The product and its properties are one of the fundamental concepts in all modern economic science. They operate in such industries as commodity production, marketing, micro and macroeconomics, and other sections of this science. Initially, the concept of goods was preceded by the concept of good, which has a broader definition. Usually it was understood as everything that had the property to satisfy emerging human needs. It could be either objects of labor or gifts of nature, while their ability to be a subject of trade did not matter, therefore, for economic science, such an interpretation was too broad and generalized.
The concept of goods, which arose a little later, is focused exclusively on the economy. It is customary to understand everything that has the property of satisfying human needs in a particular area and at the same time may be the subject of exchange or purchase and sale transactions. Moreover, the origin of this item does not matter - the product can be either a result of human activity or have a natural origin.
In other words, the product and its properties must be such that any economic entity can acquire this good to satisfy his personal needs.
What can be the cost of goods?
Usually, in everyday life, the value is usually understood as the price that must be paid for the possession of a product. But economics distinguishes two main types of value: consumer and exchange.
Under the first, it is most commonly understood to mean the value of a product in the eyes of potential consumers, that is, the ability of a particular thing or service to satisfy a person ’s need. In other words, this is the usefulness of the product to the client, that is, what marketing most often focuses on.
Under exchange value is meant a certain generalized proportion, according to which some goods can be exchanged for others. The equivalent of exchange value is monetary currency, which is a universal way of determining the average exchange value of goods.
Product and its properties in modern marketing
In order to be able to be represented on the market and reach a potential consumer, a product in a modern economy must necessarily have five inherent characteristics:
- a certain level of quality;
- individual design reflecting its specificity;
- a specific set of properties inherent only to this product;
- vintage name;
- packaging with specific differences.
The quality level is considered to be decisive for any product, since not only the exchange value of a particular service or thing, but also the success of its promotion on the market depend solely on it.
In order to be successful and to allow its manufacturer to receive a steady income, the product and its properties must favorably differ from the analogues offered by competitors. In conditions of constant economic growth and an increase in supply, the consumer seeks to choose the highest quality product with as many functions as possible.
In addition, components of usefulness and rarity are important characteristics of the product . These concepts are fundamental for determining precisely consumer value, so the exchange value of even the most useful goods will not necessarily reflect the real amount of the cost of its production. Often the usefulness of an inexpensive but vital product will be significantly higher than the usefulness of a luxury item of great material value.