Subject Code: PMM1A Paper: Marketing Management Specific Instructions:

Answer all the four questions. Marks allotted 100. Each Question carries equal arks.

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Question No1

Toyota is planning to launch a small car in India by 2010. However it wishes to understand the buying behavior of the market first. Suggest to the company as to which dimensions of such behavior should the company focus on for detailed scrutiny. The automobile industry today is the most lucrative industry. ue to the increase in disposable income in both rural and urban sector and easy finance being provided by all the financial institutes! the passenger car sales have increased at the rate of "#$ per annum in %une 2011&12 over the corresponding period in the pervious year. 'urther competition is heating up in the sector with a host of new players coming in and other like (orsche! )entley! *udi! and )+, all set to venture in the Indian markets. -ne factor that could help the companies in the marketing of their product is by knowing and creating a personality for their brands. 'oreign car companies have discoveredthe Indian consumer as well as the . / potential in the Indian technicalfraternity and are setting up manufacturing plants right and left across the countryat lower costs. The Indian automobile industry is currently e0periencing anunprecedented boom in demand for all types of vehicles. Toyota should focus on brand personality. * brand is 1a set of e0pectation and association evoked from a company orproduct. * brand is how your key constituents& customers! employees!shareholders etc. e0perience what you do.2 Some brands

are of such greatimportance to people! that we speak of them as a part of one3s life and identity!being used to e0press one. Some would say that these brands have their ownpersonality! the brand personality! which can be defined as 1the set of humancharacteristics associated with a given brand2. Thus! it includes suchcharacteristics as gender! age and socioeconomic class! as well as such classichuman personality is both distinctive and enduring.)ased on the premise that brand can have the personalities in much the sameway as humans! brand personality describe brands in terms of humancharacteristics. )rand personality is seen as valuable factor in increasing brandengagement and brand attachment! in much the same way as people relate andbid to other people. +uch of the work in the area of brand personality is based ontranslated theories of human personality and using similar measures ofpersonality attributes and factors. )rand personality refers to the set of humancharacteristics we associated with the brand. * common way of determining thisis to reply on the metaphor4 1If the brand was a person! what would he5she belike62 we then list and group the traits to describe the brand as! for e0ample4caring! approachable and trustworthy. However! there is a lot more we can do.)ecause many people interact with brands as though they were other people! itis important to understand what a brand personality consists of! and how itscharacteristics can be used to affect the relationship between the brand and itsuser. 7nowing and understanding the brand personality gives a good insight intothis relationship! and into peoples3 attitudes towards the brand! and is also asimportant guide to communicating the brand. *dvertising agencies such as 8oung / .ubicam and -gilvy / +ather routinely include a brand personality statement as a part of their brand positioning strategy. *ccording to )hatia! as long as advertising for cars is strongly differentiated andsharply positions the model and at the same time satisfies a define needsegment! it shall have the capability to break the clutter and creates a uni9ue andcompelling reason for consumers to purchase. 1-ne good e0ample of this is 'ordIkon& the :osh machine made a tremendous impact on consumers in offering tosatisfy a clear need. 8ou can see some more of this with a recently launchedpremium hatch back as well2.Interestingly! the strategy marketer follow changes a bit when it comes toaddressing the smaller car category with the rational benefits of a brand tendingto be the focal point of the campaign. 1,e have found that typically a buyer for asmaller car ;sub .s < lac= looks for aspects such as reliability and fuel efficiency.This changes as we move up since in case the consumer has been with thecategory for a longer time and hence it is important t to talk of an emotional payoff.* case in point is the +aruti #00 campaign in which the kids who is playing with atoy +aruti #00 e0claims to his dad ;when asked how long will he keep on runningthe car=! 1papa ki 7ara! petrol khatam hi nahin Honda.2 The ad cleverly conveysthat the car :ust keeps going on and

on. It ends with the voiceover telling us that+aruti Su>uki is most fuel& efficient car.However in the small car segment! the rational benefits magic is not alwaysapplicable.

Question No2

a= Selecting the right target is one of the most crucial aspects of marketing. ?0plain.

The target market is the group of people that a communication is specifically trying to reach. This is a vital concept in business marketing strategies, where businesses attempt to increase their market share by appealing directly to certain kinds of customers based on demographics. While the message itself is always important, the target market dictates what type of message should be created and what qualities it should have. Many aspects of communication a target depend on this an understanding. Choosing market allows

organization to focus its message to a select group of people. The group can be either large or small, but either way, the organization can set clear goals for reaching them and save the costs associated with trying to reach everyone equally an ultimately futile endeavor. !ocusing on a specific target market the also can save to it. time in the creating proper and making to of communication materials. "aving a target market also enables organization with choose !or channels forms communicate instance, online

communication tend to work better with younger generations that are familiar with social media, and worse with older generations that do not use computers as often. #osters and banners work best when communicating to a local audience, while seminars work best to reach a group of people who may

otherwise have time constraints. Te$tual and vocal messages also appeal to different sets of people. The target market should always dictate the best channel of communication. The more a business understands a target market, the better it can construct communications to reach them and mean e$actly what is intended. % good e$ample of this advantage remains cultures outside those the organization belongs to. &ifferent cultures have different languages, nonverbal cues and customs that create different communication environments that can distort or negate communication from those unaware of such differences. %n organization with a deep understanding of a target market will ultimately be able to understand what that market feels is important' what norms, values or virtues they shape their lives by' and what needs they have. This type of deeper understanding allows organizations to communicate messages in such a way that audiences immediately understand and identify with them. b= ?0plain segmentation! targeting and positioning for the following brands@ i= .eliance fresh Segmentation A target customers living in urban areas! who wants to buy fresh and healthy food and have a mindset of buying grocery from organi>ed retail stores and perceive it as status symbol Targeting A targeting females with age 1#&B0 years! middle to upper income class groups! targeting both working women and housewives and minimum graduates (ositioning A emphasi>ing on merchandi>ing! store image! store personnel! and position it as retail stores with fresh vegetables and food at highly reasonable price icor

ii= Tata Safari

Segmentation A target customers living in urban areas! who wants to buy stylish and big car! have a mindset of buying high class lu0ury cars with huge space! band conscious and perceive it as status symbol Targeting A targeting males with age 2B&<B years! middle to upper income class groups! targeting! business class people and minimum graduates (ositioning A emphasi>ing on style! look! passion! strength and pace

iii= +aggi atta noodles Segmentation A target customers living in rural! semi urban and urban areas! who are health conscious! use have a small meal during the breakfast and day time and perceive it as good for health Targeting A targeting both males and females with age #&B0 years! lower! middle to upper income class groups! targeting people with no limitation on education (ositioning A emphasi>ing on health! low price and 9uick serving small meal iv= 7ingfisher *irlines Segmentation A urban area! high density population areas! upper income class groups and socio&economic class * segment Targeting A company e0ecutives! lower middle! upper middle and lower upper segment (ositioning A lifestyle! benefits and 9uality

Question No3

;a= How is the growth of organi>ed retail affecting the distribution strategies of marketers6 )usiness marketing is a marketing practice of individuals or organi>ations ;including commercial businesses! governments and institutions=. It allows them to sell products or services to other companies or organi>ations that resell them! use them in their products or services or use them to support their operations. )usiness marketing is also known as industrial marketing or business& to&business ;)2)= marketing. espite sharing dynamics of organi>ational marketing with marketing to governments! business&to& government marketing is different. )usiness markets have a derived demand A a demand in them e0ists because of demand in the consumer market. *n e0ample would be the Indian government wishing to purchase e9uipment for a nuclear power plant. The

underlying consumer demand that has triggered this is that people of India are consuming more electricity ;by using more household devices such as washing machines and computers=. )usiness markets do not e0ist in isolation. * single consumer market demand can give rise to hundreds of business market demands. The demand for cars in India creates demands for castings! forgings! plastic components! steel and tires. In turn! this creates demands for casting sand! forging machines! mining materials! polymers! rubber. ?ach of these growing demands has triggered more demands. *s the spending power of citi>ens increases! countries generally sees an upward wave in their economy. Cities or countries with growing consumption are generally growing business markets. espite the differences between business and consumer marketing from a surface perspective being seemingly obvious! there are more subtle distinctions between the two with substantial ramifications. wyer and Tanner ;200D= note that business marketing generally entails shorter and more direct channels of distribution. ,hile consumer marketing is aimed at large groups through mass media and retailers! the negotiation process between the buyer and seller is more personal in business marketing. *ccording to Hutt and Speh ;200<=! most business marketers commit only a small part of their promotional budgets to advertising! and that is usually through direct mail efforts and trade :ournals. ,hile advertising is limited! it often helps the business marketer set up successful sales calls. +arketing to a business is trying to make a profit ;business&to&business marketing= as opposed to an individual for personal use ;)usiness&to& Consumer! or )2C marketing= is similar in terms of the fundamental principles of marketing

;b=,hat would be the ideal distribution channel for the following product categories6 i. Shampoo & retailing ii. +icrowave ovens A online marketing portal iii. esigner %ewellery & franchisee
Question No4

,rite short notes on the following4 i. Impact of technology on current marketing practices. (rofessionals who have contact with customers are now EtouchingE with technology. ,ith each passing day! sales! marketing! and even customer service positions are becoming increasingly focused on technology. In a one&on&one interview with SearchC.+.com! Stephen

iorio! (resident! I+T Strategies! shares his thoughts on the 12 impacts of technology on sales and marketing. E-ver the ne0t ten years! rapidly changing technology will impact most aspects of sales and marketing strategy and management!E e0plains iorio. EIn particular! the rush to deploy e&business! ,eb marketing and C.+ solutions will transform the role of the sales and marketing professional.E *ccording to iorio! to drive profitable growth! sales and marketing leaders should do the following4 +a0imi>e the return on investment ;.-I= on all sales and marketing investments@ *nticipate and capitali>e on rapid changes in customer buying behavior@ 'ind ways to leverage interactive! database! and network technologies to grow sales@ and Stay one&step ahead of new business models and online competition.

+arketing management can also rely on various technologies within the scope of its marketing efforts. Computer&based information systems can be employed! aiding in better processing and storage of data. +arketing researchers can use such systems to devise better methods of converting data into information! and for the creation of enhanced data gathering methods. Information technology can aid in enhancing an +7ISF software and hardware components! and improve a companyFs marketing decision&making process. In recent years! the notebook personal computer has gained significant market share among laptops! largely due to its more user&friendly si>e and portability. Information technology typically progresses at a fast rate! leading to marketing managers being cogni>ant of the latest technological developments. +oreover! the launch of smartphones into the cellphone market is commonly derived from a demand among consumers for more technologically advanced products. * firm can lose out to competitors should it ignore technological innovations in its industry. Technological advancements can lessen barriers between countries and regions. Gsing the ,orld ,ide ,eb! firms can 9uickly dispatch information from one country to another without much restriction. (rior to the mass usage of the Internet! such transfers of information would have taken longer to send! especially if done via snail mail! tele0! etc. .ecently! there has been a large emphasis on data analytics. ata can be mined from various sources such as online forms! mobile phone applications and more recently! social media.

ii.

(HC

The (roduct Hife Cycle ;(HC= is used to map the lifespan of a product. There are generally four stages in the life of a product. These four stages are the Introduction stage! the Irowth stage! the +aturity stage and the ecline stage. The following graph illustrates the four stages of the (HC4

&he .our Sta'es of the Product 0ife C)cle 1. 1ntroduction: &he 1ntroduction sta'e is *robabl) the ost i *ortant sta'e in the P0C. 1n fact2 ost *roducts that fail do so in the 1ntroduction sta'e. &his is the sta'e in which the *roduct is initiall) *ro oted. Public awareness is /er) i *ortant to the success of a *roduct. 1f *eo*le don3t know about the *roduct the) won3t 'o out and bu) it. &here are two different strate'ies )ou can use to introduce )our *roduct to consu ers. 4ou can use either a *enetration strate') or a ski in' strate'). 1f a *enetration strate') is used then *rices are set /er) hi'h initiall) and then 'raduall) lowered o/er ti e. &his is a 'ood state') to use if there are few co *etitors for )our *roduct. Profits are hi'h with this strate') but there is also a 'reat deal of risk. 1f *eo*le don3t want to *a) hi'h *rices )ou a) lose out. &he second *ricin' strate') is a ski in' strate'). 1n this case )ou set )our *rices /er) low at the be'innin' and then 'raduall) increase the . &his is a 'ood strate') to use if there are alot of co *etitors who control a lar'e *ortion of the arket. Profits are not a concern under this strate'). &he ost i *ortant thin' is to 'et )ou *roduct known and worr) about akin' one) at a later ti e. ". 5rowth: 1f )ou are luck) enou'h to 'et )our *roduct out of the 1ntroduction sta'e )ou then enter this sta'e. &he 5rowth sta'e is where )our *roduct starts to 'row. 1n this

sta'e a /er) lar'e a ount of one) is s*ent on ad/ertisin'. 4ou want to concentrate of tellin' the consu er how uch better )our *roduct is than )our co *etitors3 *roducts. &here are se/eral wa)s to ad/ertise )our *roduct. 4ou can use &6 and radio co ercials2 a'a7ine and news*a*er ads2 or )ou could 'et luck) and custo ers who ha/e bou'ht )our *roduct will 'i/e 'ood word$of$ outh to their friends8fa il). 1f )ou are successful with )our ad/ertisin' strate') then )ou will see an increase in sales. 9nce )our sales be'in to increase )ou share of the arket will stabili7e. 9nce )ou 'et to this *oint )ou will *robabl) not be able to take an) ore of the arket fro )our co *etitors. %. Maturit): &he third sta'e in the Product 0ife C)cle is the aturit) sta'e. 1f )our *roduct co *letes the 1ntroduction and 5rowth sta'es then it will then s*end a 'reat deal of ti e in the Maturit) sta'e. :urin' this sta'e sales 'row at a /er) fast rate and then 'raduall) be'in to stabili7e. &he ke) to sur/i/in' this sta'e is differentiatin' )our *roduct fro the si ilar *roducts offered b) )our co *etitors. :ue to the fact that sales are be'innin' to stabili7e )ou ust ake )our *roduct stand out a on' the rest. ;. :ecline: &his is the sta'e in which sales of )our *roduct be'in to fall. Either e/er)one that wants to has bou'ht )our *roduct or new2 ore inno/ati/e *roducts ha/e been created that re*lace )ours. Man) co *anies decide to withdrawal their *roducts fro the arket due to the downturn. &he onl) wa) to increase sales durin' this *eriod is to cut )our costs reduce )our s*endin'. 6er) few *roducts follow the sa e c)cle. Man) *roducts don3t e/en ake it throu'h all four sta'es. So e sta'es e/en b)*ass sta'es. .or e,a *le2 one *roduct a) 'o strai'ht fro the 1ntroduction sta'e to the Maturit) sta'e. &his is the *roble with the P0C. &here is no set wa) for a *roduct to 'o. &herefore2 e/er) *roduct requires a 'reat deal of research and close su*er/ision throu'hout its life. iii. *ny three pricing techni9ues for fi0ing the price of a new product category5brand

Cost #lus pricing Cost&plus pricing is the simplest pricing method. The firm calculates the cost of producing the product and adds on a percentage ;profit= to that price to give the selling price. This method although simple has two flaws@ it takes no account of demand and there is no way of determining if potential customers will purchase the product at the calculated price. This appears in two forms! full cost pricing which takes into consideration both variable and fi0ed costs and adds a percentage as markup. The other is direct cost pricing which is variable costs plus a percentage as markup. The latter is only used in periods of high competition as this method usually leads to a loss in the long run. Creaming or skimming In most skimming! goods are sold at higher prices so that fewer sales are needed to break even. Selling a product at a high price! sacrificing

high sales to gain a high profit is therefore EskimmingE the market. Skimming is usually employed to reimburse the cost of investment of the original research into the product4 commonly used in electronic markets when a new range! such as J players! are firstly dispatched into the market at a high price. This strategy is often used to target Eearly adoptersE of a product or service. ?arly adopters generally have a relatively lower price&sensitivity & this can be attributed to4 their need for the product outweighing their need to economise@ a greater understanding of the productFs value@ or simply having a higher disposable income. This strategy is employed only for a limited duration to recover most of the investment made to build the product. To gain further market share! a seller must use other pricing tactics such as economy or penetration. This method can have some setbacks as it could leave the product at a high price against the competition. (imit pricing * limit price is the price set by a monopolist to discourage economic entry into a market! and is illegal in many countries. The limit price is the price that the entrant would face upon entering as long as the incumbent firm did not decrease output. The limit price is often lower than the average cost of production or :ust low enough to make entering not profitable. The 9uantity produced by the incumbent firm to act as a deterrent to entry is usually larger than would be optimal for a monopolist! but might still produce higher economic profits than would be earned under perfect competition. The problem with limit pricing as a strategy is that once the entrant has entered the market! the 9uantity used as a threat to deter entry is no longer the incumbent firmFs best response. This means that for limit pricing to be an effective deterrent to entry! the threat must in some way be made credible. * way to achieve this is for the incumbent firm to constrain itself to produce a certain 9uantity whether entry occurs or not. *n e0ample of this would be if the firm signed a union contract to employ a certain ;high= level of labor for a long period of time. In this strategy price of the product becomes the limit according to budget.