Marketing Exchange Function.
Marketing Exchange Function refers to the process by which two or more parties give something of value to each other to satisfy each party’s perceived needs. There are two exchange functions:
- Buying function.
- Selling function.
Exchange is a key to marketing without an exchange, there is no need to market It involves two functions buying and selling which means sharing of any product which has some value between two parties, a buyer and a seller.
This involves an offer, agreement, formal transaction and ultimately an exchange of mutual value between the buyer and seller.
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This something of value can be a product, service, or idea of a person, such as an entertainer, athlete, or politician.
Marketing creates exchanges that satisfy consumer needs and meet the marketer’s objectives. Buying is acquiring the possession of a product in exchange of something.
Selling is transferring a product to the buyer in exchange of something. Buyer generates demand for the seller.
The criteria needed for an exchange to occur:
Exchange is of any thing that has some value to both the parties. It is required for the parties to be able to communicate with each other.
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Parties must have the willingness and desire to exchange something. There is a need of at least two people for an exchange to occur.
Every person has a freedom to accept or reject the offer without any obligation. The exchange process creates Utility. Utility is the satisfaction, or usefulness a user receives from a good ox a service.
There are four types of utilities:
Place utility is making the product available at the convenient locations for the customers. Example: Britannia breads and other fast moving consumer goods are available at almost every departmental store.
Time utility is making the product available when customers want to buy the product – Example: Few chemist shops are open overnight.
Possession utility is once you buy the product, you get the ownership. Example: You can eat apples once you buy them.
Form utility is production of the good, driven by the marketing function. Example: Amul turns milk into so many other milk products like butter, cheese, curd, etc.