DAILY INFORMATION 4/24Objectives:

1. Explain the concept of utility.

2. Cite examples of types of utilities.

Warm Up:

Complete the handout

Agenda:

1. Warm Up2. Product design

level activity3. Brand activity4. Utilities P.P.5. Adding value

activity6. Assist.

Marketing Manager activity

ECONOMIC BENEFITS OF MARKETINGMarketing supports competition and

offers benefits to consumers

WHAT YOU WILL LEARN The meaning of economic utility The five economic utilities and how to

distinguish the four that are related to marketing

WHY ITS IMPORTANT See how the functions of

marketing add value to products.

See how marketing activities promote competition by leading to lower prices and new and improved products.

DEFINITION OF UTILITY The attributes of a product or

service that make it capable of satisfying consumers’ wants and needs

THE IMPORTANCE OF MARKETING

The Benefits of Marketing and the Five Utilities

THE IMPORTANCE OF MARKETING

The Benefits of Marketing and the Five Utilities

THE IMPORTANCE OF MARKETING

Economic Benefits of Marketing

THE IMPORTANCE OF MARKETING

Economic Benefits of Marketing

UTILITY ADDED VALUE

Form Place

Time

Possession

Information

FIVE ECONOMIC UTILITIES

Economic Benefits of Marketing

Form Utility

Place Utility

Time Utility

PossessionUtility

Information

Utility

Changing raw materials into usable goods or putting parts together to make them more usefulHaving a product where customers can buy itHaving a product or service available at a certain time of year or a convenient time of day

The exchange of a product for money

Communication with consumer

LOWER PRICES Marketing activities add value to

products and increase demand. When demand is high, manufacturers

can make products in larger quantities, which reduces the unit cost of each product. This is because the of fixed costs.

Example: the cost of rent on a building is the same whether the company produces 10 units or 10,000 units.

LOWER PRICE CALCULATIONFixed cost for manufacturing widgets are

$25,000. Determine the fixed cost per unit when the quantity produced is:

a) 5,000b) 75,000

LOWER PRICE ANSWERS

a) $5.00

b) $.33

NEW AND IMPROVED PRODUCTS

New and improved products are another result of increased competition generated by marketing.

As businesses continue to look for opportunities to better satisfy customers’ wants and needs, the result is a larger variety of goods and services.

NEW PRODUCTS Can anyone name a new product that is

currently being advertised? What is new and different about this

product? Where did you get your information? Did

it comes from personal knowledge of the product or an advertisement.

How did you hear about the product?

WRAP-UP QUESTION The functions of marketing add value to a product by making it more useful. This added value is also called…

WRAP-UP QUESTION Explain the role that marketing plays in an economy.

WRAP-UP QUESTION How does increased demand for a product help lower its price to consumers?