By: Roberta M. Fisher, Gadd Business Consultants
These two words are often used interchangeably to describe one thing and in actuality it is something different. The main difference between them is products are tangible objects that can be seen, felt and can be moved, whereas, services are intangible and cannot be moved.
Key Features of a Product
The main character of a product is that it is a physical item that is tangible. When the sale is completed the item can be moved, returned or replaced and can be exchanged for the correct item.
The value of a product is based on the consumer’s belief of what it is worth to them. If they have a desire to own the product the consumer will place a value on it themselves based on their needs and wants.
A product can be owned and said ownership can be transferred from the provider to the purchaser at time of sale.
On a customer care perspective a product is limited. The elements of branding and additional features of the product can help separate like products that will attract customers.
Key Features of a Service
A service is defined as work that is completed by a person for another individual. The quality of the service from an organization is often what motivates customers to purchase the service not the product itself. Once a customer is satisfied with the service, they will become repeat customers and will recommend others to the service.
A service can and usually has continuous billing cycles to continue supplying the service. A service cannot be returned to the provider since it is an intangible item.
Services are all about their variability, services can vary from provider to provider based on where, when and how you want the service. The provider is the main one to determine the value of a service. Consumers can only place a value on it after it is purchased.
Marketers of a service must base the pricing on what they believe the customers needs and wants and needs to stay focused on knowing and providing the features on what the customers are told what they need and want from a service.
Summary of Key Differences Between Products and Services
Value decided by customer Value determined by the service provider
Customer care is limited Customer care is critical tool in marking service
Has shelf life Service is perishable
Product can be stored Service is perishable and cannot be stored
Product can be owned Service cannot be owned even after buying it
Quality depends on its future Service provider shapes its quality
Returnable Cannot be returned
Easy to compare products qualities Difficult to compare qualities
Product and service are words that are not interchangeable. Products are tangible and physical, and services are intangible and cannot be held. The quality of a products is determined by the customers and a service’s quality is determined by the provider. A product can be stores and a service is consumed at the time of sale. A service is non-returnable.