Product Strategy

There are five product levels : Core benefit, Basic product, Expected product, Augmented product, Potential product

Core Benefit : It is the service or benefit the product is offering. In a soft drink, a consumer is buying the product to quench the thirst while dining at a restaurant, hotel or on a hot day.

Basic product : The core benefit triggers the basic product. For a soft drink, the basic requirements are soda fizz & sweetened.

Expected product : These are attributes expected by the consumer from the product. In case of Pepsi, it must be served chilled to get the real taste of the drink.

Augmented product : It is a differentiated product that is made to exceed a consumer's expectations. Pepsi offers Diet Pepsi which is a non-sweetened soft drink for the ones who are health conscious but are not ready to give up their loyalty for Pepsi while choosing a drink.

Potential product : This is where the company looks for innovate ways to satiate the consumer. It comes for a new to the category/ sub-category and also hence forms a new life cycle. 

The above 5 levels unite with the 3C model and hence we get a better understanding of where each of them lie in the model 

Customer : The core benefit lies with the customer. It is a realization that the customer has. When he/she is thirsty while having a meal at Dominos or McDonalds, only then a product like Pepsi comes into play to satisfy the requirement and quench the thirst. Also, a customer has minimum expectations from a product. In this case, it expects the drink to have fizz and be served cold. This is what is an expected product.

Company : The basic product lies with the company, which, in this case is a carbonated soft drink that is sweet in taste.

In the growth stage of a product's life cycle, the company looks of ways to innovate by coming out with new products to satisfy customers. In the case of Pepsi, Mountain Dew was a new to the category product launched and it was a flavored soft drink. This is a potential product introduced in the market, with a new offering to the customer.

Competitor : Basic , augmented and potential product all three get elements from a competitor's point of view. In a basic product, a competitor like Coca-Cola is also serving the same requirements that Pepsi is. It is only slightly less sweet in taste. 

In augmented product, when the company does a differentiation to the product, its oncoming in the market is a potential threat to competitors. Diet Pepsi provides a sugar free carbonated drink which is a different version of the Pepsi, catering to those who feel like having Pepsi but fear about the calories.

Lastly, a potential product is that with a new life cycle and is an innovation that the company seeks for probably in a new to a category/ sub-category product. It does create competition as a new entrant in the category with a different customer value that is offered. Eg. Sprite

For Pepsi, the product hierarchy is as follows :

To draw a link with 3C model ,