economic goods, services & utility marketing principles chapter 1
TRANSCRIPT
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Economic Goods, Services & Utility
Marketing Principles
Chapter 1
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General Purposes of Marketing
• People have economic needs & wants
• Producers create goods & services to satisfy consumer’s needs & wants
• Marketing adds usefulness to goods & services by bringing sellers(producers) & buyers(consumers) together so exchange can occur.
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Economic Goods & Services
• Things produced that satisfy consumer’s needs & wants
• Goods: Tangible (can touch)
• Services: Intangible (can not touch)
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Before Exchange Can Occur Goods & Services Need Utility
Utility(usefulness): The attributes of a product or service that make it capable of satisfying consumers’
wants & needs.
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Utility is added through Marketing & the 7 Marketing Functions
• Distribution
• Financing
• Marketing-Information-Management
• Pricing
• Product/Service Management
• Promotion
• Selling
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Goods & Services Must Have Utility(usefulness) – 5 Ways Utility is
Added to Goods & Services
• Form• Place• Time• Possession• Information
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Economic UtilitiesEconomic Utilities
Changing raw materials or putting parts together to make them useful to consumers.
1. Form Utility
Example: A tree is not useful to consumers until it is cut down and produced into a good like a chair or desk. Putting raw materials together so it satisfies consumers’ needs adds form utility.
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Economic UtilitiesEconomic Utilities
Adding usefulness by having a product where customers can buy it.
Example: Selling winter coats in Alaska. Winter coats would not have utility in Florida.
Example: Selling products at stores that are located in cities where populations are large.
2. Place Utility
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Economic UtilitiesEconomic Utilities
Adding usefulness by having a product available when it is convenient & needed by customers.
Example: Retailers offer large supplies of backpacks in the late summer, near the beginning of the school year. Example: Selling candy @ Valentines
3. Time Utility
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Economic UtilitiesEconomic Utilities
Adding usefulness by helping consumers take ownership of products.
Example: Taking credit cards and checks rather than just cash enables customers to buy products.
Offering 0% free financing.
Offering free delivery with purchase of a product.
4. Possession Utility
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Economic UtilitiesEconomic Utilities
Adding usefulness to goods & services by providing information so the customer is comfortable buying.
5. Information Utility
Example: Salespeople explain features of products.
Example: Packaging explains qualities and uses.
Example: Advertising informs consumers about products.
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Goods & Services Must have Utility
All types of utility are added throughout the marketing process so products have value to consumers.