Name the element of Marketing-mix in which a set of firms and individuals creates possession, place and time utility and helps in market offering Also explain any five important functions performed by this element from Business Studies Marketing Class 12 Haryana Board English Medium
This utility is created by transporting goods from one place to another. Thus, in marketing goods from the factory to the marketplace, place utility is created. Similarly, when food-grains are shifted from farms to the city market by the grain merchants, place utility is created. Transport services are basically involved in the creation of place utilities. In retail trade or distribution services too, place utility is created.
When a consumer acquires knowledge about a particular product, it is called knowledge utility. For example, the utility of a mobile phone or a computer increases when a person knows about its various functions. When the utility of commodity increases due to a change in its place, it is called place utilities. For example, woolen clothes have more utility at cold places than at warm places. In the normal situation, the marketer is a company serving a market of end users in the face of competitors .
Mother Nature has to offer Her blessings to satisfy the food needs of all living creatures. Land cultivation, otherwise known as farming is influenced by the behavior of natural events like rainfall, drought, flood, storm and so on and so forth. Food production has its limitations and so all food cannot be produced in all places. In other words, food production is restricted to specific locations where the soil, weather and moisture favor that activity. Nevertheless food produced has to be consumed worldwide by the human beings, animals, birds and others in need.
The agricultural marketing system is a link between the farm and the non-farm sectors. It includes the organization of agricultural raw materials supply to processing industries, the assessment of demand for farm inputs and raw materials, and the policy relating to the https://1investing.in/ marketing of farm products and inputs. Therefore, the framework under which agricultural produce markets function and the factors which influence the prices received by the farmers now need to be understood in a different perspective compared to that in the past.
- Service utility arises when personal services are rendered by various professionals.
- But, if Luxury Cars start dealing across the globe, the utility of the cars will increase for worldwide customers.
- The higher the after-sales services, the more consumers will derive possession utility from employing a particular product.
- The mass production of goods also evoked the sense of availability of goods at any time.
- Consequently, firms and organisations have a reason to improve the utility of their commodities.
A product’s utility entirely relies on its capability to satisfy a consumer’s need or demand. There are various distinct representations of measuring the economic utility and the usefulness of a commodity or a service. It was first presented by an eminent Swiss mathematician, Daniel Bernoulli in the 18th century. From that time, the progression of economic theories has led to numerous kinds of economic utility. It helps to make the exchange of goods between buyers and sellers easy. Anything that helps complete the sale- delivery, installation, warranties credit is considered part of possession utility.
What is Utility?
An efficient agricultural marketing system leads to the optimization of resource use and output management. An efficient marketing system can also contribute to an increase in the marketable surplus by scaling down the losses arising out of inefficient processing, storage and transportation. A well-designed system of marketing can effectively distribute the available stock of modern inputs, and thereby sustain a faster rate of growth in the agricultural sector. Rural markets generally have poor marketing facilities as compared to urban markets.
It involves various processes, like logistics, storage, and delivery. Organisations are continuously enhancing their supply chain management systems to provide 24×7 availability and same-day delivery of a product. The term agricultural marketing is composed of two words – agriculture and marketing. Agriculture, in the broadest sense, means activities aimed at the use of natural resources for human welfare, i.e., it includes all the primary activities of production. But, generally, it is used to mean growing and/or raising crops and livestock.
The marketing system is essential for the success of the development programmes which are designed to uplift the population as a whole. This utility defines the satisfaction and gains received from using and having a specific commodity. Generally, a useful product holds a more enhanced possession utility. Concerning marketing theories – possession utility has its mention within the simple possession also. That’s done through acquisition processes like credit cards or renting contracts. A simple acquisition makes a utility to be perceived highly by consumers.
What are the Accounting Functions?
A consumer is a person who usually decides his/her need for products and commodities according to the satisfaction he/she gets from it. The concept of utility in economics refers to the satisfaction a customer derives from a service or a product. Customers try their best to choose the commodities logically, to boost their utility.
Supply chain management involves manufacturing, research, sales, advertising, shipping and, most of all, cooperation and understanding of tradeoffs throughout the whole channel to achieve the optimal level of efficiency and service. Although wholesalers can be eliminated, the functions they perform cannot. Despite these efficiencies, the press, consumers, public officials, and other marketers freely criticize intermediaries, especially wholesalers.Critics accuse wholesalers of being inefficient and parasitic. But, by assembling all the parts and presenting a whole vehicle, it adds to the value derived by consumers and increases the form’s utility. The functions that represent utility of a product according to its preference, but does not provide any numerical figure refers to ordinal utility. Ordinal utility believes that the satisfaction level cannot be evaluated; however, it can be levelled.
Different people can experience different levels of utility from the same products. For example, a person who loves eating fast food will achieve a higher utility from a burger compared to a person who doesn’t like eating fast food. For instance, the utility of a room heater is subject to whether it is used in Kashmir or Cochin, and during summer or winter.
Time utility in economics can be obtained if a commodity or a service is readily available to customers when they need it. Moreover, time utility becomes high when a product or service is scarce. The supply chain management of a company has a substantial impact on time utility.
The concept of marketing came into the picture during the industrial revolution. The industrial revolution lasted between the 18th to 19th centuries, and during this time, a rapid social change took place. These changes were motivated by innovations in the scientific and technological industries.
If a company can provide a rental car at a consumer’s disposal based on individual customers’ urgency of need, it can enhance time utility for consumers. This type of utility is formed marketing what creates time place and possession utility by the product design or the service itself. The more accurately a commodity or service is produced based on customer desires and requirements, the higher will be its accepting value .
Agricultural marketing plays an important role not only in stimulating production and consumption, but in accelerating the pace of economic development. Its dynamic functions are of primary importance in promoting economic development. For this reason, it has been described as the most important multiplier of agricultural development. For instance, if a consumer notices that his AC is malfunctioning and cannot avail repairing services within an agreeable time, possession utility from that AC will fall. Conversely, if the concerned AC company promptly addresses the issue and fixes the AC within an agreeable period, possession utility will increase.
A group of people specializing in food production and identified as farmers shoulder the noble responsibility of feeding the entire world. Hence there is no need to emphasis that food produced at specific places has to be distributed to other places of consumption. A marketing channel is a group of individuals and organizations that directs the flow of products from producers to consumers. The major role of marketing channels is to make products available the right time at the right place in the right quantities. By providing quick access to services and goods for the purchasers, place utilities are often acquired. If products are often purchased without putting much effort, consumers get more interested in it.
On one hand surplus production in agriculture resulted in problem of distribution to consumption centres and on the other transformed agriculture into a commercial venture where market needs came to the lime lite. Farmers in the past used such farm sector inputs as local seeds and farmyard manure. These inputs were available with them; the purchase of inputs for production of crops from the market by the farmers was almost negligible. The importance of farm inputs – improved seeds, fertilizers, insecticides and pesticides, farm machinery, implements and credit – in the production of farm products has increased in recent decades.