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Chapter

CMNS 230 Chapter Notes -Mind, Product Lifecycle, Marginal Cost


Department
Communication
Course Code
CMNS 230
Professor
David Newman

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WEEK 3
Curious Economics
Grant
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How do markets determine what we watch, read and listen to?
How do cultural products behave in the market place?
How are they distributed and sold?
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Ordinary commodities are essentially utilitarian, cultural products contribute
to intellectual discourse
Like ordinary commodities, cultural products respond to forces of supply,
demand and competition
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TABLE 3.1: Why Cultural Products Are Not Like Ordinary Commodities
Attribute Ordinary Commodity
Nature of
Product
utilitarian purpose
Nature of
Production
Process
assembly line (each unit requires
significant resources)
Marginal Cost of
Unit of Product
significant
Predictability of
Demand
largely predictable
Substitutability large degree of substitutability
with competing brands
Time Line of
Demand
Demand for product continues
indefinitely until next product cycle
(measured in years)
Who Determines
Demand
ultimate consumer
Setting the Price Non-discriminatory; arbitrage
precludes market differentiation
Pricing Latitude dependent on competitive forces
of demand and supply;
constrained by significant
marginal cost and non-
discriminatory pricing
Nature of
Consumption
each unit of product is consumed
and not available to others
Time Line of
Advertising
continued advertising over years
to reinforce brand
.
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NATURE OF PRODUCT
Basic nature of cultural product is to communicate ideas and emotions,
ordinary products serve a utilitarian purpose
Value of cultural product is in its symbolic or representational content, not its
physical form or utilitarian attributes
Experienced good, rather than consumed/employed good
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