MB0046 SET 2

Q.1 what do you mean by marketing functions? Briefly explain the important marketing functions. A: The delivery of goods and services from producers to their ultimate consumers or users includes many different activities. These different activities are known as marketing functions. Different thinkers have described these functions in different ways. Some of the most important functions of marketing are briefly discussed below:

Marketing Research and Information Management:

Marketers need to take decisions scientifically. Marketing research function is concerned with gathering, analyzing and interpreting data in a systematic and scientific manner. The types of market information could be analysis of market size and characteristics, consumer tastes and preferences and changes in them from time to time, channels of distribution and communication and their effectiveness, economic, social, political and technological environment and changes therein. A company can procure such information from specialized market research agencies, government or can decide to collect themselves.

Advertising and Sales Promotion:

Advertising is a mass media tool used to inform, persuade or remind customers about products or services. It is an impersonal form of communication targeted at a chosen group through paid space or time. Sales Promotion is a short-term incentive given to customers or intermediaries to promote sales. It supplements advertising and personal selling and can be used at the time of launching a new product or even during its maturity period.

Product Planning and Management:

A Marketer should identify the needs and wants of consumers, develop suitable products / services and make them available. Marketer is also required to maintain the product and its variations in size, weight, package and price range according to the changing needs and requirements of his customers. Information available through Market Research helps product management in taking appropriate decisions while planning the marketing efforts.

Selling:

This function of marketing is concerned with transferring of products to the customer. An important part of this function is organizing sales force and managing their activities. Sales force management includes recruitment, training, supervision, compensation and evaluation of salesmen. They need to be assigned targets and territories where they can operate. The salesmen interact with prospective purchasers face-to-face in order to sell the goods. The purchaser may be end customer or an intermediary, such as a retailer or a dealer.

Physical Distribution:

Moving and handling of products from factory to consumers come under this function. Order processing, inventory, management, warehousing and transportation are the key activities in the physical distribution system.

Pricing:

This is perhaps the most important decision taken by marketer, as it is the only revenue fetching function and success and failure of the product may depend upon this decision. Therefore, the decision regarding how much to charge should be taken such that the price is acceptable to the prospective buyers and at the same time fetches profits for the company. While deciding on the price, the factors to be considered are competition, competitive prices, companys marketing policy, government policy, and the buying capacity of target market etc.

Q.2 Define the term Brand Equity ? Discuss the components of Brand Equity. A: Brand equity is set of assets linked to a brands name and symbol that adds value to the product or service and/or that firms customer. Components of brand equity:

Brand Loyalty: Is consumer's commitment to repurchase the brand and can be demonstrated by repeated buying of a product or service or other positive behaviors such as word of mouth advocacy. True brand loyalty implies that the consumer is willing, occasionally at least, to put aside their own desires in the interest of the brand. This will help organization to reduce the promotion cost. For example, many girls in India use only Ponds products, though competitors products like Fa, Spinz, Cuticura, and Mysore Sandal are present in the market and vice versa.

Brand Awareness: The number of customers exposed to the brand name. Higher the brand awareness, higher will be the brand equity. Organizations put all the effort in the introduction stage of the product to create awareness among the customers. For example, Xerox Company has huge brand awareness since photocopier machines were introduced by this company and even today photocopies are referred as Xerox copies.

Perceived Quality: The customer perception about the actual quality level of the product. For example, when a customer purchases Levis jeans he knows that it indicates quality even though there are several cheaper brands of jeans available in the market.

Brand Associations: The attribute of the brand that customer associates with his/ her belief. A person may associate the brand for power, strength or protectiveness. For example,

a customer may associate Nike brand not just for sports shoes but also any accessory associated with sports. So, for him, Nike represents sports.

Q.3 Why are marketing channels indispensable? List the functions of marketing channels. A: Marketing channels are a set of independent organizations comprising of the marketing intermediaries who are involved in the distribution of the goods or services from the factory to the consumption points at the right time or even before the time. Functions of marketing channels: Helps in Physical distribution: Transporting goods and storing them in the assigned warehouses or godowns. Promotes Communication: Marketing intermediaries promote the companys products. Here channel member provides the information regarding the products and pushes it to the customers. Provides Information: Retailers and wholesalers collect the information or feedbacks from the customers and provide the same to the company or manufacturer. Plays a key role in Title transforming: Marketing intermediaries purchase the goods from the company and transform the title of goods or ownership to the next channel intermediary or customer. Supports Relationship management: Here marketing intermediaries try to understand the needs of consumers, try to match his needs and satisfy them.

Q.4.Explain the different methods which allows a media planner to decide budget allocation A: Media vehicle selection, number of insertions and message structure depend on the budget allotted for the communication program. A popular channel may charge more for advertisement but organization gets better viewership. A newspaper having high circulation charges premium for the advertisement but all the organization may not have enough budgets to support such campaign. Hence marketer would like to decide what is the budget for the communication program? And how shall it be allotted optimally? There are four different methods on which a media planner decides the allocation of advertisement budget.

Affordable method: This method is used by small companies who dont have enough communication budgets. In this method company allots the fixed amount for the communication program. The advantage of this method is company can have better control over the spending on the communication. The disadvantage is if sales require higher communication effort, company is not in a position to allocate the budget.

Percentage of sales method: In this method company allots the budget on the basis of total sales forecasted. This is the simplest method. Marketer can have better control over the budget and also have flexibility to allocate the budget.

Follow the Competitor method: The Company sets its promotion budget on the basis of competitors advertising effort. Here company closely monitors the developments of the competitors communication program and study the industry trends in communication budget prior to setting up communication budget.

Objective and task method: The procedure involved in estimating the advertisement budget by this method are First, Objectives are set for the communication programs. Second, identifying the task to be performed to achieve the objective and third, estimating the cost of achieving these objectives.

Q.5 Define the term direct marketing Explain the different methods adopted for direct marketing A: When the company or organization is involved in marketing activities (usually selling products) without the use of any intervening media or channel, then it is called as Direct Marketing. The company directly sells its products to the final consumer and the consumer is expected to respond immediately or at the earliest. Direct marketing is sometimes called as B2C marketing for example, direct factory shoe sale. Following are the methods of Direct Marketing:

Direct mail: It is the most common method used in direct marketing, it involves sending postal mails to the consumers address and consumers maybe randomly chosen or specifically selected as targets. For example, credit card applications forms sent by banks, travel guides or manuals sent by tour operators, free trial packs of products sent by companies, subscriptions offers for magazines etc.

Telephone marketing: Telephone marketing is used to sell the product directly to consumer. The growth of BPOs in India fuelled the development of telephone marketing. In the case of BPOs, two types of verticals exist. They are inbound call center and outbound call center. In case of inbound call center, customer is given a toll free number for enquiry and executives try to sell the product to such customers. In out bound call center employees call the customers and sell the products. The expansion of Indian telecommunication industry and its cheapest tariffs in the world attracted domestic sellers to use this type of channel.

Catalogue marketing: According to Philip Kotler, catalogue marketing is direct marketing through print, video or electronic catalogues that are mailed to select customers, made available in stores or presented online. The growth of catalogue marketing in India is in a nascent stage. The notable example in this type of marketing worldwide is J.C. Penny.

 Kiosk marketing: Organizations spreads the information and keep ordering machines called kiosks in the shopping malls and other places. For example, Ambi Pur a perfume company recently organized a kiosk related marketing campaign in the Nirmal life style Mumbai. Company used inflatable as shown in the pictures to attract the small boys. Parents who came along with their children stopped at Kiosk and got the information from the company. The objective of campaign was to create awareness about the product among the target customers.

Online marketing: Marketing the organizations product on the virtual medium using the company websites as selling point or ordering point for the consumers. Sometimes companies use e-mails to offer their products and make a sale to the prospective consumers or even existing consumers.

Q.6 List the important differences between International marketing and Domestic marketing. A: International marketing is defined as The performance of business activities designed to plan, price, promote and direct the companys flow of goods and services to consumers or users in more than one nation for a profit. A company that wants to sell their product in other than domestic market should understand the environmental factors, consumer behavior, market forces and other characters relevant to the international market. After understanding the definition, several questions may arise in your mind like why marketer should go to the international market? And what is the difference between international marketing and domestic marketing? As we discussed in the introduction part, companies enter into the international market to tap the potential, to support the customer requirements or to avoid the unprofitable domestic market. The differences between domestic marketing and international marketing are listed below:

Characteristics Culture Data accessibility Data reliability Control Consumer preferences Product mix Business operation Currency exposure

International Marketing Multi culture Very difficult Very Low Difficult Vary from country to country Adaptability required More than one country Required

Domestic Marketing Single culture and in some cases multi culture Easy High Relatively easy Vary in small extent Standardization required Home country only Required only if there is importing