Transcript Economic Utility
WHAT IS UTILITY?
Useful products make our lives better. They
provide us with something worthwhile. They
have utility – usefulness.
Utility is about satisfying wants and needs.
If customers are satisfied with what a product
offers because it fulfills a desire, the product has
If not the product lacks utility.
SELF-INTEREST FUELS UTILITY
Consumers and Businesses buy products that benefit them
– the products with the most utility.
The first products consumers buy are the ones that benefit
them most – the products with the most utility.
WHAT TO MAKE?
Businesses work to satisfy consumers demand for
products and services.
Marketing tries to:
Improve existing products and services
Develop better products and services
Change how products and services are delivered
These changes are called “Creating Utility”
FORM & TASK UTILITY
A Product’s Form is tangible – whatever can be noticed by
Marketers change the tangible parts of goods to Create
Form Utility is created when the physical characteristics
of a product are changed to make it more useful
Task Utility is created when the characteristics of a
service are changed to make it more useful.
Getting the timing right to make a product available to
Requires looking ahead and anticipating what will be
needed in the future.
Marketers make changes to avoid or correct problems
Time Utility is created when products are made
available at the time they are needed or wanted by
Place is the right location for products and services – on a
shelf, in the showroom, at the fair, in the warehouse, at the
Making changes to a product or service’s location can
create Place Utility
The usefulness created by making goods and services available at
the place they are needed or wanted by consumers.
Possession involves selling the product or transferring the
The exchange of money for a product or service shifts
Possession Utility is the usefulness created when ownership
of a product is transferred from the seller to the buyer or
when a service is performed by the provider for the buyer.
Marketers make changes that affect the purchasing process
by making it easier to buy a product or service.
HOW DOES MARKETING INFLUENCE
Marketing is about making a connection between a
product or service and the consumer
To do this they share information on product
benefits with consumers and encourage them to
Marketing tools: Displays
HOW DOES MARKETING INFLUENCE
Form Utility: Product changes are made in production –
Marketing recommends changes to the product form after
analyzing what consumers want.
Time Utility: Marketing works to understand when consumers
want a product and work to plan and schedule all of the steps in
the product development cycle.
Place Utility: Marketing determines the best location to place
the product where it will meet consumer’s needs.
Possession Utility: Marketing analyzes what barriers prevent
consumers from buying the product or service and design ways
to remove them.
In groups of 2, you will pick a product or service.
You will have 15 minutes for your team to come up with an example of
a Time, Place, Possession, and Form Utility change for your product or
service that will increase sales and customer satisfaction.
You will need to present your ideas to your classmates using a drawing,
demonstration, or model.
As each team presents the changes to the product or service, the other
student teams will guess which utility is used in each example.