The Importance of Marketing Chapter 1, Section 1.2
Key Term Utility
Think Critically… Take 2-3 minutes to brainstorm why prices drop when products become more popular… We will discuss shortly!
Why Marketing is Important… Micro-level: It can ________affect your life Macro-level: It provides the means for __________________to take place in the marketplace, thus helping the economy as a whole
Economic Benefits of Marketing New and _______________Products: In a competitive marketplace, businesses try to create _________or _______________products at ________________prices than their competition. Example: Pepsi vs. Coke Diet Pepsi Max has about one-third more caffeine than Diet Mountain Dew Diet Coke Plus is supposed to be “good” for you, supplementing the drink w/ vitamins
Economic Benefits of Marketing, cont. Lower Prices: Marketing activities ____________demand and this helps to lower prices When demand is___________, manufacturers can produce products in _________quantities Unit costs are___________
Economic Benefits of Marketing, cont. Added _____________and Utility: _______________________forces companies to be efficient and responsive to consumers Competition also forces companies to TRY TO ________________________ to a consumer’s shopping experience Example: U.S. Bank offers online banking, a 24- hour customer service hotline, and free check cards
Economic Benefits of Marketing, cont. Utility Definition: Added ____________in economic terms Utilities are the _____________of a product or service that make it capable of satisfying a consumers’ wants and needs Five economic ____________involved with all products Form Place Time Possession Information
Form Utility Changing raw materials or putting parts together to make them more__________. (i.e., making or producing things) Example: _________ spool of thread three yards of cloth --------------------------- Some Value Example: creating a jacket from these materials -------------------------- MORE Value!
Place Utility Involves having a product _________customers can buy it. Businesses study consumer shopping ______________to determine the most _____________and efficient _____________________to buy products. Examples: ________ Retail Stores (Brick & Mortar) Internet (Click & Order) Case Study Example: Blockbuster They have retail stores and now Blockbuster online!!
Time Utility Having a product available at a certain __________of year or a _________time of day Examples: Gold’s Gym staying open 24 hours Starbucks offering the pumpkin spice latte from September thru February
Possession Utility The __________of a product for money There are many variations today: Cash Personal checks _______________ Layaway and Installment Plans (delayed possession for gradual payment) Each option adds__________, as it gives the customer greater flexibility (i.e., greater opportunity to BUY)
Information Utility Involves _________with the consumer Examples: Salespeople provide ________ by offering features and benefits of products Advertising communicates ________about specials, how much a product___________, and sometimes where to buy it _________and labeling inform consumers about qualities and uses of a product Websites provide detailed information about their companies and their products
Review Questions… Which utility is added by drive-through windows at Starbucks? How does marketing help to lower prices?