ECONOMIC BENEFITS OF MARKETING

1. New and Improved Products Marketing generates competition Businesses look for ways to satisfy customers’ wants and needs to keep them interested Example: Cell phones have become “Smart Phones”

2. Lower Prices Marketing increases demand which helps to lower prices When demand is high, manufacturers can produce products in larger quantities $300,00 in Fixed Costs (rent, utilities, etc.) $300,000 ÷ 1,500 units = $200 / Unit $300,000 ÷ 15,000 units = $20 / Unit

3. Economic Utility The FUNCTIONS of marketing that ADD VALUE in economic terms Added Value is referred to as UTILITY Form Place Time Possession Information

FORM Changing raw materials into usable goods or putting parts together to make them more useful Taking things of little value by themselves and putting them together to create MORE VALUE Cars…. Transform into media centers with navigation/sound systems Phones…communication device turned SUPER COMPUTER

PLACE Having a product in a convenient place where customers can buy it Businesses study consumer shopping habits to determine the most convenient and efficient locations to sell products Catalogs The internet Retailers At home parties (Scentsy, Jewelry, MaryKay, Pampered Chef, etc.)

TIME Having a product or service available at a certain time of year or a convenient time of day TIME Utility helps to increase the value of the product Extended shopping hours for the holidays 24/7 Gas Stations, Walgreens, Etc.

POSSESSION The exchange of a product for Money Possession Utility increases as purchase options increase Alternatives to cash Layaway Plans Gradual Payments PayPal

INFORMATION Communication with the consumer Salespeople provide info by explaining features & benefits Displays Packaging & Labeling Advertising informs How to use the Product/Owners Manuals