Assignment Code: AMK-01/TMA/2022-2023

Course Code: AMK-01

Assignment Name: Marketing

Year: 2022-2023

Verification Status: Verified by Professor

Maximum Marks: 100

Attempt all the questions:

Q1) What do you mean by market segmentation? Explain the importance of market segmentation. (20)

Ans) Market segmentation is a marketing technique that involves identifying certain customer groups in order to deliver particular goods or product lines to them in a way that appeals to their preferences. Market segmentation is a development of market research that aims to pinpoint specific customer groups in order to develop products and branding that appeal to the group. By identifying which items have the best odds of capturing a share of a target market and figuring out the best approach to get those products to market, market segmentation aims to reduce risk. This enables the business to improve overall efficiency by concentrating scarce resources on initiatives that yield the highest rate of return on investment (ROI).

Importance of Market Segmentation

Market segmentation acknowledges that not all customers share the same preferences, means of consumption, or needs. Market segmentation is significant because it aims to make a company's marketing efforts more strategic and focused, as opposed to broadly catering to all potential customers. A business can improve its chances of making sales and being more resource-efficient by creating specialised plans for certain items with target consumers in mind.

Implementing marketing segmentation requires time and money. Successful marketing segmentation strategies, however, can improve a company's long-term profitability and health. The following are a few advantages of market segmentation:

Increased Resource Efficiency: Marketing segmentation enables management to concentrate on particular customer or demographic groups. Marketing segmentation enables a targeted, precise approach that frequently costs less than a broad reach approach, as opposed to attempting to offer products to the entire market.

Stronger Brand Image: Management must think about how it wants to be regarded by a certain group of people due to marketing segmentation. Management must decide what message to produce after identifying the market niche. The fact that this message is intended for a specific audience suggests that a company's branding and marketing are more likely to be very deliberate. This can also have the unintended consequence of improving customer interactions with the business.

Greater Potential for Brand Loyalty: Marketing segmentation gives customers more chances to establish enduring relationships with a business. Customers may respond favourably to more direct, personable marketing strategies that encourage a sense of inclusion, community, and belonging. Market segmentation also boosts your chance of finding the ideal customer that fits your product line and demographic.

Stronger Market Differentiation: A corporation may pinpoint the precise message it wants to send to the market and to competitors thanks to market segmentation. By clearly stating how a business differs from its rivals, this can also aid in product differentiation. Management creates a specific image that is more likely to be memorable and specific than a general approach to marketing.

Better Targeted Digital Advertising: A corporation can implement more effective customised advertising methods thanks to marketing segmentation. This includes social media marketing strategies that target people of a certain age, area, or behaviour.

Examples of Market Segmentation

The products, marketing, and advertising that consumers utilise on a daily basis are all examples of market segmentation. The success of auto manufacturers depends on their ability to accurately identify market segments and develop products and marketing strategies that appeal to those segments.

Elite athletes, regular gym attendees, fashion-conscious women, and middle-aged men looking for quality and comfort in their shoes are just a few examples of the market segments that a sport shoemaker might identify. In every situation, the manufacturer's marketing knowledge of each market group enables it to create and promote items with a high appeal more successfully than it might by trying to appeal to a wider audience.

Q2) What is product life cycle? Discuss the various stages in the life cycle of a product. (20)

Ans) A product's life cycle is the period of time from when it is initially made available to consumers until it is discontinued. Introduction, growth, maturity, and decline are the four stages that make up a product's life cycle.

Professionals in management and marketing use product life cycles to assist them decide on advertising schedules, price points, expanding into new product markets, redesigning packaging, and more. Product life cycle management refers to these strategic means of a product's support. They can also aid in predicting when fresher goods will begin to supplant older ones on the market.

Stages in the Life Cycle of a Product

There are four stages of a product’s life cycle, as follows:

Market Introduction and Development: Creating a market strategy during this stage of the product life cycle entails spending money on marketing and advertising to inform consumers about the product and its advantages. Sales are typically slow at this point as demand is being built. Depending on the complexity of the product, how novel and original it is, how well it meets client wants, and whether there is any market competition, this stage may take some time to complete. There is plenty of evidence that goods can fail at this stage, preventing stage two from ever being reached, but a new product development that is tailored to client needs is more likely to succeed. Because of this, a lot of businesses opt to improve an existing product and market their own version rather than trying to reinvent the wheel.

Market Growth: A product is prepared to go on to the growth stage of its life cycle if it successfully completes the market introduction stage. Growing demand should encourage increased production and wider distribution of the product as a result. As the product takes off, the gradual expansion that characterised the market introduction and development stage abruptly accelerate. At this stage, rival companies might launch their own versions of your product on the market, either as exact replicas or with minor improvements. As the consumer has the option to shop elsewhere, branding becomes crucial to maintaining your position in the market. In the face of escalating competition, product availability and pricing become crucial considerations in sustaining sales. The life cycle now enters stage three, or market maturity.

Market Maturity: The price of creating and selling an existing product will go down at this time because the product is already well-established in the market. The beginnings of market saturation are evident as the product life cycle enters this advanced stage. After a large number of customers have purchased the product and competitors have emerged, branding, price, and product difference become even more crucial to maintaining a market share. Retailers will become stockists and order takers rather than attempting to market your goods as they might have in stage one.

Market Decline: The life cycle will eventually start to diminish as competition increases and other businesses try to imitate your success by adding more features to their products or lowering their pricing. Another factor that contributes to decline is when new developments replace your current product. For example, horse-drawn carriages fell out of favour when the automobile replaced them.

Since there is no longer any opportunity for profit due to market saturation, many businesses will start to move on to new endeavours. Of sure, some businesses may endure the downturn and keep selling the goods, but manufacturing will probably be on a smaller scale, and costs and profit margins may decrease. Consumers may also abandon a product in favour of a fresh substitute; however, this can occasionally be reversed when previous trends and fashions resurface to spark interest in a discontinued item.

In order to retain longevity in the market, a corporation might shift its product focus by evaluating a product in relation to market needs, competition, costs, and profitability.

Q3) Write short notes on the following: (4×5)

(a) Consumer Behaviour

Ans) The study of consumers and the methods they employ to select, use (consume), and discard goods and services, as well as the emotional, mental, and behavioural responses of consumers, is known as consumer behaviour. Understanding consumer behaviour is crucial for marketers because it enables them to better communicate with customers. They can close the market gap and pinpoint the items that are required and the products that are no longer in use by knowing how consumers choose a product. Marketing professionals can display their goods in a way that has the greatest influence on consumers by researching consumer behaviour. Understanding consumer purchasing behaviour is the key to connecting with, involving, and convincing potential customers to make a purchase from you. An examination of consumer behaviour should show:

1. What consumers believe and feel about various alternatives (brands, products, etc.); What drives consumers to select one choice over another; Consumers' buying and research activity.

2. How the environment (friends, family, media, etc.) affects how customers behave

3. Numerous factors frequently affect consumer behaviour. Marketers should research consumer buying trends and purchase behaviours.

Making a reservation at a restaurant is an illustration of consumer behaviour. Scheduling a reservation for a night out with friends just takes a short amount of time, however making one for an anniversary or a marriage proposal takes more thought.

(b) Trade Promotion

Ans) Trade promotions are marketing initiatives and benefits provided by brands and wholesalers to their business clients, primarily retailers and convenience stores (although those clients could also be other establishments like hotels, restaurants, and cafes), with the goal of boosting product sales through those channels and ultimately to consumers. Additionally, they work by energising retail and distribution channels so that they are proactive with their consumer-facing promotional efforts.

An Increase in Order Size: When done properly, trade promotions, according to research by Price Waterhouse Coopers, can boost your bottom line by 10% to 15%. To further service consumers, promotions expose products to your customers and may influence them to buy ones they ordinarily wouldn't. Additionally, it makes upselling and cross-selling products simpler.

Speeding up Order to Cash Cycles: Every business must operate swiftly, and FMCG firms are no exception. Your revenue will rise as a result of accelerating your sales, which will also optimise your supply chain and cut costs. Utilize the feeling of urgency or FOMO (fear of missing out) as a motivator to buy and accelerate sales.

Improved Profitability: FMCG businesses are constantly under pressure from thin profit margins and fierce competition. Trade promotions, however, are a true asset. Since the cost of goods is set and the cost of sales is pretty constant across all opportunities, increasing sales will actually raise your gross profit margins for each sales activity.

Improved Customer Loyalty and Building Relationships: Trade promotions are a tool or strategy that buyers can use to help them on their self-served buying journey in an era where internet channels are expanding and gradually replacing direct interactions with sales representatives, which is another crucial part of customer happiness.

(c) Ware housing

Ans) When you buy products from a manufacturer and store them before shipping them to another site for fulfilment, this process is known as warehousing. These items may be kept in a warehouse, a spare room, or other spaces. Everything relies on the volume of your inventory and the size of your company. If you run a small firm, you can choose warehousing without having access to transportation. Many benefits of warehousing are not immediately obvious. These consist of:

1. improved Inventory Accuracy: You can make more accurate future plans if you know how much inventory you have and how much you've moved.

2. Reduced Overhead Cost: A warehouse can invest more in future growth and cost-cutting as its operations are improved.

3. Better Staffing Levels: You may prepare for your personnel needs by anticipating how busy your company will be during the coming months.

4. Protection of Goods: It is crucial for a firm to have a storage facility that meets the needs of its products. Make sure your warehouse meets this requirement if you have perishable goods that need to be refrigerated.

5. Central Location: The time it takes to move goods between locations might be slashed when a warehouse is chosen that is close to a client or an industrial hub.

6. Superior Flow of Goods: Understanding the best warehouse layout and how to store items properly to move them quickly can improve the flow of commodities from maker to end user.

(d) Services

Ans) The reason services are specifically highlighted here is because it's commonly believed that marketing just pertains to items. It is important to keep in mind that marketing strategies and tactics are equally applicable to services, with a few minor changes in specific areas of decision-making. In terms of content, services and products are distinct. Services are discretely identifiable, fundamentally immaterial activities that satisfy consumer needs but are not always related to the selling of goods or other services.

Courts, for instance, provide a service. Hospitals, fire departments, police, and the post office are also. These aren't goods at all. to present a professional image in these institutions. The post office is criticised for delays, the police are frequently criticised, the fire agencies are generally commended, the hospitals may be criticised for neglect and high prices, and so on. Controlling service quality is obviously crucial for enhancing its reputation.

'Non-profit' organisations like museums and charity are another option to government or public sector enterprises. Despite being non-profit, they nevertheless need to make a profit in order to maintain their level of popularity. Marketing is necessary for the corporate and commercial sectors, including airlines, banks, hotels, and insurance companies, as well as for professionals like chartered accountants, management consulting firms, doctors, etc.

Q4) Differentiate between the following: (4×5)

(a) Publicity and Advertisement

Ans) The differences between Publicity and Advertisement are as follows:

(b) Selective Distribution and Exclusive Distribution

Ans) The differences between Selective Distribution and Exclusive Distribution are as follows:

(c) Broker and Commission agent

Ans) The differences between Broker and Commission Agent are as follows:

(d) Retailer and Wholesaler

Ans) The differences between Retailer and Wholesaler are as follows:

Q5) Comment briefly on the following statement: (4×5)

(a) Marketing is the most important activity of any business.

Ans) Marketing is considered to be the most important activity of the present-day business. Business would be regarded useless without it. The success of a firm is frequently equated with the effectiveness of its marketing. In addition to becoming so important to a firm, it also benefits the consumer, the growth of the economy, and society. Businesses have come to understand this function's many facets and importance throughout time, and a more complete perspective is now being taken. Marketing has evolved into specialised fields with its own distinctive characteristics, such as the marketing of consumer goods and services and industrial goods and services.

Marketing is a term that applies to both products and services, including banking deposits and loans, health services, investment advice, etc. The consumer, the firm, and society all benefit from marketing. Marketing generates profits for the firm, offers consumers useful goods and services, and helps society as a whole by facilitating economic redistribution, creating jobs, and raising people's standards of living. Marketing in developing economies differs from developed economies in some ways. It's possible that a growing economy won't see all the benefits of an advanced marketing system found in an established one.

(b) An effective system of physical distribution greatly helps a firm in achieving its marketing objectives.

Ans) The operations involved in handling and transporting items from the site of production to the point of usage are referred to as physical distribution. A strong physical distribution system is extremely helpful for a business in reaching its marketing goals. In addition to providing time and location utilities, it frees consumers from retaining extra inventory and lowers the cost of carrying inventory, transportation, and other related expenses.

An effective system of physical distribution greatly helps a firm in achieving its marketing objectives The first stage in managing an activity in a planned and organised manner is determining the objectives. This is true because the objectives act as a road map for developing a strategy to complete the work successfully. The strategy will depend on the goals that need to be met in the area of physical distribution as well. Therefore, it is crucial for the company to outline the main goals of the physical distribution system. Any physical distribution system's goal is to get the appropriate commodities to the right place at the right time for the lowest possible price. The two primary goals of an efficient distribution system in an organisation are therefore improved customer service and cost cutting.

(c) Finding an appropriate brand name for a new product is a tricky job.

Ans) The choice of brand name is a crucial choice. Any brand name is acceptable as long as it is distinctive, simple to read, write, pronounce, and recall, and has no unfavourable or negative connotations. For all of your products, you can either select a single-family brand name or give each one a unique brand. Each option has benefits and drawbacks, and there are enough examples of both success and failure to support your decision. Even the most obscure brand names can occasionally be successful while simple and catchy ones fall flat. Under the Trade and Merchandise Act, trade and merchandise marks in India can be registered to get legal protection for exclusive use.

Finding an appropriate brand name for a new product is a tricky job. It might be difficult, mostly for two reasons. First, the name needs to meet a number of marketing requirements. Second, the name shouldn't be one that another company is already using. Extensive research is required because of this. The issue of choosing a brand name does not have an easy answer. However, market analysts have produced a set of guidelines that should be followed when choosing a brand name as a result of significant research and prior experiences. One should check if the brand achieves the following features before choosing it.

1. A brand name ought to express, either directly or indirectly, some feature of the product, such as a benefit or function. For instance, the word "Burnol" alone suggests that the product has anything to do with bums.

2. A brand should stand out, particularly if the product necessitates it. For instance, the name "Chancellor" for a cigarette inspires images of prestige, influence, and a luxurious lifestyle.

3. A brand name ought to be simple to say and keep in mind. Vimal, Hamam, etc. are few examples.

4. It ought to be set up such that, if necessary, it may be legally protected.

(d) When a new product is launched in the market, the manufacturer enjoys flexibility in the matter of prise setting.

Ans) When a new product is launched in the market, the manufacturer enjoys flexibility in the matter of prise setting. The choice of price at this point will have long-term effects because a poor price might harm the product's demand and profitability. At this point, the company must focus more on long-term returns and profitability than on short-term gains. If the company is inexperienced and does not have access to data indicating the impact of price on demand, pricing a new product may become even more challenging.

When setting a new product's price, a seller has two options: either set a high first price and earn significant margins (known as market skimming pricing) or fix a low initial price to gain market share and generate significant revenue through high sales turnover. price for penetration. The seller may use a fixed price, one price for all customers, or maintain some pricing flexibility (variable pricing). Depending on the discussions (or agreement) between the seller and the customer in the event of flexible pricing. A final cost could be determined. A marketing manager's duties do not simply involve price setting. He might be forced to alter his pricing as a result of external factors or in response to a competitor's price shift. whatsoever strategy he chooses. Consideration should be given to potential responses from customers, other businesses, and the government.