How is utility defined in marketing

Another sport-related case is Adidas Runbase, which transfers utility from a digital sense into real life. It is based on the idea that runners in Tokyo like to exercise before or after work but do not have a place to shower or leave their belongings. So, in order to fulfil this need, Adidas created a bespoke space near the subway for runners to shower and rent lockers.

Of course, the facility just so happens to include a space that sells branded apparel, but by offering an incredibly convenient service first and foremost, visitors are less likely to feel like it is a solely commercial enterprise. Another form of utility marketing comes in the form chatbots or AI within messaging. The reason this is the case is that chatbots allow consumers to connect and engage with brands at their own convenience — using them to fulfil a specific service in the very moment they require it.

Travel is one industry where chatbots offer huge potential , with many big brands using them to streamline customer service and provide direct communication with consumers. It also uses this channel to update travellers about possible delays and lets users directly ask questions, such as how much baggage allowance they have or if they can change seats.

This kind of utility is invaluable to consumers, as it solves problems in the moment and even prevents them ahead of time. Chatbots and apps aside, there have been many other examples of brands using utility as a marketing tool.

Here are just a few more that have caught my eye. A firm goes through the process of both creating and distributing a product to create utility value for the end consumer. There are five types of different utilities that can be generated for a consumer by a firm.

This means that the firm adds value by designing a product in a particular way. Task utility is usually associated with a service firm, where the organization provides value through performing a task delivering a service for a consumer. Information utility is a new addition to this list, but in a world where competition for even basic goods now happens on a global scale, information can make the difference between successful sales and failed conversion efforts.

Information utility speaks to any data that helps consumers make buying decisions. This includes product details on ecommerce pages, targeted marketing campaigns, and well-trained call center and in-store agents capable of answering customer questions.

Simply, the right information at the right time improves market utility and increases the chance of sales conversion. The ultimate goal of any marketing strategy is to create customer value.

While not every campaign requires the complete implementation of all five utility types to improve conversion and customer satisfaction, general knowledge paves the way for implementation to deliver value at scale. Originally published Dec 30, AM, updated December 30 Logo - Full Color. Contact Sales. Overview of all products. Marketing Hub Marketing automation software. Service Hub Customer service software. CMS Hub Content management system software.

Operations Hub Operations software. App Marketplace Connect your favorite apps to HubSpot. Why HubSpot? Marketing Sales Service Website. Subscribe to Our Blog Stay up to date with the latest marketing, sales, and service tips and news.

Here we also get into the utility for resellers. Services as Products And although some utilities actually deliver physical goods — like water utilities which actually deliver water — utilities are usually treated as services. Perishability An empty seat on a plane never can be utilized and charged after departure.

An empty seat on a plane never can be utilized and charged after departure. Other Inputs to Pricing Decisions The utility of a product depends on its value to the customer minus its price.