(a) Explain the term Product item, Product line and Product mix in the

context of the above situation.

1.PRODUCT ITEM
-one   type  of  chair  is   a  product  item.  
Product line
A product line is "a group of products that are closely related, either because
they function in a similar manner, are sold to the same customer groups,
are marketed through the same types of outlets, or fall within given price
ranges.
- 42 different  designs  of  chairs is  called  the  product line.
====================================
PRODUCT MIX
the variety of product lines that a company produces, or that a retailer
stocks. Product mix usually refers to the length (the number of products in
the product line), breadth (the number of product lines that a company
offers), depth (the different varieties of product in the product line), and
consistency (the relationship between products in their final destination) of
product lines. Product mix is sometimes called product assortment.
THE  PRODUCT MIX  INCLUDES
-different  types  of chairs.
-different  varieties  of office  desks.
-carpets.
-safes.
-filing cabinets etc

(b) Advise the company in relation to its Product mix decisions and its
effects on the company's image.
THE  COMPANY  SHOULD  RATIONALIZE  THE  PRODUCT MIX,
IN ORDER  TO  
-reduce  the range.
-reduce  the stock  level.
-reduce the  stockholding  cost.
-reduce  the inventory cost.
-reduce  the warehousing  cost.
-reduce  the  interest  payment on  borrowings.
THE  COMPANY  SHOULD  MAINTAIN  THE  TOP
SELLING   PRODUCT  MIX,
-different  types  of chairs.[ TOP  25 VARIETIES, WHICH
PRODUCES  85%  SALES ]
-different  varieties  of office  desks..[ TOP  12  VARIETIES, WHICH
PRODUCES  85%  SALES ]
-carpets..[ TOP  6  VARIETIES, WHICH
PRODUCES  85%  SALES ]
-safes..[ TOP  5 VARIETIES, WHICH
PRODUCES  85%  SALES ]
-filing cabinets.[ TOP  8  VARIETIES, WHICH
PRODUCES  85%  SALES ]

Q2
b) Are intermediaries and their functions necessary aspects of marketing
channels? Give reasons

A marketing channel is a group of interrelated organization that directs the

flow of products from producer to ultimate customers. The channels are also
called marketing intermediaries. The two major categories of marketing
intermediaries are wholesalers and retailers. Wholesalers are individuals
and organizations that sell primarily of goods. Retailers specialize in selling
products to consumers. They generally resell products that they obtain form
wholesalers.

Consumers often wonder whether products would cost less if one or more
marketing intermediaries could be eliminated from the distribution system.
Would cars be less expensive if customers could simply buy them straight
from the manufacturer? Perhaps, but think about the practical aspects
involved. How many consumers would be willing or able to go to Detroit to
buy a car? Or maybe Japan? If manufacturers offered cars for sale by mail
order, how many consumers would buy one without seeing and test-driving
it? Carmakers selling vehicles directly to buyers from around the United
States or around the world would be impossible.

Marketing intermediaries are vital in creating place, time, and possession

utilities. They ensure that products are available on a timely basis where
they are needed. Eliminating intermediaries does not eliminate the need for
their services, such as storage, delivery, and providing a product
assortment. The manufacturer, the consumer, or some other organization
has to perform these essential services. Without intermediaries, most
consumer purchases would be much less efficient. Products probably would
cost more, not less.

A. There are hundreds of thousands of marketing intermediaries whose job

it is to help move goods from the raw-material state to producers and then
on to consumers.
1. MARKETING INTERMEDIARIES are organization that
assist in moving goods and services from producer to
industrial and consumer users.
a. They are organizations (formerly called
"middlemen") in the middle of a series of
organizations that join together to help distribute
goods.
b. A CHANNEL OF DISTRIBUTION is the whole series
of marketing intermediaries who join together to
transport and store goods in their path from
producers to consumers.
c. A WHOLESALER is a marketing intermediary that
sells to other organizations.
d. A RETAILER is an organization that sells to
ultimate consumers.
 2. CHANNELS OF DISTRIBUTION enhance communication
flows and the flow of money and title to goods.
3. The latest trend is to try to eliminate wholesalers and the
need for retail stores by selling over the Internet.
B. WHY MARKETING NEED INTERMEDIARIES
1. Manufacturers don’t always need marketing
intermediaries to sell their goods to consumer and
industrial markets.
2. Intermediaries perform certain functions better than most
manufacturers. These functions include transportation,
storage, selling, advertising, and relationship building.
3. Companies often outsource distribution to others.
4. BROKERS are marketing intermediaries who bring buyers
and sellers together and assist in negotiating an
exchange, but do not take title to the goods.
C. HOW INTERMEDIARIES CREATED EXCHANGE EFFICIENCY.
1. Intermediaries CREATE EXCHANGE EFFICIENCY by
decreasing the number of contacts needed to establish
marketing exchanges.
2. Not only are intermediaries more efficient, but they are
more effective than manufacturers.
3. Intermediaries were often better at performing their
functions than a manufacturer or consumer could be.
4. Recently, technology has made it possible for
manufacturers to reach consumers much more efficiently.
a. Some manufacturers reach consumers directly on
the Internet.
b. Retailers are now so closely linked with
manufacturers that they can get delivery several
times a day.
5. Wholesalers are not yet obsolete, but must change their
functions to remain viable.
D. THE VALUE VERSUS THE COST OF INTERMEDIARIES.
1. Some people think that if we could get rid of
intermediaries, we could greatly reduce the cost of the
things we buy.
2. The text uses the example of Fiberiffic to illustrate how
marketing intermediaries facilitate the movement of
goods.
3. Values discussed include: the value of not driving to
Michigan to buy a box of cereal, the value of saving time,
and effort by not having to drive to a wholesaler’s on the
outskirts of town.
4. The text emphasizes three basic facts about
intermediaries:
a. Intermediaries CAN BE ELIMINATED, BUT THEIR
ACTIVITIES CANNOT BE ELIMINATED.
i. Someone else still has to perform the tasks.
 ii. Today many activities are being performed on
the World Wide Web, and intermediaries ARE
being eliminated.
b. Intermediaries have survived in the past BECAUSE
THEY PERFORM FUNCTIONS MORE
EFFECTIVELY AND EFFICIENTLY THAN MOST
MANUFACTURERS.
c. Intermediaries ADD COSTS TO PRODUCTS, BUT
THESE COSTS ARE OFFSET BY VALUES THEY
CREATE.

Q-3 Write short notes on any three of the following:

a) Advertising and Publicity

Advertising buys its way into the media.

An advertiser purchases air time on a broadcast medium or page space in a

print medium and then uses that media time/space to deliver whatever
persuasive messages the advertiser chooses to the media's audiences.
Presumably, a smart advertiser will purchase ad space in only those media
whose audiences are known to be consistent with the target audiences the
advertiser wants to reach.

 Most often, advertising messages are inducements to purchase a

product.
 However, advertising space can be used for non-product oriented
messages.
o "Advertorials," for instance, are advertising messages which take
sides and present a specific view or opinion about public issues.
o "Image ads" are those which provide favourable information
about an organization and its policies that would not normally
be considered "newsworthy" enough for the media to report it of
their own volition.

The biggest advantage of advertising is that it gives the organization total

control of the message that will be presented to the audience. The
advertiser, not the media's editors, control the content, the timing, and the
amount of time/space given to the advertising.

The biggest disadvantages are the high price of advertising and the
scepticism with which audiences sometimes view advertising that they know
is unedited opinion of the advertiser.

Publicity is presented by the media because it's "newsworthy."

A publicity-seeker tries to "make the news" -- i.e., to convince

reporters/editors to present news coverage about a particular person,
organization, or event -- by saying or doing something that the news media
will choose to report of their own volition as part of their usual task of
informing the public. The publicity-seeker's intent is to gain free and
hopefully favorable editorial coverage. Other people and organizations who
are fearful of receiving negative or harmful publicity will employ public
relations practitioners to try to suppress or counteract negative media
coverage. Publicity-seekers are entirely at the mercy of the media's editors
and other staff members. The editors, not the individual or organization who
wants the publicity, decide whether or not anything will be reported in the
media. And, even when something is reported, it's the media staff who
decide how it will be reported and how much attention it will be given. It's
very possible that information which an organization offers the media in a
positive and flattering news release could show up in a news story that casts
a negative or critical light on the organization that supplied it. For years the
conventional wisdom was that the biggest advantages of publicity were the
lack of direct cost and the apparent "third-party endorsement" effect.

 It's not necessary to buy media space/time, but publicity is not totally
free. There are salary and production costs involved in having
someone prepare news releases or perform other publicity work.
 Media audiences often give information presented as publicity more
credibility than if the same information were presented in an ad.
That's because they know that presumably objective editors decide
what's included in the news whereas self-serving organizations decide
what to put in their ads.

This conventional wisdom was at least partially ratified in a 1994 landmark

study conducted by the Wirthlin Group that looked at the relative impact
which publicity and advertising have on consumers' buying decisions.
According to O'Dwyer's PR Services (Sept. `94), "Those surveyed reported
that a news article or feature in a newspaper or magazine would impact
their buying decisions more than ads for a product or service." More
specifically, 28 percent of the adults over age 18 said a news or feature story
would be likely to influence their decision to buy a specific product, while
only 8 percent said that an ad for the product would be likely to influence
their decision.

Alice Allen, president of the Allen Communications Group in New York

which helped fund the study, also pointed out that the relative impact of
publicity, particularly newspaper and magazine stories, was further
increased among respondents who had completed higher education and had
higher income levels.

On the other hand, the biggest disadvantages of publicity are the lack of
control over the specific content, the timing, and the amount of coverage.

Used together, ads and publicity can create a powerful synergy

In the past, most practitioners would select and use either advertising or
public relations to get their messages out depending on which seemed most
appropriate for the prevailing circumstances. In some instances, they may
have even used both, but it wasn't a common practice and there was no
evidence that pointed to it being particularly effective. In the last few years,
that's started to change.

During the 1990's AT&T studied the relative effectiveness of advertising and
media relations in helping to acquire new customers. Some of these findings
and others were recently published in a study by the Institute for Public
Relations (IPR) at the University of Florida. The general conclusion of that
study, as reported by pr reporter (7/16/01), was that news coverage,
whether generated through media relations efforts or not, "modulates the
impact of advertising." Most of the time, they work synergistically and
reinforce one another, but there are exceptions.

 The most common circumstances involve routine amounts of positive

or neutral news stories. In situations like this, complementary or
supporting advertising works with the news coverage to produce an
even more positive impact on public attitudes.
 The same is true when there is an unusually large amount of positive
news coverage. There's a more positive impact on public attitudes with
advertising than there is without it, but the added impact of the
advertising, while positive, is significantly less forceful in this type of
situation.
 On the other hand, when there is an unusual amount of negative
news coverage, "incremental advertising doesn't have a positive
incremental impact and may even have a negative one." Perhaps, and
this is only my speculation, this occurs because the audience
perceives the advertising as an attempt to overshadow or compensate
for the negative news. But, whatever the reason, the best suggestion
based on currently available evidence might be to reduce, not
increase, advertising during times when your organization is getting
bad press.

The best ways of using advertising and media relations to reinforce one
another remain to be determined. But, in the meantime, the IPR study
author Bruce Jeffries-Fox suggests, "that partnerships between media
relations and advertising would save money and pack a bigger punch. ...
Messages from both worlds combine in the minds of consumers."

Q.4. Briefly discuss the concept of positioning. What is the positioning

of PRODUCT  POSITIONING   IN   THE  SELECTED  MARKET
SEGMENT.

FIRST  STEP -- DO   THE  RESEARCH

The first step in the positioning process is to do the research. The good news
is that product marketing managers already have done most of the research
as part of their job. To successfully position a product, you need a thorough
understanding of customer problems, channel issues, and how competitors
are positioned. The answers to these and other questions become part of a
rationale document for your positioning strategy:
What is your target market (size, type of company, etc.)?
Who is the decision maker you want to target your message to, and what
keeps that decision maker awake at night?
What pressing problem does your product solve for your prospective
customer?
How is your prospect solving that problem today?
What specific benefit does your product deliver?
Why is your product better than the current solution and competitive
alternatives?
Who are your key competitors; why and when do you win or lose to them?
How do your competitors position themselves in their marketing
communications, including ads, direct mail campaigns, brochures, and web
sites?
What makes your product unique in a way that is relevant to your prospect?
Are there any problems, unique challenges, or special needs of your
channel?
What do prospects and customers like and dislike about your product?
Do prospects and customers share your belief of why your product is better
than the competition’s?
Are there any characteristics of a sales situation that indicate whether or
not your product or service will be selected?
Now incorporate the answers to these questions in a rationale document. By
doing so, all product knowledge is captured in one place and can be used as
a reference guide when marketing and sales need it. The rationale document
should be three to five pages and should include this information:
Product Category—Define the product’s key features, advantages, and
benefits. A matrix can help clarify these items.
Product Line Fit—Describe how the product fits into the overall company
product strategy.
Situation Analysis—Describe the conditions that justify the release of this
product, including why the company believes it can be successful.
Market Analysis—Profile target market(s) by size, revenue, market segment,
operational type, or other relevant categories.
Audience Analysis—Profile key prospects within the target market(s),
including job titles and functions (demographics) and their concerns,
attitudes, and behaviors (psychographics).
Distribution—Describe how the product will be distributed and the impact of
distribution on product communications.
Competitive Positioning—Describe the key competitors, their targets, and
how they position their products.
Positioning Statement and Rationale—Evaluate the product positioning
statement against the following four criteria: Is it important, unique,
believable, and usable?
Support Points—Describe how the three support points make the
positioning statement unique, believable, and important. If multiple markets
or audiences require unique support points, explain why.
A rationale document transfers important product knowledge to those who
need to know, but who don’t have the time or expertise to find the
information themselves. It’s especially useful when creating a product
message strategy that includes a positioning statement (number 8 in the
rationale document) and three or four support points (number 9).

A  MESSAGE  STRATEGY  IS   A   TIME  SAVER

Your positioning statement becomes the central idea and theme underlying
all marketing activities. It is a short, compelling, declarative sentence that
states just one benefit and addresses the target market's number one
problem. It must be unique, believable, and important, or the target market
will ignore the message. Once you have found the right message, your
product marketing managers won’t need to be involved in every planning
session for every marketing campaign.
Supporting benefit statements tell the story in more detail. They also provide
a structure for product demonstrations. While the positioning statement
articulates a high-level benefit, the claims made in the supporting
statements should be readily demonstrable. That is, in just a few steps, you
should be able to show how the product delivers concrete benefits.
Make sure your message strategy has enough detail to support the creation
of a standard product demonstration. This helps your product marketing
managers to create a demo quickly. And there’s another benefit—the
product detail in the support points answers a lot questions before
marketing and sales ask them.
A message strategy also facilitates delivery of the same message across all
marketing media, including web sites, brochures, advertisements, and
presentations to investors, industry analysts, and prospects. A standard
outline format makes it easy for writers and other communicators to see the
message strategy's benefit hierarchy, and to take full advantage of it.
=================================================
i) Santro Car
Product Category—small  car
Situation Analysis—small car -economy in  price-meets  the  market
criteria.
Audience Analysis—small  family / upmarket  income / modern  lifestyle/
seeks reliable transport.
Distribution—extensive distribution new car  distribution/  service  outlets.
Competitive Positioning—competitive  positioning  to  suzuki.
Positioning Statement and Rationale—comfortable  transport  at  the
affordable / economic price.
===========================================================
ii) Indian Airlines
Product Category—largest  domestic   air  service  company.
Situation Analysis—good service  /economical  price /meets  the  market
criteria.
Audience Analysis—commercial  traveller / upmarket  businessmen /
modern  lifestyle/ seeks reliable transport.
Distribution—extensive  network.
Competitive Positioning—near  monopoly.
Positioning Statement and Rationale—comfortable/ reliable  airservice   at
the  affordable/value  for  money.
===========================================================
iii) Pepsi
Product Category—cola.
Situation Analysis—affordable  / entertaining  cola  drink..
Audience Analysis—age  [ 12 - 35] group.
Distribution—extensive distribution, available  at  handy  distance  outlets.
Competitive Positioning—competitive  positioning  to  coca  cola..
Positioning Statement and Rationale—quench your thirst/ enjoy  a  drink at
the  affordable / economic price   .
===========================================================
iv) Dalda Ghee (Edible oil)
Product Category—edibe  oil
Situation Analysis—easy  to use -economy in  price-meets  the  market
criteria.
Audience Analysis—women [ 15--55] group
Distribution—extensive distribution from  all  grocery   outlets.
Competitive Positioning—competitive  positioning  to  all  cooking  oil.
Positioning Statement and Rationale—tasty  cooking   at  affordable /
economic price.
===========================================================
Q.5. Discuss in brief the various pricing strategies used by marketers.
Suggest suitable pricing strategies for :
IN  MODERN   BUSINESS,  THE  PRICING  MUST  REFLECT
ALL   THESE  THREE   FACTORS.

1.PRICES  SHOULD  REFLECT  THE  VALUE  THE  CONSUMERS

ARE  WILLING  TO  PAY.
EXAMPLE
-for  a  piece  of  soap,  the  consumer  will  pay  only  2/3  dollars,
because  that  is  the  expectation / value for  the  product.
-for  a  medium  size  ''CHANEL''  PERFUME, the  consumer
will  be  willing  to  pay   70/80  dollars,
because  that  is  the  value/  expectations.
IF  YOU  SELL  IT  FOR   10  DOLLARS,   PEOPLE
WILL BECOME   SUSPICIOUS.
==============================================
2. PRICING   SHOULD  ALSO  REFLECT  THE  COST INVOLVED

-cost  of  production

-fixed  cost
-variable  cost
-marketing/ operating  cost.

AS  IT  NEEDS  TO  RECOVER  THE   COST   AND  MAKE

SOME PROFIT.
===================================================
3. PRICING  SHOULD  ALSO  REFLECT  THE   '''ROI''
-RETURN  ON   INVESTMENT''
as    the  stakeholders   would  want  a   reasonable  return
for   their  investment.
===============================================
Pricing decisions are extremely important for the firm. Some of the reasons:
· Pricing is the only part of the marketing mix which brings in revenue.
· Once a price has been set, consumers will often show a great deal of
resistance to any attempts to change it.
· Pricing frequently has important implications for the positioning of a
product.
· Price is the marketing mix variable for which a competitive response can be
most quickly implemented.
Conceptualizing price. A logical examination suggests that price shoulld  be
considered
in  the  context  of  money  payout  and  goods/ service received.
That is, we need to consider the quantity you receive as well as the amount
of money you have to fork out. To say that gasoline costs $1.29 is
meaningless outside the context that this cost is per gallon or, more likely,
per liter.
==============================================================
======
ALWAYS  REMEMBER,  PERCEPTION  IS   REALITY.
==============================================================
======
MARKETER'S   PERCEPTION  OF  PRICING  
-is  based  on  their  estimation  of   consumers'   value  for  the  product.

MARKETER'S  PRODUCT  POSITIONING

PRODUCT POSITIONING
In general, simple "cost-plus" pricing is inappropriate because:
Your costs, in a market which is not perfectly competitive, may not be
reflective of the costs of your competitors. If theirs are lower than yours, you
may be over pricing your products; if it is higher than yours, you may be
able to charge higher prices than cost-plus would suggest.
Your costs are not reflective of the value of the product to consumers.
The prices of some products are more salient than those of others; thus, you
may want to use some products as "loss leaders."
Cost should, however, play some role in pricing decisions:
Whether you can produce products at a cost low enough to compete
effectively against market existing market prices should help determine
whether to enter (or exit) a given market.
Understanding the relationship between price and quantity demanded as
well as the cost of producing this quantity will help make decisions on
pricing and quantity produced. In this context, note the effects of experience
previously discussed in the text. That is, it may be profitable to sacrifice
margin immediately to move along the experience curve and enjoy a cost
advantage relative to competitors later.
=========================================================
CONSUMER  PERCEPTION  OF  PRODUCT/ PRICING.
The process by which an individual selects, organizes, and interprets stimuli
into a meaningful and coherent picture
of  the
Nature of Product
Physical Attributes of Product
Package Design
Brand Name
Advertisements & Commercials
Position of Ad
Editorial Environment
================================
THIS  CONSUMER  PERCEPTION   IS    AFFECTED  BY
SENSATIONS
The human organs (eyes, ears, nose, mouth, skin) that receive sensory
inputs.
----------------------------------------------------------------------------------------------
THE ABSOLUTE  THRESHOLD
The lowest level at which an individual can experience a sensation
----------------------------------------------------------------------------------------------
SUBLIMINAL   THRESHOLD
“Getting used to” certain sensations; becoming accommodated to a certain
level of stimulation.
----------------------------------------------------------------------------------------------
THE   DIFFERENTIAL   THRESHOLD
The minimal difference that can be detected between two stimuli.
Also known as the j.n.d. (just noticeable difference).
==============================================================
Price skimming is a pricing  strategy in which a  marketer sets a relatively
high price for a product or service at first, then lowers the price over time. It
is a temporal version of price discrimination . It allows the firm to recover its
sunk costs quickly before competition steps in and lowers the market price.
Price skimming is sometimes referred to as riding down the demand curve.
As time goes by, price decreases and volume increases.
The objective of a price skimming strategy is to capture the consumer
surplus.
==============================================================
Market skimming
Marketing  a product at a high price, sacrificing high sales to gain a high
profit, therefore ‘skimming’ the market. Usually employed to reimburse the
cost of investment of the original research into the product - commonly used
in electronic markets when a new range, such as  DVDs players, are firstly
dispatched into the market at a high price. This strategy is often used to
target "early adopters" of a product/service. These early adopters are
relatively less price sensitive because either their need for the product is
more than others or they understand the value of the product better than
others. This strategy is employed only for a limited duration to recover most
of investment made to build the product. To gain further market share, a
seller must use other pricing tactics such as economy or penetration.
==============================================================
Penetration pricing is the pricing technique of setting a relatively low initial
entry price, a price that is often lower than the eventual market price. The
expectation is that the initial low price will secure market acceptance by
breaking down existing brand loyalties. Penetration pricing is most
commonly associated with a marketing  objective of increasing market share
or sales volume, rather than short term profit maximization.
The advantages of penetration pricing to the firm are:
It can result in fast diffusion and adoption. This can achieve high market
penetration rates quickly. This can take the competition by surprise, not
giving them time to react.
It can create goodwill among the all-important early adopter segment . This
can create valuable word of  mouth.
It creates cost control and cost reduction pressures from the start, leading
to greater efficiency.
It discourages the entry of competitors. Low prices act as a barrier to entry.
It can create high stock turnover throughout the  distribution channel. This
can create critically important enthusiasm and support in the channel.
It can be based on  marginal  cost pricing, which is economically efficient.
The main disadvantage with penetration pricing is that it establishes long
term price expectations for the product, and image preconceptions for the
brand  and company. This makes it difficult to eventually raise prices. Some
commentators claim that penetration pricing attracts only the switchers
(bargain hunters), and that they will switch away from you as soon as you
increase prices. There is much controversy over whether it is better to raise
prices gradually of a period of years (so that consumers don’t notice), or
employ a single large price increase (which is more efficient). A common
solution to the price expectations problem is to set the initial price at the
long term market price, but include an initial discount coupon . In this way,
the perceived price points  remain high even though the actual selling price
is low. Another potential disadvantage is the low profit margins may not be
sustainable long enough for the strategy to be effective.
Price Penetration is most appropriate when:
Product demand is highly price elastic.
Substantial  economies of  scale are available.
·   The product is suitable for a mass market (ie.: sufficient demand).
·   The product will face stiff competition soon after introduction.
·   There is inadequate demand in the low elasticity market segment for price
skimming.
·   In industries where standardization is important. The product that
achieves high market penetration often becomes the industry standard (eg.:
Microsoft Windows) and other products, even superior products, become
marginalized. Standards carry heavy momentum.
i) Software
-nature of  the product/
-product positioning/
-value  for  the  customer/
-brand/
-physical   attributes/
-absolute  threshold/
-penetration  skimming/
-------------------------------
ii) 100 CC Motorcycle
-nature of  the product/
-product positioning/
-value  for  the  customer/
-brand/
-physical   attributes/
-subliminal threshold/
-penetration  skimming/
----------------------------------------
iii) Luxury car
-nature of  the product/
-product positioning/
-package  design/
-editorial  write  up/
-brand/
-physical   attributes/
-differential  threshold/
-price  skimming/
----------------------------------------------
iv) Laptop
-nature of  the product/
-product positioning/
-package  design/
-editorial  write  up/
-brand/
-physical   attributes/
-subliminal threshold/
-market  skimming

Q.6. a) Enumerate and discuss the major packaging decisions

appropriate for the following :
From the consumer's point of view the package's function is to protect the
product. In the case of bulk goods, or if the product cannot be used without
the support of the package, the package must help the use of the product.
Without the service of packaging, most of the goods, especially food, couldn’t
reach the consumer. Living in the countryside, one can buy goods, for
example milk directly from the farmer, but a can is needed to carry it home.
This can also be considered as a refillable package, with almost an unlimited
number of uses. In a city, milk can only be bought from the store, packed in
aseptic carton box. It is not possible to avoid it, unless one goes daily to the
dairy, and drink from the tap.
From the packager's point of view, the most important function of the
packaging is the protection of the usage and aesthetic values of the product
from damages, and get the product sold to the consumer. For the producer,
the package is also a value-creating media of the product. With the help of
the package, the product can be sold to the consumer. For example, a barrel
full of toothpaste has almost no purchase value, since who wants to buy 100
litre of toothpaste? Most probably nobody would buy even a handful of it in
the grocery, but one certainly does buy 50 grams of toothpaste in a tube.

Modern packaging’s are an expressive form of the consumer-lifestyle. Over

the protective function, packaging’s are giving character, "personality" to the
product. They are following the product to the consumer, giving practical as
well as aesthetic value. The proportion of the usage and aesthetic functions
is important. The quality of packaging reflects our universal culture. All
those products that appear in the shops and offer themselves for purchase,
apart of that - with very few exceptions - their usage function is primary, are
creating the surrounding material environment.
==============================================================
WHAT  THIS  PACKAGING  PERFORMS  IN  THE   TOTAL  
MARKETING  FUNCTION.
  
Primary packaging is the material the first envelops the product and holds
it.
Secondary packaging is outside the primary packaging – perhaps used to
group primary packages together.
What  is  the  Role of Packaging
The role of packaging is containment, protection, safety, and display.
If you are selling your product through retail stores, you are trying to use
your packaging to :
-Catch the browsers attention
-Create desire
-Inspire confidence
What  is  the  Importance of  Packaging
The Importance of Packaging
Let's talk about packaging. Packaging can be thought about in many
different ways, but if we think purely about the purpose of packaging first,
we find the purpose is to:
Contain the product
Communicate product information
Facilitate product storage and shipment
Reinforce branding
Packaging is important, but you need to determine how critical it is based
on your marketing/distribution methods.
The packaging is a type of advertisement – even if it goes through mail order
to the customer directly. It will sit on the customer’s shelf for peers to see.
These peers are potential customers – and most likely they will have the
same needs as the person who already made the purchase.
The package becomes even more critical if you plan to distribute your
product through resellers and it will sit on a shelf in a store. There is a lot of
competition for the customer’s attention. If you plan to do this, it is probably
best to get a graphic designer to help you.
Use descriptive titles for the product - not necessarily creative. Many people
go into a retail store looking for products  to perform a function, but don't
necessarily have a specific product in mind. You need to communicate your
function  and benefits to them quickly and effectively.
Graphics and slogans on the package should reflect the usage of the
product.
Avoid  technical jargon except for declaring  content  requirements.
Resellers are a good source of information for good packaging design. Ask for
a reseller's input on a design.
Stickers on a package work very well for attracting attention. In addition,
you can use them to your advantage.
Include testimonial from existing users. This will inspire confidence.
Include a sales  literature  in your packaging for the customer to pass on to
their colleagues.
==============================================================
==
WHY  IS  THE   PACKAGING SYSTEM  AN IMPORTANT ELEMENT
OF   THE  MARKETING ?
Packaging system is a set of operations that fulfil the function of creating
sales units of the product. The operations of the packaging system are the
follows: raw material supply, fuel and electricity production, packaging
material production, package production, part of product processing that
enables or helps the product to be packed, packaging (filling) operation.
Since packages are made exclusively for the product's sake, the packaging
system is a part of the product's system. That is why it is very difficult to set
the boundaries of the packaging system. To set system boundaries is also a
dynamic process, and a basic step if a life-cycle study of the packaging
system shall be conducted.
A first evaluation is made in a screening LCA (Life Cycle Assessment) to
identify the key processes that have to be studied in more detailed LCA.
Three aspects can be distinguished in these consecutive steps:
-boundaries between the packaging system and the environment,
-boundaries between the packaging system and the system of the packed
product; and
-the distinction between relevant processes related to the product system
under study.
Packaging system is often confused with only the packaging or filling
operation. Although it is a very important part, but is only a part of the
packaging system. The choice of the packaging operation is a complex
decision, and it is based on the following main groups of factors:
-protection of the product,
-available packaging technology,
-economics (costs),
-marketing (especially marketing-communication),
-product's properties,
environmental considerations.
One would consider that the available packaging technology is the most
important factor, but it is not so. The history of packaging development
showed, that new packaging technologies were found first of all from the
wish to improve the protection functions of packaging.
Economics is another important factor, it is crucial for the packager to be
profitable, and spend the least possible on packaging the product.
Market considerations are another important factor especially at present
level of "supermarket societies". If a producer wants the consumer to choose
his product from the wide range of goods available, he has to do a lot more
than only produce a good product. The product shall be packed to protect
and enhance distribution.
Pleasing, arising attention, image creation, helping the using ease, and most
important: information supply, are top functions of packages.
Naturally the package's properties are adjusted to the packed product, but it
is not seldom that the product's properties are changed with the purpose of
creating more practical package shapes. The motives are primarily economic
-- simpler shapes are easier, and more effective to collect into secondary
(retail) packages.
Another motive is the environmental concern: simpler shapes use less
materials, and more effective collection to secondary packages also means
reduced resource exploitation. It is sensible, and legally required that waste
management options are considered already at package design. Design for
reuse, recovery, or eventually disposal, are newly emerged tools of
environmental marketing.
================================
THE SOCIAL IMPORTANCE OF PACKAGING
Packaging as a service
In modern societies, on the present level of economic development, to satisfy
our needs, we have to rely on the services of the society. To be able to obtain
consumer goods, we need among others the service of packaging. This study
is based on the fact that packaging is an important part of our lives. This
way the most important ‘impact’ of packaging is that it enables satisfying
human needs in an effective way.
Packaging effectivity means that packaging fulfils its function with minimal
use of resources and minimal overall wastage. Service means that packaging
consumer goods, helps their distribution, and gives an access to goods
otherwise not accessible. It is most evident in food packaging. Conserving
perishable food prevents early spoilage, invention of aseptic packaging
prolongs shelf-life and makes possible distribution also to greater distances.
This fact is more and more important in the present way of increasing
urbanisation. In such level of urbanisation, distribution of goods, especially
food, is crucial, and the role of packaging is enormous.
The role of packaging in waste reduction is the most evident at food
packaging. When food is processed and packaged, the food residues are
often used as fuel, animal feed or some economically useful by-product. In
absence of packaged processed food, the residues become garbage in the
household. Another reason why food packaging reduces waste is that it
reduces spoilage.
==========================================================
A] FMCG
THE  PRODUCT  ''PACKAGING''  COVERS  THESE  ''ATTRIBUTES''.
AND WHICH  HAS  CONTRIBUTED  TO   THE  SUCCESS  OF THE  FMCG
PRODUCT  SALES.
 -product  safely packed, with the right  packing  material.
-product quality  is  secured
-product flavor is  retained
-product content visible
-product content  identifiable
-design  layout  clear
-effective  color  combination
-the  right  font size  lettering.
-packs easily  visible /  seen  on the  store  shelf
-packaging  functional
-easy  to  shop
-meets  functional  requirements
-meets  the  packaging  technical  requirements
-packaging  carries  identifiable  brand
-instructions/directions   ''how  to  use''
-nutritional  value  displayed
 etc etc
========================================
B] CONSUMER   DURABLES   COMPANY
THE  PRODUCT  ''PACKAGING''  COVERS  THESE  ''ATTRIBUTES''.
AND WHICH  HAS  CONTRIBUTED  TO   THE  SUCCESS  OF THE
PRODUCT  SALES.
 -product  safely packed, with the right  packing  material.
-product quality  is  secured
-product content visible
-product content  identifiable
-design  layout  clear
-effective  color  combination
-the  right  font size  lettering.
-packs easily  visible /  seen  on the  store  shelf
-packaging  functional
-easy  to  shop
-meets  functional  requirements
-meets  the  packaging  technical  requirements
-packaging  carries  identifiable  brand
-instructions/directions   ''how  to  use''
 etc etc

b) Discuss the marketing strategies that may be used at the

introductory and maturity stages of the product life cycle.

1. costs are high

2. slow sales volumes to start
3. little or no competition
1. Market
4. demand has to be created
introduction stage
5. customers have to be prompted to try the product
6. makes no money at this stage

1. costs are lowered as a result of production

volumes increasing and experience curve effects
2. sales volume peaks and market saturation is
reached
3. increase in competitors entering the market
2.Maturity stage 4. prices tend to drop due to the proliferation of
competing products
5. brand differentiation and feature diversification is
emphasized to maintain or increase market share
6. Industrial profits go down

Q7

a) Discuss the main objectives of sales promotion. Explain some of the

sales promotion methods directed at consumers, which can be used
by a detergent manufacturer.

MAJOR  OBJECTIVES  OF  SALES  PROMOTIONS.

-to support  the  advertising program.
-to support the  sales team drive
-to  support  the  sales  channels - trade.
-to  accelerate  the  sales
-to drive  the  people  traffic to  the  point  of  sales.
-to stimulate the people  to make  the  buying  decision.
-to influence  the  people  to  choose a  particular brand.
-to  help the  retail to  move  the  merchandise
 -to help  to  liquidate  the  stocks.
-to  help to  overcome  the competition.
-to  help  to  gain the  market  share
-to draw the  customers'  attention  towards  the  product on the  shel

Detergent sales promotion methods directed at consumer

CONSUMERS  SALES  PROMOTION

consumer coupons
consumer  volume   discounts and sales,  
consumer  contests
point of purchase displays
free samples  
gifts
incentive items
free travel, such as free flight

b) Discuss the role of personal selling and advertising in

promotional industrial products. How does it compare to
consumer product promotion?

ROLE  OF  Personal Selling  IN  INDUSTRIAL PRODUCTS.

-here the marketing communication is used
*to  inform the customers/ prospects
*to  create awareness
*to  present  the product
*to  influence the  customer
*to  sell  benefits
*to help  the  customer to  make the  buying  decision
*to  seek  commitment
*to  help  to  close the  sale.
--------------------------------------
================================
ROLE  OF  Advertising (above and below the line)
OF THE  INDUSTRIAL PRODUCTS.

-here the  marketing  communication is  used

ABOVE  THE  LINE
*to  MASS  inform the customers/ prospects
*to  create MASS awareness
*to  present  the product
*to  influence the  customer
*to  sell  benefits
*to help  the  customer to  make the  buying  decision

BELOW  THE  LINE

*to  physically present
*to make it  visible at  the  point  of sale.
*to influence  the  customers
*to help  the  customers  to feel the  product
*to help  the  customer to  make the  buying  decision
*to offer  consumer incentives
*to  help  the  final  transactions
*to  display  and promote
*to  merchandise the product
------------------------------------------------------------------------------
ON  THE RETAIL  FLOOR  ----INDUSTRIAL  PRODUCTS
ROLE  OF  Sales Promotion  
-here the  marketing  communication is  used
*to inform  the  customers
*to  physically present
*to influence  the  customers
*to help  the  customers  to feel the  product
*to help  the  customer to  make the  buying  decision
*to offer  consumer incentives
*to  help  the  final  transactions
--------------------------------------------
ROLE  OF  Direct Mail ---INDUSTRIAL PRODUCTS
-here the  marketing  communication is  used
*to  inform
*to  talk  to  individuals
*to  focus  on  niche  market
*to inform the  decision  makers  directly
*to   advertise cost efficiently
*to promote selected  market  segments
*to contact individuals  for  one-to-one  marketing
--------------------------------------------------------------------
==================================================
How does it compare to consumer product promotion.

1.CONSUMER  PRODUCTS
-appeals to  the  consumer  emotions.
-appeals to  the  consumer  desires.
-influences  the  buying  decisions
with benefits feelings.

2.INDUSTRIAL  PRODUCTS
-appeals  to  the consumer benefits.
-appeals  to  the  consumer  ownership.
-influences  the  buying decisions
with  the usage  values

Q8 b)

You are marketing manager of a medium sized manufacturing

company. The president has just made the following statement
 "The distribution activity is not a concern of the marketing
department. The function of the marketing department is to sell
the product ... let be rest of the company handle production and
distribution."How would you reply to this statement? Discuss
whether you agree or disagree with the statement and justify
your answer.

I believe works, is to get involved. in what ever it is , what works for me I

think the consumer needs to get their hands wet, and use the product and
then. he or she .will get the full benefits of the program what ever it may be

Q.11. What variables would you use in segmenting the market for the
following products and why?

i) Credit Card

ii) Sports car

[1] CREDIT CARD

FOR THE BUSINESSES.

[variables provide benefits for the business usage / ease of operation ]

-reduction in operation expenses.

-improvement in the cash flow.

-improvement in the working conditions for field employees.

-improvement in the productivity of field employees.

-improvement in the business market coverage

-improvement in the business results.

FOR THE INDIVIDUALS

[variables which will attract the individual customers to the product]

1.Demographic variables

*age

*gender Male and Female

*family size

*Education Primary, High School, Secondary, College, Universities.

*income

*occupation

--------------------------------------------------

2. socioeconomic status

*religion

*language

-----------------------------------------

3. Geographic variables

*region of the country,NORTH / SOUTH/ EAST/ WEST/CENTRAL etc.

*metro/ rural : Metropolitan Cities, small cities, towns.

---------------------------------

4.Psychographic variables

*personality

*life style

*value

*attitude

--------------------------

5.Behavioural variables

*benefit sought

*product usage rate

*brand loyalty

*product end use

*readiness-to-buy stage
*income status

=======================================

[2] SPORTS CAR

FOR THE INDIVIDUALS

[ variables to which the product would appeal ]

1.Demographic variables

*age

*gender Male and Female

*Education Primary, High School, Secondary, College, Universities.

*income

*occupation

--------------------------------------------------

2. socioeconomic status

*REGIONAL FOCUS

*language

-----------------------------------------

3. Geographic variables

*region of the country,NORTH / SOUTH/ EAST/ WEST/CENTRAL etc.

*metro/ rural : Metropolitan Cities, small cities, towns.

*Density of Area Urban, Semi-urban, Rural.

---------------------------------

4.Psychographic variables

*personality

*life style

*value
*attitude

--------------------------

5.Behavioural variables

*benefit sought

*product usage rate

*brand loyalty

*product end use

*readiness-to-buy stage

*decision making unit

*profitability

*income status

Q12 Discuss briefly steps of marketing research process

Problem Identification and Definition

This is the introductory phase of the marketing research process. Basically,
it involves a clear and precise understanding of the problem at hand. It is
crucial that the research team identifies, understands and defines the
problem in its entire capacity, as it affects all the subsequent activities
involved in the research process. Research teams make use of customer
feedback, internal and external data reports, sales graphs, purchasing
patterns, etc. to come up with an accurate problem definition.

Designing a Proper Approach

The next step is to come up with a near-flawless approach which is aimed at
solving the identified problem. During this process, the research team has to
analyze and examine a variety of factors such as the company's targets,
goals and objectives, financial resources, skill sets, manpower, industry
environment, changing business trends, etc. This phase often involves joint
discussions between the research team, industry experts and higher
management.

Developing the Actual Research Design

This is the decisive step of the marketing research process. The research
design is the very fulcrum of the entire marketing research process. The
solidity of the research design alone decides the success or failure of the
research program to a large extent. Naturally, this step is the most time-
consuming of all the steps and it needs careful thinking and precise
execution. Different activities involved in this process include feedback
analysis, qualitative and quantitative analysis, preparing questionnaires as
well as sampling of data and processes.

Data Collection and Survey

This process mainly involves a lot of field-related work activities such as
outdoor interviews, survey campaigns and feedback sessions which are done
by specially assigned data collection agents or field agents. Almost all of
those doorbell-ringing pamphlet guys or the irritating tele-callers who
telephone at the most untimely of hours, are data collection agents who are
just doing their duty, as part of their company's marketing research process.
Data collection and surveying is also implemented by means of Internet
surveys, group discussions, mail surveys, etc.

Data Structuring and Analysis

Once the data collection and surveying activities have yielded sufficient and
relevant data, it is time to systematically organize the data so that it can be
interpreted and analyzed by decision makers. This typically involves
activities such as data mining, clustering of data, preparing statistical
graphs and curves, etc.

Report Generation and Presentation

All the effort that goes into designing an approach, developing a research
design, collecting data and finally analyzing the data, completely goes waste,
if the findings and the results are not presented properly. It is imperative
that the whole marketing research project be properly documented and
accounted for. The entire purpose of the research campaign is to enable the
higher management to make informed decisions which will benefit the
progress and the sales of the concerned product or service. Hence, it is
crucial that the research findings be presented accurately, clearly and
relevantly. For this purpose, the use of appropriate statistics, graphs, pie-
charts, etc. is recommended.

Marketing research is a thoroughly linked process, wherein every step is

individually as well as collectively important. A slight mistake or
shortcoming in any of these steps can largely affect the eventual success or
failure of the entire marketing research campaign.

Q13

(b) How can test marketing be helpful in launching new products?

Launching new products in the market involves heavy investment and huge
risk.So,before introducing any new product /service in market, many
organizations in order to understand the response of the customers with
respect to their new product/service ,take the help of test
marketing.Thus,test marketing can be defined as one of the steps of
product development stage where an experiment is conducted on the new
product under the same circumstances and conditions on a smaller scale in
order to understand the consumer’s response. This provides various
information’s to the product developers about consumers response, which
helps them to use those information’s and launch their product on
larger/national scale.

The objective of every organization is to earn profit through sales and hence
test marketing provides all essential information in advance and thus
ensures that the launch is successful. However, for successful test
marketing; there should be correct selection of test market. Test market
should be smaller replica of the target market and should have similar
population as that of proposed target audience. In also includes duplication
of the other marketing tools like promotion, distribution, pricing etc on
smaller scale. Thus, test marketing helps to gauge about the product in
wider scale.

Test marketing results are very carefully observed and monitored before
launching the product on larger scale, nationally. Its helps the product
launchers to know about the consumer behavior and their buying
behaviour. This in return provides an opportunity to the organization to
remove any flaws present in the product and thus help them to add new
features (if needed)into the product or bring about small changes as revealed
by the test before launching the product nationally.

Test marketing can also be explained as forecasting sales in a controlled

environment. Hence, inspite of its various advantages, has certain
limitations too…

* It’s not possible to find exact replica of target market. So, all test markets
always have to be carried out with some exceptions like other market
research
One of the objectives of test marketing is to avoid huge loss for the company
but still such test involves considerable investment and hence its failure
may also incur loss to the company.

* Time frame of test marketing depends upon the objective set by the
company. Hence test marketing involves lot of time. This provides its
competitors an extra edge to launch its product before them.

* Gives its competitors a chance to know about the marketing strategy and
about its product in advance.

* It alerts the competitors and thus provides more competition of itself.

However, in spite of its some limitations, test marketing provides its

consumers an opportunity to react to test markets. Thus, test marketing
makes the organizations confident about their product and marketing
strategy by providing valuable information on customers response
,promotion ,price distribution and advertising media before launching it into
the national level
Q-18

i) Discuss the role of 4p’s in formulating marketing strategy in

the following situations?

a) Water Purifier

b) Small sized car at rs 2.00 lakh

The marketing strategy is usually built around

the 4Ps

P1=PRODUCT

P2=PRICE

P3=PROMOTIONS

P4=PLACE [ SALES/DISTRIBUTION]

====================================

The marketing strategy must respond to the nature

of the product / market situation.

The marketer would use different weightages for the 4Ps

as per the situations.

==================================

i) Water Purifier

1.customer expectation about ''FREQUENT USAGE''

Market Penetration Strategies.

P1

1.ATTRACTING COMPETITORS' CUSTOMERS.

Sharper product differentiation.

Finding other products' uses.

Increasing promotional effort.

---------------------------------------

P2

2.INCREASING PRESENT CUSTOMERS' RATE OF USAGE.

Increasing the units of sales.

(Special price packages/cross selling products)

Reduction in price.

Price incentive for increased use.

-----------------------------------------------

P3

3.REDUCING NUMBER OF LOST CUSTOMERS.

Improving communication with present customers.

Promotion aiming at existing customers.

Understand reasons for losing customers.

---------------------------------------------------------

P4

4. CONCENTRATING RESOURCES ON MOST PROFITABLE CUSTOMER

SEGMENTS.

Concentrating on distribution channels reaching most profitable segments.

Offering total customer service at higher price.

ii) Small sized car priced at Rs. 2.00 lakhs

2.customer expectation about ''wide'' availability.

New Market Development Strategies.

P1

1.positioning.
----------------------------------------

P2

2.ATTRACTING NEW USERS / NON-USERS.

Inducing trial use, BY EXPOITING PRICE POINTS.

Being flexible in pricing.

---------------------------------

P3

3.ATTRACTING OTHER MARKET SEGMENTS.

Seeking other distribution channels.

Advertising in other media.

-------------------------------------

P4

4.NEW GEOGRAPHICAL MARKETS.

National market expansion.

Regional market expansion.

Export market expansion

ii) How would you apply your knowledge of segmentation,

targeting, and positioning (STP) for

a) Promoting pulse polio immunization?

b) Soft drinks

If you’re interested in target marketing, the first step is to do the research

that will help you define and zero in on your target market.

A Market segment is a subgroup of people or organizations sharing one or

more characteristics that cause them to have similar product needs.

Market segmentation is the process in marketing of dividing a market into

distinct subsets (segments) that behave in the same way or have similar
needs. Because each segment is fairly homogeneous in their needs and
attitudes, they are likely to respond similarly to a given marketing strategy.
That is, they are likely to have similar feelings and ideas about a marketing
mix comprised of a given product or service, sold at a given price,
distributed in a certain way and promoted in a certain way.

Broadly, markets can be divided according to a number of general criteria,

such as by industry or public versus private sector. Small segments are
often termed niche markets or specialty markets. However, all segments fall
into either consumer or industrial markets. Although it has similar
objectives and it overlaps with consumer markets in many ways, the process
of Industrial market segmentation is quite different.

The overall intent is to identify groups of similar customers and potential

customers; to prioritize the groups to address; to understand their
behaviour; and to respond with appropriate marketing strategies that satisfy
the different preferences of each chosen segment. Revenues are thus
improved.

Improved segmentation can lead to significantly improved marketing

effectiveness. With the right segmentation, the right lists can be purchased,
advertising results can be improved and customer satisfaction can be
increased

==============================================================

These criteria can be summarized :

D Differential: it must respond differently to a different marketing mix

A Actionable: you must have a product for this segment to be accured

M Measurable: size and purchasing power can be measured

A Accessible: it must be possible to reach it efficiently

S Substantial: the segment has to be large and profitable enough

==============================================================

The variables used for segmentation include:

Geographic variables

region of the country, East, West, South, North, Central, coastal, hilly, etc.

country size/country size : Metropolitian Cities, small cities, towns.

Density of Area Urban, Semi-urban, Rural.

Demographic variables

-age

-gender Male and Female

-family size

Education Primary, High School, Secondary, College, Universities.

income

occupation

education

socioeconomic status

language

Psychographic variables

personality

life style

value

attitude

Behavioural variables

benefit sought

product usage rate

brand loyalty

product end use

readiness-to-buy stage

decision making unit

When numerous variables are combined to give an in-depth understanding
of a segment, this is referred to as depth segmentation.

When enough information is combined to create a clear picture of a typical

member of a segment, this is referred to as a buyer profile. When the profile
is limited to demographic variables it is called a demographic profile
(typically shortened to "a demographic"). A statistical technique commonly
used in determining a profile is cluster analysis.

==============================================================

THE BY-PRODUCT OF MARKET SEGMENTATION IS THE

IDENTIFICATION OF THE PARTICULAR SEGMENT, WHICH ONE

WANTS TO EXPLOIT.

HENCE TO AIM AT THE NICHE MARKET,

ONE MUST HAVE TO SEGMENT THE MARKET FIRST,

IT IS A CRITICAL STEP.

------------------------------------------------------------------------------

A niche market also known as a target market is a focused, targetable

portion (subset) of a market sector.

By definition, then, a business that focuses on a niche market is addressing

a need for a product or service that is not being addressed by mainstream
providers. A niche market may be thought of as a narrowly defined group of
potential customers.

A distinct niche market usually evolves out of a market niche, where

potential demand is not met by any supply.

Such ventures are profitable because of disinterest on the part of large

businesses and/or lack of awareness on the part of other small companies.
The key to capitalizing on a niche market is to find or develop a market
niche that has customers who are accessible, that is growing fast enough,
and that is not owned by one established vendor already.

Marketing in and for niche markets

Niche marketing is the process of finding and serving profitable market
segments and designing custom-made products or services for them. For big
companies those market segments are often too small in order to serve them
profitably as they often lack economies of scale. Niche marketers are often
reliant on the loyalty business model to maintain a profitable volume of
sales. this also means theres a gap in the market

==============================================================

To Qualify As A NICHE Market Target, A Group Of Customers Should

Meet Important Conditions.

For any group regarded as a potential NICHE market target, the following
questions should be asked:

Will the group satisfy our profit objectives?

Is it apt to grow?

How stable is the market?

Can we accurately measure the size and purchasing power of the target?

Will we be able to reach the target with our promotion?

Do we have the resources to serve the proposed targeted market?

Are the homogeneous customers within the possible segment influential?

Will their purchases cause other groups to buy the products?

Can we identify the customers so that we can know where and how to
appeal to them?

How strong is our competition in this target market? Are there any
competitive opportunities for us?

Many market segments will not meet the above requirements. For instance,
a certain group may not have promising growth potential, yet it may offer
stable and profitable business forces.

THIS WILL HELP TO REDUCE THE RISK FACTORS.

=================================================

PRODUCT POSITIONING IN THE SELECTED MARKET SEGMENT.

FIRST STEP -- DO THE RESEARCH

The first step in the positioning process is to do the research. The good news
is that product marketing managers already have done most of the research
as part of their job. To successfully position a product, you need a thorough
understanding of customer problems, channel issues, and how competitors
are positioned. The answers to these and other questions become part of a
rationale document for your positioning strategy:

What is your target market (size, type of company, etc.)?

Who is the decision maker you want to target your message to, and what
keeps that decision maker awake at night?

What pressing problem does your product solve for your prospective
customer?

How is your prospect solving that problem today?

What specific benefit does your product deliver?

Why is your product better than the current solution and competitive
alternatives?

Who are your key competitors; why and when do you win or lose to them?

How do your competitors position themselves in their marketing

communications, including ads, direct mail campaigns, brochures, and web
sites?

What makes your product unique in a way that is relevant to your prospect?

Are there any problems, unique challenges, or special needs of your

channel?

What do prospects and customers like and dislike about your product?

Do prospects and customers share your belief of why your product is better
than the competition’s?

Are there any characteristics of a sales situation that indicate whether or

not your product or service will be selected?

Now incorporate the answers to these questions in a rationale document. By

doing so, all product knowledge is captured in one place and can be used as
a reference guide when marketing and sales need it. The rationale document
should be three to five pages and should include this information:

Product Category—Define the product’s key features, advantages, and

benefits. A matrix can help clarify these items.
Product Line Fit—Describe how the product fits into the overall company
product strategy.

Situation Analysis—Describe the conditions that justify the release of this

product, including why the company believes it can be successful.

Market Analysis—Profile target market(s) by size, revenue, market segment,

operational type, or other relevant categories.

Audience Analysis—Profile key prospects within the target market(s),

including job titles and functions (demographics) and their concerns,
attitudes, and behaviors (psychographics).

Distribution—Describe how the product will be distributed and the impact of

distribution on product communications.

Competitive Positioning—Describe the key competitors, their targets, and

how they position their products.

Positioning Statement and Rationale—Evaluate the product positioning

statement against the following four criteria: Is it important, unique,
believable, and usable?

Support Points—Describe how the three support points make the

positioning statement unique, believable, and important. If multiple markets
or audiences require unique support points, explain why.

A rationale document transfers important product knowledge to those who

need to know, but who don’t have the time or expertise to find the
information themselves. It’s especially useful when creating a product
message strategy that includes a positioning statement (number 8 in the
rationale document) and three or four support points (number 9).

A MESSAGE STRATEGY IS A TIME SAVER

Your positioning statement becomes the central idea and theme underlying
all marketing activities. It is a short, compelling, declarative sentence that
states just one benefit and addresses the target market's number one
problem. It must be unique, believable, and important, or the target market
will ignore the message. Once you have found the right message, your
product marketing managers won’t need to be involved in every planning
session for every marketing campaign.

Supporting benefit statements tell the story in more detail. They also provide
a structure for product demonstrations. While the positioning statement
articulates a high-level benefit, the claims made in the supporting
statements should be readily demonstrable. That is, in just a few steps, you
should be able to show how the product delivers concrete benefits.
Make sure your message strategy has enough detail to support the creation
of a standard product demonstration. This helps your product marketing
managers to create a demo quickly. And there’s another benefit—the
product detail in the support points answers a lot questions before
marketing and sales ask them.

A message strategy also facilitates delivery of the same message across all
marketing media, including web sites, brochures, advertisements, and
presentations to investors, industry analysts, and prospects. A standard
outline format makes it easy for writers and other communicators to see the
message strategy's benefit hierarchy, and to take full advantage of it.

===================================================

i) Promoting Pulse Polio Immunization

MARKET SEGMENT -young children.

TARGET -parents of the young children

POSITIONING -life saving support program.

ii) Soft Drinks

MARKET SEGMENT - young people.

TARGET - age group [ 12 ---35]

POSITIONING - lifestyle entertainment

Q19

b) Explain the major objectives of advertising and publicity. Discuss

with the help of suitable examples.

THE MAJOR OBJECTIVES

-Goals that an organization seeks to achieve through its promotional

program in terms of communication effects such as

- creating awareness of the product/brand,

-knowledge of the product/ brand

[features/ benefits of the product usage]

-images of the product/brand,

-attitudes of the users of the product,

-help people to show their preferences for the product,

-help people to make the purchase intentions.

-increasing response rates

- contributing to ROI business goals.

Build a brand image- Test customer awareness of brand recognition and

perceived values Increase Sales- Levels of repeat purchase

Build customer loyalty and relationship- Levels of customer retention

Change customer attitudes- Measure demographic profile of purchases

- Measure type of goods ordered by new purchasers

- Compare with previous data. Stimulate an increase in sales- Number of

enquiries from advert, - Number of enquiries converted into sales

Remind customers of the existence of a product- Test customer awareness

both before and after the advertising campaign, - Number of enquiries

Inform customers- Test customer awareness, - Number of requests for

further information

OBJECTIVES COULD INCLUDE

-creates product awareness -makes known product availability

-creates product perception -helps to develop product memory

-helps to develop a brand image -creates a desire -develops a want

-stirs up the brand -harnesses the desire -helps in making the buying
decision -helps to influence the choice -helps in buying

--------------------------------------------------------------

Several broad objectives including:

building product awareness,

creating interest,

providing information,

stimulating demand and

reinforcing the brand. To achieve one or more of these objectives, advertising

is used to send a message containing information about some element
of the marketer’s offerings.

For example:

Message About Product – Details about the product play a prominent role in
advertising for new and existing products. In fact, a very large
percentage of product-oriented advertising includes some mention of
features and benefits offered by the marketer’s product. Advertising
can be used to inform customers of changes that take place in existing
products.For instance, if a beverage company has purchased the
brands of another company resulting in a brand name change, an
advertising message may stress “New Name but Same Great Taste”.

==============================================================

Message About Price – Companies that regularly engage in price

adjustments, such as running short term sales (i.e., price markdown),
can use advertising to let the market know of price reductions.
Alternatively, advertising can be used to encourage customers to
purchase now before a scheduled price increase takes place.

======================================================

Message About Other Promotions – Advertising often works hand-in-hand

with other promotional mix items. For instance, special sales
promotions, such as contests, may be announced within an
advertisement. Also, advertising can help salespeople gain access to
new accounts if the advertising precedes the salesperson’s attempt to
gain an appointment with a prospective buyer. This may be especially
effective for a company entering a new market where advertising may
help reduce the uncertainty a buyer has about a new company.

=====================================================

Message About Distribution – Within distribution channels, advertising can

help expand channel options for a marketer by making distributors
aware of the marketer’s offerings. Also, advertising can be used to let
customers know locations where a product can be purchased.

==============================================================
ADVERTISING/ PUBLICITY Communication OBJECTIVES involve ...

Awareness

Comprehension

Brand insistence or loyalty

Feelings

Attitudes toward the product

General Advertising/ PUBLICITY Objectives could be

To prompt direct action

To encourage information search

To relate product to needs

To encourage recall of past satisfactions.

To modify attitudes

To reinforce attitudes

To highlight product differences

To reveal product attributes or benefits

To push price/quality

To target product users

To exhibit product usage or application

To fight Against a particular competitor

To fight Against an entire product category

To show association

To show a solution to a problem situation

============================================

THE CLASSIC EXAMPLE OF ADVERTISING/ POLICY OBJECTIVES

IS THE ''LUX'' TOILET SOAP [ WELL KNOWN BRANDED PRODUCT]

1.AWARENESS

-many people are aware of the product.

-many people know what the product is.

-many people are aware of the brand.

-------------------------------------------------------------------

2.COMPREHENSION

-people understand what the product does.

-people know the benefits of using it.

-people can differentiate from other such brands.

----------------------------------------------------------------------------

3.CONVICTION

-people are convinced about the benefits.

-people who use it can feel the benefits.

-people enjoy the fuzzy feeling / goodness of the lux.

-----------------------------------------------------------------------

4.ACTION

-people are buying.

-there is repeat purchase.

Q-16 Write short notes on the following:-

a) Product life cycle (PLC)

The Product Life Cycle (PLC) is based upon the biological life cycle. For
example, a seed is planted (introduction); it begins to sprout (growth); it
shoots out leaves and puts down roots as it becomes an adult (maturity);
after a long period as an adult the plant begins to shrink and die out
(decline).In theory it's the same for a product. After a period of development
it is introduced or launched into the market; it gains more and more
customers as it grows; eventually the market stabilises and the product
becomes mature; then after a period of time the product is overtaken by
development and the introduction of superior competitors, it goes into
decline and is eventually withdrawn.However, most products fail in the
introduction phase. Others have very cyclical maturity phases where
declines see the product promoted to regain customers.

Strategies for the differing stages of the Product Life Cycle.

Introduction. The need for immediate profit is not a pressure. The product
is promoted to create awareness. If the product has no or few competitors, a
skimming price strategy is employed. Limited numbers of product are
available in few channels of distribution. Growth. Competitors are attracted
into the market with very similar offerings. Products become more profitable
and companies form alliances, joint ventures and take each other over.
Advertising spend is high and focuses upon building brand. Market share
tends to stabilise. Maturity. Those products that survive the earlier stages
tend to spend longest in this phase. Sales grow at a decreasing rate and
then stabilise. Producers attempt to differentiate products and brands are
key to this. Price wars and intense competition occur. At this point the
market reaches saturation. Producers begin to leave the market due to poor
margins. Promotion becomes more widespread and use a greater variety of
media. Decline. At this point there is a downturn in the market. For
example more innovative products are introduced or consumer tastes have
changed. There is intense price-cutting and many more products are
withdrawn from the market. Profits can be improved by reducing marketing
spend and cost cutting. Problems with Product Life Cycle.In reality very
few products follow such a prescriptive cycle. The length of each stage varies
enormously. The decisions of marketers can change the stage, for example
from maturity to decline by price-cutting. Not all products go through each
stage. Some go from introduction to decline. It is not easy to tell which stage
the product is in. Remember that PLC is like all other tools. Use it to inform
your gut feeling

B)Decision making process – Stages in the buyers decision process:-

Buyer decision processes are the decision making processes undertaken
by consumers in regard to a potential market transaction before, during,
and after the purchase of a product or service.A general model of the buyer
decision process consists of the following steps:

1.Problem recognition;

2.Information Search

3.Evaluation of Alternative

4.Purchase decision

5.Purchase Behaviour

There are a range of alternative models, but that of AIUAPR, which most
directly links to the steps in the marketing/promotional process is often
seen as the most generally useful[1]; AWARENESS - before anything else
can happen the potential customers must become aware that the product or
service exists. Thus, the first task must be to gain the attention of the target
audience. All the different models are, predictably, agreed on this first step.
If the audience never hears the message, they will not act on it, no matter
how powerful it is . INTEREST - but it is not sufficient to grab their
attention. The message must interest them and persuade them that the
product or service is relevant to their needs. The content of the message(s)
must therefore be meaningful and clearly relevant to that target audience's
needs, and this is where marketing research can come into its own.
UNDERSTANDING - once an interest is established, the prospective
customer must be able to appreciate how well the offering may meet his or
her needs, again as revealed by the marketing research. This may be no
small achievement where the advertiser has just a few words, or ten
seconds, to convey their message. ATTITUDES - but the message must go
even further; to persuade the reader to adopt a sufficiently positive attitude
towards the product or service that he or she will purchase it, albeit as a
trial. There is no adequate way of describing how this may be achieved. It is
simply down to the magic of the advertiser's art, or based on the strength of
the product or service itself. PURCHASE - all the above stages might happen
in a few minutes while the reader is considering the advertisement; in the
comfort of his or her favorite armchair. The final buying decision, on the
other hand, may take place some time later; perhaps weeks later, when the
prospective buyer actually tries to find a shop which stocks the
product.REPEAT PURCHASE - but in most cases this first purchase is best
viewed as just a trial purchase. Only if the experience is a success for the
customer will it be turned into repeat purchases. These repeats, not the
single purchase which is the focus of most models, are where the vendors
focus should be, for these are where the profits are generated. The earlier
stages are merely a very necessary prerequisite for this!