What is Consumer Utility?
As a brand, we want to bring our consumers amazing products, and what's more amazing than custom branded gear! (We might be biased, but who cares!) We know that we're not the only ones with this desire, though. This goes for brands providing services and goods. The value that is brought to the customer is the utility of the product, the satisfaction that consumers get from purchasing your good or service, or the perceived value of the purchase. There are four types of utility – form, place, time, and ownership – and though not all four are necessary depending on the goods or services that your company offers, knowing which types best serve your target market best is pertinent to maximizing your value to consumers!
Form Utility is how much value the consumer receives from your goods or services. This is where knowing your market is very important. As a company, you need to be able to incorporate the consumers' needs into the product. The value isn’t always measurable; it can simply be perceived as value. Consumers sometimes just want to know that they’re getting everything they want, but it doesn’t mean that brands have to be constantly adding additional features. It can be as simple as better communication of present features.
For Place Utility, ease of access is key, knowing where your target market is located and meeting them there. This doesn't have to be a brick-and-mortar location if you’re a company that doesn’t need to operate out of a physical location. A company within the tech industry wouldn’t need a brick-and-mortar location, but having easy-to-use and helpful customer service is an example of place utility. You’re where your consumers need you to be! Another example of place utility is making your product available in a variety of locations. The ease of access allows you to easily generate sales. This, however, should be avoided by brands that market themselves as high-end or luxury. If your product is too easily available, it will bring down the consumer's perception of your "luxury".
Time utility is how quickly you can provide your customers with goods or services when they need them. Knowing your market allows you to serve your customers best and helps you maximize your efficiency. If you operate in an industry where your product or service isn't in demand on the weekends but is in high demand on the weekdays, don’t operate on the weekends. Poor Time Utility utilization will prevent you from reaching more of your target market and will result in revenue loss.
Ownership utility is how useful your product is and how quickly a consumer can use it after purchase. This is solely from the consumers' perspective, so it's important to keep in mind that not everyone who purchases your product or service will have used it before or is even familiar with the industry. So, if your product is on backorder due to shipping constraints, then it has too little ownership utility for consumers because they can’t use it soon after purchase. This is why things like Amazon Prime have been so successful in today's world; it allows for high ownership utility.
The purpose of understanding utility is not for us as companies to maximize our profits by hitting our consumers' weak points; it's so we can bring our consumers goods or services that enrich their lives in some way. By understanding utility, we can create better products and better services and be companies that truly are amazing!