Know-How Exchange : Student Questions

Hi mac504,

With marketing you are trying to increase demand for goods and services. Getting consumers to find more utility and buy your product and service rather than a competitor, and this competitor can be either direct, indirect or a substitute.

Economics is all about supply and demand and utility: How goods and services are produced, distributed, and consumed. How people find higher or lower utility and make substitution decisions and spending behavior based off the utility they get, real or perceived.

I hope that helps.

They are directly related.

Economics (looking at the micro level, not macro level) is the study of why people buy products. The two main concepts are supply and demand (and its impact on prices), and price sensitivity (how much people buy based on a price).

One of marketing's 4-Ps is price, and one of the factors you take into account when setting price is the econoomics to your customer (and how much they will buy at a price).

Where they differ is that economics tries to work with hard numbers (science), where marketing often works in soft, touchy feely areas like brand and preceived value.

I would just add this:

Ebay is marketing and economics at their most basic.

Talking up your product (marketing) and selling it at the price that a buyer is willing to pay (micro economics). Supply and demand, one product and one customer at a time.

Ciao,
Ricky