MB0030: Marketing

Management
[Assignment SET1 & SET2]

Name : P. Srinath
SMDUE ID : 520923307
Center : Mehbub College Campus, Secunderabad
Subject Code : MB0030
Subject : Marketing Management
 ASSIGNMENT MBA SEM II Subject Code:
MB0030 SET 1
1. Explain the meaning of marketing and its importance in business?
Traditionally, marketing analysis was structured into three areas:
Customer analysis, Company analysis, and Competitor analysis (so-called
"3Cs" analysis). More recently, it has become fashionable in some marketing
circles to divide these further into certain five "Cs": Customer analysis,
Company analysis, Collaborator analysis, Competitor analysis, and analysis of
the industry Context.
Department analysis is to develop a schematic diagram for market
segmentation, breaking down the market into various constituent groups of
customers, which are called customer segments or market segmentations.
Marketing managers work to develop detailed profiles of each segment,
focusing on any number of variables that may differ among the segments:
demographic, psychographic, geographic, behavioural, needs-benefit, and
other factors may all be examined. Marketers also attempt to track these
segments' perceptions of the various products in the market using tools such
as perceptual mapping.
In company analysis, marketers focus on understanding the company's
cost structure and cost position relative to competitors, as well as working to
identify a firm's core competencies and other competitively distinct company
resources. Marketing managers may also work with the accounting
department to analyze the profits the firm is generating from various product
lines and customer accounts. The company may also conduct periodic brand
audits to assess the strength of its brands and sources of brand equity.
The firm's collaborators may also be profiled, which may include
various suppliers, distributors and other channel partners, joint venture
partners, and others. An analysis of complementary products may also be
performed if such products exist.
Marketing management employs various tools from economics and
competitive strategy to analyze the industry context in which the firm
operates. These include Porter's five forces, analysis of strategic groups of
competitors, value chain analysis and others. Depending on the industry, the
regulatory context may also be important to examine in detail.
In Competitor analysis, marketers build detailed profiles of each
competitor in the market, focusing especially on their relative competitive
strengths and weaknesses using SWOT analysis. Marketing managers will
examine each competitor's cost structure, sources of profits, resources and
competencies, competitive positioning and product differentiation, degree of
vertical integration, historical responses to industry developments, and other
factors.
Marketing management often finds it necessary to invest in research to
collect the data required to perform accurate marketing analysis. As such,
they often conduct market research (alternately marketing research) to
obtain this information. Marketers employ a variety of techniques to conduct
market research, but some of the more common include:
Qualitative marketing research, such as focus groups
Quantitative marketing research, such as statistical surveys

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 Experimental techniques such as test markets
Observational techniques such as ethnographic (on-site) observation

Marketing managers may also design and oversee various

environmental scanning and competitive intelligence processes to help
identify trends and inform the company's marketing analysis.
Though marketing is tied to Sales it continues to be an expenditure
that is hard to link to growth in sales. Given the economic down turn many
world economies or companies are facing... how would a function like
marketing justify itself as a necessary expenditure so it would not be cut...
budget or as a department.
In a downturn, marketing becomes even more important to the
company's bottom line, making a profit. A marketing plan is key to
establishing the dimensions of your market, where you fit according to your
product and identifying where a company should focus its marketing budget
to achieve the best overall results.
In a downturn, marketing helps to identify new markets, target new
customers and determine the value of the product. If the product that is
currently in production does not have a substantial customer base of support,
if sales are slipping and competition is securing your former market share.
Marketing helps to identify the need for a product revitalization or
reinvention.

2. Explain the relevance of BCG matrix and GE matrix with examples

This model is used to identify companys SBUs position in the market.
This model identifies the SBUs strengths weaknesses, opportunities and
threats on the basis of market growth rate and relative market share.
This model is also known as growth share matrix. The origin of the
Boston Matrix lies with the Boston Consulting Group in the early 1970s. It was
devised as a clear and simple method for helping corporations decide which
parts of their business they should allocate their available cash to. Today, this
is as important as ever because of the limited availability of credit.
However, the Boston Matrix is also a good tool for thinking about
where to apply other finite resources: people, time and equipment. Market
share is the percentage of the total market that is being serviced by your
company, measured either in revenue terms or unit volume terms. The
higher your market share, the higher proportion of the market you control.
The Boston Matrix assumes that if you enjoy a high market share you will
normally be making money (this assumption is based on the idea that you
will have been in the market long enough to have learned how to be
profitable, and will be enjoying scale economies that give you an advantage).
The question it asks is, "Should you be investing your resources into
that product line just because it is making you money?" The answer is, "not
necessarily." This is where market growth comes into play. Market growth is
used as a measure of a market's attractiveness. Markets experiencing high
growth are ones where the total market is expanding, which should provide
the opportunity for businesses to make more money, even if their market
share remains stable.
By contrast, competition in low growth markets is often bitter, and
while you might have high market share now, what will the situation look like

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 in a few months or a few years? This makes low growth markets less
attractive

Axis components:
a. Market Growth rate: the rate at which market is growing.
b. Relative Market Share: market share of the SBU dived by the market
share of the largest competitor.

Model Components:
These groups are explained below:

Dogs: Low Market Share / Low Market Growth. In these areas, SBUs
market presence is weak, so it's going to take a lot of hard work to get
noticed. Also, you won't enjoy the scale economies of the larger players, so
it's going to be difficult to make a profit.
Cash Cows: High Market Share / Low Market Growth Here, SBUs are
well-established, so it's easy to get attention and exploit new opportunities.
However it's only worth expending a certain amount of effort, because the
market isn't growing and your opportunities are limited. here we can say cash
cow can be milked.
Stars: High Market Share / High Market Growth Here SBUs are well-
established, and growth is exciting! These are fantastic opportunities, and
you should work hard to realize them.
Question Marks (Problem Child): Low Market Share / High Market
Growth These are the opportunities no one knows what to do with. They
aren't generating much revenue right now because you don't have a large
market share. But, they are in high growth markets so the potential to make
money is there. Here there are two choices, either to invest heavily to bring it
to star position or divest or liquidate from that position. Question Marks might
become Stars and eventual Cash Cows, but they could just as easily absorb
effort with little return. These opportunities need serious thought as to
whether increased investment is warranted.

Key Points
The Boston Matrix is an effective tool for quickly assessing the options
open to you, both on a corporate and personal basis. With its easily
understood classification into "Dogs", "Cash Cows", "Question Marks" and
"Stars", it helps you quickly and simply screen the opportunities open to you,
and helps you think about how you can make the most of them.

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 Limitations:
As any other marketing theories in the field, the BCG matrix model is
not perfect either. There are according problems of this theory. Some
limitations concerning the particular use of BCG include:
1. Only two dimensions market share and product or service growth
rate, are employed. These are the first limitations.
2. How to define market and how to get data about market share are
also problems.
3. High market shares dont always necessarily lead to profit at all
times. It is not the only success factor.
4. Low share or niche businesses can be profitable too, which means in
the real world some Dogs can be more profitable than cash Cows.
5. The model cannot reflect the growth rates of the general market and
market growth is not the only indicator for market attractiveness.
6. The model also neglects the effects of synergy between different
business units.

The GE screen matrix is essentially a derivation of the Boston

Consulting Groups Boston growth matrix. It was developed by McKinsey and
Co. for General Electric as it had been recognized that the Boston Consulting
Group matrix was not flexible enough to take broader issues into account The
GE matrix cross-references market attractiveness and business position using
three criteria for each high, medium and low. The market attractiveness
considers variables relating to the market itself, including the rate of market
growth, market size, potential barriers to entering the market, the number
and size of competitors, the actual profit margins currently enjoyed, and the
technological implications of involvement in the market. The business
position criteria look at the businesss strengths and weaknesses in a variety
of fields. These include its position in relation to its competitors, and the
businesss ability to handle product research, development and ultimate
production. It also considers how well placed the management is to deploy
these resources. The matrix differs in its complexity compared with the
Boston Consulting Group matrix. Superimposed on the basic diagram are a
number of circles. These circles are of variable size (see Figure 22). The size
of each represents the size of each market. Within each circle is a clearly
defined segment which represents the businesss market share within that
market. The larger the circle, the larger the market, and the larger the
segment, the larger the market share.

3. What to do mean by MIS? Explain its benefits, types and

components?
A management information system (MIS) is a system or process that
provides information needed to manage organizations effectively.
Management information systems are regarded to be a subset of the overall
internal controls procedures in a business, which cover the application of
people, documents, technologies, and procedures by management
accountants to solve business problems such as costing a product, service or
a business-wide strategy. Management information systems are distinct from
regular information systems in that they are used to analyze other

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 information systems applied in operational activities in the organization.
Academically, the term is commonly used to refer to the group of information
management methods tied to the automation or support of human decision
making, e.g. Decision Support Systems, Expert systems, and Executive
information systems.
MIS as System: MIS is a system, which makes available the right
information to the right person at the right place, at the right time, in the
right form & at the right cost.
At the start, in businesses and other organizations, internal reporting
was made manually and only periodically, as a by-product of the accounting
system and with some additional statistic(s), and gave limited and delayed
information on management performance. Previously, data had to be
separated individually by the people as per the requirement and necessity of
the organization. Later, data was distinguished from information, and instead
of the collection of mass of data, important, and to the point data that is
needed by the organization was stored.
Early on, business computers were mostly used for relatively simple
operations such as tracking sales or payroll data, often without much detail.
Over time these applications became more complex and began to store
increasing amounts of information while also interlinking with previously
separate information systems. As more and more data was stored and linked
man began to analyze this information into further detail, creating entire
management reports from the raw, stored data. The term "MIS" arose to
describe these kinds of applications, which were developed to provide
managers with information about sales, inventories, and other data that
would help in managing the enterprise. Today, the term is used broadly in a
number of contexts and includes (but is not limited to): decision support
systems, resource and people management applications, ERP, SCM, CRM,
project management and database retrieval application.
An 'MIS' is a planned system of the collecting, processing, storing and
disseminating data in the form of information needed to carry out the
functions of management. In a way it is a documented report of the activities
that were planned and executed. According to Philip Kotler "A marketing
information system consists of people, equipment, and procedures to gather,
sort, analyze, evaluate, and distribute needed, timely, and accurate
information to marketing decision makers."
The terms MIS and information system are often confused. Information
systems include systems that are not intended for decision making. The area
of study called MIS is sometimes referred to, in a restrictive sense, as
information technology management. That area of study should not be
confused with computer science. IT service management is a practitioner-
focused discipline. MIS has also some differences with Enterprise Resource
Planning (ERP) as ERP incorporates elements that are not necessarily focused
on decision support.
Any successful MIS must support a businesss Five Year Plan or its equivalent.
It must provide for reports based up performance analysis in areas critical to
that plan, with feedback loops that allow for titivation of every aspect of the
business, including recruitment and training regimens. In effect, MIS must not
only indicate how things are going, but why they are not going as well as
planned where that is the case. These reports would include performance

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 relative to cost centers and projects that drive profit or loss, and do so in
such a way that indentifies individual accountability, and in virtual real-time.

Benefits
1. Improves personal efficiency
2. Expedites problem solving(speed up the progress of problems solving in an
organization)
3. Facilitates interpersonal communication
4. Promotes learning or training
5. Increases organizational control
6. Generates new evidence in support of a decision
7. Creates a competitive advantage over competition
8. Encourages exploration and discovery on the part of the decision maker
9. Reveals new approaches to thinking about the problem space
10.Helps automate the Managerial processes.

Decision Support Systems (DSS) are a specific class of computerized

information systems that supports business and organizational decision-
making activities

Definition: Management Information Systems (MIS) is the term given to the

discipline focused on the integration of computer systems with the aims and
objectives on an organisation. It does the following functions:

Sub serves managerial function

Collects stores , evaluates information systematically and routinely
Supports planning and control decisions
Includes files , hardware , software , software and operations research
models
It Facilitates planning
In Minimizes information overload
MIS Encourages Decentralization
It brings Co ordination
It makes control easier
MIS assembles, process , stores , Retrieves , evaluates and
Disseminates the information

Types
Management information systems are those systems that allow
managers to make decisions for the successful operation of businesses.
Management information systems consist of computer resources, people, and
procedures used in the modern business enterprise. The term MIS stands for
management information systems. MIS also refers to the organization that
develops and maintains most or all of the computer systems in the enterprise
so that managers can make decisions. The goal of the MIS organization is to
deliver information systems to the various levels of corporate managers. MIS
professionals create and support the computer system throughout the
company. Trained and educated to work with corporate computer systems,

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 these professionals are responsible in some way for nearly all of the
computers, from the largest mainframe to the desktop and portable PCs.
Management information systems can be used as a support to
managers to provide a competitive advantage. The system must support the
goals of the organization. Most organizations are structured along functional
lines, and the typical systems are identified as follows:
Accounting management information systems: All accounting
reports are shared by all levels of accounting managers.
Financial management information systems: The financial
management information system provides financial information to all
financial managers within an organization including the chief financial officer.
The chief financial officer analyzes historical and current financial activity,
projects future financial needs, and monitors and controls the use of funds
over time using the information developed by the MIS department.
Manufacturing management information systems: More than any
functional area, operations have been impacted by great advances in
technology. As a result, manufacturing operations have changed. For
instance, inventories are provided just in time so that great amounts of
money are not spent for warehousing huge inventories. In some instances,
raw materials are even processed on railroad cars waiting to be sent directly
to the factory. Thus there is no need for warehousing.
Marketing management information systems: A marketing
management information system supports managerial activity in the area of
product development, distribution, pricing decisions, promotional
effectiveness, and sales forecasting. More than any other functional area,
marketing systems rely on external sources of data. These sources include
competition and customers, for example.
Human resources management information systems: Human resources
management information systems are concerned with activities related to
workers, managers, and other individuals employed by the organization.
Because the personnel function relates to all other areas in business, the
human resources management information system plays a valuable role in
ensuring organizational success. Activities performed by the human
resources management information systems include, work-force analysis and
planning, hiring, training, and job assignments.
Components of MIS:-
1) Marketing Research System (MRS)
2) Marketing Intelligence System (MIS)
3) Internal Record System (IRS)
4) Decision Support System (DSS)

4. Suppose you need to conduct a small marketing research in your

neighborhood regarding the purchase and use of toothpastes, what
will be your approach in the process?

The approach which I will use for this type of marketing research will be Face
to Face or Direct Interview and also I will use Questionnaire Method;-

I will visit all the families in the neighborhood and find out the brand
name of the toothpaste.

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 I will write that roughly how many tubes they need every week or
month.
Whether the toothpaste they are using has proved beneficial and
whether they would be willing to shift to another brand if proved
more beneficial.
How much they spend on toothpaste every week/month. I think I
would do just this much which would be enough.
I will offer to supply the toothpastes to them at
competitive rates which most of the persons would readily accept.

5. Explain the consumer buying decision process with respect to new

product. Give example?
Research suggests that customers go through a five-stage decision-
making process in any purchase. This is summarised in the diagram below:

This model is important for anyone making marketing decisions. It

forces the marketer to consider the whole buying process rather than just the
purchase decision (when it may be too late for a business to influence the
choice!)
The model implies that customers pass through all stages in every
purchase. However, in more routine purchases, customers often skip or
reverse some of the stages.
For example, a student buying a favourite hamburger would recognise
the need (hunger) and go right to the purchase decision, skipping information
search and evaluation.
However, the model is very useful when it comes to understanding any
purchase that requires some thought and deliberation.
The buying process starts with need recognition. At this stage, the
buyer recognises a problem or need (e.g. I am hungry, we need a new sofa, I
have a headache) or responds to a marketing stimulus (e.g. you pass
Starbucks and are attracted by the aroma of coffee and chocolate muffins).
An aroused customer then needs to decide how much information (if
any) is required. If the need is strong and there is a product or service that

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 meets the need close to hand, then a purchase decision is likely to be made
there and then. If not, then the process of information search begins.
A customer can obtain information from several sources:
Personal sources: family, friends, neighbours etc
Commercial sources: advertising; salespeople; retailers; dealers;
packaging; point-of-sale displays
Public sources: newspapers, radio, television, consumer organisations;
specialist magazines
Experiential sources: handling, examining, using the product

The usefulness and influence of these sources of information will vary by

product and by customer. Research suggests that customers value and
respect personal sources more than commercial sources (the influence of
word of mouth). The challenge for the marketing team is to identify which
information sources are most influential in their target markets.
In the evaluation stage, the customer must choose between the alternative
brands, products and services.
How does the customer use the information obtained?
An important determinant of the extent of evaluation is whether the
customer feels involved in the product. By involvement, we mean the
degree of perceived relevance and personal importance that accompanies
the choice.
Where a purchase is highly involving, the customer is likely to carry
out extensive evaluation.
High-involvement purchases include those involving high expenditure
or personal risk for example buying a house, a car or making investments.
Low involvement purchases (e.g. buying a soft drink, choosing some
breakfast cereals in the supermarket) have very simple evaluation processes.
Why should a marketer need to understand the customer evaluation
process?
The answer lies in the kind of information that the marketing team needs to
provide customers in different buying situations.
In high-involvement decisions, the marketer needs to provide a good deal of
information about the positive consequences of buying. The sales force may
need to stress the important attributes of the product, the advantages
compared with the competition; and maybe even encourage trial or
sampling of the product in the hope of securing the sale.
Post-purchase evaluation - Cognitive Dissonance
The final stage is the post-purchase evaluation of the decision. It is
common for customers to experience concerns after making a purchase
decision. This arises from a concept that is known as cognitive dissonance.
The customer, having bought a product, may feel that an alternative would
have been preferable. In these circumstances that customer will not
repurchase immediately, but is likely to switch brands next time.
To manage the post-purchase stage, it is the job of the marketing team
to persuade the potential customer that the product will satisfy his or her
needs. Then after having made a purchase, the customer should be
encouraged that he or she has made the right decision.

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6. Explain the different consumer behaviour models?
ENVIRONMENTAL BUYER'S BLACK BUYER'S
FACTORS BOX RESPONSE
Buyer
Marketing Environmen Decision
Characterist
Stimuli tal Stimuli Process
ics
Problem
recognitio
n
Economic Informati
Technologic Attitudes on search
Product choice
Product al Motivation Alternativ
Brand choice
Price Political Perceptions e
Dealer choice
Place Cultural Personality evaluatio
Purchase timing
Promotion Demographi Lifestyle n
Purchase amount
c Knowledge Purchase
Natural decision
Post-
purchase
behaviour

The black box model shows the interaction of stimuli, consumer

characteristics, and decision process and consumer responses. It can be
distinguished between interpersonal stimuli (between people) or
intrapersonal stimuli (within people). The black box model is related to the
black box theory of behaviourism, where the focus is not set on the processes
inside a consumer, but the relation between the stimuli and the response of
the consumer. The marketing stimuli are planned and processed by the
companies, whereas the environmental stimulus is given by social factors,
based on the economical, political and cultural circumstances of a society.
The buyers black box contains the buyer characteristics and the decision
process, which determines the buyers response.
The black box model considers the buyers response as a result of a
conscious, rational decision process, in which it is assumed that the buyer
has recognized the problem. However, in reality many decisions are not
made in awareness of a determined problem by the consumer.
Information search
Once the consumer has recognized a problem, they search for
information on products and services that can solve that problem. Belch and
Belch (2007) explain that consumers undertake both an internal (memory)
and an external search.
Sources of information include:
Personal sources
Commercial sources
Public sources
Personal experience

The relevant internal psychological process that is associated with

information search is perception. Perception is defined as 'the process by

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 which an individual receives, selects, organises, and interprets information to
create a meaningful picture of the world'

The selective perception process

Stage Description
Selective exposure consumers select which promotional messages
they will expose themselves to.
Selective attention consumers select which promotional messages
they will pay attention to
Selective comprehension consumer interpret messages in line with
their beliefs, attitudes, motives and experiences
Selective retention consumers remember messages that are more
meaningful or important to them

The implications of this process help develop an effective promotional

strategy, and select which sources of information are more effective for the
brand.CV
Information evaluation
At this time the consumer compares the brands and products that are
in their evoked set. How can the marketing organization increase the
likelihood that their brand is part of the consumer's evoked (consideration)
set? Consumers evaluate alternatives in terms of the functional and
psychological benefits that they offer. The marketing organization needs to
understand what benefits consumers are seeking and therefore which
attributes are most important in terms of making a decision.
Purchase decision
Once the alternatives have been evaluated, the consumer is ready to
make a purchase decision. Sometimes purchase intention does not result in
an actual purchase. The marketing organization must facilitate the consumer
to act on their purchase intention. The organisation can use variety of
techniques to achieve this. The provision of credit or payment terms may
encourage purchase, or a sales promotion such as the opportunity to receive
a premium or enter a competition may provide an incentive to buy now. The
relevant internal psychological process that is associated with purchase
decision is integration. Once the integration is achieved, the organisation can
influence the purchase decisions much more easily.
Post purchase evaluation
It is common for customers to experience concerns after making a
purchase decision. This arises from a concept that is known as cognitive
dissonance. The customer, having bought a product, may feel that an
alternative would have been preferable. In these circumstances that
customer will not repurchase immediately, but is likely to switch brands next
time.
To manage the post-purchase stage, it is the job of the marketing team
to persuade the potential customer that the product will satisfy his or her
needs. Then after having made a purchase, the customer should be
encouraged that he or she has made the right decision. It is not affected by
advertisement.
Internal influences

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 Consumer behaviour is influenced by: demographics, psychographics
(lifestyle), personality, motivation, knowledge, attitudes, beliefs, and feelings.
Consumer behaviour concern with consumer need consumer actions in the
direction of satisfying needs leads to his behaviour of every individual depend
on thinking
External influences
Consumer behaviour is influenced by: culture, sub-culture, locality,
royalty, ethnicity, family, social class, reference groups, lifestyle, and market
mix factors.

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 ASSIGNMENT MBA SEM II Subject Code:
MB0030 SET 2
1. A. Give a short note on bases of Segmentation?
B. Analyse the pricing methods with relevant examples.

Bases of Segmentation
The process of dividing the market according to similarities that exist
among the various subgroups within the market is called segmentation. The
similarities may be common characteristics or common needs and desires.
Market segmentation comes about as a result of the observation that all
potential users of a product are not alike, and that the same general appeal
will not interest all prospects. Therefore, it becomes essential to develop
different marketing tactics based on the differences among potential users in
order to effectively cover the entire market for a particular product. There are
four basic market segmentation strategies: behaviour segmentation,
demographic segmentation, geographic segmentation, and physiographic
segmentation.
Pricing methods
The main methods used are:
Return-on-investment pricing
Cashflow pricing (payback)
Competitor pricing
Price slot pricing

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 Explanation
Method
Return on The investment in publishing terms is defined as the first
Investme edition costs up to printing stage (and perhaps including
nt pricing promotional expenditure. The profit is the difference
1 between revenues from sales less printing, distribution and
royalty costs. This method is not widely used in book
publishing as the investment per title is low
Return on The cash flows are calculated for all costs and revenues
Investme directly associated with the title as above. The Internal Rate
nt pricing of Return (IRR) or Net Present Value (NPV) is then calculated.
2 This method is becoming more widely used in the media
industries as computer spreadsheets facilitate the
calculation.
Cash flow This is a simplified version of Return on Investment Pricing.
Pricing The Payback rather than the Net Present Value is calculated.
Both methods can be combined usefully
Competit This is a pricing policy rather than method of calculation. The
or pricing publisher will estimate the cost of developing a book that will
sell successfully against books from competitors. The selling
price may be different to those of competitors products if
the publisher decides to compete by offering a different
treatment, design approach, selling price, and pagination.
Price Slot Where market search proves the need for price slots, or
pricing major customers demand, publishers will work backwards
to produce books that will sell at the agreed slots

The targets under each method will depend on whether the

organization aims to make a quick profit or is aiming to build up a market or
brand. Many publishers will not invest in new titles, which do not make a fast
profit on the first printing. Organizations with, or with access to, large cash
resources, can develop titles and lists for longer term potential. In young
economies most publishers producing textbooks for the Ministry of Education
or local parents will expect to recover all new title costs in the first printing
even under competitive tendering processes.

2. Explain the benefits and demerits of the different types of

advertising media. How will a marketer decided on the suitable
media for his/her products?
Newspapers
Benefits
Your ad has size and share, and can be as large as necessary to
communicate as much of a story as you care to tell.
The distribution of your message can be limited to your
geographic area.
Split-run tests are available to test your copy and your offer.
Free help is usually available to create and produce your ad.
Fast closings. The ad you decide to run today can be in your
customer's hands two days from now.
Demerits

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 Clutter. Your ad has to compete for attention against large ads
run by supermarkets and department stores.
Poor photo reproduction limits creativity.
A price-oriented medium. Most ads are for sales.
Short shelf life. The day after a newspaper appears its history.
Waste circulation. You're paying to send your message to a lot
of people who will probably never be in the market to buy from you.
A highly visible medium. Your competitors can quickly react to
your prices.

Magazines
Benefits
High reader involvement means more attention will be paid to
your advertisement.
Less waste circulation. You can place your ads in magazines
read primarily by buyers of your product or service.
The smaller the page (generally eight and half by eleven inches)
permits even small ads to stand out.
Demerits
Long lead times (generally 90 days) mean you have to make plans a
long time in advance.
The cost for space is higher in addition to higher creative costs.

Yellow Pages
Benefits
Everyone uses the yellow pages.
Ads are reasonably inexpensive.
You can easily track your responses.
Demerits
All of your competitors are listed so you run the ad as a
defensive measure.
Ads are not very creative since they follow certain formats.

Radio
Benefits
A universal medium. Can be enjoyed at home, at work, and
while driving. Most people listen to the radio at one time or another
during the day.
Permits you to target your advertising dollars to the market
most likely to respond to your offer.
Permits you to create a personality for your business using only
sounds and voices.
Free creative help is ususally available.
Rates can generally be negotiated.
Least inflated medium. During the past ten years, radio rates
have gone up less than other media.
Demerits

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 Because radio listeners are spread over many stations, to totally
saturate your market you have to advertise simultaneously on many
stations.
Listeners cannot refer back to your ads to go over important
points.
Ads are an interruption to the entertainment. Because of this,
radio ads must be repeated to break through the listener's "tune out"
factor.
Radio is a background medium. Most listeners are doing
something else while listening, which means your ad has to work hard
to be listened to and understood.
Advertising costs are based on ratings which are approximations
based on diaries kept in a relatively small fraction of a region's homes.

Television
Benefits
Permits you to reach great numbers of people on a national or
regional level.
Independent stations and cable offer new opportunities to
pinpoint local audiences.
Very much an image-building medium.
Demerits
Ads on network affiliates are concentrated in local news
broadcasts and on station breaks.
Creative and production costs can quickly mount up.
Lead time can result in items being sold out before ad runs.
Most ads are ten or thirty seconds long, which limits the amount
of information you can communicate.

Direct Mail
Benefits
Your advertising message is targeted to those most likely to buy
your product or service.
Your message can be as long as necessary to fully tell your
story.
You have total control over all elements of creation and
production.
A "silent" medium. Your message is hidden from your
competitors until it's too late for them to react.
Demerits
Long lead times required for creative printing and mailing.
Requires coordinating the services of many people: artists,
photographers, printers, etc.
Each year over 20% of the population moves, meaning you must work
hard to keep your mail list up to date.
Likewise, a certain percentage of the names on a purchased mailing
list is likely to be no longer useful.

Telemarketing
Benefits

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 You can easily answer questions about your product/service.

It's easy to prospect and find the right person to talk to.

Cost effective compared to direct sales.

Highly measurable results.

You can get a lot of information if your script is properly structured.

Demerits
Many business use telemarketing.
Professionals should draft the script and perform the telemarketing in
order for it to be effective.
Can be extremely expensive.
Most appropriate for high-ticket retail items or professional services.

3. Write a note on new product development and product mix.

New product development: New product development NPD is a
process which is designed to develop, test and consider the viability of
product which are new to the market in order to ensure the growth or
survival of the organisation.

New Product Development Process:

Idea Generation and Screening
Concept Development and Testing
Marketing Strategy
Business Analysis
Product Development
Test Marketing
Commercialization
Product Mix: 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. Normally the product mix is within the synergy of other products
for a medium size organization. However large groups of Industries may have
diversified products within core competency. Larsen & Toubro Ltd, Godrej,
Reliance in India are some of the examples.
One of the realities of business is that most firms deal with multi-
products .This helps a firm diffuse its risk across different product groups/Also
it enables the firm to appeal to a much larger group of customers or to
different needs of the same customer group .So when Videocon chose to
diversify into other consumer durables like music systems, washing machines
and refrigerators, it sought to satisfy the needs of the middle and upper
middle income group of consumers.
Likewise, Bajaj Electricals a household name in India has almost ninety
products in i8ts portfolio ranging from low value items like bulbs to high
priced consumer durables like mixers and luminaires and lighting projects
.The number of products carried by a firm at a given point of time is called its
product mix. This product mix contains product lines and product items .In
other words its a composite of products offered for sale by a firm.

4. Select any brand of toilet soap and evaluate its positioning

strengths or weaknesses in terms of attributes, benefits, values,

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 brand name and brand equity. Also, examine how competitive
brands influence the marketing strategies of the selected soap?
LUX Soap: Lux soap was first launched in 1916 as laundry soap
targeted specifically at 'delicates'. Lever Brothers encouraged women to
home launder their clothes without fear of satins and silks being turned
yellow by harsh lyes that were often used in soaps at the time. The flake-type
soap allowed the manufacturer some leeway from lye because it did not need
to be shaped into traditional cake-shaped loaves as other soaps were. The
result was a gentler soap that dissolved more readily and was advertised as
suitable for home laundry use. Lux toilet soap was introduced in 1925 as
bathroom soap. The name 'Lux' was chosen as a play on the word "luxury."
Lux has been marketed in several forms, including bar and flake and liquid
(hand wash, shower gel and cream bath soap). Lux in step with the changing
trends and evolving beauty needs of the consumers, offers an exciting range
of soaps and Body Washes with unique elements to make bathing time more
pleasurable. One can choose from a range of skincare benefits like firming,
fairness and moisturizing. Lux stands for the promise of beauty and glamour
as one of India's most trusted personal care brands. Since its launch in India
in the year 1929, Lux has offered a range of soaps in different colors and
world class fragrances. Lux is a beauty soap of film stars. Lux recognized the
need for a compelling message about beauty that would resonate with
women of today. From the 1930s right through to the 1970s, Lux soap colors
and packaging were altered several times to reflect fashion trends. In 1958
five colors made up the range: pink, white, blue, green and yellow. People
enjoyed matching their soap with their bathroom colors. In the early 1990s,
Lux responded to the growing trend away from traditional soap bars by
launching its own range of shower gels, liquid soaps and moisturizing bars.
Lux beauty facial wash, Lux beauty bath and Lux beauty shower were
launched in 1992.

In 2004, the entire Lux range was re-launched in the UK to include five
shower gels, three bath products and two new soap bars. 2005 saw the
launch of three exciting new variants with dreamy names such as Wine &
Roses bath cream, Glowing Touch and Sparkling Morning shower gels.
Lux has recently launched its two fruit extract variants New Lux Strawberry
& Cream and Lux Peach & Cream contain a blend of succulent fruits &
luscious Chantilly cream. The most recent addition in the brand is Lux Crystal
Shine.

Study of LUX with respect to 4 Ps

a. Product
A product is anything that can be offered to a market to satisfy a need
or want. Products that are marketed include physical goods, services,
experiences, events, persons, places, properties, organizations, information
and ideas.

Product Classification
LUX is a Tangible, Non Durable Good on the basis of this classification.
LUX and other soaps fall into the category of Convenience Good

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 Sales Promotion
Sales promotion, a key ingredient in marketing campaigns, consists of
a collection of incentive tools, mostly short term, designed to stimulate
quicker or greater purchase of particular products or services by consumers
or the trade. Whereas advertising offers a reason to buy, sales promotion
offers an incentive to buy.
Sales promotion includes tools for Prominent Sales Promotion
Schemes Used By LUX
Lux presented 30 gm gold each to the first three winners of the Lux
Gold Star offer from Delhi. According to the promotional offer that Lux
unveiled in October 2000, a consumer finding a 22-carat gold coin in his or
her soap bar got an opportunity to win an additional 30 gm gold. The first 10
callers every week got a 30 gm gold each. The offer could be availed only on
100 gm and 150 gm packs of Lux soap. Lux celebrated 75 years of stardom
with the Har Star Lucky Star activity. All wrappers of Lux had a star printed
inside them. If the consumer found written inside the star, any number from
1 to 5, she would get an equivalent discount (in rupees) on her purchase
from her shopkeeper. If the consumer found 75 years written inside the
star, she will get a years supply of Lux free.

Price segments of toilet soaps

Segment Price/weight
Premium > Rs. 15 / 75 gms
Popular Rs. 8-15/75 gms
Economy < Rs. 8 /75 gms

However, recently HUL has been forced to hike its price by one rupee,
to Rs17 (for 100 gm), giving in to the pressures of inflation. This paves the
way for competing soap makers like Godrej Consumer Products (GCPL) to
take price increases.
Lux has versions in all the three price segments:
Recent pricing of Lux (100 g)
Lux Crystal Shine Rs.17
Lux Festive Glow Rs.15
Mini Lux Rs 5

STRENGTHS OF LUX

1. Strong Market Research (door to door sampling is done once a year in

Urban and Rural areas)
2. Many variants (Almond Oil, Orchid Extracts, Milk Cream, Fruit Extracts,
Saffron, Sandalwood Oil, and Honey to name a few)
3. Strong sales and distribution network backed by HLL
4. Strong brand image
5. Positioning focuses on the attractive beauty segment
6. Dynamically continuous innovation of the product and brand rejuvenation
new variants (Aromatic Glow and Chocolate Seduction and Lux White Spa

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 body wash) and innovative promotions (22 carat gold coin promotion
Chance Hai)
7. Perceived to have high value for money (strong brand promotion but
relatively lower price which is a winning combination in the popular
segment)
8. Though it is in popular segment, it is having mass appeal/market presence
across all segments (15% of the soap market captured by Lux (sales /
volume)
9. Unique advantage of having access to resources and assets of HLL

WEAKNESSES
1. Lux is mainly positioned as beauty soap targeted towards women, hence it
lacks unisex appeal
2. Usage rate/ wear rate is high and is generally mushy and soggy
3. Some variants like the sunscreen, International variant did not do well in
the market
4. Certain advertisements like the recent one with Shah Rukh Khan resulted
in controversial interpretations of the message of the advertisement and
lead to some loss of focus (of message of the advertisements)
5. Stock out problems - replenishment time is high in semi-urban/rural areas
6. Earlier positioning as the soap of the stars has somewhat alienated the
brand from a portion of the consumers especially in rural areas.

5. As a salesperson in a fast moving consumer goods company, What

kind of training and development methods do you feel are required?
How important is training for sales force and how can it be
evaluated?
Customers informed, professional salespeople continuously prepare
to meet the service and product needs of customers. Training salespeople
gives customers the assurance that you value and respect their time.
Knowledgeable, educated sales people add value. Customers trust and view
them as business partners. Customers feel their needs come first when
trained salespeople work with them.
Company Retention and morale is higher in companies that invest in
the development of all employees. Price seldom becomes an issue for the
trained sales professional. Therefore profit margins improve and
predictability of earnings leads to job stability.
The trained sales force produces more with confidence. In addition,
theyre aware of trends in the market, technology, industry and environment.
This knowledge enhances their ability to sell and the reputation of your
company.
Training programs should address knowledge, competencies, ability,
capability and skills.
The factors affecting the development of a sales team include:

External: Market and industry trends, customers, economy, government

regulation, society, competition, and personal bias.

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 Internal: Company strategy, culture of the sales team, product lines and life
cycle, customer service support, etc.

6. What is International Marketing? What are the various strategies to

enter international market? Explain?

International Marketing is defined as The performance of business

activities designed to plan, price, promote and direct the companys flow of
goods and services to consumers or users in more than one nation for a
profit. A company that wants to sell their product in other than domestic
market should understand the environmental factor, consumer behaviours,
market forces and other character relevant to the international market. After
understanding the definition, several questions may arise in your mind like
why marketer should go to the international market?

International Market Entry Strategies

Organization that plan to go for international marketing should answer some
basic question like:

In how many countries would the company like to operate

What are the types of countries it plans to enter? To answer the
above question companies evaluate each country against the market
size, market growth and, cost of doing business, competitive
advantage and risk level.

Once the market is found to be attractive companies should decide

how to enter this market. Companies can enter the international market from
any one of the following strategies they are
Exporting: Exporting is the technique of selling the goods produced in
the domestic country in a follow country with some modifications for example
Gokaldas textiles export the cloth to different countries from India. Exporting
may be indirect or direct. In case of indirect exporting, companies works with
independent international market intermediaries.
Licensing: According to Philip Kotlor, licensing is a method of entering
a follow market in which the company enters into an agreement with a
license in the follow market, offering the right to use of manufacturing,
process the trade market, patent, or other items of value for a fee or royalty.
Contract Manufacturing: Company enters the international market
with a tie up between manufacturer to produce the product or the services.
For example, Gigabyte technology had target manufacturing agreement with
D-Link India to produce and sell their mother boards.
Market Contracting: In this type a company enters the international
market by providing the no how of the product to the domestic manufacturer.
The capital, marketing and other activities are carried out by the local
manufacturer hence its less risk too.
Joint Ownership: A form of joint venture in which an international
company invest equally with a domestic manufacturer therefore it also has
equal right in the controlling operations. For example, Barbara a lingeries
manufacturer has joint venture with Gokaldas Images in India.

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 Direct investment: In this method of international market entry,
company invests in manufacturing or assembling. The company may enjoy
the low cost advantage of that country. Many manufacturing forms invested
directly in the Chinese market to get its low cost advantage. Some
governments provide incentives and companies benefits to the company
which manufacturers the product in their country. There is government
restriction in some countries to opt for direct investment, is it produce the
jobs to the local people. This made also debts on the country attractiveness.
It may become risk if the market mature or unstable government exists.

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