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Marketing
1. What is Marketing Mix?
Marketing: Marketing is an organizational function and a set of processes for creating,
communicating, and delivering value to customers and for managing customer relationships in ways
that benefit the organization and its stake holders.
It is the process of planning and executing the conception, pricing, promotion, and distribution of
ideas, goods and services to create exchanges that satisfy individual and organizational goals.
In simple way putting the right product in the right place, at the right price, at the right time.
Marketing Mix: The marketing mix refers to the set of actions, or tactics, that a company uses to
promote its brand or product in the market.
The 4Ps make up a typical marketing mix - Price, Product, Promotion and Place. However, nowadays,
the marketing mix increasingly includes several other Ps like Packaging, Positioning, People and even
Politics as vital mix elements.
Understanding the Tool
The marketing mix and the 4 Ps of marketing are often used as synonyms for each other. In fact, they
are not necessarily the same thing.
"Marketing mix" is a general phrase used to describe the different kinds of choices organizations have
to make in the whole process of bringing a product or service to market. The 4Ps is one way probably
the best-known way of defining the marketing mix, and was first expressed in 1960 by E J McCarthy.
The 4Ps are:
1) Product (or Service).
2) Place.
3) Price.
4) Promotion.
A good way to understand the 4Ps is by the questions that you need to ask to define your marketing
mix. Here are some questions that will help you understand and define each of the four elements:
1. Product/Service
What does the customer want from the product/service? What needs does it satisfy?
What features does it have to meet these needs?
Are there any features you've missed out?
Are you including costly features that the customer won't actually use?
How and where will the customer use it?
What does it look like? How will customers experience it?
What size(s), color(s), and so on, should it be?
What is it to be called?
How is it branded?
How is it differentiated versus your competitors?
What is the most it can cost to provide, and still be sold sufficiently profitably? (See also Price,
below).

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2. Place
Where do buyers look for your product or service?
If they look in a store, what kind? A specialist boutique or in a supermarket, or both? Or
online? Or direct, via a catalogue?
How can you access the right distribution channels?
Do you need to use a sales force? Or attend trade fairs? Or make online submissions? Or send
samples to catalogue companies?
What do you competitors do, and how can you learn from that and/or differentiate?

3. Price
What is the value of the product or service to the buyer?
Are there established price points for products or services in this area?
Is the customer price sensitive? Will a small decrease in price gain you extra market share? Or
will a small increase be indiscernible, and so gain you extra profit margin?
What discounts should be offered to trade customers, or to other specific segments of your
market?
How will your price compare with your competitors?

4. Promotion
Where and when can you get across your marketing messages to your target market?
Will you reach your audience by advertising in the press, or on TV, or radio, or on billboards?
By using direct marketing mailshot? Through PR? On the Internet?
When is the best time to promote? Is there seasonality in the market? Are there any wider
environmental issues that suggest or dictate the timing of your market launch, or the timing
of subsequent promotions?
How do your competitors do their promotions? And how does that influence your choice of
promotional activity?
The 4Ps model is just one of many marketing mix lists that have been developed over the years. And,
whilst the questions we have listed above are key, they are just a subset of the detailed probing that
may be required to optimize your marketing mix.
Amongst the other marketing mix models have been developed over the years is Boom and Bitner's
7Ps, sometimes called the extended marketing mix, which include the first 4 Ps, plus people, processes
and physical layout decisions.
Another marketing mix approach is Lauterborn's 4Cs, which presents the elements of the marketing
mix from the buyer's, rather than the seller's, perspective. It is made up of Customer needs and wants
(the equivalent of product), Cost (price), Convenience (place) and Communication (promotion). In this
article, we focus on the 4Ps model as it is the well-recognized, and contains the core elements of a
good marketing mix.






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2. Differentiate between Sales & Marketing.
SELLING MARKETING
Needs of the Seller Needs of the buyer
Focuses on product sales for revenue Focuses on customer needs
Company manufactures and then sells it Determines customer needs and then
delivers the product.
Views business as goods producing and selling process Views business as consumer satisfying
process
Planning is short term oriented Planning is long term oriented.
Selling customer is the last link Marketing views customer as the very
beginning link
Sales is 1:1. Marketing is 1: many.
Sales is relationship driven. Marketing is data driven.
Salespeople dont develop products. Marketers do.
Sales is very track-able. Marketing is not.
Sales is about sales. Marketing is about more than sales.


3. Explain Positioning.
A marketing strategy that aims to make a brand occupy a distinct position, relative to competing
brands, in the mind of the customer. Companies 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. Once a brand is positioned, it is very difficult to reposition it without destroying
its credibility. Also called product positioning.
Definition: Positioning defines where your product (item or service) stands in relation to others
offering similar products and services in the marketplace as well as the mind of the consumer.
Description: A good positioning makes a product unique and makes the users consider using it as a
distinct benefit to them. A good position gives the product a USP (Unique selling proposition). In a
market place cluttered with lots of products and brands offering similar benefits, a good positioning
makes a brand or product stand out from the rest, confers it the ability to charge a higher price and
stave off competition from the others. A good position in the market also allows a product and its
company to ride out bad times more easily. A good position is also one which allows flexibility to the
brand or product in extensions, changes, distribution and advertising.
If we don't define our product or service, a competitor will do it for us. Our position in the market
place evolves from the defining characteristics of our product. The primary elements of positioning
are:
Pricing - Is your product a luxury item, somewhere in the middle, or cheap, cheap, cheap.
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Quality - Total quality is a much used and abused phrase. But is your product well produced? What
controls are in place to assure consistency? Do you back your quality claim with customer-friendly
guarantees, warranties, and return policies?
Service - Do you offer the added value of customer service and support? Is your product customized
and personalized?
Distribution - How do customers obtain your product? The channel or distribution is part of
positioning.
Packaging - Packaging makes a strong statement. Make sure it's delivering the message you intend.
Positioning is our competitive strategy. What's the one thing we do best? What's unique about our
product or service? We have to identify our strongest strength and use it to position our product.

4. Differentiate between Advertising & Sales Promotion.
Advertising and sales promotions are two marketing terms that are often used interchangeably by
marketers. But they are different and they both have distinct definitions and uses. It is important to
understand the role each plays in reaching today's ever more elusive consumer.
Advertising positions a product or service against that of competitors to convey a brand message to
consumers and to enhance its value in the consumer's eyes. A television commercial for a brand new
automobile emphasizing the car's new features and styling is an example of advertising.
Sales promotions include a variety of strategies designed to offer purchasers an extra incentive to buy,
usually in the short-term. Examples of sales promotions include cents-off coupons, two-for-the-price-
of-one sales and double coupons at the grocery store, all for a limited period of time.
The key difference between advertising and sales promotion is the nature of the appeal to the
consumer. Advertising is emotional in nature and the objective is to create an enduring brand image.
Perfumes, makeup and jewelery need imaginative advertising to create the allure needed to sell these
products. Sales promotions, on the other hand, are unemotional in their approach. A cents-off coupon
for cereal appeals to the consumer's rational mind and is a sales promotion. The consumer weighs the
price of one cereal brand versus others.
Brand equity and identity typically develop over the longer term. Many advertising exposures are
required for the consumer to feel the emotional pull a product might offer. Advertising develops this
relationship over time. Sales promotions are after shorter-term gains in market share and the main
message to the consumer is not necessarily brand-oriented. Rather it is an appeal to act immediately
to purchase the product.
Advertising uses indirect and subtle methods to create a brand image while sales promotions are much
more direct. Advertising for a cell phone service might emphasize the coverage area and the many
styles of phones available. A cell phone sales promotion might emphasize a free phone for signing a
two-year contract if sign-up is within the next month.

Advertising is a message which promotes ideas, goods or services communicated through one or
more media by a sponsor while Sales Promotion consists of short-term incentives provided by a
sponsor to consumers and traders to persuade them to purchase products.
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Differences between Advertising and Sales Promotion are:
Advertising
1. A reason is offered to buy.
2. Theme is to build up brand loyalty.
3. Aim is to attract the ultimate Consumer.
4. Effective in the long run.
5. Heavy Advertising makes the brand image of the product and accord it the perception of higher
quality.
Sales Promotion
1. An incentive is offered to buy.
2. Theme is to break down the loyalty to a competing brand.
3. Aim is to attract not only Consumers but retailers, wholesalers and sellers force also.
4. Effective in the short run.
5. Heavy Sales Promotion leads to the product being perceived as having a brand image of cheaper
and lower quality product.

Advertising
Promotion
Time Long term Short term
Definition One-way communication of a persuasive message by an
identified sponsor, whose purpose is non-personal promotion
of products/services to potential customers.
A Promotion usually involves
an immediate incentive for a
buyer (intermediate
distributor or end consumer).
It can also involve
disseminating information
about a product, product line,
brand, or company.
Price Expensive in most cases Not very expensive in most
cases.
Suitable for Medium to large companies Small to large companies
Sales Assumption that it will lead to sales Directly related to sales.
Example Giving an advertisement in the newspaper about the major
products of a company
Giving free products, coupons
etc.
About A type of marketing tool A type of marketing tool
Purpose Increase sales, brand building. Increase sales.
Result Slowly very Soon
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5. What is Niche Marketing?
Market Niche: A small but profitable segment of a market suitable for focused attention by a
marketer. Market niches do not exist by themselves, but are created by identifying needs or wants
that are not being addressed by competitors, and by offering products that satisfy them.
Niche Marketing: Concentrating all 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. As a strategy, niche marketing is aimed at being a big fish in a small pond
instead of being a small fish in a big pond. Also called micromarketing or Beach-head
marketing/strategy.
A niche is a focused, targetable part of the market. You are a specialist providing a product or service
that focuses on specific client groups needs, which cannot or are not addressed in such detail by
mainstream providers.
However, it is important to understand that there is a difference between your niche and your target
market:
Your target market is the specific group of people you work for e.g. women in the City, dog owners,
creative female freelancers, ceramic collectors, and brides to be, outdoor galleries.
Your niche is the service you specialise in offering to your target market. For example various design
businesses can have creative freelancers as their client group: a design company can offer them web
design and app development, another company can offer them branding advice or photography. It is
the combination of target market and specific service that creates a niche market.

6. Discuss Strategic Planning.
A systematic process of envisioning a desired future, and translating this vision into broadly defined
goals or objectives and a sequence of steps to achieve them.
In contrast to long-term planning (which begins with the current status and lays down a path to meet
estimated future needs), strategic planning begins with the desired-end and works backward to the
current status.
At every stage of long-range planning the planner asks, "What must be done here to reach the next
(higher) stage?" At every stage of strategic-planning the planner asks, "What must be done at the
previous (lower) stage to reach here?"
Also, in contrast to tactical planning (which focuses at achieving narrowly defined interim objectives
with predetermined means), strategic planning looks at the wider picture and is flexible in choice of
its means.
Strategic Planning is a management tool that helps an organization focus its energy, to ensure that
members of the organization are working toward the same goals, to assess and adjust the
organization's direction in response to a changing environment. In short, strategic planning is a
disciplined effort to produce fundamental decisions and actions that shape and guide what an
organization is, what it does, and why it does it, with a focus on the future.
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The process is strategic because it involves preparing the best way to respond to the circumstances of
the organization's environment, whether or not its circumstances are known in advance; non-profits
often must respond to dynamic and even hostile environments. Being strategic, then, means being
clear about the organization's objectives, being aware of the organization's resources, and
incorporating both into being consciously responsive to a dynamic environment.
The process is about planning because it involves intentionally setting goals (i.e., choosing a desired
future) and developing an approach to achieving those goals. The process is disciplined in that it calls
for a certain order and pattern to keep it focused and productive. The process raises a sequence of
questions that helps planners examine experience, test assumptions, gather and incorporate
information about the present, and anticipate the environment in which the organization will be
working in the future.
Finally, the process is about fundamental decisions and actions because choices must be made in order
to answer the sequence of questions mentioned above. The plan is ultimately no more, and no less,
than a set of decisions about what to do, why to do it, and how to do it. Because it is impossible to do
everything that needs to be done in this world, strategic planning implies that some organizational
decisions and actions are more important than others - and that much of the strategy lies in making
the tough decisions about what is most important to achieving organizational success.

7. Differentiate between Core Competency & Competitive Advantage.
Distinction between Competitive Advantage and Core Competence:
1. A competitive advantage does not necessarily imply a core competence while a core
competence does imply a number of competitive advantages.

2. A competitive advantage does not constitute a sure success formula for a firm over a long
term; a core competence usually does.

3. A core competence provides a lasting superiority to the company while a competitive
advantage provides a temporary competitive superiority. And behind any lasting competitive
superiority, one can always find a core competence.

4. While a competitive advantage accrues from a functional strength in any of the manifold
functions performed by a firm, a core competence does not normally accrue from functional
strength. The strength has to be at the root of businesses and product; it has to be core
strength like a unique capability in technology or process.

5. A competitive advantage helps a firm in a specific and limited way; a core competence helps
it in a general, far-reaching and multifaceted manner. A competitive advantage provides
competitive strength to the firm in a given business or product. A core competence helps the
firm to excel in a variety of businesses and products.
To conclude, a core competence is fundamental and unique to a firm. A competitive advantage can
be easily imitated and competitors catch up fast. Core competence is an exclusive and inimitable
preserve of a firm. It is long lasting; competitors cannot easily catch up with the firm. Competitive
advantages are not unique to any firm over the long term.
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8. Explain Target Costing.
Target Cost is an estimate of a product cost which is derived by subtracting a desired profit margin
from a competitive market price.
Target costing is a pro-active cost control system. Techniques such as value analysis are used to
change production methods and/or reduce expected costs so that the target cost is met.
Target costing is a system under which a company plans in advance for the price points, product costs,
and margins that it wants to achieve for a new product. If it cannot manufacture a product at these
planned levels, then it cancels the design project entirely. With target costing, a management team
has a powerful tool for continually monitoring products from the moment they enter the design phase
and onward throughout their product life cycles. It is considered one of the most important tools for
achieving consistent profitability in a manufacturing environment.

Target costing is a process of determining the actual cost price of any product or service after
considering the desired profit margin behind the same.
Formula
Target Cost = Expected selling price Desired profit
It helps in completing the product within the set price by changing the process for the same or by
making the existing process more efficient.
The process of target costing is as below:
1. Identification of customer needs and wants
2. Selling price is planned for the needs.
3. Target cost identified which is Expected selling price Desired profit
4. Product is designed, manufacturing process is fixed and suppliers are identified keeping the
price in consideration.
5. The sample product is produced that meets the target and the production starts for selling
purposes and the product is launched.

Target costing involves setting a target cost by subtracting a desired profit margin from a competitive
market price.
A lengthy but complete definition is "Target Costing is a disciplined process for determining and
achieving a full-stream cost at which a proposed product with specified functionality, performance,
and quality must be produced in order to generate the desired profitability at the products
anticipated selling price over a specified period of time in the future."
This definition encompasses the principal concepts: products should be based on an accurate
assessment of the wants and needs of customers in different market segments, and cost targets
should be what result after a sustainable profit margin is subtracted from what customers are willing
to pay at the time of product introduction and afterwards. These concepts are supported by the four
basic steps of Target Costing:

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1. Define the Product
2. Set the Price and Cost Targets
3. Achieve the Targets
4. Maintain Competitive Costs.
Japanese companies have developed target costing as a response to the problem of controlling and
reducing costs over the product life cycle.
Objectives of Target Costing
The fundamental objective of target costing is very straightforward. It is to enable management to
manage the business to be profitable in a very competitive marketplace. In effect, target costing is a
proactive cost planning, cost management, and cost reduction practice whereby costs are planned
and managed out of a product and business early in the design and development cycle, rather than
during the latter stages of product development and production.

9. What is Market Skimming Strategy?
Definition: An approach under which a producer sets a high price for a new high-end product (such as
an expensive perfume) or a uniquely differentiated technical product (such as one-of-a-kind software
or a very advanced computer). Its objective is to obtain maximum revenue from the market before
substitutes products appear. After that is accomplished, the producer can lower the price drastically
to capture the low-end buyers and to thwart the copycat competitors.
A product pricing strategy by which a firm charges the highest initial price that customers will pay. As
the demand of the first customers is satisfied, the firm lowers the price to attract another, more price-
sensitive segment.
Therefore, the skimming strategy gets its name from skimming successive layers of "cream," or
customer segments, as prices are lowered over time. Firms often use this technique to recover the
cost of development.
Skimming is a useful strategy when:
1. There are enough prospective customers willing to buy the product at the high price.
2. The high price does not attract competitors.
3. Lowering the price would have only a minor effect on increasing sales volume and reducing
unit costs.
4. The high price is interpreted as a sign of high quality.
Reasons for price skimming
Price skimming occurs in mostly technological markets as firms set a high price during the first stage
of the product life cycle. The top segment of the market which are willing to pay the highest price are
skimmed of first. When the product enters maturity the price is then gradually lowered.

10. Discuss the Causes for Channel Conflicts.
Answer in the pdf
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11. What is Costing Leadership?
Definition: Strategy used by businesses to create a low cost of operation within their niche. The use
of this strategy is primarily to gain an advantage over competitors by reducing operation costs below
that of others in the same industry.
Cost leadership is a concept developed by Michael Porter, used in business strategy. It describes a
way to establish the competitive advantage. Cost leadership, in basic words, means the lowest cost of
operation in the industry. The cost leadership is often driven by company efficiency, size, scale, scope
and cumulative experience (learning curve). A cost leadership strategy aims to exploit scale of
production, well defined scope and other economies (e.g. a good purchasing approach), producing
highly standardized products, using high technology. In the last years more and more companies
choose a strategic mix to achieve market leadership. This patterns consist in simultaneous cost
leadership, superior customer service and product leadership.
Cost leadership is different from price leadership. A company could be the lowest cost producer, yet
not offer the lowest-priced products or services. If so, that company would have a higher than average
profitability. However, cost leader companies do compete on price and are very effective at such a
form of competition, having a low cost structure and management.

12. Explain Differentiation.
Definition: Approach under which a firm aims to develop and market unique products for different
customer segments. Usually employed where a firm has clear competitive advantages, and can sustain
an expensive advertising campaign. It is one of three generic marketing strategies (see focus strategy
and low cost strategy for the other two) that can be adopted by any firm.
Differentiation strategy: Marketing technique used by a manufacturer to establish strong identity in
a specific market; also called segmentation strategy. Using this strategy, a manufacturer will introduce
different varieties of the same basic product under the same name into a particular product category
and thus cover the range of products available in that category. For example, a soda company that
offers a regular soda, a diet soda, a decaffeinated soda, and a diet-decaffeinated soda all under the
same brand name is using a differentiation strategy. Each type of soda is directed at a different
segment of the soda market, and the full line of products available will help to establish the company's
name in the soda category. This technique is quite costly to the advertiser because each individual
product must be marketed independently, since separate marketing strategies are necessary for each
market segment. Positioning a brand in such a way as to differentiate it from the competition and
establish an image that is unique; for example, the Wells Fargo Bank positions itself as the bank that
opened up the West. Also called product differentiation.

13. What is Segmentation? How do you Segment the Market?
Answer in the pdfs



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14. What is Brand Equity?
Definition: A brand's power derived from the goodwill and name recognition that it has earned over
time, which translates into higher sales volume and higher profit margins against competing brands.

The value premium that a company realizes from a product with a recognizable name as compared to
its generic equivalent. Companies can create brand equity for their products by making them
memorable, easily recognizable and superior in quality and reliability. Mass marketing campaigns can
also help to create brand equity. If consumers are willing to pay more for a generic product than for a
branded one, however, the brand is said to have negative brand equity. This might happen if a
company had a major product recall or caused a widely publicized environmental disaster.
The additional money that consumers are willing to spend to buy Coca Cola rather than the store
brand of soda is an example of brand equity.
One situation when brand equity is important is when a company wants to expand its product line. If
the brand's equity is positive, the company can increase the likelihood that customers will buy its new
product by associating the new product with an existing, successful brand. For example, if Campbell's
releases a new soup, it would likely keep it under the same brand name, rather than inventing a new
brand. The positive associations customers already have with Campbell's would make the new product
more enticing than if the soup had an unfamiliar brand name.

15. Explain Product Life Cycle?
Definition: Product life cycle (PLC) is the cycle through which every product goes through from
introduction to withdrawal or eventual demise.
Description: These stages are:
Introduction: When the product is brought into the market. In this stage, there's heavy marketing
activity, product promotion and the product is put into limited outlets in a few channels for
distribution. Sales take off slowly in this stage. The need is to create awareness, not profits.
The second stage is growth. In this stage, sales take off, the market knows of the product; other
companies are attracted, profits begin to come in and market shares stabilize.
The third stage is maturity, where sales grow at slowing rates and finally stabilize. In this stage,
products get differentiated, price wars and sales promotion become common and a few weaker
players exit.
The fourth stage is decline. Here, sales drop, as consumers may have changed, the product is no
longer relevant or useful. Price wars continue, several products are withdrawn and cost control
becomes the way out for most products in this stage.
Significance of PLC: PLC analysis, if done properly, can alert a company as to the health of the product
in relation to the market it serves. PLC also forces a continuous scan of the market and allows the
company to take corrective action faster. But the process is rarely easy.
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There is no set schedule for the stages of a product life cycle. Differences will occur depending on the
type of product, how well it is received by the market, the promotional mix of the company, and the
aggressiveness of the competition.

16. Dealer Development strategies.
Answer in the pdfs

17. Retail - The Indian Story.
Answer in the pdfs

18. Difference between B2B and B2C sales.
Size of B2B vs. B2C Markets
B2B markets are generally small vertical markets,
often niche in size, comprised of a few thousand
sales prospects to maybe as large as 100,000
prospects
B2C markets that are typically large broad markets
of tens to thousands to millions of sales prospects
Purchasing Process
B2B sales typically have a purchasing process that is
usually defined in months and the sale is complex,
often taking additional months to complete.
B2C sales have short purchasing periods of
anywhere from a few minutes (the impulse buy), to
a few days and is a simple sale consummated
immediately.
Sales Process
B2B sales require consultative selling(selling based
on understanding a client's needs and developing a
relationship of trust) sometimes from a two-step
level sales organization including the seller's sales
force and distribution sales force.
B2C sales are usually direct to the consumer or
involve a retailer. The sales approach is a traditional
product sell of "convincing the consumer" they
need the product or service being sold.
Cost of a Sale
B2B sales are "higher ticket" purchases usually
costing from just a few thousand dollars to tens of
millions of dollars.
B2C sales can range in cost from a dollar to a few
thousand dollars. Except, for cars and homes.
Purchase Decision
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The decision to purchase in B2B sales is generally
driven by need and budgets therefore; it tends to be
a very rational decision.
B2C purchase decisions tend to be made based on
want more than need or a budget and, therefore,
are triggered by more emotional decisions.
The Value of Brand
Brand identity in B2B markets is created through
personal relationships and consultative selling.
Brand identity in B2C markets is created through
advertising and now social media.
Lifetime Customer Value
The lifetime value of B2B customers is much higher
due to the higher cost of sales and the likelihood of
repeat or add-on sales to the same customer.
The lifetime value of a B2C customer is lower than
B2B because of the lower cost of individual sales
and repeat sales are generally fewer.
These B2B versus B2C marketing differences are crucial to your marketing strategy and tactics.
Knowing your target audience, developing an appropriate B2B marketing message, and the
distribution methods of your communication messages are very different, if you are a B2B versus
B2C Company. Using big business consumer marketing tactics are not cost effective and are not
likely to produce the new business-to-business clients you seek.
Your Bottom Line:
B2B sales prospects are very different from B2C. B2B sales prospects are found in small vertical
markets require consultative selling and take longer to sell. B2B sales are "higher ticket" sales driven
by a rational sales approach that requires developing personal relationships. The payoff for B2B sales
prospects is a high lifetime customer value.
Knowing the marketing differences between B2B versus, B2C are just the beginning steps to
achieving B2B sales lead prospecting success.










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19. Explain De-marketing & Planned Obsolescence.
*De-marketing Definition: Efforts aimed at discouraging (not destroying) the demand for a product
which (1) a firm cannot supply in large-enough quantities, or (2) does not want to supply in a certain
region where the high costs of distribution or promotion allow only a too little profit margin. Common
DE marketing strategies include higher prices, scaled-down advertising, and product redesign.
It is a strategy in which marketers intentionally try to bring down the demand of a product. In this
case effort is made to decrease and not to destroy the demand. It is usually done in the following
cases:
1. When the demand is more than production capacity of the company
2. DE marketing is done in a particular region when that market is unprofitable
3. To achieve a lowered demand, marketers use methods like raising prices, providing lesser
margins, decreasing advertising and promotion spends or introduction of new packaging.

De-marketing: The process of reducing the demand for a product or decreasing consumption.
Marketing aimed at limiting market growth; for example, some governments practice de-marketing
to conserve natural resources and organizations use a de-marketing approach when there is so much
demand that they are unable to serve the needs of all potential customers adequately.
Efforts aimed at discouraging (not destroying) the demand or a product which (1) a firm cannot supply
in large-enough quantities, or (2) does not want to supply in a certain region where the high costs of
distribution or promotion allow only a too little profit margin. Common de-marketing strategies
include higher prices, scaled-down advertising, and product redesign.
Example: A case in point would be the example of IPCL (Indian Petrochemicals Corporation Limited)
which de-markets its own product saying Save Oil Save India. The impetus here is not to stave away
the consumers, it is the fact that oil being a finite resource product should be used carefully to
maximize its utility.
Another example: Experts feel that Apple has done a good job of de marketing its products. For that,
it has used pricing as a strategic tool to keep its product safely inside its target consumer segment.
Though the prices of iPhone were brought down to $399, Apple can still lower the prices which it
chooses not to do. Not surprisingly, there is a 4P of de-marketing too which is based on the exclusivity
of the product, place, price and promotions.

DE marketing basically refers to when a company discourage its customers to buy the product
produced by them. There are many reasons of adopting this strategy. Its because of shortage of
supply, want to promote their other products and the company is not having so much profit with the
sale of that product. For this companies stop promoting that product or start promoting others.
for example: This happened in case of Tata Nano, when the demand for Tata Nano increased from its
supply level then Tata started promoting their other products and completely stopped the promotion
of Tata Nano.
Other example is: when Maruti A-star was launched, for the promotion of A-star Maruti started
discoursing its customers to buy Maruti Xtilo.
15 | P a g e

**DEFINITION OF 'PLANNED OBSOLESCENCE'
Definition: Business practice of deliberately outdating an item (much before the end of its useful life)
by stopping its supply or service support and introducing a newer (often incompatible) model or
version. Its objective is to prod the consumer or user to abandon the currently owned item in favour
of the 'upgrade.' Most prevalent in computer hardware and software industry.
A manufacturing decision by a company to make consumer products in such a way that they become
out-of-date or useless within a known time period. The main goal of this type of production is to
ensure that consumers will have to buy the product multiple times, rather than only once. This
naturally stimulates demand for an industry's products because consumers have to keep coming back
again and again.

Products ranging from inexpensive light bulbs to high-priced goods such as cars and buildings are
subject to planned obsolescence by manufacturers and producers.
Also known as "built-in obsolescence".
'PLANNED OBSOLESCENCE' Explanation:
Planned obsolescence does not always sit well with consumers, especially if competing companies
offer similar products but with much more durability. Pushing this production too far can result in
customer backlash, or a bad reputation for a brand.
However, planned obsolescence doesn't always have such a negative connotation. Companies can
engage in this activity solely as a means of controlling costs. For example, a cell phone manufacturer
may decide to use parts in its phones that have a maximum lifespan of five years, instead of parts that
could last 20 years. Its unlikely most consumers will use the same cell phone five years after purchase,
and so the company can lower input costs by using cheaper parts without fearing a customers
backlash.
Planned obsolescence tends to work best when a producer has at least an oligopoly. Before
introducing a planned obsolescence, the producer has to know that the consumer is at least somewhat
likely to buy a replacement from them. In these cases of planned obsolescence, there is an information
asymmetry between the producer who knows how long the product was designed to last and the
consumer, who does not. When a market becomes more competitive, product lifespans tend to
increase. For example, when Japanese vehicles with longer lifespans entered the American market in
the 1960s and 1970s, American carmakers were forced to respond by building more durable products.