Objectives: Warm Up: 1. Explain the concept of utility. Complete the 1. Warm Up 2. Product design handout 2. Cite examples of types of utilities. Agenda: level activity 3. Brand activity 4. Utilities P.P. 5. Adding value activity 6. Assist. Marketing Manager activity Marketing supports competition and offers benefits to consumers The meaning of economic utility The five economic utilities and how to distinguish the four that are related to marketing 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. The attributes of a product or service that make it capable of satisfying consumers’ wants and needs The Benefits of Marketing and the Five Utilities The Benefits of Marketing and the Five Utilities Economic Benefits of Marketing Economic Benefits of Marketing Possession Time Form Information Place Economic Benefits of Marketing Form Utility Changing raw materials into usable goods or putting parts together to make them more useful Place Utility Having a product where customers can buy it Time Utility Having a product or service available at a certain time of year or a convenient time of day Possession Utility The exchange of a product for money Information Utility Communication with consumer 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. Fixed cost for manufacturing widgets are $25,000. Determine the fixed cost per unit when the quantity produced is: a) b) 5,000 75,000 a) $5.00 a) $.33 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. 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? The functions of marketing add value to a product by making it more useful. This added value is also called… Explain the role that marketing plays in an economy. How does increased demand for a product help lower its price to consumers?