Utility : Attribute of consumption activity

Utility :  Attribute of consumption activity

Utility plays a pivotal role to understand the consumption behavior of the diverse and heterogeneous consumers for any particular product. Understanding and utilizing the use of a commodity can be expressed by the level of satisfaction attained by a consumer at as given point of time can be expressed or explained by utility.

There are various 2 basic types or methods that are used to measure utility :

•  Ordinal utility
•  Cardinal utility

Ordinal utility: Measured in terms of rankings the level of satisfaction. For example : We watch 5 movies in a day, we rank them according to the level of entertainment.

Cardinal utility : A traditional method used to assign numbers through scales and ratings. For example : We watch 5 movies in a day, we rank them in scale or ratings according to the story, acting, performance and direction etc.