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Marketing Management

Some Questions and Answers for the Final Examinations
Marketing Management
Section A: Objective Type
Part One:
Multiple choices:
1
...
Marketing Mix
b
...
Marketing Concept
d
...
It involves individuals who buy products or services for personal use and not for
manufacture or resale
a
...
Macro Environment
c
...
Consumer
Answer: d (Consumer)
3
...
Consumer Behavior
b
...
Reference Groups
d
...
The concept of the product that passes through various changes in its total life known as
a
...
Line Stretching
c
...
Product
Answer: a (Product Life Cycle)

5
...
Branding
b
...
Brand Identity
d
...
It involves a pricing strategy that charges customers different prices for the same product
or service
a
...
Price Discrimination
c
...
None
Answer: b (Price Discrimination)
7
...
End Customer
b
...
Retailing
d
...
It involves facility consisting of the means & equipments necessary for the movement of
passengers of goods
a
...
Warehousing
c
...
None
...
The advertising which is used to inform consumers about a new product or feature & to
build primary demands is known as
a
...
Informative Advertising
c
...
Advertising Strategy

Answer: b (Informative Advertising)
10
...
Compensation
b
...
Sales Budgeting
d
...
Write a note on importance of consumer behavior for a business firm
...
They do this by engaging
in exchanges of resources including information, money, goods, services, status, and
emotions with consumers, exchanges that both businesses and customers perceive to be
beneficial
...
This unit
provides a brief insight into the meaning and perspective of Consumer behavior as well as
understanding why it is important to study consumers
...
"
Importance of Consumer Behavior
The study of consumers helps firms and organizations improve their marketing strategies by
understanding issues such as how


The psychology of how consumers think, feel, reason, and select between different
alternatives (e
...
, brands, products, and retailers);



The psychology of how the consumer is influenced by his or her environment (e
...
,
culture, family, signs, media);



The behavior of consumers while shopping or making other marketing decisions;



Limitations in consumer knowledge or information processing abilities influence
decisions and marketing outcome;



How consumer motivation and decision strategies differ between products that differ
in their level of importance or interest that they entail for the consumer; and



How marketers can adapt and improve their marketing campaigns and marketing
strategies to more effectively reach the consumer
...
e
...
For example, by understanding that consumers are more receptive to food
advertising when they are hungry, we learn to schedule snack advertisements late in
the afternoon
...




To Make Better Consumers As a final benefit, studying consumer behavior should
make us better consumers
...
In practice, however, you often pay a size premium by
buying the larger quantity
...


2
...

Answer
Introduction
Setting the right price is an important part of effective marketing
...

Price is also the marketing variable that can be changed most quickly, perhaps in response to
a competitor price change
...

The price of a product may be seen as a financial expression of the value of that product
...


The concept of value can therefore be expressed as:
(perceived) VALUE = (perceived) BENEFITS – (perceived) COSTS
A customer’s motivation to purchase a product comes firstly from a need and a want:e
...



Need: "I need to eat



Want: I would like to go out for a meal tonight")

The second motivation comes from a perception of the value of a product in satisfying that
need/want (e
...
"I really fancy a McDonalds")
...

Perceived benefits are often largely dependent on personal taste (e
...
spicy versus sweet, or
green versus blue)
...

In general, a products perceived value may be increased in one of two ways – either by:
(1) Increasing the benefits that the product will deliver, or,
(2) Reducing the cost
...

Factors affecting demand
Consider the factors affecting the demand for a product that are
(1) within the control of a business and
(2) outside the control of a business:
Factors within a businesses’ control include:


Price (assuming an imperfect market – i
...
not perfect competition)



Product research and development



Advertising & sales promotion



Training and organisation of the sales force



Effectiveness of distribution (e
...
access to retail outlets; trained distributor agents)



Quality of after-sales service (e
...
which affects demand from repeat-business)

Factors outside the control of business include:


The price of substitute goods and services



The price of complementary goods and services



Consumers’ disposable income



Consumer tastes and fashions

Price is, therefore, a critically important element of the choices available to businesses in
trying to attract demand for their products
...

As the consideration given in exchange for transfer of ownership, price forms the essential
basis of commercial transactions
...
In commerce, price is determined by what (1) a buyer
is willing to pay, (2) a seller is willing to accept, and (3) the competition is allowing to be
charged
...
It is a criminal
offense to manipulate prices in collusion with other suppliers, and to give a misleading
indication of price such as charging for items that are reasonably expected to be included in
the advertised, list, or quoted price
...

3
...

Answer
Introduction
In general we use ‘marketing’ and ‘selling’ as synonyms but there is a substantial difference
between both the concepts
...
Selling has a prod¬uct focus and mostly producer driven
...
The
emphasis is on price variation for closing the sale where the objective can be stated, as “I
must somehow sell the product”
...
The end means of any sales activity is maximizing
profits through sales maximization
...
It is also the task of the sales department to sell
whatever the production department has manufactured
...


Selling converts the product in to cash for the company in the short run
...
While selling revolves around the needs
and in¬terest of the manufacturer or marketer, market¬ing revolves around that of consumer
...

Key features of Selling Concept


Emphasis is on the product



Company Manufactures the product first



Management is sales volume oriented



Planning is short-run-oriented in terms of today’s products and markets



Stresses needs of seller



Views business as a good producing process



Emphasis on staying with existing technology and reducing costs



Different departments work as in a highly separate water tight compartments



Cost determines Price



Selling views customer as a last link in business

Marketing Concept
Marketing consists of all those activities that are associated with product planning, pricing,
promoting and distributing the product or service
...
It is a long chain of activity, which comprises
production, packing, promotion, pricing, distribution and then the selling
...
Profits are not ignored but they are built
up on a long run basis
...

According to Prof
...
A truly marketing minded firm tries to create value satisfying goods and
services which the consumers will want to buy
...
The seller takes his cues from the buyer and the product becomes
the consequence of the marketing effort, not vice versa
...
On the
contrary, marketing views the en¬tire business as consisting of a tightly integrated effort to
discover, create, arouse ad satisfy customer needs’
...
What are the new trends in advertisement?
Answer
Introduction
Advertising is a very powerful business
...
Across time, we have been witness to big changes in advertising, from merely
communicating a product or service, to highly sophisticated multidimensional and multichannel strategies, and always with the same goal: to induce someone to buy or use that
product or service
...
Across time, we have seen a huge evolution of those
weapons, new techniques and trends, new products, new strategies, new media… How ever,
as in many other industries, the really big change, the authentic “next big thing” comes with
the advent of the Internet
...
Let's review some of the

changes that will, in the coming years, turn the world of advertising completely to greater
heights
...
Think, for example, about that crazy email you got from your friend -the one featuring the water skiing squirrel
...
And before you
realized it, you had "consumed" a brand message, and experienced one of the new advertising
trends
...
Thanks to YouTube, blogs, TiVo, Facebook and
basic email, people are spending less time watching television commercials and reading print
ads
...

Declining ad purchases
...
S
...
6 billion last year
...

Conversely, as conventional advertising has been sinking, the number of videos seen online is
rising
...

So, clever folks that they are, advertisers have found new ways to capture those eyeballs,
ideally without offending the people behind them
...
Laughing for dollars
Say your product is a tortilla chip, or a beer, or a sexploitation chick cop flick
...
And where will you find them? In front of their computers,
watching two of the things they love most -- ideally at the same time during Burly Sports
Show on Heavy
...
com
...
" They play
directly to the ADD nature of the Internet, and people looking for quick breaks in their
workday
...
In return for the laughs, viewers allow the sponsors to ply their wares -- sometimes in
the frame around the screen, sometimes as part of the entertainment
...

You Tube
...
It's just that the smart money is spending
less of theirs on media, and placing ads on You Tube
...
YouTube is a vehicle to attract viewers who might not be
watching as much TV, or skipping the shows in the brand's media buy
...
The spot developed for an audience in Peoria is now
reaching you wherever you are, thanks to You Tube's international exposure
...
Products get a cameo
You and eight castaways are stranded on an island, competing for $1,000,000
...
Fortunately, Survivor host
Jeff Probst announces that you could win one of the nearby crates
...
It's a shameless plug, also known
as product placement
...
Sometimes, it's as overt as
Probst pointing to a Sears crate
...
Either way, it gets noticed within the confines
of the show
...
The new: 30 second TV spot
Whenever a serious news event occurs, like a politician or celebrity behaving badly, you
Google a naughty phrase and arrive at a news website, ready for the skinny
...
Those intros can range from a
simple logo with the words "brought to you by," to a shortened version of a TV spot
...
Even better for the brand, they may have preidentified you as a likely prospect through your past Internet behavior, and might even be
able to drive you from promo to purchase at their website
...
Slipping ads under the radar, via email
Remember our friend the skiing squirrel? He's hardly the only star of a sight gag gracing your
email in bin
...
" Advertisers realize that you're
more likely to open a video from someone you know
...
So don't think of your forwarding friend as one of those
annoying people who sends on every email she receives
...
Briefly explain the following
...
Socio – cultural environment
...
Marketing environment interface
...
Socio – cultural environment
...
Economic life is organized primarily through a market in
which individuals relate to one another as buyers and sellers and the purpose is production
...
The economic and political systems together create the
conditions—goods, services and rules—which we all need in order to live the kinds of lives
that we choose
...
g
...


Culture is an attribute of groups, and this can mean society as a whole (e
...
national culture),
groups within society (sub-cultures), or even groups of societies and nations (trans-national
culture)
...
This term implies that there
are certain values and ways of life that western societies might be said to share, such as:
Secularism—this refers to the increasing influence of rational and scientific thought, and the

decline of religion as a framework of understanding and guide to behavior
...
A good life means having more ‘stuff ’
...
Individualism—this usually
refers to the idea that individuals make their own life-style choices and are motivated
primarily by self-interest
...
However these attitudes or values vary in strength between western societies (e
...
UK
society is more secular than the United States), and they also have their own distinctive
cultural traits
...
g
...


b
...

Answer
Introduciton
Business environment comprises the exterior factors that influence the company operations
either direct or indirect
...

The environment can not be influenced by the company as it is comprised of external factors
...
There are big companies that have a major influence on environment factors
and small businesses that need to adapt continuously to environment changes
...
There are opportunities the
company can capitalize in its relations with business partners, but also threats to be avoided
or prevented
...

Internal micro-environment consists of strategic orientations and organization structures
that capitalize on the human, material and financial resources of the company
...
This is developed by the management and leads the
company's activities to operations focused on production, technology, sales or market
...

Marketing integration
...
The marketing
function must be an integrator function for all other functions, so that the marketing concept
can be promoted
...
It represents a series of values and beliefs promoted company-wide,
being a result of cultural elements that characterize the people that run the business or support
it: employees, managers, shareholders, union
...

Employees
...
Employees'
satisfaction is important because it results in customer satisfaction
...

External micro-environment factors are:
Financial and material suppliers
...
This sort of situations can lead to operation
blockage caused by lack of resources
...

Marketing intermediates
...


Customers
...
They are the main microenvironment element because they assure operation continuity by purchasing the company's
products for consumption or use
...

Competitors
...
The main concern relating to competitors in gaining competitive
advantages
...
Mass-media, public administration, politic groups, shareholders, all these factors
can create both opportunities and threats for the company
...

National macro-environment comprises factors that affect the entire society and have also a
influence

on

the

company

but

long

term

and

wide

spread
...

Cultural factors, related to values, beliefs, religion, customs
...
The factors that influence the international macro-environment are:


Commercial policies (regarding customs, import, export)



International investment fluxes



Financial and monetary international processes



International markets



Treaties between countries
...
The answer: a premier Indian retail
company that has come to be known as a specialty chain of apparel and accessories
...
Set up
and headed by former Corona employee, B
...
Nagesh, Shoppers' Stop is India's answer to
Selfridges and Printemps
...
' Back
in 1991, there was the question of what to retail
...
Finally, common sense and
understanding won out
...
They
knew the male psyche and felt that they had discerning taste in men's clothing
...
The first Shoppers' Stop store took shape in Andheri, Mumbai, in
October 1991, with an investment of nearly Rs
...
The original concept that formed
the basis of a successful marketing campaign for seven years is here to stay
...
160 crores and five stores, nine years later
...
More than 60 per cent of the
customers who walked into Shoppers' Stop in Mumbai were women
...
Soon, the store set up its women's section
...
The second store in Bangalore came in 1995
...
ft
...
All this while, the product range kept
increasing to suit customer needs
...

Secure in the knowledge that organised retailing in global brands was still in its infancy in
India, Shoppers' Stop laid the ground rules which the competition followed
...
Yes, feeling -for in India, shopping remains an outing
...
It has leveraged expertise for a critical component like technology from all over
the world, going as far as hiring expatriates from Littlewoods and using state-of-the-art ERP
models
...
Expertise was imported wherever it felt that expertise available in-house was
inadequate
...
A shortage of the most important
resource of them all was trained humans
...
By 1994, the senior executives at Shoppers' Stop
were taking lectures at management institutes in Mumbai
...
Getting the company access to the latest global retail trends and exchange of
information with business greats was an exclusive membership to the Intercontinental Group
of Department Stores (IGDS)
...
K
...

With logistics I in place, the accent moved to the customer
...
The studies confirmed what it already knew
...
In India, customers like to touch and feel the merchandise, and scout for options
...
So, transactions must be in cash
as against plastic money used the world over
...
The company's customer profile includes people
who want the same salesperson each time they came to the store to walk them through the
shop floors and assist in the purchase
...
Still others wanted someone to carry the bags
...
The in-house
wardrobe audit also helped with another facet of the business
...
In fact, the USP of
Shoppers' Stop lies in judiciously selected global brands, displayed alongside an in -house
range of affordable designer wear
...
Brand
selection is the same across the five locations, though the product mix may be somewhat
city-based to accommodate cuts and styles in women's wear, as well as allowing for seasonal
variations (winter in Delhi, for instance, is a case in point)
...
In-house
labels are available at competitive prices and target the value-for-money customer and
make up around 12 per cent of Shoppers' Stop's business
...
To cash in on this, the company has big plans for
its in-house brands: from re-branding to repositioning, to homing in on product categories
where existing brands are not strong
...
The in-house brand shopper is one

who places immense trust in the company and the quality of its goods and returns for repeat
buys
...
With 60,000 odd members, FCC customers
account for 10 per cent of entries and for 34 per cent of the turnover
...
Not one to let such an opportunity
pass, the company ran a successful ad campaign (that talks about just this factor) in print
for more than eight years
...
In 1999, a TV spot, which liked the
shopping experience to the slowing down of one's internal clock and the beauty of the
whole experience, was aired
...
The campaign is based on entries entered in the
Visitors' Book
...
The ads only show shoppers having the time of their lives in
calm and serene locales, or elements that make shopping at the store a pleasure -quite the
perfect getaway for a cosmopolitan shopper aged between 25 and 45
...
And it has worked wonders
...
To top it all, cafes and coffee bars make sure that the customer does not step
out of the store
...
Although the food counter
was not planned, it came about as there was extra space of 67,000 sq
...
Carrying the perfect
experience to the shop floor is an attempt to stack goods in vast open spaces neatly
...
Each
store is on lease, and this is clearly Shoppers' Stop's most expensive resource proposition renting huge spaces in prime properties across metros, so far totaling 210,000 sq
...
Getting that space was easy enough for Shoppers' Stop, since its promoter is the
Mumbai-based Raheja Group, which also owns 62 per cent of the share capital
...
What are the significant factors that have led to the success of Shoppers' Stop?
2
...

3
...
How should Shoppers' Stop develop its demand forecasts?
Case Let 1
Solution

1
...
The first was
an inherent understanding of their core strengths in menswear and addressing the same by
promoting men’s apparel in their showrooms
...
The second was in understanding the psyche of an Indian buyer in wanting
customized attention while buying and in wanting an intrinsic ‘buying’ experience each time
they entered into a shop
...
A
combination of these factors along with focus on a facilitating experience gave the Shoppers’
Stop venture a unique selling proposition
...
B
...
Nagesh, their
CCA & MD, who is a prominent professional in the retail sector in the country and has been
the first Chairman of the CII Committee on Retail in 2001 and has received various awards
over the years including ‘Retail Professional of the Year’ for the years 2003, 2004 and 2006
by CMAI, ‘Retail Professional of the Year’ in 2005 at the ICICI Retail Excellence Awards,
‘Entrepreneurship Award’ at the Enterprise Scions Awards by DNA
Money in November 2006 and the ‘Visionary Award’ from ICFAI in 2006
...
Govind Shrikhande, CCA, Executive Director and CEO
...

They were awarded the ‘Best Top Management Team of the Year’ in 2002 by CMAI
...
The HR policies aim to
create an engaged and motivated work force, which is essential for success in any service
oriented industry such as theirs
...
They have been able to capture their
learning over the years and use them to create Standard Operating Procedures (‘SOPs’) for
each of the activities, right from planning and setting up of new stores to their day to day
operations
...
They also have a Manual of Authority, outlining the framework of
financial and legal decision making authority at all levels in their Company, right up to the
CCA & MD and the CCA, Executive Director & CEO
...
As they grow in size, systems and processes will be the key driver and differentiator to
organised operations and enhanced profitability
...
Most of the processes are linked online, and utilize some
of the leading technologies available to deliver overall control and efficiency
...
Their IT systems help them not only to monitor customer purchase
patterns, but also allows the organization to quickly respond to it by facilitating decision
making and providing the tools to adjust their operational strategy accordingly
...
They have received the IT user award from
NASSCOM for Best IT Practice in Retail Category in 2003
...
20 square feet handling over 400,000 SKUs per year, and working
24x7
...
The Distribution Center
management is outsourced to service providers such as Toll (India) Logistics Private Limited
...
They have
undertaken various initiatives in further improving the efficiencies of their supply chain,
which they believe is critical for any retailer
...


Vast range of lifestyle products and services
Their merchandise ranges across apparel, accessories, perfumes, cosmetics, home and kitchen
products with over 400,000 SKUs, which are complemented by their services offerings
...

Internationally benchmarked shopping environment
They believe and focus on providing their customer a globally benchmarked shopping
environment with the best in class service which has been instrumental in their success
...
They periodically
provide the managers exposure to international department stores through IGDS to be able to
capture and implement best practices in their operations
...
It is because of this service and ambience that they offer, has created a differentiation
in the mind of the customer versus their competitors where similar products and brands are
available
...
They enjoy Anchor Tenant status in most of the malls that are presently
located in due to their high brand awareness and trust, ability to draw a large number of
customers and occupy a significant space in the mall
...

Large base of loyal customers
They had 19
...
They
believe that the emotional connect that they have been able to create with their customers
through their service offering and special promotions has helped them convert many of them
into loyal customers
...

2
...

Shoppers’ Stop initially started out as a retail entity for menswear
...
The focus then diversified to other segments as well
since the major customers in these shops were primarily women
...
These brands are changed in line with customer expectations on a
periodic basis
...

Shoppers’ Stop (SS) is the leading department store company in India
...
However, the stock has priced in the bulk of its
upside potential leaving little room for positive surprise, in our view
...

In our view, income elasticity in this business segment is high, and as India per capita
incomes grows, SS should capitalize on its growth potential
...
Efficient business
systems, better/standard companywide business practices and a balanced portfolio lowers
SS’s business risk
...
These can
give up further upside to the stock if successful
...




Shoppers Stop began by operating a chain of department stores under the name
“Shoppers’ Stop” in India
...




Started with its first store in Andheri,Mumbai in the year Oct,1991 with the
investment of Rs
...




Shoppers Stop Ltd has been awarded "the Hall of Fame" and won "the Emerging
Market Retailer of the Year Award", by World Retail Congress at Barcelona, on
April 10, 2008



Shoppers Stop is listed on the BSE
...




New Delhi and Jaipur : 1999



For regular customers, launched First Citizen’s Club(FCC) with 60,000 odd
members
...
How are Indian customers visiting Shoppers' Stop any different from customers of
developed western countries?
Shopper's Stop is an chain of department stores in India, with 35 stores across the
country
...
Shopper's Stop
sells clothing, accessories, beauty products, toys, home and travel items
...
There are also cafes and entertainment
...
Since the similarities

between stores are noticeable, one could assume that the customers behave in similar ways as
well
...


•

It’s basic concept is of a successful marketing campaign
...
This gives them idea to set up
women’s section its expanded to include children’s wear and then household
accessories
...


•

Shoppers Stop knows how the Indian consumer thinks and feels while shopping

•

For Indian customer who wants a salesman each time with them so Shoppers Stop
started self-help counters with an assistant at hand for queries or help
...
In
fact the main USP of Shoppers Stop lies in judiciously selected global brands like
Levi’s, Allen Solly etc
...


•

Every store has generic structure, good ambiance
...
What are the key factors which are responsible for its success
...
How should Shoppers' Stop develop its demand forecasts?
Demand Forecasting
Business-to-business
Business-to-business (B2B) describes commerce transactions between businesses, such as
between a manufacturer and a wholesaler, or between a wholesaler and a retailer
...


The volume of B2B (Business-to-Business) transactions is much higher than the volume of
B2C transactions
...
For example, an
automobile manufacturer makes several B2B transactions such as buying tires, glass for
windscreens, and rubber hoses for its vehicles
...
B2B is also used in the context of
communication and collaboration
...
When communication is taking place amongst employees, this can be referred to as
"B2B" communication
The term "business-to-business" was originally coined to describe the electronic
communications between businesses or enterprises in order to distinguish it from the
communications between businesses and consumers (B2C)
...
Today it is
widely used to describe all products and services used by enterprises
...

Demand forcasting techniques are broadly divided in two categories: judgemental and
statistical
...

Judgemental
The main methods in these category are as follows:
Unaided Judgement
...
This is a good
procedure to use when,
•

experts are unbiased,

•

large changes are unlikely,

•

relationships are well understood by experts (e
...
, demand goes up when prices go
down),

•

experts possess privileged information,

•

experts receive accurate and well-summarized feedback about their forecasts
...
To forecast with Delphi the administrator should recruit between five and twenty
suitable experts and poll them for their forecasts and reasons
...
The process is repeated until there is little cange in forecasts between rounds - two
or three rounds are usually sufficient
...

Judgemental Decomposition
...
One then
forecasts the parts individually, using methods appropriate to each part
...
Expert Systems
...
For

example, if local household incomes are in the bottom quartile, then do not supply premium
brands
...
Developing an expert system is expensive and so the method
will only be of interest in situations where many forecasts of a similar kind are required
...

Simulated interaction
...
To use simulated interaction, an
administrator prepares a description of the target situation, describes the main protagonists
roles, and provides a list of possible decisions
...
They then improvise realistic interactions with the other role players until they
reach a decision; for example to sign a trial one-year exclusive distribution agreement
...
Intentions and Expectations Survey
...

In a similar manner,an expectations survey asks people how they expect to behave
...
He should
select a representative sample of the population of interest and develop questions to elicit
expectations from respondents
...
The behaviour of the population is forecast by aggregating the survey
responses
...
methods are used for forcasting
...
Exponential smoothing is the most popular and cost
effective of the statistical extrapolation methods
...

To use exponential smoothing to extrapolate, the administrator should first clean and
deseasonalise the data, and select reasonable smoothing factors
...
Here expert opinion is used to identify the situation which is similar
to the current situation and the data about that is available
...
This
caused a crash in home Video game market
...
By 1990, the Nintendo Entertainment
System dominated the product category
...
By 1993, Sega commanded almost 60 per cent of Video game market and
was one of the most recognized brand names among the children
...
In 1995, Saturn (a division of General Motors) launched a new 32-bit system
...
Sega was the primary software
developer for Saturn and it did not support efforts by outside game developers to design
compatible games
...

Finally, the price of the Saturn system was greater than other comparable game consoles
...
Sony's Play Station
was unveiled in 1994 and was available in 70 million homes worldwide by the end of 1999
...
It too featured 32-bit graphics
that appealed to older audience
...
Nintendo 64 was introduced in 1996 and had
eye-popping 64-bit graphics and entered in more than 28 million homes by 1999
...
Because the company exercised considerable control over software development,
Nintendo 64 had only one-tenth the number of compatible games as Sony's PlayStation
did
...
Sega's share had fallen to a low of 1%
...
And Sega had to do so before either Nintendo or Sony could bring their
next-generation console to market
...
Anxious gamers placed 300,000 advance orders, and
initial sales were quite encouraging
...
5 million Dreamcast machines were
bought within the first four months, and initial reviews were positive
...
By the end of the year, Sega had captured a market

share to 15 per cent
...
Although its
game capabilities were impressive, the system did not deliver all the functionality Sega
had promised
...

Unfortunately, these features either were not immediately available or were disappointing in
their execution
...
Sony and Nintendo followed the same approach for their machines
introduced in 1999
...
Analysts applauded the move to DVD
because it is less expensive to produce and allows more storage than CDs
...
As Sony
marketing director commented, "The full entertainment offering from Play Station 2
definitely appeals to a much broader audience
...
" In addition,
PlayStation 2 is able to play games developed for its earlier model that was CD-based
...
Further enhancing the PS2's appeal is its high-speed
modem and allows the user's easy access to the Internet through digital cable as well as over
telephone lines
...
"We are positioning this as an all-round entertainment player,"
commented Ken Kutaragi, the head of Sony Computer Entertainment
...
Shortly after the
introduction of Neptune, Nintendo changed its strategies and announced the impending
release of its newest game console, The GameCube
...
It would be more attractively priced at $199
...
We want to create the best gaming system
...
Best known for its extra ordinary successes with
games aimed at the younger set, such as Donkey Kong, Super Mario Bros, and Pokemon,
Nintendo sought to attract older users, especially because the average video game player is
28
...
Nintendo
scrambled to ensure there would be an adequate supply of Game Cubes on the date in
November 2001, when they were scheduled to be available to customers
...
With more than 20 million PlayStation 2 sold worldwide, the GameCube
as a new entry in the video game market would make the battle for market share even more
intense
...
Because of strong brand loyalty and high product development costs,
newcomers faced a daunting task in entering this race and being competitive
...
Some observers felt the Xbox was aimed to rival PlayStation 2, which has similar
functions that rival Microsoft's Web TV system and even some lower level PCs
...
This open design allowed Microsoft to develop the Xbox in
just two years, and gave developers the option of using standard PC tool for creating
compatible games
...
As a result of developers' efforts, Microsoft had about 20 games ready
when the Xbox became available
...
Microsoft online strategy was another feature that differentiated of the Xbox from
the GameCube
...
Microsoft also
announced its own Web-based network on which gamers can come together for online headto head play and for organised online matches and tournaments
...
This is a
potential drawback considering that a very low percentage of households world over
currently have broadband connections
...
However, interested players must purchase a network adapter for an
additional $39
...
Although game companies are not keen on the prospect of submitting to
the control of a Microsoft-controlled network, it would require a significant investment for
them to manage their own service on the Sony-based network
...
Prior to the introduction of Xbox, in a competitive move Sony
dropped the price of the PlayStation 2 to $299
...
Gamers eagerly snapped up the new consoles and made 2001 the best year ever for
video game sales
...
4 billion on video game
equipment, which was more than they did at the box office
...
6 million PlayStation 2 consoles had been sold in North America alone, followed
by 1
...
2 million Game Cubes
...
This started when Sony decided to put even more pressure on the Microsoft's Xbox
by cutting the PlayStation 2 price to $199
...

Wanting to maintain its low-price status, Nintendo in turn responded by reducing the price
of its the GameCube by $50, to $149
...
5
and 4 million units worldwide
...
5
million Game Cubes
...
However, seven years after the introduction of original PlayStation, it was
being sold in retail outlets for a mere $49
...
Nintendo 64 was second with 30
per cent, followed by Sony PlayStation 2 with 14 per cent
...
7 per cent
...
The
company said it would develop games for its competitors' consoles
...
As the prices of video game
consoles have dropped, consoles and games have become the equivalent of razors and
blades
...
The profit margins on games are highly attractive, affected to some
degree by whether the content is developed by the console maker (such as Sony) or by an
independent game publisher (such as Electronic Arts)
...
In particular, Nintendo, Sony, and Microsoft
want games that are exclusive to their own systems
...
The sales of video games in 2001 rose to 43
per cent, compared to just 4 per cent increase for computer-based games
...
For one thing, they have a big advantage of
having access to a mouse and a keyboard that allow them to play far more sophisticated
games
...
Sony and Microsoft are intent on
capturing a portion of the online gaming opportunity
...
As prices continue to fall
and technology becomes increasingly more sophisticated, it remains to be seen whether these
three companies can keep their names on the industry's list of "high scorers"
...
Considering the concept of product life cycle, where would you put video games in their
life cycle?
2
...
Considering the concept of product life cycle, where would you put video games in
their life cycle?
Product Life Cycle
A product is introduced or launched into the market; it gains more customers as it grows; and
as a result the market stabilises and the product becomes mature and due to toughcompetition
the product is either overtaken by competitor’s new product which is a result of producing a
new superior product, it goes into the declining stage and finally withdrawn from the market
...
New product is
promoted and awareness is created, at the same time selective distribution takes place in a
few places with fewer distribution channels until customers show complete acceptance of the
product
...
Growth As products become more and more profitable the companies create alliances,
joint ventures in order to take over each other and competitors are attracted into the
market with similar offerings, at the same time a lot of money is being spent on
advertising as
2
...
Maturity This is a phase where the product spends the longest after surviving the earlier

stages
...

Market saturation takes place and some producers have no choice but to leave the market
because of poor margins
...

4
...
Harvesting of the product takes place in this stage by decreasing
the prices while offering the same quality to the loyal customers in a specific area
...
Should video game companies continue to alter their products to include other
functions, such as e-mail?
Wanting to maintain its low-price status, Nintendo in turn responded by reducing the price
of its the GameCube by $50, to $149
...
5
and 4 million units worldwide
...
5
million Game Cubes
...
However, seven years after the introduction of original PlayStation, it was
being sold in retail outlets for a mere $49
...
Nintendo 64 was second with 30
per cent, followed by Sony PlayStation 2 with 14 per cent
...
7 per cent
...
The
company said it would develop games for its competitors' consoles
...
As the prices of video game
consoles have dropped, consoles and games have become the equivalent of razors and
blades
...
The profit margins on games are highly attractive, affected to some
degree by whether the content is developed by the console maker (such as Sony) or by an
independent game publisher (such as Electronic Arts)
...
In particular, Nintendo, Sony, and Microsoft

want games that are exclusive to their own systems
...
The sales of video games in 2001 rose to 43
per cent, compared to just 4 per cent increase for computer-based games
...
For one thing, they have a big advantage of
having access to a mouse and a keyboard that allow them to play far more sophisticated
games
...
Sony and Microsoft are intent on
capturing a portion of the online gaming opportunity
...
As prices continue to fall
and technology becomes increasingly more sophisticated, it remains to be seen whether these
three companies can keep their names on the industry's list of "high scorers"
...
What is sales promotion? Describe briefly the various methods of sales promotional
tools used by business organizations to boost the sales
...

Answer
Introduction
Suppose you go to the market to buy soap
...
You
feel attracted to buy as by doing so you are saving money on one soap
...
He can adopt several
ways for that purpose
...
You
might also have seen gifts like lunch box, pencil box, pen, shampoo pouch etc
...

There are also exchange offers, like in exchange of existing model of television you can get a
new model at a reduced price
...
All these are incentives offered by
manufacturers or dealers to increase the sale of their goods
...
All these
measures normally motivate the customers to buy more and thus, it increases sales of the
product
...

Personal selling involves face-to-face contact with specific individuals, while advertising is
directed towards a large number of potential customers
...
Thus, advertising can be used as means of communication to inform potential
customers about the incentives offered for sales promotion
...
But, sales promotion differs
from advertising and personal selling in terms of its approach and technique
...
These offers are
not available to the customers throughout the year
...
Thus,
sales promotion consists of all activities other than advertising and personal selling that help
to increase sales of a particular commodity
...
However,
there are also some other objectives of sales promotion
...
These are known as tools or techniques or methods of
sales promotion
...

(i) Free samples: You might have received free samples of shampoo, washing powder,
coffee powder, etc
...
Sometimes these free
samples are also distributed by the shopkeeper even without purhasing any item from his
shop
...
Some businessmen distribute samples among selected persons in order to

popularize the product
...

(ii) Premium or Bonus offer: A milk shaker along with Nescafe, mug with Bournvita,
toothbrush with 500 grams of toothpaste, 30% extra in a pack of one kg
...
They are effective in inducing
consumers to buy a particular product
...

(iii) Exchange schemes: It refers to offering exchange of old product for a new product at a
price less than the original price of the product
...
‘Bring your old mixer-cum-juicer and exchange it for a new one just by paying
Rs
...

(iv) Price-off offer: Under this offer, products are sold at a price lower than the original
price
...
2 off on purchase of a lifebouy soap, Rs
...
1000 off on cooler’ etc
...
This type of
scheme is designed to boost up sales in off-season and sometimes while introducing a new
product in the market
...

These coupons can be presented to the retailer while buying the product
...
For example, you might have come across coupons
like, ‘show this and get Rs
...
of Annapurna Atta’
...

(vi) Fairs and Exhibitions: Fairs and exhibitions may be organised at local, regional,
national or international level to introduce new products, demonstrate the products and to
explain special features and usefulness of the products
...
‘International Trade
Fair’ in New Sales Promotion Delhi at Pragati Maidan, which is held from 14th to 27th
November every year, is a well known example of Fairs and Exhibitions as a tool of sales
promotion
...
The customers are required to
collect these stamps of sufficient value within a particular period in order to avail of some

benefits
...

(viii) Scratch and win offer: To induce the customer to buy a particular product ‘scratch and
win’ scheme is also offered
...
In this
way customers may get some item free as mentioned on the marked area or may avail of
price-off, or sometimes visit different places on special tour arranged by the manufacturers
...
This
creates confidence among the customers with regard to the quality of the product
...

2
...
Explain right to safety
b
...
The right to Safety
Answer
Introduction
Consumers have the right to safety of goods and services that are put into the consumption
chain
...

Therefore, goods and service providers must commit themselves and adhere to clear product
safety guidelines
...

Role of Government
Government departments and public agencies also enforce the rights of citizens and
consumers
...
It is also
about the need to ensure that products and services do not negatively impact on the welfare of
consumers
...

Consumer Safety an Insight
The fact that products are legally available for sale does not necessarily mean that they are
safe or healthy
...
But even

tobacco manufactures no longer dispute the fact that smoking damages our health and
sometimes leads to death
...

Products can be contaminated and thus pose health and other safety risks from their point of
origin (usually the factory) or along the distribution chain
...

Reading packaging for storage, use instructions and conditions, ingredients and expiry dates
can help prevent the dangers associated with the consumption of unsafe products and
services
...

Sometimes safe products can turn to be unsafe and harmful if important instructions such as
the conditions under which they should be stored, used and the dates by which they must be
used are not followed
...

This shows us two factors about our right to safety
...
The second factor shown by the right to safety is that consumers have the
responsibility to educate themselves about the goods and services they consume
...
For example, the
United States Centers for Disease Control estimate that 76 million Americans suffer illnesses
from food-borne diseases, leading to more than 5,000 deaths and 325,000 hospitalizations
annually
...

b
...
The laws are designed to prevent businesses that engage in fraud or specified

unfair practices from gaining an advantage over competitors and may provide additional
protection for the weak and those unable to take care of themselves
...
For
example, a government may require businesses to disclose detailed information about
products—particularly in areas where safety or public health is an issue, such as food
...

Promotion of consumer welfare is the common goal of consumer protection and competition
policy
...
Protection of consumers is
accomplished by setting minimum quality specifications and safety standards for both goods
and services and establishing mechanisms to redress their grievances
...
In Kautilya’s
Arthashastra, here are references to the concept of consumer protection against exploitation
by the trade and retailer with respect to quality, short weight, measurement and adulteration
of goods
...
But now it is widely acknowledged that the level of
consumer awareness and protection is a true indicator of development of the country and
progressiveness of civil society
...
For this, governments
need to establish the full quality infrastructure, embracing standardization, 248 Eleventh Five
Year Plan conformity assessment and enforcement
...
)
• Regulation and enforcement
• Accreditation
Consumer Protection in India
The Consumer Protection Act was enacted in 1986 based on United Nations guidelines with
the objective of providing better protection of consumers’ interests
...
The Act
applies to all goods and services unless specifically exempted, and covers the private, public,
and cooperative sectors and provides for speedy and inexpensive adjudication
...
The seller these days are generally big companies enjoying substantial economic
power
...
Further, big
businesses are frequently considered by consumer to be experts in the technology of
product they manufacture and sell
...
Also the companies make tall claims about their products,
which are believed by consumers

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