section-a 2 marks questions [question 1 to 15] …subject: marketing management (pgdbm/mba-2) 1/36...

SUBJECT: MARKETING MANAGEMENT (PGDBM/MBA-2) 1/36

Section-A 2 Marks Questions [Question 1 to 15] Page [1 to 3]

Q1. Distinguish between marketing management & sale management. Ans. Marketing management: - is the process involving analysis planning, implementation

and control that is covers goods, service and ideas; that is rests on the notion of exchange and that the goals is to product satisfaction for the parties involved.

Sales Management: - is the process include planning about the production, sales promotion and profit through sales volume. In it mgt have to consider about how they will increase sale. Mgt have to manage the sales. Not he customer satisfaction or product. Main concentration is on sale.

Q2. What is Micro Environment? Ans. The Micro Environment is the environment, which affects customer’s markets;

business markets and compares deals with the whole industry, market rather than single business. In it we deal with demographic, economic, natural technological, political and cultural development etc. of the market as a whole.

Q3. What is marketing planning? Ans. As the name suggest marketing planning deals with planning about marketing. Within

marketing planning, marketing must make decision on target market, market positioning, product development, pricing, distribution channels, physical distribution, communication and promotion.

Q4. What is marketing audit? Ans. It is control instrument to reassess periodically marketing effectiveness. It is a

comprehensive, systematic independent periodic examination of a company or business units marketing environment, objectives strategies and activities view to determining problem areas and opportunities and recommending a plan of action to improve the companies marketing performance. Those companies that discover marketing weakness go for marketing audit.

Q5. What is Direct Marketing? Ans. Direct marketing can use a large number of channels for reaching prospects and

customers. These marketing face-to-face selling, direct mail marketing catalog marketing, telemarketing, TV and other direct response media, on line channels.

Q6. What is Societal Marketing concept? Ans. Societal Marketing concept holds that the organization task is to determine the

needs, wants and interests of target and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer’s and the society well being. We can say this concept calls upon marketers to build social and ethical consideration into marketing practices.

Q7. Explain 4 P’s of Marketing. Ans. 1) Price 2) Product 3) Place 4) Promotion

McCarthy populated a four-factor classification of these tools called the four Rs., which are above.

1) Price: Price includes price list, discount, allowance, and payment period and

credit term. 2) Product: Include product variety, quality, design, features, Brand name,

packaging, sizes, services, and warranties, Returns.


3) Place: Includes decision about channels, coverage, location transport etc. 4) Promotion: Include decision about sales promotion, advertising sales force,

public relations, direct marketing etc. Q8. What is Levels of product? Ans. There are five levels of product each level adds more customers’ value.

1) Core Benefit: The fundamental services or benefits that the customer is really buying like the purchaser of the customer is really buying like the purchaser of the drill is buying “holes”.

2) Basic Product: Here the stress is on product. Acc to our e.g. On drill. 3) Expected product: A set of attribute that the buyer normally expects and

agree to when purchase product. 4) Augmented product: Which encompasses all the augmentations and

transformations that the product. 5) Potential product: Which encompasses all the augmentations and

transformations that the product might ultimately go in the future. The potential product points to the possible evolution of the product.

Q9. What is Price discrimination? Ans. Price discrimination occurs when a company sells a product or services at two or

more price that do not reflect a proportional difference in costs. Discriminatory pricing takes several forms.

1) Customer segment pricing: Different charges to diff. group. 2) Product form pricing: Diff. Version of the product charged differently. 3) Image pricing: Same item but diff. image or look charges diff. prices. 4) Location pricing: Same product is priced differently al diff. location. 5) Time pricing: Prices are varied by reason day.

Q10. What is Promotional Pricing? Ans. Promotional Pricing is one of the techniques of stimulate early purchase. Under this

scheme co. give discounts and special price offer for promoting the sales promotional pricing takes several forms.

1) Loss Leader Pricing: Here dept. drops the price on well-known brands to

stimulate additional store traffic. 2) Special event pricing: Special price offers in certain seasons to draw in more

customers. 3) Cash rebates: Cash rebates are offered to encourage sales. 4) Low interest financing: Instead of decreasing prices, the co. can offer low

interest financing like 0% financing etc. 5) Longer payment term. 6) Warranties and services contract: Services offer sales etc.

Q11. What is Product Management? Ans. In product mgt. manager has to supervise specific product & brand. In its manager

have to make product plan, implement these plans monitor the result and take corrective action when necessary. This is how the product will be managed properly & efficiently. This thing help in taking Advantages of product management.

1) Cost effective marketing mix for products. 2) Product manager can react more quickly to the problem. 3) Smaller brands are less neglected.


4) P.M. is an excellent training ground for young executive because it involves every area of the company.

But it is costlier, need experts & time consuming. Q12. What is Price Discrimination? Ans. In price discrimination seller offer different price terms to different people within the

same trade group. Basically it is illegal but it is legal when seller can prove that its costs are different when selling to different retailer. This method is used to accommodate difference in customers’ products locations and so on. It may be in any of the following different forms

1) Customer segment pricing 2) Product form 3) Image pricing 4) Location Pricing 5) Time pricing

Q13. What are the conditions for price discrimination? Ans. Condition for price discrimination but for working of price discrimination market must

be segment able, members of low price must not be able to recall the product in the higher price segments, cost of segmenting not exceed from the extra revenue etc.

Q14. What is Product line? Ans. Product line It is group of product that are closely related because they perform a

similar function, are sold to the same customer group are marketed through the same channels, or fall with in given price ranges. Different executives manage each product line.

Q15. Marketing Strategy. Ans. Marketing Strategy is also known, as game plan marketing strategy is a strategy or

plan against competitors for marketing purposes. For competing in the today market there is a need of strategies, which help, in sales promotion. The marketing strategy is often presented in list form. Marketer has to think about followed topics.

1) Target market

2) Positioning

3) Product line

4) Price

5) Distribution outlet

6) Sales force

7) Services

8) Advertising

9) Sales promotion

10) Research & development

11) Marketing research


Section-A 5 Marks Questions [Question 1 to 11] Page [4 to 11]

Q1. Distinguish between Marketing & Selling. Ans. Difference between marketing and selling is as follow:

Marketing Selling

It is a new concept It is a new concept. It Stress the wants of the It stress needs of the Buyer. Seller. It include all those It include all activities Activities in the process of which are performed in the satisfying customer’s Need process of selling. Starting focus mean end point Starting focus mean End point Target customer integrated Factory product selling profit market need marketing promotion profit through through customer satisfaction. At last we can conclude here Here main focus is product Main focus is customer needs and goal is increase in sales And goals is customer No attention on customer satisfaction. Satisfaction.

Q2. What is marketing management? Explain different concepts of marketing? Ans. Marketing is ‘how to sell the product in the market. OR we can say marketing

management is the process of planning and executing the conception, pricing, promotion & distribution of ideas, goods and services to create exchange that satisfy individual and organizational goals. William J Stanton: Marketing Management is the marketing concept is action. There are five competing concepts under which organization can chose to conduct their marketing activities.

1) The production concept 2) The product concept 3) The selling/sales concept 4) The marketing concept 5) The societal marketing concept

1) The production concept: Holds that consumers will favour those products

that are widely available and how in cost manages of production oriented org. concentrate on achieving high production oriented org. Concentrate on achieving high production efficiency & wide distribution.

2) The product concept: Holds that consumers will favor that offer the most quality, performance or innovating features. Manager in production oriented organization focus their energy on making superior products and improving them over time.

3) The selling /sales concept: Holds that consumers left alone, will ordinarily not buy enough of the organization’s products. The organization must theory undertakes an aggressive selling and promotion effort. Most firm practices the selling concept when they have over capacity. Their aim is to sell what they make rather than make what the market wants.

4) The marketing concept: Holds that the key to achieving organizational goals consists of being more effective than competitors in integrating marketing


activities towards determining & satisfying the needs & wants of target markets.

5) The societal marketing concept: Holds that the organization’s task is to determine the needs, wants and interest of target markets & to delivers that desired satisfaction more effectively & efficiency than competitors in a way that preserves or enhances the consumer’s and the society’s well being.

Q3. Explain the concept of product mix in detail. Ans. Product mix: Is the set of all product and items that a particular seller offers for sale

to buyer. A company's product mix has a certain width, length, depth & consistency.

1) Width: Product mix refers to how many different product lines the company carries. Like P& G. provide product mix width of five lines – lie hair care product, health care product, personal hygiene product, beverages, food & so on.

2) Depth: P.M. refers to how many variants are offered of each product in the

line

3) Consistency: of the product mix refers to how closely relate the various product lines are in end use, production requirement, distribution channels or some other way.

4) Length: Refers to the total number of items in its product mix.

These four dimensions of the product mix provide the handles for defining the co's product strategy. Product mix planning is largdy the responsibility of the company's strategic planners. They must assess, with information supplied by the company marketers, which product line to grow maintain, harvest & divest.

Q4. What are the different methods of pricing of product? Ans. Facts, which affect price decision, are consumer requirement & cost consideration.

Following are the basic policies recognized fro pricing.

1) Cost oriented pricing policy 2) Demand oriented pricing policy 3) Competition oriented pricing policy

1) Cost oriented pricing policy

a) Cost plus pricing or Cost oriented pricing policy: The pricing method assumes that non-product is sole at a loss since the price covers the full cost incurred. The price under this method is determined by adding a desired percentage profits on cost to the total cost of the product. Adv. It is a long-term policy 1) Policy utility services like railway, post office. are pricing though this method. 2) Where it is difficult to forecast the future demand this method is appropriate. 3) If there are few buyers of the products, pricing can be justified. Disadvantage:

1) It ignores completely the influence of competition & market demand. 4) Cost of joint products not easily estimated.

b) Rate of return or Target pricing Method:

In this method arbitrary desired rate of profit on the capital employed invested is determined by the enterprise. Total desired profit is then added to the cost of


production & thus price per unit is determined. Price per unit = Total cost of production + Total desired profit at desired rate on investment Total no. of units produced This method is good where there is no competition

c) Break even pricing: Break-even point is a point there is no profit no loss. In this analysis firm determine at what level of output revenue will equal to cost assuming certain price. There cost is divided in two parts 1) Fixed cost 2) Variable cost. Break-even price is found out by using the following equation BEP = Total fixed cost / Margin of contribution per unit.

Margin of contribution per unit = unit selling price- Unit variable

B.E Analysis helps to establish prices only when the cost of production remains reasonably constant.

d) Marginal cost or Incremental cost pricing: In this method the price is fixed on the basis of additional variable cost associated with an additional unit of product. The cost of producing and selling one more unit, i.e. the last unit is taken as the base for the pricing under this method, only variable cost is considered and recovered. Fixed cost is ignored.

Advantages:

1) Method is useful in introductory campaigns (New product should not bear fixed test)

2) When product is perishable & competitor is weak this method is good 3) In order to protect shut down & keeping labour force busy in slack reason. 4) Method is particularly useful in quoting for competitive tender & in export

marketing.

Limitation:

1) This method cannot be followed long time as its share of fixed cost remains to be unabsorbed

2) The producer may lose the market of other products because of the high cost & competitors may drive away the customer.

2) Demand Oriented Pricing Policies:

Here demand is main factor. Price is determined by simply adjusting it to the market conditions. High price is charged where the demand is intense & low price is charged when the demand is low. It has following method. Purchasing Power pricing method: Price is determined what the purchasers can bear to pay. All it depends upon their purchasing power. Retailer rather than manufacturing firm uses it more. These methods. brings high profit in the short run. But in long run it is not safe. It can be used. Where monopoly/oligopoly conditions exist where demand is inelastic with respect to price. Market penetrating pricing: Opposite to skimming pricing it offers a low introductory price to speed up its sales & therefore widening the market base. It aims at capturing


market. Competition oriented pricing: Most of the companies fix the prices of their products after a careful consideration of the competitor’s price structure. Three-policy alternative are available to the firm under this pricing method.

a) Parity pricing or going Rate pricing: Prices are determined on the price structure. Three-policy alternative are available to the firm under this pricing method.

b) Parity pricing level or discount Pricing: Firm determine price below competition level. This method is used by new firm entry the market.

c) Pricing above competitive level or premium pricing: Firm determines the price determines the price of its product above the price of the same products of the competitors. It may be due to better quality. they become the market leader.

So all the above are pricing strategies used by different firms in different situation. Q5. What is marketing implementation and different method of control? Ans. Marketing implementation is the process that turns marketing plans into action

assignments and ensures that such assignments are executed in manners that accomplished the plan's stated objective. For effective implementation of marketing progressive need for skills.

1) Skill in implementing plans. 2) Skill in implementation result 3) Skill in assessing the company level where the problem exists. 4) Skill in reorganizing and diagnosing a problem.

Different Methods of control are 1) Annual plan control: The purpose of this is to ensure that the company achieves the sale, profit and other goals in its annual plan. The heart of A.P.C. is management by objective. The prime responsibilities to top mgt & middle mgt. Purpose of this is to watch that whether the planned result are being achieved.

2) Probability control: The prime responsibility is with marketing controller. The main purpose of this is to examine whether the company is making and losing money. Companies need to measure the profitability of their various products, territories, customer group, segments, trade channels & other sizes, This information will help management determine whether any products or marketing experience should be expanded, reduced or eliminated.

3) Efficiency control: Lien and staff management and marketing controller does this control. The purpose this control is to evaluate and improve the spending efficiency and impact of marketing expenditure. This control helps in sales force, advertising sales promotion & distribution etc.


4) Strategic Control: Top management marketing auditors do this control. The purpose of this is to examine whether the company is pursuing its best opportunities with respect of markets, products and channels. This control helps in marketing effectiveness, marketing audit, marketing excellence review, company ethical and social responsibility.

Q6. What is the market research? What are the various steps undertaken in

marketing research? Ans. Marketing Research: In marketing research gather significant information about

the marketing environment like opportunities for the business, requirement of the user, strategies of the competitor, trends of the market etc. that helps the management to decide about the product program. The marketing Research Process: Effective marketing research involves the five steps. Which are as follows 1) Define the problem and Research objective:

Mgt. must not define problem too broadly or too narrowly. At this stage problem must be defined properly and the objective of the research should be made clear.

2) Develop the research plan:

After the cleverness of objective of research level. Plans should be made about research level. Plans should be made about research design approaches, Research instrument, contact methods etc. So that marketing research calls for developing the most efficient plan for gathering the needed information.

3) Collect the information: The data collection phase of marketing research is generally the most expensive and most prone to error. Collection of data can be done through interviews, observations etc. But the four problems arise some respondent will not be at home must be reconnected and other responsible will refuse to cooperate. Still others will give biased or dishonest answers. Finally some interviewers will be biased or dishonest.

4) Analyze the information: The next to last step in the marketing research process is to extract finding from the collected data. The researches will also apply some advanced statistical techniques and apply some advance statistical techniques and decision models in the hope of discovering additional findings.

5) Present the finding: The research presents the finding to the relevant parties. The researcher should present major finding that are relevant to the major marketing decision mgt.

Q7. What are the different factors affecting consumers buying behavior? Ans. A consumer's buying behavior is influenced by cultural, social personal and

psychological factors. Explanations of these are as follows: 1) Cultural factors:

a) Culture: Individual acquires a set of values, perception, preferences and behaviors through his or her family and other key institution. Culture is the most fundamental determinant of person's want and behavior.


b) Sub culture: Subculture includes nationalities, religions facial group and geographic regions. Many subcultures make up important market segment according to these segment researches design the product.

c) Social class: Social class takes the forms of a caste system where the member of the different castes is reared for certain roles. Member of these classes share similar values, interest behavior. So the marketer design product according to their needs.

2) Social factors:

Like reference group, family & social roles and statures also affect consumer-buying behavior.

a) Reference Group: A person's reference group consists of all the groups that have direct or indirect influence on the person's attitude or behavior. These groups are like family, friends, neighbour & co. worker.

b) Family: Family members are the most influential primary reference group. c) Role and status: A person's participation in many group –family clubs

organizations. The persons' position in each group can be defined terms of role and status. Role consists of activities that person is expected to perform. Each role carried a status of consumer so as to provide potential product & brands.

3) Personal Factors

a) Age and stage in the life cycle: People by diff goods and services over a lifetime.

b) Occupation and economic circumstances: Occupation also influences a person's consumption better.

c) Life style: People from same subculture social class, and occupation may lead quite different lifestyle. Lifestyle is a person's pattern of living in the world as expressed in activities, interest and option.

d) Personality and self-concept: By personality we means distinguishing psychological chrematistics that lead to relatively consistent and enduring responses to environment.

4) Psychological Factors

a) Motivation: One person has many needs. A need becomes a motive when it is aroused to a sufficient level of intensity. And this motive sufficiently pressing to drive the person to act.

b) Perception: Is the process by which individual selects organizes and interpret information input to create a meaningful picture of the world.

c) Learning: People act when they learn. Learning involves changes in an individual 's behavior, behaviors arising from experience.

d) Beliefs and Attitude: Through doing and learning people acquire belief and attitude. A belief is description thought that a person holds about something. Beliefs are persons' enduring favorable or unfavorable evolution, emotional feelings and action tendencies toward some object or idea.

So at last, we can say all these factors affect consumer's buying behavior.

Q8. What is the buying process and steps involved in it? Ans. The buying process starts when the buyer recognized a problem or need. How the

buyer go for buying. How he will chose the item. The process is known as buying process. Steps involved in buying process are:


1) Problem recognition: Buying process starts when the buyer recognized a problem or need. He should know what he wants at this stage.

2) Information search: Consumer will be inclined to search more information 1) Heightened attention: Person simply becomes more respective to information

about a product. 2) Active information: Looking for reading material, phoning friends and visiting

stores to learn about the product consumer information sources. Fall into four groups. a) Personal source b) Commercial source c) Public d) Experimental

3) Evaluation of Alternative: Proper evaluation of each and every alternative. This

evaluation starts to satisfy a need. Secondly for benefits from the product solution. Thirdly ability of advertising the benefits from the product solution. Thirdly ability of adverting the benefits to satisfy need.

4) Marketing Strategy: This decision is based on the attitude of the individual and

the unanticipated situational factors. Like if U want to opt branded product then you decision for purchasing go in that direction. The influence on individual of other also affects purchase decision.

5) Post purchase Behavior: P.P.B. of the producer also comes under the buying

process. If the consumer will experience some level of satisfaction after purchase then he/she will opt for that product for further purchase. If not then vice versa. Consumers during these days are very much aware of the benefits they can get. So they look for aware of the benefit they can get. So they look for.

1) Post purchase satisfaction 2) Post purchase Action 3) Post purchase use and disposal

Q9. What is marketing? Explain the marketing concept. Ans. Marketing

Marketing is the creation of those utilities that add value to the goods and services thereby become more useful and valuable to the consumers. Marketing includes all those activities that direct the flow of goods and services from producers to the consumers. Marketing is the process of understanding the consumer, his needs and convert their needs into wants and satisfy them his expectation levels.

The Marketing Concept Concept is philosophy, attitude a line of thinking an idea or notion relating any aspect of divine and human creations. The philosophy of an organization in the dynamic relation of marketing is referred to as a marketing concept. A concept is an orientation or a philosophy. Marketing concept is an integration of marketing activities directed towards customer’s satisfaction. It is a philosophy of business management, based upon a company-wide accomplice of the need of the important role of marketing in communicating the needs of the market to all major corporation departments. Thus, it is a way of life in which the resources of an organization are mobilized to create, stimulate and satisfy the consumer at a profit.

Q10. Discuss the evolution of Marketing Concept. Ans. With the changing times in socio-economic values and other environment forces, the

marketing concept has undergone an evolutionary change. Concept under went a change phase wise. The first concept was ‘Product concept’ that prevailed up to 1930s. This was founded on the strong belief that if a company makes available


really god products, there is no need for advertising – as good products are sold automatically. During 1940s ‘Product Concept’ was replaced by ‘Sales Concept’ and worked on the belief that sales will not result unless there are promotional efforts – which meant aggressive advertising. This prevailed very strongly up to 1940s, but we do find it in practice even to day. During 1950s, we come across customer orientation concept, where customer is the centre of whole activities of production and marketing. It meant-conduct of marketing research to know customers needs, make available products-promote or advertise them to market effectively. Thus, product came last and customer products-promote or advertise them to market effectively. Thus product came last and customer first. Since 1950s-this is predominant even today. This customer orientations concept has now undergone emerge and still undergoing-which is called as social concept-that cares for consumer welfare and environment protection. These changes took place in 1960, 70s, 80s and 90s. Thus, a person wants can, which is less pollutant, a cigarette without smoke, a medicine without side effect, a product that causes no environmental imbalance.

Q11. Which is the Best Marketing Concept? Ans. From the above, the best concept in integrated concept, which cares for societal

needs using resources hamming none. Features of integrated marketing concept are: (1) Customer-Orientation (2) Customer satisfaction and delight (3) Integrated managerial actions (4) Realization of organizational goal.

Section-B 2 Marks Questions [Question 1 to 20] Page [12 to 14]

Q1. What is Product differentiation? Ans. Differentiation of physical product in the act of designing a set of meaningful

difference in the product distinguishes the Co’s offering from Competitor’s performance features, reparability, reliability etc. So this is how one product is differentiated from other.

Q2. What is Product life Cycle? Ans. Product life Cycle is used to analyze a product category a product formula

product, or a brand. e.g. our product a brand is (smirn off). It provides insights into a products life cycle competitive dynamics. Products life cycle.

Q3. What is Market segmentation? Ans. Market segmentation identifies and profile distinct groups of buyers who might

require separate products and / or marketing mix. It has four levels. 1) Individual marketing 2) Segment Marketing 3) Local marketing 4) Niche Marketing.

Q4. What is Consumer Adoption Process? Ans. Consumer Adoption Process is used to build an effective strategy for early market

penetration on. Adoption is an individual & decision to become a regular user of the product. Stage in the adoption process. Adopters of new products have been observed to move through following five stages.

1) Awareness 2) Interest 3) Evaluation 4) Trial


5) Adoption Q5. Which factors influence the consumer adoption process? Ans. Factor influencing the adoption process

1) People differ markedly in their readiness to try new product. 2) Personal Influence 3) Characteristic of Innovation

Q6. Marketing Intelligence System. Ans. Marketing Intelligence System is a set of producers and sources used by manager to

obtain their everyday information about pertinent developments in the market environment. The internal record system supplied result data; the marketing intelligence system supplied happening data.

Q7. Target market. (Served market) Ans. Target Market is the target or is the part of the qualified available market the

company decided to purpose. Like a company decide a concentrate its marketing opportunities to determine total demand.

Q8. Positioning. Ans. Positioning is the act of designing company’s offering and image so that they occupy

a meaningful mind. It means what you position in the mind of the prospect of the product. It focus on how many and which difference to promote to the target customer.

Q9. Market Evolution. Ans. Product life cycle focuses on what is happening to the overall market. It shows

market-oriented picture. It is a broader look at whole market. A firm needs to anticipate a market’s evolutionary path as it is affected by new need, competitor’s technology, channels and other development. It has technology channels and other development. It has four staged: 1) Emergence 2) Growth 3) Maturity 4) Decline.

Q10. Niche Marketing. Ans. A niche is more narrowly defined group, typically a small group whose needs are not

being well served. Marketers usually identify which by dividing a segment into sub segments or by defining a group with a distinctive set of traits who may seek a special combination of benefits. Niche typically attracts smaller companies. The customer in the niche has a distinct and complete set of needs e.g. smoker can be further segmented into occasional smoker regular smoker etc.

Q11. Sales forecasting. Ans. Sales forecasting is the expected level of company sales based on a chosen

marketing plan and an assumed marketing environment. Sales forecasting is the result of an assumed marketing expenditure plan. Sales forecasting are based on estimate of demand. This demand is analyzed by market demand. Sales forecasting are used by financial department to take decision about needed cash & investment decision about output level, manufacturing or purchasing of right quantity of material.

Q12. Consumer Behavior. Ans. Consumer behavior studies how individual, group and organization select but use

and dispose of goods, services, ideas or experience to satisfy their needs and desires. OR we can say “knowing consumer” marketer must target customers’ want, perception, preferences, shopping and buying behaviors. There is lots of factors influence consumers behavior. – Cultural factor, social factor, personal factors Psychological factor etc.


Q13. Distinguish between product image and brand image. Ans. Difference between product and brand image is as follow:

Product Image Brand image

P.I. is the particular picture that is the set of beliefs Consumer acquire of an actual or about a brand make Potential products. This image is up is called brand Based on the characteristics of the images. Means where Product like size, use etc. The brand stands on

Each attribute like Image of brand Image belongs to the company image.

Q14. Convenience goods. Ans. Convenience goods are that the customers usually purchases frequently,

immediately, and with a minimum of efforts. Example includes tobacco products, soaps & newspaper. These can be further divided into

a) Impulse goods: Purchased on impulse, without any planning and efforts.

Usually displayed widely. b) Emergency goods: When need is urgent like umbrellas in rainy season. c) Staples: Consumer purchase on regular basis, like of toothpaste etc.

Q15. Marketing decision support system. (MDSS). Ans. Marketing decision support system. (MDSS) is that which co-ordinates collection of

data, systems, tools & techniques with supporting software and hardware by which an organization gathers and interprets relevant information from business and environment and turns it into a basis for marketing action.

Q16. Customer value and satisfaction. Ans. Customer value and satisfaction. Value is the customer estimate of the product’s

overall capacity to satisfy his or her needs. Where as satisfaction is the fulfillment of customer requirement at the lowest possible cost of acquisition, ownership & use of the product good value then only it can satisfy customer’s need.

Q17. Marketing information system (MIS). Ans. Marketing information system (MIS) consists of people, equipment and procedure to

gather, sort analyze, evaluate and distribute needed, timely and accurate information to marketing decision maker, In each & every organization firms must organize the flow of marketing information to its marketing managers to fulfill their information need. The role of MIS is to assess the manager’s information need and supply information timely to take decision.

Q18. What is diffusion process? Ans. The social process of spreading information about new products and services to

persuade consumer to accept them is known, as “diffusion” Diffusion processes is slow business process and entire process takes several years. It is important to identify target segments at each stage in the diffusion process.

Q19. Discuss the kind of customers present in a market. Ans. A market involves following kind of customers:

1) Innovator: youngest people have the social status & wealth. 2) Early adaptor: Generally influential i.e. leader. They have high status within

own social group.


3) Early majority: Most deliberate – not consider buying a new product until a number of their peer have done so.

4) Late Majority: Person who have below average income and social prestige and older than members of earlier groups.

5) Laggards: They have still lower income & social status they are the last over the adopt a new products by the time they but a new product.

Q20. Trademarks. Ans. Trade marks- when the brand mark is registered and legalized it becomes a

trademark. In that sense all trademarks are brands but all brands are not trademarks.

Definition “Brand or part of a brand that is given legal protection because it is a

capable of exclusive appropriation.”

Thus trademark is essential a legal term protecting the manufacture’s right to use the brand name or trademark.


Section-B 5 Marks Questions [Question 1 to 11] Page [15 to 23]

Q1. What is STP? Ans. STP means

S Segmentation T Targeting P Positioning

Market Segmentation: Whenever a market for a product or services consists of two or more buyers, the market is capable of being segmented this divided into meaningful buyer groups. The purpose of segmentation is to determine difference among buyer, which may be consequential in choosing away them or marketing to them.

Targeting: When the market is segmented than targeting starts. After various segments of the markets are evaluated. So we can say targeting means to evaluate the attractiveness of each segment so that sales can be increased.

Market positioning: To identify possible positioning concepts for each target segment & to select, develop & communicate the chosen positioning concept.

Q2. What is the different basis of segmentation? Ans. Following are the different basis of segmentation:

1) Geographic segmentation: Calls for dividing the market into different geographical units such as nations, states, regions, counties, cities or neighborhoods.

2) Socio/ Economic Factor: Demographic Segmentation: The market is divided in to groups on the basis of demographic variables such as age, family, life cycle, gender, income, occupation, education, religion, family, size nationality or social class.

3) Psychographics Segmentation: Buyers are divided into different groups on the basis of life style and /or personality. People in the same demographic group can exhibit vary different psychographics profiles.

4) Behavioral Segmentation: Buyers are divided into group on the basis of their knowledge of attitude toward use of or response to a product. Many marketers believe that behavioral variable – occasions, benefits, usage rate, loyalty stages, buyer readiness stage & attitude are the best starting points for constructing market segments.

Q3. What are the different features of product differentiation? Ans. Differentiation features of the product differentiate the product from another product.

Today is the day of change. But before deciding about the differentiation company must decide whether to offer features customization to customer at a higher cost or more standardization to customers at lower cost. Following are the different feature for product differentiation.


1) Performance Quality: refers to the level at which the product's primary characteristics operate. The manufacturer must design a performance level appropriate to the target market and competitor's performance level. Performance quality can be determined through profitability, time utilization cost etc.

2) Conformance Quality: is the degree of which all the produced units are identical meeting the promised target specification. Low conformance means when product will fail to deliver its promise.

3) Durability: is the measure of the product expected operating life under natural and stressful conditions? Basically customer feels if they pay more for products they have more durability. But is not purely true. No technological obsolescence is three if price are less.

4) Reliability: is the measure of the probability that a product will not malfunction or fail within a specified time period.

5) Reparability: is the measure of the case of fixing a product that malfunctions or fails. This features support the customer decision to purchase.

6) Style: Describe the product 's book & feel to the buyer like packaging, accessories etc.

7) Design: The totality of features that affect how a product looks & functions in term of customer requirement so these are the features of the product differentiation.

Q4. What is consumer Adoption process? Ans. Consumer adoption process is a process in which potential customers learn about

new product and to make an individual try them & adopt them is decision to become a regular user of the product. This process is later on followed by consumer loyalty. Process. Following are the various stages in Consumer adoption process The consumer adoption process on the mental process through which an individual passes the first hearing about an innovation to final adoption. Adopter of new products has been observed to move through the following five stages in consumer adoption process. The consumer adoption process focuses on the mental process through which an individual passes from the first hearing about an innovation to final adoption. Adopter of new products has observed to move through the following five stages. 1) Awareness: The consumer becomes aware of the innovation but lacks

information about it.

2) Interest: The consumer is stimulated seek inf. about the information.

3) Evaluation: The consumer considers whether to try the innovation.


4) Trial: The consumer tries the innovation to improve his or her estimate of its value.

5) Adoption: The consumer decides the make full & regular use of the innovation.

This progression suggests that the new product marketer should aim to facilitate consumer movement through these stages. The manufacturer should consider offering a trial use plan with option to buy. So this is brief view of consumer adoption process.

Q5. What is the process of new product development? Explain various steps in

detail. Ans. Basically there are eight stages involved in development of new product, which are

as follows: Idea Generation: The process starts with the search of ideas. Top management should define the product and market to emphasize and should state the new products Objective, Idea can come from various sources customer, scientists, employees, competitors, channel member & top mgt. This step emphasis on customer needs & wants. This step can take place through attribute listening forces relationship, morphological, analysis, Brainstorming etc. Idea Screening: Any company can attract good ideas by organizing itself properly. The co. should motivate its employees to submit their idea to an idea chairman then this idea should be stored in three groups. Promising ideas, marginal ideas & rejects. In screening ideas company must avoid two types of error. A drop error –when co dismissed otherwise good ideas. Second is a Go error when the co. permits poor ideas to move into development and commercialization. In it product ideas rating devices are also used.

Concept Development and Testing: For developing a good product we must have product ideas, product concept product image. The entire like product positioning map, brand positioning map etc. help in concept development. Where as concept testing calls for testing product concept with an appropriate group of target consumers, then getting those consumer's reaction 4) Marketing Strategy Development: After testing the new product manger must develop a preliminary marketing strategy plan for introducing the new production into the market. Marketing strategy plan consists of three parts. Acc. to first plan –target market size, structure & behavior etc should be described acc. to second plan. M.S outlines product's planned process Acc. To third plan describes the ling run sales & profit goals & marketing mix strategy over time. 6) Business Analysis: After mgt. develops the product concept and marketing

strategy, it can evaluate the proposal’s business attractiveness. Mgt needs to prepare sales, cost & profit projects to determine whether they satisfy the companies objective. In it mgt. have to decide about estimating total sales. Estimating costs & profits.

7) Product development: R&D department will develop one or more physical version of the product concept .Its goals is to find a prototype that the consumers see as embodying the key attribute described in the product concept statement that perform safely under normal use & manufacturing costs.


8) Market Testing: Have product sales met our expectation? Whether the marketing test is under control.

9) Commercialization: Are product sales meeting our expectation? If the company

goes ahead with commercialization, it will face its targets costs to date. It include (When, where, to whom, how) answer of all the question relating to launching of product.

Q6. Explain the term positioning. Ans. Positioning:

It the act for designing the company's offering and image so that they occupy a meaningful and distinct competitive position in the target customer's minds. Positioning is what you do to the mind of the prospect. Each firm when want to promote difference then that firm appeal most strongly to its that firm to different it self with another company. Like Auto Company might choose to differentiate its cars on during durability while its competitor choose to emphasize fuel economy, comfort or smoothers of ride. Here the end result of positioning the successful creation of a market focused value proposition.

Q7. Write short not on packaging, labeling Ans. Packaging:

Packaging includes the activities designing and producing the container or wrapper for a product. The container or wrapper has become a potent marketing tool. Well-designed package can create convenience value for the consumer and promotion value for the producer.

i. Primary package: Like old spice after-shave lotion in a bottle that is in a cardboard box.

ii. Secondary package: That is in a corrugated box like shipping packages containing six dozed boxes of old spice.

Labeling:

Labeling is subset of packaging. Label may be a simple tag attached to the product or elaborately designed graphic that is the part of the packaging. Label might carry only the brand name, which help in identification of the product. The label might help in identification of the product. The label might help in identification of the product. The brand name which help in identification of the product. The label might describe the product, which made it, where it was made, when it was made it was made, what it contains, how it is to be used and how to use it safely. Finally the label might promote its product through attractive graphic.

Q8. What is branding? What are the branding strategies and its benefits? Ans. Branding: Manufacturer who decides to brand their product must choose which brand

name to use. Brands can be given with any of the four strategies.

1. Individual brand name 2. Blanket family name for all products 3. Separate family name for all products. 4. Company trade name combined with individual product name

Some points should be remembered before allocating brand name to the product.

1) It should suggest something about the product's benefit.


2) It should suggest product, qualities such as action or color. 3) It should be easy to pronounce, recognize and remember. 4) It should be distinctive. 5) It should not carry poor meaning in other countries & language.

Brand Strategy Decision: A company has five choices when it comes to brand strategy.

1) Line extension: existing brand name extended to new size of flavor and soon.

2) Brand extension: Brand name extended to the new product categories

3) Multi-brands: New brands introduced in the same product category.

4) New brands: New brands names for a new category product. 5) Co- brands: brands bearing two or more well-known brand names.

Q9. What are the phases or stages of consumer adoption process? Ans. Once a product is introduced in the market, the major challenge rests with the

marketing function. The product so introduced is to be ‘adopted’ i.e., purchased and diffused i.e., percolated through out the markets. Adoption is the decision of an individual to use the product.

Stages in Adoption Process

The adoption process is believed to follow a five stage sequential process beginning with actual awareness of a product’s existence and ending with adoption or commitment to the product. From the point in time when an individual first hears of an innovation to the point in time when adoption occurs has been recognized as consisting of five logical stages namely, awareness – interest-evaluation-trial and adoption.

1. Awareness Stage: - Here the individual is exposed to the innovation but lacks

complete information about it. That is, the individual is aware of the innovation but is not yet motivated to seek further information. He knows of product existence.

2. Interest stage: - The individual becomes interested in the new idea and seeks

additional information about it. The innovation is favored in a general way but is not yet judged in terms of its utility to a specific situation. He seeks further information.

3. Evaluation stage: The individual applies his mental faculty to the innovation to

compare present and anticipated situation and then decides to whether or not to try it. It is to do with careful weighting as to whether or not to try it.

4. Trial stage: -The individual uses the innovation uses the innovation on a

small-scale in order to determine its utility in his own situation. That is he tries it one or twice to confirm it’s utility.

5. Adoption stage: - The individual decides to continue the full use of the

innovation. That is he purchases and repurchases.

It is worth emphasizing here that any innovation may be rejected at any stage of adoption process. Even rejection can take place after adoption, which is called as


discontinuance. Further, a consumer may move through several of these stages simultaneously as it happens in case of impulse buying.

Q10. Explain the process of new product development. Ans. Steps followed in the process of new product development are:

1. Idea generation

Product idea generation means fusion of perceived need with the recognition of a technical opportunity.

The Sources of new product ideas: - These sources are internal and external: The internal sources are:

1. Basic research 2. Manufacturing 3. Sales people. 4. Top management.

The external sources are: 1) Secondary source of information. 2) Competitors. 3) Customers. 4) Resellers. 5) Foreign marketing. 6) Inventors

Methods or techniques of getting new ideas. The most reliable method is:

1. Focus groups. 2. Attribute listing. 3. Forced relationships. 4. Brain storming 5. Reverse brainstorming. 6. Problem inventory analysis.

2. Screening new product ideas

New product idea screening is the development and use of criteria to evaluate the potential of new product ideas. It is that process whereby ideas from the new product pool have to be screened to find those that are worthy of continued development and evaluation. Reasons for cutting the ideas: - Good many ideas are cut because of:

1. All good ideas are not equally promising. 2. Resource constraints. 3. Product development is a continuous process.

The Screening procedure

The procedure involves two steps. The first task is to determine whether a given product is compatible with the company objectives. The second task is to determine whether the new product idea is compatible with the company’s resources. The screening methods: - There are two most commonly used methods used for screening the new product ideas namely, 1. check-list method and 2. Idea rating method.


Avoid mistakes in screening: - There can be two types of mistakes likely to be ignored which will prove fatal to the company. These are, ‘go’ and ‘drop’ errors.

3. Business analysis

It is an in-depth study of the estimated economic feasibility of new product ideas. It is an attempt to predict the economic consequences of the product for the company as a whole. Steps in business analysis. Three steps are involved in business analysis namely, demand analysis, cost analysis and profitability analysis. The profitability analysis is done through four analyses namely, break even, rate of return, payout and discounted cash-flow. Finally the results are presented in the form of Business Analysis Chart.

4. Product development

Product development stage marks the making up of actual prototype of the product and tested, and refined and marketing campaign is planned. It is a scientific and engineering task leading to the design and building of prote-type, working models on one hand and functional testing on the other. This stage is important because:

1. It gives a concrete form. 2. It speaks of investment. 3. It provides definite answer.

Aspects of product development There are two aspects namely technical development and market development. Technical development is the job of engineers and technicians and is to do with two dimensions namely, applied engineering research and manufacturing research. Market development aspect is concerned with testing the product by marketing experts and involves two tests, namely, product concept testing and developing other aspects of marketing-mix. The first deals with concept and preference testing. The second part deals with product branding, product packing, product labeling, product patenting and product communication programme.

5. Test-marketing

It is the controlled experiment done in a limited but carefully selected part of the market place whose aim is to predict the sales or profit consequences, either in absolute or relative terms of one or more proposed marketing actions. Why test-marketing? Test marketing is undertaken because of:

1. Improving the knowledge of product sales. 2. Pretesting alternative marketing plans. 3. Predicting product faults. 4. Knowing reactions of competitors.

The problems in test-marketing. The basic problems of test marketing are: Inaccurate results.

1. It is an expensive exercise. 2. It is time consuming affair. 3. It lets the tips to competitors.


Essentials of sound test-marketing The essentials of test-marketing worth calling as sound are: -

1. Representative test market 2. Perfect projection of results. 3. Demographic validation. 4. Competitive validation. 5. Behavioral validation. 6. Strategy validation.

How test marketing is conducted?

Either it is done by the firm or is managed by advertising agencies. In either case, the test marketing plan covers the points namely, number of selected cities, length of test run, the information to be collected and the action to be taken.

Alternatives to test-marketing The alternatives to this technique of test-marketing are:

1. Markov chain analysis. 2. Model test-marketing. 3. Market simulation model. 4. Roll-out method.

6. Commercialization

It is the actual introduction of the product into the market place, with all of the related decisions and resource commitments. It is the stage whereby contracts are entered into for the supply of raw materials and components parts, channels of distribution are selected, manufacturing facilities and equipments are set in operation, sales people are hired and advertising programmes are okayed. This involves two important decisions as to entire market versus selected segment and crash versus rollout introduction. These decisions are of vital importance as they involve heaviest investment and efforts.

Q11. What are the essentials of a good brand name? Ans. Following factors make a brand name good one:

1. It must be Easy to Pronounce and Remember: For instance, “HOECHEST” is difficult to pronounce. On the other hand, “Murphy Baby” and ‘Click’ are fine example.

2. It should be Short and Sweet: The name must e short yet sweet, appealing to

eyes, ears and brain. Mukund and Mukund, Panama, D.C.M., Bombay Dyeing, Bata, Tata, etc, are of such kind.

3. It Should Point out Producer: The name or symbol should be given

connotation of the product, producers, etc. The best examples are NELCO, MICO, LT. AMUL, and B.T. INDAL etc.

4. It should be Legally Protectable: The brand name must lend them for legal

protection. A brand name, legally recognized, is known as trademark. Normally, it depends on the will and discretion of a producer, middlemen than on brand name.


5. It should be Original: The brand name selected must not be general be specific. It must be such that others do not easily copy it. Hardly one finds the use of brand “Philips” by imitators. On the other hand, “Gluco” and “Glucose” biscuits are different. There is difference in “Upkar and “Upchar” Supari. But for a common man, it is more difficult to identify and differentiate.

6. It Should Reflect production Dimensions: A good brand name is one which

reflects directly or indirectly some dimensions say product benefit, function, results and so on. For instance EZEE of Godrej Company is really easy to use for better results; another brand GOOD-NIGHT of a mosquito replant pad implies the user says ‘god-night’ to mosquitoes as he is going have good and sound sleep at least eight-hours. PUMA brand shoes are the symbol of speed as panther is shown.


Section - C 2 Marks Questions [Question 1 to 26] Page [24 to 27]

Q1. What is Sales Promotion? Ans. Sales Promotion: is a total used to create stronger & quicker sales. If effects are

usually in short run because in long run only brands are preferred. Three benefits can be diverse which is sale promotion. 1) Communication 2) Incentive 3) Invitation

Q2. What is Advertising? Ans. Advertising: - It is used to build a long-term image for a product and to trigger quick

sales. It is one of source to make aware people about product. There are various/source to make aware people about product 1) Newspaper 2) TC 3) Radio 4) Pamphlets etc.

Q3. What is Online Marketing? Ans. On line marketing: It is channels of marketing through which a person can reach via

computer & modem. Through this channel information services are provided to consumer, which are interested in on line dealing. This can be done by placing Ads, using, E-mail, creating an electronic storefront. participating in newsgroup and bulletin etc. It is most convenient method of marketing to the on line user.

Q4 What is Publicity? Ans. Publicity: It is program design to promote company is image or its products. It is

basically used for launching new products, repositioning a mature product, building interest in product, repositioning a mature product, building in a way that project favorably on its products. About the Co & its product.

Q5. What is Personal Selling? Ans. It the most cost effective tool at later stage of the buying process, particularly in

building up buyer’s preference, conviction and action. It is an ancient art analysis and customer management. It is method of the method to effect sales.

Q6. What is Market Demand? Ans. M.D. for a product is the total volume that would be bought by a defined customer

group in a defined geographical area in a defined time period in a defined market environment under a defined marketing program for this we have to estimate marketing opportunities to determine total demand.

Q7. What is Communication Process? Ans. Communication Process

1. Identify the target audience. 2. Determine the communication objectives. 3. Design the message. 4. Select the communication channel 5. Establish the total promotion budget. 6. Decide on promotion mix 7. Measure the promotion’s result. 8. Manage and co-ordinate the integrated marketing communication.

Q8. What is Personal Interview? Ans. It is most versatile of the other method of interviewing. In this type of interview

interviewer can ask more questions and can recorded additional observation about the respondent. Both the parties face each other. This is the best way of


communications. But it is the most expensive method and requires more administrative distortion. There are also some chances of biasness or distortion. It can be of two forms:

1) Arranged Interview 2) Intercept Interview

Q9. What is Sampling? Ans. When population is not observed for research purchase only selected person is used

for the purpose. Then that method is known as sampling. The marketing researchers must design a sampling plan. In which he has to take three decisions.

1) Sampling Unit: Who is to survey? 2) Sampling Size: How many people should be surveyed? 3) Sampling procedure: How should the respondent be chosen.

Q10. How sampling can be done? Ans. Sampling can be done in following three forms

a) Simple random sample: Every member has equal chances of

selection. b) Stratified Random sample: Population is divided into group, then

Random sample are drawn from that group. c) Cluster (area) sample: Prescribed number of people in each of several

categories. Q11. What is Customer Database marketing? Ans. Customer database marketing is the process of building, maintaining and using

customer database and other databases marketing is the process of building, maintaining and using customer database and other data bases (product supplied resellers) for the purpose of containing and transacting, A customer database is an organized collection of comprehensive data about individual customer or prospects that is current accessible and actionable for marketing purpose as legal generation, sale of product or services or maintenance of customer relationship. In it information like (age, income, family members, birthday, activities etc.

Q12. What are Public Relations? Ans. Involves a variety of programs designed to promote and to Product Company’s

image or its individual process. It is an important marketing too. Most companies operate PR department to plan these relations.

Q13. What are the activities performed by public relations department? Ans. Public Relations department performs following five activities:

1) Press relations 2) Product publicity 3) Corporate communication 4) Lobbying: dealing with legislation and government officials to promote

or defeat legislation and regulation. 5) Counseling: Advising management about public issues and company

positions and image.


Q14. What are the marketing channels? Ans. Marketing Channels / Trace Channels/ distribution Channels: are set of

interdependent organization involved in the process of making a product or services available for use or consumption. For marketing the product in the market the producer work with making a product or service available for use or consumption. For marketing the product in the market the producer work with marketing intermediaries. The marketing intermediaries use marketing channels.

Q15. What is promotion budget? Ans. Promotion Budget: Promotion budget is the budget in which the company has to take

marketing decision budget. Different marketing activities are allocated funds. Q16. What are the different methods of budgeting? Ans. Different methods of budgeting are:

1) Affordable method: Here promotion budget set at what they think company

can afford. They don’t think about requirement. 2) Percentage of sales Method In it promotion expenditure vary with sales.

Encourage competitive atmosphere. 3) Competitive parity Method: Promotion budget is set up on the behavior of the

competitor’s achievement. 4) Objective and Task Method: Calls upon marketers to develop their promotion

budget by defining their specific objective, determining the tasks that must be performed to achieve these objectives, and estimating the cost of performing these tasks.

Q17. What is super marketing? Ans. Super Marketing: Super Markets remain the most frequent shopped type of retails

store. Super markets earn operating profits of only about 1% on their sales and 10% on their net worth. It is relatively large, low cost, low margin, high volume, self service operations designed to serve the consumer’s total need for food, laundry and households maintenance products Despite of strong competitors from new & innovative competitors like superstore & discount stores, supermarket are the best.

Q18. What is test marketing? Ans. Test marketing: is the ultimate way of testing a new consumer product. It helps the

company to sell the product and giving the exposure to the product. In deciding to do the test marketing, mgt faces several questions like.

1. How many cities to be test. 2. Length of the test? 3. Information regarding value & cost of product? 4. After answering above questions, what action to take.

Q19. What is service marketing? Ans. Service marketing: As the name suggest marketing of the services provided by the

organization during old time there was no need of services marketing. But now a day it is very popular concept in services business like courier services, educational institution, doctors etc. Three Ps involved in service marketing are people, physical evidence and process.


Q20. What are the types of Service marketing? Ans. There are three type of marketing in service marketing.

1) Internal marketing: Include work done by the co. to train and motivate its employee to serve customer well.

2) External marketing: Work done by the company to prepare, price, distribute & promote the service to customer.

3) Interactive marketing: describe employees’ skill in serving client like technical and functional quality.

Q21. What is Sales force compensation? Ans. To attract top quality sales representative, the co. has to develop an attractive

compensation package. Like extra rewards for average performance. In fair components of its sale force compensation. 1) A fixed amount 2) Variable 3) Expenses allowance 4) Benefits All these components innovates S.R. to improve sales. That is why this compensation is called sales force compensation.

Q22. What is Bonded warehouse? Ans. These warehouse are located near ports. They enable the unloading of commodities

from the ship safety into a place until the owner of the goods takes delivery of them. Such warehouses are necessary for outward transportation since a manufacturer cannot wait until a ship reaches at port of loading.

Q23. What is Co-operative marketing? Ans. Where marketing function like assembling, purchasing, grading, standardizing

financing, risk taking advertising & sale promotion are performed by a cooperative society for its members who themselves voluntary associate together on the basis of equality may be called co-operative marketing. The main purposes of such type of marketing organize is to eliminate the middleman who claim the lion share in their produce.

Q24. What is Cost orientated marketing? Ans. Marketing cost is taken in to consideration for maintaining it. If no. Cost is taken in to

mind then there is not use of that very marketing. Like if the cost of the product is Rs. 15 and market price is 12 then it is totally irrelevant i.e. marketing should be cost oriented.

Q25. What is Stakeholder? Ans. Traditionally most business paid greatest attention to their stockholder. Today’s

business, however are increasingly recognizing that unless they nourish other stockholder- customers, employees, suppliers, distributors, stakeholder are satisfied by company. There is a today dynamic relationship connecting the stockholder group. Al last we can say stockholder are the parties other than real owner (Stockholder) like customer employees, supplier, distributors etc.

Q26. What is Strategic Business Unit (SBU)? Ans. In this one particular single unit of the business can planned separately rather than

the rest of the co. In this business units consider their own set of competitors. In these units they have own manager who is responsible for strategic planning & profit performance & who controls most of the factor affecting profit.


Section-C 5 Marks Questions [Question 1 to 10] Page [28 to 36]

Q1. What is the different type of marketing of channel? What is marketing channel? Ans. Marketing channels: are set of interdependent organization involved in the process of

making a product or service available for use or consumption. As we all know most producers work with marketing intermediaries to bring their product to market. The marketing intermediaries make up a marketing intermediaries make up a marketing channel. Which are also known as trade as channel or distribution channel. Different Channels of Distribution as follows: Channels are a pipeline for goods from the manufacturer to the consumers. Different channels may be used for

i) Consumer goods ii) Agricultural product iii) Industrial product

A) Channel to distribution for consumer goods a) Agency: Stands between manufacturer and the wholesaler. In this channel there are brokers, the manufacturer agent. The commission merchants and the export merchants. Usually the manufacturer uses this channel when he cannot afford to invest the amount required to develop a sales force of his town. b) Wholesaler: Sells goods to the retailer. It is traditional channel. Wholesaler buy the large quantities from the producer & sells it to a number of retail buyer. He is a merchant middleman. He tries to sell more than he pays the difference is known as gross profit. Detect is producer has no link with retainer. Retailer: Here the manufacturer assumes the function of the brokers and wholesalers. This requires an efficient sale force. The channel tries to eliminate wholesaler from the channel of distribution. c) Direct Selling to customer: This method is most common in industrial marketing where capital goods are marketed. Direct sale is also undertaken in the case of agriculture commodities especially in the case of production.

Q2. What are the different steps of channel management decision? Ans. After the co. has chosen a best channel from various alternative steps should be

taken for channel management decision. There are 1) Selecting channel members 2) Motivating Channel members 3) Evaluciting channel members 4) Modifying channel arrangements 1) Selecting Channel Members: Producers vary in their ability to attract qualified intermediaries within the chosen channel. Some producer has no trouble-recruiting intermediaries. In some cases, the promise of exclusive or selective distribution will draw a sufficient number of applications. Here the question comes that whether the producer find it easy or difficult to recruit intermediaries, they should at least determine what characteristics distinguish the better intermediaries

2) Motivating: Channels members: Intermediaries must be continuously motivated to do their best job. Stimulating channel members to top performance must starts with understanding to their need & wants. Intermediaries can aim for relationship based on co-operation, partnership or distribution programming. Most producer see the main challenges as that of gaining intermediaries cooperation .To do so, they often


use positive motivators such as higher margin, special deal premiums, co-operative advertising allowances, display allowances & sale contests.

3) Evaluating channel members: The producer must periodically evaluate intermediaries performance against such standard as sales quota attainments average inventory level, customer delivery time, treatment of damages and lost goods & co operation in promotional & training programs, underperformers need to be counseled, restrained or remotivated.

4) Modifying channel arrangements: A producer must do more than design a good channel set it into motion. The system will require periodic modification to meet new conditions in the market place. Modification becomes necessary when the original distribution channel is not working as planned, consumer buying patterns change, the market expands, new competition arises, innovation distribution channel emerge & the product moves into the latter stage & the product move into the later stage in the product life cycle.

Q3. What are the different steps in managing the sales force? Ans. Difference steps in managing the sales force are as follows

1) Recruiting and selecting sales representative: First of all selection of effective sales representative. Select those S.R. which are honest reliable, knowledgeable and helpful because customer look for these traits in the sales, representative.

2) Training sales Representative: Many companies send their new sales representative into to field, which makes their selling ineffective. So the S.R. should be properly brained. Customer expects sale people to have deep knowledge of product to add ideas to improve the customer operations and to be efficient and reliable. These demands have required companies to make too much higher investments in sale training. In training sales representative much be made aware of following points. i) Sale representative need to know and identify with the company. ii) Sales representative need to know the customer and competitors. iii) Sales representative need to make effective dales presentation. iv) Sales representative need to know understand filed procedure &

responsibilities. v) Sales representative need to know company's product.

3) Supervising sales representative: Sales representative who are paid mostly on commission generally receive less supervision. But those who are salaried must cover definite accounts are likely to receive substantial supervision. 1) Developing norms for customer calls. 2) Developing norms for prospect calls. 3) Using sales time efficiently 4) Motivation sales Representative: Some S.R. will put forth their best effort

without any special coaching from management to them selling is the most fascinating job in the world. They are ambitious self-starters. But majority require motivation, encouragement for increasing sales. Churchill, Ford & Walker, studies this problem. They follow this model

Motivation Effort Performance Reward satisfaction

This model implies the following: 1) Sales manager must be able to convince salespeople that they can sell more by

working border or by being training to work smarter. 2) Sales manager must be able to convince the sale people that the reward for

better performance is worth the extra efforts.


3) For motivation org. can use foll. Strategies 4) Sale quotes 5) Supplementary motivation like sale meeting, sale contests. 6) Evaluating sales representative: Under this we study the management

communicates what the sale representative & be doing. This evaluation can be done through various sources like what are S.Rs marketing plan etc. Formally we can evaluate S.R. by customer satisfaction evaluation, qualitative evaluation of sales representative & current to past sale comparison etc.

Q4. What the different form of promotion mix? Ans. It includes all the activities the company undertakes to communicate and promote its

product to the target. It has to set up communication & promotion programs consisting of adverting, sale promotion public relations and direct and online marketing. Different forms of promotion mix include 1) Public Relation and Publicity: This is based on their three distinctive qualities.

a) High credibility b) Ability to catch buyer off guards c) Realizations

2) Personal Selling: It is the most cost effective form of it at later stage of the buying process. It has three distinctive benefits.

a) Personal confrontation b) Cultivation c) Response

3) Direct Marketing: Like direct nails, telemarketing, electronic marketing etc. It has four distinctive characteristics.

a) Non-public: Message normally addressed to a specific person. b) Customized c) Up to date d) Interactive These all the method of promotion mix

These all are the methods of promotion mix. Q5. Write a short note on Retailing, whole selling and distribution? Ans. Retailing:

Retailing includes all the activities involved in selling goods and services directly to final consumers for their personal non business user, Retailer can be classified I terms of 1) Store Retailing 2) Non store retailing 3) Retail organization 1) Store Retailing: Like departmental stores, customer today can shop for goods &

service in a wide variety. 2) Non-store retailing: Like direct selling, direct marketing, buying services, mail

order shopping, TV shopping. 3) Retail organization: achieve many economics of scale, such as greater

purchasing power, wide brand reorganization, example of these type of shores are consumer co-operative, franchise.

Whole Selling:

Whole Selling include al the activities involved in selling goods or services to those who buy for resale or business use. Wholesaling exclude manufacturer and farmers because they are engaged primarily in produce wholesaler is different from retailer, whole seller pay less attention to promotion, atmosphere location etc. Type of whole selling 1) Merchant whole seller 2) Brokers and agent


3) Manufacturer and retailer 4) Branches and offices. 5) Miscellaneous wholesaler Distribution:

For distribution the goods & services in the market companies have to decide on the number of intermediaries to use at each channel level Basically 1) Exclusive Distribution 2) Selective Distribution 3) Intensive Distribution methods are used like 1) Exclusive distribution: Involves limiting the number of intermediaries handling the

company's goods services. 2) Selective Distribution: Involves the use of more than a few but less than all the

intermediaries who are willing to carry a particular product. 3) Intensive Distribution: The manufacturer places the goods and services in as

many outlets as possible. When the consumer require a great deal of location convenience, it is important to offer greater intensify of distribution. At last we can say distribution is channel of delivering goods from product to consumer

Q6. Who is wholesaler? Which functions does he perform? Ans. WHOLESELERS:

Wholesaler traders are one who sales to other middlemen, institutions and individuals usually in fairly large quantities. According to American Management Association, “wholesalers sell to retailers or other merchants and/or individual, institutional and commercial users but they do not sell in significant amounts to ultimate consumers”. Thus, wholesale trade is to do with marketing and selling merchandise to retailers, to other wholesalers or to individuals-commercial and professional or other institutional users in contrast to household consumers, to individuals for personal use or to the farmers.

Functions:

Wholesaler traders perform a number of functions in the process of marketing the goods. Of them, the most important ones are:

1. Assembling and Buying: Assembling implies the collection of small lot of

scattered agricultural production for economic bulk buying; it also means bringing to-gather stocks of different manufactures and placing orders on them and making special purchases in cases of seasonal products.

2. Warehousing: Warehousing or storing is closely related to the function of assembling. As there is always a gap between the time periods of production and consumption, they are to be held and preserved. This involves capital lock-up plus risks. This warehousing by wholesalers relieves both the producers and the retailers from the problems of storage.

3. Transporting: In the processes of assembling and warehousing and resale, wholesalers do undertake transportation of goods from producers to their warehouses and back to the retailers. What is important is that this transportation is done on most economic lines, either through their own fleet or through hired common carriers.

4. Financing: Wholesalers undertake marketing financing. They grant credit on liberal terms to retailers on one hand and reduce the financial burden of the manufacturers by taking early delivery of stocks from them. The very fact that the wholesalers grant credit is as good as reducing the credit quota of manufacturers to final users.

5. Risk Bearing: Risks are inherent in business, which is to be borne and shifted. Wholesalers bear the risks of loss of change in prices, of damage, deterioration in quality, pilferage, theft, fire and the like of goods held in


storage. They also bear risks of non-or under payment by the retailers. Risk shouldering is the part of his game.

6. Grading, Packing and Packaging: Grading is another function of wholesalers where by they sort-out the stocks in terms of differing sizes, qualities, moisture contents and so on. Bulk breaking is done with a view to meet the small lot requirement of the retailers. In fact, they repack for the consumers as per the orders of the retailers.

7. Dispersing and Selling: The goods assembled and held in stock are meant for dispersing and selling. It is the retailers who buy from the wholesalers. Similarly, wholesalers do have their own sales-army moving to retailers in collecting order.

8. Providing Market Information: Wholesalers are the vital link between the retailers and the manufacturers. They provide relevant and up-to-date information to the retailers affecting their trade interests; so also they reciprocate the same to manufacturers as to whatever retailers feed them on changing market conditions useful for the wholesalers.

Q7. What kind of services do the wholesalers provide to related parties? Ans. Services provided by the wholesalers:

Wholesalers render some valuable service to both the manufacturers and retailers while performing the above mentioned eight functions. These are:

A. Services to the Manufactures:

1. Economics of Scale: - The wholesalers buy in bulk than in small lots. The bulk

selling for manufacturers brings the benefits of the economics of large-scale production because, bulk selling supports bulk selling supports bulk manufacturing on the part of producers.

2. Saving in Time and Trouble: Wholesalers collect orders from large number of retailers on behalf of the manufacturer and supply them goods in small lots. This relieves the manufacturer from the wastage of his valuable time, trouble and treasure. Thus, he can concentrate on the production problems than distribution.

3. Regularization of Production Cycle: The wholesalers give the actual and potential demand conditions being in close contact with the retailers. Further manufacturers can keep production a continuous activity because the wholesalers act as the safety value to smoothen the seasonal demand and regular supply and vice versa.

4. Better Use of Capital: In absence of wholesalers, every producers or manufacturer would have been forced to maintain huge stocks, which mean capital lock-up, in addition to the risks of loss. Now he is using those funds in production because, the wholesalers have taken the task of stock holding.

5. Price Stabilization: In absence of wholesalers, there would have violet price fluctuation harming the interests of the consumers and the wholesalers. It is the wholesalers who match seasonal demand and supply and regular demand and supply. It reduces the vagaries of extremes, which are deadly.

B. Services to the Retailers:

1. Stock Replenishment: By very nature, the retailers are carrying on wide

variety of goods in small lots to meet varied requirements of consumers. He has neither sufficient space nor finance to do so. It is the wholesalers that help him to have the stocks without commitment to space and finance.

2. Saving in Cost and Time: Retailers save good deal of time and cost by placing orders with the wholesalers than the producers or the manufacturers


directly. In fact, a retailer contracts manufacturers at times through a reliable wholesaler.

3. Economy in Transport and Packing: Retailers get their requirements right at their door-steps at least cost because; wholesalers are the bulk buyers and the movers. Expenses of packing and packaging would have been much higher if done on smaller scale. The greatest advantage is that all the varieties of his choice are available in a single pack or commitment that arises.

4. Better Use of Limited Capital: Retailers replenish stocks as and when they require with the ready stock held by the wholesalers. In absence of wholesalers, retailers would have been forced to hold larger stocks of wide variety of products involving huge capital lock-up and the risk of losses in various forms. These risks are reduced as he holds a small quantity over a period. He gets liberal credit too.

5. Expert Knowledge: Wholesaler being specialized in particular lines, have expert knowledge and experience on changing market conditions. This is passed on to the retailers on which he can capitalize; wholesaler brings to his notice new products, undertakes sales-promotion the advantage of which goes to him in increased sales and profits.

Q8. What are the various types of wholesalers? Ans. The Types of Wholesalers are: Wholesalers are mainly of three types namely,

(1) Full function, (2) Converter and (3) Drop Shipper.

A ‘full-function’ wholesaler is an intermediary who buys and sells the products on his own account, assembles products from different sources in bulk, carries stocks, sells in smaller lots, grants credit and renders valuable counsel and advice. Because of wide range of functions, he performs and service he renders, he is called as full-line wholesaler. A ‘converter’ is that full-line wholesaler who buys products and sells them to the subsequent channel members after processing them. Thus, in cotton textiles, he may convert gray cloth into bleached and dyed, in corns; he may convert wheat into wheat flour of pallets. A ‘drop-shipper’ is that wholesaler who neither stores the products nor delivers them to the buyers from his own stock but books orders and directs manufacturers to the retailers to those effects. However, he has to take delivery of goods in case the retailer or the buyer fails to accept the same.

Q9. What are the various types of retailers? Ans. The Types of Retailers are:

The retailers can be classified in number of ways. However, the most practical and popular way is that of small scale and large retailers with further sub-classification as under:

Small Scale Retailers:

1. Unit Stores: - Unit stores are the retail stores run on proprietary basis dealing

in general stores or single line stores such as drugs, clothes grocery items, hardwires, shoes, books, utensils etc. Single line stores are mostly called as specialty shops as they may specialize in one line only.

2. Street Traders: Street traders are the retailers who display their stock on footpaths, or the sidewalks of busy spots of cities and towns. The most


prominent places are bus-stands, railway stations, parks and gardens, squares and so on. They deal in light goods in demand.

3. Market Traders: These retailers open their shops on fixed days or dates in specified area. The time interval may be a week or a fortnight or a month. They do join fairs and arrangements with built-inflexibility.

4. Hawkers and Peddlers: This class of retailers has been there in all the centers from the time immemorial. They do not have any fixed place of business. They carry the goods from one place to another on hand cart selling the goods from door to door. They keep on moving from locality and business-to-business with the change in the season. Thus ice candy seller has a brisk business in summer and may change over to corn flakes in rainy and winder seasons.

5. Cheap-jacks: Cheapjack is a retailer who has fixed place of business in a locality but goes on changing his place to exploit the market opportunities. Change of locality is quit common in case of these retailers. These deal in cheap varieties of readymade garments, plastics shoes and the like. However, the speed of change of locality is not as fast as that of hawkers and peddlers.

6. Syndicate Stores: It is an extension of the theory of mail-order business on a small scale. Syndicate stores are known for widest varieties of goods in a product line but of known brands. These retailers buy most of the unbranded varieties and try to sell under their names. These apply to ready made garments, toys, machinery items and so on.

B Large Scale Retailers

1. Departmental Stores: It is a large retail store dealing in a wide variety of

goods under a single roof. It is essentially an urban retail outlet designed for mass selling dealing in almost Aspirin to zip, mostly catering to the needs of higher income groups. It is a central location and unified control. It is known for orderly arrangement of products in separate departments and it lays emphasis on consumer’s service. The best examples of this kind in India are: Ebony stores, Spencer’s, Super bazaar.

2. Multiple Shops: A multiple shop or a chain store is a system of branch shops operated under a centralized management and dealing in similar lines of goods. It is chain of retail stores dealing in identical and generally restricted range of articles separating in different localities under central ownership and control. It works on the principle of centralized buying and administration and decentralized selling. The attributes of multiple shops are: cash and carry-limited lines of articles – items are consumer durables – decentralized selling in different localities. The examples of this kind are: Bata Shoes, Swastik Shoes, Flex shoes, Carona Shoes.

3. Mail Order Houses: As the title suggests, the seller contacts the buyer through some form of advertising. That is the customers do not visit the seller’s premises nor there is personal inspection of goods before the purchase. The transaction is settled through postal medium mostly through V.P.P. or Registered post. That is why; some prefer to call it as selling by post. As the goods are sent through post parcel, the article must be well-known, describable, command demand and are durable, in addition to high value. The examples of this kind are – patent medicines and chemicals, jewelry, leather goods, ready-made garments and so on. These units are confined to cosmopolitan areas. Thus, Mail Order Sales limited to Mumbai deals in ‘Bull-worker’ a fit-kit.

4. Consumer Cooperatives: These are the retailers or stores owned by a group of consumers themselves on cooperative principles. It is an association of


consumers to obtain their requirements by purchasing in bulk and selling through the stores to the member and non-member consumers. It believes in wholesale buying and retail selling at reasonable prices than prevailing in the open market. Almost all towns and cities in India come across these consumer cooperatives. The common name chosen is ‘A provided by the wholesalers Apna Bazar’ or ‘Janta Bazar’ or may be named after a locality say ‘Bardez Bazar’ in north goa.

5. Fair Price Shops: These are the retail outlets started by the manufacturers in different cities and towns to sell at prices, which are quite fair. This practice is very common with every states of the country used as a means for public distribution. Thus, it can be a private, public or even cooperative sector unit engaged in retail business to ensure regular equitable and adequate supply of essential commodities at just or fair prices. These are designed to meet the requirements of the weaker sections of the society for ration etc.

Q10. What are the different components of physical distribution supply? Ans. The components of physical distribution supply are:

The components of physical distribution system are order processing inventory management, materials handling and transportation.

1. Order processing: It includes the activities of receiving, filling and assembling

the orders for shipment. 2. Inventory management: It means and includes the management of products

on the move. It is planning and controlling finished goods after they have been brought from production centers and before their deliveries to the users. It has two aspects namely warehousing and inventory controlling.

A Warehousing: It is the act of storing and assorting the finished goods so as to create maximum time utility at minimum cost. The exact location can be centralized or decentralized. The plus points of centralized warehousing are:

(i) No need to carry large stock. (ii) Easy meeting of demand fluctuations. (iii) Improved operating efficiency. (iv) Optimal use of transport facilities.

The minus points are:

(i) Heavy transport cost (ii) Loss of customer service. (iii) Loss of potential market. On the other hand the plus points in favor of decentralized warehousing are: On the other hand the plus points in favor of decentralized warehousing are: (i) Better customer service (ii) Savings in freight (iii) Facilities product movement by block rates. The minus points are: (i) Heavy investment. (ii) High administrative costs.

B Inventory controlling: Inventory control implies holding just stock to minimize costs

and losses. The goals of inventory management are:

1. Providing adequate consumer service and 2. Minimizing firm’s investment in inventory. 3. Material handling: In marketing it signifies the product movement after it gets

out from manufacturing plant but before it is loaded on the transport mode to the destination of customer. The decision areas of material handling are material handling methods and selection of methods. The actual selection is


determined by the factors like – the warehouse layout, the nature of product, the resources, costs of operation and customer service.

4. Transportation: Transportation involves loading and unloading of products and transshipment between the places of dispatch and places of arrival. The transport media mix is made up of railways, roadways, airways, waterways and pipelines.

Railways have the merits such as: (a) large carrying capacity. (b) Economical means. (c) All weather mode. (d) Containerization. (e) Linking international markets.

The minus points are: (a) Costlier over short distances (b) Slower movement. (c) Inordinate delays.

Roadways have the plus points like: (a) Economical over short distance (b) Speedier movement (c) Touching far-flung markets. (d) Lesser conditions of service. The demerits are: (a) Costly over long distance (b) It is fair weather friend. (c) Not suitable for bulk transport.

Airways have the merits such as: (a) Fastest means (b) all weather friends (c) Consumer satisfaction. (d) Reduced inventory holdings. The demerits are (a) It is costlier means (b) Limited coverage (c) Limited cargo capacity. Waterways have the merits like: (a) it is cheaper means. (b) Most suitable for heavy and fragile products. (c) Loading and unloading facilities. (d) No. Problem of congestion. The demerits are (a) slow speed. (b) Unreliable (c) Limited service Pipe-lines have the specific merits such as: (a) Economical. (b) Uninterrupted service. (c) No danger of wastage. (d) Underground The demerits are: (a) Initial heavy investment. (b) Danger of enemy attacks.

section-a 2 marks questions [question 1 to 15] …subject: marketing management (pgdbm/mba-2) 1/36...

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