{"id":83776,"date":"2025-03-14T10:32:46","date_gmt":"2025-03-14T10:32:46","guid":{"rendered":"https:\/\/www.prodpad.com\/?post_type=pp_glossary&#038;p=83776"},"modified":"2025-03-14T10:32:47","modified_gmt":"2025-03-14T10:32:47","slug":"three-levels-of-product","status":"publish","type":"pp_glossary","link":"https:\/\/www.prodpad.com\/glossary\/three-levels-of-product\/","title":{"rendered":"Three Levels of Product"},"content":{"rendered":"\n<section class=\"page-section content-dark page-section__main-content\" style=\"\"><div class=\"container\">\n<div class=\"row fd-row-lg is-style-default\">\n<div class=\"col\"><\/div>\n\n\n\n<div class=\"col-6\">\n<h2 class=\"wp-block-heading\" id=\"h-what-are-the-three-levels-of-product-nbsp\">What are the three levels of product?&nbsp;<\/h2>\n\n\n\n<p>The three levels of product framework explains how a product is more than just its physical form, and that it\u2019s made up of different layers of value that influences customer perception.&nbsp;<\/p>\n\n\n\n<p>These three levels are<strong> the core product<\/strong> (the fundamental benefit or need it fulfills), <strong>the actual product<\/strong> (the tangible item with its features and design), and <strong>the augmented product<\/strong> (the additional services or benefits that enhance its value).<\/p>\n\n\n\n<p>Think of a product like an onion &#8211; layered, complex, but (hopefully) not something that makes customers cry. To truly understand what you&#8217;re offering, you need to break it down into the three product levels:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Core Product<\/strong> \u2013 The fundamental reason a customer wants it.<\/li>\n\n\n\n<li><strong>Actual Product<\/strong> \u2013 The tangible thing they\u2019re buying.<\/li>\n\n\n\n<li><strong>Augmented Product<\/strong> \u2013 The extras that sweeten the deal.<\/li>\n<\/ul>\n\n\n\n<p>These three layers come together to form the <em>total product concept<\/em>: a handy framework that helps <a href=\"https:\/\/www.prodpad.com\/glossary\/product-marketing-manager\/\">Product Marketing Managers<\/a> (and the rest of the team) clearly communicate the full value of what they\u2019re offering.&nbsp;<\/p>\n\n\n\n<p>By considering all three levels, you can better meet customer needs, exceed expectations, and build products that don\u2019t just compete but stand out in the market.<\/p>\n\n\n\n<p>Let\u2019s take a look at these in more detail:<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-core-product-definition\">Core product definition<\/h4>\n\n\n\n<p>This is the fundamental benefit of your product or service. The <em>why<\/em> behind your product &#8211; the core benefit that solves a problem or fulfills a need. It\u2019s not the physical thing itself, but the value it delivers.&nbsp;<\/p>\n\n\n\n<p>Take a car, for example. The core product isn\u2019t the vehicle; it\u2019s the ability to travel quickly and conveniently.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-actual-product-definition\">Actual product definition<\/h4>\n\n\n\n<p>This is the product in its tangible form, describing the design, product features, brand, and quality. It\u2019s what the customer physically receives when buying your product.<\/p>\n\n\n\n<p>Sticking with our car example, this includes the sleek exterior, the horsepower, the leather seats, and the logo on the front.&nbsp;<\/p>\n\n\n\n<h4 class=\"wp-block-heading\" id=\"h-augmented-product-definition\">Augmented product definition<\/h4>\n\n\n\n<p>This is where you go beyond the basics.&nbsp; Warranties, customer support, free maintenance &#8211; the extra details and additional features that set your product apart from competitors.&nbsp;<\/p>\n\n\n\n<p>In the car world, it\u2019s that bumper-to-bumper warranty, roadside assistance, 24\/7 customer service, or the free coffee at the dealership.<\/p>\n\n\n\n<p>By understanding and optimizing these three levels, you\u2019re not just selling a product, you\u2019re delivering an experience that customers actually want (and will pay for).<\/p>\n<\/div>\n\n\n\n<div class=\"col\"><\/div>\n<\/div>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-full is-resized\"><img loading=\"lazy\" decoding=\"async\" width=\"999\" height=\"713\" src=\"https:\/\/www.prodpad.com\/wp-content\/uploads\/2025\/03\/Three-Levels-of-Product-2.webp\" alt=\"Diagram of the three levels of product\" class=\"wp-image-83778\" style=\"width:800px\" srcset=\"https:\/\/www.prodpad.com\/wp-content\/uploads\/2025\/03\/Three-Levels-of-Product-2.webp 999w, https:\/\/www.prodpad.com\/wp-content\/uploads\/2025\/03\/Three-Levels-of-Product-2-300x214.webp 300w, https:\/\/www.prodpad.com\/wp-content\/uploads\/2025\/03\/Three-Levels-of-Product-2-768x548.webp 768w\" sizes=\"auto, (max-width: 999px) 100vw, 999px\" \/><\/figure>\n<\/div>\n\n\n<div class=\"row fd-row-lg is-style-default\">\n<div class=\"col\"><\/div>\n\n\n\n<div class=\"col-6\">\n<h2 class=\"wp-block-heading\">Who created the three levels of product?<\/h2>\n\n\n\n<p>The Three Levels of a Product framework was first introduced by the father of modern marketing, <a href=\"https:\/\/www.pkotler.org\/\">Philip Kotler<\/a>, with the concept of a core product making its debut in his work all the way back in 1967.&nbsp;<\/p>\n\n\n\n<p>Decades later, this model is still a go-to tool for teams looking to clearly define and communicate the value of their product.<\/p>\n\n\n\n<p>Kotler actually developed a deeper and more detailed framework called the <strong>Five Levels of a Product framework<\/strong>. Think of this three-level version as a more streamlined version of its chunkier sibling.&nbsp;<\/p>\n\n\n\n<p>While the five-level model dives deeper, the three-level version keeps things simple, making it easier to understand how a product goes beyond just its core benefit.<\/p>\n\n\n\n<p>For context, Kotler\u2019s five levels are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Core Benefit<\/strong> \u2013 The fundamental reason a customer needs the product.<\/li>\n\n\n\n<li><strong>Generic Product<\/strong> \u2013 The basic, no-frills version of the product.<\/li>\n\n\n\n<li><strong>Expected Product<\/strong> \u2013 The product features customers <em>expect<\/em> as standard.<\/li>\n\n\n\n<li><strong>Augmented Product<\/strong> \u2013 The extras that enhance the product and add value.<\/li>\n\n\n\n<li><strong>Potential Product<\/strong> \u2013 The future possibilities and innovations that could be added.<\/li>\n<\/ul>\n\n\n\n<p>To create the three levels of product, Kotler trimmed things down, removing <em>Potential Product<\/em> and <em>Generic Product<\/em>, while renaming <em>Expected Product<\/em> to <em>Actual Product<\/em>. The result? A practical, easy-to-use framework that helps teams better understand what they\u2019re really offering.<\/p>\n\n\n\n<p>Kotler\u2019s influence on Product Marketing doesn\u2019t stop here. He\u2019s also the mastermind behind the Kotler Pricing Strategy Matrix, a must-know framework for pricing decisions.&nbsp;<\/p>\n\n\n\n<p>Check out our article on Product Pricing Strategies to dive deeper.<\/p>\n\n\n<div class=\"callout callout__inline-cta flex\">\n    <div class=\"callout__content\">\n        <p class=\"font-weight-bold\">Product Pricing Strategies: Choosing the Right Approach for You<\/p>\n    <\/div>\n    <div class=\"callout__cta btn-group\">\n        <a href=\"https:\/\/www.prodpad.com\/blog\/product-pricing-strategies\/\" class=\"btn btn--cta\" rel=\"noopener\">Read now<\/a>\n    <\/div>\n<\/div>\n\n\n\n\n<h2 class=\"wp-block-heading\">What\u2019s the purpose of the three levels of product?<\/h2>\n\n\n\n<p>The three product level model helps businesses build products that truly meet customer needs while standing out in the market. It\u2019s more than just a way to categorize features, it\u2019s a tool for crafting a stronger <a href=\"https:\/\/www.prodpad.com\/glossary\/value-proposition\/\">value proposition<\/a> and refining strategy. Here\u2019s why it matters:<\/p>\n\n\n\n<p><strong>\ud83c\udfaf Customer-centric thinking:<\/strong> It shifts the focus beyond the physical product, ensuring teams consider the <em>real<\/em> benefit customers are seeking.<\/p>\n\n\n\n<p><strong>\u2728 Value creation:<\/strong> Looking at all three levels helps businesses add extra value, especially through the augmented product, where differentiation happens.<\/p>\n\n\n\n<p><strong>\ud83d\udce2 Smarter marketing strategies:<\/strong> Highlighting different product levels makes it easier to craft targeted messaging that attracts and retains customers.<\/p>\n\n\n\n<p><strong>\ud83d\udee0\ufe0f Clearer product development:<\/strong> It provides a structured way to develop products, ensuring every level &#8211; from core benefit to added services &#8211; is thoughtfully designed.<\/p>\n\n\n\n<p><strong>\ud83c\udfc6 Competitive advantage:<\/strong> Understanding these layers helps businesses identify where they can outperform rivals, whether through better features or standout services.<\/p>\n\n\n\n<p><strong>\ud83d\udcb0 Stronger price justification:<\/strong> By clearly defining the value at each level, you can can better justify <a href=\"https:\/\/www.prodpad.com\/blog\/saas-pricing-models\/\">pricing models<\/a> and communicate why your product is worth the price tag.<\/p>\n\n\n\n<p><strong>\ud83d\udd04 Better expectation management:<\/strong> A well-defined product structure ensures customers know what to expect, reducing dissatisfaction and boosting customer satisfaction.<\/p>\n\n\n\n<p><strong>\ud83d\ude80 Brand positioning:<\/strong> The framework helps teams sharpen their unique selling points, ensuring their brand messaging aligns with customer expectations.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How can a Product Manager use the three levels of product?<\/h2>\n\n\n\n<p>At its core, the three levels of Product is a marketing concept, but it\u2019s also a powerful tool for customer research and <a href=\"https:\/\/www.prodpad.com\/blog\/product-analysis\/\"><strong>product analysis<\/strong><\/a>. As Product Managers, we need to deeply understand our users &#8211; their pain points, motivations, and unmet needs. This framework helps break down a product\u2019s value from multiple angles, making it easier to analyze how well it aligns with user expectations.<\/p>\n\n\n\n<p>By mapping your product across core, actual, and augmented levels, you can:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Identify customer needs more effectively:<\/strong> Understanding the core benefit helps ensure your product truly addresses a real problem.<\/li>\n\n\n\n<li><strong>Develop a clearer value proposition:<\/strong> By articulating what makes your product essential (core), functional (actual), and competitive (augmented), you refine your messaging.<\/li>\n\n\n\n<li><strong>Prioritize features with impact:<\/strong> Features that directly support the core benefit should take precedence in your roadmap.<\/li>\n\n\n\n<li><strong>Improve <\/strong><a href=\"https:\/\/www.prodpad.com\/blog\/competitive-product-analysis\/\"><strong>competitive product analysis<\/strong><\/a><strong>:<\/strong> Evaluating your augmented product can reveal areas where you can differentiate through services, integrations, or premium offerings.<\/li>\n\n\n\n<li><strong>Guide continuous improvement:<\/strong> Regularly assessing the augmented level ensures your product evolves with customer expectations and market trends.<\/li>\n\n\n\n<li><strong>Create more engaging release notes:<\/strong> By highlighting improvements at each level, you can better communicate <a href=\"https:\/\/www.prodpad.com\/blog\/release-notes\/\">release note<\/a> updates in a way that resonates with different user needs.<\/li>\n<\/ul>\n\n\n\n<p>While this isn\u2019t a rigid <a href=\"https:\/\/www.prodpad.com\/blog\/product-management-frameworks\/\">Product Management framework<\/a>, it\u2019s a useful lens to assess product-market fit, customer alignment, and strategic growth opportunities.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Three levels of product example<\/h2>\n\n\n\n<p>Still not really getting it? That\u2019s okay, the concept of the 3 level product is a bit abstract. Because everyone seems obsessed with Duolingo and that green bird, let\u2019s break down the three levels of product using it as an example \ud83e\udd89.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Level 1\ufe0f\u20e3 Core Product \u2013 The fundamental need<\/h3>\n\n\n\n<p>At its core, Duolingo isn\u2019t just an app, it\u2019s a tool to help people learn a new language. The real benefit? Language acquisition and communication skills.&nbsp;<\/p>\n\n\n\n<p>Users don\u2019t sign up just to tap on a screen, they want to speak Spanish on vacation, ace their French class, or stop embarrassing themselves in Italian restaurants. That\u2019s the core product &#8211; the deep, underlying value Duolingo provides.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Level 2\ufe0f\u20e3 Actual Product \u2013 The tangible experience<\/h3>\n\n\n\n<p>This is what you see, use, and interact with:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Duolingo app itself<\/li>\n\n\n\n<li>Features like bite-sized lessons, gamified streaks, and XP points<\/li>\n\n\n\n<li>A friendly (and slightly menacing) green owl mascot who guilt-trips you into practicing<\/li>\n\n\n\n<li><a href=\"https:\/\/www.prodpad.com\/blog\/freemium-vs-free-trial\/\">Freemium<\/a> subscription tiers<\/li>\n\n\n\n<li>Speech recognition technology for pronunciation practice<\/li>\n\n\n\n<li>A brand identity built around fun, accessibility, and consistency<\/li>\n<\/ul>\n\n\n\n<p>All these elements make up the actual finished product, shaping the experience users have with Duolingo.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Level 3\ufe0f\u20e3 Augmented Product \u2013 The extras that add value<\/h3>\n\n\n\n<p>This is where Duolingo goes beyond just being an app and differentiates itself from competitors.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Duolingo Plus (now called Super Duolingo)<\/strong>: Removes ads, offers offline access, and lets you repair streaks.<\/li>\n\n\n\n<li><strong>Duolingo for Schools<\/strong>: A free tool for teachers to track student progress.<\/li>\n\n\n\n<li><strong>Duolingo Events<\/strong>: Virtual meetups for practicing languages in real conversations.<\/li>\n\n\n\n<li><strong>AI-driven personalized learning<\/strong>: Adapts lessons based on user progress.<\/li>\n\n\n\n<li><strong>Brand trust and community<\/strong>: Millions of learners, social media engagement, and meme-worthy presence.<\/li>\n<\/ul>\n\n\n\n<p>The augmented product is what makes Duolingo more than just a language-learning app &#8211; it\u2019s a sticky, engaging, and evolving ecosystem that keeps users coming back.<\/p>\n\n\n\n<p>So, next time you open the app and that green owl stares into your soul, remember: Duolingo isn\u2019t just a bird with an agenda. It\u2019s a three-level product strategy in action.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">The different layers of your product<\/h2>\n\n\n\n<p>Understanding the three levels of product offers you a powerful framework for <a href=\"https:\/\/www.prodpad.com\/glossary\/product-discovery\/\">product discovery<\/a>, customer research, and competitive product analysis. By breaking your product down into the core, actual, and augmented layers, you can better align your offerings with customer needs, sharpen your value proposition, and create a stronger connection with your potential customer.<\/p>\n\n\n\n<p>While the concept itself is simple, the impact it can have on your <a href=\"https:\/\/www.prodpad.com\/glossary\/product-strategy\/\">product strategy<\/a> is huge. It can help you prioritize features, identify gaps in the market, and even craft better marketing campaigns by focusing on the different ways your product provides value at each level.<\/p>\n\n\n\n<p>We think following the three levels of Product can help you prioritize features by assessing them based on their value. But there are plenty of other ways to prioritize your ideas. Check out our eBook on Product Prioritization Frameworks to learn all about the best frameworks to help you make informed product decisions.<\/p>\n<\/div>\n\n\n\n<div class=\"col\"><\/div>\n<\/div>\n\n\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large is-resized\"><a href=\"https:\/\/www.prodpad.com\/downloads\/prioritization-guide\/\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"240\" src=\"https:\/\/www.prodpad.com\/wp-content\/uploads\/2023\/07\/ProdPad-Prioritization-Framework-eBook-1024x240.png\" alt=\"The definitive collection of prioritization frameworks from ProdPad product management software\" class=\"wp-image-80814\" style=\"width:600px\" srcset=\"https:\/\/www.prodpad.com\/wp-content\/uploads\/2023\/07\/ProdPad-Prioritization-Framework-eBook-1024x240.png 1024w, https:\/\/www.prodpad.com\/wp-content\/uploads\/2023\/07\/ProdPad-Prioritization-Framework-eBook-300x70.png 300w, https:\/\/www.prodpad.com\/wp-content\/uploads\/2023\/07\/ProdPad-Prioritization-Framework-eBook-768x180.png 768w, https:\/\/www.prodpad.com\/wp-content\/uploads\/2023\/07\/ProdPad-Prioritization-Framework-eBook.png 1280w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/a><\/figure>\n<\/div><\/div><\/section>\n\n\n\n<section class=\"related-terms-section pp-blocks-section page-section content-dark has-text-align-center\">\n    <div class=\"container\">\n        <div class=\"row\">\n            <div class=\"col\"><\/div>\n            <div class=\"col-6\">\n                                <div class=\"header\">\n                    <h2 class=\"has-text-align-center\">Related terms<\/h2>\n                <\/div>\n                <div class=\"related-terms\">\n                                        <div class=\"related-term\">\n                        <h3><a href=\"https:\/\/www.prodpad.com\/glossary\/product-marketing-manager\/\">Product Marketing Manager<\/a>\n                        <\/h3>\n                        <p>A Product Marketing Manager is the person who\u2019s sharing your product with the world. They\u2019re the driving force behind getting your product in front of your target audience.<\/p>\n                    <\/div>\n                                        <div class=\"related-term\">\n                        <h3><a href=\"https:\/\/www.prodpad.com\/glossary\/product-management-lifecycle\/\">Product Management Lifecycle<\/a>\n                        <\/h3>\n                        <p>The Product Management lifecycle is a framework that details the different phases of work involved in managing a product through each stage of its development<\/p>\n                    <\/div>\n                                    <\/div>\n                <a class=\"btn btn--small btn--text go-back\" href=\"\/glossary\/\">\n                    <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"16px\" height=\"16px\" fill=\"none\" viewBox=\"0 0 16 16\">\n                        <path fill=\"#1B7FA6\" fill-rule=\"evenodd\"\n                            d=\"M6.199.95a.75.75 0 1 1 1.057 1.065L2.82 6.42H15a.75.75 0 0 1 0 1.5H2.82l4.436 4.405a.75.75 0 0 1-1.057 1.065L.479 7.709a.748.748 0 0 1 0-1.078l5.72-5.68Z\"\n                            clip-rule=\"evenodd\" \/>\n                    <\/svg>\n                    <span>Back to glossary<\/span>\n                <\/a>\n            <\/div>\n            <div class=\"col\"><\/div>\n        <\/div>\n    <\/div>\n    <\/section>\n\n\n<p><\/p>\n","protected":false},"author":46,"menu_order":0,"template":"","format":"standard","meta":{"_acf_changed":true,"pp_exclude_from_search":false},"class_list":["post-83776","pp_glossary","type-pp_glossary","status-publish","format-standard","hentry","glossary-categories-t"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.4 (Yoast SEO v27.4) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>What are the Three Levels of Product | Definition &amp; Overview | ProdPad<\/title>\n<meta name=\"description\" content=\"The three levels of product break down your product into different layers. 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