might want to buy food cheaply. For one the ability to satisfy hunger is the main core benefit, for the other, the cheapness of the item. Do we therefore need to distinguish different core benefits which the same product has, depending on what actual purchasers are looking for? Kotler et al (2010) do seem to suggest this, saying that the core benefit is made up of all the needs and wants fulfilled by the product, as well as problems which it solves.

Perhaps a more appropriate way of looking at features such as quality, packaging etc, is as part of the ‘actual product’ level, the differing combinations of features which make up the product which delivers the key benefits (Naylor 2002). However, there is a great deal of discrepancy in the literature about the details of what exactly belongs at each level. There is the confusion regarding what is actually included as part of the core benefits for example. The literature is thin on the ground in terms of examples. While the notion that the core benefit addresses the need or want of the consumer is easy to grasp, wherever this idea is broken down further there seems to be only limited agreement about what this means. Jansen, for example, explains that the core benefit is the “fundamental need or want that consumers satisfy by consuming that product or service” (Jansen 2011, p. 138). But he, as others, fail to discuss what ‘fundamental’ means. On one level, we might say that hunger, the need for food, is the ‘fundamental’ need, and hence that the core benefit of all Sainsbury’s food products is this. On another, we might argue that the need for social status is a fundamental need. In this case, only the ‘Taste the Difference’ range would include this as a core benefit. From another perspective, the need to save money might, or might not, be included in ‘fundamental’ needs, in which case only the Value range offers an appropriate core benefit. It is perhaps necessary to extend Kotler’s model through a needs analysis, such as that offered by Maslow. Maslow suggested that human needs form a hierarchy, with basic needs, those for warmth and food for example, to be satisfied first; the need for self-esteem arises once a person is fed, sheltered and warm (Pride et al 2011). Further confusion exists because of the two types of model in which core benefits occur. On the one hand, Kotler distinguishes five levels in the customer value hierarchy (Kotler et al 2010), elsewhere it is suggested that thinking of the product in terms of three levels is more appropriate (Armstrong et al 2009).

The idea of core benefit has intuitive value, and it is easy to accept the notion of a set of core aspects which make up the product, without which it would not survive. Kotler’s (2000) suggestion that we need to think about buyer needs, not product features, is also very valuable, as it means that marketers can direct their efforts to ensuring buyers get what they want, rather than selling the customer a number of product features that they are not interested in. However, while intuitively attractive, the specifics of how the concept should be applied seem inadequate, and the different levels seem to overlap, which seems confusing. There exist other theoretical models which seem more convincing, although less well known. For example, Woodruff proposes a ‘Customer Value Hierarchical Model’ which offers a more complex, but potentially more fruitful picture of the interrelationship between product features and consumer needs and desires. in the model there are three separate interconnected areas, desired product attributes, desired consequences, and customer goals, each of which also dictates a type of need (attribute based, consequence based and goal based) on the customers part (Wu and Zhou). That is, in order to understand products and how they relate to customers, each product needs to be considered in three ways. First, in terms of its attributes: what the product is, its features and parts, what it is in itself. Second, its consequences, that is, what it does for the buyer. This level covers the ways in which buyer and product interact, and includes subjective considerations and the experiences of using the product. The third level is the desired end state, the goal of the consumer, and the end result of using the product. This covers long term aspects, core values and aims, and abstract notions associated with the product (Woodruff 1997).

4. Conclusion and Recommendations

Despite some problems with the concept of ‘core benefit’, particularly the different ways in which this is interpreted and a lack of detail about the notion and how it can be used in practice, the idea is a useful one for marketing.

There are a number of recommendations to be made on the basis of the concept. First, marketing the product means thoroughly understanding its basic appeal. Who is buying it and why? What are they looking for? What is the basic need they want to fulfil? The ‘core’ benefit is precisely that, the benefit upon which all the other features of the product and what they mean for the customer rest. Therefore plenty of time should be taken to understand what the product means for the consumer, and what they ask of it.

A related recommendation is to do with the fact that the core benefit is determined by what the consumer wants, and is not defined in terms of product features. It is therefore important to focus upon customer perceptions and demands, not upon what the product can do.

Third, it is necessary to understand how the core benefit relates to, supports, and is supported by other levels of product such as the augmented product and the expected product. That is, to see how the most pressing need that the product answers relates to all the other needs that separate the product from others in the market place for example.

Finally, in order to get the most out of the concept of core benefit, it is necessary to have a working model of consumer needs, for example that provided by Maslow, covering, for example, which needs are most important and how differing needs determine purchasing behaviour.

5. References

Armstrong, G, Harker, M, Kotler, P and Brennan, R (2009) Marketing: An Introduction (9th edn.), Pearson Education, Harlow, Essex

Cant, M C, Strydom, J W, Jooste and C J (2009) Marketing Management (5th edn), Juta and Company Ltd.

Jansen, J (2011) Understanding Sponsored Search: Core Elements of Keyword Advertising, Cambridge University Press, Cambridge.

Kotler, P (2000) Marketing Management – The Millennium Edition” (10th Edn.), Prentice Hall, USA

Kotler, P, and Keller, K, (2009) A Framework for Marketing Management (4th edn), Pearson Education, Harlow, Essex.

Kotler, P, Keller, K, Brady, Goodman, M and Hansen, T (2009) Marketing management, Pearson Education, Harlow, Essex.

Kotler, P, Lee, N, Farris, P W, Bendle, N T, Pfeifer, P E, Reibstein, D J, Light, L, Kiddon, J and Reece, M (2010) Marketing Strategy from the Masters (Collection),
FT Press, UK

Kotler, P and Shalowitz, J (2010). Strategic Marketing For Health Care Organizations: Building A Customer-Driven Health System, John Wiley and Sons, USA

Lao, F (2001) Marketing Management, Rex Bookstore, Inc. USA

Moore, K and Pareek, N (2010) Marketing: the basics (2nd edn.), Routledge, Oxon

Mueller, B (2010) Dynamics of International Advertising: Theoretical and Practical Perspectives (2nd edn.) Peter Lang, Germany / New York.

Naylor, J (2002) Introduction to Operations Management (2nd edn), Pearson Education, UK

Pankratius, V (2007) Product lines for digital information products, KIT Scientific Publishing, USA

Pride, W M, Hughes, R J and Kapoor, J R (2011) Business (11th edn.), Cengage Learning, Belmont CA.

Reid, R D and Bojanic, D C (2009) Hospitality Marketing Management, John Wiley and Sons, Hoboken, NJ.

Serling, B (2006) How to Market Your Way to a Million Dollar Professional Service Practice, BDS Resources, Inc, USA

Smith, A (2008) Introduction to sport marketing, Routledge, UK

Weingand, D E (1999) Marketing/planning library and information services (2nd edn), Libraries Unlimited, Englewood CO.

Woodruff, R B and Gardial, S (1996) Know your customer: new approaches to understanding customer value and satisfaction, Wiley-Blackwell, UK

Woodruff, R B (1997) ‘Customer value: The next source for competitive advantage’,
Academy of Marketing Science Journal, 25:2, 139-153.

Wu, D D and Zhou, Y (2011) Modeling Risk Management for Resources and Environment in China, Springer, Heidelberg, Dordrecht, London, New York.

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