Substitute goods

Imagine you really like chocolate. You want to buy a chocolate bar, but at the store, you see they are all sold out! What do you do?
Well, you start looking at other kinds of candy. You see a bag of gummy bears and think, "Hmmm, these might be a good substitute for my chocolate fix!"
That's what substitute goods are - things you can buy instead of the thing you originally wanted. They are similar products that can be used to fulfill the same need or want.
So, if you can't buy the original product (in this case, the chocolate), you can buy a substitute good (in this case, the gummy bears) instead.