5 types of utilities

4/5 Types of Utility

updated 2015 Jan 19

Production and Marketing supply various kinds of utility that are needed to provide consumer satisfaction
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Definition of terms Within the world of "teaching marketing", and websites discussing the various "utilities of marketing", you'll find a variation on whether there are 4 or 5 Types, and sometimes different wordings of the type.
Fundamentally, the concept is used to explain that the process of marketing creates several "things" which make a product/service useable to the end user, without these "things" being done, it is not possible to acquire, and use the product properly.

Form - when someone makes something, they assemble a product from parts and you can use it

Task - when someone does something for you, like put ice cream in a cone, or change the oil in your car

(some marketing education profs and websites don't use the word Task, they discuss "Promotion" or they merge the meaning of "task" into "form")

Time - making sure the product is available when people need it
Place - making sure the product is accessible, bring it to the customer, or have it in convenient place
Possession - letting the customer have the product, usually after they pay, they can "possess" it and hold it, transport it etc.

so when we say Marketing provides these 5 types of utilities,
we mean the process of marketing does things which makes it possible for you to have the finished product, or have some service done, or have it done at a particular time, or in a particular place

Definition of terms

Utility

When we say utility, what we mean is for a product to be something we can use and get some usefulness out of - utility

FORM

When someone makes something, they assemble a product from parts and you can use it. Marketing people use research to make sure that the form and shape of the product fits the expectations of the customer.

For example, the form, when applied to a clothing item, can be the shape of the garment and the range of sizes and the selection of fabric. So the "utility" of the marketer, is that they assemble various fabrics together into a garment that you can wear, instead of you gathering all the component parts yourself and making it yourself.

When applied to a service like software, it can be versions for different applications, or operating systems, like Windows and Mac.

TASK

In the context of providing a service, when someone does something for you, like

cut your hair because you can't, or don't want to do that, or
does something for you that you don't have time to do, like cut your grass, or
performs a skill on you that you don't have competency in, like extract a tooth,

we refer to that as the "task" utility - usually these are services, and like services they are intangible and cannot be "stored" or replicated exactly.

In providing the utility of completing a task for someone, marketing people require more communication with the customer in order to make sure that expectations are met precisely since the way the task is carried out can vary so easily.

TIME

The "social-cultural environment" of customers in the current marketing climate is one in which people often are quite impatient to take possession of the product once they have made the final decision to buy.

It is important, in a competitive environment, to use every opportunity to streamline your supply chain and distribution channels to allow a customer to physically obtain the chosen product as quickly as possible.

In the case of food service items, you can't have the burger ready and have the customers wait many minutes for the fries, they just won't come to your drive-through next time.

This is one of the reasons why (say some fast food experts) that McDonald's fries are skinnier and smaller than, say, Harvey's, they are designed to cook faster so McDonald's can serve customers faster because the McDonald's focus is on the "Fast" in fastfood.

PLACE

The utility of place refers to having the product exist in a location that is easily accessible to the buyer at the moment in time when their payment transaction is concluded.

If you are selling products in a huge warehouse style store, like Home Depot of Costco, the utility of "place utility" can be as simple as having the product in boxes on pallets ready to pe picked up and the customer can simply walk directly to the cashier to make payment.

When so many products are sold online, or in a marketing situation which may be partly online, and partly in a store, it is more and more important to make sure the "place utility" is as competitive as possible because sometimes the final decision about whether to buy, or not buy, is made by the customer based on how they can physically get their hands on the product as soon as possible.

For example, it is no good having a detailed YouTube video of how your low priced air-conditioner works, if the customer has to drive many miles to find a store with one actually in stock.

POSSESSION

The utility of Place and Possession are very much inter-related and depend on each other.

When someone buys something from a vendor, essentially, it is a "transfer of ownership".

Part of being successful in the competitive world of "selling stuff" is to make it easy for the customer to pay, and take possession.

The marketing utility that allows the customer to physically access what they bought, it referred to as "possession".

Having a variety of easy payment methods, cash, debit, credit card, paypal, etc. is part of facilitating possession as is the physical location of the product and how it is delivered to the customer.

One of the competitive positions Leon's furniture stores utilize is the incentive that people can make very low payments to obtain large purchases, and walk out of the store with their selection immediately - allowing for "possession" in an easy way.

In B2B situation, leasing and credit purchase options, such as 2/10 net 30 are also part of "possession".

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