1. The importance of Marketing
Lesson 1.2

2. The Importance of Marketing
Objectives
Learn Three benefits of marketing
Apply the concept of Utility
List and Understand 5 types of Utility
Marketing Essentials Chapter 1, Section 1.2

3. Economic Benefits of Marketing
Marketing is important to the economy because it provides a means for competition to take place
Based on this concept, what are some benefits that result from competition?
Student Contributions:
Marketing Essentials Chapter 1, Section 1.2

4. Economic Benefits of Marketing
Three Marketing benefits to the economy and consumers are:
New and improved products
Lower prices
Added value

5. 1. New and Improved Products
To satisfy customer wants and needs at a profit
Marketing generates competition
Competition leads to new and improved products
What are some example of recent Products to the Market that are new or improved?
Answers: Iphone 5, XBOX One , PS4, Kindle HD
DVD
Ipad 3
Ipod 3, 4, generations
Computers with larger hard drivess
Digital cameras with more megapixales.

6. New and Improved Products
What is this ad showing as new/improved?
New and innovative paint container
Dutch Boy Paints won an award for its new container design that makes the container easy to hold and open as paint is poured.
Marketing Essentials Chapter 1, Section 1.2

7. 2. Lower Prices
Marketing increases demand (desire to purchase). When demand is high what happens?
Produce and Sell more units
Charge a Lower Price per Unit
More units produced reduces the unit cost per item
Fixed costs remain the same = unit cost of each item is lower Fixed costs (i.e. rent, insurance etc).
Marketers Make more money
/ 300 = $ must sell for more to make a profit.
7500 /1000 = $7.50

8. 2. Lower Prices Examples: What is the cost per unit?
Fixed costs =$7,500, produce 300 scarves
Fixed costs =$7,500, produce 1000 scarves
$7500/300 = $25.00
7500/1000 = $7.50
/ 300 = $ must sell for more to make a profit.
7500 /1000 = $7.50

9. In addition, when demand for products increase:
Lower Prices
In addition, when demand for products increase:
More companies enter the marketplace
Companies must lower prices to remain competitive
Marketing Essentials Chapter 1, Section 1.2

10. 3. Added Value and Utility
Marketing adds value to products - features that make people desire the product, leading to demand.
The value that marketing adds to a product or service is called utility.
Utility: An attribute of a product or service that makes it capable of satisfying consumers’ wants and needs
What attribute of a product determines if you buy it?

11. New and Improved Product Project

12. Recap What are the three types of products an organization can market?
What are three things you must follow as a marketer?
The marketing concept – is the purpose of marketing, what is the hidden word?
idea that a business should provide value different than competitors to satisfying the needs and wants of customers at a profit

13. Which of the 7 steps of marketing is being utilized by a business?
You receive a survey asking your opinion on the level of customer service you received
You receive an that tells you about JCPenny’s one day penny sell this weekend?
A business decides to offer three methods for customers to receive their purchases, one day, two day, and standard 7 day shipping options
After analyzing survey data, a business decides to create a ad campaign directed at millennials to increase sales

14. What are the Three Benefits of Marketing?

15. Added Value and Utility
Five utilities of a product /service contribute to satisfying customers’ wants and needs. What attribute of a product determines if you buy it?
Form
Place
Time
Possession
Information

16. 1. Form Utility: Changing raw materials or putting parts together to make them more useful
Take things with little value by themselves to make/have value when together
A zipper, yards of cloth, thread = jacket together
Special features added to increase value
Want the item because of new features/extras
What are some examples you can think of?
i.e. Smartphone to download apps, take photos, link to Facebook etc.
i.e. electronic controls on a steering wheel
Marketing Essentials Chapter 1, Section 1.2

17. 2. Place Utility: Offering a product where consumers can buy it
What are some places businesses may offer products to consumers?
Direct via catalogs
Retail stores
Web site
Seeing Vending Machines beginning to be a large venue for purchasing products

18. 3. Time Utility: Offering a product at a convenient time of day or year for consumers (hours of operation)
Think about time utility, what are some things marketers do to offer products to consumers when they want them?
Student Responses:

19. Time Utility Answer: Convenient shopping hours Extended holiday hours
Evenings hours
Supermarkets, hairstylists etc.
Malls open until 9:00 p.m.
Store hours until 6:00 p.m. to meet working market
Open Monday through Sunday
Open Monday through Friday – Until noon on Saturday
Extended holiday hours
Open 24 hours a day

20. 4. Possession Utility: the exchange of money for a product allowing consumers to take legal ownership of a product
What are some ways you take possession?
Student Answers:

21. Possession Utility
Ways to take Possession include:
Cash
Checks
debit cards
credit cards
installment/layaway plans
credit for business-to business
Credit via the internet

22. 5. Information Utility: communicating information about a product with the consumer
What are ways to communicate product information and benefits to a consumer?
Student responses:

23. Information Utility
Ways to communicate product info:
salesperson talks/demonstrations
store displays
through package labeling
Advertising – tv, radio, mail flyers etc.
owners’ manual
web sites
Social media

24. Economic Benefits of Marketing
New & Improved Products
Competition fosters ideas
Lower Prices
Increases Demand
Economic Utility
Five utilities Add value
What is the result of each of the three benefits?

25. Study Organizer: What are the Three Benefits of Marketing
List each Utility and an example of each
What are the Three Benefits of Marketing
Marketing Essentials Chapter 1, Section 1.2

26. Complete Real-World Application Worksheet Marketing Madness:
Lesson 1-1 Review
Complete Real-World Application Worksheet
Marketing Madness:
In a short paragraph, define each of the five utilities and give one real example of each that you have encountered as a consumer. Reflect on how you have personally benefited from marketing.