Marketing Dynamics – Unit 3 Lesson 1
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Economic Resources
O Goals
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Students will describe the concept of economic resources
Students will identify economic needs and wants
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Students will explain the concept of utility and cite examples of types of utility.
Students will describe the function of price in markets.
Students clarify how the interaction of supply and demand affects price.
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Economic Resources
O Terms to know
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Scarcity
Economics
Supply
Demand
Market Price
Factors of Production
Marketing Utilities
Goods
Services
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Economic Resources
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Goods – tangible products that you can touch or hold in your hand.
Services – intangible products, tasks performed for a customer.
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Economic Resources
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Scarcity
O Limited resources available to satisfy unlimited needs and wants.
Economics
O Study of how people choose to use the limited resources to satisfy the unlimited needs and wants.
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Economic Resources
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Supply – the relationship between the amount of a good or service that businesses are willing and able to make available and the price.
Demand – the relationship between the amount of a good or service that consumers are willing and able to purchase at the price.
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Economic Resources
O Market Price – the point at which supply and demand cross.
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Economic Resources
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Competition is the struggle between companies for customers.
Some companies choose to compete focusing on sale prices, this is called price competition.
Non-price competition business focus on factors other than price to attract customers such as quality, services, location, financing or reputation.
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Economic Resources
O Factors of Production
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Natural resources - land
Human resources - labor
O Capital resources - money
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Marketing Utilities
O Marketing adds value to products.
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Form utility
Place utility
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Time utility
Possession utility
O Information utility
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Marketing Utilities
O Form Utility
O Involves changing raw materials or putting parts together to make them more useful.
O Examples are
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O trees made into lumber, then lumber turned into houses.
Parts that are put together to make a smartphone.
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Marketing Utilities
O Place Utility
O Involves having a product where customers can buy it.
O Examples are chips and candy bars in a vending machine, or sleeping bags in a sporting goods store.
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Marketing Utilities
O Time Utility
O Have a product available at a certain of year or a convenient time of day.
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Marketing Utilities
O Possession Utility
O The exchange of the product for some monetary value.
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Cash
Personal checks
Credit cards
Financing layaway
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Marketing Utilities
O Information Utility
O Involves communication with the consumer.
O Salespeople
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Product labeling
Advertising
Displays
Product packaging
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Marketing Utilities
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Marketing adds value to products and increases demand.
Higher demand = increased production.
Increased production = lower cost per unit.
Lower cost per unit = lower prices
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Marketing Utilities
O New and improved products are a product of increased competition generated by marketing.
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