There are several ways through which the differentiation between services and goods can be made. The basic characteristics of services can easily help in differentiating between the two and provide a better explanation about using services as products. The characteristics of services as products are given as below:
Intangibility: Intangible products means that products with no physical form, i.e., products that can not be touched. Traditionally goods are perceived as the only products that a company produces, but the growing use of services as products from big companies has changed this pattern.
Imperishability: Products that have no physical form and can’t be touched have no scope of perishing. However, bad service quality is an issue and can be categorized as perishable. However, if the actual product does not exist, can not be destroyed; that is how goods differ from services.
Inseparability: Goods and physical products can be stored and thus sold without the producer’s requirement, but services can only be achieved if the service provider is available. Without the service provider, the services do not exist, therefore, both cannot be separated.
Standardization: Produced goods and their quality can be determined before buying or through a sample, but it is difficult to determine the quality of services in the case of services. The quality of the services can be determined only after using them, and it may differ every time as well.
Types of Services as Products
Services as products cannot be considered general in a single category. Instead, it has two major parts: Pure services, Core Services and Core goods. Both the categories are mentioned below.
Pure Services: Pure services are those which only provide services to the customers, and no involvement of goods is there. The services in it are purely intangible and do not provide any ownership of the goods to the customers. Examples of pure services are Teaching, Financial Advice, and Medical Consultancy.
Core Services: Core services are the combination of service and goods; in this type of service, the customers are provided goods and services. The presence of tangible items is important to quality as core services. Examples are Flights, Hotels, Internet Services, and Cleaning services.
Core Goods: Core goods are quite similar to core services, but the major difference between them is the ownership aspect of the product. Hereafter buying the product, the customer may require services to maintain that particular product—for example, Electronic Appliances, Automobiles, and Data storage services.
Importance of Services as Products
Services are a part of products offered by any company, majorly the companies that produce products and services are not much of a concern, but due to the rising need of services in the industry, it has led to a huge demand of services in the sector. With the increase in technology companies and other products consumed by the customer, the demand for quality products and services is rising. The importance of services is also slowly being recognized by the customer. Along with the products, the services provided by the companies play a major role in the company’s success.
Everything that a company or organization provides is called a product. Products have two categories which are: services and goods. Goods as products are tangible items produced and sold by any company. The buyers have full ownership of the products and can touch their products. Whereas services as products are when any company provides a service to its customers, the buyer does not have ownership of any goods, and such projects can not be touched. However, service as the product does not necessarily mean that it only provides intangible services. It could also be a mix of both goods and services. For example, a restaurant provides people with the goods (i.e. food and drinks) and services such as proper hospitality provided by the staff, including the waiters, etc.
Services as products can be provided in many forms to the customer, one of the latest and the most used such example is the services provided by the technology companies. If a person buys a laptop or any other device from any company, they might need to purchase some software and the customer services provided by the vendor with it. Insurance and warranty of any device will also come under the service as a product classification category. The banking, retailing, and transportation sector are some of the old-school providers of services as products. This has extended to many other sectors that realize that providing good services with the goods is an important task and increases the customer’s support for the company.
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