The process of both production and marketing add utility to goods and services. In marketing, utility is the usefulness of a product to consumers. To serve customers, businesses and five basic kinds of utility of products. The production processes ad form utility. Marketing processes add four other utilities to products: time utility, place utility, possession utility, and information utility.
Form utility is the increased usefulness of a product to a consumer by causing a change in the basic material through production. For example, glass, chrome and steel combined to form an automobile are more useful to consumers than they are as raw materials.
Time utility is the increased usefulness that a marketer gives a product by making it available to the customer at the right time of year and most convenient time of day. Marketers buy and store products so they will be available when customers need them. Months before Christmas season begins, marketers prepare to offer customers the merchandise they expect to see. Marketers plan for other holidays and events that take place during the year. Marketing provides goods not only at the time of the year customers want them but at the time of the day that is most convenient for them to shop.
Place utility is the increased usefulness of products because of location. Marketers add place utility to products by offering convenient selling locations and by shipping products to these locations. For example, place utility is added by locating in the shopping centers that are easily accessible to customers. A wonderful example of this would be your local shopping mall or Walmart. Another example would be the grocery store; being able to purchase produce from all over the world.
Possession utility in the ability of marketers to aid customers in owning goods. Marketers may add possession utility by offering credit or accepting checks. This enables the customer to purchase the product with out having to spend hard currency. Marketers may also add possession utility by offering a payment plan or a partial trade. This works well when going to purchase a new car. Possession utility takes place when marketing activities help to provide the customer with possession and legal ownership.
Information utility is the usefulness added to a product through communication. A great example would be advertising ( any sales message paid for by a sponsor and appearing in media) may inform customers of the benefits, availability, and prices of a product. A billboard promoting QT coffee, informs a traveler of a nearby service station. Packaging and labeling which i will go into ore in depth at a later juncture, may simplify shopping by identifying the qualities and best uses of products. Labels and warning on cold medicine contribute to relief and safety. The directions that come with a microwave oven tell the user how long to heat certain foods. By communicating with the public, marketers make products more useful.
In addition to time, place, possession, and information utility, marketing provides other customer benefits. People enjoy more conveniences and luxuries because marketing has made them possible. By creating a demand for products, marketing encourages greater production. When goods are manufactured in large quantities, the costs of producing them drops. Price and then be lowered, and more people will buy the goods. The personal computer is a great example.
Originally very expensive, but marketing information convinced many consumers of the educational, entertainment, and personal uses of this product. The increased demand, prompted large scale production and encouraged competition from other producers. Prices then came down, and marketers informed the public again. Demand increased even further, as more people discovered how they could benefit from this new product. The lesson learned is by adding utility to products, marketers increase the well being of the entire marketplace.
Form utility is the increased usefulness of a product to a consumer by causing a change in the basic material through production. For example, glass, chrome and steel combined to form an automobile are more useful to consumers than they are as raw materials.
Time utility is the increased usefulness that a marketer gives a product by making it available to the customer at the right time of year and most convenient time of day. Marketers buy and store products so they will be available when customers need them. Months before Christmas season begins, marketers prepare to offer customers the merchandise they expect to see. Marketers plan for other holidays and events that take place during the year. Marketing provides goods not only at the time of the year customers want them but at the time of the day that is most convenient for them to shop.
Place utility is the increased usefulness of products because of location. Marketers add place utility to products by offering convenient selling locations and by shipping products to these locations. For example, place utility is added by locating in the shopping centers that are easily accessible to customers. A wonderful example of this would be your local shopping mall or Walmart. Another example would be the grocery store; being able to purchase produce from all over the world.
Possession utility in the ability of marketers to aid customers in owning goods. Marketers may add possession utility by offering credit or accepting checks. This enables the customer to purchase the product with out having to spend hard currency. Marketers may also add possession utility by offering a payment plan or a partial trade. This works well when going to purchase a new car. Possession utility takes place when marketing activities help to provide the customer with possession and legal ownership.
Information utility is the usefulness added to a product through communication. A great example would be advertising ( any sales message paid for by a sponsor and appearing in media) may inform customers of the benefits, availability, and prices of a product. A billboard promoting QT coffee, informs a traveler of a nearby service station. Packaging and labeling which i will go into ore in depth at a later juncture, may simplify shopping by identifying the qualities and best uses of products. Labels and warning on cold medicine contribute to relief and safety. The directions that come with a microwave oven tell the user how long to heat certain foods. By communicating with the public, marketers make products more useful.
In addition to time, place, possession, and information utility, marketing provides other customer benefits. People enjoy more conveniences and luxuries because marketing has made them possible. By creating a demand for products, marketing encourages greater production. When goods are manufactured in large quantities, the costs of producing them drops. Price and then be lowered, and more people will buy the goods. The personal computer is a great example.
Originally very expensive, but marketing information convinced many consumers of the educational, entertainment, and personal uses of this product. The increased demand, prompted large scale production and encouraged competition from other producers. Prices then came down, and marketers informed the public again. Demand increased even further, as more people discovered how they could benefit from this new product. The lesson learned is by adding utility to products, marketers increase the well being of the entire marketplace.
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