Friday, December 26, 2014

AHSEC - 12: Marketing Management Important Notes for Feb' 2017 Exam

Unit – XI: Marketing
Objective Questions (1 Mark):
1. Define market in Traditional marketing sense?
Ans: In the traditional sense, the market means a place where buyers & sellers gather to enter into transaction involving the exchange of goods & services. But in modern sense, market refers to meeting of buyers and sellers at a place, by telephone or by internet etc.
2. Define Marketing.                      2012
Ans: Marketing is a social process whereby people exchange goods & services for money or for something of value to them.
3. What is marketing research?
Ans: It means application of resource of research process in solving the marketing problem.
4. What is marketing mix?                           2013
Ans: It refers to the combination of four basic elements product, price, promotion and the place, known as the four P’s of marketing.
5. What is trademark?                   2014
Ans: Trademark simply means mark of a trade carried on by an identified entity. It is usually a sign mark or a symbol, word or words.
6. What is a product?
Ans: It means good or services or anything of value which is offered to the market for exchange.
7. What is advertising?
Ans: It is an impersonal form of communication which is paid for by the markets to promote some goods or services.

8. Define sales promotion?
Ans: Sales promotion refers to short term incentives other than advertising and personal selling at stimulating markets demand for product.
9. What is package?
Ans: The container which carries the product is called package.
10. What is packaging?
Ans: Packaging is defined as a set of tasks or activities which is concerned with the design and production of an appropriate container for the product
11. What is Marketing Management?
Ans: Marketing management is an important functional area of business. It is the process of planning, organizing, directing and controlling the activities related to marketing of goods and services to satisfy customer’s needs & achieve organisational goals.
12. Which Marketing philosophy gives more importance to “Consumer welfare” instead of “Consumer Satisfaction”?
Ans: Societal marketing                                 2015

SHORT QUESTIONS (2/3/5/8 Marks)
1. What are the important features of Marketing?
Ans:  Features of Marketing
a)      Need and want: Satisfaction of the needs and wants of individuals and organisations.
b)      Creating a market offering: Complete offer for a product of service.
c)       Customer value: greatest benefit or value for the money.
d)      Exchange mechanism: Exchange of products / services for money / value.
2. What are various functions of Marketing?  2012, 2014
Ans: Functions of Marketing / Marketing activities
a)      Marketing research : Gathering and analysing marketing information i.e. what the customers want to buy, when they are likely to buy in what quantities do they buy, from where do they buy etc.
b)      Marketing planning: Specific plan for increasing the level of production, promotion of the products etc and specify the action programmes to achieve these objectives.
c)       Product designing and development; Marketer must take decision like, what-product? Which model / size? Brand name? Packaged? Quality level? So that customer needs are satisfied.
d)      Buying & assembling: e.g. car. Raw material like steel, tyres, batteries, seats, stearing wheels etc are bought & then assembled in the form of a complete product.
e)      Packing / labeling: designing the package & labeling.
f)       Branding: Creating a distinct identity of the product from that of competitors e.g. Videocon washing machine.
3. What is marketing mix? What are its elements (4 P’s)? What are its features?  2012, 2013,
Ans: Marketing mix prefers to one of the major concept in modern marketing according Philip Kotler “marketing mix is a set of controllable marketing variables that the firm blends to produce the response it wants in the target market”.
It is the combination of four controllable variables which constitutes the company’s marketing system. The four controllable variables are:
Ø  Product
Ø  Price
Ø  Promotion
Ø  Place
These elements are inter related and inter dependent since decisions in one area usually actions in other area.
Features of marketing mix:
a)      Combination of four controllable variables: Marketing mix is the combination of four variables inputs namely product, price, promotion and place that constitute the core of organizations marketing system
b)      Inter relation of variables: The four P’s of marketing mix are interrelated and independent as the decision of one area automatically depends upon the other.
c)       Managerial activity: Marketing mix is a managerial activity i.e. it is the responsibility of the marketing manager to combine. The four ingredients in the right proportion as to achieve optimum results.
d)      Dynamic concept: Marketing mix is a dynamic concept as the need of constant as per the changes taking place in the marketing environment.
4. What is meant by channel of distribution? What are its various types? What are the factors affecting choice of channel of distribution?                2013,
Ans: A channel of distribution is an organised net-work or a system of agencies and institutions which, in combination, perform all the activities required to link producers with users and users with producers to accomplish the marketing task.
According to Philip Kotler, “The distribution is the set of all firms & individuals that assist in the transferring the little of goods & services as they move from producers to customers.”
Types of Channels of Distribution:
A) Direct Channel -     Manufacturer - Customer
B) Indirect Channel - Manufacturer - Retailer - customer
Manufacturer - wholesaler - Retailer - customer
Manufacturer - Agent - wholesaler - Retailer customer
Factors Affecting the Selection of the Channel of Distribution
A. Factors Pertaining to the Product: The following factors concerning the product, affect the selection of the channel of distribution: (1)   Price of the Product. (2)   Perishability. (3)   Size and Weight. (4)   Technical Nature. (5)   Goods Made to Order. (6)   After-Sales Service.
B. Factors pertaining to the Consumer or Market: The following are the main elements concerned with the consumer or the market: (1)   Number of Customers. (2)   Expansion of the Consumers. (3)   Size of the Order. (4)   Objective of Purchase. (5)   Need of the Credit Facilities.
 C. Factors Pertaining to the Middlemen: The following are the main factors concerned with the middlemen: (1)   Services Provided by Middlemen. (2)   Scope or Possibilities of Quantity of Sales. (3)   Attitude of Agents towards the Producers' Policies. (4)   Cost of Channel of Distribution.
D. Factors Pertaining to the Producer Or Company: The following factors, concerning the producer, affect the selection of the channel of distribution: (1)   Level of Production. (2)   Financial Resources of the Company (3)   Managerial Competence and Experience.
E. Other Factors (1)   Distribution Channel of Competitors. (2)   Social Viewpoint (3) Freedom of Altering.
5. Write a Brief note on modern marketing concept.
Ans: Modern marketing concept: Modern or new concept of marketing is a broader concept. It does not mean to provide consumer goods and services what the seller manufactures but it consists the process of discovering the consumer and converting their wants into appropriate goods and services. There are six concept of marketing which the companies keep in mind:
i) Production concept: As per this concept, companies assume that consumer will always respond to the product made available to them.
ii) Product concept: As per this concept companies realize that the quantity of the product is not sufficient, it is the product quality which is also very important.
iii) Selling concept: Now a days, as the technology advances along with the quantity and quality of the goods, the art of selling the goods are also very essential.
iv) Marketing concept: As consumer is treated as “KING” today. So it is essential for the company to produces and markets the product which the consumer wants. It focuses on consumer satisfaction.
v) Consumer concept: As per this concept, companies’ aims at providing consumers separate offers or services. This is possible through one to one marketing.
vi) Societal marketing concept: This concept requires that company should deliver superior value to the consumer to improve the consumer and the society. It focuses on consumer welfare.
6. What is advertising? Explain its role and Limitations.  2012, 2013, 2014
Ans: Advertising: It is the most commonly used tool of promotion. It is an impersonal form of communication, which is paid by the marketers (sponsors) to promote goods or services. Common mediums are newspaper, magazine, television & radio.
Advertisements play a very important role in offering innumerable benefits to the manufacturers, customers and to the society in general. Following are the benefits of Advertisements:
1.       Advertisements attracts new buyers and maintains existing customers and to the society in general.
2.       Advertisements inform the consumers about the quality and uses of the product.
3.       Advertising also acts as an information service and educates the con­sumer. It enables him to know exactly what he wants and where to get it. 
4.       Advertising stimulates production and reduces the cost per unit. This reduction in the cost is generally passed on to the consumer.
5.       Advertising also makes it possible to sell direct to the consumer by Mail Order Business. 
6.       Advertising helps in creating goodwill, brand image and brand loyalty.
7.       Advertisements help the retailers in selling the advertised products.
8.       It is also helpful in getting better employees and executives.
7. What is personal selling? What are its features? What are the qualities of a good salesman? Explain the importance of personal selling to customers?                                 2016
Ans: Personal selling is the act of presenting of product or services so that the consumer appreciate the need for it and mutually satisfactory sales follows.
Features of Personal selling:
a)      Personal contact is established under personal selling.
b)      Oral conversation.
c)       Quick solution of queries.
d)      Receipt of Additional Information.
e)      Development of relationship.
Qualities of a Good salesman:
a)      Physical Qualities : Physical qualities include personality health, stamina and tolerance
b)      Mental Qualities: These include mainly skill, mental alertness, imagination and self confidence.
c)       Social Qualities: These include social-abilities tact, sound character, and sweet nature.
d)      Vocational Qualities: It includes mainly knowledge of product, knowledge of competitive product, training and aptitude.
Importance of Personal Selling:
Personal selling plays a very important role in marketing of goods and services. It is important tool for businessmen, customers and society.
a)      Importance to Businessmen: Personal selling is an important tool to increase the sale. It is important for businessman due to following reasons:
Ø  Effective Promotion Tool: Personal selling is an effective tool to increase the sale of product. Salesmen explain the merits and products to customers.
Ø  Flexible Tool: Personal selling efforts can be changed according to the type of customer salesmen are attending. They may change the offer in varying purchase situations.
Ø  Minimum Wastage of Efforts: As compared to other methods of promotion in personal selling the wastage of efforts is minimum.
Ø  Relationship: Personal selling helps to create lasting relationship between customers and sales-persons which help in increasing sale. 
b)      Importance to Customers: Personal selling is very important from customer’s point of view, as customers can get required information about the product from customers. Customers are benefits by personal selling in the following ways:
Ø  Helps in Identifying Needs: Salesmen help the customers to discover their needs and wants and they also help customers to know how these needs and wants can be satisfied.
Ø  Latest Market Information: In personal selling salesmen provide information regarding the new products available in market, uses of those products etc.
Ø  Expert Advice: Customers can get expert advice and guidance in purchasing various goods and services.
Ø  Induces Customers: Personal selling induces customers to buy products for satisfying their needs.
c)       Importance to Society: Personal selling brings following positive effects for society:
Ø  Converts Latest Demand into Effective Demand: Personal selling create effective demand which results in increasing sale and more income.
Ø  Employment Opportunities: Unemployed youth can work as salesman and earn their livelihood.
Ø  Career Opportunities: Personal selling offers attractive career with job satisfaction and security.
Ø  Mobility of Sales Persons: Sales people move from one place to other, this promotes travel and tourism industry.
Ø  Product Standardization: With the help of personal selling there can be uniformity of consumption by supplying standardized products.
8. What is Branding? Write the characteristics of goods brand name. What are its Advantages?   2016
Ans: It can be designed as the process of using a name term, symbol or design to identify a product. It is simply giving a name / a sign / a symbol etc to a product. For example: Pepsi, Nike etc.
The following features of goods brand name are given below:
a)      The brand name should be short, easy to pronounce, spell, recognize and remember.
b)      The brand name should be distinctive.
c)       It should be capable of being are registered and protected legally.
d)      The brand name should be sufficiently versatile to accommodate new products, which are added to the product line.
Advantages of Branding:
a)      Brand name helps in advertising in an easier way.
b)      Brand name establishes permanent identity of the product.
c)       Branded products can be easily identified by consumers.
d)      Brand name promotes repurchasing.
9. What is a labeling? What are its Functions?
Ans: A label identity is the product or brand. Labels are attached one to the product package to help the identification and provide some identity to the customer.
Function of Labeling:
a)      Describe the product and specify its contents.
b)      Grading of Product
c)       Identification of the Product or Brand.
d)      Help in promotion of Product.
e)      Providing information required by law.
11. Explain sales promotion techniques: (a) Rebate (b) Product combination (c) Lucky Draw (d) Contest (e) Discounts 2012
Ans: (a) Rebate: - Sometimes, the product is made available at special prices less than the original prices for a limited period of time, e.g., recently Coke and Pepsi announced special price of their 500 ml bottles.
(b) Product Combination: - Product combination is the bonus items given free with the purchase of a product. For e.g. A milk shakers along with Nescafe, or mugs with Bourn vita or a diary along with a packet of chips. They are effective in getting consumers to try a new product.
(c ) Lucky Draw:- A firm of purchased of a fixed amount gives a coupon to a customer which entitles them for a lucky draw, e.g., Bikanerwala restaurant in particular season gives lucky draw coupon on purchase of Rs. 200 or more to its customers which entitles them to win exciting prizes like car etc.
(d) Contests: - In these, consumer’ are required to participate in some competitive event involving application of skills or luck and winners are given some rewards. For instance, Golden Harvest, maker of premium bread usually has children drawing competition.
(e) Discounts: - These are like price promotion in which certain percentage of price is reduced as discount from the list price, e.g., most of the retailers of garment like Snow White and Shopper’s Stop offer their product at generous discount during a limited period at the end of the season.
12. Differentiate between Marketing and Selling. Or Selling is Product oriented and Marketing is Customer orientated.
Ans: Difference between selling & marketing concept                    2014
Selling
Marketing
Selling starts with the seller & the needs of the seller.
Marketing starts with the buyer & needs of buyer
Seeks to quickly convert products into cash.

Seeks to convert customer ‘needs’ into products

Seller is the centre of business universe.

Buyer is the centre of the business universe

Views Business as a goods producing process.
Views businesses as a customer satisfying process.
Seller preference determines the formulation of marketing mix.
Buyer determines the shape marketing mix should take.
Selling is product oriented.
Marketing is customer oriented.
Seller’s motives dominate marketing communication.
Marketing communication is looked upon as a tool for communicating the benefits / satisfactions provided by the product.
13. What is meant by Packaging? Explain its functions and importance.                                2013, 2016
Ans: Packaging: It refers to the group of those activities which are related with the designing and production of the containers in which the product are packet.
Functions of Packaging
1. Product Identification: Packaging help in identification of the product.
2. Product Protection: The main function of the packing is to provide protection to the product from dirt, insect and breakage.
3. Convenience: It provides convenience in carriage, stocking and in consuming.
4. Product Promotion: Packaging simplifies the work of sales promotion.
Importance (Merits) of Packing:
a)      Rising standard of health and Sanitation: - As the people are becoming health conscious they take to buy packed goods. The reason is that the chances of adulteration in such goods are minimized.
b)      Self Service outlets: - Now a day’s self service retail shops are becoming very popular particularly in big cities. Because of this the role of sales assistants has gone to packaging.
c)       Innovational opportunity: - With the increasing use of packaging mote innovational opportunity becomes available in this area for the researches.
d)      Product Differentiation: - Packaging is helpful in creating product differentiation. The colour, material and size of package makes diff. in the perception of the buyers about the quality of the product.
14.  What is pricing mix? Explain the factors determining fixation of price.          2012, 2013, 2014, 2015
Ans: It refers to all those decisions which are concerned with the price fixation of any product or service. Factors determining Fixation of price:-
                i) Cost of the product: - Cost of the product is the main component of the price. No company can sell its product or service at less than the cost of the product. A Fixed and variable cost are to be considered for determining the price.
                ii) The utility and demand for the product: - Intensive study for the demand for product and service in the market is to be undertaken before the fixation of the price of the product. If demand is relatively more than supply, higher price can be fixed.
                iii) Extent of competition in the market: - It is necessary to take into consideration prices of the product of the competing firms prior to fixing the price. In case of cut throat competition it is desirable to keep price low.
                iv) Government & Legal Regulation: - If the price of the commodity and service is to be fixed as per the regulation of the govt., it should also be borne in mind.
                v) Pricing objective: - usually at the time of price fixation a certain amount of profit is added to the cost of the product. Objective is to earn higher profit, it may it may add amount of it.
                vi) Marketing method used: - Price also influenced by the marketing method used by the company. Example – Commission which is to be paid to the middlemen for the sale of the goods is also added to the price.
15. Differentiate between advertising and personal selling
Basis
Advertising
Personal Selling
Form
These are Personal.
These are impersonal.
Message
These are uniformity of message which means that the message is the same for the entire customer.
This message has no uniformity which means it can be changed keeping in view the behavior of the customer.
Flexibility
It lacks flexibility.
It is completely flexible.
Cost
It is relatively less costly method.
These are a most costly method.
Time
It takes a little time in conveying any information to the customer.
It takes more time in conveying any
information to the customer.
Media
TV, radio, newspaper & magazine.
Through salesman.
Feedback
This gives no information about the
reaction of the customer.
The reaction of the customer becomes immediately affect.
17. Explain 4 P’s of Marketing Mix.  2012, 2013, 2014
Ans: 4 P’s of Marketing Mix:
1) Product mix: Product is the starting point of all marketing activities. The product mix has the following dimensions: a) Product innovation and invention. b) Product features i.e., shape, size, weight, design, color, quality, standard etc. c) Product planning and development. d) Product range and mix etc.
2) Price mix: Price in decision is important from the point of view of the producer, consumer and seller. The product mix has the following dimension: a) Pricing policies b) Cost of production and profit margin c) Determination of per unit price. d) Discount, rebates and level of margins etc.
3) Promotion mix: Promotion means communication with customers to stimulate them to buy goods. The nature of promotion mix is determined by the marketing environment. There are various dimensions of promotion mix are: a) Advertising and publicity b) Personal selling techniques c) Sales promotion measures d) Public relation techniques etc.
4) Place mix: - place mix is also known as distribution mix. It is concerned with making the goods available to the customers at the places through a chain of marketing channels such as whole sellers, retailer’s middlemen and agents. The place mix has the following directions:  a) Type of intermediaries. b) Different marketing channels c) Physical distribution system etc.
18. What is promotion mix? Mention its various dimensions or elements? Also explain them.                 2015
Ans: Promotion mix: Promotion means communication with customers to stimulate them to buy goods. The nature of promotion mix is determined by the marketing environment. There are various dimensions of promotion mix are:
a.       Advertising and publicity
b.      Personal selling techniques
c.       Sales promotion measures
d.      Public relation techniques etc.
For explanation refer above.
19. Is advertising a social waste? Give your views? Or What are the limitations of advertisement?         2014
Ans: Several objections have been raised against advertising and some people criticize advertising as a social waste. The main point of criticism is as follows:-
a)      Creates Monopoly in the Market: Advertisement leads to promotion and cover mass level of customers at a time. Large firms can bear the advertisement expenditure but not the small firms, due to that it can eliminate the small firms from the market and creates its monopoly authority in the market.
b)      Higher the Prices of Product: Investment of money in advertisement leads to increase in the price of goods and services for which consumer has to face high prices and pay for it. Hence, more the advertisement cost- more the product cost.
c)       Misleading the consumers: Now days, advertisement misleads the consumers on false representation regarding their goods. Consumer attracts to those goods which are not necessary for them. Thus, advertisement misleads the consumer and sale goods to them.
d)      Wasteful Consumption by the Consumers: Advertisement attracts the consumers for wasteful products which are not necessary for consumers. Due to advertisement businessmen takes undue advantage from them. They sale unhealthy and artificial goods to them and exploits consumer emotions.
e)      Wastage of National Resources: There will be wastage of national resources, valuable stationary, time and energy used by the people or is ignored by them. Here, Valuable resources that can be used to create new industries are wasted in the production of needless varieties and designs.
20. What is product? What are its features? Mention its various classes.
Ans: It means good or services or anything of value which is offered to the market for exchange. A product is a set of tangible and intangible attributes including packaging, colour, price, quality and brand plus the services and reputation of the seller. A product may be a tangible goods, service, place, person or idea.
Essential features can be identified as given below:
(a) Tangibility: To be a product, it should have a tangibility character such as it can be touched or seen.
(b) Intangible Attributes: The product may also be intangible in the form of services.
(c) Associated Attributes: A product may have number of features which differentiate it from competitor’s products. Associated attributes usually cover the colour, package, brand name, installation instruction etc
(d) Exchange Value: It must be capable of being exchanged between seller and buyer at mutual agreed price.
(e) Consumer satisfaction: A product should have the capacity to satisfy consumer’s real or psychological needs.
Classification of Products
A. Products based on uses:
(i) Consumer Products: These are the products or services that are meant for final consumers for their personal, family or house hold use. These products are used by buyer for their consumption or selling but not for further processing. For example pen, watch, books, newspaper etc. Consumer products are further classified as Convenience goods, Emergency goods, Impulse goods, Shopping Goods, Specialty Goods, and Unsought Products.
(II) Industrial Products: Goods which are used for commercial production or in carrying of some business activities are known as industrial goods. It is for commercial use not for personal use.
B. Products based on durability: 
(I) Perishable products: These are the products which have very short life such as newspaper.
(II) Non-durable products: When the consumers start consuming or using the products, the products last for few uses and get depleted on consumption are non durable goods. For example, tooth paste, powder etc.
(III) Durable products: These are products which have a long life and consumers may use it for several years. For example - T.V., watch, furniture, mobile hand-set etc.
C. Products based on Tangibility:
(I) Tangible products: It must be capable of being touched, seen, verified its quality etc.
(II) Intangible products: A product may be intangible also but capable of providing satisfaction through its service.
21. What is physical distribution of goods? Mention its components. Explain the role of physical distribution.  2016
Ans: Physical Distribution of Goods: The channels of distribution are used by the firms to make the goods available at right place in right quantity. Whenever customer visits the market he expects all the goods and services he desires must be available there and these are made available in the market by producers with the use of various intermediaries. Physical distribution involves physical handling and movement of goods from place of production to the place of consumption. Physical distribution is also known as logistic management. In commercial sense it means the activities and decisions concerned with efficient movements of products and services.
Decisions in Physical Distribution/Components of Physical Distribution: There are four major activities involved in physical distribution of goods. There are the four major decisions which management has to take while providing physical distribution service:
a)      Order Processing: Order processing means the time and steps involved between taking order from customer and delivery of goods as per order. There is direct relation between the time taken in order processing and satisfaction of customer. Fast order processing gives more satisfaction to customer but this involves cost of maintaining sufficient inventory etc.
b)      Transportation: Transportation means physical movement of goods from place of production to place where they are required. Transportation adds value to the goods by moving them to place where these are required for example, Tea plantation is done in Darjeeling, Gangtok, Assam etc. but these are transported all over the country and the value of tea is much higher in other parts of country as compared to the place of production. There are various means of transportation available i.e. Rail, Road, Air, Pipeline, Water transport etc.
c)       Warehousing: Whatever is produced is not sold off immediately. Therefore every company needs to store the finished goods until they are sold in the market. Storage of goods is necessary because some goods like crops are seasonal in production but are demanded throughout the year so these have to be stored for supplying throughout the year.
d)      Inventory: Inventory refers to maintenance of stock of goods. The inventory needs to be maintained so that goods can be supplied whenever demanded. The proper inventory maintenance ensures product availability. But inventory also involves costs. These include cost of capital blocked in and risk of price fluctuation.
Significance or Importance of Physical Distribution Management:
The physical distribution of goods has assumed great importance particularly in recent years, because of the ever increasing competition for markets. The importance of physical distribution lies in the following directions:
1. It Creates Utilities Of Time And Place: By making available a product at the place where and when it is needed.
2. It Accounts For A Major Portion Of Marketing Costs: According to one estimate, physical distribution costs constitute as much 60% of the total marketing cost. Physical distribution is a very important area for cost savings. Over the years, in most businesses, physical distribution costs have grown into a sizeable portion of the total costs. Surprisingly, physical distribution despite being an important cost area, has remained one of the neglected areas for cost reduction. 
3. Bigger Share in the National Wealth: It represents large share in the national wealth in the form of facilities—rail, road, trucks, highways, aircrafts, ship, docking facilities, pipelines, storage facilities and equipment.
4. Specialisation It Facilitates Geographic Specialization: Each area produces goods that its natural resources, climate or pool of manpower resources enable it to produce more efficiently.
5. Determines Standard Of Living: This is so because proper distribution of products makes them available to a large number of people, at a relatively lower cost. Thus it can be said that physical distribution directly affects sales, customer service and satisfaction, and costs.

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