Product Class: How To Categorize Products (2024)

As an entrepreneur and business owner, you must juggle two seemingly opposite perspectives: the big picture and the granular details. For example, say you run a homeware store; you might aim to help people transform their houses into warm, inviting spaces filled with beauty and comfort. But to achieve this vision, you have to focus on specific elements.

This is where product classes come into play. By grouping your products into classes like dinner party dishware or sectional sofas, you can improve your customers’ shopping experience and enable more targeted marketing efforts. 

Learn more about product classes, how they differ from product categories, and how understanding them can help you position your business for success. 

What is a product class?

A product class is a specific grouping of products within a broader category that have similar product attributes, features, and intended uses. Products in the same class serve as somewhat substitutable alternatives for each other and cater to specific customer needs or preferences.

Product class vs. product category: What’s the difference?

Product classes are more specific subsets within broader product categories. While a product category encompasses a wide range of items fulfilling a common need, a product class includes products with similar characteristics and functions, making them potential substitutes for one another, though not necessarily perfect replacements.

Here are a few examples of product classes:

• Running shoes (within the shoes product category)

• Convertible car seats (within the baby gear product category)

• Noise-canceling headphones (within the personal electronics product category)

In contrast, product categories are broad, top-level groupings of products with a similar larger purpose. Categories provide an overarching framework for organizing related products, offering a wider selection to consumers. They have a more comprehensive scope than the specificity of product classes, and products within a category may not always be substitutable. 

For instance, a sofa and a dining table both belong to the home furnishings product category, but they serve distinct purposes and you wouldn’t purchase one to replace the other. 

Here are a few examples of product categories:

• Home furnishings

• Gardening tools

• Beauty products

How to use product class

Here’s how understanding product class facilitates marketing your products:

Articulate the key differentiators of your product class

By identifying the specific class or classes to which your products belong, you can develop targeted marketing strategies, highlighting the unique features and benefits that set your offerings apart from the competition. To do this, you’ll need to look at your product categories and group the products in each into separate classes.

For example, wallet company Ridge breaks its product offerings down into a few classes: aluminum, leather, titanium, brass, carbon fiber, and more. This way, consumers can easily narrow down the options to suit their preferences.

Identify and understand your competitors

Understanding product class can help you identify your true competitors in the market. When you recognize your offerings are part of a broader class of products that serve similar needs, you can better understand which brands consumers compare when making purchase decisions. This knowledge allows you to:

• Tailor your positioning to highlight how your product stands out from the crowd

By identifying your direct competitors, you can develop targeted promotional strategies to reach your target audience effectively. For example, if you sell shower gels, you can focus on promoting the moisturizing properties or luxurious scents that set your product apart from other body cleansing products on the market.

Tailor the customer shopping experience 

By organizing your store or website based on product class, you create a more engaging and efficient shopping experience that helps customers find what they need, while also exposing them to related products they might enjoy.

A brick-and-mortar store that sells sporting goods might organize its inventory by product categories like team sports, fitness, and outdoor recreation. Within the team sports category, the store could display products by product classes, such as basketballs, soccer balls, and baseballs, making it easy for customers to find the specific type of equipment they need. 

The same principle applies to online sales. An ecommerce site specializing in beauty products could organize its offerings into product categories like skin care, makeup, and hair care. Within the skin care category, the site could group products by product classes, such as facial cleansers, body lotions, and sunscreens. This allows customers to quickly navigate to the specific type of product they want. 

The website could also recommend related products within the same product class—for example, suggesting a moisturizer to pair with a facial cleanser—making it easier for customers to find products that work well together and increasing the likelihood of additional sales.