In marketing, we first focus on the benefits that customer desire (since this is what really motivates purchase decisions), and later, as a tactical issue, we focus on the product or service attributes that provide those benefits. In my experience, people have trouble understanding the difference between these various ideas, so the discussion below is my attempt to help.
So to begin, lets consider how we can determine whether we are dealing with an attribute or a benefit. You might refer to the picture below to help you with some of the concepts
CONCRETE AND ABSTRACT PRODUCT ATTRIBUTES VS. CUSTOMER BENEFITS
The first thing to note is that product attributes reside in the product, while benefits reside in the customer. For example, a car can have 4-wheel drive (a concrete attribute) and provide a benefit to a customer of being able to go various places. A computer can have a microprocessor with a fast clock speed (a concrete attribute) and provide the benefit of being able to get your job done faster.
You will note that product attributes tend to be concrete, but they can also be abstract. Think, for example, of a fast microprocessor. There is a more abstract way of thinking of this attribute by using the term "performance."
Benefits are always abstract, and they are often the result of a cluster of product attributes, some of which may be abstract attributes. For example, think of safety (say in a car). There is a cluster of concrete product attributes (e.g., air bags, brakes, and body construction) that give rise to the more abstract concept of the benefit of safety. But note that "safety" can also be applied to the car (so its an abstract product attribute). Many times, abstract product attributes are closely related to benefits. When they are, you do not get much benefit out of making a distinction between attributes and benefits.
Given this discussion, you can see that it is often easier to think about what a customer buys by thinking along the continuum of concrete versus abstract ideas, regardless of whether we label it an attribute or a benefit. Since we are primarily interested in the abstract ideas (since this is what customers really buy), you might use the term "factor" rather than attribute or benefit, just making sure that the factor is abstract. In this tutorial, however, we will tend to use the term "benefit" to refer to these abstract ideas (i.e., both abstract attributes and benefits).
ARE YOU TOO HIGH?
Since what customers buy are abstract concepts, it is easy to think in terms of concepts that are simply at too high a level of abstraction. Several of these concepts are well known. Take for example the generic words "value" and "quality". What do these mean? Well, in fact, if you ask people to define these concepts you will likely find several answers, since they are so general that they are often meaningless. But are these useful to marketing a product?
Actually, you can find the benefits underlying these more general concepts by asking the simple question: What do you mean by that? This is from an old technique called "funneling." For example, if you say that "value" is a benefit that customers are looking for in a product or service, then ask yourself (or better yet, the customer) "What do you mean by that?" What you will typically find is that people will respond by using less abstract and more meaningful words, like "a low price". Quality works the same way. If you ask, "what do you mean by that?" you will find that quality actually refers to specific benefits that customers are seeking. For example, depending on the product category, quality may refer to "good tasting coffee" or "reliability" or even "safety".
If you keep asking the question, "what do you mean by that?" you will eventually find that you can only answer this question by using tactics or concrete product attributes. When you hit this point, you have typically found the right level to describe a customer benefit. For example, if you ask "what do you mean by that?" to "good tasting coffee", you probably can only answer that question by referring to the concrete beans and roasting equipment that are used.
With this technique in mind, you might now consider the other major ideas that typically follow under the heading of customer benefits (but are simply too high). These include: "reputation", "image", or the ultimately useless idea (that I often hear) "it works the way I expect it to work."
You might note that some people consider reputation to have many aspects, including a reputation for vision/leadership, social responsibiliy, emotional appeal, and products.
BENEFITS VARY ALONG A DIMENSION
We need to understand one final aspect of benefits. That is, benefits that are useful to marketing decisions are those which vary along a dimension. This is because an important aspect of marketing is understanding how firms or brands stand in their perceived delivery of benefits. What do I mean by a "dimension"?
Take for example, the idea of "location", which is often thought of as a benefit to customers. But it really isn't. Why? Well, the answer lies in the fact that "location" is a dimension, but we didnt know how stores vary along the location dimension. You can figure out if there is variance because there must be endpoints for the dimension. For example, the location dimension may have the endpoints "close" and "far". Or, even better for the product category we were looking at, location could have the endpoints "near to other shopping goods" and "far from other shopping goods."
As another example, think about atmosphere. What are the endpoints of this dimension? Perhaps "hip/cool" versus "conservative/uptight."
The point is that the benefits that customers use to judge products and services vary along relevant dimensions, and thus we need to identify not just the general dimension, but the endpoints as well. Finally, note that these endpoints can usually be discovered by again asking the question "What do you mean by that?"
With this in mind, you can apply a simple test to see whether what you think customers buy is indeed useful (for marketing purposes).
- It must not be concrete, or tactical.
- It must not be at too high a level of abstraction (think, "what do you mean by that?")
- It must vary across a dimension (there must be endpoints).
WHAT DO I DO NOW?
Now, with benefits and abstract attibutes understood, think about all the benefits and abstract attributes that customers in your market think about when considering your product/service versus those of the competition. Write them down. Don't list just the ones you think you're good at, but all the ones any customer may use to judge you versus the competition.
Before segmenting the market, you next need to understand how customers make trade-offs.