Professional Documents
Culture Documents
Marketing Management
BBA
Tanvi Jain
Dept. of Commerce & Management
Biyani Girls College, Jaipur
2
Published by :
Think Tanks
Biyani Group of Colleges
Edition : 2012
While every effort is taken to avoid errors or omissions in this Publication, any mistake or
omission that may have crept in is not intentional. It may be taken note of that neither the
publisher nor the author will be responsible for any damage or loss of any kind arising to
anyone in any manner on account of such errors and omissions.
Marketing Management
Preface
am glad to present this book, especially designed to serve the needs of the
students. The book has been written keeping in mind the general weakness in
understanding the fundamental concepts of the topics. The book is self-explanatory and
adopts the Teach Yourself style. It is based on question-answer pattern. The language
of book is quite easy and understandable based on scientific approach.
Any further improvement in the contents of the book by making corrections,
omission and inclusion is keen to be achieved based on suggestions from the readers
for which the author shall be obliged.
I acknowledge special thanks to Mr. Rajeev Biyani, Chairman & Dr. Sanjay Biyani,
Director (Acad.) Biyani Group of Colleges, who are the backbones and main concept
provider and also have been constant source of motivation throughout this endeavour.
They played an active role in coordinating the various stages of this endeavour and
spearheaded the publishing work.
I look forward to receiving valuable suggestions from professors of various
educational institutions, other faculty members and students for improvement of the
quality of the book. The reader may feel free to send in their comments and suggestions
to the under mentioned address.
Tanvi Jain
Syllabus
Marketing Management
Unit-1
Introduction
Q.1
customers for varied products and services. Therefore, nature of marketing has
been termed as developmental.
Marketing is dynamic in nature
Marketing is a continous process thereby making it dynamic in nature. Three
factors play an important role in this regard. First, the Research and
Development (R & D) wing of the marketer and second, the changing consumer
behaviour and the last is science and technology.
Marketing is responsive in nature
The marketer should adjust its entire marketing operations according to the
changed consumer behaviour and changing technology.
Marketing is innovative and creative
Every successful marketer does enough work to find out new ways and means to
promote the sales of its products and services.
Scope of Marketing:
Scope of Marketing is very wide. In it, large numbers of diverse subject areas are
included which incorporates consumer behaviour, pricing, purchasing, sales
management, product management, marketing communication, Comparative
marketing, social marketing, the productivity of marketing systems, role of
marketing in economic development, packaging, channels of distribution,
marketing research, societal issues in marketing, retailing, wholesaling, the social
responsibility of marketing, international marketing, commodity marketing etc.
Q.2
Marketing Management
Marketing Management
Ans.: The various fundamental concepts are :(1) Barter System : It is a method of exchange by which goods or services are
directly exchanged for other goods or services without using a medium of
exchange, such as money. In ancient times when money was not invented
trade as a whole was on barter system. In term of marketing it holds the
concept that the exchange of a product or services between seller & buyer is
the central idea for marketing.
10
(2)
(3) Product Concept : This concept holds that consumers will prefer those
products that are high in quality, performance or innovative features.
Managers in these organization focus on making superior products &
improving them. Some of the important tactics for attracting customers
include the design, packaging and effective distribution channels of a
product. Sometimes, this concept leads to marketing myopia or other
problems when an organization overlooks the importance of other substitutes
available in the industry.
(4)
(5)
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(ii)
(iii)
(iv)
(6)
(7)
12
Senior
Other
Communication Products & Channels
Management Department
Services
Integrated
Marketing
Internal
Marketing
HOLISTIC
MKTG.
Social responsible
Marketing
Relationship
Marketing
Ethics Environment
Q.6
Legal
Community
Ans.:
S.No.
Selling
1.
2.
Marketing
Marketing
oriented.
of
is
customer
Marketing Management
3.
Emphasis is on product.
Emphasis is on customers
want.
4.
Views
businesses
as
a
customer satisfying process.
6.
9.
Marketing communicatiion is
looked upon as the tool for
communicating
the
benefits/satisfactions
provided by the product.
5.
Q.7
13
Ans.: Earlier business and marketing has very limited significance in the Indian
economy, but with the advent of LPG era in 1991 the scenario of business and
marketing changed. Now the market place isnt what is used to be earlier. It has
new behaviours, new opportunities & new challenges. These changes are due to
the following reasons:
(i)
14
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
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15
Case Study
Growing trends of E- mandis
Its time for consumers good old subziwallah to make way for the e- veggie vendors.
With the changing time, consumers needs and requirements are also changing. So to
stay in market and to hold your market space it has become essential for the
conventional vendors to update themselves as per the changing demands of time. One
example of this conversion from traditional vendors to techno vendors is
www.freshetarian.com.
www.freshetarian.in , a city based online portal, where you can order all the basic
grocery items, from toiletries to fresh fruits and vegetables. All thanks to the growing
demands of the corporate sector on Jaipurites, several e commerce ventures have
develped a loyal clientele in the city. These e mandis have proved to be very convenient
for corporate employees as it has proved itself to be a hassel free shopping.
These e sabzi or e grocery shopping saves time, fuel and everything is delivered at your
door step. And to make shopping more easier, they offer the options of both card
payment and COD. The other advantage of these online portals are that they help the
consumers in keeping the track of their monthly expenditures on grocery. Since these
portals let consumers to place their orders anytime, they tend to buy lesser amount of
grocery items at a time and that helps in avoiding wastage.
This new e commerce platform follows the warehouse system and caters to both
corporate and retail audiences. They also follow a minimum dilevery criteria for
example : Minimum 50 rs order is required for fruits and veggies and 200rs for other
grocery items.
So, next time when you make your list of routine grocey items, you dont have to march
to the supermarket with your list, just log on to these kinds of e sabzi mandis from the
comfort of your living room.
Questions :
Q.1 What are the problems faced by conventional/traditional vendors?
Q.2
How e vendors has proved themselves better to consumers in comparison to
traditional vendors?
Q.3 How can you relate the concept of selling to marketing in context of this case
study?
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18
Unit 2
Market Segmentation
Q.1
Ans: It is a fact that the need and requirements of each segment of the market vary in
terms of price, quality and other features of the product and services. Besides, no
marketer can produce a single product for all the customers in particular
category. Thus, the right thing to do is market segmentation. i.e making
marketing efforts in such a way that they are directed at a specific segment or
group of people.
The idea behind segmentation is to identify different types of buyers based on
their behaviours and identify them so that it would be easy for the firm in
marketing their products and services. The concept of segmentation and
targeting is based on the fact that markets are heterogeneous. No two buyers of
the product are identical in all respects. However, large groups of buyers have
some common characteristics which lead to identical buying and it is this group
which constitutes a market segment. Segmentation enables the marketers to give
better attention to the selection of customers and offer an appropriate marketing
mix for each chosen market, or a group of buyers having homogeneous demand.
In broader sense, market segmentation can be defined as the process of taking
the total heterogeneous market for the product and dividing it into sub markets
or segments, each of which tends to be homogeneous in all major aspects. It is a
method for achieving maximum market response by recognizing differences in
the response characteristics of various parts of the market. Thus we can say that
it is a consumer oriented philosophy.
Marketing Management
Q.2
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Define the term market segmentation? What is the benefit of segmenting the
markets?
OR
What do you mean by the term Market Segmentation? What is the need of
segmenting the market?
Ans.: The process of defining and subdividing a large heterogeneous market into
homogenous segments which have clearly identifiable characteristics having
similar needs, wants, or demand characteristics. Its objective is
to design a marketing mix that precisely matches
the expectations of customers in the targeted segment.
Four basic factors that affect market segmentation are
(1) clear identification of the segment,
(2) measurability of its effective size,
(3) its accessibility through promotional efforts, and
(4) its appropriateness to the policies and resources of the company.
The four basic market segmentation-strategies are based on
(a) Behavioral differences
(b) Demographic differences,
(c) Psychographic differences, and
(d) Geographical differences
(2)
20
(4)
(5)
(6)
Optimize the use of resources, with more efficiency and less waste,
particularly when marketing resources are limited.
(7)
Ans.: Market can be segmented using several relevant basis, they are :Geographic Segmentation
Region
City
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22
this availability of infrastructure like roads & electricity make the task of
geographic segmentation important.
For most products, penetration levels in rural areas are lower than in
urban areas. E.g.: Haats & mandis serve important roles in the exchange of
goods & services in rural areas.
(ii)
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(iii)
23
24
Innovator. These consumers are on the leading edge of change, have the
highest incomes, and such high self-esteem and abundant resources that
they can induldge in any or all self-orientations. They are successful,
sophisticated, active. Image is important to them as an expression of taste,
independence, and character. Their consumer choices are directed toward
the "finer things in life." Purchases often reflect cultivated tastes for
relatively upscale, niche oriented products and services.
Thinkers. These consumers are the high-resource group of those who are
motivated by ideals. They are mature, satisfied, reflective people who are
responsible, well-educated professionals. They value order, knowledge
and responsibility. Their leisure activities center on their homes, but they
are well informed about what goes on in the world and are open to new
ideas and social change. They have high incomes but are practical
consumers and rational decision makers. Thus they favour durability,
functionality and value in products.
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Believers. These consumers are the low-resource group of those who are
motivated by ideals. They are conservative, conventional, traditional and
predictable consumers with concrete beliefs. They favor familiar products
and established brands. Their lives are centered on family, community,
and the nation. They have modest incomes.
Achievers. These consumers are the high-resource group of those who are
motivated by achievement. They are successful work-oriented people who
get their satisfaction from their jobs and families. They are politically
conservative and respect authority and the status quo. They favor
established premium products and services that demonstrate success to
their peers.
Strivers. These consumers are the low-resource group of those who are
motivated by achievements. They are trendy and fun loving but have
fewer economic, social, and psychological resources. Style is extremely
important to them as they strive to emulate people they admire.
Experiencers. These consumers are the high-resource group of those who
seek variety and excitement. They are the young and enthusiastic. They
have a lot of energy, which they pour into fashion, entertainment and
socializing. They are avid and impulsive consumers, spending heavily on
clothing, fast-foods, music, and other youthful favorites, with particular
emphasis on new products and services.
Makers. These consumers are the low-resource group of those who are
motivated by self-expression. They are practical people who value selfsufficiency. They are focused on the familiar-family, work, and physical
recreation-and have little interest in the broader world. As consumers, they
appreciate practical and functional products.
Survivors. These consumers have the lowest incomes. They have too few
resources to be included in any consumer self-orientation. They are elderly,
passive people who are concerned about change. They tend to be brand-loyal
consumers.
(iv)
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Non user
Ex user
Potential user
First time user
Regular user
o Usage Rate
Light
Medium
Heavy
Lets take the example of beauty parlors or personal care. There are some customers who
use a lot of personal care products whereas others do not use personal care products
much. Thus depending on their usage the customers can be targeted.
Buyer Readiness Stage : It groups individuals according to their readiness to
purchase the product. This segmentation model is particularly useful in
formulating and monitoring the marketing communication strategies employed
to move consumers towards purchase of a product or brand. Some consumer
may be unaware about the product, some are aware, some are informed, some
are interested, some desire the product and some may intend to buy this all
helps in designing the marketing programs.
Attitude: Five attitude groups can be found in market enthusiastic, positive,
indifferent, negative and hostile. For making a product or its communication
stategy or its marketing strategy, it is important to analyse and evaluate the
attitude of target consumers too.
Q.4
Ans.: The starting point for discussing segmentation is mass marketing. In mass
marketing, the seller engages in mass production, mass distribution & mass
promotion of one product for all buyer. Eg: Henry ford offered the model T-ford
in one color i.e. black.
The argument for mass marketing is that it creates the largest potential market,
which leads to lower cost, which in turn can lead to lower prices and higher
margins. However, proliferation of advertising media & distribution channel is
making it difficult and increasingly expensive to reach a mass audience.
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Therefore more companies are turning to micro marketing at one of four levels:
segments, niches, local & individual.
Segment Marketing : A market segment consist of a group of customers who
share a similar set of needs & wants. Eg: We can distinguish between car buyers
who are primarily seeking low cost basic transportation, seeking a luxurious
driving experience & those seeking driving thrills & performance.
But we should not get confuse in between segment & sector . A car company
might say that it will target young, middle income car buyers. The problem is
that young, middle income car buyers will differ about what they want in a car.
Some may want a low cost car while others will want an expensive car. Young
middle car buyers are a sector, not a segment.
The marketer does not create the segments, the marketers task is to identify the
segments & decide one which to target. Segment marketing offers key benefits
over mass marketing as the company can design better price & deliver the
product or service to satisfy the target market.
Niche Marketing : A niche is a narrowly defined customer group seeking a
distinctive mix of benefits. Marketers usually identify niches by dividing a
segment into sub segments. The customers in the niche have distinctive sets of
needs, they will pay a premium to the firm that best satisfies their needs, the
niche is not likely to attract other competitors & the niche has size, profit &
growth potential.
Eg : (i) Ezee, the liquid detergent from godrej is a fabric washing product for
woolen clothes
(iii)
Crack and ointment for pain is another product with niche focus. This
product is primarily targeted at women for prevention of cracked heels.
(iv)
(v)
(vi)
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specialized branches that cater to the needs of corporate customer. The in city
courier companies in many cities specialize in delivering packets on the same
day.
The marketing activities concentrate on getting as close and personally relevant
to the individual customers as possible.
Customization : The ultimate level of segmentations leads to one to one
marketing. Todays customers are taking more individual initiative in
determining what & how to buy. They log on to the internet, look up
information, evaluates the product /service & in many cases, design the product
they want. Companies sees it more efficient as the marketers can achieve more
precision & effectiveness by addressing individual needs.
Q.5
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a) A single segment strategy involves the firm choosing its single preferred market
segment and targeting it with a single marketing mix, aimed at serving the
segment as well as possible. This is generally chosen by a smaller firm, or one
which has only located one attractive market segment.
Example: Speciality Hospitals focus on specific therapeutic areas such as cancer
care, heart care, neonatal care etc.
b) A selective specialization occurs when a firm targets its products at a variety of
different segments using different marketing mixes. Often the product
characteristics may be different across different segments; however it may be
only the marketing and promotional details that are different across the
segments
c) A product specialisation strategy occurs when a firm possesses a particularly
attractive product, and hence tailors it to a variety of feasible market segments.
d) A market specialization strategy involves a firm which finds one market
segment very attractive, and hence that segment a variety of different products.
32
This is often done by a firm to fill up a segment, and hence discourage any
competitors from entering.
e) Full market coverage occurs when a firm tries to serve all segments in an entire
market. This does not always imply a mass market strategy; instead a firm can
offer a variety of marketing mixes to every major segment in a market. This is
what many supermarket chains have attempted with their value, standard and
premium ranges.
Another strategy whose use is increasing is individual marketing, in which the
marketing mix is tailored on an individual consumer basis. While in the past
impractical, individual marketing is becoming more viable thanks to advances in
technology.
Q.7)
Ans:
Positioning is what the customer believes about your product's value, features,
and benefits; it is a comparison to the other available alternatives offered by the
competition. These beliefs tend to based on customer experiences and evidence,
rather than awareness created by advertising or promotion.
Positioning is what the customer believes and not what the provider wants them
to believe. Positioning can change due the counter measures taken at the
competition. Managing your product positioning requires that you know your
customer and that you understand your competition; generally, this is the job of
market research not just what the enterpreneur thinks is true.
Generally companies make marketing strategy that aims to make a brand occupy a
distinct position, relative to competing brands in the mind of the customer.
Companies can apply this strategy either by
emphasizing the distinguishing features of their brand (what it is, what it does
and how, etc.) or
they may try to create a suitable image (inexpensive or premium, utilitarian or
luxurious, entry-level or high-end, etc.) through advertising.
Marketers manage product positioning by focusing their marketing activities on a
positioning strategy. Pricing, promotion, channels of distribution, and advertising
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all are geared to maximize the chosen positioning strategy. Once a brand is
positioned, it is very difficult to reposition it without destroying its credibility.
Product positioning can be of two types :
1. Re-positioning involves changing the identity of a product, relative to the
identity of competing products, in the collective minds of the target market.
2. De-positioning involves attempting to change the identity of competing
products, relative to the identity of your own product, in the collective minds of
the target market.
Product positioning process
Generally, the product positioning process involves:
1. Defining the market in which the product or brand will compete (who the
relevant buyers are)
2. Identifying the attributes (also called dimensions) that define the product 'space'
3. Collecting information from a sample of customers about their perceptions of
each product on the relevant attributes
4. Determine each product's share of mind.
5. Determine each product's current location in the product space
6. Determine the target market's preferred combination of attributes (referred to as
an ideal vector)
7. Examine the fit between: The position of your product and the position of the
ideal vector
Q.8
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Case Study
India is also known as the Queen of Spices. It has always attracted the world with her
exotic masalas. The mystique of Indian spices magnetises the whole world to India.
'The lure of the unknown', which repeatedly brought visitors to the Spice Land, is the
presence of nature's rich elements in those fresh and highly aromatic spices.
Ramdev Food Products Pvt Ltd, was amongst the first few companies in India to
venture into branded spices. The company grew from a small flour mill to a big concern
with a decent product mix within a short span. The company had also made its
presence felt in the international market but they have preserved the same values in all
their products ever since they started as a small unit in 1965, in Ahmedabad, India. A
small step became a giant leap in no time.
36
Ramdev Food Products Pvt Ltd had been following a duel branding strategy for
catering in the global market. Within the country, it had been competing with big time
players like MDH, Badshah and Eastern through continuous innovations in packaging,
excellent quality and a strong distribution network. The company had also gone for
diversification, thereby enriching its product portfolio.
Ramdev have positioned themselves very beautifully in consumers mind not only at
national level but also at international level. They have been able to do so because of
their commitment that helped them to keep their promise of purity and freshness in all
their products for all these years.
They work on the philosophy of 'reaching a customer's heart through quality' which
has enabled them to spread the rich Indian heritage to millions of homes all over the
globe. And that's their pride. Indian food. The Indian way.
Questions
Q.1)
Q.2)
Q.3)
Q.4)
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Marketing Management
c> Generation
d> Personality
10 If a marketer were to divide a market into groups based on consumer knowledge,
attitude, use, or response to a product, the marketer would be using which of the
following segmentation forms?
a> Loyalty and use segmentation
b> Behvioral Segmentation
c> Psychographic Segmentation
d> Occasion segmentation
11
39
40
Unit 3
What do you mean by the term product mix? Discuss its concept. What are
the basis of product classification?
Ans : In marketing, a product is anything that can be offered to a market that might
satisfy a want or need. The product concept proposes that consumers will prefer
products that have better quality, performance and features as opposed to a
normal product. The concept is truly applicable in some niches such as
electronics and mobile handsets.
Product mix, also known as product assortment, refers to a combination of
products manufactured or traded by the same business house. An organization
creates many products and, of course, sells them. So, the product mix is
everything organization sells. Product mix is a combination of products
manufactured or traded by the same business house to reinforce their presence in
the market, increase market share and increase the turnover for more
profitability.
A product line is a group of products within the product mix that are closely
related, either because they function in a similar manner, are sold to the same
customer groups, are marketed through the same types of outlets, or fall within
given price ranges. For example, all the courses a university offers constitute its
product mix; courses in the marketing department constitute a product line; and
the basic marketing course is a product item.
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42
Marketing Management
II.
43
On basis of use
Consumer Goods These goods are made for the use of ultimate
consumers. They are in such a form that they can be used without
commercial processing. These goods are for personal and non
business use and for household purpose.
i.
ii.
44
iii.
iv.
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46
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47
Ans.:
Stretching up
(ii)
Stretching down
48
At times, a company which has initially taken its position in the high price slot,
stretches the line downwards by offering products in the same line for the lower
end markets. This is called stretching down. Eg. Kodak introduced Kodak fun
time film to counter lower priced brands.
In some other instance, a company which has initially positioned its products for
the lower end markets, decides to make higher priced offers for the top slots.
This is called stretching up. Many markets have spawned surprising upscale
segments starbucks in coffee. Toyatas lexus, Hondas acura.
Two Way Stretch : Companies serving the middle market might decide to stretch
their line in both directions. Texas instruments introduced its first calculators in
the medium price medium quality end of the market. Gradually it added
calculators at the lower end taking market share from Bowmar & at the higher
end to complete with Hewlett Packard.
Line Filling : In line filling the firm introduces more items to the line to plug
certain gaps in its current range of offers to plug holes to keep out competitors.
Line filling is overdone if it results in confusion of consumer. The company
needs to differentiate each item in the consumers mind.
Eg. Videocon has several product lines & room air conditioners is one of them.
Videocon entered the market for air conditioners with just two or three models,
but later on introduced dozens of models.
Line Modernization Featuring & Pruning : Product lines need to be
modernized. Companies plan improvements to encourage customer migration to
higher valued, higher priced items. Companies like Microsoft & Oracle introduce
more advanced versions of their products. This is product modernization. Line
pruning is the opposite of line stretching. Here a consumers decision is taken to
reduce the no. of items in the line, the company is trying to save cost maximizes
efficiency in production.
Marketing Management
Q.4
49
Ans: Individual product decisions focuses on the important decisions related to the
development and marketing of individual products and services. Companies
have
to
develop
strategies
for
the
items
of
their
product
lines. These decisions are about product attributes, branding, packaging,
labeling, and product support services. The below things are related in
individual product decisions. Marketers make individual product decisions for
each product including:
1.
2.
3.
4.
5.
50
Ans: A brand is a name, term, sign, symbol, or design, or a combination of these that
identifies the maker or seller of a product or service from other sellers in market.
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52
Ans.: A product passes through distinct stages during its life & is called product life
cycle. The PLC is normally presented as a sales curve spanning the products
course from introduction to exit. The PLC concept says that each stage in the
cycle is characterized by a typical marketer behaviour & each stage leads to a
distinctive marketing strategy.
A product passes through 4 stages :
(a)
Introduction
(b)
Growth
(c)
Maturity
(d)
Decline
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(i) Introduction Stage : After successful test marketing of a product and making
all the required modifications in the product a marketing company
introduces the product in the market. At this stage a product is in
introductory stage of PLC which requires a focused and intense marketing
efforts to establish a clear identity and promote maximum awareness. Main
features of this stage are:
(a) At this stage, there may not be a ready market for the product so sales
remain low and limited.
(b) Profit seems a remote possibility. Thus no profits or marginal profits
are earned by the company.
(c) Demand has to be created & developed. Consumers have to be
prompted to try out the product therby encouraging many trial and
impulse purchases.
(d) One of the crucial decisions to be taken in this stage is the pricing
strategy to be adopted either market skimming or market penetration.
(ii) Growth Stage : During the market growth stage, demand for the product
increases & size of market grows. It is a period of rapid market acceptance
and substantial profit improvements. Both sales & profits goes up. But by the
time the marketer settles down with his product, competitors may enter the
scene with similar or slightly improved versions. During this stage, the goal is
to gain consumer preference and increase sales. Marketer follows competition
oriented pricing, because the total market is being shared among many firms.
Main features of this stage are:
(a) Rapid increase in sales of product.
(b) Wide acceptance of product by consumers
(c) Maximum profits to the consumers
(d) Entry of competitors
(iii) Maturity Stage : In the maturity stage, the demand tends to reach a
saturation point & there is enough supply from competitive sources. Price
competition becomes intense & exploits the brand loyalty. The marketer try
out product & packaging modification, & various promotional deals & make
special offers to new market segments so that his sales volume do not shrink.
Main features of this stage are:
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Generating New Product Ideas : New product ideas may come from
customers, dealers, in company sources including the market research
group & external research organization. Customers problems are the
most fertile ground for the generation of new product ideas. In a variety of
product, ranging from shampoos to computers, company workforce,
market research staff, R&D staff & salesmen are also sources of new
product ideas. Market research group are a particularly useful sources.
They conduct frequent studies on the consumers, products, competition
etc. These studies often reveal product gaps- gaps between existing
supply of products.
Gravity techniques like brainstorming & synectics are also
product idea generation. In brainstorming, a small group of
encouraged to come up with ideas on a specified problem. In
the real problems is initially kept away from the group & only
used for
people is
synectics,
a broader
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57
framework is given to them. Sometimes new product ideas come out just
as a matter of happening.
Eg. Portable stereo cassette player of Sony of Japan.
(2)
Idea Screening : In this stage, various new products ideas are put under
rigorous screening by evaluation committees. Answers are sought like:
It there a felt need for the new product? It is an improvement over the
new product? etc.
(3)
(4)
(5)
58
demand for the existing product can serve as the maximum limit for the
demand for the new product.
In, end use method, products that have an altogether new end use do
come to the marketer once in a while. The only way to assess the demand
for such products is to define the end use of the new product & to locate
the potential customers for it. The aggregate of potential customers in each
use category is taken as the potential demand in that category. By adding
the demand in the various use categories, one can get an indication of the
total potential demand for the new product. This is to be taken as the
upper limit of potential. In this method, the forecaster has to be
particularly cautious in defining the end use for the product.
Q.9
(6)
Actual Development of the Product : In this stage, the firm develops the
product as such. In the actual development, production & marketing
departments are actively involved besides R & D.
(7)
Market Test : Now, the new product has to be tried out in selected market
segments. Market test is essentially a risk control tool. It is experimental
marketing at minimum cost & risk. When firms decide on a full scale
manufacturing & marketing of the product on the basis of the results of
the experiment, it helps avoid costly business errors.
(8)
Test Marketing : In test marketing, the new product, with the support of
the chosen marketing mix is actually launched & marketed in few selected
cities / towns / territories. Test marketing needs careful handling. Care is
required in the first place in selecting the test markets. Test marketing is
also a time consuming process, it has to be carried out for a fairly long
duration in order to obtain a reliable indications. Eg. HUL introduced
organics, but failed.
(9)
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Package Materials
(b)
Package Aesthetics
(c)
(a)
(b)
Package Aesthetics : For enhancing the sales appeal of the package, more
& more attention is new being given to package. For Eg. Doy soap with
different animal structures. For the first time in the soap category, the
customer could see the shapes, colour & appearance of the product.
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(c)
(ii)
(iii)
(iv)
Economy packs
(v)
Sachets
(vi)
Reusable containers
Brand Equity
(b)
Product Differentiation
(c)
Product Mix
(d)
Product Planning
Ans.: (a)
Brand Equity : David Aakar defines brand equity as the unique set of
brand assets & liabilities that is linked to a brand. According to Aakar,
brand equity is the net result of al the investment of effort that a marketer
puts into building a band. It is made up of :User ship of the brand
Consumers loyalty
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Perceived quality
Positive symbols & favorable associations around the brand. Brand
equity also adds to the bottom line on a long term basis. For, when
a brand has high brand equity, it means that consumers are willing
to pay a premium for the brand & its extensions. The values of
brands owned by firms, like HLL, ITC, & the IT majors like Infosys
& wipro are many times their total assets.
Brand equity can be measured & quantified. Through it is an asset,
traditionally, brand equity has been omitted from the balance sheets
because of its intangibility. Criteria such as market share, market ranking,
brand stability & track record, stability of product category,
internationally market trends, advertising & promotional support & legal
protection are used for measuring brand equity.
(b)
(ii)
(iii)
(iv)
(v)
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(c)
(i)
(ii)
Product Mix : A product mix is the set of all products & items a particular
seller offers for sale. A product mix consist of various product line. A
companys product mix has a certain width, length, depth & consistency.
Eg. These concepts are illustrated through an example of Hindustan
Unibuer Ltd. (HUL).
The width of a product mix refers to how many different products lines
the company carries. The length of the product mix refers to the total
number of items in the mix. This is obtained by dividing the total length
(25) by the number of lines (11) or an average product length of less than
3.
The depth of product mix refers to how many variants are offered of each
product in the line. Since lux comes in 4 scents (exotic flower petals &
jojoba oil, almond oil & milk cream, fruit extracts & honey & sandal
saffron in milk cream), it has a depth of 8. The consistency of the product
mix refers to how closely related the various product liens are.
Product Mix Width
Deo.
Axe
Rexeno
Personal Laundry
Wash
Skin
Care
Hair
Care
Oral Care
Sun
Silk
Peposodent
Lux
Suf
Excel
Fair &
Lovely
Lifebuoy
Rim
Ponds Clinic
Liril
Wheel
Hamam
Breeze
Dove
Close Up
Colour Coffee
Cosmetic
Lakme
Bru
Foods
Kissan
Knors
Annpurna
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Pears
Rexona
Product
Line
length
Product mix width & product line length of HUL.
(d)
(b)
(c)
Marketing Strategy : Here, the product manager defines the mission &
marketing & financial objectives. The manager also defines those groups
& needs that the market offerings are intended to satisfy. The manager
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(e)
Q.11 Illustrate briefly the concept of pricing & the factors that influence pricing.
Ans.: Price is all around us. We pay rent for our apartment, tuition for our education,
airline, railways, buses charge you a fare, local bank charge interest for the
money a fee to your doctor etc. Thus price is not just a number on a tag or an
item.
Traditionally, price has been the major determinant of a buyers choice & is the
only element in the marketing mix that generates revenue. Pricing acquires its
importance on account of yet another factor. It is a highly risky decision area &
mistakes in pricing seriously affects the firm, its profits, growth & future.
Factors Influencing Pricing : There are internal as well as external factors that
affect pricing :Internal Factors :
(i)
(ii)
(iii)
(iv)
(v)
(vi)
Marketing Management
(vii)
Other elements of the marketing mix & their interaction with pricing
(x)
External Factors :
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
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66
(ix)
(x)
(xi)
(xii)
Q.13 What are the various routes taken by the firm in fixing the prices?
OR
What are the various methods of pricing?
OR
Explain the different pricing strategies.
Ans.: There are several methods of pricing & they can be grouped into few broad
categories :(1)
(2)
(3)
(4)
Value Pricing
(5)
(6)
Tender Pricing
(7)
(8)
Differentiated Pricing.
(1)
Cost Based Pricing : Under the cost based pricing, different methods used
are :Mark Up Pricing
Absorption Cost Pricing
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Penetration pricing in such cases will help the firm have a good coverage
of the market & keep competition out for some time.
In all demand based pricing methods, the price elasticity of demand is
taken into account directly or indirectly. Price elasticity of demand refers
to the relative sensitivity of demand for a product to changes in its price in
other words how significantly the sales of the product are affected when
price is changed. If an increase or decrease in the price of the product
results in significant decrease or increase the product is said to be price
elastic conversely, if price change does not significantly affect the sales
volume, a product is said to be price inelastic.
(3)
(4)
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(i)
Marketer recovers his costs through price, but fails to recover the
value of his product.
(ii)
(iii)
(iv)
He matches the value & price & wins customer loyalty & since the
value created is larger then his costs, he ensures his profits.
(5)
(6)
Tender Pricing : Business firms are often required to fix the prices of their
products on a tender basis. It is more applicable to industrial products &
products purchased by Institutional customers. Such customers usually go
by competitive bidding through sealed tenders. They seek the best price
consistent with the minimum quality specification & thus bag the order.
(7)
(8)
Differentiated pricing - Some firms charge different prices for the same
product in different zones/ areas of the market. Sometimes, the
differentiation in pricing is made on the basis of customer class rather
than marketing territory.
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71
(ii)
Decide the market position & price image that the firm desires for the
brand.
(iii)
Determine the extent of price elasticity of demand of the product & the
extent of price sensitivity of target customer groups.
(iv)
Take into account the life cycle stage of the product. Analyze competitions
prices.
(v)
(vi)
Choose the pricing methods to be adopted taking all the above factors into
account.
(vii)
Case Study
Vespa is an Italian brand of scooter manufactured by Piaggio. The name means wasp
in Italian.
The Vespa has evolved from a single model motor scooter manufactured in 1946 by
Piaggio & Co. S.p.A. of Pontedera, Italyto a full line of scooters and one of seven
companies today owned by Piaggionow Europe's largest manufacturer of twowheeled vehicles and the world's fourth largest motorcycle manufacturer by unit sales.
Vespas history in India
72
Folks from the era of Bajaj Chetak and LML Vespa will have a dj vu because both
these models took inspiration from the original Vespas styling. Vespa produced
scooters in partnership with Bajaj Auto in the 1960s but that ended in 1971 as Indira
Gandhis privatization programs came into place. In the 1980s, Vespa partnered with
LML Motors in India to produce the famous P series scooters. This partnership ended in
1999 because of an irresolvable dispute.
Piaggio is very optimistic about its re-entry in India. The company expects that its sales
in India will cross its global sales across various markets within 2-3 years..
However, deeper pockets are not the only thing 21st century India is now armed with.
Today aesthetics and brand value also hold importance in the minds of the urban
Indian who knows the deep rooted meaning of retro, vintage and lineage when it comes
to cars and bikes, and in this case, scooters. Vespa seems to understand that there is no
such thing as a premium market for scooters in India, yet.
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73
The under-seat storage is large enough to fit a helmet and the glove box too has
multiple storage units.
The frame of the scooter is made of very light metal, making it very easy to twist
and turn the scooter to maneuver it in Indian traffic jams.
The price of vespa has been decided at rs 66,651
Why India now?
Vespa LX 125 specifically adapted for Indians
The key for all the foreign players to be successful in India is to show high levels of
product adaptation to demographical taste. Maruti Suzuki went out of the way and
designed its latest offering, Ertiga, in Japan, keeping Indian consumers in mind. Piaggio
too, is leaving no stone unturned and has made a changes to the original European
design to appeal India Inc.
The shape of the seat has been changed to the needs of Indian women who prefer
to saddle sideways while riding pillion on scooters.
Keeping the Indian women happy, the LX 125 also has a slimmer body because
Vespa thought itd go well with the side-sitting position of the woman pillion
rider.
Considering that Indian women may wear saris while riding a scooter, the
footboard has been lowered for more leg space.
Considering Indian traffic, a louder horn has been given to the LX 125.
Considering Indian driving conditions, Vespa has also tweaked the distance
between the surface of the road to the engine of its scooter. Vespa claims that this
modification will reduce the chances of damages due to bumps and pavements.
The rear wheel ergonomics have been redesigned to make it easier for riders to
change their tires in case of a puncture.
Questions?
Q.1 According to the product classification, Vespa LX 125 can be categorized under
what all criteria. Explain
Q.2 Discuss the individual product decisions in terms of Vespa?
Q.3 Where will you place Vespa in PLC. Suggest the related appropriate strategies?
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The total number of items that the company carries within its product lines refers
to the ___________ of the product mix.
a.
width
b.
depth
c.
length
d.
consistency
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76
Unit 4
two
general
types
involving:
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77
To get better response from the target customers, you have to adopt all the
different components of the promotion mix. However, it should be noted that the
elements of the promotion mix must be coordinated and integrated so that they
reinforce and complement each other to create a blend that helps in achieving the
promotional objectives of the organization.
Q.2
1.
2.
3.
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The message carried out through publicity is in the hands of media and not
controlled by the organization/firm.
4.
Sales promotion - is any activity that offers an incentive for a limited period to
obtain a desired response from the target audience or intermediaries which
includes wholesalers and retailers. It stimulate consumer demand, market
demand and improve product availability. Examples: Contests, product
samples, Coupons, sweepstakes, rebates, tie-ins, self-liquidating premiums, trade
shows, trade-ins, and exhibitions.
Q.3
What are the advantages and disadvantages of each element of the promotion
mix?
Advantages
Disadvantages
Impersonal - cannot answer all
a customer's questions
Not good at getting customers
to make a final purchasing
decision
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Public
Relations
Q.4
Ans.:
80
(ii)
(iii)
(iv)
(v)
(vi)
Share the financial burden of the principle, provide deposits, finance the
stock till they are sold to the ultimate consumers
(vii)
Provide salesmanship.
(x)
(xi)
(xii)
Ans.: Physical distribution is the process of delivering the product to the marketing
channels & consumer. It encompasses the various activities involved in the
physical flow of the product from the producers to the consumers. Marketing
logistics is somewhat larger in scope compared to physical distribution. It covers
physical distribution plus a part of the task of marketing channels. Marketing
logistic bring in greater value addition in the delivery chain beyond
transportation or distribution.
Objectives of Physical Distribution / Marketing Logistics :
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81
1)
2)
3)
4)
5)
Ensures the physical flow of the product from the producer to the
consumer. Without this flow, marketing cannot take place.
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Transportation
(b)
Warehousing
(c)
Inventory Management
(a)
Transportation
on :-
Transportation
management
involves
Warehousing :
Role & Importance of Warehousing :
decision
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83
Q.7
84
OR
What are the different levels of channels?
Ans.: Most producers do not sell their goods directly to the final users, between them
stand a set of intermediaries performing a variety of functions. These
intermediaries constitute a marketing channel. Marketing channels are sets of
independent organization involved in the process of making a product or service
available for use of consumption. They are set of pathways a product or service
follows after production, culminating in purchase & use by the final end user.
Types of Marketing Channels :
1
Retailer / dealer
Marketer
Broker
C & F agents
Franchises
Redistribution stockiest
10
Authorized representatives
Distributor / Wholesaler
11
Commission agents
Semi wholesaler
12
Jobbers
1)
2)
3)
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85
Q.8
4)
5)
(ii)
(iii)
(iv)
(v)
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(vi)
Share the financial burden of the principle, provide deposits, finance the
stock till they are sold to the ultimate consumers
(vii)
Provide salesmanship.
Q.9
(ix)
(x)
(xi)
Ans.:
b)
Exclusive retailing
c)
d)
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87
b)
Network marketing
c)
Consumer fairs
d)
a)
Catalogue marketing
b)
c)
Tele marketing
Online marketing
Case Study
Parle Products has been India's largest manufacturer of biscuits and confectionery for
almost 80 years. Makers of the world's largest selling biscuit, Parle-G, and a host of
other very popular brands, the Parle name symbolizes quality, nutrition and great taste.
With a reach spanning even to the remotest villages of India, the company has
definitely come a very long way since its inception.
Available Anywhere
Today, the great strength of Parle Products is the extremely widespread distribution
network. Even at the remotest places, you can buy Parle biscuits and sweets from the
local grocer. It has taken years to create this extensive network. Parles sales force
started with one salesman in Bombay and some agents in few other cities. Gradually,
Parle Products expanded. Soon sweets and biscuits were being sent by rail to Calcutta,
Delhi, Karachi, Madras and other major cities. As production increased, distribution
was amplified. Full time salesmen were appointed in different areas. Currently, Parle
Products has over 33, 00,000 distribution outlets.
The Parle G Distribution Network
Intensive Distribution
Parle uses Intensive Distribution for Parle G. This is the ideal strategy for the market
leader
88
Channel Dynamics
Parle has a multi-channel marketing system since it uses more than two marketing
channels to reach all its customer segments.
Parle Distribution Strategy
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89
The Distributors
Trade Marketing
The company is organizing various Total Quality Management initiatives and
workshops. Here various counseling measures are undertaken by the company to
improve the overall working of the distribution network.
The Retailers
Trade schemes:
these are undertaken by the company only for the hard selling items e.g. Biscuits
and Snacks etc. for these the company raises the margins by 2%, also schemes
like good packaging in case of butter and cheese is undertaken by the company.
However this is only a short-terminitiative to push the products of the company.
Glow boards:
the company puts up glow boards at the retailer and pays the major portion of
the cost.
Schedule of the salesmen:
they provide the retails with this schedule so the retailers can pre estimate the
quantities of the various products needed.
Infrastructure facilitation:
the company facilitates the retailers to buy beautiful stalls by formulating an easy
payment program and a commitment to buy back the equipment at a reasonable
price when the value of the equipment has depreciated.
Questions :Q.1 What makes Parle a king of distribution?
Q.2
How do Parle managed to penetrate deep into the remotest places in Indian
market?
90
If your company were to make a product such as a suit of clothes and sold that
product to a retailer, your company would have sold to the ___________ market.
a.
reseller
b.
business
c.
government
d.
service
If your company were to make light bulbs to be used in photocopiers, you would
most likely be selling to a ________________ market.
Marketing Management
a.
b.
c.
d.
reseller
business
government
service
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92
Unit 5
What is marketing research? State its need & importance in the marketing
scenario?
OR
Define marketing research. What is its need & importance?
Ans.: Marketing Research is the systematic, objective & exhaustive search for & study
of the facts relating to any problem in the field of marketing.
Or
Marketing Research is systematic problem analysis, model building & fact
finding for the purpose of decision making & control in the marketing of goods
& services.
OR
Marketing Research is the systematic gathering, recording & analysis of data
about problems relating to the marketing of goods & services.
Marketing research plays an equally important role in marketing management
and uses marketing information as its input, it simultaneously generates more of
it as output.
Need of Marketing Research
There may be many reasons for carrying out market research. It may be carried out
to find out
the likes and dislikes of the customers,
the marketing environment and economic conditions
appropriate price for the product,
how many people might buy the product.
Marketing Management
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94
be costly. Many firms do not have the proficiency to carry wide surveys for
collecting primary data, and might not also able to hire specialized market
experts and research agencies to collect primary data. Thus, in that case, they go
for obtaining secondary data that is cheaper to obtain but it cannot be always
correctified upto the mark.
Time constraints MR faces time constraint. The firms are required to maintain
a balance between the requirement for having a broader perspective of customer
needs and the need for quick decision making so as to have competitive
advantage, in order to maintain or improve their position in the market
MR is not a complete solution to any marketing issue as there are many
dominant variables between research conclusions and market response.
Reliability of the data the value of any research findings depend critically on
the accuracy of the data collected. MR is not free from bias. The results of MR
are very vague as it is carried out on consumers, suppliers, intermediaries, etc.
who are humans who have a tendency to behave artificially when they know
that they are being observed.
Many business executives and researchers have ambiguity about the research
problem and its objectives. They have limited experience of the notion of the
decision-making process. This leads to carelessness in research and researchers
are not able to do anything real.
Legal & ethical constraints the Data Protection Act (1998) is a good example of
a law that has a number of implications for market researchers collecting and
holding personal data. For instance, researchers must ensure that the data they
obtain is kept secure, is only used for lawful purposes and is only kept for as
long as it is necessary. It must be made clear as to why data is being collected
and the consent of participants must be obtained. In addition to this, there are a
number of guidelines, laid down by such organisations as the Market Research
Society, that, although not legally binding, encourage organisations to behave
ethically when dealing with members of the public.
Q.3
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95
The objective of this research is broad. Its goal is to find out the price
expectations of consumers, their reactions and responses to different price levels
of product to ascertain elasticity of demand. It also deals with pricing research
and pricing strategy decision. It focuses on finding best business optimum priceproduct-feature configurations in the context of market positioning
opportunities. Both qualitative and quantitative pricing research tools are used.
Product Research
MR may be used in the area of product planning and development. It helps us
To evaluate new product ideas
To evaluate the need of consumers need and requirements
To evaluate the need of change and modifications in existing product
To test the product positioning and product acceptance etc
Product market research serves several goals as it comprises the research,
analysis, evaluation of product in terms of its design, features, quality, product
lines etc
Distribution Research
As the name itself says, the distribution research is all related to the distribution
management of a firm . It helps in examining, evaluating, determining the
various distribution channels, its accessibility, its availability, relative
effectiveness of various distribution channels, assessment of intermediaries
support etc
Concept Testing
Concept testing research evaluates advertising concepts, ad theme concepts and
appeals, new product concepts, pricing, brand concepts, brand names, and
positioning strategy concepts. We select techniques -- qualitative and
quantitative -- to both develop concepts, refine, and screen to assess market
potential.
96
Positioning Research
It requires understanding the market positioning concept, current and potential
markets, and the process needed to generate brand name impact. It offers
experienced market positioning and creative branding research capabilities to
define and go-to-market with a high-impact positioning strategy.
Customer Satisfaction Research
This research is basically focused upon the concerns related to customer
satisfaction. Normally customer expectations rise overtime as advances in
technology takes place. Also in many categories technology advancements boost
the consumer consciousness. This all requires a need of market research to find
what the customers expectations are? And what are customers current need and
requirements?
Branding Research
Branding decisions drive branding marketing research strategy. Corporate,
product and advertising brand development is a mix of creativity and marketing
information to uncover brand positioning opportunities in cluttered market
spaces.
Brand Equity Research
Brand equity research measures the breadth and depth of brand power in your
target markets. We use both standard and custom tailored brand equity survey
measurements. A key to research design is the goal of a brand equity
measurement study.
Advertising Research
Advertising research can be done to determine specific advertising goals and the
stage of ad development, or campaign. It can be used to determine and examine
various important elements of advertising copy e.g basic theme, ideas, appeals,
headline, conviction value, attention value etc. Broad range of advertising
research techniques include ad recall surveys, message and theme salience and
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97
Q.4
What is to be researched?
(ii)
Why it is to be researched?
98
The end product of this exercise has to be a clear definition of the problem
& research objectives.
(2)
(ii)
(iii)
(iv)
(v)
Marketing Management
99
(ii)
(iii)
Contact Methods : Once the sampling plan has been determined, the
marketing researcher must decide how the subject should be contacted;
through mail, questionnaire, telephonic interview, personal interview,
online interview.
(3)
(4)
Analyze the Information : The next step is to extract findings from the
collected data. The researcher tabulates the data & develops frequency
100
Q.5
(5)
Present the Findings : The researcher should present findings that are
relevant to the major marketing decisions.
(6)
Ans.: Panel Research : Panel Research is a research technique similar to the survey.
Panel research uses the same sample over & over again for collecting the
information. The researcher interviews or otherwise gathers data from the same
people constituting the panel. A panel refers to a sample of respondents, who
may be individuals, households, retail shops or firms from whom information is
collected about their buying behaviour. The panel members maintain a diary &
note down details of purchases advertisement exposures, shopping patterns and
features that the researchers is interested in.
Types of Panel :
(a)
(b)
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101
purchases during the period, how much stock they hold, sales levels of
difference brands, price trends etc. This techniques is called as Inventory
& Purchase audit.
(c)
Advantages :
(i)
(ii)
Disadvantages :
(i)
Panel requires a greater degree of cooperation between the panel & the
researcher.
102
Pilot survey
(b)
Field Work
Selection of investigators
Collection of data
(c)
Processing
Processing of data
Tabulating
(d)
(e)
Report Making
Summarizing findings & recommendations
Report writing
Other MR Techniques :
(1)
(2)
Marketing Management
Q.6
103
Ans: Marketing controls help monitor progress toward goals for customer satisfaction
with products and services, prices, and delivery.
These are: Annual plan control; Profitability control; Efficiency control and
Strategic control, which are described briefly as under:
1. Annual plan control:
Annual plan control is the monitoring of current marketing efforts and results to
ensure that the annual sales and the profit goals are achieved. Annual plan control
signifies continuous ongoing performance verification against the annual plan and
taking the necessary corrective actions. It is the responsibility of the top and middle
management and the purpose is to examine whether planned results are being
achieved in terms of sales, profits, costs, finance, attitudes of participants in
marketing operations.
Sales analysis: It refers to detailed study of sales performance undertaken to
develop a comprehensive understanding of its multi-dimensional aspects and its
overall behavioral pattern. The purpose of sales analysis is to trace and
understand sales pattern over a period of time, compare it with the target
pattern, analyze variations, if any, and prescribe the corrective action warranted.
Such a sales analysis may be total sales or directed into regions, products and
customers. Break-up analysis is undertaken to ascertain whether the 80-20 rule
applies; if it doesnt then the management is to redirect the sales efforts region
product and customer wise to adhere to 80-20 principle.
Market share analysis: Market share analysis is the study of firms sales in
relation to its competitor or competitors performance; rather it is to ascertain the
percentage share of the firm in the industrys sales. The purpose is to identify the
companys hold or the status in the industry vis--vis its competitors and to
determine whether it has attained the target market share both in segregate and
break-up aspects like products, regions and the customers. If used in
combination with sales analysis, market share analysis should reveal certain
useful clues regarding the firms marketing performance.
104
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o
105
This ratio is one that measures the relationship between the credit sales and the
average receivables or the sundry debtors out-standing during the accounting
period. In fact, it warrants calculation of two ratios as under:
Customer attitude tracking: Customer attitude tracking is a qualitative measure
of market share changes. It is a system that monitors the attitudes of customers,
dealers and other participants in marketing efforts. Constant monitoring of
customer preferences and satisfaction provide early warnings to the
management to take early action. There are three major customer attitude
tracking systems namely,
o
o
o
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107
108
in six points ranking ranging between one to superior with intermediate ranks
as poor, fair, good, and very good.
Marketing Audit: The marketing audit is a fundamental part of the marketing
planning process. It is conducted not only at the beginning of the process, but
also at a series of points during the implementation of the plan. The marketing
audit considers both internal and external influences on marketing planning, as
well as a review of the plan itself.
There are a number of tools and audits that can be used, for example SWOT analysis
for the internal environment, as well as the external environment. Other examples
include PEST and Five Forces Analyses, which focus solely on the external
environment.
In many ways the marketing audit clarifies opportunities and threats, and allows the
marketing manager to make alterations to the plan if necessary.
Case Study
Cherry International (CI) is led by Rajan Cherian, a mechanical engineer from BITS
Pilani, with over 20 years of marketing experience in dealing with Government and
Private Sector in India. He gained 11 years experience in a Multinational Company in
India, deploying marketing strategies with various mining, material handling and
chemical industries. Later he started his own marketing company in India before
migrating to Australia in 1992. The thing that sets Rajan Cherian apart from most other
export consultants is that he will travel to India and work on your behalf - just as if he
were your employee! Whether it is to check out the background to a Tender application,
or dig out information about companies- he'll work with you to achieve success. He will
assist you and your staff to ensure a positive interaction with your representatives and
customers in India.
He speaks/understands 6 Indian languages (which helps in unravelling both the
social norms and what is really being said in discussions!).
He has extensively travelled to all parts of India, from Mumbai (the financial
centre) in the West, to Calcutta (the no-hurry centre) in the East, to Delhi (the fast
buck centre) in the North, to Chennai (the slow-waking centre) in the South.
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109
A. Market Research
tele-research
detailed market research report (industrial market research specialisation)
market visits
B. Business Strategy
entry strategy: pricing/packaging/promotion
state of the industry
industry terms and conditions/ payment methods
competitors activities
competing technologies
customs and import requirements
legal implications/requirements
C. Marketing Services
finding distributors/ wholesalers/agents
advertising
telemarketing and direct marketing
test/seed marketing
Global Tender notices
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Marketing Management
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Questions
Q.1 How Cherry International has helped the international export houses to
introduce them in India?
Q.2 How the services being offered by CI has helped the companies in research and
development?
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In 1985, the Coca-Cola Company made a classic marketing blunder with its
deletion of its popular Coca-Cola product and introduction of what it called
New Coke. Analysts now believe that most of the company's problems
resulted from poor marketing research. As the public demanded their "old
Coke" back, the company relented and reintroduced Coca-Cola Classic (which
has regained and surpassed its former position) while New Coke owns only
0.1 percent of the market. Which of the following marketing research mistakes
did Coca-Cola make?
a.
They did not investigate pricing correctly and priced the product too high.
b.
They did not investigate dealer reaction and had inadequate distribution.
c.
They defined their marketing research problem too narrowly.
d.
They failed to account for the Pepsi Challenge taste test in their marketing
efforts.
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Key Terms
Market: In terms of marketing, market refers to the group of consumers or
organizations or both at any place that is interested in the product, has the resources to
purchase the product, and is permitted by law and other regulations to acquire the
product.
Marketing: Marketing is a management process which comprises of any activity or set of
institutions, and processes through which goods and services move from producers or
sellers concept to the consumer or buyer.
Marketing Management: Marketing management can be defined as a business
discipline focussing on the practical implications of marketing tools and techniques and
the management of a firm's marketing activities and resources.
Marketer: A person who indentifies the needs and requirements of the consumer,
produces goods and services according to consumers requirements and needs and then
sells them through marketing on behalf of a company.
Prospects: A prospect is a potential customer or sales lead who has actively expresses
his or her interest in the product or service.
Marketing Myopia: A companys short-sighted, temporary, narrow minded and
inward looking approach while marketing their products. In other words, when a firm
changes its marketing focus from customer to its product or the company itself, it is also
called myopia.
Market Segmentation : The process of defining and subdividing a large hetrogenous
market into clearly identifiable homogenous segments of prospective buyers having
similar needs, requirements, wants or demand characteristics
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Market Targeting : Target Marketing involves breaking a market into segments and
then the selection of a particular market sector toward which all marketing effort is
directed and concentrated
Target Market : A target market is a segment of consumers having similar needs,
requirements, wants, or demand characteristics and have been identified through
research to be the most likely to buy a particular product.
Mass Marketing/Undifferentiated Marketing : Mass marketing is a market coverage
strategy in which an entire market is served with one basic marketing strategy utilizing
mass distribution and mass media thereby ignoring all market segment differences.
Niche Marketing/Micro Marketing : Niche market is the subset of the market wherein
the firm concentrates all its marketing efforts on a small but specific and well defined
segment of the population. Niches do not 'exist' but are 'created' by identifying needs,
wants, and requirements that are being addressed poorly or not at all by other firms,
and developing and delivering goods or services to satisfy them. For eg, sports channels
like STAR Sports, ESPN, STAR Cricket, and Fox target a niche of sports lovers.
Product Mix : Product mix refers to the whole range of products and services that a
company offers to its customers. It is also known as product assortment.
Product Line : A company creates a group of products, which have many common
main characteristics. In other words, A product line is a set of related products sold by a
single company.
Product Length: Numer of products within a product line is considered as product
length
Product Width : Number of product lines a company offers.
Product Depth : It refers to the number of varieties of each product within each product
line.
Example : product line is something like Hindustan Uniliver have different products
like soaps, shampoos, etc, product width is when we see its soap category they have
various soaps....and when we take product depth it means taking certain soap
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characterstics such as in what quantity its packs are available, available fragrances
within each soap category etc.
Product Consistency: It refers to the relationship between all products in their final
destination of product lines within an organization.
Product differentiation : Differentiation is a process to make a product more attractive
by contrasting its unique qualities with other competing products. It is a marketing
process that showcases the differences between products. Product differentiation helps
in creating a competitive advantage for the seller, as customers view these products as
unique or superior.
Line stretching: Line stretching occurs when a company lengthens its product line
beyond its current range.
Line filling: "Line filling is the type of product line extension to introduce new version
of existing product in the market."
Brand reinforcement: Activity associated with getting consumers who have tried a
particular brands to become repeat purchasers and with attracting new users, Brand
reinforcement is a key objective of the growth stage of the products life cycle.
Brand revitalization : When a brand begins to lose its market share, its parent company
has to face the decision of harvesting the brand or revitalizing it before it fades from
store shelves and consumers minds. Thus, it is a strategy to recapture lost sources of
brand equity and identify and establish new sources of brand equity. This may include
product modification or brand repositioning.
Brand extensions / Brand stretching : Brand extension is a marketing strategy in
which a firm launches a new product by using an existing well developed brand name.
Marketing a product with a well-developed image uses the same brand name in a
different product category. This new category to which the brand is extended can be
related or unrelated to the existing product categories Example - Nikes brand core
product is shoes. But it is now extended to sunglasses, soccer balls, basketballs, and golf
equipments. An existing brand that gives rise to a brand extension is referred to as
parent brand
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Reference price : A pricing strategy in which a product is sold at a price just below its
main competing brand to make it look more attractive in terms of price.
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Reference Books
Marketing Management by Kotler, Keller and Jha South Asian perspective
13th Edition
Marketing Management by Ramaswamy and Namakumari 3rd Edition
Marketing Management by Kothari, Mehta and Sharma