Products are comprised of 5 levels. Each level adds more customer value. Here are the product levels using a hotel as an example.
Core benefit: service or benefit the customer is really buying.
Basic product: marketers turn core benefit into a basic product at this level.
Expected product: attributes and conditions buyers expect when they purchase this product. Competition takes place at this level in developing countries.
Augmented product: : attributes and conditions exceed customer expectations. Competition takes place at this level in developed countries..
Potential product: various augmentations that could be incorporated in the future. Here is where companies search for new ways to satisfy customers and distinguish their offering.