Q. 1. Discuss the different marketing concepts with its merits and drawbacks Ans: Marketing is a set of business activities that facilitate movement of goods and services from producer to consumer. It is an ongoing process of discovering and translating consumer needs into products and services, creating demands for them, serving the customer and his demand through a marketing programme of promotion and distribution to fulfill the company’s marketing goals in a competitive environment.It is evident that customer, his needs and wants are very important aspects of today’s marketing. Customer focus is the very essence of marketing and his viewpoints should be taken into account while making marketing decisions. In this era of rapid changes, it is marketing which keeps the business in close contact with its economic, political, social and technological environment and informs it of events and changes that can influence its activities.
American Marketing Association (AMA) offers the following definition of Marketing. AMA 2004) Definition: Marketing is an organization function and a set of process for creating, communications and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stake holders. The Chartered Institute of Marketing defines Marketing as: Marketing is the management process responsible for identifying, anticipating and satisfying customer requirements, profitably. Having understood what a Market is and what is Marketing, we will now look what is an exchange and the exchange process.The Exchange Process Today’s marketing system has evolved from the time of a simple barter of goods through the stage of a money economy to today’s complex marketing.
Throughout all these stages, exchanges have been taking place. In small town and villages there were artisans such as carpenters, weavers, potters blacksmiths, barbers and others such service providers who produced goods and services not only for their own consumption but also for exchanging with others what they could not produce but needed. This was barter system of exchange.
For a transaction to take place between two parties, it was necessary that there be needs and wants on both sides. The development of money came to act as a common medium, and the exchange process became very easy and convenient. Fig. below shows the exchange process under money economy in which products and services flow to the market from the producers and sellers and money, the value of the products and services, flow from the buyers to the sellers. Thus, exchange is an act of obtaining a desired product or service from someone by offering something in return.
This exchange process will continue as long as human society exists because satisfying one’s needs is the basic instinct of human beings and no one can produce everything that he /she needs. For an exchange process to take place, between two or more parties, few conditions have to be met. They are: 1.
Each party has something that could be of value to other party. 2. Each party has desire, willingness and ability to exchange. 3. Each party is capable of communicating and delivering. 4. Each party has the freedom to accept or reject the offer. Q.
a) What are the features and objectives of marketing research? [5 marks] b) Give a note on psychoanalytic model of consumer behaviour. [5 marks] Ans: Marketing research is an important component of the marketing information system. It is the function which links the consumer, customers and public to the marketer through information- information used to identify and define marketing opportunities and problems, generate, refine and evaluate marketing actions, monitor marketing performance and improve understanding of marketing as a process Features of marketing research:It is a systematic process – it has to be carried out in a stepwise and systematic manner and the whole process needs to be planned with a clear objective.
It should be objective- It is important that the methods employed and interpretations are objective. The research should not be carried out to establish an opinion nor should it be intentionally suited towards predetermined results. It is multi-disciplinary – Marketing research draws concepts from other disciplines such as statistics for obtaining reliable date and from Economics, Psychology and sociology for better understanding of buyers.Objectives of marketing research: Marketing Research may be conducted for different purposes. Based on how organizations use marketing research, objectives of marketing research can be described as follows: 1) To understand why customers buy a product 2) To forecast the portable volume of future sales or expected market share 3) To assess competitive strengths and strategies 4) To evaluate the effectiveness of marketing action already taken 5) To assess customer satisfaction of company’s products/ services Phychoanalytical model of consumer behaviour:The influence of social sciences on buyer behavior has prompted marketing experts to propound certain models for explaining buyer behavior. One among those is phychoanalytical model.
This model draws from Freudian Psychology. According to this model, the individual consumer has a complex set of deep-seated motives which drive him towards certain buying decisions. The buyer has a private world with all his hidden fears, suppressed desires and totally subjective longings. His buying action can be influenced by appealing to these desires and longings.
The psychoanalytical theory is attributed to the work of eminent psychologist Sigmund Freud. He introduced personality as a motivating force in human behaviour. According to this theory, the mental framework of a human being is composed of three elements namely, a) The id or the instinctive pleasure seeking element b) The superego or the internal filter that presents to the individual the behavioral expectations of society. c) The ego or the control device that maintains a balance between the id and the superego. The basic theme of the theory is the belief that a person is unable to satisfy all his needs within the bounds of society.Consequently, such unsatisfied needs create tension within an individual which have to be repressed.
Such repressed tension is always said to exist in the sub-conscious and continues to influence consumer behaviour. Q. 4 Briefly explain the bases for segmenting consumer markets along with examples.
Do you think these bases are required for market segmentation? Why? Ans: Market segmentation is the process of dividing a potential market into distinct sub-markets of consumers with common needs and characteristics. There are four bases of segmenting consumer markets ) Geographic segmentation: in this type of segmentations the market is divided into different geographical units such as nations, states, regions, cities or neighbourhoods. The company can operate in one or a few Geographic areas or operate in all but pay attention to local variations. For eg: In Bangalore the tabloid is known as Bangalore mirror where as it is Mumbai mirror in Mumbai. 2) Demographic segmentation: In this the market is divided into groups based on variables such as age, family size, family life-cycle, gender, income, occupation, education, religion, race, generation, nationality and social class.Some of the demographic variables used are: a) Age and life cycle stage: Consumer’s wants and abilities differ with age For eg: ‘Pepspdent kids’ toothpaste for small children. b) Gender: Products will be available according to the gender For eg: cloths, hair-styling, cosmetics and magazines c) Income: this is a traditional practice followed in product categories such as automobiles, clothing, cosmetics, travel etc.
For eg: bikes available for different commuters on the basis of the income level 3) Psychographic segmentation: In this segmentation, buyers are classified into different groups on the basis of life-style or personality and values. ) Life style: People have different life-styles and products they consume express their life styles. Many companies seek opportunities in life-style segmentation . but life-style segmentation does not always work. These segments are innovators, thinkers, achievers, experiencers, believers, strivers, makers and survivors.
b) Personality: When marketers use personality variables to segment the markets, they endow their product with brand personality that corresponds to consumer personalities. For eg: Raymond fabrics with the tag ‘The complete man’ ) Social class: It has a strong influence on the consumer preferences and the products they buy or consume. d) For eg: TATA Nano which can be affordable by middle and lower income groups 4) Behavioral segmentation or consumer response segmentation: In behavioral segmentation, buyers are divided into groups on the basis of their knowledge or attitude towards the use of or response to a product. Some of the behavioral factors are: a) Occasions: According to the occasions, buyers develop a need, to purchase a product.For eg: gold jewelleries offers gold schemes and promotions for Akshya Thrutiya, Diwali etc. b) Benefits: Buyers are classified according to the benefits they see form the products. For eg: Peter England positioned its wrinkle free trousers on the basis of benefit c) User status: Markets can be segmented into non-users, poterntial users, first time users and regular users of a product. For eg: some resorts believes that local fall into non-user category, affluent class comes into potential users, foreigners as first time users, rich people who frequently visits as regular users.
) Usage rate: markets can be segmented into light, medium and heavy product users. ` for eg: offers of 4peices for the price of 3individual piece. Here the company is interested in getting profits from sales volume rather than its selling price. e) Loyal status: consumers have varying degrees of loyalty to specific brands, stores and other entities. Buyers can be divided into hard-core loyals, split loyals, shifting loyas and switchers. In my opinion these basis are required for market segmentation.
These are useful to understand the needs of consumers, to adopt better positioning strategies, to allocate proper marketing budget, to prepare a better competitive strategy, to provide guidelines in preparing media plan of the company, to decide the offering in different segments that enhance the sales, to get more customized product, to identify niche markets, to provide oppurtunities to expand market and to encourage innovation. Q. 5. Mention the forces in micro and macro environment that are likely to influence an organisation’s working and functions. Is environmental scanning necessary for all organisations?