Notesale: Turn your study into money

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Course Aim/s:
 The objective of this course is to introduce students to the concepts, analysis, and
activities that comprise marketing management
...

Learning Outcome/s:
 They will be able to analyze markets and design customer driven strategies and will
be able to communicate the decisions towards business development with superior
customer value
...

Market Research (MR): Definition of MR - MIS - MR Process - MR Online - MR & Ethics International MR
...

Marketing Mix: Developing Products & Brands - Product Levels - Classifying Products - Product
Range - Line & Mix - PLC - New Product Development
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Positioning: Positioning Maps - Positioning Strategy
Unit-IV: Distribution Decisions, Promotion & Communication Strategies
Distribution Decisions: Marketing Channels - Channel Intermediates and Functions - Channel
Structure - Channel for Consumer Products - Business and Industrial Products - Alternative Channel Channel Strategy Decisions
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Marketing Communication: Communication Process – Communication Promotion Mix - Factors
affecting the Promotion Mix
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Types of Marketing: Word-of-mouth - Rural Marketing - BOP - Relationship Marketing - Digital
Marketing - Social Marketing - Services Marketing - Global marketing
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 Ramaswamy Namakumari, ―Marketing Management‖, TMH Edition
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 Czinkota Kotable ―Marketing Management‖ Indian Edition, Cengage learning
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A
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Krishnamoorthy, Marketing Management concept and cases, HPH
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Maheswari, Marketing Management (Text & Cases) an Indian
MRCET MBA
Perspective, IBH
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" The term
developed from the original meaning which referred literally to going to market with goods
for sale
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Philip Kotler defines marketing as:-marketing is about Satisfying needs and wants through
an exchange process
...
" A
similar concept is the value-based marketing which states the role of marketing to contribute
to increasing shareholder value
...
"
The process of marketing is that of bringing a product to market in which includes these
steps: broad market research; market targeting and market segmentation; determining
distribution, pricing and promotion strategies; developing a communications strategy;
budgeting; and visioning long-term market development goals
...
g
...
)
involve use of the creative arts
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This concept originated from Adam Smith's book The
Wealth of Nations, but would not become widely used until nearly 200 years later
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Given the centrality of customer needs and wants in marketing, a rich understanding of
these concepts is essential:
Needs: Something necessary for people to live a healthy, stable and safe life
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Needs can be
objective and physical, such as the need for food, water and shelter; or subjective and
psychological, such as the need to belong to a family or social group and the need for selfesteem
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Wants are not essential for
basic survival and are often shaped by culture or peer-groups
...

Marketing research, conducted for the purpose of new product development or product
improvement, is often concerned with identifying the consumer's unmet needs
...
" Needs-based segmentation (also known as benefit segmentation)
"places the customers' desires at the forefront of how a company designs and markets products or
services
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In addition, a great deal of advertising and
promotion is designed to show how a given product's benefits meet the customer's needs, wants
or expectations in a unique way
...
The marketing
environment of a business consists of an internal and an external environment
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The
external environment is further divided into two components: micro & macro
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It consists of factors engaged in
producing, distributing, and promoting the offering
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The broad environment is made
up of six components: demographic, economic, physical, technological, political-legal, and
social-cultural
environment
...
– Philip Kotler

Components of Marketing Environment
The marketing environment is made up of the internal and external environment of the business
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MRCET MBA

Internal Environment
The internal environment of the business includes all the forces and factors inside the
organisation which affect its marketing operations
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Nevertheless, the internal marketing environment is as important
for the business as the external marketing environment
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External Environment
The external environment constitutes factors and forces which are external to the business and on
which the marketer has little or no control
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It
comprises of external forces and factors that are directly related to the business
...

Market intermediaries include parties involved in distributing the product or service of
the organisation
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which conduct business with the organisation
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Competitors are the players in the same market who targets similar customers as that of
the organisation
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Macro Environment: The macro component of the marketing environment is also known as
the broad environment
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The macro environment can be divided into
6 parts
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Demographic Environment: The demographic environment is made up of the people who
constitute the market
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2
...
These factors include the GDP, GNP,
interest rates, inflation, income distribution, government funding and subsidies, and other major
economic variables
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Physical Environment: The physical environment includes the natural environment in which the

business operates
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4
...
Technology is one of the biggest sources of threats
and opportunities for the organisation and it is very dynamic
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Political-Legal Environment: The political & legal environment includes laws and government‗s
policies prevailing in the country
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6
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This differs in different
regions
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Marketing is the base of successful business and it is due to marketing that a business venture
flourishes touching the heights of glory
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There are three steps that are required to promote a product successfully
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Lets discuss each step STP
Process in detail
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Market Segmentation
2
...
Market Positioning

MRCET MBA

Market Segmentation
'Market Segmentation' is one of the most important pillars of marketing strategy
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Suppose, Sony Ericson designs mobiles for boys and girls, airlines offer
both business and economy classes
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For this purpose marketer analyze the segment weather it is beneficial for
long run or not, this evaluation and selecting of segment is called targeting
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We can also say that targeting is actually cutting up the market pie into
different parts
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Steps of Segmenting
Evaluate Market Segments
1
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Segment attractiveness
3
...

2
...

4
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Positioning defines as ―the process
by which marketers try to create or build an image (identity) of their products or services in the
mind of their targeted segment‖
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There are two type of market positioning
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Re-positioning involves changing the identity of a company‗s product or service relative to
competitors
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2
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This is called changing competitors product image
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A
company must consider these elements of market choices to develop market position of their
product or service
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Pricing
2
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Service
4
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Marketing research specifies
the information required to address these issues, designs the method for collecting information,
manages and implements the data collection process, analyzes the results, and communicates the
findings and their implications
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The goal of marketing research is to identify
and assess how changing elements of the marketing mix impacts customer behavior
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Marketing research process
Step 1: Problem Definition
The first step in any marketing research project is to define the problem
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Problem
definition involves discussion with the decision makers, interviews with industry experts,
analysis of secondary data, and, perhaps, some qualitative research, such as focus groups
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Step 2: Development of an Approach to the Problem
Development of an approach to the problem includes formulating an objective or theoretical
framework, analytical models, research questions, hypotheses, and identifying characteristics or
factors that can influence the research design
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Step 3: Research Design Formulation
A research design is a framework or blueprint for conducting the marketing research project
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Conducting exploratory
research, precisely defining the variables, and designing appropriate scales to measure them are
also a part of the research design
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It is also
necessary to design a questionnaire and a sampling plan to select respondents for the study
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2
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4
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6
...

8
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Proper selection,
training, supervision, and evaluation of the field force help minimize data-collection errors
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Each
questionnaire or observation form is inspected, or edited, and, if necessary, corrected
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The
data from the questionnaires are transcribed or key-punched on to magnetic tape, or disks or
input directly into the computer
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Univariate techniques are used for
analyzing data when there is a single measurement of each element or unit in the sample, or, if
there are several measurements of each element, each RCH variable is analyzed in isolation
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Step 6: Report Preparation and Presentation
The entire project should be documented in a written report which addresses the specific research
questions identified, describes the approach, the research design, data collection, and a data
analysis procedure adopted, and presents the results and the major findings
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In addition, an oral presentation should be made to management using tables, figures,
and graphs to enhance clarity and impact
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This method is also helpful in situations where little information is
available from other sources, as in the case of radically new products
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Primary data,
on the other hand, are originated by the researcher for the specific purpose of addressing the
research problem
...

Secondary data are an economical and quick source of background information
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Sometimes qualitative research must be undertaken to gain a qualitative understanding
of the problem and its underlying factors
...
Other exploratory research techniques, such as pilot surveys with small
samples of respondents, may also be undertaken
...
Like market research, online market research aimed as well getting as much knowledge
your target group, product or market
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



Internet as a method of research
Internet as a object of research
Internet as a medium of research

This article focused on the first topic „Internet as a method of research―
...
The methods of online market research are the same methods used
in the traditional market research: interview, observation, case studies and focus groups
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Secondary research is not build on own data, it falls back to pre-existing data on the
internet
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Primary research on the
other hand builds its own data
...
Reactive methods in the
context of online market research are online surveys, online observations and online focus
groups
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MRCET MBA

1
...
The survey is programmed
and the processing occurred through local browsers
...
g
...
But
there are also existing different disadvantages such as the missing possibility to control the
situation of the survey (similar to normal surveys, researchers can check the time to fill out the
survey
...
Online Observation
Via online observation, market researchers basically examine the reaction of users about
companies, organizations, products or services
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Market researchers can also use blogs, for
example, to inform about the users opinion
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Online focus groups
Another subset of the methods of online market research is online groups
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The
online focus group is lead by a moderator who uses predetermined questions and unscripted
probes
...
Online panel
An online panel is a group of users, who confirmed participating in constant online studies
...

Because of the own decision to participate at the panel, the biggest problem of online panels is
the missing representativeness
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MARKETING RESEARCH ETHICS
Marketing research has experienced resurgence with the widespread use of the Internet and the
popularity of social networking
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The way a company
conducts its market research these days can have serious ethical repercussions, impacting the
lives of consumers in ways that have yet to be fully understood
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MRCET MBA

1
...
This type of ethical
problem can run the gamut — from not telling customers that information is being collected
when they visit a website to misrepresenting research results by changing database numbers
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2
...

Companies have an unprecedented ability to collect, store and match information relating to
customers that can infringe on a person's right to privacy
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The company uses
this information to reach the customer with targeted advertising, but the process of targeting can
have a chilling affect on personal freedom
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Breaches of Confidentiality
Another significant ethical consideration involved in market research involves breaches of
confidentiality
...

Some companies sell information they have gathered on customers to outside companies
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4
...
Market researchers
have an ethical obligation to conduct research objectively, so that available data allows for the
development of a balanced or reality-based picture
...

For example, a market researcher with a one-dimensional view of minorities could do a fair
amount of harm if allowed to shape an advertising campaign based on skewed data collection
...


1
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
Identify 5 to 10 large and fast-growing markets for your product or service
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Has market growth been consistent year-to-year? Did
import growth occur even during periods of economic recession? If not, did growth
resume with economic recovery?
Consider smaller emerging markets that may hold ground-floor opportunities for you
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
Target a few of the most promising markets for further study
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Assess target markets







Examine trends that could influence demand for your product or service
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
Study the domestic and international competition
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
Identify what affects the marketing and use of the product or service in each market, such
as channels of distribution, cultural differences and business practices
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
Search for Canadian or foreign government incentives to promote the export of the
product or service
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Draw conclusions



Analyzing the data you have collected should help you decide which markets to go after,
and assist in the development of your export plan and marketing strategy
...


MRCET MBA

UNIT II
CONSUMER DECISION MAKING
There are five Step of the Consumer Decision Making Process
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
Information search - The consumer gathers information
Alternatives evaluation - weigh choices against comparable alternatives
Purchase decision - Consumer makes actual purchase
Post-purchase evaluation - reflection from both the consumer and seller

1
...
According to Bruner (1993)
recognition of a problem arises in the situation where an individual realizes the difference
between the actual state of affairs and desired state of affairs
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For
instance, consumer may recognize the need to buy a laptop when there is need to carry it use it in
different places which is convenient compared to a desktop computer
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The following categories are mentioned: psychological and functional or physical needs
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MRCET MBA

According to Tyagi (2004) need recognition at various levels often occurs during the process of
encountering with the product at various circumstances
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The human need has no limit therefore; the problem recognition is a repetitive in nature
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2
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Once the need is recognized, the consumer is
likely to search more product-related information before directly making a purchase decision
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Search of information process itself can be divided into two parts as stated by Oliver (2011): the
internal search and external search
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For example, searching for fast food can be an example for internal search because
customers often use their knowledge and tastes to choose the right product they need rather than
asking someone for an advice
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For instance, consumers who wish to buy new furniture or a
mobile phone tend to ask friends‗ opinion and advices or search in the magazines and media
before making a purchasing decision
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The author specifically
highlights the role of online user reviews and forums in terms of their significant impact upon
information search stage of consumer decision making process among internet users
...
Moreover, according to Kahle and Close (2006) the
nature of influence of peers, friends and family members upon information search and consumer
decision making process in general depends on a range of factors such as the nature of
relationships, the level of personal influence, the extent of ‗opinion leadership‗ associated with
specific individuals etc
...
Evaluation of Alternatives
After gathering enough information at the first stage the consumer gets into comparing and
evaluating that information in order to make the right choice
...
Moreover, another various aspects of
the product such as size, quality, brand and price are considered at this stage
...

Furthermore, according to Ha et al (2010), the process of evaluation of alternatives can
sometimes be difficult, time consuming and full of pressure for a consumer
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For instance,
when it comes to online hotel reservation or furniture purchasing evaluation process, it can be
quite complex
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Factors such as age, culture, taste and budget have all impact on the evaluation process
by the consumer
...

Moreover, celebrity endorsement is seen as another factor with great potential impact on
evaluation of alternatives stages of consumer decision making process
...
(2010) explain
the effectiveness of celebrity endorsements with perceived greatness people associate with their
idols and the willingness and desire to become like their idols
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Purchase Decision
Once the information search and evaluation process is over, the consumer makes the purchasing
decision and this stage is considered to be the most important stage throughout the whole
process
...
Purchased further can be
classified into three different types: planned purchase, partially purchase and impulse purchase
(Kacen, 2002)
...
For example, the desired product may not be
available at the stock
...

According to Wiedmann et al
...

At the same time Wiedmann et al
...


5
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Many
companies tend to ignore this stage as this takes place after the transaction has been done
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Therefore this stage reflects the
consumer‗s experience of purchasing a product or service
...

The opinions of peers, friends and family regarding the purchases made is specified as one of the
most important factors affecting the outcome of post-purchase evaluation by Perrey and
Spillecke (2011)
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Brink and Berndt (2009) also highlights the importance of the post-purchase evaluation stage
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The outcome forms
the experience of the customer and it this experience is believed to have a direct impact on the
next decision of the consumer to purchase the same product from the same seller
...


CREATING CUSTOMER VALUE
...
142) - “Customer value is a customer‟s perceived preference
for and evaluation of those product attributes, attribute performances, and consequences arising
from use that facilitate (or block) achieving the customer‟s goals and purposes in use situations"
...

Customer value is the difference between total customer value and total customer cost
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Total customer cost is the sum of monetary cost, time cost, physics cost, and energy cost
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

Appropriate features
and customization
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Appropriate outcomes - effectiveness, operational benefits, and environmental benefits
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Ford focus on
performance, and Pfizer focus on appropriate outcomes and consequences
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For example - most restaurants focus on
sensory values like aesthetics, aromas, ambiance, feel or tone
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Symbolic or Expressive Value: It is concerned with the extent to which customers associate
psychological meaning to a product
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Branded products like BMW, Rolex, etc are purchased because of their status, prestige,
and image
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Marketers are
involved in analyzing rising customer trends that suggest new marketing opportunities
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A consumer market is a marketplace that comprises of household
consumers who buy goods for individual or family utilization
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The consumer market pertains to buyers who buy goods and services for consumption rather than
resale
...
These
particular consumer characteristics consist of various demographic, psychographic,
behaviouralistic and geographic traits
...

Demographic Characteristics of consumer markets are based on demographics such as
dissimilarities in gender, age, ethnic background, income, occupation, education, household size,
religion, generation, nationality and social class
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From survey results, companies used to discover
which demographic groups comprise the majority of their customer base
...

Psychographic Characteristics: In consumer market, Psychographic characteristics can also be
found that include interests, activities, opinions, values and attitudes
...
Opinions and attitudes can be both precise
MRCET MBA

and general
...

Consumer values can affect to how a group of individuals feels about some social issues, which
can be of interest to non-profits or charitable organizations
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Behavioralistic
characteristics of consumer markets include product usage rates, brand loyalty, user status or
how long they have been a customer, and even benefits that consumers seek
...
Marketers interested to know which customers are brand
loyalists, as those consumers usually only buy the company's brand
...

These geographic characteristics are often based on market size, region, population density and
even climate
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A marketer must be fully knowledgeable of both theory
and reality of consumer behavior
...
Majority of
companies investigate consumer buying decisions to explore the needs of consumers and their
buying pattern such as where they buy, how and how much they buy, when they buy and why
they buy
...


MRCET MBA

FACTORS AFFECTING CONSUMER BEHAVIOUR
The marketers try to understand the actions of the consumers in the marketplace and the
underlying motives for such actions
...
These are:

The marketers try to understand the actions of the consumers in the marketplace and the
underlying motives for such actions
...
These are:
Psychological Factors: The human psychology plays a crucial role in designing the consumer‗s
preferences and likes or dislikes for a particular product and services
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Since the man is a social
animal who likes to be acceptable by all tries to imitate the behaviors that are socially acceptable
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Some
of the social factors are:



Family
Reference Groups
MRCET MBA



Roles and status

Cultural Factors: It is believed that an individual learns the set of values, perceptions,
behaviors, and preferences at a very early stage of his childhood from the people especially, the
family and the other key institutions which were around during his developmental stage
...
Several
cultural factors are:




Culture
Subculture
Social Class

Personal Factors: There are several factors personal to the individuals that influence their
buying decisions
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These are:







Personal Income
Family Income
Income Expectations
Consumer Credit
Liquid Assets of the Consumer
Savings

These are some of the underlying factors that influence the consumer behavior, and the marketer
must keep these in mind, so that appropriate strategic marketing decision is made
...
A product meets the needs of a consumer and in addition to a tangible value this
product also has an abstract value
...
In order to shape this abstract value, Philip Kotler
uses five product levels in which a product is located or seen from the perception of the
consumer
...
The
customer will only be satisfied when the specified value is identical or higher than the expected
value
...
Core Product: This is the basic product and the focus is on the purpose for which the product
is intended
...
The more
important benefits the product provides, the more that customers need the product
...
This will benefit the product positioning within a
market and effect the possible competition
...
Generic Product: This represents all the qualities of the product
...

3
...
That coat should be really warm and protect from the weather and the wind and be
comfortable when riding a bicycle
...
Augmented Product: The Augmented Product refers to all additional factors which sets the
product apart from that of the competition
...
Is that warm coat in style, its colour trendy and made by a well-known fashion brand?
But also factors like service, warranty and good value for money play a major role in this
...
It‗s the translation of the desire
that is converted into reality
...
Potential Product: This is about augmentations and transformations that the product may
undergo in the future
...

MRCET MBA

Competition
The competition between businesses focuses mainly on the distinctiveness of the Augmented
Product according to Philip Kotler
...
He states: “Competition is determined
not so much by what companies produce, but by what they add to their product in the form of
packaging, services, advertising, advice, delivery (financing) arrangements and other things that
can be of value to consumers”
...

Under the guise of stagnation means decline, innovative companies such as Philips and
Volkswagen focus on the latter category
...
The more efforts production
companies make at all levels, the more likely they are to stand a chance to be distinctive
...
This makes it increasingly difficult for a consumer to
define the distinctiveness of a product
...
This is not
just about satisfying the customers and exceeding their expectations but also about surprising
them
...

Your business can use these buying habits to design your marketing efforts for a clearly defined
target audience
...
Although these classifications are named as types of
products, focusing on how your customers buy these goods is equally important as you classify
products and develop your marketing campaigns
...
Soap, condiments and toothpaste are common examples of convenience
goods
...
Making your convenience goods available for impulse
or emergency purchases can be particularly effective
...
Another
version is to place umbrellas, boots or snow shovels near a store exit when sudden weather
changes call for them
...
Shopping Goods
Buying decisions are detailed considerations of price, quality and value for products classified as
shopping goods
...
Successful marketing of your shopping goods can come from positioning as a
better buy than your competitors -- for example, presenting better value with higher quality for
the price or vice versa
...

2
...
Examples include stereos, computers,
cameras and the most high-end brands of cars and clothing
...
Buyers for your
specialty goods generally spend more time seeking the product they want than on comparing
brands or products to make a value decision
...

3
...
Examples include batteries or life
insurance
...

Marketing your unsought goods will likely be most effective with lots of advertising and
salespeople promoting the idea of unresolved need for your unsought products
...
These different products can
target customers of varying ages, incomes and tastes
...
A product range is a set of variations on a specific
product made to appeal to different market segments
...
Advantages of Product
Range
Companies that offer a product range work on variations of a theme
...
When a company develops a strong core product line, the product range allows the
company to focus on those product lines while still offering enough variety in size, color, taste or
functionality to appeal to a wide range of potential customers
...
Small businesses can follow the example by offering a product range on their
specialty items
...
Each dish may have different seasonings and different portion
sizes, but the core product remains the same
...
The primary advantage of a product mix is that
it provides the company with additional opportunities to reach customers
...

Product Mix Examples
Companies can earn customer loyalty with a strong product mix
...
For instance, a manufacturer of athletic apparel can encourage customers to buy its shoes,
socks, workout wear, baseball caps and golf shirts
...


PRODUCT LINE
A product line is a group of products that are closely related to each other by function, customer
group, market, or price range
...
We'll use the idea of a national coffee chain
...
For example, the product
lines may consist of espresso, cappuccinos, lattes, mochas, café au lait, regular auto-drip coffee,
and various signature coffee drinks that were created by the company
...


MRCET MBA

PRODUCT LIFE CYCLE
As consumers, we buy millions of products every year
...
Older, long-established products eventually become less popular, while in contrast, the
demand for new, more modern goods usually increases quite rapidly after they are launched
...

Product Life Cycle Stages

Product Life Cycle Stages Explained
The product life cycle has 4 very clearly defined stages, each with its own characteristics that
mean different things for business that are trying to manage the life cycle of their particular
products
...
The size of the market for the product is small, which means sales are
low, although they will be increasing
...

Growth Stage – The growth stage is typically characterized by a strong growth in sales and
profits, and because the company can start to benefit from economies of scale in production, the
profit margins, as well as the overall amount of profit, will increase
...


MRCET MBA

Maturity Stage – During the maturity stage, the product is established and the aim for the
manufacturer is now to maintain the market share they have built up
...
They also need to consider any product modifications or improvements to the
production process which might give them a competitive advantage
...
This shrinkage could be due to the market becoming saturated (i
...

all the customers who will buy the product have already purchased it), or because the consumers
are switching to a different type of product
...


NEW PRODUCT DEVELOPMENT
New product development (NPD) is the process of bringing a new product to the marketplace
...

Innovative businesses thrive by understanding what their market wants, making smart product
improvements, and developing new products that meet and exceed their customers' expectations
...
They may be
completely original products, or existing products that you have modified and improved
...
New businesses, sole traders or even freelancers can
forge a place in the market by researching, developing and introducing new or even one-off
products
...
You can also consider
purchasing new products through licensing or copyright acquisition
The eight stages or process or steps involved in the development of a new product are listed and
also hyper-linked as follows:
1
...

3
...

5
...

7
...


Idea generation
...

Concept testing
...

Product development
...

Commercialization
...


MRCET MBA

Now let's discuss each stage in the process of a new-product development
...
Idea generation
The first step in new-product development is idea generation
...

Inviting suggestions from consumers
...

Brainstorming suggestions for new-product ideas
...
, national and international markets for newproduct ideas
...

Studying the new products of the competitors
...
Idea screening
Most companies have a "Idea Committee
...

They select the good ideas and reject the bad ideas
...
This step is necessary to avoid product failur

MRCET MBA

3
...
It is different from test marketing
...
They are given full information about the new
product
...
They are asked whether they
like the new product or not
...
If most of the consumers like the product, then business analysis is
done
...
Business analysis
Business analysis is a very important step in new-product development
...
The company finds out whether the new product is commercially profitable or
not
...










Whether the new product is commercially profitable or not?
What will be the cost of the new product?
Is there any demand for the new product?
Whether this demand is regular or seasonal?
Are there any competitors of the new product?
How the total sales of the new product be?
What will be the expenses on advertising, sales promotion, etc
...
If the new product is
profitable, it will be accepted else it will be rejected
...
Product development
At this stage, the company has decided to introduce the new product in the market
...
The production department will make
plans to produce the product
...
The finance department will provide the finance for introducing the new product
...
However, all this is
done as a small scale for Test Marketing
...
Test marketing
Test marketing means to introduce the new product on a very small scale in a very small market
...
However, if
the product fails in the test market, then the company finds out the reasons for its failure
...
If the new
product fails again the company will reject it
...
It is a safety device
...
It must be done especially for costly products
...
Commercialization
If the test marketing is successful, then the company introduces the new product on a large scale,
say all over the country
...
It produces
and distributes the new product on a huge scale
...

8
...

It must answer the following questions:








Is the new product accepted by the consumers?
Are the demand, sales and profits high?
Are the consumers satisfied with the after-sales-service?
Are the middlemen happy with their commission?
Are the marketing staffs happy with their income from the new product?
Is the Marketing manager changing the marketing mix according to the changes in the
environment?
Are the competitors introducing a similar new product in the market?

The company must continuously monitor the performance of the new product
...


MRCET MBA

UNIT III
MARKET SEGMENTATION
Market segmentation is the process of dividing up mass markets into groups or segments with
similar needs and wants
...

Customer segmentation is imperative when trying to send messages to a target market
...

Additionally, by reaching niche groups of people, marketers can craft messages specifically for
them
...

There is an excess of ways to segment the market in order to reach the most ideal consumers for
certain products or services
...


Customer Segmentation: Geographic
Geographic segmentation is the practice of segmenting a campaign‗s target audience based on
where they are located
...

Geographic segmentation is useful for both large and small businesses alike
...
For example, Home Depot may target US northeastern states when
advertising a sale on snow shovels
...

Particularly for small businesses, geographic segmentation can be used to target specific
customers without wasting excess advertising dollars on impressions that will not turn into leads
...

Geographic segmentation is one type of customer segmentation that is extremely easy to
implement, as many companies often have their customers‗ addresses from landing pages, or
their credit cards
...
Characteristics often include, but are certainly not limited to: race, ethnicity, age,
gender, religious, education, income, marital status, and occupation
...

Luxury brands may choose to market to a demographic consisting of people with household
income > $200,000
...

Demographic segmentation is even more efficient when targeting multiple segments at once
...
Targeting several
segmentations in conjunction with one another led to over 440 sales for the local furniture
retailer, driving more than $180,000 in revenue
...


Customer Segmentation: Demographic B2B
Demographic segmentation can also be used in B2B markets
...

Agencies may choose to segment the market by industry when searching for prospective clients
...

They can further segment the market by role when opting to contact marketing managers and
creative directors
...


Customer Segmentation: Psychographic
Psychographic segmentation is far less concrete than both geographic and demographic customer
segmentation, as the characteristics used to segment are less ―tangible‖ than the latter two
...

This type of customer segmentation is significantly more difficult to implement than geographic
or demographic segmentation
...
This includes
clearly defining the ideal buyer persona for the product or service and developing relationships
with the customer base
...

These people value a good deal and tend to be smart shoppers
...

Discount stores, like Wal-Mart, utilize this tactic nicely
...


Customer Segmentation: Behavioral
Behavioral segmentation is similar to psychographic segmentation on the basis that it is less
concrete than demographic or geographic segmentation
...

Behavioral segmentation can be used in a variety of ways
...

When segmenting based on occasions, companies can target consumers who are less price
sensitive during times like graduation season and the holiday season
...

Read more on behavioral segmenting here
...
Reach even more specific niche
markets by combining different segmentation styles
...
The tactic can benefit marketers in both small
business start-ups and global companies across all industries
...


REQUIREMENTS FOR EFFECTIVE SEGMENTATION
There are many ways to segment a market, but not all segmentations are effective
...
But hair color
MRCET MBA

obviously does not affect the purchase of salt
...

To be useful, market segments must be
1
...

Certain segmentation variables are difficult to measure
...
5 million left handed people in the United States, which is nearly the entire population of
Canada
...

The major problem may be that the segment is hard to identify and measure
...
S
...
Private data companies keep reams of statistics on other demographic
segments but not on left-handers
...
Accessible: The market segments must be effectively reached and served
...
Unless this group lives or shops at certain places and is exposed to certain
media, its members will be difficult to reach
...
Substantial: The market segments are large or profitable enough to serve
...
It
would not pay, for example, for an automobile manufacturer to develop cars especially for
people whose height is greater than seven feet
...
Differentiable: The segments are conceptually distinguishable and respond differently to
different marketing mix elements and programs
...

5
...
For
example, although one small airline identified seven market segments, its staff was too small to
develop separate marketing programs for each segment
...
Segment Size and Growth

MRCET MBA

The company must first collect and analyze data on current segment sales, growth rates, and the
expected profitability for various segments
...
But ―right size and growth‖ is a relative matter
...

Smaller companies may lack the skills and resources needed to serve larger segments
...
Such companies may target segments that are smaller
and less attractive, in an absolute sense, but that are potentially more profitable for them
...
Segment Structural Attractiveness
The company also needs to examine major structural factors that affect long-run segment
attractiveness
...
The existence of many actual or potential substitute products may limit
prices and the profits that can be earned in a segment
...
Buyers with strong bargaining power relative to sellers will try to force
prices down, demand more services, and set competitors against one another—all at the expense
of seller profitability
...

3
...
Some attractive segments can be dismissed quickly
because they do not mesh with the company‗s long-run objectives
...
For example, given the current
economic conditions, the economy segment of the automobile market is large and growing
...
A company should enter only segments in which it can create
superior customer value and gain advantages over its competitors
...
Target markets consist of
consumers who exhibit similar characteristics (such as age, location, income, and lifestyle) and
are considered most likely to buy a business's product or service
...

It is important for a business to identify and select a target market so it can direct its marketing
efforts to that group of customers and better satisfy their needs and wants
...
It allows for better understanding of customers and therefore enables the
creation of promotional materials that are more relevant to customer needs
...

Target markets or also known as target consumers are certain clusters of consumers with similar
or the same needs that most businesses target their marketing efforts in order to sell their
products and services
...

Demographic/socioeconomic segmentation – Gender, age, wage, career, education
...

Behavioral segmentation – (occasions, degree of loyalty)
Product-related segmentation – (relationship to a product)

Market segmentation divides the market into four main sub categories – demographic,
geographic, psychographic and behavioral segmentation
...
To aim at the small target
market, this is easy to formulate the special marketing strategy
...
Through market segmentation, the enterprise will be able to
notice every subdivision market purchasing potential, satisfying degree, competition and
comparative analysis, to better meet market needs
...
Through market segments, after select the suitable target
market, enterprises can focus more on human, financial, and material resources, to fight for the
advantages of local market, and then to occupy their own target market
...
Segmentation has
been an essential part of marketing since industrial development induced mass production,
particularly in manufacturing
...
However, as manufacturing processes became more variable, and
consumer demand diversified, businesses needed to respond by segmenting the market
...
Since being introduced by Wendell R
...

Smith stated: "market segmentation involves viewing a heterogeneous market as a number of
smaller homogeneous markets, in response to differing preferences, attributable to the desires of
consumers for more precise satisfaction of their varying wants" (Wedel & Kamakura, 2012)
...
The aim of market segmentation for businesses is to gain a competitive advantage by having
a better understanding of a specific segment than its competitors
...
After identifying each different group, Black and Decker then designed one
separate power tool range for each segment, based on their characteristics
...









Demographic segmentation: It refers to aspects of a market such as age, gender, race,
occupation and education
...
"Demographic segmentation almost always plays some role in a
segmentation strategy" (Thomas, 1980), and is often paired with other segments to create
a slightly more specific segment
...
Certain brands only target working professionals whereas others might only
target people who are at high school
...
This could be divided into
countries, cities, towns and neighborhoods etc
...
For example, marketers could target tractors specifically
towards rural areas where there are likely to be a number of farmers who operate tractors
...

Psychographic segmentation relates to dividing a market based on how they live their
everyday lives
...
S
...
According to Boote (1984), a popular
psychographic segment in marketing is personal values
...
One being – "spending no more money
than is necessary…even if it means not buying the best
...
" By learning about these orientations, the marketer is able to gauge different
attitudes of the consumers potentially being targeted
...
Consumers behave differently depending on occasions and the
frequency of usage of a product
...
"Many Marketers believe that behavior variables are the best starting points for
building market segments" (Tatum, 2007)
...
Segmenting
markets aims to increase sales, market share and profits by better responding to the desires of the
different target customer groups
...
[2] Markets can generally be
segmented according to four main variables: demographic, geographic, psychographic and
behavioral characteristics
...
[9] Buyer groups can be divided into the following: those loyal to the
brand, those who buy your brand but also buy from competing brands, those who buy more than
one competing brand, those who are regularly loyal to another brand, and new users who are
entering for the first time or re-entering
...

Demographic: Demographic segmentation is the process of dividing the total market according
to particular characteristics such as age, gender, family size, family life cycle, income,
occupation, education, religion, race, and nationality
...
Demographics are useful and
widely used but should be coupled with other segmentation variables to effectively define a
target market
...

Age: Consumers of different ages have different demand characteristics
...

Income: Lower income and higher income consumers will be quite different in product
selection, leisure time arrangement, social communication and communication and so on
...
For example, farmers prefer to buy load-carrying bicycles while
students and teachers love light, beautiful style bikes
...
These are newly married, full nest, empty nest and lonely
...


Geographic: Geographic segmentation is the process of dividing the total market according to
geographic location, for instance region (urban, suburban, rural, city size), climate and land type
...
For instance, an ice cream shop would be more likely to start
up in a hot location than a cold climate
...

Psychographic:
Psychographic segmentation is based on personality characteristics, mainly includes the
consumer's personality, the life style, the social class, the motive, the value orientation
...
These variables are concerned with why
people behave the way they do and are often used effectively in conjunction with other
segmentation variables
...

Values and culture are strongly linked to how people think and behave and are important aspects
of segmentation variables, especially in global campaigns
...

Lifestyle: Lifestyle is a particular habit of individuals or groups in the consumption, work and
entertainment
...
Today, many consumers does not only buy goods to meet
the material needs, it is more important to show the performance of their lifestyle, to meet the
psychological needs, such as identity, status, and the pursuit of fashion
...
Philip Kotler divided American society into six classes
...

Lower uppers: The extraordinary vitality in the occupation or business and get higher
income or wealth
...

Lower middles: Middle-income white-collar and blue collar workers
...

Lower lowers: The poor often rely on long-term unemployment, or public charity relief
to the people
...
[10]

Personality: Personality refers to the individual's unique psychological characteristics, these
psychological characteristics of individuals and their environment to maintain a relatively
consistent and lasting response
...
To distinguish between different personality, there is a strong correlation between the
premise and specific personality with the product or brand choice, so personality can become the
market segments of the psychological variables
...
Identifying what
customers want from products and the benefits they seek are important to behavioral
segmentation to allow marketers to better design and select products that satisfy these needs
...

















Opportunity: It is the time consumers buy and use the product
...
It will help improve brand usage and marketing
targeted
...

Benefit: Benefit segmentation is a kind of classification method based on the different
interests of consumers from the brand products
...

User status: According to the state of use, consumers can be classified into once users,
nonusers, potential users, the primary user, occasionally users and often user type, for
different type of consumers the brand should use different marketing strategies and
methods
...

Brand loyalty: Consumer loyalty is the most valuable wealth of enterprises
...

True Friends: They are the highest level of the four types and the most important part of
the customer group
...
These loyal
customers will be free of charge to the brand, and continue to recommend to others
...

Butterflies: Butterflies are not particularly loyal, but have spent money on your products
and brought in good revenue
...

Barnacles: Here is where some companies, especially B2B companies, find a surprising
amount of their customer base falls into
...
A great
example would be a customer that buys one cup of coffee at your coffee shop, and then
comes in every day for the next month to use your free Wi-Fi without making a purchase
...

Generally speaking, enterprises should avoid targeting strangers, because they will never
become a sincere customer, they have little contribution to the development of
enterprises
...
These categories or segments are demographic, geographic, psychographic,
psychological and behavioral (market segmentation)
...
It realises that
individuals have different motivations, desires, lifestyles and tastes
...
By targeting individuals with similar characteristics,
management can create an effective marketing plan for their targeted buyers
...

Demographic
Demographic segmentation is the division of the market based on an individual's sex, age,
income and life style
...
This is possibly because of the ability to easily collect
this kind of information
...

Demographic segmentation has been challenged with scholars stating that demographic
segmentations such as age and sex are poor behavior predictors
...

Geographic
Geographic segmentation is the division of the market based on an individual's location
...
Geographic segmentation can be used to compare certain habits and characteristics of
different locations
...


Psychological
Psychological segmentation is the division of the market based on an individual's personality,
attitudes and interests
...
Segmenting the market based on personality has been met with
controversy
...
Psychological studies have seen trends in certain traits displayed by
individuals
...
In contrast, those portraying low self-esteem were easily
influenced
...
This kind of research can prove beneficial to a company segmenting their target market
psychologically
...
Behavioral segmentation relates to a consumer's brand loyalty, usage rate and usage
situation, to name a few
...
Many marketers believe the best starting point for
MRCET MBA

constructing market segmentation is behavioral segmentation
...
Businesses can use an
individual's reaction to price drops, technology changes and product status to determine how to
market their product or service effectively
...
Analyze the features of your products and services
...
Make
a list of those features and needs to make the analysis easier
...
Look at the types of customers who are likely to purchase your products and use your services
...
Identify which customer categories have the greatest need for
your products
...
Consider the personal characteristics of your potential customers and determine how the
customer‗s lifestyle affects a need for your products
...
Consider how and when your customer will use your services, as well as
the features that appeal to the customer
...
Look at your competition‗s target market
...
Identify the areas of the market that have been overlooked by the
competition
...

5
...
Identify the
products or services that interest your current customers and determine what benefits these
customers get from those services
...
Compile all of your research findings
...
Keep the market well-balanced so that your
target market is not too big or too small
...
In order to position products or brands,
companies may emphasize the distinguishing features of their brand (what it is, what it does and
how, etc
...
) through the marketing mix
...


MRCET MBA

Positioning is one of the most powerful marketing concepts
...
Schaefer and Kuehlwein extend the concept beyond material and
rational aspects to include 'meaning' carried by a brand's mission or myth
...
Positioning is now a
regular marketing activity or strategy
...

Positioning is part of the broader marketing strategy which includes three basic decision levels,
namely segmentation, targeting and positioning, sometimes known as the S-T-P approach:
The STP approach highlights the three areas of decision-making
Segmentation: refers to the process of dividing a broad consumer or business market,
normally consisting of existing and potential customers, into sub-groups of consumers
(known as segments)
Targeting: refers to the selection of segment or segments that will become the focus of
special attention (known as target markets)
...


POSITIONING STRATEGY
A clear understanding of the market includes target demographics, strength of the competitors'
products, how you give value, and your own strengths and weaknesses
...


1
...
Products are designed to appeal to a specific
demographic group
...
For example, Telemundo is a Spanish language television network
that offers programming to Latino and Hispanic customers
...


2
...
If a company can convince consumers that
they are receiving more value for their money, they will buy the product
...
For example, a car manufacturer might offer a lower price in exchange for a smaller
engine and fabric upholstery instead of leather
...
99
...


3
...
However, to create this perception in the mind of the consumer, the company must focus
its advertising on how its features and benefits are superior to those of its competitors
...
As a result, Five Guys is able to charge higher
prices, and people will stand in line to pay
...
Distribution
Companies can create the perception of better value by restricting the distribution of their
products
...


5
...
This strategy is helpful when a market has two strong competitors
...

Marketers must determine where and how to position their products in the marketplace
...
How significant is the price? Do
consumers perceive that the product has sufficient value to justify paying a higher price -- or do
they simply want the lowest price possible? These are all questions that a marketer must answer
to have a successful positioning strategy
...
The main
elements of total physical distribution costs of a product are transportation, warehousing inventory
carrying receiving and shipping packaging administration and other processing
...


Objectives: Hitting the right goods to the right places at the right time for the least cost
...

Minimum distribution cost implies cheap transportation, low stocks and few warehouses
...
The possible time required from the data of receipt of an order up to the data of dispatch of
goods most is reasonable & as start as possible
...

Inventory management: - Inventories are reservoirs of goods held in anticipation promptly,
inventories are kept to meet market demands promptly, inventory means, money is held temporarily
in the form of raw materials component parts supplies in process goods and finished goods, 20% to
30% of the total assets of a firm are locked up-inventory
...
Little handling involves moving, packaging, storing, all the materials used by the firm
with the development of technology a variety of material handling requirements have been developed
to economic the cost reduce the effort of workers improve the safety for men & materials
...
The choice of transportation carries affects the pricing of products,
delivering performance and condition of the goods when they arrive all of which will affect customer
satisfaction
...
The company can choose
among 5 transportation models: trail, truck, water, pipeline and air
...

Promotion: Developing and speeding persuasive communication about an offer
...

Negotiation: Reaching an agreement on price and other terms of the offer so that ownership or
possession can be transferred
...

Matching: Shaping and fitting the offer to the buyer‗s needs, including activities such as
manufacturing, grading, assembling and packing
...

Risk taking: Assuming the risks of carrying out the channel work

Factors of distribution channel:







Nature of market
Nature of product
Buying habits of the customer
Competition
Financial resources
Channel cost

Role of Distribution channel: Besides making the product available to the customer,
middlemen perform several other roles and functions
...

1
...
Developments like changes in customer demography, psychograph, media habits and
the entry of a new competitor or a new brand and changes in customer preferences are some of the
information that all manufacturers want
...

2
...
Many a time the middlemen absorb an increase in the price of the products and continue to
charge the customer the same old price
...
The
middlemen also maintain price stability by keeping his overheads low
...
Promotion: Promoting the product/s in his territory is another function that middlemen perform
...

4
...
The payment is in advance even
though credit may be extended by the manufacturer, because it has to be made even before the
products are bought, consumed and paid for by the ultimate customer
...
Title: Most middlemen take the title to the goods, services and trade in their own name
...
This also enables middlemen to be in
physical possession of the goods, which in turn enables them to meet customer demand at the very
moment it arises
...

Producer --> Retailer --> Consumer
Retailers, like Walmart and Target, buy the product from the manufacturer and sell them directly to
the consumer
...
Since consumers need more time with these items before they
decide to purchase them, it is in the best interest of the manufacturer to sell them to another user
before it gets into the hand of the consumers
Producer --> Wholesaler/Distributor --> Customer
Wholesalers, like Costco, buy the products from the manufacturer and sell them to the consumer
...
By buying the items
in bulk from the wholesaler the prices of the product are reduced
...

Producer --> Agent/Broker --> Wholesaler or Retailer --> Customer
This distribution channel involves more than one intermediary before the product gets into the hands
of the consumer
...
Agents come into play when the producers need to get their product into
the market as quickly as possible
...

Introduction: Direct marketing is a type of advertising campaign that seeks to elicit an action (such
as an order, a visit to a store or Web site, or a request for further information) from a selected group
of consumers in response to a communication from the marketer
...
Customer response should be measurable: for example, the marketer
should be able to determine whether or not a customer offered a discount for online shopping takes
advantage of the offer
...
" Explain
...
" Now let's take this statement apart and see what it means
...
Personal selling requires
the seller and buyer to get together
...

Whereas advertising is non-personal selling
...
Advertising has none of the advantages of personal selling, very little
time to present sales message, message is cannot be changed easily
...
Communication uses all the senses like smell, touch, taste, sound, sight
...
In advertising, what appears is everything the writer
thinks the customer needs to know about the product in order to make a decision about the product
...

Paid For: Advertiser has to pay for the creation of ad and for placing it in the media
...
Cost of advertising depends on TRP of
media, reach of media, and frequency of ad to be displayed
...
The basic purpose
of advertising is to identify and differentiate one product from another in order to persuade the
consumer to buy that product in preference to another
...
There are two reasons for this: first, it's a legal requirement, and second, it makes good
sense
...
By doing so the sponsor not only
fulfils the legal requirements, but it also makes a good sense, if the sponsor doesn't do so, the
audience may believe that the ad is for any competitor's product, thus wasting all the time and money
in making and placing the ad

Functions of Advertising 1
...

2
...

3
...

4
...

5
...

6
...
When
demand is there and the product is available, automatically the overall cost will decrease,
simultaneously the costs of sales like distribution cost, promotional cost also get decreased
...




Persuasive advertising: This type of advertising persuades or motivates the prospective
buyers to take quick actions to buy the products or services of the firm
...


MRCET MBA



Reminder advertising: This genre of advertising reminds the existing customers to
become medium or heavy users of the products or services of the firm that have been
purchased by them at least once
...


B) Classification on the basis of region
Advertisements can also be classified on the basis of the region, say:




Global advertising: It is executed by a firm in its global market niches
...
Cable TV channels are also used to advertise the products through out world
...

National advertising: It is executed by a firm at the national level
...
Examples: BPL (Believe
in the best)
...




Regional advertising: If the manufacturer confines his advertising to a single region of
the country, its promotional exercise is called Regional Advertising
...
Examples: Advertisements of
regional newspapers covering those states or districts where these newspapers are
circulated
...
g
...




Local advertising: When advertising is done only for one area or city, it is called Local
Advertising
...
It is sometime done by
the retailer to persuade the customer to come to his store regularly and not for any
particular brand
...


C) Classification on the basis of target market
Depending upon the types of people who would receive the messages of advertisements, we can
classify advertising into four subcategories:


Consumer product advertising: This is done to impress the ultimate consumer
...
This
type of advertising is done by the manufacturer or dealer of the product or service
...




Industrial product advertising: This is also called Business-to-Business Advertising
...

It is directed towards the industrial customer
...
Different media are chosen by each manufacturer according to
his product type, nature of distribution channel, and resources at his command
...




Professional advertising: This is executed by manufacturers and distributors to
influence the professionals of a particular trade or business stream
...

Manufacturers of these products try to reach these professionals under well-prepared
programmes
...




Financial advertising: Banks, financial institutions, and corporate firms issue
advertisements to collect funds from markets
...


D) Classification on the basis of desired responses
An ad can either elicit an immediate response from the target customer, or create a favorable image in
the mind of that customer
...
Thus, we have two types of
advertising under this classification
...
Examples: Season's sale, purchase coupons in a magazine
...
After getting the advertisement he
does not rush to buy the product but he develops a favorable image of the brand in his
mind
...
In this type of
Promotional effort, the marketer promotes a different product
...
The firm is promoting Bagpiper Whisky, but intentionally
shows soda
...
Aap
...


E) Classification on the basis of the media used in advertisement
The broad classification based on media is as follows:

MRCET MBA



Audio advertising: It is done through radio, P A systems, auto-rickshaw promotions, and
four-wheeler promotions etc
...




Audio-visual: It is done through cinema slides, movies, video clips, TV advertisements,
cable TV advertisements etc
...




Internet advertising: The World Wide Web is used extensively to promote products and
services of all genres
...
teleshop
...
asianskyshop
...




Verbal advertising: Verbal tools are used to advertise thoughts, products, and Services
during conferences, seminars, and group discussion sessions
...


Advertisement management process-5Ms
1
...
There may be more than one mission: a single campaign can aim to increase
sales, improve brand awareness, and develop brand loyalty
...

2
...

But for an advertising campaign to give useful metrics on return-on-investment, it‗s important to
establish an advertising budget ahead of time, and stick to it
...
Any expenses incurred should be calculated to pay for
themselves in terms of increased sales, so understand the product and budget accordingly
...
Message: The message is the memorable part of your advertising campaign: ensure you create a
tagline and tone which is geared to the target market
...
Consider hiring a creative agency to work with you in creating relevant,
engaging messages that can be adapted across all media channels
...

4
...

MRCET MBA

Different media channels include internet (encompassing banner ads, videos, email marketing and
more), television, print, and radio
...
Measurement: The measurement section assesses the reach of the campaign‗s core mission, and
analyses whether each section of media being used is contributing to this goal

Managing the sales force
...

Prospecting – search for leads
Targeting – allocation of time between prospects and customers
Communicating – info about company and products
Selling – Approach, presentation, answering objections, closing sales
Servicing – consulting, technical, financing, etc
...


Sales Force Strategy



Ways sales reps work with customers to maintain company competitive edge:
Rep to buyer – discuss issues with a prospect or customer



Rep to buyer group – rep gets to know as many members of buyer group as possible



Sales team to buyer group –



Conference selling – company sales rep and resource group to customer to talk big
problems or opportunities
Selling Seminar – Company team to group of buyers/customers




Once company has strategy can go with direct sales force or contractual force
...


Sales Force Structure



Territorial – each rep gets own piece of land to work equally divided by workload or
potential – result is no customer confusion as to who the rep is
Product – generates specific product knowledge

MRCET MBA



Market – industry or customer type delineation



Complex – combination

Sales Force Size









Depends upon the of customers you want to reach then:
Group customers into classes by annual sales volume
Establish desired call frequency
Classes size time freq
...
Straight salary provide reps secure income, reps more willing to do non selling
activities, reps have less incentive to overstock customers, lower company
administrative activities and lowers turnover
...
Straight commission attracts higher sales performers, provides more
motivation and requires less supervision, while controlling selling costs
...
Determine what you want your sales people to be like
2
...
Select the best applicants
4
...


MRCET MBA

Supervising the Sales Force



Develop norms for customer calls – and how much sales volume should be
generated per call
Develop Norms for prospect calling – needed to motivate reps to look for new
business Ensuring efficient use of time and assets – direct supervision or training
Motivating Sales Reps – often not too difficult as sellers are usually self
motivated
...
All three
are linked
...




Supplemental Motivators – sales meetings and contests provide social occasion to
meet, share ideas and accomplishments, or get extra effort from the force
...


Formal evaluation


Current to past Sales performance – did you sell more or less, and of what product
...
Principals of
Personal Selling



Prospecting and Qualifying – the art of finding good leads – cold calls to asking
current customer for names to joining professional organizations
Pre-approach – learn about the prospects business and decided the best approach to take



MRCET MBA



Approach – know how to get off to a good start/get a foot in the door Presentation get
the customers interest, show benefits and features o use canned approach formulated
approach – uses buyers needs and desires to pull out the right formula to use in the
presentation need satisfaction approach – listen and then use problem solving skills to fix
customers problems



Overcoming Objections – Psychological or logical – sales rep must handle any type
...
Both types may require
negotiation skills
...
Builds both rep and company reputations

Advertisements are meant for the masses and people relate themselves with this medium
...

Positive and Negative Aspects of Advertising: As like any other medium of mass communication,
advertising also have positive as well as negative aspects
...
Advertising is the largest financial source for mass
media
...
Many of the advertisements are
criticized as deceptive or manipulative
...


Ethics in Advertising: Ethics means a set of moral principles which govern a person's behavior or
activities
...

Advertising benefits advertisers in many ways; similarly it makes the public aware with the available
brands so that they can make informed choice among the available products or brands
...
Ethical ad is one which is in the limit of decency, make no false claims, and
doesn't lie
...

Ethical and Moral principles of Advertising: Advertisers must have sufficient knowledge of ethical
norms and principles, so that they can understand and decide what is correct and what is wrong
...
We are
speaking briefly of three as follows:1
...
The dignity of the human person; and

MRCET MBA

3
...

Truthfulness in Advertising: Truth in advertising promotes a highly efficient, functioning economy
by: Discouraging deceptive business practices; Encouraging the provision of accurate and truthful
information; Enhancing competition by ensuring a level playing field; and Enabling informed
consumer choice
...

Advertisers should have a deeper sense of social responsibility and should develop their own set of
ethical and social norms taking into consideration the values of their society
...

The clearer a firm‗s objectives, the easier it is to set price
...


The following are the price setting methods
...
Construction companies omit job bids by estimating the total project cost and
adding a standard markup for profit
...

Target return pricing: - Another cost oriented pricing approach is target return pricing
...
This pricing
method is also used by public utilities that are constrained to make a fair return on their investment
...
The key to
perceive value pricing is to accuracy determine the market‗s perception of the offer is value
...
They use
the non-price variables in the marketing mix to build up perceived value in the buyers‗ minds
...
The firm might change the same, more or less than its
major competitors
...
Where costs are difficult to measure or
competitive response is uncertain firms feel that the going rice represents a good solution
...
The
firm bases its price on expectations of who competitors will rice rather than on a rigid relation to the
firm a costs or demand
...
The higher its sets its rice above the costs the lower its chance of getting the contract
...

MRCET MBA

Geographical pricing: - Geographical pricing involves company in deciding how to price its
products to customers located in different parts rice of the country
...
They are as follows
...

P Basic-point pricing
...

Promotional pricing: - Under certain circumstances, companies will temporality price their products
below the list price and sometimes even below cost promotional pricing takes several forms
...

Special event pricing: - This will be used by sellers in certain seasons to draw in more customers
...

Cash rebates: - consumers are offered cash rebates to get them to buy that manufacturer‗s product,
with in a specified time period
...

Low-interest financing: - This is another tool for stimulating sales without lowering the price
...

Warranties and service contracts: - The Company can promote sales by adding a free warranty
offer or serves contract
...

Discriminatory pricing: - Discriminatory pricing describes the situation where the company sells a
product or service at two or more prices that do not reflect a proportional deference in costs
...

Customer segment pricing: - Here different customer groups are charged different prices for the
same products or service museums will change a lower admission fee to students and senior citizens
...

Image pricing: - Some companies will price the same product at two different levels based on image
differences
...
A theater varies its seat prices because of audience references for curtain
locations
...

Product mix pricing: - Price-setting logic has to be modified when the product is a part of a productmix
...


Process of pricing decision making:





Setting the pricing objectives
Determine demand
Estimating cost
Analyzing competitive price




Selecting the price method
Select final price

Retailing, trends in retailing,
Introduction: Retailing includes all activities in selling goods or services directly to final customers
for personal and non business use
...

It would be very costly for consumers to locate, contact and make a purchase from a manufacturer
every time
...
It is the last activity of any selling strategy to earn
revenue Retailers also provide service and information back-up that makes buying less risky and
more fun in an environment ,Retailers may provide many extra services, from personal shopping to
gift wrapping to delivery, that increase the value of products and services to consumers Corporate
retailing helps for brand building

Classification of retailers based on:





Product type
Relative price
Control of outlets
Type of store cluster

Product Type



Specialty Stores
Departmental Stores
MRCET MBA







Supermarkets
Convenience Stores
Superstores
Combination stores
Hypermarkets

Specialty Stores:



Carry a typical type of products
With a deep assortment within that type



Specialty stores are flourishing increasing use of market segmentation, market targeting
and product specialization

Departmental Stores: Carries a wide variety of product types
...


MRCET MBA

Hypermarkets:
Hypermarkets combine discount, supermarket and warehouse retailing
...
They usually give discounts to customers who carry their own heavy appliances and
furniture out of the store


Relative prices
o Discount stores
o Off-price retailers
o Chain stores



Discount stores:



Sell standard merchandise at lower prices by accepting lower margins and higher volume



Occasional discounts or specials do not make a store a discount store, a true discount
store regularly sells its merchandise at lower prices, offering mostly national brands, not
inferior goods

Off-price retailers:


They obtain a changing and unstable collection of higher-quality merchandise, often
leftover goods, overruns, and irregulars at reduced prices from manufacturers or
other retailers
...
g
...
They
buy at less than regular wholesale and charge customers less than retail



Chain stores:
Are two or more outlets are commonly owned and controlled, employ central buying and
merchandising, and sell similar type of merchandise








Control of outlets
Corporate chain
Voluntary chain
Retailer cooperative
Franchise organization
Merchandising conglomerate

4
...
g
...
g
...

Introduction: In an economy like India where around 70% of the population lives in villages, Rural
Marketing as a subject is being accepted with open arms across B-Schools and Universities
...
The term, Rural Marketing, means different things to different people
...
One of the closest definitions of Rural Marketing
states Rural Marketing is the process of taking region specific goods and services to the rural market
leading to exchanges between urban and rural markets simultaneously satisfying consumer demand
and achieving organizational objectives
...
Increasing Population of India: The growth of Indian population to being the world‗s
second most inhabited country with 1
...

MRCET MBA

2
...
7 trillion economy with per capital income
soaring by 10
...

3
...
Department of Rural development
under the Ministry of Rural Development has initiated many schemes which has been
facilitating and boosting the growth of rural India
...

4
...

2
...
Consequently, there has been a
steadyriseinruralgrowth

---