Glossary of Marketing

Terminology
7 O’S MODEL OF STUDY OF CONSUMER BEHAVIOR
Are:
Occupants- People
Objects- What Products
Objectives- Why
Occasions – When
Organizations- Who all are involved,
Operations- How do they buy (Cash/ Credit )
Outlet- From where to buy

80/20 RULE
It is a common rule of thumb in business; e.g., "80% of your sales
come from 20% of your clients."
Joseph M. Juran

ACHIEVERS
• Achievers are successful, goal-oriented people who focus on
career and family. They favor premium products that
demonstrate success to their peers. It is a type of psychographic
segmentation.
Phillip Kotler

• Achievers have high resources and are status oriented.

i) Seek recognition and self definition through achievements at
work and school.
ii) Value predictability and stability.
iii) Deeply committed to work and family.
iv) Social lives are centered around family church and career.
v) Image is important to them.
vi) They favor established prestige products and products that
demonstrate success to their peers.
vii) 73% married, 39% men, 77% college educated.
viii) Income around $200,000. Dr. Jill Novak

• These consumers are the high-resource group of those who are

motivated by achievement. They are successful work-oriented
people who get their satisfaction from their jobs and families.
They are politically conservative and respect authority and the
status quo. They favor established products and services that
 show off their success to their peers.
VALS Framework-USA

• Image is important to Achievers; they favor established,

productive products that demonstrate success to their peers.
Because of their busy lives they are often interested in a variety
of time saving devices. Bernie Hamilton-USA

Eg: BMW,Blackberry

ACCESSIBILITY
• Accessibility is the effective segmentation criteria, it means that
the segment be effectively reached and served.
Phillip Kotler
• To minimize promotion and sales expense you may want to
target urban rather than rural or local rather than national
prospects. Because the individual is more difficult to reach you
may want to segment by urban versus rural, train commuters,
people who read Wall Street Journal, etc.
Business Resource Software

ACTION CAMPAIGNS
• Action Campaign is:
1. Attract people of mass immunization.
2. Motivate people to say yes on a certain issue. Philip
Kotler
Eg: Treatment Action Campaign is a South African AIDS activist
organization

ADVERTISING
• Any paid form of non personal presentation and promotion of
ideas, goods and services by an undefined sponsor.
Philip Kotler
• Advertising is a form of communication intended to persuade an
audience (viewers, readers or listeners) to purchase or take
some action upon products, ideas, or services.
Stephen J. Eskilson
 • Advertising includes the name of a product or service and how
that product or service could benefit the consumer, to persuade
a target market to purchase or to consume that particular brand.
J. Walter Thompson
• The activity of attracting public attention to a product or
business, as by paid announcements in the print, broadcast, or
electronic media. Oxford Dictionary
Eg: Nike-Just do it.

ADVERTORIALS
• Print ads that offer editorial content that reflects favorably on
the brand and resemble newspaper or magazine content.
Philip Kotler
• An advertorial is an advertisement written in the form of
an objective article, and presented in a printed publication—
usually designed to look like a legitimate and independent news
story.
• An advertorial or infomercial is an advertisement designed to
simulate editorial content, while at the same time offering valid
information to your prospective clients.
• An advertisement promoting the interests or opinions of a
corporate sponsor, often presented in such a way as to resemble
an editorial. Oxford Dictionary

AFFILIATE MARKETING
• Affiliate marketing is a marketing practice in which a business
rewards one or more affiliates for each visitor or customer
brought about by the affiliate's own marketing efforts.
• Affiliate marketing overlaps with other Internet marketing
methods to some degree, because affiliates often use
regular advertising methods.
• Affiliate Marketing is an Internet-based business where affiliates
are compensated for each sale brought about by there affiliate
marketing efforts.

AGE AND LIFE CYCLE STAGES

 • Consumer’s wants and abilities change with age. Therefore,
age and life cycle stages are important variables to define
segment. Philip Kotler
• Classification of different age groups of a target market on
the basis of their life cycle stages,
because consumer needs and desires change with age. The
four basic 'Age and life cycle' categories are child,
young adult, adult, and older adult.
• Marketing concept that utilizes different marketing
approaches for different age categories or different life-cycle
segments of the population.
• Age and life-cycle segmentation The process of dividing the
consumer market into different age and life-cycle groups.
Eg: a vitamin manufacturer may offer a children's formula for ages
4-12, a vitamin specially formulated for young teenagers, an adult
version for adult men and women, and a high-energy formula for
people over age 50. Some marketers will offer a product designed
particularly for one specific segment of the age cycle, such as a
shampoo developed for women over 40 to help with age-related
hair changes.

ATTITUDES
• A person’s enduring favorable or unfavorable evaluation,
emotional feeling, and action tendencies toward some object or
idea. Attitude towards the product are: enthusiastic, positive,
indifferent, negative and hostile.
• An attitude is a hypothetical construct that represents an
individual's degree of like or dislike for an item.
• Attitudes are generally positive or negative views of a person,
place, thing, or event—this is often referred to as the attitude
object.
• Attitudes are judgments.
• Attitudes are usually defined as a disposition or tendency to
respond positively or negatively towards a certain thing (idea,
object, person, situation). They encompass, or are closely related
to, our opinions and beliefs and are based upon our experiences.
Eg: A person’s attitude towards green product ( Eco-friendly
product).

ATTRIBUTE POSITIONING
 •
The brand has a unique attribute i.e., Fastest, oldest, etc.
Attribute positioning is usually a weak positioning as it
does not explain the benefit to the customer.
○ Arun Kottoli
• Attribute positioning, the message highlights one or two of
the attributes of the product.
Philip Kotler
Eg: Bajaj Discover positions itself on its milage. 100 km in 1 litre.
BABY BOOMERS

• baby boomer and older customers (born between 1948-1965)

are the single largest consumer group in America, and they are
the wealthiest, best educated and most sophisticated of
purchasers. With more disposable income than any population in
America, they are, in fact, the New Customer Majority.
• Marketing and sales, for baby boomers, must integrate both
empathy and vulnerability (honesty and openness) into
marketing messages. These two attributes are necessary to build
trust, and are essential to optimal results in marketing and sales
communications.
• Eight Progressive Changes in How Baby Boomer’s Minds Process
Information:
➢ Less reliance on reason to determine what is of interest,
and more on intuition (which is cued by emotional
responses).
➢ Implications: identify and employ images that
promote strong positive emotional responses;
relationship building must precede presentation of
company and product; relationship potentialities are
primarily emotionally inferred (“gut feelings”) – rather
than rationally deduced.
➢ First impressions (which are always emotionally based)
are more durable and more difficult to reverse than for
younger adults.
➢ Implications: be sensitive to images that can stimulate
negative first impressions. It is probable that the
strongest sources of negative impressions are images
that conflict with idealized image of self, especially with
respect to autonomy and sense of personal validity.
➢ After a matter qualifies for interest and further
attention, baby boomers tend to want more information
than do younger consumers.
➢ Implications: manage the transaction continuum so
that emotional cues are present when most
advantageous, then shift to “hard” or objective
information when most advantageous; information
content must be no greater than what the baby boomer
wants at a given point in time.
➢ Decreasing speed in rational processing of objective
information.
➢ Implications: Deliver objective information (e.g.,
product benefits and features, technical information,
etc.) at a slow to moderate pace. Avoid “jump cuts” and
incomplete sentences.
➢ More resistant to absolute propositions.
➢ Implications: present information on company and
products in a qualified, even deferential manner.
➢ More sensitive to metaphorical meanings, nuances and
subtleties.
➢ Implications: take advantage of greater sensitivity to
subtlety to expand the content of the message,
especially in terms of metavalues – values that
transcend the generic value of the service and expand
its perceived attractiveness. Nonverbal symbols are
effective in accomplishing this.
➢ More receptive to narrative-styled presentations of
information, less responsive to information presented in
expository style.
➢ Implications: Make greater use of story-telling
techniques to get information across. Stories are
generally quicker to arouse emotions than straight-
forward propositions about a product’s features. Think
Hallmark Cards – they surpass most in using stories to
present products. Resistance to emotionally neutral
information (mainly processed in the left hemisphere of
the brain) increases in midlife. Storytelling has become
an important part of market strategy. Whoever tells the
best story and tells it best will most likely win.
➢ Perceptions are more holistic.
 ➢ Implications: Project an interest in the “whole” person,
not just the facet that might need a particular product
or service; also, avoid depicting representatives of
target markets in flat, single dimension contexts (e.g.,
simply showing consumers using or talking about the
product without reference to a larger context).
➢ Understanding how a baby boomer’s brain and mind
processes information is key to effective
communications. If an ad, TV or radio spot, web site or
sales presentation fails to connect with a baby boomer’s
idealized image of self, it is more likely to be ignored.

BACKWARD INVENTION

• Reintroducing earlier product forms that can be well adapted to

foreign country’s needs.
• Backward Invention is a product strategy in international
marketing in which a company produces a less complex version
of its domestic product for developing and less-developed
countries.
• Some countries might have a special need and this means that
you will have to develop a new product for their special need.
For instance, there may be a need for pure water in certain
countries and you invent a machine that purifies water.
• A product strategy in international marketing in which a
company produces a less complex version of its domestic
product for developing and less-developed countries.
• National Cash Register Company reintroduced its crank-operated
cash register at a lower cost for South American and African
markets. This is an example of backward invention.

Eg: Mcdonald’s mascot Uncle Ronald’s face is white in all the countries
except in Japan and other east Asian countries. There it is yellow and
Ronald is also known as Uncle Suk-Suk.

BALANCED INCOMPLETE BLOCK DESIGN (BIBD)

 • The Balanced Incomplete Block Design (BIBD) is a well studied
experimental design that has various desirable features from a
statistical perspective.
• This is a statistical tool, used to verify are assumptions and
observations and also to obtain new results.
• BIBD in marketing is:
➢ In some randomized block designs, it may not be possible
to apply all treatments in every block.
➢ For example, which type of marketing statergy to use for
a particular target market.
➢ The question is: Which tips are to be tested on the first
coupon, which on the second and so on, if information is
desired on all four tips ?
➢ A solution to this problem is: to use a balanced incomplete
block design.
➢ An incomplete block design is simply one in which there
are more treatments than can be put in a single block.
➢ A balanced incomplete block design is an incomplete block
design in which every pair of treatments occurs the same
number of times in the experiment.
➢ The number of blocks necessary for balancing will depend
on the number of treatments that can be run in a single
block.

BARRIERS:
• Majorly, two types of barriers:
➢ Entry barrier
➢ Exit Barrier from the market.
• Entry Barrier:
➢ The existence of high start-up costs or other obstacles that
prevent new competitors from easily entering an industry or
area of business.
➢ Barriers to entry benefit existing companies already operating
in an industry because they protect an established
company's revenues and profits from being whittled away
by new competitors.
➢ Although it goes against the practice of free trade, barriers of
entry do exist, even globally. Protectionism is one that comes
to mind. Many governments impose restrictive regulations
 such as high tariffs and quotas in order to protect local
businesses from foreign takeover.
➢ Types of entry barrier and methods to overcome them:
○ High Capital Requirements High capital
requirements are inherent in start-up businesses.
Financial resources can be a massive barrier especially
if a company is reliant on expensive raw material.
Again, financial planning is of the essence here. Small
companies have to learn to work within their means.
Financing for small-scaled businesses is, however,
available, but is incumbent on a strong business plan
with a reasonable but promising financial forecasts.
Applying for a loan from a bank / corporation /
consortium is possible but small companies have to
ensure that they factor in the costs in repayment into
their financial forecasts.
○ High Switching Costs and Product Differentiation
○ To increase customer sales, small-businesses have to
win over consumers from exisitng providers. This can be
expensive for customers as they may already be
comfortable with their current facilities and fees.
Similarly, high-scaled branding and advertising that
translates into product differentiation will entice
consumers to remain with their larger providers.
○ The way around here is to create a niche (pronounced
neesh, not nitch). A niche target market is a specific
group of consumers who have a specific requirement.
Small-businesses have to find their own niche product
or service that will be able to cater to this group of
people. Small companies are generally unable to reach
out to the masses, the same way established
companies are able to do - so they should concentrate
on building rapport with their own niche target markets
to boost their presence in the market. This allows
smaller companies to demonstrate their own expertise
and product branding.
 ○ Lack of Access to Distribution Channels
○ Small businesses have low bargaining power and
usually begin with shaky business networks. Because of
this, it is easy to lose out on business opportunities to
the big corporations in the market.
○ There are ways to overcome this hurdle. One way would
also be to concentrate on a niche product or service.
This would help eliminate the main competition with the
big players in the market. Alternatively, small
companies can find ways to "complement" the
networking channels (with their niche products and
services) to increase bargaining presence in the
industry.
○ Another popular way is the use of Internet marketing.
The Internet is a potent tool in today's business world,
especially where distribution channels are concerned.
Networking and marketing via the net is cost-efficient,
fairly non-technical and makes small business owners
accessible to billions. If the Internet marketing strategy
jives with the business model, small-firm owners may
quickly work their way up to larger distribution
channels.
• Exit Barrier:
Divestment can be an appropriate and profitable strategy, but the
decision to divest is complicated by the presence of several
barriers.
The portions of the capital investment that cannot be recovered,
sunk costs, create a barrier to exit
BEHAVIORAL TARGETING
• Behavioral Targeting is a technique used advertisers to increase
the effectiveness of their campaigns.
• Behavioral marketing can be used on its own or in conjunction
with other forms of targeting based on factors like geography,
demographics or the surrounding content.
Eg: Behavioral targeting uses information collected on an
individual's web-browsing behavior, such as the pages they have
 visited or the searches they have made, to select which
advertisements to display to that individual. Practitioners believe
this helps them deliver their online advertisements to the users who
are most likely to be interested.
Behavioral Targeting allows site owners or ad networks to display
content more relevant to the interests of the individual viewing the
page. On the theory that properly targeted ads will fetch more
consumer interest, the seller may ask for a premium for these over
random advertising or ads based on the context of a site.

BEHAVIORIST SEGMENTATION
Behavioral segmentation, marketers divide group on the basis of
their knowledge of, attitude towards, use of, or response to the
product. It is divided into 7 categories:
1. Occasions: Regular, Special
2. Benefits: Quality, service, economy, speed
3. User status: Non-user, Ex-User, potential-user, First-time
user, regular user
4. Usage Rate: Light, Medium, Heavy
5. Loyalty status: None, medium, strong, absolute
6. Readiness stage: Unaware, aware, interested, informed,
desirous, intending to buy
7. Attitude towards product: Enthusiastic, positive,
indifferent, negative, hostile.
Eg: Cadbury Celebrations, Bajaj Discover, Godrej Hair dye, Fair &
Lovely , Sny Electrical appliances, MTR Ready to eat food.

BENEFIT POSITIONING
• A positioning option that features a distinctive customer benefit.
Positioning is the process of designing a product or service so
that it can occupy a distinct and valued place in the target
consumer's mind, and then communicating this distinctiveness
through advertising. The key themes or concepts an organization
 features for communicating the distinctiveness of its product or
service to the target segment.
• Benefit positioning can be used if the brand perceivably differs in
its ability to deliver a specific benefit. The power of a benefit
position will depend on how many people care about the benefit
and how different the brand is in delivering it.
• There are seven qualities that help to make a successful
position:

1. Relevance
Positions that do not focus on benefits that are important to
people or reflect the character of the product will fail. Often in
their search for differentiation, marketers seize upon some
attribute in their product which is different but in reality is of little
concern to customers. This is a waste of time and money. The
lonely Maytag repairman, who symbolizes reliability, is an
example of a powerful position based on the quality built into the
appliances.
2. Clarity
A position should be easy to communicate and quick to
comprehend. Difficulty in either suggest that a position is to fuzzy
to be of value to the brand. “We try harder because we are #2”
established Avis as a major league competitor quickly and simply.
3. Distinctiveness
People have few needs that are unfulfilled, and they have many
choices to fill the needs they have. If a brand’s position lacks
distinctiveness it will be forced to compete on the bases of price
or promotion; expensive strategies that will not build brand equity
in the long term.
4. Coherence
Speak with one voice through all the elements of the marketing
mix if you wish to create a strong position. If, for example, a brand
that is positioned as premium quality and price appears in an end-
aisle “sale” display, its quality image will suffer. The shipping
cartons, freight pallets, envelope franking, packaging, advertising,
promotions, shelf displays etc. should all reflect and translate the
brand’s position into the appropriate form for the media.
 5. Commitment
Often people will get nervous when a strong position threatens to
ignore or even alienate some segment of the population as a price
of clearly communicating to the desired target. Once a position is
adopted, it takes commitment to see it through, in the face of
criticism and pot shots.
6. Patience
Crest has dominated its market for over thirty years. When it was
first introduced positioned as a cavity fighter its share never rose
above 13% for three years. The ADA approval was the key to
launching the brand to over 40% of the market. Had P&G lost
patience after two or three years, someone else would be
enjoying the profits of this powerful brand position.
7. Courage
It goes without saying that adopting a strong brand position
requires bravery. It is much easier to defend an appeal to
everyone with a rather generic sales pitch. You must believe that
the position makes strategic sense for the brand and then stick to
your guns.
• Adopting a strong position is not a passive act; rather it is a
deliberate attempt to influence events. It requires ignoring
certain business targets in favor of others, and if successful, will
yield growth in sales and profits and a consumer franchise who
believe that your brand has no adequate substitute, even if it
costs more.

BRAINSTORMING

• Brainstorming is a group creativity technique that was designed

to generate a large number of ideas for the solution of a
problem." Brainstorming business ideas should be uncensored.
No idea is dumb or impossible, and each person's contribution is
equally valuable. ( Thinkertoys Michael Michalko )
 • Brainstorming technique for breaking out and generating
innovative business, product, or service ideas is to get all of the
external senses involved. ( Thinkertoys Michael Michalko )

• Brainstorming is a group problem-solving technique that is

intended to help members develop innovative new approaches
to a problem in an unthreatening environment. ( Thinkertoys
Michael Michalko )

• Idea-generating technique often used in advertising by a

creative team to spark creativity. The team will gather in a group
and throw out spontaneous ideas without evaluation until they
hit upon something that may be useful. In this process nothing is
too silly or farfetched to be suggested. The process helps to
make the leap from the visualization of an idea to the concrete
words and pictures that will actually form the basis of the
advertising campaign. ( Thinkertoys Michael Michalko )

EXAMPLES

• VODAFONE ZOO-ZOO Ads which ultimately established as a

Brand is among the most creative ideas.
• i-Phone launches by Apple Inc are based on several new
technologies and concepts which is a result of various
Brainstorming activities.
• LCD & LED Televisions launched by Samsung is another example
of Brainstorming activities used by Samsung
• Yamaha-FZ 16 launched by Yamaha with broad tires at back in
the segment of 150 cc is also an example of Brainstorming
technique.

BRAND
• An identifying symbol, words, or mark that distinguishes a product
or company from its competitors. Usually brands are registered
(trademarked) with a regulatory authority and so cannot be used
freely by other parties. For many products and companies, branding
is an essential part of marketing. (Aaker, David (1991), Managing
Brand Equity.)

• A brand is a product, service, or concept that is publicly

distinguished from other products, services, or concepts so that it
can be easily communicated and usually marketed. A brand name
is the name of the distinctive product, service, or concept. Branding
is the process of creating and disseminating the brand name.
Branding can be applied to the entire corporate identity as well as
to individual product and service names. (Tom Peters)

• The intangible sum of a product's attributes: its name, packaging,

and price, its history, its reputation, and the way it's advertised.
(David Ogilvy's )

• Brand is the personality that identifies a product, service or

company (name, term, sign, symbol, or design, or
combination of them) and how it relates to key
constituencies: Customers, Staff, Partners, and Investors etc.

EXAMPLES

• Heinz is a leading global food manufacturer with a very strong

family brand. However, it also operates many well-known
individual brand names. Examples include Farley’s (baby
food), Linda McCartney Foods (vegetarian meals) and Weight
Watcher’s Foods (diet/slimming meals and supplements).
• Microsoft XP and Microsoft Office in personal computing
software and Heinz Tomato Ketchup and Heinz Pet Foods
• Mc Donald’s in India
 BRAND AFFINITY

• Brand Affinity is the likelihood to purchase a particular brand in a

free choice situation. It needs to be validated through consumer
behavior. (Neumeier, Marty )

• brand’s affinity relationship can be understood and managed by

focusing on three key aspects:
1. How well the product configuration delivers value – the
customer relevant, tangible product attributes and of course the
price being charged for them.
2. How well the service/experience has been delivered now and in
the past.
3. How well the brand reinforces the value proposition – its
attitudinal, emotional and social relevancy linkages. (Dave
Williams, President Loblaw Companies)

• Brand Affinity includes various aspects of consumer like

Ego , functional , Native , Empathy , Cosmopolitan ,
Emotional , Society and most important Association.

EXAMPLES

• Heineken is renowned for being the first truly international Beer

brand. The implication of Heineken is that it got affinity among
consumers over the world
• Benetton expressed the campaign featuring AIDS patients which
can strengthen the Brand emotional affinity

BRAND AMBASSADOR

• A promotional model is a person hired to drive consumer demand

for a product, service, brand, or concept by directly interacting with
 potential consumers. A promotional model can be female or male,
and typically is intended to be attractive in physical appearance

• "a diplomat; a representative of an organization, institution or

corporation that best portrays the product or service(Neumeier,
Marty )

• The brand ambassador is a marketing model that employs

trusted, credible personalities to promote and give greater visibility
to its brand products(Neumeier, Marty )

EXAMPLES

• Toyota has roped in actor Aamir Khan as its Brand

Ambassador for its utility vehicle Innova in India.

• Accenture - Tiger Woods (Golfer) with the Aim of talking about

precision.

• Brittania - Rahul Dravid (Cricketer)

• Santro - Shahrukh Khan (Bollywood Actor)

BUZZ OR STREET MARKETING

• Buzz marketing is a viral marketing technique that attempts to

make each encounter with a consumer appear to be a unique,
spontaneous personal exchange of information instead of a
calculated marketing pitch choreographed by a professional
advertiser (Lassar, W., B. Mittal and A. Sharma)

• The buzz Marketing campaigns, simply referred at as BUZZ, is an

expression tool used in a word-of-mouth marketing strategy or
manner. The Buzz marketing is a type of publicity spread among
customers and consumers in a positive society, causing an
 excitement and anticipation of the product or service(Lassar, W.,
B. Mittal and A. Sharma)

• Buzz marketing is a marketing technique consisting, as its name

suggests, of making a noise around a new product or offer. Similar
to viral marketing, it differs from it in the control of the content, of
the advertising message. (Lassar, W., B. Mittal and A. Sharma)

EXAMPLES

• The Dojo of Pain program served to create buzz and generate

awareness for the video game Red Steel, a launch title for the
Nintendo Wii platform

• BMW launched a series of eight high-cost, high-production short

films released on BMW's website. The films were produced and
directed by such acclaimed filmmakers as David Fincher and Guy
Richie and starred actors such as Don Cheadle, Clive Owen, and
even Madonna. Within the first four months of release, the films
attracted over 11 million views and sent BMW sells up 12% in
2001 alone. The success of the BMW series has prompted many
other car manufacturers such as Nissan to adopt a similar
internet-based strategy.

BRAND AWARENESS

• Extent to which a brand is recognized by potential customers, and

is correctly associated with a particular product. Expressed
usually as a percentage of target market, brand awareness is the
primary goal of advertising in the early months or years of a
product's introduction. (Lassar, W., B. Mittal and A. Sharma)

• Extent to which a brand is recognized by potential customers, and

is correctly associated with a particular product. Expressed
usually as a percentage of target market, brand awareness is the
 primary goal of advertising in the early months or years of a
product's introduction.

• Brand awareness is an important way of promoting commodity-

related products. This is because for these products, there are
very few factors that differentiate one product from its
competitors. Therefore, the product that maintains the highest
brand awareness compared to its competitors will usually get the
most sales. (Neumeier, Marty )

EXAMPLES

• NOKIA Brand awareness for its N-Series Mobiles

• Dove Brand Awareness for Dove Shampoo to gain market share

and reinforce market leadership position

BRAND EQUITY

• Brand equity refers to the marketing effects or outcomes that

accrue to a product with its brand name compared with those that
would accrue if the same product did not have the brand name
(Neumeier, Marty )

• Brand equity valuation requires association of elements like

changing market share, profit margins, consumer recognition of
logos and other visual elements, brand language associations made
by consumers, consumers' perceptions of quality and other relevant
brand values. (Neumeier, Marty)

EXAMPLES
• The Ford Motor Company made a strategic decision to brand all new
or redesigned cars with names starting with "F". This aligned with
the previous tradition of naming all sport utility vehicles since the
Ford Explorer with the letter "E".

• Christian Louboutin is a footwear designer who launched his line of

high-end women's shoes in France in 1991. Since 1992, his designs
have incorporated the shiny, red-lacquered soles that have become
his signature. Referring to the four consumer perception of brand
equity, Louboutin fulfills all four factors. With shiny, red-lacquered
soles and high stillettos that differentiate Louboutin from other posh
and luxurious shoe brands, Louboutin has lured women all over the
world who deemed themselves to be brand conscious consumers,
wearing only and only high-end fashion brand shoes.

BRAND IMAGE

• Impression in the consumers' mind of a brand's total personality

(real and imaginary qualities and shortcomings). Brand image is
developed over time through advertising campaigns with a
consistent theme, and is authenticated through the consumers'
direct experience

• The perception that consumers have of a brand. Brand image is

usually carefully developed by the brand owner through marketing
campaigns or product positioning

• The customer's net "out-take" from the brand. For users this is
based on practical experience of the product or service concerned
(informed impressions) and how well this meets expectations; for
non-users it is based almost entirely upon uninformed impressions,
attitudes and beliefs.

EXAMPLES
• Brand Image of Nike and ADIDAS by providing Sponsorship in
various sports events.

• Brand Image of Amul developed with the punch line that AMUL “The
taste of India “.

• Brand Image of VODAFONE by showing ads of Zoo-Zoo and Dog-Girl

Ads and focusing on best customer service

BRAND LEVERAGING

• 1>Broadening a company's product range by introducing additional

forms or types of products under a brand name which is already
successful in another category. Also called Product Leveraging,
Brand Extension and Franchise Extension.
• 2>A brand leveraging strategy uses the power of an existing brand
name to support a company’s entry into a new, but related, product
category. Brand leveraging communicates valuable product
information to consumers about new products. Consumers enter
retail outlets equipped with pre-existing knowledge of a brand’s
level of quality and consistently relate this knowledge to new
products carrying the familiar brand.

EXAMPLES

• 1>Bic is a strong brand name with years of experience in

marketing low-cost disposable plastic products such as the Bic
pen. Thus, Bic is positioned well to introduce products that
capitalize on these same basic strengths – products such as
disposable razors and cigarette lighters.
• 2> The manufacturer of Mr. Coffee™ coffee makers used its
brand name strength to launch Mr. Coffee™ brand coffee. While
coffee machines and coffee beans are in different product
categories, there is a strong enough correlation between the two
items that the brand name has a powerful impact on consumers
of both categories.
 • 3>. Ralph Lauren's Polo brand successfully extended from
clothing to home furnishings such as bedding and towels. Both
clothing and bedding are made of linen and fulfill a similar
consumer function of comfort and hominess.
• 4> Virgin Group, which was initially a record label that has
extended its brand successfully many times; from transportation
(aeroplanes, trains) to games stores and video stores such a
Virgin Megastores.

BRAND LOYALTY

• 1>Brand loyalty, in marketing, consists of a consumer's

commitment to repurchase or otherwise continue using the
brand and can be demonstrated by repeated buying of a product
or service or other positive behaviors such as word of mouth
advocacy.

• 2>Extent of the faithfulness of consumers to a particular brand,

expressed through their repeat purchases, irrespective of the
marketing pressure generated by the competing brands.

• 3>When consumers become committed to your brand and make

repeat purchases over time. Brand loyalty is a result of
consumer behavior and is affected by a person’s preferences.
Loyal customers will consistently purchase products from their
preferred brands, regardless of convenience or price.

EXAMPLE

• 1>Harley Davidson, the motorcycle brand in the US, is an

example of how passion among consumers has been
instrumental in reflecting the loyalty to the brand.

• 2> Apple customers have the brand's logo tattooed onto their
bodies.
 • 3>In Finland, Nokia customers remained loyal to Nokia because
they admired the design of the handsets or because of user-
friendly menu system used by Nokia phones.

BRAND MANAGEMENT

• 1>Brand management is the application of marketing

techniques to a specific product, product line, or brand. It seeks
to increase the product's perceived value to the customer and
thereby increase brand franchise and brand equity.

• 2>The process of maintaining, improving, and upholding a brand

so that the name is associated with positive results. Brand
management involves a number of important aspects such as
cost, customer satisfaction, in-store presentation, and
competition. Brand management is built on a marketing
foundation, but focuses directly on the brand and how that brand
can remain favorable to customers.

EXAMPLES

• 1>Coca-Cola has become a cliché of brand management. Before

branding or even management emerged as disciplines, the
Atlanta-based company was already spending over US$ 11,000
on a mass advertising campaign as early as 1892. Its trademark
was officially filed in the US that year and has consistently been
displayed with the same script to this day. Over time it also
associated its brand with a bright red color, the hour-glass
shaped bottle (1915) and the ribbon logo (1970). Together these
aspects contribute to differentiating Coke from rivals such as
Pepsi-Cola, which has applied a competitive pressure since 1898.

• 2>Cadillac's branding message extols the virtues of art and

science. Cadillac showcases proactive safety features; precision
all weather controls; and infotainment luxuries such as Onstar,
 the in-vehicle safety, security and information service that uses
Global Positioning System (GPS) satellite technology and wireless
communication to link the driver and vehicle to 24-hour real-
time, person-to-person

BUYERS

• A buyer is any person who contracts to acquire an asset in return

for some form of consideration.

• Party which acquires, or agrees to acquire, ownership (in case of

goods), or benefit or usage (in case of services), in exchange for
money or other consideration under a contract of sale. Also
called purchaser.

EXAMPLES

• For TIMKEN the gear manufacturing company the buyers will all the
Automobiles company and engine or Motor making companies

BRAND SWITCHING

• 1>Consumer decision to purchase a product brand different from

that previously or usually purchased. Brand switching can be
instigated by price promotions, in-store displays, superior
availability, perceived improvements or innovations in competitive
brands, desire for novelty, number of available brands, perceived
risk, frequency of purchase, changes in quality, or level of
satisfaction with the most recent purchase. Brand switching is most
common with products that have no great perceived variation in
quality across brands such as bottled water, dairy products, or
paper towels.
• 2>Brand switching refers to a consumer’s use of more than one
brand within a product category.

• 3>Brand switching is when a consumer or group of consumers

switches their allegiance from one brand of a certain type of
product to another.

CORPORATE BRAND

Definition1: It is the practice of using a company's name as a product

brand name .It is an attempt to use corporate brand equity to create
product brand recognition .Corporate branding is not limited to a
specific mark or name .Branding can incorporate multiple touch points.
These touch points include; logo, customer service, treatment and
training of employees, packaging, advertising, stationery, and quality
of products and services. Any means by which the general public
comes into contact with a specific brand constitutes a touch point that
can affect perceptions of the corporate brand.

Definition 2: Corporations around the world are increasingly becoming

aware of the enhanced value that corporate branding strategies can
provide for an organization. Branding in the classic sense is all about
creating unique identities and positions for products and services,
hence distinguishing the offerings from competitors.

Definition 3: Corporate branding is a serious undertaking that entails

more skills and activities than just an updated glossy marketing facade
with empty jargon. A corporate branding strategy creates simplicity; it
stands on top of the brand portfolio as the ultimate identifier of the
corporation.

Definition 4: A corporate brand can very often assist the corporation

and the management to focus in on the core vision and values. Once
this overall platform has been established and implemented, it serves
as a great stepping stone for revisiting any other brands in the
corporations’ portfolio to have a new approach to and look at its
various brand identities. This ultimately will lead to the final brand
architecture of the corporation and set the strategy for how branding
and brands will play an important role to achieve the corporate
objectives.

Examples:
• HSBC, which has successfully implemented a stringent corporate
branding strategy .HSBC employs the same common expression
throughout the globe with a simple advertising strategy based
on the slogan “The world’s local bank.” This creative platform
enables the corporation to bridge between many cultural
differences, and to portray many faces of the same strategy.

• Hewlett-Packard" Most people think we are just a printer

company," says Michael Mendenhall, H-P's chief marketing
officer. That's why H-P is launching a new corporate branding
campaign, according to The Wall Street Journal, "to recast itself
as a broader technology concern."

• Coke vs. a generic soda. Because Coca-Cola has built a powerful

brand equity, it can charge more for its product--and customers
will pay that higher price.

• WAL-MART offers low price and good values. They attract more
customers then other competitive brands. As their brand
strategy is to provide good quality products at reasonable price.

CORPORATE STRATEGY

Definition 1: Approach to future that involves (1) examination of the

current and anticipated factors associated with customers and
competitors (external environment) and the firm itself (internal
environment), (2) envisioning a new or effective role for the firm in a
creative manner, and (3) aligning policies, practices, and resources to
realize that vision.

Definition 2: Corporate strategy is the direction an organization takes

with the objective of achieving business success in the long term.
Recent approaches have focused on the need for companies to adapt
to and anticipate changes in the business environment, i.e. a flexible
strategy. The development of a corporate strategy involves
establishing the purpose and scope of the organization's activities and
the nature of the business it is in, taking the environment in which it
operates, its position in the marketplace, and the competition it faces
into consideration

Definition 3: It determines how resources are to be used to meet the

organisation's goals in the areas of production, finance, research and
development, personnel and marketing.

Strategic or institutional management is the conduct of drafting,

implementing and evaluating cross-functional decisions that will
enable an organization to achieve its long-term objectives. Is also
concerned with the firm's choice of business, markets and activities'
(Kay, 1996), and thus it defines the overall scope and direction of the
business.

Definition 4: It must convey a significant stretch for your company, a

sense of direction, discovery, and opportunity that can communicated
as worthwhile to all employees. It should not focus so much on today's
problems, which are normally dealt with by company visions and
missions, but rather on tomorrow's opportunities.

EXAMPLES
• At General Electric (GE) the corporate vision is 'We bring good
things to life'.The corporate success depends on the vision
articulated by the chief executive or the top management. For a
vision to have any impact of the employees of an organization it
has to be conveyed in a dramatic and enduring way.
• The Ford Motor Company vision is 'to become the world's
leading consumer company for automotive products and
services'.
• Bic Pen Corporation expanded beyond ballpoint pen production
into disposable cigarette lighters, it used the same plastic
injection moulding technology and similar distribution channels
to sell what was essentially another mass-marketed, disposable
consumer item.

COUNTER MARKETING
Definition 1:Advertising that takes a position contrary to an advertising
message that preceded it. Such advertising may be used to take an
opposing position on a controversial topic, or to counter an impression
that might be made by another party's advertising.

Definition 2: Counter marketing involves a marketer affirmatively

repudiating demand including through avoiding unwanted customers,
or preventing certain transactions. It is advertising that takes a
position contrary to an advertising message that preceded it.

Definition 3: Social marketers sometimes look at the methods that

have been used to sell things, and then they use same methods to
unsell them ,it means they encourage a change to positive behaviour
by same methods that have encouraged negative behaviour.

EXAMPLES

• TABACOO companies use counter marketing by showing various

types of ads and mentioning the harmful effects caused by
usage of the product .Instead of selling cigarettes, it promotes a
tobacco free lifestyle.

• TV ads for gambling and suicide help lines. "Social marketing is

the systematic application of marketing along with other
concepts and techniques to achieve specific behavioral goals for
a social good."

• IPCL sells it's products and at the same time it promotes "Save
Oil,Save India".

• Many paper manufacturing companies mention at the back of

their “product save paper save trees”.

CULTURE

Definition 1: Culture is the way that we do things around here.

Culture could relate to a country (national culture), a distinct section of
the community (sub-culture), or an organization (corporate culture). It
is widely accepted that you are not born with a culture, and that it is
learned. So, culture includes all that we have learned in relation to
values and norms, customs and traditions, beliefs and religions, rituals
and artifacts (i.e. tangible symbols of a culture, such as the Sydney
Opera House or the Great Wall of China).

Definition 2: Culture is small thing in the world of business. It’s often a

representation of the personality, beliefs and values held by the owner
of the business. It’s hard to fake and it’s hard to change. But, if you
can define it, mold it, and communicate it in ways that support a
positive brand experience, you might just be on to a very powerful
source of business.

EXAMPLES

• Coca Cola translating the name into Chinese without back-

translating it ("bite the wax tadpole"), ultimately resulting in a
horrible response from an insulted society.

• A coffee shop which serves pretty average coffee, but

customer’s drawn to visit them time and time again because the
owner of the business and every single person he finds to
employ are so darn nice and genuinely friendly that they want to
do business with them.

CUSTOMER FEEDBACK

Definition 1: Here the company actively solicits expressed customer

needs or feedback to improve its products.
Definition 2: Customer feedback is the process or specific instance of
providing information to businesses about products, services and
customer service. Management, marketing and sales departments can
all use customer feedback to streamline processes and improve
profitability.
Definition 3: Customer feedback should address the satisfaction level
of individual customers, as well as allowing room for customer
comments. Different types of customer feedback include surveys,
product or service review cards and telephone hot lines. Customer
feedback may be solicited or unsolicited by the company.

EXAMPLES

• National Express, one of the UK's leading travel companies

invites passengers to send text messages whilst riding the bus.
• Cisco and Microsoft Knowledgebase

• Dell have turned user feedback into an entire social network site,
complete with Ding-style voting, memberships, commenting and
all that jazz. It’s a master stroke .Now, if Dell want to know what
their users care about and are most hungering for, they just go
to this website and the front page lists the most requested
product and feature ideas in order of demand!

• Dominoes Pizza - This example is probably the most publicized

company example of surveying their customers to determine
how their product, in this case pizza, was being consumed and
how it would be better. The story continues that they re-
invented their crust and sauce due to a survey of customers and
they have changed drastically their product as a result. This
increased their bottom line.

• American Pacific Enterprises - This home textile

manufacturer is innovating by using customer feedback surveys
on the use of their products and perhaps ways to bring new
products to the marketplace. They can make better business
decisions based on the information their customers provide and
they are now thinking of doing this on a more local level.

CUSTOMER INTIMACY

Definition 1: Customer intimacy is based on the ability of the supplier

to become accepted and known as the regular partner.
Definition 2: It is one of the three disciplines in the Treacy-Wiersema
Value-Discipline Model on which an organisation may focus its
energies. This discipline is characterised by occupying only one (or a
few) high-value customer niches and being obsessive about
understanding the individual customers in detail.

Definition 3: A business strategy that focuses on the needs and wants

of a specific type of customer, and in which the business tries to
establish relationships with specific customers .

Segments and targets markets precisely .its builds customer loyalty for
the long term . Creating high barriers to entry ,empowers the people
actually dealing with the customer. Integrates business systems,
supply chain and roadmaps with the customer .Jointly develops
customizable solutions

Definition 4: Customer intimacy is the largest source of your growth,

sustainable competitive advantage, and profit. Everyone in your
organization should practice it.
Customer-intimate companies bring an entirely fresh perspective. They
discover unsuspected problems, detect unrealized potential, and
create a dynamic synergy with customers. They often merge their
operations with those of their customers. In the integration of their
operations, suppliers become more than merely useful: They become
indispensable.

EXAMPLES

• IDEO's Innovation build bridges from one department to

another, from your company to your prospective customers,
and ultimately from the present to the future
• Jack Welch's goal was to make GE "the world's most
competitive enterprise." Welch believed in trying to know every
employee and every customer, just like a village grocer. Welch
even nicknamed GE "the grocery store".
 • Nordstrom's and IBM. These companies win by understanding
their customers deeply and delivering exactly what they need,
often in a customized way.

CUSTOMER LOYALITY RESEARCH

Definition 1: Most businesses today recognize – or at least pay lip

service to—the importance of customers and their loyalty .Banners and
slogans say it. Advertising focuses on it. And customer service
departments have become a standard, to assure customers they care
and want to make things right. Customers make decisions about where
to spend their time, money, and effort daily, in fact, multiple times a
day. In any case, the scenario is always the same for the seller – to
make their product or service offering the preferred choice.

Definition 2: But loyalty is more than just behaviour .It is a fallacy to

assume that a customer is loyal just because they continue to buy
from you. There are many reasons why a customer repeats purchasing
which have little to do with being really loyal.

Definition 3: Loyalty can be defined as customers continuing to believe

that one organization’s products/services offer remains their best
option. It meets their value proposition whatever that may be. They
take that offer whenever faced with that purchasing decision.
Moreover, loyalty means hanging in there even when there may be a
problem because the organization has been good to them in the past
and addresses issues when they arise.

Definition 4: It means that they do not seek out competitors and,

when approached by competitors, are not interested. It also means
being willing to spend the time and effort to communicate with the
organization so as to build on past successes and overcome any
weaknesses. In a nutshell, loyalty means a customer wants to do
business with you and does.

Definition 5: Customer loyalty research is designed to help companies

identify why customers return, why they defect, and why they buy.
When customer loyalty market research is effective, it delivers key
insights including specific statistics on consumer loyalty that can help
demonstrate the attitudes and behaviors that effect loyalty

A customer loyalty program is a structured and long-term marketing

effort which provides incentives to repeat customers who demonstrate
loyal buying behavior.

EXAMPLES

• At Maritz, multidimensional loyalty research is designed to

provide comprehensive data and clear solutions. It’s not
surprising that our customer satisfaction consulting accounts for
over 20% of total customer satisfaction research expenditures in
the United States, because we deliver unparalleled, actionable
insights into customers’ attitudes, behaviors and demographics
again and again.

• Neiman Marcus is credited with creating the first customer

loyalty program in the retail industry, which is called "InCircle."

CUSTOMER MARKET

Definition 1: Customer market" is a term for the portion of available

customers who currently patronize a business, usually for a product or
service. Most frequently used in business marketing, a customer
market can sometimes be called the market or customer base for a
business. A customer market can grow and shrink due to changes in
the business environment. Maintaining a stable or growing customer
market ultimately depends on keeping the existing paying customers
of the business happy.

Definition 2: Customer marketing is designed to help a business

understand customer complaints by tuning in to the voice of the
customer. Businesses often give surveys to customers to get feedback
that gives them a clearer understanding of how customers think.
Keeping in tune with the desires, complaints and experiences relayed
by customers helps a business better streamline the customer
experience.

Definition 3: Consumer market consists of purchasers or individuals

in their households who personally consume or benefit from the
purchased products and who do not buy products primarily to make a
profit

EXAMPLES
• Ducati turned to events, PR and relationships with their actual
customers and admirers through various Ducati clubs. The idea
of customer as influencer is an important piece of the marketing
puzzle and Ducati is going in the right direction to achieve this.
They also re-examined their messaging and took a much closer
look at their audiences and the benefits to that target and
repositioned the brand. The results of having a more direct
conversation with your customer and engaging them through
marketing efforts always results in an acceleration.

CUSTOMER NEEDS

Definition 1: It is easy to make assumptions about what customers

want and need. Interviewing customers provides the team with up-to-
date information on customer priorities, clarifies likes and dislikes, and
identifies emerging opportunities.
Definition 2: Problems that customers intend to solve with the
purchase of a good or service. See also customer expectations and
customer requirements.

Definition 3: Knowing and understanding customer needs is at the

centre of every successful business, whether it sells directly to
individuals or other businesses. Once you have this knowledge, you
can use it to persuade potential and existing customers that buying
from you is in their best interests.

EXAMPLES
 • Farming corn ,to do this job, the farmer must select the seed,
control the insects, control the weeds, prepare the soil, plant the
seed, grow the corn, protect the crop, harvest the crop, dry the
harvest, market the crop and assess the yield.

• Hotels have to provide their customer needs .The customer

needs are to secure the right product at the right price at the
right time. A customer who has a need for a product or service
with a specific budget and needs to have the fulfilment within a
time frame that company has to meet.

CUSTOMER RELATION

Definition 1: Those aspects of a business strategy which relate to

techniques and methods for attracting and retaining customers.

Definition 2: Managing the customer relationship is a definition of how

the company should attend to the customer after the initial sale.
Clients are notorious for demanding the best of breed service and
product and if the supplier does not deliver, the customer will find their
competitor in an instant.
Definition 3: Informing customers of what’s going on at your place is a
key to build healthy customer relationships. Managers need to assess
customer relationships as it helps in creating a loyal customer base.
After all, customers are the ones who provide revenues to act as the
financial fuel for the company.

EXAMPLES
• Pizza hut has a customer relationship with their customer
through their feedback forms which have various options about
the service also give a space for customers idea of improvement.

• Linkedin to identify contacts in target companies. This has

resulted in several meetings but, as our sales process takes
quite a bit of time, we're still in the relationship building stage
with customers.
CUSTOMER RELATIONSHIP MANAGEMENT

Definition 1: It is a widely-implemented strategy for managing a

company’s interactions with customers, clients and sales prospects. It
involves using technology to organize, automate, and synchronize
business processes—principally sales activities, but also those for
marketing, customer service, and technical support. The overall goals
are to find, attract, and win new clients, nurture and retain those the
company already has, entice former clients back into the fold, and
reduce the costs of marketing and client service .It also defines a
company-wide business strategy including customer-interface
departments as well as other departments.

Definition 2: Is an information industry term for methodologies,

software, and usually Internet capabilities that help an
enterprise manage customer relationships in an organized way.

Definition 3: The methods and concepts a company uses to manage

their relationships with their customers. For example a company might
use a database to keep track of customers – knowing the most about
your customers as possible is the key.

Definition 4: A customer centric business strategy that proactively

builds a bias towards a company or organization with its customers,
employees, and channels. The result is increased retention and
satisfaction ultimately contributing to a perception of enhanced value
and increased profitability.

EXAMPLES
• Using customer relationship management (CRM) tools, Termite
Extermination Inc. was able to develop and implement a
marketing plan that increased sales dramatically.

• American Airlines is one of the best .They offer perks that show
they are treating different customers differently. But the
industry’s customer differentiation is still designed around their
product and their services, not around individual customer
needs. Customers don’t want to be treated equally. They want to
 be treated individually .They manage their relation with
customers in different way which makes them stand out.

CUSTOMER RELATIONSHIP MARKETING

Definition 1: It recognizes the long term value of customer

relationships and extends communication beyond intrusive advertising
and sales promotional messages .With the growth of the internet and
mobile platforms ,Customer Relationship Marketing has continued to
evolve and move forward as technology opens more collaborative and
social communication channels. This includes tools for managing
relationships with customers those go beyond simple demographic and
customer service data.
Definition 2: Customer relationship marketing recognizes that it is not
enough to attract buyers .The CRM goal is to covert buyers into
loyalists and loyalists into enthusiasts. It focuses their resources on
moving their customer up the loyalty .This is new view of marketing is
not merely a better way to practice marketing.
Definition 3: Promotional and selling activities aimed at developing and
managing trusting and long-term relationships with larger customers.
Customer profile, buying patterns, and history of contacts is
maintained in a sales database, and a service representative (also
called account executive) is assigned to one or more major customers
to fulfil their needs and maintain the relationship.

Definition 4: Relationship Marketing is a marketing strategy whose

objective is to establish and maintain a profitable, long-term
relationship with a customer, which goes beyond the initial contact.
Definition 5: Relationship marketing is a form of marketing that
evolved from direct response marketing, it places emphasis on
building longer-term relationships with customers rather than on
individual transactions. Relationship marketing involves an
understanding of customers' needs and wants through their lifecycle
and providing a range of products or services accordingly.

EXAMPLES
 • Sending new customers a "Welcome Kit," which might have
an incentive to make a second purchase. If 60 days pass and
the customer has not made a second purchase, you would follow
up with an e-mailed discount. You are using customer behavior
over time (the customer Life Cycle) to trigger the marketing
approach.
• Star bucks has blogs and are capable of establishing trusting
customer relationships that meet the concept of one-to-one
marketing and are a vehicle to reach niche markets According to
Gardner a blog has the capacity to establish a two way dialogue
with the participants. “customer relationship blogs” because it
allows companies to interact and connect with customers in an
immediate, convenient and personal way.

CUSTOMER SATISFACTION MODEL

Definition : The Kano model(customer satisfaction model) is a theory
of product development and customer satisfaction developed in the
80s by Professor Noriaki Kano which classifies customer preferences
into five categories:
• Attractive : These attributes provide satisfaction when achieved
fully, but do not cause dissatisfaction when not fulfilled. These
are attributes that are not normally expected, For example, a
thermometer on a package of milk showing the temperature of
the milk. Since these types of attributes of quality unexpectedly
delight customers, they are often unspoken.
• One-Dimensional : These attributes result in satisfaction when
fulfilled and dissatisfaction when not fulfilled. These are
attributes that are spoken of and ones which companies
compete for. An example of this would be a milk package that is
said to have ten percent more milk for the same price will result
in customer satisfaction, but if it only contains six percent then
the customer will feel misled and it will lead to dissatisfaction.
• Must-Be : These attributes are taken for granted when fulfilled
but result in dissatisfaction when not fulfilled. An example of this
would be package of milk that leaks. Customers are dissatisfied
 when the package leaks, but when it does not leak the result is
not increased customer satisfaction. Since customers expect
these attributes and view them as basic, then it is unlikely that
they are going to tell the company about them when asked
about quality attributes.
• Indifferent : These attributes refer to aspects that are neither
good nor bad, and they do not result in either customer
satisfaction or customer dissatisfaction.
• Reverse : These attributes refer to a high degree of achievement
resulting in dissatisfaction and to the fact that not all customers
are alike. For example, some customers prefer high-tech
products, while others prefer the basic model of a product and
will be dissatisfied if a product has too many extra features.
EXAMPLES
• A survey might be used by a retail store chain wanting to know
how customers feel about their stores. It is designed to identify
areas needing improvement.
• Product registration form provides an excellent opportunity to do
market research. This survey attempts to find out how various
factors affect a customer's buying decision. Learn which
attributes are perceived to be associated with the product(s). It
will explain the satisfaction of the customer.

CUSTOMER SATISFACTION RESEARCH

Definition 1: Customer satisfaction research is that area of
marketing research which focuses on customers' perceptions with their
shopping or purchase experience. Many firms are interested in
understanding what their customers thought about their shopping or
purchase experience, because finding new customers is generally
more costly and difficult that servicing existing or repeat customers.
Many people are familiar with "business to customer" (B2C) or retail-
level research, but there are also many "business to business" (B2B) or
wholesale-level projects commissioned as well.
Definition 2: Understanding your customers is a critical element of
providing customer service. That means communication and data
gathering. Find information and methods about how to gather and
make sense of customer information - satisfaction levels, use of focus
groups, surveys.
EXAMPLES
• Many companies have easy-to-use form designed to aid in the
quick resolution of customer service problems. It will help
prevent customer problems from falling through the cracks,
provide for an orderly hand-off to someone who can address the
matter, and help you establish fool-proof procedures that ensure
prompt action is taken when a customer is unhappy with the
products or services received. You can quickly customize the
form to reflect the work flow of your company.
• Mineful is a web based software for creating online surveys,
building business web forms, and easily analyzing and reporting
data. Mineful's market research software and online
questionnaire tool helps you::: Create online surveys using an
intuitive wizard interface, Send invitations and track respondents
using uploadable email lists, View your data and create reports
and graphs online.

CUSTOMER SERVICE

Definition 1: Customer service is the provision of service to customers

before, during and after a purchase.

Definition 2: "Customer service is about treating others as you would

like to be treated yourself".

Definition 3: A wide variety of activities intended to ensure that

customers receive the goods and services they require to satisfy their
needs or wants in the most effective and efficient manner possible.

Definition 4: Customer Service is the commitment to providing value

added services to external and internal customers, including attitude
knowledge, technical support and quality of service in a timely
manner"

EXAMPLES
 • Bank of America has a 24 hour customer service. Customer can
send a secure email to them at anytime day or night. They
provide their customer the required support.

• tMobile has a customer service which is through their own phone

a message can be sent directly to their customer service centre.

CUSTOMER SURPLUS

Definition 1: A measure of the value of a particular deal to the

customer. Surplus is the difference between the fair price and the price
actually paid.. If the price the customer pays is less than a fair price,
the surplus is positive; if more than the fair price, negative; if equal to
fair price, zero.
Definition 2: It is the amount that consumers benefit by being able to
purchase a product for a price that is less than the most that they
would be willing to pay.
Definition 3: Consumer surplus is the difference between the
maximum price a consumer is willing to pay and the actual price they
do pay. If a consumer would be willing to pay more than the current
asking price, then they are getting more benefit from the purchased
product than they spent to buy it.

EXAMPLES

• If a bid to buy the yacht, I might decide that I was willing to pay
a maximum of £175,000 (I can but dream!). If the current
highest bid is only £128,000, then the bidding site will show me
as the new highest bidder at £128,001. If another bidder offers
£140,000 then the bidder will be informed that this is not the
highest bid but the new bid price will now be £140,000. Only if
someone bids more than £175,000 will I lose the auction, but I
might end up paying the full £175,000 for the item concerned.

CUSTOMER VALUE ANALYSIS

Definition 1: Customer Value Analysis is a customer-survey

methodology that helps customer increase market share. It works best
in the business-to-business and consumer-durables markets. In these
markets, customers make purchase decisions based on their
perceptions of value, which are formed by their perceptions of quality
and price. In the aggregate, customers flow from companies that
provide inferior value to those that provide superior value.

Definition 2: It shows how customers select between competing

suppliers. The methodology examines the relationship between the
perceived benefits customers identify with a product or service
offering and their willingness to pay for those benefits.

Definition 3: An organization's rating of the value it provides to its

customers relative to that provided by its competitors.
Definition 4: The path to improved customer value starts with data.
Customer value analysis develops a quantitative picture of the
markets in which you compete.

EXAMPLES
• The Lucent Technologies business units commission surveys to
measure the level of satisfaction of their customers and the level
of satisfaction of competitor's customers. Survey results are
used to manage the business at a fundamental level.

CUSTOMER VALUE MANAGEMENT

Definition 1: Customer value management is managing each customer

relationship with the goal of achieving maximum lifetime profit from
the entire customer base. Customer value management enables
companies to take full advantage of the economics of loyalty by
increasing retention, reducing risk, and amortizing acquisition costs
over a longer and more profitable period of engagement.

Definition 2: CVM shifts the focus of the enterprise from managing

products or marketing campaigns to managing the profitability of each
individual customer over the entire life of the relationship. While CVM
can and does lead to better product offerings and more targeted
campaigns, a customer value manager will ask different questions
than a traditional marketing manager. Art and science of measuring,
analyzing, and managing value. A product's relative value is the
customer-perceived performance-for-price relative to rival brands.

Definition 3: It is central to gaining the maximum lifetime value of

managing customers by turning your data into Intelligent Information .
CVM solutions enable you to best respond to your customer needs in a
timely manner.

EXAMPLES
• Company like colgate, they always mention the important parts
of the product in their advertising such as it makes teeths
 healthy,helps improve stain and much more. They always
include it in their marketing.

• Ziploc has mentioned on their packaging fresh food always,

freez.they promote their product through advertising the
essentials of the product.

DATA MINING

• Extracting of useful information about individuals, trends, and

segments from the mass of data. (Philip Kotler- Marketing
Management)
• Internet-based marketing strategies generate extremely large
data sets from customer interactions. Purchase histories,
financial records, customer service records, and web site usage
are just some of the data that reside in customer databases. In
order to transform this mountain of diverse data into
operationally useful information, marketers are increasingly
using data mining procedures. Data mining is the computer-
based exploration and analysis of large quantities of data in
order to discover meaningful patterns and rules for the purpose
of improving marketing, sales, and customer support operations.
The combination of data mining procedures with data
warehousing enables the MDSS to move beyond just support for
the operational processes in the marketing organization and to
focus on actual customer behaviour. Data mining and data
warehousing provide the means and the infrastructure for
extracting strategic opportunity from knowledge of the
customer.

DATA WAREHOUSING

• A collection of current data captured, organized, and stored in a

company’s contact center. (Philip Kotler- Marketing
Management)
• IBM defines a data warehouse as a place that stores enterprise
data designed to facilitate management decisions. In essence, a
data warehouse provides the basis for an analytical system
 where periodic data points are collected and stored at specified
times for future analysis.
Data warehousing enables marketers to capture, organize, and
store potentially useful data about customers and markets for
decision-making purposes.
Every record of a transaction or interaction with a customer,
supplier, channel member, or sales person is an opportunity to
create knowledge. Firms collect data from these day-today
business operations. In order for this data to be useful, it is often
organized and stored in a data warehouse. Simply put, a
marketing data warehouse is a repository for data that has been
collected from internal and external data sources. Each customer
generates a stream of transaction records over time. Data
sources may include scanner data, billing records, application,
registration forms, warranty forms, call reports, customer service
inquiries, and web site data.
Data warehousing enables the firm to organize and store this
data for analysis purposes. By careful analysis of this and other
data, firms can design more effective and efficient ways to serve
their customers. Data warehouses exist to support the decision-
making process by providing ready access to market and
customer data.
Example: PIZZA HUT
Pizza Hut claims to have the largest fast-food customer data
warehouse in the world, with 40 million U.S. households—or
between 40 and 50 percent of the U.S. market. The millions of
customer records are gleaned from point-of-sale transactions at its
restaurants. Pizza Hut can slice and dice data by favourite toppings,
date of last order, or by whether you order a salad with your
pepperoni pizza. Using its Teradata Warehouse Miner, Pizza Hut has
not only been able to purge expensive duplicates from its direct-
mail campaigns, but can also target its marketing to find the best
coupon offers for each household and predict the success of
campaigns.

DECEPTIVE ADVERTISING

• Any advertising intended to mislead the consumers. Deceptive

Advertising is illegal. Advertising is considered as such when it
makes spurious claims about a product, fails to fully disclose
 information about it, or otherwise creates false impressions.
Advertising agencies, celebrity endorsers and retailers may all
be accused of engaging in deceptive advertising. For example
bait and switch advertising by the retailers is considered as
deceptive advertising. This is where the retailer advertises a low
priced item (which may not be available or in extremely low
supply) to increase his store traffic and the consumers buy its
high priced substitute. The laws prohibiting deceptive
advertising are enforced by the Federal Trade Commission. (The
Marketing Glossary: Key Terms, Concepts and Applications By
Mark N. Clemente)

DECISION MAKING:

• Decision making is often seen as the centre of what managers

do, something that engages most of a managers time. It is one
of the areas that information systems have sought most of all to
affect (with mixed success). Decision making can be divided into
3 types: strategic, management control and operations control.
• Strategic decision making: This level of decision making is
concerned with deciding on the objectives, resources and
policies of the organisation. A major problem at this level of
decision making is predicting the future of the organisation and
its environment, and matching the characteristics of the
organisation to the environment. This process generally involves
a small group of high-level managers who deal with very
complex, non-routine problems. For example, some years ago, a
medium-sized food manufacturer in an East African country
faced strategic decisions concerning its range of pasta products.
These products constituted a sizeable proportion of the
company's sales turnover. However, the company was suffering
recurrent problems with the poor quality of durum wheat it was
able to obtain resulting in a finished product that was too brittle.
Moreover, unit costs were shooting up due to increasingly
frequent breakdowns in the ageing equipment used in pasta
production. The company faced the decision whether to make a
very large investment in new machinery or to accept the offer of
another manufacturer of pasta products, in a neighbouring
country, that it should supply the various pasta products and the
local company put its own brand name on the packs. The
 decision is strategic since the decision has implications for the
resource base of the enterprise, i.e. its capital equipment, its
work force, its technological base etc. The implications of
strategic decisions extend over many years, often as much as
ten to fifteen years.
• Management control decisions: Such decisions are
concerned with how efficiently and effectively resources are
utilised and how well operational units are performing.
Management control involves close interaction with those who
are carrying out the tasks of the organisation; it takes place
within the context of broad policies and objectives set out by
strategic planners. An example might be where a transporter of
agricultural products observes that his/her profits are declining
due to a decline in the capacity utilisation of his/her two trucks.
The manager (in this case the owner) has to decide between
several alternative courses of action, including: selling of trucks,
increasing promotional activity in an attempt to sell the spare
carrying capacity, increasing unit carrying charges to cover the
deficit, or seeking to switch to carrying products or produce with
a higher unit value where the returns to transport costs may be
correspondingly higher. Management control decisions are more
tactical than strategic.
• Operational control decisions: These involve making
decisions about carrying out the “specific tasks set forth by
strategic planners and management. Determining which units or
individuals in the organisation will carry out the task,
establishing criteria of completion and resource utilisation,
evaluating outputs - all of these tasks involve decisions about
operational control. The focus here is on how the enterprises
should respond to day-to-day changes in the business
environment. In particular, this type of decision making focuses
on adaptation of the marketing mix, e.g. how should the firm
respond to an increase in the size of a competitor's sales force?
Should the product line be extended? Should distributors who
sell below a given sales volume be serviced through wholesalers
rather than directly, and so on.
• Within each of these levels, decision making can be classified as
either structured or unstructured. Unstructured decisions are
those in which the decision maker must provide insights into the
problem definition. They are novel, important, and non-routine,
 and there is no well-understood procedure for making them. In
contrast, structured decisions are repetitive, routine, and involve
a definite procedure for handling them so that they do not have
to be treated each time as if they were new. Structured and
unstructured problem solving occurs at all levels of
management. In the past, most of the success in most
information systems came in dealing with structured,
operational, and management control decisions. However, in
more recent times, exciting applications are occurring in the
management and strategic planning areas, where problems are
either semi-structured or are totally unstructured.
• Making decisions is not a single event but a series of activities
taking place over time. Suppose, for example, that the
Operations Manager for the National Milling Corporation is faced
with a decision as to whether to establish buying points in rural
locations for the grain crop. It soon becomes apparent that the
decisions are likely to be made over a period of time, have
several influences, use many sources of information and have to
go through several stages. It is worth considering the question of
how, if at all, information systems could assist in making such a
decision. To arrive at some answer, it is helpful to break down
decision making into its component parts.
• The literature has described 4 stages in decision making:
intelligence, design, choice and implementation. That is,
problems have to be perceived and understood; once perceived
solutions must be designed; once solutions are designed,
choices have to be made about a particular solution; finally, the
solution has to be implemented.
• Intelligence involves identifying the problems in the
organisation: why and where they occur with what effects. This
broad set of information gathering activities is required to inform
managers how well the organisation is performing and where
problems exist. Management information systems that deliver a
wide variety of detailed information can be useful, especially if
they are designed to report exceptions. For instance, consider a
commercial organisation marketing a large number of different
products and product variations. Management will want to know,
at frequent intervals, whether sales targets are being achieved.
Ideally, the information system will report only those
 products/product variations which are performing substantially
above or below target.
• Designing many possible solutions to the problems is the
second phase of decision making. This phase may require more
intelligence to decide if a particular solution is appropriate. Here,
more carefully specified and directed information activities and
capabilities focused on specific designs are required.
• Choosing among alternative solutions is the third step in the
decision making process. Here a manager needs an information
system which can estimate the costs, opportunities and
consequences of each alternative problem solution. The
information system required at this stage is likely to be fairly
complex, possibly also fairly large, because of the detailed
analytic models required to calculate the outcomes of the
various alternatives. Of course, human beings are used to
making such calculations for themselves, but without the aid of a
formal information system, we rely upon generalisation and/or
intuition.
• Implementing is the final stage in the decision making process.
Here, managers can install a reporting system that delivers
routine reports on the progress of a specific solution, some of
the difficulties that arise, resource constraints, and possible
remedial actions. The following table illustrates the stages in
decision making and the general type of information required at
each stage.
Stages in the decision making process
In practice, the stages of decision making do not necessarily
follow a linear path from intelligence to design, choice and
implementation. Consider again the problem of balancing the
costs and benefits of establishing local buying points for the
National Milling Corporation. At any point in the decision making
process it may be necessary to loop back to a previous stage.
For example, one may have reached stage 3 and all but decided
that having considered the alternatives of setting up no local
buying points, local buying points in all regions, districts or
villages, the government decides to increase the amounts held
in the strategic grain reserve. This could cause the parastatal to
return to stage 2 and reassess the alternatives. Another scenario
would be that having implemented a decision one quickly
 receives feedback indicating that it is not proving effective.
Again, the decision maker may have to repeat the design and/or
choice stage(s).

DECISION SUPPORT SYSTEMS (DSS)

• A computer based system designed to assist in management

decision making. Decision Support Systems are comprised of
specially developed software and hardware. Management inputs
data (qualitative and/or quantitative) into the system. The
system then outputs information describing the implications of
specific decisions. (Such Systems may also be designed to
recommend specific decisions). Decision Support Systems
enable management to conduct “what-if” analysis. For example
the management might ask: “If we increase the number of
distribution outlets in a given area, what will be the impact on
product sales in that area?” In marketing, DSS are often used in
sales forecasting and in determining media schedules. (The
Marketing Glossary: Key Terms, Concepts and Applications By
Mark N. Clemente).

DEMAND ANALYSIS

• Study of sales generated by a good or service to determine the

reasons for its success or failure, and how its sales performance
can be improved. And the market research that is done to
analyse the demand in the market.
• LG franchisees must make a sales register to analyse the
consumers’ responses to their product.
• Manufacturing companies regularly conduct market surveys and
collect sales data to simulate demand and production
requirements.

DEMAND FORECASTING

• Demand forecasting is the activity of estimating the quantity of a

product or service that consumers will purchase. Demand
forecasting involves techniques including both informal methods,
 such as educated guesses, and quantitative methods, such as
the use of historical sales data or current data from test markets.
• Demand forecasting may be used in making pricing decisions, in
assessing future capacity requirements, or in making decisions
on whether to enter a new market.
• Examples
Maruti Suzuki did demand forecasting for deciding the number of
cars that are required to be produced
Coca Cola decides the production output by the help of demand
forecasting
Mahindra and Mahindra did a market research to launch tractors
in different countries i.e. Vietnam and Africa.

DEMOGRAPHIC SEGMENTATION

• Demographic segmentation consists of dividing the market

into groups based on variables such as age, gender family size,
income, occupation, education, religion, race and nationality. As
you might expect, demographic segmentation variables are
amongst the most popular bases for segmenting customer
groups. This is partly because customer wants are closely linked
to variables such as income and age. Also, for practical reasons,
there is often much more data available to help with the
demographic segmentation process. The main demographic
segmentation variables are summarised below:

Age
• Consumer needs and wants change with age although they may
still wish to consumer the same types of product. So Marketers
design, package and promote products differently to meet the
wants of different age groups. Good examples include the
marketing of toothpaste (contrast the branding of toothpaste for
children and adults) and toys (with many age-based segments).

Life-cycle stage
• A consumer stage in the life-cycle is an important variable -
particularly in markets such as leisure and tourism. For example,
contrast the product and promotional approach of Club 18-30
holidays with the slightly more refined and sedate approach
adopted by Saga Holidays.
 Gender
• Gender segmentation is widely used in consumer marketing. The
best examples include clothing, hairdressing, magazines and
toiletries and cosmetics.

Income
• Another popular basis for segmentation. Many companies target
affluent consumers with luxury goods and convenience services.
Good examples include Coutts bank; Moet & Chandon
champagne and Elegant Resorts - an up-market travel company.
By contrast, many companies focus on marketing products that
appeal directly to consumers with relatively low incomes.
Examples include Aldi (a discount food retailer), Airtours
holidays, and discount clothing retailers such as TK Maxx.

Social class
• Many Marketers believe that a consumers "perceived" social
class influences their preferences for cars, clothes, home
furnishings, leisure activities and other products & services.
There is a clear link here with income-based segmentation.

Lifestyle
• Marketers are increasingly interested in the effect of consumer
"lifestyles" on demand. Unfortunately, there are many different
lifestyle categorisation systems, many of them designed by
advertising and marketing agencies as a way of winning new
marketing clients and campaigns!

DETERMINISTIC SYSTEM

• A model where specified conditions are always associated with

precisely specified consequences i.e. a model based on
variables, the values of which may be stated with certainty and
are sufficient to describe the system behaviour.

DIFFERENTIAL WORTH

• The difference in the worth (economic value) of benefits

delivered by one product versus a reference product. It is
equivalent to the monetary difference between the two products’
 positions on the fair-value line. The reference product can be the
average product (in the category or consideration set) or a
specific competing product.

DIFFERENTIATED MARKETING

• When a firm produces numerous products and promotes them

with a different marketing mix designed to satisfy smaller
segments. Differentiated Marketing tends to raise costs and
firms may be forced to practice differentiated marketing to
remain competitive.
• A strategic consideration where a company chooses to operate
in more than one market segment and develops specific
products and promotional strategies for each. An example of
differentiated marketing is a company that produces coffee and
markets various types: regular, decaffeinated, instant etc.
Differentiated marketing creates more toatal sales than
undifferentiated marketing. However, the costs of engaging in a
differentiated are high. This is because the company must
modify its product and incur increased costs for specialized
administrative, inventory and promotional activities.
• An example of this would be airline companies offering first,
business (segment 1) or economy class tickets (segment 2) ,
with separate marketing programmed to attract the different
groups.
• Example: Mahindra tractors have different products for different
segment of population. Like Mahindra Ultra, Turbo, and
Shaktiman.
• Nokia has various models catering to segments of the
population. Nokia 1110, 5310, Eseries.etc

DIFFUSED PREFERENCES

• This refers to pattern of consumer preferences in terms of

various attributes of a product or service. One of
the preferences are known as diffused preferences where
consumer preferences are scattered indicating that consumers
vary greatly in terms of their preferences. In this type of product
market the company, which enters first, is likely to position its
 product in the centre of the product preference map to appeal to
the most people. If several brands are in the market, they are
likely to position throughout the space and try to show real
differences to match consumer-preference differences.

DIGITAL MARKETING

• Digital Marketing is the promoting of brands using all forms of

digital advertising channels to reach consumers. This now
includes Television, Radio, Internet, mobile and any other form
of digital media. Whilst digital marketing does include many of
the techniques and practices contained within the category of
Internet Marketing, it extends beyond this by including other
channels with which to reach people that do not require the use
of The Internet. As a result of this non-reliance on the Internet,
the field of digital marketing includes a whole host of elements
such as mobile phones, sms/mms, display / banner ads and
digital outdoor.

Examples:
• Advertisements on television.
• Digital displays in the malls for advertising.

DIMENSIONS OF CUSTOMER-PERCEIVED VALUE

• CVI’s customer-value tree identifies six generic dimensions of

customer-perceived value:

a) Product – relating to the good or core service being sold,

b) Customer service – customer care activities that support the
delivery of the product or core service,
c) Relationship – customized connections and knowledge related to
individual customers and key accounts,
d) Brand affinity – KBFs relating to the authority the brand holds
with customers, how well customers identify with the brand and its
promise, and peer-group approval associated with using the brand,
e) Price – the transactions price that the customer pays for the
product; and
f) Other costs – that the customer incurs in addition to the
transactions price not necessarily paid to the supplier.
 Although the key buying factors will be different for different market
categories, they can always be classified into these dimensions.

DIRECT MARKETING

• The use of consumer- direct channels to reach and deliver goods

and services to customers without using marketing middlemen.
(Philip Kotler- Marketing Management)
• Sending a promotional message directly to consumers, rather
than via a mass medium. Includes methods such as Direct Mail
and Telemarketing. Example: As soon as Beverly got her
realtor's license she sent postcards to all the addresses listed in
her zip code. She hoped purchasing a mailing list for consumer
direct marketing in her home town would bring her new
prospective home buyers faster than word-of-mouth alone.
• Direct marketing involves the business attempting to locate,
contact, offer, and make incentive-based information available to
consumers.
• Direct marketing is just what it sounds like - directly reaching a
market (customers and potential customers) on a personal
(phone calls, private mailings) basis, or mass-media basis
(infomercials, magazine ads, etc.).
• Types of direct marketing include: distributing flyers; door-to-
door solicitations; curbside stands; FAX broadcasting; television
marketing (i.e., infomercials); coupon ads in print media; and
voice mail marketing.

DISPOSABLE INCOME

• Disposable income is total personal income minus personal

current taxes. In national accounts definitions, personal income,
minus personal current taxes equals disposable personal
income. Subtracting personal outlays (which includes the major
category of personal (or, private) consumption expenditure)
yields personal (or, private) savings.

DISPLAY ADVERTISING

• Print advertising that appears in the editorial section of a

publication and which usually features creative use of colours
 and illustrations to maximise communication effectiveness.
Display ads vary in their design. Large display ads attract
reader’s attention, as does use of colour. Display advertising
contracts classified advertising, which are print ads categorized
under separate headings i.e. employment, real estate, business
opportunities etc.

DISTRIBUTION CHANNEL

• Distribution (or "Place") is the fourth traditional element of the

marketing mix. The other three are Product, Price and
Promotion.
The Nature of Distribution Channels
Most businesses use third parties or intermediaries to bring
their products to market. They try to forge a "distribution
channel" which can be defined as "all the organisations
through which a product must pass between its point of
production and consumption". Why does a business give the
job of selling its products to intermediaries? After all, using
intermediaries means giving up some control over how products
are sold and who they are sold to.
The answer lies in efficiency of distribution costs. Intermediaries
are specialists in selling. They have the contacts, experience and
scale of operation which means that greater sales can be
achieved than if the producing business tried run a sales
operation itself.
Functions of a Distribution Channel
Information Gathering and distributing market research
and intelligence - important for marketing
planning
Promotion Developing and spreading communications
about offers
Contact Finding and communicating with prospective
buyers
Matching Adjusting the offer to fit a buyer's needs,
including grading, assembling and packaging
Negotiation Reaching agreement on price and other terms
of the offer
Physical Transporting and storing goods
distribution
Financing Acquiring and using funds to cover the costs of
the distribution channel
Risk taking Assuming some commercial risks by operating
the channel (e.g. holding stock)
The main function of a distribution channel is to provide a link
between production and consumption. Organisations that form
any particular distribution channel perform many key functions:

All of the above functions need to be undertaken in any market. The

question is - who performs them and how many levels there need to
be in the distribution channel in order to make it cost effective.
Numbers of Distribution Channel Levels
Each layer of marketing intermediaries that performs some work in
bringing the product to its final buyer is a "channel level". The
figure below shows some examples of channel levels for consumer
marketing channels:
• In the figure above, Channel 1 is called a "direct-marketing"
channel, since it has no intermediary levels. In this case the
manufacturer sells directly to customers. An example of a direct
marketing channel would be a factory outlet store. Many holiday
companies also market direct to consumers, bypassing a
traditional retail intermediary - the travel agent.
• The remaining channels are "indirect-marketing channels".
• Channel 2 contains one intermediary. In consumer markets, this
is typically a retailer. The consumer electrical goods market in
the UK is typical of this arrangement whereby producers such as
Sony, Panasonic, Canon etc. sell their goods directly to large
retailers such as Comet, Dixons and Currys which then sell the
goods to the final consumers.
• Channel 3 contains two intermediary levels - a wholesaler and a
retailer. A wholesaler typically buys and stores large quantities
of several producers goods and then breaks into the bulk
deliveries to supply retailers with smaller quantities. For small
retailers with limited order quantities, the use of wholesalers
makes economic sense. This arrangement tends to work best
where the retail channel is fragmented - i.e. not dominated by a
small number of large, powerful retailers who have an incentive
to cut out the wholesaler. A good example of this channel
arrangement in the UK is the distribution of drugs.
DISTRIBUTION

• The following table describes the factors that influence the

choice of distribution channel by a business:
• Market factors: An important market factor is "buyer behaviour";
how do buyer's want to purchase the product? Do they prefer to
buy from retailers, locally, via mail order or perhaps over the
Internet? Another important factor is buyer needs for product
information, installation and servicing. Which channels are best
served to provide the customer with the information they need
before buying? Does the product need specific technical
assistance either to install or service a product? Intermediaries
are often best placed to provide servicing rather than the
original producer - for example in the case of motor cars.
The willingness of channel intermediaries to market product is
also a factor. Retailers in particular invest heavily in properties,
shop fitting etc. They may decide not to support a particular
product if it requires too much investment (e.g. training, display
equipment, warehousing).
Another important factor is intermediary cost. Intermediaries
typically charge a "mark-up" or "commission" for participating in
the channel. This might be deemed unacceptably high for the
ultimate producer business.
• Producer factors: A key question is whether the producer has
the resources to perform the functions of the channel? For
example a producer may not have the resources to recruit, train
and equip a sales team. If so, the only option may be to use
agents and/or other distributors.
Producers may also feel that they do not possess the customer-
based skills to distribute their products. Many channel
intermediaries focus heavily on the customer interface as a way
of creating competitive advantage and cementing the
relationship with their supplying producers.
Another factor is the extent to which producers want to maintain
control over how, to whom and at what price a product is sold. If
a manufacturer sells via a retailer, they effective lose control
over the final consumer price, since the retailer sets the price
and any relevant discounts or promotional offers. Similarly, there
is no guarantee for a producer that their product/(s) are actually
 been stocked by the retailer. Direct distribution gives a producer
more control over these issues.
• Product factors: Large complex products are often supplied
direct to customers (e.g. complex medical equipment sold to
hospitals). By contrast perishable products (such as frozen food,
meat, bread) require relatively short distribution channels -
ideally suited to using intermediaries such as retailers.
• Distribution Intensity: There are three broad options - intensive,
selective and exclusive distribution:
Intensive distribution aims to provide saturation coverage of
the market by using all available outlets. For many products,
total sales are directly linked to the number of outlets used (e.g.
cigarettes, beer). Intensive distribution is usually required where
customers have a range of acceptable brands to choose from. In
other words, if one brand is not available, a customer will simply
choose another.
Selective distribution involves a producer using a limited
number of outlets in a geographical area to sell products. An
advantage of this approach is that the producer can choose the
most appropriate or best-performing outlets and focus effort
(e.g. training) on them. Selective distribution works best when
consumers are prepared to "shop around" - in other words - they
have a preference for a particular brand or price and will search
out the outlets that supply.
Exclusive distribution is an extreme form of selective
distribution in which only one wholesaler, retailer or distributor is
used in a specific geographical area.

DOUBTFUL POSITIONING

• Claiming a benefit that customers will doubt that the brand can
actually deliver. For example, a mutual fund offers 100% returns
on investment. Another example will be the claims for various
products in QVC channel: Oxyrich - which claims to clean better
than all the leading brands, Ashvini hair oil - which promises to
stop hair loss, Weight loss pills etc.
• Sometimes companies try and create brand among consumers
even before positioning the brand clearly in the market. This is
called as doubtful positioning. For instance, many of the dot com
 companies spent heavily on television advertising without
themselves being clear of what they were selling.

DRIP MARKETING

• Drip Marketing is a communication strategy that sends, or

"drips," a pre-written set of messages to customers or prospects
over time. These messages often take the form of E-mail
marketing, although other media can also be used. Drip
marketing is unique from other database marketing in two ways:
(1) the timing of the messages follows a pre-determined course;
(2) the messages are dripped in a series applicable to a specific
behavior or status of the recipient.
Drip Marketing Mediums
• E-mail: The most commonly used form of drip marketing is E-
mail marketing, due to the low cost associated with sending
multiple messages over time. Email drip marketing is often used
in conjunction with a Form (web) in a method called an Auto
responder. In this method, a lead completes the form on a
company's website and is then enrolled in a drip marketing
campaign with messaging appropriate to the form's context.
• Direct Mail: Although more costly, direct mail software has been
developed that enables drip marketing techniques using
standard postal mail. This technology relies on digital printing,
where low-volume print runs are cost justifiable, and the variable
data can be merged to personalize each drip message.
• Social Media: The principles of Drip Marketing have been applied
in many social media marketing tools to schedule a series of
updates. One popular tool, HootSuite, allows users to time
messages and disseminate via Twitter, Facebook, LinkedIn, and
several other social media sites simultaneously.
Examples:
1) Subscribers of newsletter receive them at regular intervals.
2) Reminder of your membership of a website to be over soon.
DROP ERROR

• It occurs when a company dismisses an idea which turns out to be

good and successful later. (Marketing Management-Kotler, Kelly,
Koshi, Jha)

• A decision to drop a PRODUCT from the line, or to discontinue

development of a new product which subsequently proves to have
been a premature decision, in light of successes achieved by
competitors with similar developments(The Westburn Dictionary of
Marketing edited by Michael J Baker)

• A mistake made by a company in deciding to abandon a new

product idea that, in hindsight, might have been successful if
developed(International Marketing-Cateora Graham)

➢ The pilot for “Friends”, one of the longest running hit comedies
on TV was deemed as ‘not very entertaining or original’.

DUAL ADAPATION

• Adapting the product and the communication according to the local

market(Marketing Management-Kotler, Kelly, Koshi, Jha)

• It involves altering both the product and the communications.

• Dual adaption is a marketing strategy designed by Philip Kotler. It is

for companies which introduce their products in a new country. It
means that you adapt the product to the local market, but also
adaption for the commercial message. (Basic Marketing- Cannon)
• Using Dual Adaptation the company must adapt the product or
service as well as the marketing communication to the foreign
market(International Marketing-Joshi)

• It refers to the changes made to the product and to

communications strategy. It recognizes the socio-cultural
differences from country to country.To make this option profitable,
the foreign market or markets need to be of sufficient volume. It
calls for extensive research and development expenses and tooling
costs. (Fundamentals of Marketing- Stanton and Futrell)

➢ Unilever fabric softener- Comfort went through a number

of changes: a new logo and more modern packaging in
1992 and the first fully biodegradable formulation

➢ The classic example comes from National Cash Register,

which manufactured a crank-operated cash register and
promoted it to businesses in less-developed countries.

DUMPING

• The practice of selling a good in a foreign market at a price that is

lower than its domestic price, or below its cost. (International
Marketing-Joshi)

• The sale of an exported product at a price lower than that charged

for the same in the home market of the exporter. (Marketing-Lamb,
Hair, McDaniel)

• Practice of pricing a product in a foreign market below the going

price in the domestic market(Marketing-Churchill and Peter)
• The practice of charging either less than its costs or less than its
charges at home in order to enter or win a market. (Marketing-
Grewal and Levy )

• Selling products in the foreign markets at prices below the prices

charged for these goods in their home market,either to meet
foreign competition or to dispose of outmoded products
(Fundamentals of Marketing- Stanton and Futrell)

• A situation in which a company charges either less than its costs or

less than its charges in the home market, in order to enter or win a
market (Marketing Management-Kotler, Kelly, Koshi, Jha)

➢ In 2002, foreign countries started dumping low cost steel in

the US market, hence US had to impose steel tariff on
imported steel(Marketing-Grewal and Levy )

➢ Motorola had to eliminate defects to save costs, when foreign

competitors were dumping pagers in the Japanese market

➢ Canadian steelmaker Stelco successfully fought dumping of

steel products in Brazil, Finland, India, Indonesia, Thailand,
and Ukraine.

EARLY ADOPTERS

• The secondary category of buyers to try a product, they tend to buy

after they see that a product will work.( Marketing Management-
Kotler, Kelly, Koshi, Jha)
• Category of buyers that don’t like to take much risk, wait and
purchase the product after careful review. They enjoy novelty and
are often regarded as the opinion leaders for particular product
categories. (Marketing-Lamb, Hair, McDaniel)

• Opinion leaders who carefully search for new technologies that

might give them a dramatic competitive advantage. They are less
price sensitive and willing to adopt the product if given personalized
solutions and good service support (Marketing Management-Kotler,
Kelly, Koshi, Jha)

• People who chose new products and are viewed as “the people to
check with”.(Marketing-Pride,Fredell, Blotnicky,Grant)

• Opinion leaders and role models for others , with good social skills
and respect within larger social systems, who adopt to new social
systems before others do(Consumer Behaviour-Blackwell,Engel)

• An early adopter or lighthouse customer is an early customer of

a given company, product, or technology; in politics, fashion, art,
and other fields, this person would be referred to as
a trendsetter(Marketing-Grewal and Levy )

➢ Porsche, a successful brand for sports car enthusiasts saw

a decline in sports car sales after it entered the SUV mass
market, as the early adopters moved onto their new
products.

➢ Twitter has been embraced by an older demographic.

Twitter’s success has shattered a widely held belief that
young people lead the way to popularizing innovations

ECONOMIES OF SCALE
 • Economies of scale arise when the cost per unit falls as
output increases. Economies of scale are the main
advantage of increasing the scale of production and
becoming ‘big’.
Why are economies of scale important?
Firstly, because a large business can pass on lower costs to customers
through lower prices and its share of a market. This poses a
threat to smaller businesses that can be “undercut” by the competition
Secondly, a business could choose to maintain its current price for its
product and accept higher profit margins. For example, a furniture-
maker which could produce 1,000 cabinets at £250 each might expand
and be able to produce 2,000 cabinets at £200 each. The total
production cost will have risen to £400,000 from £250,000, but the
cost per unit has fallen from £250 to £200. Assuming the business sells
the cabinets for £350 each, the profit margin per cabinet rises from
£100 to £150.
• Economies of scale gives big companies access to a larger
market by allowing them to operate with greater
geographical reach
• the benefits associated with bulk purchasing.
• Economies of scale refers to the notion of increasing
efficiencies of the production of goods as the number
of goods being produced increases. (Basic Marketing-
Cannon)

• Cost advantages associated with large-scale production.

• reductions in the price per unit of marketing or
manufacturing a product as the quantity marketed or
produced increases

➢ The other courier companies use FedEx and charges

less than FedEx! They are not really competing with
FedEx; they are piggybacking on FedEx by being an
intermediary, getting a lot of business and buying
FedEx services for a very good rate, then reselling it.
They don’t have huge overhead, airplanes, or branding.
They simply Joint Venture with FedEx and use
 economies of scale. And everybody wins: FedEx, the
customer and the middleman (or Joint Venture broker)

➢ Wal-Mart WMT is perhaps the most salient example of a

company benefiting from economies of scale. As a
dominant player in retailing, the company's size
provides it with enormous efficiencies that it uses to
keep costs low. For example, its size allows Wal-Mart to
do its own purchasing more efficiently since it has
roughly 5,000 large stores worldwide. This gives the
company tremendous bargaining power with its
suppliers.

ENVIRONMENTAL THREAT

• A challenge posed by an unfavorable trend or development that

would lead to lower sales or profit(Marketing Management-Kotler,
Kelly, Koshi, Jha)

• Any factor in the market, external to the marketing organization,

that has the potential to negatively impact demand for the
marketer's product or service. An environmental threat might be
the entrance of a new competitor, the merger of two competitors,
the introduction of a new brand, the development of new
technology, legislative changes, or social and economic trends. The
marketer must be positioned through competitive intelligence and
other market trend research to respond quickly to environmental
threats. (Fundamentals of Marketing- Stanton and Futrell)

• Challenges posed by an unfortunate trend -lead to erosion of

company’s position(Basic Marketing- Cannon)

• An unfavorable condition in organization’s environment which

creates a risk or causes damage to the organization
 ➢ the tobacco industry has faced numerous environmental threats
due to increased social, medical, and legislative pressure against
smoking. The tobacco industry responded by deeply discounting
some brands and redirecting its resources to non-tobacco
products and to foreign markets where the environmental
threats are not as great.

➢ Microsoft.Net faces the following threats-

Rival companies such as HP, Oracle and Sun are developing similar
products
The challenge of getting the customers and software developers to
focus on the .Net message while US government fights with Microsoft
to split into two companies
Traditional windows based users and windows software developers’
old mentalities resisting change

ENVIRONMENTAL SCANNING

• The process of tracking external changes that can affect

markets, including demand for goods and services. (Marketing
Management-Kotler, Kelly, Koshi, Jha)

• The practice of keeping track of external changes-economic,

political, legal, social, institutional, technological and competitive
forces that can affect markets. (Marketing-Churchill and Peter)

• The practice that seeks to identify the trends that offer

previously untapped opportunities or can change the market for
goods and services. (Marketing-Churchill and Peter)

• Collection and interpretation of information about forces, events

and relationships in the external environment that may affect
the future of the organisation or the implementation of the
marketing plan(Marketing-Lamb, Hair, McDaniel)
• The process of monitoring external environment to influence
marketing strategy by identifying potential opportunities and
threats, trends, and strategic uncertainties (Marketing
Management-Panda)

• Process of collecting information about forces in the marketing

environment (Marketing-Pride,Fredell, Blotnicky,Grant)

➢ European car-maker FIAT , after analysing the economic

conditions in Europe, came up with the strategies of streamlining
management, creating new models and selling off pieces of
company’s holdings.

➢ During recession of the early 1990’s, mail-order house “Lands

End” advertised an attaché case at the same price tag that it
carried in 1985

➢ H&R Block, a tax preparation service, benefits from changes in

tax codes that motivate citizens to have their tax returns
prepared by a professional

➢ Several car companies have come up with hybrid cars after

scanning the market needs for environmentally friendly cars

EVALUATION OF ALTERNATIVES

• After the recognition of problem, the process wherein the

consumer evaluates through the various possible options and
choices based on a set of important attributes or features.
(Marketing-Grewal and Levy)

• Process of comparing different products and brands based on

standards and specifications(Consumer Behaviour-
Blackwell,Engel)
 • The third step of the "Buyer Decision Process" is the
"Evaluation of Alternatives." During this stage of the process,
a consumer arrives at a final set of brand choices and then
must evaluates them based on their own individual needs,
and on the specific buying situation. Companies respond to
this buy researching how various consumers evaluate brand
alternatives, and adjust their marketing accordingly. (Basic
Marketing- Cannon)

• At this stage in consumer buying process, the consumer

compares the brands and products that are in their evoked
set. Consumers evaluate alternatives in terms of the
functional and psychological benefits that they offer. The
marketing organization needs to understand what benefits
consumers are seeking and therefore which attributes are
most important in terms of making a decision.

➢ Verizon has been at a big disadvantage in the smart

phone market because of AT&T exclusive right to
distribute the iphone. They have responded with a
marketing campaign that focuses on how much larger
their 3g coverage is then AT&T's. This is because
smartphones require a fast internet connection to be of
much use. So while AT&T may have the hottest phone,
it may run extremely slow in many places where a
consumer would want to use it. That is the question
Verizon wants consumers to ask themselves when they
are evaluating brand alternatives.

EVENT CREATION
• It the skill of publicising fund-raising drives for non-profit
organisations. (Marketing Management-Kotler, Kelly, Koshi, Jha)

➢ NDTV Greenathon was to spread the message of

environmental concern

➢ The likes of Angus Deaton, Alistair Campbell, DJ Spooney and

Ben Shepherd all help raise money for the Cystic Fibrosis
Trust.

➢ P&G led a campaign called "Moms from the Heart" in alliance

with UNICEF to raise funds and awareness for programs that
fostered early childhood development. The campaign helped
P&G to achieve a strong double bottom-line result by
strengthening pampers equity and sales while significantly
reducing child mortality.

EVERYDAY LOW PRICING(EDLP)

• It takes place at the retail level. A retailer holding this policy

charges a constant low price with little or no price promotions and
special sales. These constant prices eliminate week-to-week price
uncertainty(Marketing Management-Kotler, Kelly, Koshi, Jha)

• It is a pricing strategy that promises consumers the lowest available

price without coupon clipping, waiting for discount promotions, or
comparison shopping; also called value pricing. EDLP saves retailers
the time and expense of periodic price markdowns, saves
manufacturers the cost of distributing and processing coupons, and
is believed to generate shopper loyalty. (Fundamentals of
Marketing- Stanton and Futrell)
• Everyday low price ("EDLP") is a pricing strategy promising
consumers a low price without the need to wait for sale price
events or comparison shop. EDLP saves retail stores the effort and
expense needed to mark down prices in the store during sale
 events, and to market these events; and is believed to generate
shopper loyalty
• It is a trading practice in which periodic promotional discounts are
eliminated to provide consistently lower-than-customary prices.
• Every Day Low Pricing (EDLP) strategy has proved to be a
successful innovation resulting in higher profits to supermarkets
adopting it in competition with Promotional Pricing (PROMO).
Conventional wisdom attributes this success either to lower costs or
to EDLP better serving time constrained consumers, while
discouraging cherry pickers who seek promotions.( Rajiv Lal, Ram
Rao- Stanford University,The University of Texas at Dalla)

➢ “6 Ten” outlets also offer everyday discounts on groceries

➢ “Subhiksha” medicines and vegetable stores mentioned the
savings made by the customer on that days purchases
➢ Bharti Wal-mart’s “Easy Day” retail outlets sell all products
at discounted prices
➢ The “Electronics Store” sells all electronics lower than the
MRP
➢ Since the fall of 1991, when P&G moved many of its brands
to an everyday-low-pricing strategy (EDLP). For example,
P&G eliminated trade promotions for Dawn dishwashing
liquid and then set the brand's price to a standard average
of $1.32, rather than pricing it at 99 [cents] one week and
$1.49 next.

EXCLUSIVE DISTRIBUTION

• Form of distribution that establishes on or a few dealers

within a given area(Marketing-Lamb, Hair, McDaniel)

• Use of single wholesaler or retailer to serve each

territory(Marketing-Churchill and Peter)

• Form of distribution where the supplier agrees to sell only to a

particular middleman or retailer in a given
market(Fundamentals of Marketing- Stanton and Futrell)
 • Severely limiting the number of intermediaries, in order to
maintain control over the service level and outputs offered by
resellers. (Marketing Management-Kotler, Kelly, Koshi, Jha)

• Use of few outlets in a relatively large geographical area. It is

suitable for products purchased infrequently, consumed over
a longer period of time and require service or information to
fit them to buyers needs.(Marketing-Pride,Fredell,
Blotnicky,Grant)

➢ Products such as Rolls Royce, Chris-Craft power boats,

Pettibone tower cranes are distributed under exclusive
arrangements.
➢ Radio Shack has prospered by offering electronics
manufacturers exclusivity within its stores
➢ Manufacturers of farm machinery and large construction
equipment frequently use exclusive distributorships.
➢ Italian designer label Gucci controls its distribution to
maintain its exclusive brand image
➢ Patek Philippe watches are available only in a few select
locations

EXPERIENTAL POSITIONING

• The strategic process of understanding consumer desires ,

creating(designing) and delivering a particular form of
experience, and communicating the firm’s proposed experience
to consumers in way that differentiates the brand from
competitors in the consumer’s mind. (Consumer Behaviour-
Blackwell,Engel)
 • The experiential platform which includes a dynamic, multi-
sensory,multi-dimensional depiction of the desired experience
(referred to as the “experiential positioning”) and a specification
of the experiential value (“the experiential value promise”) that
the customer can expect from the product or service.

➢ Singapore Airlines focuses on delivering an extraordinary

experience—“a great way to fly”—through outstanding service.
The company has thought through every step of the customer
experience, even in economy class.

➢ Amazon.com provides a marvelous online shopping experience.

The site has the right look and feel, as well as an amazing
interface. Amazon.com is continuously improving on the
experience it provides.
➢ Drying net by surf excel detergent cake.

➢ Appolo Tyres with Hand bag to carry the tyre easily.

➢ Harpic nozzle pack for easy cleaning of closet of toilet.

FAD

• A craze that is unpredictable, short-lived, and without social,

economic and political significance(Marketing Management-Kotler,
Kelly, Koshi, Jha)
• A short-lived fashion that is usually based on some novelty feature
(Fundamentals of Marketing- Stanton and Futrell)
• Products that experience an intense but brief period of
popularity(Marketing-Churchill and Peter)
• A fashion that is taken up with great enthusiasm for a brief period
of time; a craze.
• A fad is a practice or interest followed for a time with exaggerated
zeal. (Consumer Behaviour-Blackwell,Engel)
• A desirable trend characterized with lots of enthusiasm
and energy over a short period of time. Fads are often seen
with common consumer items, especially around a holiday season
(Basic Marketing- Cannon)
• A Fad is an extraordinary appeal, the public adores, for a brief
period in time.

➢ Ex:The Beanie Baby ( a stuffed animal, made by Ty Warner

Inc.) became a phenomenon in the late 1990s when Beanie
Babies became both a fad and a collectible. The craze lasted
through 1999 and slowly declined.

➢ A growing group of American abstract Artists began the

‘Optical Art’ movement. For about a year, these fashion
followers only wore black and white.

➢ Leveraged buy-outs (Takeover of a company or controlling

interest in a company, using a significant amount of borrowed
money) were used frequently in the 1980s
for companies looking for acquire rivals, suppliers, and other
related entities. In the late 1990s though, LBOs became less
popular.

➢ The spectacular vintage ties and skinny ties worn on the

program Mad men on AMC(1960’s), turned into a huge fad in
men’s fashion.

FAMILY BRANDING

• Marketing of several products under the same brand name.

(Marketing-Lamb, Hair, McDaniel)

• Use of same brand name for the entire product

line(Marketing-Churchill and Peter)
 • When all products are sold under one corporate name. The
individual brands benefit from the overall brand awareness
associated with the family brand. .(Marketing-Grewal and
Levy)

• The use of the same family or blanket brand name for all
products in a firms product line(Fundamentals of Marketing-
Stanton and Futrell)

• Situation where the parent brand is already associated with

multiple products through brand extensions. (Marketing
Management-Kotler, Kelly, Koshi, Jha)

➢ Sony’s family brands include music systems, TVs, DVD

players, etc

➢ Holiday Inn portfolio is as- Holiday Inn Select, Holiday Inn

Suites, Holiday Inn Hotels, etc

➢ Gillette Company uses the family brand Gillette Series for a

line of men’s shaving products, deodorants and after-
shaves.

➢ General Electric Company (GE) brands its appliances

prominently with the GE brand name.

➢ All products sold through The Gap stores bear only The
Gap brand name.

➢ When Black and Decker purchased General Electrics’ line

of small appliances, the Black and Decker brand was put
on those appliances.

FEATURE
 • A fact or technical specification about a product. Marketers
select product features by determining what their customers
want their products to offer. (Marketing –Churchill and Peter)

• Specifications about a product that enhance its value and

supplementtheir basic function. (Marketing Management-
Kotler, Kelly, Koshi, Jha)

➢ Tiny spring in the handle of a GSK Flex Toothbrush, to

help prevent overly vigorous brushing from damaging
gums

➢ Gillette’s Oral-B toothbrushes include a patch of clue

bristles , whose fading indicates the time to change the
brush

➢ Extra chocolates, nuts, fudge and pieces of brownie in

the Haagen-Dazs Triple Brownie Overload ice-cream

➢ The Zen Estilo VXi model has airbags and electronic

power steering.

FEATURE IMPROVEMENT

• Adding new features, such as size , weight, materials,

additives, and accessories that expand the products
performance, versatility, safety or convenience(Marketing
Management-Kotler, Kelly, Koshi, Jha)

➢ Coca-cola replaced its old formula with the New Coke, a

sweeter variation of the old drink

➢ Bajaj introduced several models of Pulsar with improved

looks, engine, power, etc
 ➢ Pepsi and Coke offer drinks in different sizes-5ooml, 1 ltr,
1.5ltr, 2ltr

FORWARD INVENTION

• Creating a new product to meet a need in another

country(Marketing Management-Kotler, Kelly, Koshi, Jha)

• The process of creating a new a product, or modifying an

existing product in order to capture a new market. (International
Marketing-Cateora Graham)

➢ Haagen Dazs created an ice-cream flavour for sale solely

in Argentina

➢ Philips had to change the size of its coffeemakers in Japan

to fit the size of their small kitchens

➢ Quaker Oats researches the countries nutrition needs and

formulates new products

➢ BMW modifies the ground clearance of some of its cars in

India in accordance to the roads

FRANCHISING

• It is a form of licensing, in which the company (the franchiser)

grants a franchisee the right to market its product, using its name,
logo, methods of operation, advertising, products, and other
elements associated with the franchisers business, in return for a
financial commitment and an agreement to conduct business in
 accordance with the franchisers standard of operations.(Marketing
Management-Kotler, Kelly, Koshi, Jha)

• It is a rapidly growing form of licensing in which the franchisor

provides a standard package of products, systems, and
management services, and the franchisee provides ,market
knowledge, capital and personal involvement in management.
(International Marketing-Cateora Graham)

➢ Subway, The UPS Store, Pizza Hut, KFC Corp.,etc are amongst
the worlds top 10 global franchisers.

➢ Holiday Inn Marriott, Mc Donalds are amongst the well known

franchisers with international visibility.

FIXED PERSONALITY ASSOCIATION

A qualitative technique used by a moderator where images of people,

places, or things are shown to participants and they are then asked to
interpret the pictures around a given topic. The same images are
shown in several sessions to different respondents so that results can
be applied as norms.

FOREHEAD ADVERTISING

Forehead Advertising is an advertising concept that uses people's

foreheads as advertising spaces. The concept was created by Justin
Kapust through his organization, called Headvertise (Kapust-Allen
Enterprises, now defunct) in late 2002
Soon after its launch, and the media frenzy that came along with it,
Ebay started hosting auctions for forehead advertising and other tattoo
advertising.
Headvertise hired college students to run advertising campaigns for its
clients on college campuses, where through affinity programs and
exclusive marketing rights, many companies cannot advertise.

FORMAL SEARCH
This is a purposeful search after information in some systematic way.
The information will be required to address a specific issue. Whilst this
sort of activity may seem to share the characteristics of marketing
research it is carried out by the manager him/herself rather than a
professional researcher. Moreover, the scope of the search is likely to
be narrow in scope and far less intensive than marketing research

FRONTIER OFFERINGS
Products and bundled services that sell at the lowest price in their
performance range. If an offering provides both the lowest price and
best performance, it dominates every other offering in the category.

FULL MARKET COVERAGE STRATEGY

One of the market-targeting strategies in which a company attempts
to serve all customer groups (segment) with all the products they
might need. Normally, very large firms can follow full market coverage
strategy. Large companies can cover a whole market in two broad
ways: through undifferentiated marketing or differentiated marketing.

GATEKEEPER
A person who allows certain information to flow & restricts flow of
some set of information. Parents play the role of gatekeeper in the
selection of TV channels for children. Member of a decision-making
unit who decides the limiting factors and constraints in the decision of
purchase of a product. This person has an overall impact on the buying
decision by specifying some factors and conditions under which a
particular product can be bought .For example, the budget maybe
fixed by the gatekeeper, the father to be say up to a max of 50,000 for
a bike to be bought by the son.

GENERATION OF ALTERNATIVES
The process by which a consumer generates alternative solutions or
identifies alternative products that help achieve a solution to the
problem he has identified or satisfy a need. However, these alternative
solutions help the same level of utility that he would have achieved if
he would have gone with the original solution or product

GENERIC BRAND
No-frills goods stocked by some retailers. These items usually receive
secondary shelf locations, have little or no promotion support, are
sometimes of less overall quality than other brands, are stocked in
limited assortments, and have plain packages.

GEOGRAPHIC SEGMENTATION
Geographical segmentation divides markets into different geographical
areas. Marketers use geographic segmentation because consumers in
different areas may display certain characteristics and behaviours in
that particular region, for example, in London UK certain parts of the
West End of London are more affluent then the East End and you will
find particular products sold in these regions based on their affluence.
An area can be divided by the town, the region or the country. If you
are an organisation working on a global scale you may divide by global
regions such as Europe, North America, South America, Asia and
Africa. Mcdonalds globally, sell burgers aimed at local markets, for
example, burgers are made from lamb in India rather then beef
because of religious issues. In Mexico more chilli sauce is added and so
on.
Market segmentation strategy whereby the intended audience for a
given product is divided according to geographic units, such as
nations, states, regions, counties, cities, or neighborhoods. Marketers
will tailor marketing programs to fit the needs of individual geographic
areas, localizing the products, advertising, and sales effort to
geographic differences in needs and wants. Marketers will also study
the population density or regional climate as factors of geographic
segmentation.

GEOGRAPHIC INFORMATION SYSTEMS

Geographic information systems (GIS) or geospatial information
systems is a set of tools that captures, stores, analyzes, manages, and
presents data that are linked to location(s). In the simplest terms, GIS
is the merging of cartography, statistical analysis, and database
technology. GIS may be used in archaeology, geography, cartography,
remote sensing, land surveying, public utility management, natural
resource management, precision agriculture, photogrammetry, urban
planning, emergency management, navigation, aerial video, and
localized search engines.
As GIS can be thought of as a system, it digitally creates and
"manipulates" spatial areas that may be jurisdictional, purpose or
application oriented for which a specific GIS is developed. Hence, a GIS
developed for an application, jurisdiction, enterprise, or purpose may
not be necessarily interoperable or compatible with a GIS that has
been developed for some other application, jurisdiction, enterprise, or
purpose. What goes beyond a GIS is a spatial data infrastructure (SDI),
a concept that has no such restrictive boundaries.
Therefore, in a general sense, the term describes any information
system that integrates, stores, edits, analyzes, shares, and displays
geographic information for informing decision making. GIS applications
are tools that allow users to create interactive queries (user-created
searches), analyze spatial information, edit data, maps, and present
the results of all these operations. Geographic information science is
the science underlying the geographic concepts, applications and
systems. GIS can be studied in degree and certificate programs at
many universities.

GEOGRAPHICAL PRICING
Geographical pricing, in marketing, is the practice of modifying a basic
list price based on the geographical location of the buyer. It is intended
to reflect the costs of shipping to different locations.
There are several types of geographic pricing:
FOB origin - The shipping cost from the factory or warehouse is paid by
the purchaser. Ownership of the goods is transferred to the buyer as
soon as it leaves the point of origin. It can be either the buyer or seller
that arranges for the transportation.
Uniform delivery pricing - (also called postage stamp pricing) - The
same price is charged to all.
Zone pricing - Prices increase as shipping distances increase. This is
sometimes done by drawing concentric circles on a map with the plant
or warehouse at the center and each circle defining the boundary of a
price zone. Instead of using circles, irregularly shaped price boundaries
can be drawn that reflect geography, population density,
transportation infrastructure, and shipping cost.
Basing point pricing - Certain cities are designated as basing points. All
goods shipped from a given basis point are charged the same amount.
Freight-absorption pricing - The seller absorbs all or part of the cost of
transportation. This amounts to a price discount, and is used as a
promotional tactic.

GLOBAL FOCUS GROUPS

Focus groups conducted using satellite video technology in which
participants are located in different places, normally in different
countries. Also called video focus groups.
These are focus groups that instead of meeting face-to-face, carry out
the group via a video conferencing link.

GLOBAL MARKETING
The Oxford University Press defines global marketing as “marketing on
a worldwide scale reconciling or taking commercial advantage of
global operational differences, similarities and opportunities in order to
meet global objectives.” Oxford University Press’ Glossary of Marketing
Terms.
Here are three reasons for the shift from domestic to global marketing
as given by the authors of the textbook, Global Marketing
Management—3rd Edition by Masaaki Kotabe and Kristiaan Helsen,
2004.
The “Four P’s” of marketing: product, price, placement, and promotion
are all affected as a company moves through the five evolutionary
phases to become a global company. Ultimately, at the global
marketing level, a company trying to speak with one voice is faced
with many challenges when creating a worldwide marketing plan.
Unless a company holds the same position against its competition in
all markets (market leader, low cost, etc.) it is impossible to launch
identical marketing plans worldwide.
Product
A global company is one that can create a single product and only
have to tweak elements for different markets. For example, Coca-Cola
uses two formulas (one with sugar, one with corn syrup) for all
markets. The product packaging in every country incorporates the
contour bottle design and the dynamic ribbon in some way, shape, or
form. However, the bottle or can also includes the country’s native
language and is the same size as other beverage bottles or cans in
that same country.
Price
Price will always vary from market to market. Price is affected by many
variables: cost of product development (produced locally or imported),
cost of ingredients, cost of delivery (transportation, tariffs, etc.), and
much more. Additionally, the product’s position in relation to the
competition influences the ultimate profit margin. Whether this
product is considered the high-end, expensive choice, the economical,
low-cost choice, or something in-between helps determine the price
point.
Placement
How the product is distributed is also a country-by-country decision
influenced by how the competition is being offered to the target
market. Using Coca-Cola as an example again, not all cultures use
vending machines. In the United States, beverages are sold by the
pallet via warehouse stores. In India, this is not an option. Placement
decisions must also consider the product’s position in the market
place. For example, a high-end product would not want to be
distributed via a “dollar store” in the United States. Conversely, a
product promoted as the low-cost option in France would find limited
success in a pricey boutique.
Promotion
After product research, development and creation, promotion
(specifically advertising) is generally the largest line item in a global
company’s marketing budget. At this stage of a company’s
development, integrated marketing is the goal. The global corporation
seeks to reduce costs, minimize redundancies in personnel and work,
maximize speed of implementation, and to speak with one voice. If the
goal of a global company is to send the same message worldwide,
then delivering that message in a relevant, engaging, and cost-
effective way is the challenge.
Effective global advertising techniques do exist. The key is testing
advertising ideas using a marketing research system proven to provide
results that can be compared across countries. The ability to identify
which elements or moments of an ad are contributing to that success
is how economies of scale are maximized. Market research measures
such as Flow of Attention, Flow of Emotion and branding moments
provide insights into what is working in an ad in any country because
the measures are based on visual, not verbal, elements of the ad.

GOODNESS OF THE DEAL

an evaluation of whether or not the customer paid a fair price for a
product. A good deal is where the customer pays a price that is less
than the fair price (as determined by the product’s relative
performance.

GREY MARKET
A grey market or gray market also known as parallel market is the
trade of a commodity through distribution channels which, while legal,
are unofficial, unauthorized, or unintended by the original
manufacturer. The term gray economy, however, refers to workers
being paid under the table, without paying income taxes or
contributing to such public services as Social Security and Medicare. It
is sometimes referred to as the underground economy or "hidden
economy."
A black market is the trade of goods and services that are illegal in
themselves and/or distributed through illegal channels, such as the
selling of stolen goods, certain drugs or unregistered handguns. The
two main types of grey market are imported manufactured goods that
would normally be unavailable or more expensive in a certain country
and unissued securities that are not yet traded in official markets.
Sometimes the term dark market is used to describe secretive,
unregulated (though often technically legal) trading in commodity
futures, notably crude oil in 2008. This can be considered a third type
of "grey market" since it is legal, yet unregulated, and probably not
intended or explicitly authorized by oil producers.

GREEN MARKETING
According to the American Marketing Association, green marketing is
the marketing of products that are presumed to be environmentally
safe. Thus green marketing incorporates a broad range of activities,
including product modification, changes to the production process,
packaging changes, as well as modifying advertising. Yet defining
green marketing is not a simple task where several meanings intersect
and contradict each other; an example of this will be the existence of
varying social, environmental and retail definitions attached to this
term.[1] Other similar terms used are Environmental Marketing and
Ecological Marketing.
The legal implications of marketing claims call for caution. Misleading
or overstated claims can lead to regulatory or civil challenges. In the
USA, the Federal Trade Commission provides some guidance on
environmental marketing claims

GUERRILLA MARKETING
The concept of guerrilla marketing was invented as an unconventional
system of promotions that relies on time, energy and imagination
rather than a big marketing budget. Typically, guerrilla marketing
campaigns are unexpected and unconventional; potentially interactive;
and consumers are targeted in unexpected places. The objective of
guerrilla marketing is to create a unique, engaging and thought-
provoking concept to generate buzz, and consequently turn viral. The
term was coined and defined by Jay Conrad Levinson in his book
Guerrilla Marketing. The term has since entered the popular
vocabulary and marketing textbooks.
Guerrilla marketing involves unusual approaches such as intercept
encounters in public places, street giveaways of products, PR stunts,
any unconventional marketing intended to get maximum results from
minimal resources. More innovative approaches to Guerrilla marketing
now utilize cutting edge mobile digital technologies to really engage
the consumer and create a memorable brand experience.

HETEROGENEOUS MARKET
A market characterized by buyers with different needs and wants. A
company utilizes a concentrated targeting strategy for this group. This
market requires the company to divided the market into groups by a
process called market segmentation. The company then develops a
different marketing mix to satisfy each of these groups or segments.

Eg. Taking India as a market.

HEURISTICS

Heuristic or heuristics refers to experience-based techniques for

problem solving, learning, and discovery. Heuristic methods are used
to identify an optimal solution as rapidly as possible. Examples of this
method include using a "rule of thumb", an educated guess, an
intuitive judgment, or common sense.
In more precise terms, heuristics are strategies using readily
accessible, though loosely applicable, information to control problem
solving in human beings and machines
HOME USAGE TEST
Product testing is, perhaps, the single-most-important type of
consumer research any company ever conducts. A company with
consistently superior products tends to consistently outperform its
competitors in the marketplace.
Achieving clear-cut product superiority in a category is the surest
way to build brand share, engender customer loyalty, and boost
profitability. Better products tend to command higher prices and be
more responsive to advertising investments.

HOMOGENEOUS PREFERENCES:
This refers to pattern of consumer preferences in terms of various
attributes of a product or service. One of the preferences is known, as
homogeneous preferences where all the consumers have roughly the
same preferences. The market shows no natural segments.

HOMOGENOUS MARKET
In general, the notion that everything has identical characteristics. For
example, a neighborhood might have a homogeneous culture,
meaning everyone has similar income, religious preferences, and
political views. In economics, it is used in a couple of different ways.
One is for production, such that two or more goods are homogeneous
if they are physically identical or at least viewed as identical by
buyers. Another is for mathematical equations, such that an equation
is said to be homogeneous if the independent variables are increased
by a constant value, then the dependent variable is increased by a
function of that value. In a marketing context, this is a market
characterized by buyers with similar needs and wants. This group is
targeted with an undifferentiated targeting strategy. The company
uses only one marketing mix to satisfy this group of buyers.

HORIZONTAL MARKETING SYSTEM

Two or more unrelated companies put together resources or programs
to exploit an emerging marketing opportunity.

IN-STORE DEMONSTRATION
In marketing, an in-store demonstration (or "demo" for short) is a
promotion where samples of a product are distributed to customers
within a store. The goal of an in-store demonstration is to introduce
customers to the product in hopes of getting them to purchase that
item. Products that often are sampled during in-store demonstrations
are new products or new versions of already existing products that
have recently been introduced to the commercial marketplace, and
that the manufacturers are attempting to advertise.
Examples:
1) The electronic and electrical appliances companies do in-store
demonstration.
2) Clothes can be tried before purchasing in most of the
showrooms.

INDUSTRIAL PRODUCT

Industrial product are bought by individuals or organizations for further

processing or for use in conducting a business. Eg) generators, drill
presses, large computer systems, elevators, etc which help in
industrial operations

INFLUENCER

Influencer member of a decision-making unit who has an impact on

the buying decision but is not the decision maker. For example, a child
may influence the choice of breakfast cereal, but the purchase
decision is made by the parent. Influencers have varying levels of
influence depending on the product and their relative status in the
decision-making unit. A small child will have no influence on an
automobile purchase. A teenager may have some influence and a
spouse usually has a lot of influence on an automobile purchase
decision. A person who explicitly or implicitly has some influence on
the final buying decision of others. Mother plays role of influence in the
purchase of chocolate

INFORMAL SEARCH

this describes the situation where a fairly limited and unstructured

attempt is made to obtain information for a specific purpose. For
example, the marketing manager of a firm considering entering the
business of importing frozen fish from a neighbouring country may
make informal inquiries as to prices and demand levels of frozen and
fresh fish. There would be little structure to this search with the
manager making inquiries with traders he/she happens to encounter
as well as with other ad hoc contacts in ministries, international aid
agencies, with trade associations, importers/exporters etc
INFORMATION MANAGEMENT PROCESSES

with many professionals having external information delivered to their

desktops, from online services such as reuters or maid, and
increasingly from the internet is easy to believe that users have all the
information they need on tap. However, this is raw information and will
need transforming into intelligence. Before that, however, this
information must be classified, stored and made accessible - applying
good practice principles of information resources management (irm).

INFORMATION SYSTEM (IS)

An information system (IS) is any combination of information

technology and people's activities using that technology to support
operations, management, and decision-making.in a very broad sense,
the term information system is frequently used to refer to the
interaction between people, algorithmic processes, data and
technology. In this sense, the term is used to refer not only to
the information and communication technology (ICT) an organization
uses, but also to the way in which people interact with this technology
in support of business processes.
Some make a clear distinction between information systems,and
computer systems ict, and business processes. Information systems
are distinct from information technology in that an information system
is typically seen as having an ict component. Information systems are
also different from business processes. Information systems help to
control the performance of business processes.

Examples:

Transaction processing systems

Office systems
Decision support systems
Knowledge management
INITIATOR

Initiator a person who first suggests or thinks of the idea of buying the
particular product. The person who feels the need for the purchase of a
product. Example, a child plays role of initiator in the purchase of a
chocolate.

INSTITUTIONAL MARKET

Schools, markets, nursing homes, prisons and other institutions that

must provide goods and services to people in their care.

INTEGRATED LOGISTICS SYSTEM

Materials management, material flows system, and physical

distribution, abetted by information technology.

INTEGRATED MARKETING COMMUNICATIONS

A concept of marketing communications planning that recognizes the

added value of a comprehensive plan.

INTELLIGENCE DEVELOPMENT PROCESSES

a good intelligence system is more than information. It is a recurring

cycle of linking the needs of decision makers to the processes of
turning the information into actionable intelligence.

INDIVIDUAL MARKETING

The ultimate level of segmentation leads to “segments of one,”

“customized marketing,” or “one-to-one marketing.”

For centuries, consumers were served as individuals: The tailor made

the suit and the cobbler designed shoes for the individual. Much
business to-business marketing today is customized, in that a
manufacturer will customize the offer, logistics, communications, and
financial terms for each major account. Such technologies such as
computers, databases, robotic production, intranets and extranets, e-
mail, and fax communication are permitting companies to return to
customized marketing, also called “mass customization.”

Mass customization is the ability to prepare individually designed

products and communications on a mass basis to meet each
customer’s requirements. For example, Andersen Windows, a $1 billion
Minnesota-based manufacturer of residential windows, turned to mass
customization after additions to its product line led to fat, unwieldy
catalogs and a bewildering array of choices for homeowners and
contractors. Then the firm equipped 650 showrooms with an
interactive computer catalog linked directly to the factory. Using this
catalog, salespeople help customers customize each window, check
the design for structural soundness, and generate a price quote.
Andersen has also developed a “batch of one” manufacturing process
in which everything is made to order, thus reducing its finished parts
inventory (a major cost to the company).

Joseph Pine, author of Mass Customization, says, “Anything you can

digitize, you can customize.” In fact, the Internet is bringing mass
customization to an astonishing array of products. Mattel’s Barbie.com
site invites girls to log on and design their own Barbie Pal doll by
specifying skin tone, eye color, hairdo and hair color, clothes,
accessories, and name. CDuctive, a hip, New York-based company, lets
customers cut their own CDs online. If a customer likes acid jazz, he
can click on the category, see the various titles, listen to a brief sample
of each, and then click to order a CD with his chosen tunes.

Technology like this is transforming marketing from “a broadcast

medium to a dialog medium,” allowing the customer to actively
participate in the design of the product and offer. Although individual
customers are taking more initiative in designing and buying products,
marketers still need to influence the process in a variety of ways. They
need toll-free phone numbers and e-mail addresses to enable buyers
to reach them with questions, suggestions, and complaints; they must
involve customers more in the product-specification process; and they
need a Web site with complete, updated information about the
company’s products, service guarantees, and locations.

IDEA GENERATION
The marketing concept holds that customer needs and wants are the
logical place to start the search for new product ideas. Hippel has
shown that the highest percentage of ideas for new industrial products
originates with customers. Many of the best ideas come from asking
customers to describe their problems with current products. For
instance, in an attempt to grab a foothold in steel wool soap pads, 3M
organized consumer focus groups and asked about problems with
these products.

INFLUENCE MARKETING
Influencer marketing, (also Influence Marketing) is a form of marketing
that has emerged from a variety of recent practices and studies, in
which focus is placed on specific key individuals (or types of individual)
rather than the target market as a whole. It identifies the individuals
that have influence over potential buyers, and orients marketing
activities around these influencers.
Influencers may be potential buyers themselves, or they may be third
parties. These third parties exist either in the supply chain (retailers,
manufacturers, etc.) or may be so-called value-added influencers (such
as journalists, academics, industry analysts, professional advisers, and
so on).
Most discussion on the generic topic of social influence centres on
compliance and persuasion in a social environment, as exemplified in
Robert Cialdini’s book Influence: Science and Practice. In the context of
Influencer Marketing, influence is less about argument and coercion to
a particular point of view, and more about loose interactions between
various parties in a community. Influence is often equated to
advocacy, but may also be negative, and is thus related to concepts of
promoters and detractors.

INFLUENCER MARKETING AS A MARKETING DISCIPLINE

Influencer Marketing, as increasingly practiced in a commercial
context, comprises four main activities:
Identifying influencers, and ranking them in order of importance.
Marketing to influencers, to increase awareness of the firm within the
influencer community
Marketing through influencers, using influencers to increase market
awareness of the firm amongst target markets
Marketing with influencers, turning influencers into advocates of the
firm.
Influencer Marketing is enhanced by a continual evaluation activity
that sits alongside the four main activities.
Influencer Marketing is not synonymous with word of mouth marketing
(WOM), but influence may be transmitted in this manner. Thus WOM is
a core part of the mechanics of Influencer Marketing.
There are substantial differences in the definition of what an influencer
is. Peck defines influencers as "a range of third parties who exercise
influence over the organization and its potential customers". Similarly,
Brown and Hayes define an influencer as "a third party who
significantly shapes the customer's purchasing decision, but may
never be accountable for it.” The Word of Mouth Marketing Association
defines an influencer as "A person who has a greater than average
reach or impact through word of mouth in a relevant marketplace.
Keller and Berry note that influencers are activists, are well-connected,
have impact, have active minds, and are trendsetters, though this set
of attributes is aligned specifically to consumer markets.

INTERMEDIARIES
Intermediaries known as merchants—such as wholesalers and retailers
—buy, take title to, and resell the merchandise. Agents—brokers,
manufacturers’ representatives and sales agents—search for
customers and may negotiate on the producer’s behalf but do not take
title to the goods. Facilitators—transportation companies, independent
warehouses, banks, and advertising agencies—assist in the distribution
process but neither take title to goods nor negotiate purchases or
sales. The most successful companies search for innovative marketing
channels. The Conn Organ Company, for example, sells organs through
merchants such as department and discount stores, drawing more
attention than it ever enjoyed in small music stores. Similarly, Ohio-
based Provident Bank reaches new mortgage customers by selling
through the lendingtree.com Web site, which acts as a facilitator.
Number of Intermediaries In deciding how many intermediaries to use,
successful companies use one of three strategies:
➤ Exclusive distribution means severely limiting the number of
intermediaries. Firms such as automakers use this approach when they
want to maintain control over the service level and service outputs
offered by the resellers. Often it involves exclusive dealing
arrangements, in which the resellers agree not to carry competing
brands.
➤ Selective distribution involves the use of more than a few but less
than all of the intermediaries who are willing to carry a particular
product. In this way, the producer avoids dissipating its efforts over too
many outlets, and it gains adequate market coverage with more
control and less cost than intensive distribution. Nike, for example,
sells its athletic shoes and apparel through seven types of outlets:
(1) specialized sports stores, which carry a special line of athletic
shoes; (2) general sporting goods stores, which carry a broad range of
styles; (3) department stores, which carry only the newest styles; (4)
mass-merchandise stores, which focus on discounted styles; (5) Nike
town stores, which feature the complete line; (6) factory outlet stores,
which stock mostly seconds and closeouts, and (7) the popular Fogdog
Sports site (www.fogdog.com), its exclusive Web retailer.
➤ Intensive distribution consists of the manufacturer placing the goods
or services in as many outlets as possible. This strategy is generally
used for items such as tobacco products, soap, snack foods, and gum,
products for which the consumer requires a great deal of location
convenience.

INTEGRATED MARKETING
When all of the company’s departments work together to serve the
customers’ interests, the result is integrated marketing. Integrated
marketing takes place on two levels.
First, the various marketing functions—sales force, advertising,
customer service, product management, marketing research—must
work together. All of these functions must be coordinated from the
customer’s point of view.
Second, marketing must be embraced by the other departments.
According toDavid Packard of Hewlett-Packard: “Marketing is far too
important to be left only tothe marketing department!” Marketing is
not a department so much as a companywide orientation. Xerox, for
example, goes so far as to include in every job description an
explanation of how each job affects the customer. Xerox factory
managers know that visits to the factory can help sell a potential
customer if the factory is clean and efficient. Xerox accountants know
that customer attitudes are affected by Xerox’s billing accuracy. To
foster teamwork among all departments, the company must carry out
internal marketing as well as external marketing. External marketing is
marketing directed at people outside the company. Internal marketing
is the task of hiring, training, and motivating able employees who want
to serve customers well. In fact, internal marketing must precede
external marketing. It makes no sense to promise excellent service
before the company’s staff is ready to provide it.
Managers who believe the customer is the company’s only true “profit
center” consider the traditional organization chart—a pyramid with the
CEO at the top, management in the middle, and front-line people and
customers at the bottom—obsolete.
Master marketing companies invert the chart, putting customers at the
top. Next in importance are the front-line people who meet, serve, and
satisfy the customers; under them are the middle managers, who
support the front-line people so they can serve the customers; and at
the base is top management, whose job is to hire and support good
middle managers.

INTERNAL MARKETING
Internal marketing (IM) is a process that occurs within a company or
organization whereby the functional process aligns, motivates and
empowers employees at all management levels to deliver a satisfying
customer experience. Over recent years internal marketing has
increasingly been integrated with employer branding, and employer
brand management, which strives to build stronger links between the
employee brand experience and customer brand experience.
According to Burkitt and Zealley, "the challenge for internal marketing
is not only to get the right messages across, but to embed them in
such a way that they both change and reinforce employee behaviour".

INTERNAL MARKETING-ORIENTED BUSINESS

The following are the features of an internal marketing-oriented
business:
Creating enabling culture: this is done when employees are
empowered by management through allowing creativity, innovation,
allowing initiatives and accountability and responsibility of their
decisions.
Practicing participative hiring: that is involving current employees in
the process of hiring new employees.
Ensuring equitable recognition and reward: business must exercise
employee recognition with reward to what employee has achieved.
Demonstrating fairness during hard times: fair treatment of employees
when faced with hard times and difficult moments like death of the
near family members. This can be achieved by setting aside
emergency funds.
Good organization structure that allows learning, total quality
management and re-engineering.
Benefits of Internal Marketing:
Encourages the internal market (employees) to perform better;
Empowers employees and gives them accountability and
responsibility;
Creates common understanding of the business organisation;
Encourages employees to offer superb service to clients by
appreciating their valuable contribution to the success of the business;
Helps non-marketing staff to learn and be able to perform their tasks
in a marketing-like manner;
Improves customer’s retention and individual employee development;
Integrates business culture, structure, human resources management,
vision and strategy with the employees' professional and social needs;
Creates good coordination and cooperation among departments of the
business.

INTERNAL BRANDING
Internal Branding is a concept that merges the disciplines of marketing
and human resources. Developed by Dr Nikolaus Eberl and Herman
Schoonbee as an academic discipline, Internal Branding is about
aligning employee commitment to delivering the brand promise of the
organisation.

The Role of Internal Branding

Nothing kills a poor product faster than good advertising.
Retaining clients over time requires not only that they have a positive
experience with the brand, but also that they can identify with the
brand character – this being the people in the company and the degree
to which they can be trusted to deliver the brand promise.

The Janus Effect of Internal Branding

Clearly, a company’s brand promise and its brand character
must be linked and compatible. There is a phenomenon in
organizations that can be termed the ‘Janus Effect.’ Janus was the
Roman god of initiation and closure. As such, he was seen as a god of
the doorway and depicted with two faces, one facing out and one
facing in.
The Janus Effect in organizations represents a simple but
profound proposition: The face a company presents to its customers
and the general public is in large part a reflection of the face it
presents to its employees. Thus, the way customers view the company
is significantly enhanced, or diminished, by the way employees view
the company.

Measuring Brand Strength

The strength of a brand is built both through communication and
the experience with the brand. Brand strength initially depends on the
Hygiene Factors, i.e. awareness and consideration, which are driven by
communication and influenced by acquisition drivers such as
functionality.
Strengthening or weakening the brand then depends on the
Differentiating Factors, i.e. brand preference and brand loyalty, which
are formed from the client’s experience with the brand and influenced
by the retention drivers.

Measuring Brand Value

If your brand is listed on the stock exchange, the answer is easy
– your market capitalisation less assets. In the case of the world’s
leading brand, Coca-Cola, the brand value exceeds the asset value by
nearly 150%.
As Richard Branson put it at his recent visit to South Africa, “the brand
is everything. If the brand is well-respected and trusted, people will
give it a try.” The Virgin Brand is a classic example of brand value
exceeding the asset base by far. In fact, the Virgin brand has now
become so valuable that Branson has recently ventured into space. In
September 2004, he announced that Virgin had signed a deal to offer
the world's first commercial flights to space under the brand ‘Virgin
Galactic’.

INTERNAL RECORDS SYSTEM

Marketing managers rely on internal reports on orders, sales, prices,
costs, inventory levels, receivables, payables, and so on. By analyzing
this information, they can spot important opportunities and problems.
THE ORDER-TO-PAYMENT CYCLE
The heart of the internal records system is the order-to-payment cycle.
Sales representatives, dealers, and customers dispatch orders to the
firm. The sales department prepares invoices and transmits copies to
various departments. Out-of-stock items are back ordered. Shipped
items are accompanied by shipping and billing documents that are
sent to various departments. Today’s companies need to perform
these steps quickly and accurately. Customers favor those firms that
can promise timely delivery. Customers and sales representatives fax
or e-mail their orders. Computerized warehouses fulfill these orders
quickly. The billing department sends out invoices as quickly as
possible. An increasing number of companies are using electronic data
interchange (EDI) or intranets to improve the speed, accuracy, and
efficiency of the order-to-payment cycle. Retail giant Wal-Mart tracks
the stock levels of its products and its computers send automatic
replenishment orders to its vendors.
SALES INFORMATION SYSTEMS
Marketing managers need up-to-the-minute reports on current sales.
Armed with laptop computers, sales reps can access information about
prospects and customers and provide immediate feedback and sales
reports. An ad for Sales CTRL, a sales force automation software
package, boasts, “Your salesperson in St. Louis knows what Customer
Service in Chicago told their customer in Atlanta this morning. Sales
managers can monitor everything in their territories and get current
sales forecasts anytime.”
Sales force automation (SFA) software has come a long way. Earlier
versions mainly helped managers track sales and marketing results or
acted as glorified datebooks. Recent editions have put even more
knowledge at marketers’ fingertips, often through internal “push” or
Web technology, so they can give prospective customers more
information and keep more detailed notes. Here are three companies
that are using computer technology to design fast and comprehensive
sales reporting systems:
■ Ascom Timeplex, Inc. Before heading out on a call, sales reps at this
telecommunications equipment company use their laptop computers
to dial into the company’s worldwide data network. They can retrieve
the latest price lists, engineering and configuration notes, status
reports on previous orders, and e-mail from anywhere in the company.
And when deals are struck, the laptop computers record each order,
double-check the order for errors, and send it electronically to
Timeplex headquarters in Woodcliff Lake, New Jersey.
■ Alliance Health Care Formerly called Baxter, Alliance supplies
hospital purchasing departments with computers so that the hospitals
can electronically transmit orders directly to Alliance. The timely
arrival of orders enables Alliance to cut inventories, improve customer
service, and obtain better terms from suppliers for higher volumes.
Alliance has achieved a great advantage over competitors, and its
market share has soared.
■ Montgomery Security In 1996, San Francisco–based Montgomery
Security was in a bind. To remain competitive in the financial sector,
this Nations Banks subsidiary had to find a way for more than 400
finance, research, and Gathering Information and Measuring Market
Demand sales or trading employees to share information about
companies whose stock they were considering taking public. Yet all of
the departments at Montgomery had different database formats for
their records; some even kept files on notepads. The company solved
the problem with Sales Enterprise Software from Siebel Systems. It
gave Montgomery significant gains in productivity. With a common
database format, everyone could share information and keep
confidential information secure.
The company’s marketing information system should represent a
cross between what managers think they need, what managers really
need, and what is economically feasible. An internal MIS committee
can interview a cross-section of marketing managers to discover their
information needs. Some useful questions are:
1. What decisions do you regularly make?
2. What information do you need to make these decisions?
3. What information do you regularly get?
4. What special studies do you periodically request?
5. What information would you want that you are not getting now?
6. What information would you want daily? Weekly? Monthly? Yearly?
7. What magazines and trade reports would you like to see on a
regular basis?
8. What topics would you like to be kept informed of?
9. What data analysis programs would you want?
10. What are the four most helpful improvements that could be made
in the present marketing information system?

LABELLING
Every physical product must carry a label, which may be a simple tag
attached to the product or an elaborately designed graphic that is part
of the package.
Labels perform several functions. First, the label identifies the product
or brand—for instance, the name Sunkist stamped on oranges. The
label might also grade the product, the way canned peaches are grade
labelled A, B, and C. The label might describe the product: who made
it, where it was made, when it was made, what it contains, how it is to
be used, and how to use it safely. Finally, the label might promote the
product through attractive graphics.
Labels eventually become outmoded and need freshening up. The
label on Ivory soap has been redone 18 times since the 1890s, with
gradual changes in the size and design of the letters. The label on
Orange Crush soft drink was substantially changed when competitors’
labels began to picture fresh fruits, thereby pulling in more sales. In
response, Orange Crush developed a label with new symbols to
suggest freshness and with much stronger and deeper colours.
Legal concerns about labels and packaging stretch back to the early
1900s and continue today. The Food and Drug Administration (FDA)
recently took action against the potentially misleading use of such
descriptions as “light,” “high beer,” and “low fat.” Meanwhile,
consumerists are lobbying for additional labelling laws to require open
dating (to describe product freshness), unit pricing (to state the
product cost in standard measurement units), grade labelling (to rate
the quality level), and percentage labelling (to show the percentage of
each important ingredient). Some tangible products that incorporate
packaging and labels also involve some service component, such as
delivery or installation. Therefore, marketers must be skilful not only in
managing product lines and brands, but also in designing and
managing services.

LEARNING
When people act, they learn. Learning involves changes in an
individual’s behaviour that arise from experience. Most human
behavior is learned. Theorists believe that learning is produced
through the interplay of drives, stimuli, cues, responses, and
reinforcement. A drive is a strong internal stimulus that impels action.
Cues are minor stimuli that determine when, where, and how a person
responds.
Suppose you buy an IBM computer. If your experience is rewarding,
your response to computers and IBM will be positively reinforced.
Later, when you want to buy a printer, you may assume that because
IBM makes good computers, it also makes good printers. You have now
generalized your response to similar stimuli. A countertendency to
generalization is discrimination, in which the person learns to
recognize differences in sets of similar stimuli and adjust responses
accordingly. Applying learning theory, marketers can build up demand
for a product by associating it with strong drives, using motivating
cues, and providing positive reinforcement.

LEARNING INTERNET PURCHASING

Internet purchasing. By 2003, business-to-business buying on the
Internet is projected to reach $1 trillion per year (compared with a
projected $108 billion for consumer buying).
The move to Internet purchasing has dramatic and far-reaching
implications. Companies are not only posting their own Web pages to
sell to business buyers, they are establishing Intranets for internal
communication and extranets to link with regular suppliers and
distributors. So far, most businesses are using extranets to buy MRO
supplies. However, a growing number, such as General Electric, are
preparing to buy nearly all supplies on-line to shave transaction and
personnel costs, reduce time between order and delivery, and
consolidate purchasing. In fact, GE Information Services is a leader in
helping GE internal business units and outside companies use the
Internet to buy from and sell to other businesses; its Trading Process
Network lets companies buy raw materials, components, and just
about anything else with a few clicks of the mouse. Internet
purchasing can help forge closer relations between partners and
buyers, and it levels the playing field between large and small
suppliers. At the same time, it can potentially erode supplier-buyer
loyalty and open the door to possible security disasters.

LIFESTYLE
Lifestyle is a term to describe the way a person lives, which was
originally coined by Austrian psychologist Alfred Adler in 1929. The
current broader sense of the word dates from 1961.[1] A set of
behaviours, and the senses of self and belonging which these
behaviours represent, are collectively used to define a given lifestyle.
The term is defined more broadly when used in politics, marketing,
and publishing.
A lifestyle is a characteristic bundle of behaviours that makes sense to
both others and oneself in a given time and place, including social
relations, consumption, entertainment, and dress. The behaviours and
practices within lifestyles are a mixture of habits, conventional ways of
doing things, and reasoned actions.
A lifestyle typically also reflects an individual's attitudes, values or
worldview. Therefore, a lifestyle is a means of forging a sense of self
and to create cultural symbols that resonate with personal identity.
Not all aspects of a lifestyle are entirely voluntaristic. Surrounding
social and technical systems can constrain the lifestyle choices
available to the individual and the symbols she/he is able to project to
others and the self.
The lines between personal identity and the everyday doings that
signal a particular lifestyle become blurred in modern society.[3] For
example, "green lifestyle" means holding beliefs and engaging in
activities that consume fewer resources and produce less harmful
waste (i.e. a smaller carbon footprint), and deriving a sense of self
from holding these beliefs and engaging in these activities. Some
commentators argue that, in modernity, the cornerstone of lifestyle
construction is consumption behaviour, which offers the possibility to
create and further individualize the self with different products or
services that signal different ways of life.
In business, "lifestyles" provide a means by which advertisers and
marketers endeavour to target and match consumer aspirations with
products, or to create aspirations relevant to new products. Therefore
marketers take the patterns of belief and action characteristic of
lifestyles and direct them toward expenditure and consumption. These
patterns reflect the demographic factors (the habits, attitudes, tastes,
moral standards, economic levels and so on) that define a group. As a
construct that directs people to interact with their worlds as
consumers, lifestyles are subject to change by the demands of
marketing and technological innovation.
In the magazine and television industries, "lifestyle" is used to describe
a category of publications or programs.
LINE FILLING
Maruti Suzuki is following the product line strategy of Line Filling. Line
Filling is a strategy where the company introduces new products within
the same (existing) price range.
Maruti Suzuki recently launched a series of brands in the hatchback
segment. A look at the price ranges of hatchback brands of Maruti will
give you a clear picture of Line Filling.
Example:
Maruti 800 - Rs 2,00,000 - Rs 2,12000
Maruti Alto - Rs 2,22,000 - Rs 2,70,000
Maruti Estilo - Rs 3,17,000 - Rs 3,98,000
Maruti Wagon R - Rs 3,18,000 - Rs 4,32,000
Maruti A Star - Rs 3,40,000 - Rs 4,12,000
Maruti Ritz - Rs 3,89,000 - Rs 5,10,000
Maruti Swift - Rs 4,06,000 - Rs 5,20,000
From the price ranges, it is evident that there is a significant overlap
among various brands.The question is why Maruti chose to bring out
products with similar price ranges. Another question is whether this
overlap will create cannibalization among these brands.
There are several reasons for such a line filling strategy. According to
Prof. Philip Kotler, firms adopt this strategy for
a. Incremental Profits
b.Satisfy Dealers who complain about lost sales because of missing
items in the line
c.Utilize existing capacity
d.Try to become a full-line company
e.Try to plug holes to keep the competitors away.
In the case of Maruti, more than one reasons prompt it to fill the line.
Maruti Suzuki has tremendous brand equity in the Indian market.
Hence having a full line catering to all segments of consumers offers
tremendous advantage to the company.
There are customers (like me) who would like to buy a car from Maruti.
Having various offerings at various price points keeps that customers
happy and make them stick to the company. If I want to upgrade to a
bigger car, I have a choice or a A star or a Wagon R or a Ritz or a Swift.
In such a scenario, I may not go in to a competitor's product.
Another reason for Maruti's line filling is to keep out the competitors.
The company is facing lot of competition in the hatchback segment. At
the lower end Nano may give Alto and 800 a run for its money. Santro,
i10 and Spark is giving tough competition for mid-range hatchbacks
and products like Fabia, Palio,Punto,i20 are giving competition at the
higher segment of the hatchback market. Hence to keep the market
share intact , Maruti is keeping a full line of brands covering various
price points.
When there are brands which has similar price points, it is natural that
some sort of cannibalization will happen. When Ritz was launched, it
definitely took away some customers of Swift. But Maruti can be happy
that the customer has bought its product rather than that of its
competitor.
Regarding the profits, Maruti is one of the lowest cost producer in the
automobile industry. This low cost base enable the firm to make a
profit irrespective of cannibalization.
One of the critical factor that a firm should consider while line filling is
the Differentiation. There has to be a just-noticable difference between
the offerings other wise consumers will get confused . In the case of
Maruti brands, there is a clear differentiation either interms of design
or performance between these brands.
Line Filling is the strategy adopted by Maruti Suzuki to retain its grip in
the Indian market. But in the Indian Automobile industry , may be only
Maruti can do it.

LINE EXTENSION
A product line extension is the use of an established product’s brand
name for a new item in the same product category.
Line Extensions occur when a company introduces additional items in
the same product category under the same brand name such as new
flavors, forms, colors, added ingredients, package sizes. This is as
opposed to brand extension which is a new product in a totally
different product category.Line extension occurs when the company
lengthens its product line beyond its current range. The company can
extend its product line down-market stretch, up-market stretch, or
both ways.
Down-Market Stretch
A company positioned in the middle market may want to introduce a
lower-priced line for any of the three reasons:
1. The company may notice strong growth opportunities as mass
retailers such as Wal-Mart, Best Buy, and others attract a growing
number of shoppers who want value-priced goods.
2. The company may wish to tie up lower-end competitors who might
otherwise try to move up-market. If the company has been attacked
by a low-end competitor, it often decides to counterattack by entering
the low end of the market.
3. The company may find that the middle market is stagnating or
declining.
Up-Market Stretch
Companies may wish to enter the high end of the market for more
growth, higher margins, or simply to position themselves as full-line
manufacturers. Many markets have spawned surprising upscale
segments: Starbucks in coffee, Haagen-Dazs in ice cream and Evian in
bottled water. Leading Japanese auto companies have each introduced
an upscale automobile: Toyota's Lexus, Nissan's Infiniti, and Honda's
Acura. Note that they invented entirely new names rather than using
or including their own names.
Two-Way Stretch
Companies serving the middle market might decide to stretch their
line in both directions. Texas Instruments (TI) introduced its first
calculators in the medium-price-medium-quality end of the market.
Gradually, it added calculators at the lower end taking the share from
Bowmar, and at the higher end to compete with Hewlett-Packard. This
two-way stretch won Texas Instruments (TI) an early market leadership
in the hand-calculator market.
Examples include
Zen LXI, Zen VXI,Surf, Surf Excel, Surf Excel Blue,Splendour, Splendour
Plus
Coca-Cola, Diet Coke, Vanilla Coke,Clinic All Clear, Clinic Plus
Reese's Peanut Butter Cups, Reese's Pieces and Reese's Puff Cereal

MACRO MARKETING ENVIRONMENT

An organization's macro environment consists of nonspecific aspects
in the organization's surroundings that have the potential to affect the
organization's strategies. When compared to a firm's task
environment, the impact of macro environmental variables is less
direct and the organization has a more limited impact on these
elements of the environment. It includes factors such as demography,
economy, natural forces, technology, politics, and socio-culture.
DEMOGRAPHIC FACTORS: It refers to studying human populations in
terms of size, density, location, age, gender, race, and occupation. This
is a very important factor to study for marketers and helps to divide
the population into market segments and target markets.

Example:
• Volkswagen sales in the United States rose from under 50,000
cars in 1993 to over 300,000 a decade later partly as a result of a
"Drivers Wanted" ad campaign that targeted fun-loving or youthful
drivers. Rather than appealing to the mass market, VW went after a
younger demographic willing to spend a little extra on a Volkswagen
because of the car's German engineering, sportier image, and
versatility. The voiceover on the introductory TV spot identifies the
target audience by saying, "On the road of life, there are passengers
and there are drivers."
• Children are not allowed in France to work in ads
• In country like Japan where average age on higher side products
like insurance pertaining to pension, retirement benefits are in high
demand, where as in country like India where major age group is
young child care policies .
• As in India no of working women increasing day by day so the
products like fast food, ready to eat meals, women formal apparels are
in high demand.
• As concept of nuclear families increasing, consumer goods
companies like LG see potential for growth.

COMPETITIVE FACTORS: It is a crucial factor where the company does

its share of research on the product already available in the market
before launching its product. No company enters market without
competition.
Example:
Himani Boro plus entered the market when Boroline could not fulfil the
demand of the market.

TECHNO-LEGAL FACTOR: The techno-legal environment is perhaps one

of the fastest changing factors in the macro environment. This includes
all developments from antibiotics and surgery to nuclear missiles and
chemical weapons to automobiles and credit cards. As these markets
develop it can create new markets and new uses for products. It also
requires a company to stay ahead of others and update their own
technology as it becomes outdated.
Example:
• In an ambitious endeavour, Samsung had launched a digital
home business. In Korea, Samsung has 6,000 networked homes that
are outfitted with Internet-enabled ovens, refrigerators, security
cameras, and wall-mounted flat-panel displays. Samsung is looking to
take the idea abroad.
• Left hand side –right hand side drivers
• Cdma card used in Japan
• Social security number in USA
• UID no in India
• Blackberry case-messages have to decrypted by government of
India
• Fuel-98-99% octane fuel
• Harley Davidson changed engine in India

Information technology (IT) is "the study, design, development,

application, implementation, support or management of computer-
based information systems, particularly software applications and
computer hardware", according to the Information Technology
Association of America (ITAA).[1] IT deals with the use of electronic
computers and computer software to securely convert, store, protect,
process, transmit, input, output, and retrieve information.
Innovations Innovation can be seen as the process that renews
something that exists and not, as is commonly assumed, the
introduction of something new.
Discovery is the act of detecting something new.
The Internet is a global system of interconnected computer networks
and serves billions of users worldwide. It is a network of networks that
consists of millions of private, public, academic, business, and
government networks, of local to global scope, that are linked by a
broad array of electronic and optical networking technologies.
Rate of Technology transfer - Technology transfer is the process of
sharing of skills, knowledge, technologies, methods of manufacturing,
samples of manufacturing and facilities among governments and other
institutions to ensure that scientific and technological developments
are accessible to a wider range of users who can then further develop
and exploit the technology into new products, processes, applications,
materials or services. It is closely related to (and may arguably be
considered a subset of) knowledge transfer.
Rate of Obsolescence: Obsolescence is the state of a being which
occurs when an object, service or practice is no longer wanted even
though it may still be in good working order. Obsolescence frequently
occurs because a replacement has become available that is superior in
one or more aspects. Obsolete refers to something that is already
disused or discarded, or antiquated. Typically, obsolescence is
preceded by a gradual decline in popularity.

POLITICO-LEGAL: Marketing decisions are strongly affected by

developments in the political and legal environment. This environment
is composed of laws, government agencies, and pressure groups that
influence and limit various organizations and individuals. Sometimes
these laws also create new opportunities for business. For example,
mandatory recycling laws have given the recycling industry a major
boost and spurred the creation of dozens of new companies making
new products from recycled materials.

Example:
• Norway bans several forms of sales promotion—trading stamps,
contests, and premiums— as inappropriate or "unfair" instruments for
promoting products.
• Thailand requires food processors selling national brands to
market low-price brands also, so that low-income consumers can find
economy brands.
• In India we cannot sell electric appliances.
• Danger sign on cigarette packs
• Pricing of medicines is regulated
• Control on petroleum and diesel prices

Taxation policy - Tax policy is the government's approach to taxation.

Policymakers debate the nature of the tax structure they plan to
implement (i.e., how progressive or regressive) and how they might
affect individuals and businesses (i.e., tax incidence).

Labour law (or "labour", or "employment" law) is the body of laws,

administrative rulings, and precedents which address the legal rights
of, and restrictions on, working people and their organizations. As
such, it mediates many aspects of the relationship between trade
unions, employers and employees.
Public policy can be generally defined as the course of action (or
inaction) taken by the state with regard to a particular issue. Other
scholars define it as a system of "courses of action, regulatory
measures, laws, and funding priorities concerning a given topic
promulgated by a governmental entity or its representatives."Public
policy is commonly embodied "in constitutions, legislative acts, and
judicial decisions."

Legislation (or "statutory law") is law which has been promulgated (or
"enacted") by a legislature or other governing body, or the process of
making it. (Another source of law is judge-made law or case law.)
Before an item of legislation becomes law it may be known as a bill,
and may be broadly referred to as "legislation" while it remains under
consideration to distinguish it from other business. Legislation can
have many purposes: to regulate, to authorize, to proscribe, and to
provide (funds), to sanction, to grant, to declare or to restrict.

SOCIO-CULTURAL ENVIRONMENT: Purchasing power is directed toward

certain goods and services and away from others according to people's
tastes and preferences. Society shapes the beliefs, values, and norms
that largely define these tastes and preferences. People absorb,
almost unconsciously, a worldview that defines their relationships to
themselves, to others, to organizations, to society, to nature, and to
the universe.
Examples:
• Colour of products in Islamic country is dominantly green for eg
Colgate, thumbs up.
• McDonald use yellow colour for the face of its mascot Ronald in
south East Asian country and white across the world as white colour
considered as sickness.
• South Asian countries like Thailand uses more vibrant colours as
compared to country like France use subtle shades.
• Phillips launched electric shavers in Japan they failed in
miserably because the size of palm of average Japanese is smaller
than men from other nations.
• HMT, moved to countries like Vietnam and Kenya as they have to
modify the size of tractor because average size of farmer is 5ft and 6ft
respectively.
• Shopping trends of various countries are persuaded by festive
seasons for example in India people tend to shop around dhanteras,
Hyderabad-Bangalore side people shop during ramzan.
Social mobility refers to the degree to which an individual or group's
status is able to change in terms of position in the social hierarchy. To
this extent it most commonly refers to material wealth and the ability
of an agent to move up the class system.
Consumerism is a social and economic order that is based on the
systematic creation and fostering of a desire to purchase goods or
services in ever greater amounts. The term is often associated with
criticisms of consumption starting with Thorsten Veblenor, more
recently by a movement called Enoughism. Veblen's subject of
examination, the newly emergent middle class arising at the turn of
the twentieth century, comes to full fruition by the end of the
twentieth century through the process of globalization.
Lifestyle changes: Adoption of new products especially due to change
in income levels of a household.
Level of Education: Knowledge of products and their availability along
with the know – how of implications of using particular product is
determined by the level of education.
Distribution of Income: Income distribution is how a nation’s total
economy is distributed amongst its population
Economic: Markets require purchasing power as well as people. The
available purchasing power in an economy depends on current
income, prices, savings, debt, and credit availability. Marketers
Markets require purchasing power as well as people. The available
purchasing power in an economy depends on current income, prices,
savings, debt, and credit availability.
Example:
An economic issue of increasing importance was the migration of
manufacturers and service jobs offshore. Outsourcing was seen as a
competitive necessity by many firms, but as a cause of unemployment
by many domestic workers. For example, in December 2003, IBM
decided to move the jobs of nearly 5,000 programmers to India and
China. GE moved much of its research and development overseas.
Microsoft, Dell, American Express.
EXAMPLES
• Pesticides prices are controlled by government so foreign
investor are not able to enter Indian market.
• Petrol and diesel prices are regulated in India
• CRR and SLR ratio fixed by RBI which indirectly affects lending
capacity of banks
• FDI and FII Limits set by government
• During recession, companies had to keep their project on hold as
there was no money in market.
• During 1991, after liberalization of Indian economy lot of foreign
companies entered Indian market.

Inflation is a rise in the general level of prices of goods and services in

an economy over a period of time. When the general price level rises,
each unit of currency buys fewer goods and services. Consequently,
inflation also reflects erosion in the purchasing power of money – a
loss of real value in the internal medium of exchange and unit of
account in the economy.
Disposable income is total personal income minus personal current
taxes. In national accounts definitions, personal income, minus
personal current taxes equals disposable personal income. Subtracting
personal outlays (which includes the major category of personal (or,
private) consumption expenditure) yields personal (or, private)
savings.
Employment is a contract between two parties, one being the
employer and the other being the employee. An employee may be
defined as: "A person in the service of another under any contract of
hire, express or implied, oral or written, where the employer has the
power or right to control and direct the employee in the material
details of how the work is to be performed."
Business cycle (or economic cycle) refers to economy-wide fluctuations
in production or economic activity over several months or years. These
fluctuations occur around a long-term growth trend, and typically
involve shifts over time between periods of relatively rapid economic
growth (expansion or boom), and periods of relative stagnation or
decline (contraction or recession).
Energy availability and cost – This is self explanatory.

MAINTENANCE MARKETING
It is a type of marketing employed in a condition where the industry
has a full demand. That is the demand of the product is equal to the
supply by the industry. The marketers have to maintain everything to
retain their position, as any slight mistake can severely affect the
company’s performance. They have to maintain their:
• Quality
• Production
• Distribution
• Warehouse
• Sales
• Competitors
• Technology
Examples:
• Johnson & Johnson is leaders in child segment since a long time
• Boroline lost its market to boroplus due to lack of maintenance
• Maggi noodles is losing market against Top Ramen gradually due
to reduction in its quality.
• Kissan ketchup has lost the market against Maggi ketchup due to
the same reason

MARKET ANALYSIS
Market analysis is a documented investigation of a market that is used
to inform a firm's planning activities particularly around decisions of
inventory, purchase, work force expansion/contraction, facility
expansion, purchases of capital equipment, promotional activities, and
many other aspects of a company.
Key success factors
The goal of a market analysis is to determine the attractiveness of a
market, both now and in the future. Organizations evaluate the future
attractiveness of a market by gaining an understanding of evolving
opportunities and threats as they relate to that organization's own
strengths and weaknesses.
Organizations use the findings to guide the investment decisions they
make to advance their success. The findings of a market analysis may
motivate an organization to change various aspects of its investment
strategy. Affected areas may include inventory levels,a work force
expansion/contraction, facility expansion, purchases of capital
equipment, and promotional activities.
Market segments
Markets are not uniform. Therefore it is also important for investors to
identify and evaluate the various segments that make up the total
market. This analysis helps organizations determine which areas
account for the greatest share of the market's growth and are more
susceptible to change. This information, in turn, helps them pinpoint
the most promising opportunities within the overall market and guides
the choice of specific investments.
Market profitability
While different organizations in a market will have different levels of
profitability, they are all similar to different market conditions. Michael
Porter devised a useful framework for evaluating the attractiveness of
an industry or market. This framework, known as Porter's five forces,
identifies five factors that influence the market profitability:
Buyer power
Supplier power
Barriers to entry
Threat of substitute products
Rivalry among firms in the industry.

MARKET INTELLIGENCE (MI)

Market intelligence (MI), according to Cornish, “the process of

acquiring and analyzing information in order to understand
the market (both existing and potential customers); to determine the
current and future needs and preferences, attitudes and behaviour of
the market; and to assess changes in the business environment that
may affect the size and nature of the market in the future.”
Market Intelligence is about providing a company with a view of a
market using existing sources of information to understand what is
happening in a market place, what the issues are and what the likely
market potential is.
Market intelligence (MI) is “the process of acquiring and analyzing
information in order to understand the market (both existing and
potential customers); to determine the current and future needs and
preferences, attitudes and behaviour of the market; and to assess
changes in the business environment that may affect the size and
nature of the market in future.”Marketing Intelligence has the capacity
to be at the forefront in contributing to the development of a business
environment through strategic research, risk and policy analysis,
credit-rating documentation, storage, publication, reporting, and
communication of reliable, timely, and objective business information.
It incorporates information from customer analysis and industry
analysis as well as general market conditions.
 In other words, marketing intelligence calls for understanding,
analyzing and assessing the internal and external environment related
to a company’s customers, competitors, markets, and industry to
enhance the decision-making process. This would require the
integration of competitive intelligence, marketing research, market
analysis, and business and financial analysis information.
MI’s main use is to identify successful new product developments early
in the process to create company growth and maximize revenues by
finding a balance between costs and prices of products. By using this
knowledge about the external environment, companies can
successfully innovate to stay ahead of the competition. MI is critical for
helping with the new product development stage of the product
lifecycle, which is crucial for product.
Market Intelligence can be divided into two spheres
• Market Intelligence based on external data
• Market Intelligence based on internal data

Often Market Intelligence relies purely on external data such as

analysts reports, but there is often a great deal of untapped
information internally that would give you an insight into your market,
from sources such as databases and prospect lists, and an holistic view
can prove very insightful.

Internal reporting systems:

All enterprises which have been in operation for any period of

time have a wealth of information. However, this information often
remains under-utilised because it is compartmentalised, either in the
form of an individual entrepreneur or in the functional departments of
larger businesses. That is, information is usually categorised according
to its nature so that there are, for example, financial, production,
manpower, marketing, stockholding and logistical data. Often the
entrepreneur, or various personnel working in the functional
departments holding these pieces of data, does not see how it could
help decision makers in other functional areas. Similarly, decision
makers can fail to appreciate how information from other functional
areas might help them and therefore do not request it.
The internal records that are of immediate value to marketing
decisions are: orders received, stockholdings and sales invoices. These
are but a few of the internal records that can be used by marketing
managers, but even this small set of records is capable of generating a
great deal of information.
MARKET PLACE

A marketplace is the space, actual, virtual or metaphorical, in which a

market operates. The term is also used in a trademark law context to
denote the actual consumer environment, ie. the 'real world' in which
products and services are provided and consumed.

A marketplace is a location where goods and services are exchanged.

The traditional market square is a city square where traders set up
stalls and buyers browse the merchandise.
This kind of market is very old, and countless such markets are still in
operation around the whole world.
• In North America such markets fell out of favour, but renewed
interest in local food has caused the reinvention of this type of market,
called farmers' markets, in many towns and cities.
• In Europe, especially in France and Britain, street markets, as
well as "marketplaces" (covered places where merchants have stalls,
but not entire stores) are commonplace. Both resellers and producers
sell their wares to the public.
• In Australia, the largest "open air" market is the Queen Victoria
Market - at seven hectares (17 acres), in Melbourne, which is also the
largest in the Southern Hemisphere.
• Markets are often temporary, with stalls only present for one or
two days a week ("market days"), however some (such as Camden
Market in London, UK) are open every day of the week. Such markets
are normally specialist—the various stalls of Camden Market, along
with the shops associated with it, sell a variety of alternative lifestyle
products ranging from clothes and jewellery to CDs, instruments and
furniture. An example of a large market is Chatuchak weekend market
in Bangkok.
• Some large markets have become permanent institutions
comparable to shopping malls. One example is the huge Seventh-
Kilometer Market near Odessa, Ukraine.
The Roman term for market, still in use in a related sense, is forum.
The modern shopping mall can be seen as an extension of this
concept.

MARKETING ENVIRONMENT:
The various external forces that can directly or indirectly affect the
many activities of an organization. This is an integral part of
environmental scanning. These activities include acquisition of human
resources, raw materials, financial resources, and development of
goods and services. The marketing environment includes forces such
as: political, legal, regulatory, economic, social, technological, and
competitive.
The term marketing environment is set of forces/factors that have
potential to influence the marketing decisions of any company.
These factors have to be taken into consideration by the marketer and
proper steps should be taken to adapt to the conditions.
The factors which affect the decisions may be demographic, legal,
social, cultural etc.
Examples:
• Yamaha launched a prototype of YAMAHA FZ1 in India to adapt
to the Indian Environment
• Youth is of high population in India, therefore Pepsi has focussed
the youth market in India, “YOUNGISTAN”
• Mc. Donalds introduced Mc Veggie and Mc. Tikka when they
entered India.
• Head and shoulders is costlier in country like USA due its better
quality like high viscousity. On the contrary it is lower in price in
India to match the economy.

• Volkswagen sales in the United States rose from under 50,000

cars in 1993 to over 300,000 a decade later partly as a result of
a "Drivers Wanted" ad campaign that targeted fun-loving or
youthful drivers. Rather than appealing to the mass market,
VW went after a younger demographic willing to spend a little
extra on a Volkswagen because of the car's German
engineering, sportier image, and versatility. The voiceover on
the introductory TV spot identifies the target audience by
saying, "On the road of life, there are passengers and there are
drivers."

• Children are not allowed in France to work in ads

• In country like Japan where average age on higher side

products like insurance pertaining to pension, retirement
benefits are in high demand, where as in country like India
where major age group is young child care policies .
MARKETING GOAL:

It is the collection of various quantitative marketing targets that

form a goal.

Marketing goals are objectives that are specific with respect to

magnitude and time i.e. they usually quantify the objectives.

EXAMPLES:

a. HUL goal –To develop new ways of doing business with the
aim of doubling the size of the company while reducing
environmental impact.

b. Colgate – Palmolive – It is deeply committed to advancing

technology which can address changing consumer needs
throughout the world. The goal is to use its technology to
create products that will continue to improve the quality of
life for consumers wherever they live.

c. The goal of Nokia is to seize a 10% increase in market share

in the low cost variety of mobiles.
d. The goal of Raymonds is to expand the capacity, and
distribution of clothing brands in Tier IV and V cities.
e. The goal of Haldirams is to target places like Jordan, Algeria,
Yemen, etc.

MARKETING INFORMATION SYSTEM:

A Marketing Information System can be defined as 'a system in

which marketing information is formally gathered, stored, analysed
and distributed to managers in accordance with their informational
needs on a regular basis.
It is a set of procedures and practices employed in analyzing and
assessing marketing information, gathered continuously
from sources inside and outside of a firm.
Timely marketing information provides basis for decisions such
as productdevelopment or improvement, pricing, packaging, distributio
n, media selection, and promotion.
 A Marketing Information System can be defined as ‘a system in
which marketing information is formally gathered, stored, analysed
and distributed to managers in accordance with their informational
needs on a regular basis’.

A system that is created through an understanding of the

information needs of marketing management is called marketing
information system.

A system that supply information to mangers of when, where

and how the marketing mangement is to be done.Data is taken from
the marketing environment and transferred into the information that
marketing managers can use in their decision-making processes.

A marketing information system (MIS)consists of people, equipment

and procedures to gather, sort, analyze, evaluate and distribute
needed, timely and accurate information to marketing decision
makers.

An 'MIS' is a planned system of the collection, processing,

storage and dissemination of data in the form of information needed to
carry out the management functions.

Examples:
• Shoppers Stop offers shoppers a free membership card when
they make their first purchase at their store. The card entitles
shoppers to discounts on selected items, but also provides
valuable information to the chain.
• Maruti uses its internal reporting system like customer feedback
and decide about re-launching the products

MARKETING MIX
Set of marketing tools that are used to develop integration / fit with
the emerging marketing opportunities.
Marketing mix is a combination of marketing tools that are used to
satisfy customers and company objectives.
A combination of the controllable components of a marketing
strategy: product, price, place and promotion. Public image may
also be considered a controllable part of the marketing strategy.
 Marketing mix is the combination of elements that we will use to
market your product. There are four elements: Product, Place, Price
and Promotion. They are called the four Ps of the marketing.
Product: What your product offers that your customers value, and
whether/how you should change your product to meet customer
needs.

Pricing: For example, you might aim simply to match the

competition, or charge a premium price for a quality product and
service. You might have to choose either to make relatively few
high margin sales, or sell more but with lower unit profits.

Place: How and where you sell. This may include using different
distribution channels. For example, you might sell over the Internet
or sell through retailers.

Promotion: How you reach your customers and potential

customer. For example, you might use advertising, PR, direct mail
and personal selling.
It is concept of filling the gap between opportunity and the
objectives to be achieved.
Market is a place of bundle of expectation and we can fill this gap
with the help of product, the concept of filling this gap is called
marketing mix.
EXAMPLE:
LML and BAJAJ scooters lost because they were unable to fill this
gap by morph marketing.
LG gained the market by morph marketing.
Discounts and offers on various products.
Parachute coconut oil with double lid.

MARKETING MODEL
It is an overview of the entire marketing process which can be shown
graphically, often using a computer, and used to solve problems
Graphical representations of a process designed to aid in
understanding and for forecasting.
Marketing models are computerised models that allow simulation of
scenarios based on different assumptions about changes to the macro
environment and micro environment.

MARKETING OBJECTIVE:
It is the collection of various processes that define the essence of the
marketing plan, which will include the mission statement and
corporate, financial, marketing, and long term objectives which fits the
basic business philosophy of the company.

Marketing Objectives means is trying to achieve through

its marketing activities during a specified period; closely linked
with corporate objectives. An objective is essentially a qualitative
statement regarding company’s leadership, value/volume, market
share, market scatter, product launches et al.
Examples:
Vodafone UK Marketing objectives: To become a global mobile leader
in terms of profit, customers and value, making mobile networks the
“nervous system” of the networked economy spanning three major
developed markets (Europe, US and Japan)
HUL objective
To help people feel good, look good and get more out of life with
brands and services that are good for them and good for others.
(emphasis on expanding the company size via launching various
products)

Colgate – Palmolive
Focuses on achieving the consistent growth required to continue the
global success and to make it an even stronger company. It believes
this is the best way to benefit its consumers, people and shareholders.

The objective of Nokia is to revive their marketing demand to

recapture market share in the cell phone industry.

The objective of Asian Paints is to be the 5th largest decorative paints

in the world from the 10th position.

The objective of Raymonds is to enter and be the leader in every

clothing segment in the Indian market.

MARKETING PLAN:
It is steps or procedure taken by a marketer or a company to achieve
certain policies, goals etc. It includes elements like deciding marketing
policies, marketing goals, strategies, programs etc.
A marketing plan is a written document that details the necessary
actions to achieve one or more marketing objectives. It can be for a
product or service, a brand, or a product line. Marketing plans cover
between one and five years.
 A marketing plan may be part of an overall business plan.
Solid marketing strategy is the foundation of a well-written marketing
plan.
A marketing plan contains a list of actions and a sound strategic
foundation.
Examples:
• Marketing plan of Maruti Suzuki includes-
○ To be India’s no.1 automobile industry
○ To keep safety as its top priority while manufacturing the
cars
• Hyundai- Lunch of Hyundai Pa will bridge the gap between
Santro and Getz, giving customers moreoptions within the
Hyundai family

• Toyota plans to increase its dealership from 97 to 150

• DTH major Dish TV aims to add 3 million subscribers this fiscal to
take its subscriber base to 10 million by March 2011
• YAMAHA will focus on the 150cc+ segment to achieve a target of
25 % share by the end of year.
• Honda priced its products 41% higher than the cheapest make in
philipines.
MARKETING RESEARCH SYSTEMS:

Marketing research is a proactive search for information. That is,

the enterprise which commissions these studies does so to solve a
perceived marketing problem.

Marketing research can be seen as the systematic and objective

search for and analysis of (data and) Information relevant to the
identification and solution of any problem in the field of marketing.

Marketing research is fundamentally about the acquisition and analysis

of information required for the making of marketing decision.

Market research Information means finding out whom the customer is,
and what he/she will buy.

Market research information means to enable design a product in

accordance with customers' preference, to manufacture it in quantities
that can be sold to pack it suitably, making appropriate arrangements
for effective, advertising and distribution. In this ideal case, over -
production and losses in tying of unsaleable stock will not occur.

Examples:
Consumer marketing research
Business-to-business (B2B) marketing research.

MARKETING STRATEGY

Marketing strategy is the direction and scope of an organization over

the long-term: which achieves advantage for the organization through
its configuration of resources within a challenging environment, to
meet the needs of markets and to fulfil stakeholder expectations.
Marketing strategy are the decisions taken by an industry to achieve
its goals, objectives etc. The main difference of strategy from policy is
that strategy is a decision making under constraints.
Activities associated with deciding whether to build, hold, or harvest
market share and related decisions about positioning your products’
performance and whether to price for margin or growth. Pricing above
your product’s fair price will typically lead to market-share loss. Pricing
on or near the best-value frontier will typically lead to market-share
gain. Changing performance opens up many other options for
changing market share.
Marketing strategy is the direction and scope of an organisation over
the long-term: which achieves advantage for the organisation through
its configuration of resources within a challenging environment, to
meet the needs of markets and to fulfil stakeholder expectations

Example:
• The market strategy for YAMAHA in the year 2010 was to revolve
around the campaign “YES! YAMAHA”
• Reymonds is planning to open 100 retail stores through its
franchisee network in tier 4 & 5 cities in 2010.

MASS CUSTOMISATION:
Mass customization is the ability to prepare on a mass basis,
individually designed products and communications to meet each
customer’s requirements.
Mass Customisation is the customisation and personalisation of
products and services for individual customers at a mass production
price. Traditionally customisation and low cost have been mutually
exclusive. Mass production provided low cost but at the expense of
uniformity. Customisation was the product of designers and craftsman.
Its expense generally made it the preserve of the rich. To-day, new
interactive technologies, like the Internet, allow customers to interact
with a company and specify their unique requirements which are then
manufactured by automated systems.
EXAMPLE:
1. Levi’s Personal Pants
2. National Bicycle Company

MEGA MARKETING:
Use of power to market your product.
Management activity that involves (in addition to the typical marketing
activities) other elements of a firm's external environment such as
government, media, and pressure groups.
Mega marketing is defined as the strategic co-ordination of economic,
psychological, political and public relations skills to gain the co-
operation of a number of parties in order to enter or operate in a given
market.

EXAMPLE:
1) Cable Operators cutting wires
2) Pepsi entering India
3) Dainik Bhaskar using against Rajasthan Patrika
4) Pepsi was removed from Indian Railways by Coca Cola
5) Ashok Leyland accused Tata Motors

MEGATRENDS:
Megatrends have been described as "large social, economic, political
and technological changes that are slow to form, and once in place,
they influence us for some time— between seven and ten years, or
longer." Young people in the region are playing an increasingly
significant role in the consumption of products and services.
For example: due to the boom in the information technology sector in
India, a large number of people are joining the workforce. As a result
their purchasing power is increasing and they are becoming an
important consumption group. The role of the youth in consuming
products and services as well as in influencing family consumption
decisions is undergoing a perceptible metamorphosis.

META MARKETING
Meta marketing is using a combination of two or more marketing
variables for marketing.
Meta marketing means use of more than one ‘P’. Where ‘P’ stands for
product, price, place, promotion.

EXAMPLE:
a) Buy 1 get 1 free
b) 20% discount

MICRO ENVIRONMENTAL
The microenvironment consists of various components. The first is the
organization’s internal environment—its several departments and
management levels—as it affects marketing management's decision
making. The second component includes the marketing channel firms
that cooperate to create value: the suppliers and marketing
intermediaries (middlemen, physical distribution firms, marketing-
service agencies, financial intermediaries). The third component
consists of the five types of markets in which the organization can sell:
the consumer, producer, reseller, government, and international
markets.
The Company’s Microenvironment
Microenvironment consists of six forces that affect its ability to serve
its customers. Let’s discuss these forces in detail:

a. The Company
The first force is the company itself and the role it plays in the
microenvironment. This could be deemed the internal environment.
1). Top management is responsible for setting the company’s mission,
objectives, broad strategies, and policies.
2). Marketing managers must make decisions within the parameters
established by top management.
3). Marketing managers must also work closely with other company
departments. Areas such as finance, R & D, purchasing,
manufacturing, and accounting all produce better results when aligned
by common objectives and goals.
4). All departments must “think consumer” if the firm is to be
successful. The goal is to provide superior customer value and
satisfaction.
b. Suppliers
Suppliers are firms and individuals that provide the resources needed
by the company and its competitors to produce goods and services.
They are an important link in the company’s overall customer “value
delivery system.”
1) One consideration is to watch supply availability (such as supply
shortages).
2) Another point of concern is the monitoring of price trends of key
inputs. Rising supply costs must be carefully monitored.
c. Marketing Intermediaries
Marketing intermediaries are firms that help the company to promote,
sell, and distribute its goods to final buyers.
1) Resellers are distribution channel firms that help the company find
customers or make sales to them.
2) These include wholesalers and retailers who buy and resell
merchandise.
3) Resellers often perform important functions more cheaply than the
company can perform itself. However, seeking and working with
resellers is not easy because of the power that some demand and use.
Physical distribution firms help the company to stock and move
goods from their points of origin to their destinations. Examples would
be warehouses (that store and protect goods before they move to the
next destination).
Marketing service agencies (such as marketing research firms,
advertising agencies, media firms, etc.) help the company target and
promote its products.
Financial intermediaries (such as banks, credit companies,
insurance companies, etc.) help finance transactions and insure
against risks.
d. Customers
The company must study its customer markets closely since each
market has its own special characteristics. These markets normally
include:
1). Consumer markets (individuals and households that buy goods
and services for personal consumption).
2). Business markets (buy goods and services for further processing
or for use in their production process).
3). Reseller markets (buy goods and services in order to resell them
at a profit).
4). Government markets (agencies that buy goods and services in
order to produce public services or transfer them to those that need
them).
5). International markets (buyers of all types in foreign countries).

e. Competitors
Every company faces a wide range of competitors. A company must
secure a strategic advantage over competitors by positioning their
offerings to be successful in the marketplace. No single competitive
strategy is best for all companies.
f. Public
A public is any group that has an actual or potential interest in or
impact on an organization’s ability to achieve its objectives. A
company should prepare a marketing plan for all of their major publics
as well as their customer markets. Generally, publics can be identified
as being:
1) Financial publics--influence the company’s ability to obtain funds.
2) Media publics--carry news, features, and editorial opinion.
3) Government publics--take developments into account.
4) Citizen-action publics--a company’s decisions are often questioned
by consumer organizations.
5) Local publics--includes neighbourhood residents and community
organizations.
6) General publics-a company must be concerned about the general
public’s attitude toward its products and services.
7) Internal publics--workers, managers, volunteers, and the board of
directors.

MICRO MARKETING:
It involves targeting potential customers at a very basic level, such as
by ZIP code, specific occupation, lifestyle, or individual household. The
Internet may allow marketers to make micromarketing even more
effective.
Designing, creating, and manufacturing products, marketing
strategies, and advertising campaigns for the benefit of very specific
geographic, demographic, or psychographic segments of the consumer
market.
Micromarketing is a relatively new marketing trend created by the
diversity of the consumer population and the difficulty in creating a
single product that appeals to all the diverse groups in the population.
Alternative term for niche marketing.
Micro-marketing is the performance of activities that collectively seek
to accomplish a company’s objectives by anticipating customer needs
and directing a flow of need-satisfying goods and services from
producer to customer.

MIND SHARE:
Mind share or the development of consumer awareness or popularity,
is one of the main objectives of advertising and promotion. When
people think of examples of a product type or category, they usually
think of a limited number of brand names.
Examples-
a) The term googling describing the act of online searching.

b) Very few people realize that "Band-Aid" is a specific brand of

first-aid adhesive bandage, and they refer to all such items by
that name even if it is a different brand.

c) Xerox is often used in case of copying.

MORPH MARKETING:

DEFINITIONS-
➢ It is a strategy in which marketer provides a product
with an envelope of service---wiki.answers.com
➢ Morph marketing is a marketing as per the changing
requirements of the customers.
 ➢ It is also known as PACE MARKETING as it provides pace
to the business.

EXAMPLES-
➢ LG Provides a replacement T.V when your faulty T.V is
taken out for service.
➢ Mercedez BENZ provides instant service for your car , if
default is incurable , they also provide a new car as a
replacement.
➢ Nokia mobiles provides new battery as a replacement
for the faulty BL5-C battery.
➢ Various car companies take all their car’s models back
if they found that some fault had occurred in their cars
somewhere as a safety precaution.

MOST VALUABLE CUSTOMERS:

DEFINITIONS:
➢ Customers, or customer segments, providing the largest
stream of profits over the relevant time horizon. Marketers
target customers that can provide the greatest discounted
present value of future profits.
➢ These customers are the real assests of the company.
➢ Most valuable customer can be a single customer as well as
an organization that provides maximum profit.
EXAMPLES:
➢ GENERAL ELECTRIC is the most valuable customer for IT
GAINT BIRLASOFT(60%projects that birlasoft handles
comes from GE.

➢ For sleepers manufactures, it is INDIAN RAILWAYS.

➢ FOR DETERGENTS LIKE NIRMA AND GHARI it is the rural

market .

MOTIVATION:
 DEFINITIONS

➢ Motivation is the driving force which causes us to achieve

goals. Motivation is said to be intrinsic or extrinsic. The term
is generally used for humans but, theoretically, it can also be
used to describe the causes for animal behavior as well.

➢ According to various theories, motivation may be rooted in

the basic need to minimize physical pain and maximize
pleasure, or it may include specific needs such as eating and
resting, or a desired object, goal, state of being, ideal, or it
may be attributed to less-apparent reasons such
as altruism, selfishness, morality, or avoiding mortality.

➢ Conceptually, motivation should not be confused with

either volition or optimism.
➢ Motivation is related to, but distinct from, emotion.
EXAMPLES:
➢ MASLOWS HIERARCHIAL theory of motivation that caters
physiological , safety ,social, esteem ,self-actualization needs in
a hierarchial order.
➢ Theory X and theory Y(DOUGLAS THEORY)
➢ HERGBERG’S TWO FACTOR THEORY
➢ EQUITY THEORY
➢ ERG-THEORY

MULTIBRAND STRATEGY /MULTIPLE BRANDING

DEFINITION:
➢ Marketing of two or more mutually competing products under
different brand names by the same company. The motive may
be that the company wishes to create internal competition to
promote efficiency, or to differentiate its offering to different
market segments, or to get maximum mileage out of established
brands that it has acquired.
➢ When a company has achieved a dominant market share,
multibrand strategy may be its only option for increasing sales
still further without sacrificing profitability.

Examples:
➢ Lever Brothers sells washing powders under the Persil,
Omo and Surf names.
 ➢ Cadbury sells chocolates under the Dairy Milk, Bournville
and Fruit & Nut names.
➢ Heinz sells canned convenience foods under the Baked
Beans, Spaghetti Hoops and Alphabetti Spaghetti names.
➢ GITANJALI GROUP have following brands under its name-
Nakshatra , D’damas , Diya ,Stefan Hafner.

MULTICHANNEL MARKETING-

DEFINITIONS-
➢ A system in which a producer uses more that one channel of
distribution; commonly, producers who use multichannel
marketing systems operate their own retail stores as well as
sell through other wholesalers and retailers. Multichannel
retailers are also called Merchandising Conglomerates.---
monash dictionary of marketing

➢ Multichannel marketing is marketing using many

different marketing channels to reach a customer. In this
sense, a channel might be a retail store, a web site, a mail
order catalogue, or direct personal communications
by letter, email or text message. The objective of the
company doing the marketing is to make it easy for a
consumer to buy from them in whatever way is most
appropriate.

➢ To be effective multichannel marketing needs to be

supported by good supply chain management systems, so
that the details and prices of goods on offer are consistent
across the different channels. It might also be supported by
detailed analysis of the return on investment from each
different channel, measured in terms of customer response
and conversion of sales. Some companies target certain
channels at different demographic segments of the market or
at different socio-economic groups of consumers.
 ➢ MultiChannel marketing allows the retail merchant to reach
its prospective or current customer in a channel of his/ her
liking.------------- -wikipedia.

EXAMPLES:

➢ Mobile companies like nokia sells their mobiles using their

own stores PRIORITY,retail outlels like BIG-
BAZZAR,SHOPPER’S STOP,and through others means like
HOTSPOT and interet(E-COMMERCE).

➢ AIRLINES sells their tickets by their websites,offices and

through other sites like YATRA.COM,MAKE MY TRIP.COM.

➢ Railways also sells their tickets through their reservation

counters,IRCTC website and other registered agents.

MULTIDIMENSIONAL SCALING:

DEFINITIONS:
➢ Multidimensional scaling (MDS) is a set of
related statistical techniques often used in information
visualization for exploring similarities or dissimilarities in data.
➢ MDS is a special case of ordination. An MDS algorithm starts
with a matrix of item–item similarities, then assigns a location
to each item in N-dimensional space, where N is specified a
priori. For sufficiently small N, the resulting locations may be
displayed in a graph or 3D visualisation.—(Wikipedia)

TYPES OF MULTIDIMENSIONAL SCALING:

MDS algorithms fall into a taxonomy, depending on the
meaning of the input matrix:

➢ Classical multidimensional scaling

 also known as Torgerson Scaling or Torgerson-Gower scaling –
takes an input matrix giving dissimilarities between pairs of
items and outputs a coordinate matrix whose configuration
minimizes a loss function called strain.

➢ Metric multidimensional scaling

A superset of classical MDS that generalizes the optimization
procedure to a variety of loss functions and input matrices of
known distances with weights and so on. A useful loss function in
this context is called stress which is often minimized using a
procedure called Stress Majorization.

➢ Non-metric multidimensional scaling

In contrast to metric MDS, non-metric MDS both finds a non-
parametric monotonic relationship between the dissimilarities in
the item-item matrix and the Euclidean distance between items,
and the location of each item in the low-dimensional space. The
relationship is typically found using isotonic regression.
➢ Louis Guttman's smallest space analysis (SSA) is an
example of a non-metric MDS procedure.

NEED:

DEFINITIONS:
➢ Needs are the basic human requirements. Need means a “felt
state” or a sense of deprival. Need is a negative word.(google)
➢ Problems that customers intend to solve with the purchase of a
good or service. And the marketers’ job is to identify the
customer wants to develop a product or service specific to
customer need.(google)

EXAMPLES:

➢ Ujala Supreme was a product made to suit customer needs

for whiter clothes.
 ➢ Fair and Handsome was a product as a fairness cream specific
for men.
➢ Air conditioners were not needed in cars in European
countries, hence Maruti refitted cars with heaters.

NEED BASED SEGMENTATION:

DEFINITIONS:
➢ Group consumers into segments based on similar needs and
benefits.
➢ Each segment is satisfied by same kind of products and offer.
➢ Widely used concept helps marketers to design their strategy
and saves promotional and advertizing costs.

EXAMPLES:
➢ HERO HONDA SHINE was specifically lauched for girls to realize
that “why should boya have all the fun?”
➢ Mercedez benz caters to high rich class people for whom status
matter more than money.
➢ Ghari detergent and nirma generally caters to the need of rural
population.
➢ TATA MOTORS launched NANO to caters to the need of middle
class as a replacement of two-wheeler.

NEUTRAL PRICE:
DEFINITIONS:
➢ The price for a product at which its market share will hold at
the current level.
➢ Setting a price above the neutral price is a tactic for
increasing unit profit margin, at the expense of causing
market-share erosion; setting price below the neutral price is
a tactic for gaining share.
EXAMPLES:
➢ During shortage price of vegetables and other essential items,
their prices increases ato a great extent(much more than the
neutral price)
➢ Sometimes companies reduces their product prices to gain
market share.
➢ TATA DOCOMO introduces 1 PAISA/SEC .
NEURO MARKETING:
DEFINITIONS:
➢ The term neuromarketing has been used to describe brain
research on the effect of marketing stimuli. By adding
neurological techniques o their research arsenal , marketers
are trying to move toward a more complete picture of what
goes on inside consumers’ heads. Given the complexity of the
human brain, however many researchers caution that
neurological research should not form the sole basis of
marketing decisions. these research activities have not been
universally applauded though. Critics thinks that such a
development will only lead to more marketing manipulation
by companies.----(MARKETING MANEGEMENT BY KOTLER)

NICHE MARKETING:
DEFINITIONS:

➢ A niche market is the subset of the market on which a

specific product is focusing; therefore the market niche
defines the specific product features aimed at satisfying
specific market needs, as well as the price range,
production quality and the demographics that is intended
to impact.
➢ Every single product that is on sale can be defined by its
niche market. As of special note, the products aimed at a
wide demographic audience, with the resulting low price
(due to price elasticity of demand), are said to belong to
the mainstream niche—in practice referred to only as
mainstream or of high demand. Narrower demographics
lead to elevated prices due to the same principle. So to
speak, the Niche Market is the highly specialized market
that tries to survive among the competition from
numerous super companies.
➢ Small but profitable segment of a market suitable for
focused attention by a marketer. Market niches do not
exist by themselves, but are created by
 identifying needs or wants that are not being addressed
by competitors, and by offering products that satisfy them.
➢ Niche marketing is an effort to connect with and sell to a
particular group of consumers
➢ There are many different ways to define a niche market,
with some examples revolving around geographic location,
age, gender, sexual orientation, religion, or profession.
While the marketer is open to consumers of all types, the
main focus of the public relations and marketing efforts
seeks to identify with the niche market and meet needs
that are common to that particular set of customers.

EXAMPLES:
➢ Mercedez , BMW , PORSCHE and other luxury cars are targeted
only to rich urban class who can afford them.
➢ Cars like Hyundai Sonata , Honda City are targeted to upper
middle class.
➢ Tata NANO is targeted to consumers as a replacement of two-
wheelers at a cost of RS 1 LAC ONLY
➢ Armani socks cost RS 900 for a pair targeted to rich people.
➢ Similarly, Pierre Cardin pens cost RS 250 each
➢ Advertisement campaign by Dr. Batra regarding loss of hair.
➢ A number of television channels cater to the need of a particular
niche; for example, sports channels like STAR
Sports, ESPN, STAR Cricket target a niche of sports lovers
➢ TVS promoting its brand Apache as TVS racing directed to the
youth segment identifying the growing demand of speed and
power in the segment.

NON-PROFIT MARKETING-
DEFINITIONS:
➢ Marketing activity undertaken by a firm whose primary
objective is one other than profit;
➢ organisations that buy and distribute goods and services for
reasons other than the return of profit to their owners.-----
Monash dictionary of marketing

EXAMPLES:
➢ AIRCEL launched SAVE TIGER CAMPAIGN.
➢ NDTV launched GREENATON.
 ➢ TATA TEA launches JAGO RE CAMPAIGN.
➢ BILL AND MELINDA GATES lauched a foundation to help people
from disesses like malaria.
➢ IT gaint INFOSYS has a foundation which works for the welfare of
society.

7 O’s model of study of consumer behaviour:

In order to understand the consumers in the target market,
marketers should follow the 7 O’s framework of consumer research.
The 7 O’s stand for – Occupants , Objects, Objectives,
Organizations, Operations, Occasions, Outlets.

OBJECT: (What does the market buy?)

DEFINITIONS:
➢ It is defined as the object of purchase or what does the
consumer buy. What are the features , sizes, colours ,flavours,
etc that the consumer seeks? Products – soft drinks, Product
forms – cols v/s lime v/s orange Brands – Coke v/s Pepsi

EXAMPLES:
➢ Hero Honda karizma is an object for young ,passionate sporty
guy.
 ➢ Tata nano for middle class who need it as a replacement for
scooter.
➢ Indigo airlines for people loving cheap and economic cost airlines
➢ Parker pens for middle level executives.

OBJECTIVE(WHY DOES THE MARKET BUY? )

DEFINITIONS:
➢ WHY IS CONSUMER BUYING? (OBJECTIVE) Why of buying &
explain what benefits the consumer expects the product or
services to serve. What motive is he trying to satisfy?

EXAMPLES:
➢ To gift to someone during birthday.
➢ To uplift your status symbol
➢ To impress others
➢ To cater to the present needs ie if your family size is increased
then hatch batch car is replaced by big cars like SAFARI.

OCCASION(When does the market buy?)

DEFINITIONS:
➢ WHEN DO THEY BUY OR HOW DO THEY BUY & USE ( OCCASION)
Buying rate or buying frequency of consumers & occasions on
which they would buy the product or service for the desired
benefits.
EXAMPLES:
➢ Festival season—holi , diwali ,EID etc.
➢ Holidays ie weekends.
➢ Birthdays
➢ Aniversary
➢ Valentine day

OCCUPANT (Who constitutes the market? )

DEFINITIONS:

➢ Occupant is defined as those who constitute the market. Helps to

understand consumer’s geographic, demographic,
psychographic & media graphic profile.
➢ Demographic profile is the study of age, gender, income,
occupation, educational qualifications of the consumer.
 ➢ Psychographic profile is the study of the lifestyle of the
consumer as expressed by activities , interests & opinions of the
consumer.
➢ Geographic profile is the region to which the consumer belongs .
Media graphic are the media habits of the consumer.

OFFILINE TARGETING STRATEGY:

DEFINITIONS:
➢ A popular offline targeting strategy is to create a brand name
and style that carries a stigma that your target audience can
identify with.--------(GOOGLE)
➢ Back in the nineties when the economy was still healthy
Abercrombie and Fitch marketing affluence and exclusivity at
middle class society and as a result created a clothing label out
of thin air that was the requirement for all teens and college
kids. Their success did not happen overnight as they participated
in wide consumer research strategies throughout their period of
success to provide what they deemed their audience wanted.—
(WIKIPEDIA)

EXAMPLES:
➢ Distribution of pamphlets during promotion of products.
➢ Personal selling
➢ Promotion through posters
➢ Advertisements in T.V and radio stations.

ONLINE MARKET RESEARCH

The use of computer networks, including the internet, to assist in any

phase of the marketing research process, including development of
the problem, research design, data gathering, analysis, and report
writing and distribution.

Marketing Research, Alvin C. Burns & Ronald F. Bush

When organizations use internet to support a phase, or whole of the

market research process, it is termed as online market research.
 Marketing Research- Text & Cases, Harper W. Boyd & Stanley F.
Stasch

Online marketing research is the process by which companies use the

Internet to gather data to evaluate how well a product or service is
selling to consumers.

Marketing Research, Gilbert A. Churchill, Jr.

According to the authors of Online Marketing Research: “ The advent

of the Web has led to a revolution in the research community” Today
RFPs, sample design and ordering, data collection, data analysis and
report writing and distribution are carried out through online tools and
services.

Online research is relatively low in cost in the sense that participants

from all over the globe can pitch into the discussions, without
engaging in any kind of travel and/or living expenses.

This module of market research also allows speed of execution.

Although online research requires some prior advanced scheduling and
preparations, in the long run it proves to be worth the effort. Teens,
well-educated professionals, working mothers can be effectively
reached through online research. The response rate is also seen to be
better off as they can respond to the research in their own space and
at their own convenience.

OPERATION (from the seven O’s of consumer buying behaviour)

7 O’s model of study of consumer behaviour:

In order to understand the consumers in the target market, marketers

should follow the 7 O’s framework of consumer research. The 7 O’s
stand for - Occupants, Objects, Objectives, Organizations, Operations,
Occasions, Outlets.

Who constitutes the market? Occupant

What does the market buy? Object
Why does the market buy? Objective
Who participates in buying? Organization
How does the market buy? Operation
When does the market buy? Occasion
Where does the market buy? Outlet
HOW THE CONSUMERS BUY(OPERATIONS) - What kind of background
information do consumers collect before buying & from whom they
seek this information.

Example – information collected before purchase.

OPERATIONAL DECISIONS

Operational decisions are short-term decisions as opposed to the

longer-term strategic investment decisions that are needed when
physical assets are being acquired. Some of the more common
decisions related to plant operations involve material, plant facilities,
and in-house capabilities of company personnel. Short term
operational decisions are also called Present Economic Studies and
they require the estimation of costs associated with various production
and manufacturing activities. These costs provide the basis for
developing successful business strategies and planning future
operations.

To make operational decisions it helps to understand some

fundamental cost-volume relationships related to the operation of a
company. A visit to the "Short-term Decisions" page will then be
appropriate for a review of some common examples of short-term
operational decisions.

Decisions that involve routine tasks, such as planning production and

sales, scheduling personnel and equipment, adjusting production
rates, and controlling the quality of production.

OPERATIONAL STRATEGY

A plan to transform an organization's overall strategic objectives into

operational deliverables. It involves the design of the product or
service and the processes by which the product or service is produced;
the way in which production is managed and controlled; and the
design of processes for the constant improvement of the operation. If,
at the strategic level, the organization decides to compete in the
market on the basis of superior quality, the operations strategy has to
plan to produce a package incorporating the specified quality within
stated financial constraints. If the strategy is to compete on cost, the
plan must produce the product cheaply within the limits of acceptable
quality.

A dictionary of business- Oxford University Press

 “Operations strategy is the total pattern of decisions which shape the
long-term capabilities of any type of operations and their contribution
to the overall strategy, through the reconciliation of market
requirements with operations resources.”

Slack and Lewis

It is concerned with how each part of the business is organised to

deliver the corporate and business-unit level strategic direction.
Operational strategy therefore focuses on issues of resources,
processes, people etc.

OPPORTUNITIES

SWOT analysis is a strategic planning method used to evaluate the

Strengths, Weaknesses, Opportunities, and Threats involved in a
project or in a business venture. It involves specifying the objective of
the business venture or project and identifying the internal and
external factors that are favorable and unfavorable to achieve that
objective. The technique is credited to Albert Humphrey, who led a
convention at Stanford University in the 1960s and 1970s using data
from Fortune 500 companies.

A marketing opportunity is an area of buyer need in which a company

can perform profitably. Opportunities can be classified according to
their attractiveness and their success probability. The company’s
success probability depends on whether its business strengths not only
match the key success requirements for operating in the target
market, but also exceed those of its competitors. Mere competence
does not constitute a competitive advantage. The best-performing
company will be the one that can generate the greatest customer
value and sustain it over time.

Philip Kotler

These are external chances to make greater sales or profits in the

environment.

Keeping in mind the Company Strengths, SWOT Analysis can now

influence the Opportunities for the business. These can be seen as
targets to achieve and exploit in the future for example:
 1. Good financial position creating a good reputation for future
bank loans and borrowings
2. Skilled workforce means that they can be moved and trained
into other areas of the business
3. Competitor going bankrupt (Takeover opportunity?)
4. Broadband technology has been installed in the area (useful for
Internet users)
5. Increased spending power in the Local/National economy
6. Moving a product into a new market sector

In SWOT, opportunities and threats are external factors.

For example an opportunity could be:

1. A developing market such as the Internet.

2. Mergers, joint ventures or strategic alliances.
3. Moving into new market segments that offer improved profits.
4. A new international market.
5. A market vacated by an ineffective competitor.

ORGANIZATIONAL MARKETING

Simply put, organizational marketing “sells” the unique service or

services offered by a supported employment provider. Marketing
efforts are directed toward two constituents: 1) community employers;
and 2) job seekers with significant disabilities. Specifically, the services
that will be marketed to community employers will be the availability
of a rich pool of personnel options, as well as employment centered
consultation.

Organizational marketing requires a creative plan of action and

ongoing evaluation. The plan of action identifies the niche or service
identity, competition, resources, customers served, and the outcomes
which are expected. The results of such planning and development
provide an overall strategy and framework for achieving success.
 Virginia Commonwealth University, Rehabilitation Research and
Training Center on Supported Employment

Definition:

A development of the well established term 'INDUSTRIAL MARKETING'

to cover the MARKETING of all goods and services between one
organization and another. The marketing approach is thus identifiably
linked to the subsumed existence of ORGANIZATIONAL BUYER
BEHAVIOUR. The key CONCEPT is that the fundamental differentiating
feature between types of marketing activity is not the nature of the
goods being traded, but the nature of the demand. Whereas
CONSUMERS are perceived as buying frequently (if not always) for
immeasurable personal satisfaction, organizations are seen as buying
deliberately, usually with quantifiable benefits in view. Marketers thus
require to base their approaches accordingly - even if the PRODUCT
being traded is for eventual personal consumption.

Westburn dictionary of marketing

OUTDOOR ADVERTISING

Technically correct term for the ADVERTISING MEDIUM colloquially

referred to as 'posters'. The category does not include POSTER SITES in
railway or underground stations, or advertising spaces in underground
trains, on and in buses, and so on. The term for this subset is
'transport advertising'. The two are taken together, in industry
analyses and statistics. 'Outdoor and transport' ranks third among the
five MAJOR MEDIA, with a 4 per cent share of the total UK advertising
expenditure. The term 'posters' is generally used in this dictionary in
place of the more cumbersome and less self-explanatory combined
description.

Westburn dictionary of marketing

Any advertising done outdoors that publicizes your business's products

and services. Types of outdoor advertising include billboards, bus
benches, interiors and exteriors of buses, taxis and business vehicles,
and signage posted on the exterior of your own brick-and-mortar
location.
 Entrepreneur Encyclopaedia

Out-of-home advertising (or outdoor advertising) is made up of more

than 100 different formats, totaling $6.99 billion in annual revenues in
2008 in the USA. Outdoor advertising is essentially any type of
advertising that reaches the consumer while he or she is outside the
home. This is in contrast with broadcast, print, and Internet
advertising.

Out of home advertising, therefore, is focused on marketing to

consumers when they are "on the go" in public places, in transit,
waiting (such as in a medical office), and/or in specific commercial
locations (such as in a retail venue). Outdoor advertising formats fall
into four main categories: billboards, street furniture, transit, and
alternative.

Advantages of Outdoor advertising: Flexibility; high repeat exposure;

low cost; low competition

Limitations: Limited audience selectivity; creative limitations

OVER POSITIONING

Specifying the brand or product too narrowly with the result that some
of the target customers are not reached effectively.

Westburn dictionary of marketing

Over positioning is when your marketing makes the product too

special, so the potential customer group becomes too small.

It means that buyers believe that the product is meant for a very
select audience because it is premium priced.

➢ For example, when Aqua Guard introduced Aqua Sure, people

thought that it was meant for upper class consumers. Whereas
the product was priced only at Rs. 1600.

PACKAGING
The materials (glass, aluminium, cardboard, etc) originally intended
merely to contain and protect a product; in recent years the role of
packaging has been broadened so that, in addition to containment and
protection, its purpose is to attract attention, provide additional
product information, and assist in promotion.

Monash University marketing dictionary

Packaging is wrapping in which an item is presented for sale;

presentation of a package

pack, wrap; create attractive packaging in order to promote the sale of

an item; combine things together as one inseparable unit

Packaging includes the activities of designing and producing the

container for a product. The container is called the package, and it
might include up to three levels of material.

Philip Kotler

Packaging can be defined as the wrapping material around a consumer

item that serves to contain, identify, describe, protect, display,
promote, and otherwise make the product marketable and keep it
clean.

Prof. Dileep Kumar M.

Ex-Professor, Symbiosis (SCMHRD, SCDL)

An important distinction is to be made here between two types of

packaging

➢ Transport packing: The product entering in to the trade need to be

packed well enough to protect against loss damage during
handling, transport and storage. Eg: fiberboard, wooden crate etc.
➢ Consumer Packing: This packaging holds the required volume of the
product for ultimate consumption and is more relevant in
marketing. Eg: beverages, tobacco etc.
• Old Spice aftershave lotion is in a bottle (primary package)
that is in a cardboard box (secondary package) that is in a
corrugated box (shipping package) containing six dozen
boxes of Old Spice.
PENETRATION PRICING

Penetration pricing is the pricing technique of setting a relatively low

initial entry price, often lower than the eventual market price, to
attract new customers. The strategy works on the expectation that
customers will switch to the new brand because of the lower price.
Penetration pricing is most commonly associated with a marketing
objective of increasing market share or sales volume, rather than to
make profit in the short term.

Westburn dictionary of marketing

Penetration pricing is a market-based approach to pricing wherein the

price is set to a sufficiently low level to make the product attractive to
the mass market. The aim is to achieve a large market share by high
initial sales. It is introducing the product at a low price intended to
capture the mass market for the product or service.

Strategy adopted for quickly achieving a high volume of sales and

deep market-penetration of a new product. Under this approach, a
product is widely promoted and its introductory-price is kept
comparatively lower. This strategy is based on the assumption that (1)
the product does not have an identifiable price-market segment, (2) it
has elasticity of demand (buyers are price sensitive), (3) the market is
large enough to sustain relatively low profit margins, and (4) the
competitors too will soon lower their prices.

The price charged for products and services is set artificially low in
order to gain market share. Once this is achieved, the price is
increased.

Setting prices low in order to gain as much market share as possible as

quickly as possible.

• Firms such as Texas Instruments choose this objective because

they believe that higher sales volume will lead to lower unit
costs and .higher long-run profit.
• This approach was used by France Telecom and Sky TV.
PERCEPTUAL MAPPING

Perceptual mapping is a graphics technique used by asset marketers

that attempts to visually display the perceptions of customers or
potential customers. Typically the position of a product, product line,
brand, or company is displayed relative to their competition.

It is the use of a graph or map in the development of a new product, in

which the proximity of consumers' images of the new product to those
of an ideal product provide an indication of the new product's likely
success

It is the process by which consumers' perceptions of an existing

product are charted. Consumers answer questions about a given
product based on their experience with the product and their thoughts
about what the product should be. Answers are plotted on a graph,
and the results are used to make improvements in the product or in
the creation of new products.

Perceptual maps can have any number of dimensions but the most
common is two dimensions. Any more is a challenge to draw and
confusing to interpret.

• The perceptual map below shows consumer perceptions of

various automobiles on the two dimensions of
sportiness/conservative and classy/affordable. This sample of
consumers felt Porsche was the sportiest and classiest of the
cars in the study (top right corner). They felt Plymouth was most
practical and conservative (bottom left corner).
PERSON MARKETING

It is the marketing activity aimed at creating target market awareness,

and a favourable opinion, of a particular person.

Person marketing involves efforts designed to cultivate the attention,

interest, and preferences of a target market towards a celebrity or
authority figure.

• Oprah Winfrey uses person marketing to promote her O

magazine.
• GM paying Tiger Woods 40 million for a 5 year contract ending in
2009 is an example of person marketing.

PERSONALITY & SELF CONCEPT

Self-concept (or self-image) is related to personality. Marketers often

try to develop brand images that match the target market’s self-
image. Yet it is possible that a person’s actual self-concept (how she
views herself) differs from her ideal self-concept (how she would like to
view herself) and from her others-self-concept (how she thinks others
see her). Which self will she try to satisfy in making a purchase?
Because it is difficult to answer this question, self-concept theory has
had a mixed record of success in predicting consumer responses to
brand images.

Philip Kotler

Self-concept (also called self-construction or self-perspective) is a

multi-dimensional construct that refers to an individual's perception of
"self" in relation to any number of characteristics, such as academics
(and nonacademics), gender roles and sexuality, racial identity, and
many others. While closely related with self-concept clarity (which
"refers to the extent to which self-knowledge is clearly and confidently
defined, internally consistent, and temporally stable"), it presupposes
but is distinguishable from self-awareness, which is simply an
individual's awareness of their self. It is also more general than self-
esteem, which is the purely evaluative element of the self-concept.
It is defined as the “totality of the individual’s thoughts and feelings
having reference to himself as an object.

The self-concept is the accumulation of knowledge about the self, such

as beliefs regarding personality traits, physical characteristics,
abilities, values, goals, and roles.

Lewis, Michael. "Social Knowledge and Social Development." Merrill-

Palmer Quarterly 36 (1990):93-116

POINT-OF-SALE:
1) A data collection system that electronically receives and stores bar
code information derived from a sales transaction. This could the zip
codes for library users, facilitating the library in determining
geographic market are that users reside in.

2) Point of sale marketing, commonly known as point of purchase

advertising, attracts retail shoppers at the point of a purchase. In
other words, point of sale (POS) marketing lures shoppers into
buying additional products or services at checkout. Point of sale
marketing utilizes display to catch a shopper's attention; displays
can range from signs and banners to coupon dispensers and video
advertisements at the cash register. Regardless of the type of
display, POS marketing often results in impulsive purchases

PRIORI SEGMENT:
1) It starts by using identifiable variables to divide the market based
on who the customers are, in the hope that resulting segments
perfume differently in response to market mix variables.

2) In a priori segmentation, the market is split according to pre-

existing demographic criteria such as age, sex or social
economic status.

PRODUCT
1) relating to the good or core service being sold.
 2) Product. What your product offers that your customers value,
and whether/how you should change your product to meet
customer needs.

3) Product – Product is a bundle of utilities. It must provide value

to a customer but does not have to be tangible at the same time.
Basically, it involves introducing new products or improvising the
existing products. It includes the features, style, shape, design,
guarantee, warranty, after sales service, insurance etc. It
includes tangible products as well as services.

e.g. a) Colgate Toothpaste are available in various variants such

as Total, Sensitive, Herbal, Active Salt b) Transcend memory
chips come with lifetime warranty.
c) Hotel Industry which is a service is also included in product.

4) Anything that is of value to a customer and can be offered

through a voluntary marketing exchange.

5) The physical goods sold to customers and other organisations

as well as the services that are offered to individual consumers,
other businesses and the government.
-Kenneth E Clow and Donald
Baack
PRICE –
1) The price is the monetary value of the product. It is the
amount a customer pays for the product. Pricing decisions
should take into account profit margins and the probable
pricing response of competitors. Pricing includes not only the
list price, but also discounts, financing and other options such
as leasing. Pricing must be competitive and must entail profit.

e.g. a) Asian Paints – Royale Luxury emulsion has been placed by

Asian Paints as a premium product. It is priced at Rs. 315-345 for
1 litre.
b) Dell Studio Laptops are priced at Rs. 42,000 onwards.
c) Pepsi is priced at Rs. 10 equal to the competitor Coca Cola
2) the transactions price that the customer pays for the product.
3) The overall sacrifice a consumer is willing to make – money, time,
energy to acquire a specific product or service.
4) Pricing is the process of determining what a company will receive in
exchange for its products.
Pricing factors are manufacturing cost, market place, competition,
market condition, and
quality of product. Pricing is also a key variable in microeconomic price
allocation theory.
Pricing is a fundamental aspect of financial modeling and is one of the
four Ps of the marketing
mix. The other three aspects are product, promotion, and place. Price
is the only revenue
generating element amongst the four Ps, the rest being cost centers.
5) Pricing is the manual or automatic process of applying prices to
purchase and sales orders, based on factors such as: a fixed amount,
quantity break, promotion or sales campaign,
specific vendor quote, price prevailing on entry, shipment or invoice
date, combination of multiple orders or lines, and many others.
Automated systems require more setup and maintenance but may
prevent pricing errors. The needs of the consumer can be converted
into demand only if the consumer has the willingness and capacity to
buy the product. Thus pricing is very important in marketing.
Eg. When Sony introduced the world's first high definition television to
the Japanese market in 1990, the high-tech sets cost $43,000. These
televisions were purchased only by customer who could afford to pay a
high price for the new technology. Sony rapidly reduced the price over
the next several years to attract new buyers. By 1993, a 28-inch HDTV
cost a Japanese buyer just over $6,000. In 2001, a Japanese consumer
could buy a 40-inch HDTV for about $2000, a price that many more
customers could afford. In this way, Sony skimmed the maximum
amount of revenue from the various segments of the market the above
example shows skimming pricing.
6) The amount charged for a good or a service.
- Kenneth E Clow and Donald Baack
PIMS (PROFIT IMPACT OF MARKET STRATEGY) — an ongoing
research and consulting activity focused on competitive marketing
strategy and benchmarking using a business-unit database. The
research and benchmarking activity focuses on measuring metrics that
track a business’s competitive position (relative overall
quality/performance, market share, and capital intensity) and relating
competitive position and market attractiveness metrics to measures of
business results (profitability and growth).

PRICE CUSTOMIZATION — Setting different prices for different

market sub-segments, pricing higher in sub-segments that
perceive the most differential worth in your product, and reducing
price to appeal to other sub-segments according less worth to your
product.

PRICE DIFFERENTIAL — 1) The difference between the price of an

offering and the price of a reference offering. Products that perform
better than average are often priced higher than the average price.
Products that perform worse than average are often priced lower than
average.

2) The marketing manager can charge different kinds of prices

in different markets. This is known as Price differential or Price
discrimination.
- Tapan K Panda

3) Selling merchandise to different buyers at different price.

- Kenneth E Clow and Donald Baack
4) The practice of charging different prices to segments of the
market according to their price elasticity or sensitivity.
- Russell s. winer

5) A difference in the prices of two products or of the same

product in different places

PRICE-PERFORMANCE PROFILE — A table showing customer-

perceived performance scores, attribute relative importance, and
prices of major offerings in a category for the major competitors in the
market.
 PRICE PREMIUM — The selling price of the vendor's product minus
the selling price of a reference product. It is the opposite of the price
advantage a vendor enjoys when selling at a price below the price of
the reference product.

PRE-PURCHASE – This is the stage in which the consumer does a

market research for a particular kind of product.

POST-PURCHASE – 1) This is the stage in which the consumer looks

for the services provided after the purchase. After purchase, the
consumer will experience some level of satisfaction or dissatisfaction.
If the product fails short of buyer’s expectation, the buyer will be
disappointed & dissatisfied. This dissatisfaction is called Cognitive
Dissonance. The marketer should always use to reduce the cognitive
dissonance by cementing with ads and building relationship with the
consumer.
Post-purchase evaluation: the stage after
a product or service has been purchased and used in which
the consumer reflects on whether the product met expectations,
exceeded them or was disappointing.

1) Positioning is the act of designing the company’s offering and

image to occupy a distinctive place in the minds of the target
market. The goal is to locate the brand in the minds of
consumers to maximize the potential benefit to the firm. The
result of positioning is the successful creation of a customer
focussed value proposition.
Examples-
a. Mahindra & Mahindra positioned their SUV Scorpio to life style oriented
consumers.
b. Indica by Tata Motors for small car consumers who want a more
spacious vehicle.
c. Domino’s Pizza for convenience-minded pizza lovers . Benefits being
delivery, speed, and good quality.
 1) Developing a specific marketing mix to influence potential
customer’s overall perception of a brand , product line.
2) The place a good or service occupies in the mind of consumers
and relative to the competition.

4) Positioning has come to mean the process by which marketers

try to create an image or identity in the minds of their target
market for its product, brand, or organization.
Re-positioning involves changing the identity of a product,
relative to the identity of competing products, in the collective
minds of the target market.
De-positioning involves attempting to change the identity of
competing products, relative to the identity of your own product,
in the collective minds of the target market.

POINTS-OF-DIFFERENCE (PODs) are the attributes or benefits

consumers strongly associate with a brand, positively evaluate, and
believe they could not find to the same extent with a competitive
brand .Associations that make up points of difference may be based on
virtually any type of attribute or benefit.

Examples-
a. Apple(Design)
b. Nike(Performance)
c. Lexux (Quality)

POINTS-OF-PARITY
-(POPs) are the associations that are not necessarily unique to the
brand but may in fact be shared with other brands. These types of
associations come in two basic forms : category and competitive.

Example-
Situation of Savlon when it entered the antiseptic lotion market
in India dominated by dettol.
PLACE - 1) How and where you sell. This may include using different
distribution channels. For example, you might sell over the Internet or
sell through retailers.
2) It includes channel management and physical distribution.
Distribution is about getting the products to the consumer. Some
examples of distribution include – Distribution channels, market
coverage, warehousing, order processing, transportation, inventory
management.
3) Place represents the location where a product can be purchased. It
is often referred to as the distribution channel. It can include any
physical store as well as virtual stores on the Internet.

e.g. a) Nikon has centres and showrooms in almost every state

across India.
b) Raymonds is retailed through 30,000 stores in over 40 towns
across India.
c) Maruti Suzuki has one of the widest chain to dealers
throughout the country with multiple dealers in most cities.

4) Deciding where, how and when products will be available to

potential customers.

POLITICO-LEGAL:

1) Marketing decisions are strongly affected by developments in the

political
and legal environment. This environment is composed of laws,
government agencies, and
pressure groups that influence and limit various organizations and
individuals. Sometimes
these laws also create new opportunities for business. For example,
mandatory recycling laws
have given the recycling industry a major boost and spurred the
creation of dozens of new
companies making new products from recycled materials.
2) The basic understanding of the political legal environment is when
the government implement's laws and or regulations which effects the
way a business operates.

Example:
•Norway bans several forms of sales promotion—trading stamps,
contests, and
premiums— as inappropriate or "unfair" instruments for promoting
products.
Thailand requires food processors selling national brands to market
low-price brands
also, so that low-income consumers can find economy brands.
In India we cannot sell electric appliances.
Danger sign on cigarette packs
Pricing of medicines is regulated
Control on petroleum and diesel prices

PERSUADE – 1) To induce to undertake a course of action or embrace

a point of view by means of argument or reasoning. Persuasion is used
to stimulate consumers to purchase products even if they do not really
need it.

e.g. a) Cadbury Celebrations persuades consumers to buy it

during festivals
b) Big Bazar organizes sales and discount offers on Republic Day
etc. to persuade consumers to buy.

2) Communication used to motivate consumers to take action.

- Tata Mcgraw hill

PRICE SKIMMING -
1) A Strategy of selling a new product or service at a high price that
innovators and early adopters are willing to pay in order to obtain it
after the high- price market segment becomes saturated and sales
begin to slow down, the firm generally lowers the price to capture or
skim the next most price sensitive segment.
- Tata Mcgraw Hill
2) Pricing policy whereby a firm charges a high introductory price,
often coupled with heavy promotion.
 -Lamb, Hair and Mcdaniel
3) Price skimming is a pricing strategy in which a marketer sets a
relatively high price for a product or service at first, then lowers the
price over time. It is a temporal version of price discrimination/yield
management. It allows the firm to recover its sunk costs quickly before
competition steps in and lowers the market price.
-Wikipedia
4) A product pricing strategy by which a firm charges the highest initial
price those customers will pay. As the demand of the first customers is
satisfied, the firm lowers the price to attract another, more price-
sensitive segment.
-investopedia

PRICE POSITIONING

It refers to the process of differentiating your product on the

basis of price. i.e.
Selling your product at such a price at which your competitors
are not selling

For eg:
• Tata motors launched Tata Nano as lowest price car
• Micromax came up with wide range of cell phones
available at lowest price

QUANTITATIVE MARKETING RESEARCH

 It is the application of quantitative research techniques to the
field of marketing. It has roots in both the positivist view of the
world, and the modern marketing viewpoint that marketing is an
interactive process in which both the buyer and seller reach a
satisfying agreement on the "four Ps" of marketing: Product,
Price, Place (location) and Promotion.
As a social research method, it typically involves the
construction of questionnaires and scales. People who respond
(respondents) are asked to complete the survey. Marketers use
the information so obtained to understand the needs of
individuals in the marketplace, and to create strategies and
marketing plans.

RE POSITIONING

Repositioning refers to the strategy which the firm adopts when

the demand of their product starts falling or people starts
ignoring that product

For eg:
• When onida failed in India they went to middle Asian
countries
• Surf re positioned itself as a high quality product when
other products entered the market

REFERENCE GROUPS

Reference groups refers to those groups that have either direct

or indirect influence on the costumer’s buying decision

For eg:
• Children like to buy Adidas cricket bat just because Sachin
Tendulkar uses the same

REMARKETING
 Remarketing refers to the dedicated marketing efforts to spur
demand for a product that is experiencing declining demand by
marketing it as though it were a new product

For eg:
• Maruti Suzuki relaunched Maruti VERSA as EECO when
people were not buying versa

• Tata motors launched Sumo Grande when their sumo was

not successful

REMIND

Reminding refers to the process of ensuring that people continue

buying your product. It thus creates TOMA among the costumers

For Eg:
• Colgate is being advertised on a continuous basis so as to
retain its costumers

RETAIL AUDIT

Study of a selected sample of retail outlets, provided as

subscription-based service by market research firms. Retail-audit
service providers gather information on a brand's sales
volume, sales trends, stock levels, effectiveness of in-store
display and promotion efforts, and other associated aspects.

For eg:
• The metropolitan cities having a population of more than
15 million have more than 20,000 retailers of mobile SIM
cards; 60% of them would also be retailing mobile
handsets

RETAIL MARKETING STRATEGY

 Retail marketing strategy refers to how a store and its products sell
goods to its target customers. Each type of retail business has to
make decisions about all the details of its marketing mix. A
marketing mix consists of the product, price, place, promotion and
packaging. Internet marketing strategies and those for stores that
people shop at in person must be developed to meet the needs of
potential customers. A retail marketing strategy is first outlined in
a business plan.

For eg:
• Amway sells their product through direct selling
• Hul sells their products through wholesaler , retailers and
then final costumers

RETAILING

Retailing may be defined as a process of selling goods and

services to the consumers in small quantity through a number of
small retail outlets

For Eg:
• Titan sells its watches through its retail outlets

• Hul sell its entire product range through a number of

retailers located in different areas

REVERSAL MARKETING

Reversal marketing is done where the people have a negative attitude

towards your product. By this type of marketing the marketer creates
a positive attitude in the minds of the consumers.
Examples:
• Hospitals provide various facilities like free health check-up
• Celebrating world heart day for avoiding heart related problems

ROUTINE BUYING BEHAVIOUR

Many products are bought under condition of low consumer
involvement & absence of significant brand differences. The marketer
should generalize the brand and provide wide distribution of the
product.
Example
• Consumer involvement is very low in frequently
purchased products like salt, vegetables

PENETRATION PRICING

It is the pricing technique of setting a relatively low initial entry

price, often lower than the eventual market price, to attract new
customers. The strategy works on the expectation that customers
will switch to the new brand because of the lower price. Penetration
pricing is most commonly associated with a marketing objective of
increasing market share or sales volume, rather than to make profit
in the short term

For Eg:
• Micromax came with low priced cell phones

• Nirma detergents are available at relatively

lower prices

SEX/GENDER (SEGMENTATION)

Dividing a large population into homogeneous groups on the

basis of gender / sex
For eg:
• Allen solly recently introduced a wide range of corporate
clothing just for women

• Hero Honda launched Pleasure scooters targeting all the

girls
SEGMENT ATTRACTIVENESS

Use predetermined attractiveness criteria to determine

attractiveness of each segment. It depends on various factors like
segment profitability, segment size , growth in that particular
segment

SEGMENT POSITIONING

It refers to the process of targeting your product to a particular

segment of the market after identifying the needs and wants of
that segment

For eg:
• Johnsons & Johnsons sells their products targeting all the
new born babies

• Ponds sells their talcum products targeting only women

SEGMENT PROFITABILITY

Object within Profitability Analysis to which costs and revenues are

assigned. A profitability segment corresponds to a market segment.
You can calculate the profitability of a profitability segment by
setting off its sales revenues against its costs. A profitability
segment in an operating concern is defined by a combination of
characteristic values.

SELECTIVE DE-MARKETING

Selective De-marketing refers to a situation where the selectively

lay-off some of its costumers when it is faces excess demand for its
product
For eg:
 • During Season usually Taj Hotels take back all the
discounts that have so as to excludes those costumers
who comes due to price factor
• Jet Airways throws swingers and switchers at the time
of full occupancy in the flights giving preferences to its
hard core customers

SELLING CONCEPT

Selling concept is derived from both, distribution and promotional

concept.
This type of strategy is also termed as the PUSH strategy. There is no
demand for such products, but the marketers have to push the
products so that the consumers buy them.
For eg:
Maruti Suzuki aggressively sold WagonR when costumers were not
accepting it

TARGET MARKET

Target market refers to the particular market that the company wants
to cater
For eg:
Tag Heuer caters to only high end of the market

UNIQUE SELLING PROPOSITION

The Unique Selling Proposition (also Unique Selling Point). It states that
such campaigns made unique propositions to the customer and that
this convinced them to switch brands. The term was invented
by Rosser Reeves of Ted Bates & Company. Today the term is used in
other fields or just casually to refer to any aspect of an object that
differentiates it from similar objects.

 Domino's Pizza: "You get fresh, hot pizza delivered to your door in
30 minutes or less -- or it's free."
 FedEx: "When your package absolutely, positively has to get there
overnight"
 Head & Shoulders: "You get rid of dandruff"
 Olay: "You get younger-looking skin"

Product:-
1) A good, service, person, or idea consisting of a bundle of tangible
and intangible benefits that satisfies consumers' needs and wants.
2) Of the Product is the most tangible and important single component
of the marketing programme.
3) The goods or services that one enters the marketplace to market
and sell.
4) Product is the building block of marketing plan.
5) Product is the engine that pulls the rest of the marketing
programmes.
6) Product is the vehicle by which a company provides consumer
satisfaction.
7) Product is one of the component of the 4P’s.
8) Product is the external marketing plan and strategy. Product for the
internal market is all the changes and innovations that are needed
to make the external strategy work, including canges in people’s
attitude and behavior.

Examples:-
1) Maruti 800 is a product of Maruti Suzuki.
2) Tata Nano is a product of Tata Motors.
3) Fast Track is a product of Titan.
4) Motorazr is a product of Motorla.
5) Passion is a product of Hero Honda.

PRODUCT APPRAISAL AND PRODUCT APPRAISAL TABLE:-

Product Appraisal:- Product appraisal is the process of evaluating how
much a product is worth. This is done by comparing the performance
of the product against comparable products on the market.
Product Appraisal Table:- The Product Appraisal Table is a standardized
layout for doing the comparison for Product Appraisal.

PRODUCT BUNDLE PRICING:-

1) It is defined as “combining several products and offering the
bundle at a reduced price”.
2) Product bundling is a marketing strategy that involves offering
several products for sale as one combined product

Examples:-
1) “Xbox 360 Super Elite 250GB Bundle,” for example, includes an
Xbox 360 console, Final Fantasy XIII, an Xbox 360 250GB hard
drive, 2 Xbox 360 wireless controllers, an Xbox 360 wired
headset, an Ethernet cable, a standard definition Xbox 360
composite A/V/ cable, and a Final Fantasy face plate. This
package sells at a price of $399. This saves the customer
roughly $35 compared to if these items were purchased
individually.
2) In the fast food industry in which multiple items are combined
into a complete meal.

PRODUCT DIFFERENTIATION:-
1) A marketing process that showcases the differences between
products. Differentiation looks to make a product more attractive
by contrasting its unique qualities with other competing
products.
2) It is the process of distinguishing a product or offering from
others, to make it more attractive to a particular target market.
This involves differentiating it from competitors' products as well
as a firm's own product offerings.
3) Product Differentiation is concerned with the bending of demand
to the will of supply.(-Smith)
4) It represents a product orientated approach that it is an ‘inside
out’ management attitude to marketing planning.
5) The process of creating and designing products so that
consumers perceive them as different from competing products.
(-marketing concept and stratergies-biztantra-pride,fenell).

Examples:-
 1) Wheaties is The Breakfast of Champions. Bran Flakes is, well,
bran flakes. [Packaging]
Tide costs $5 per bottle. Safeway detergent costs $3.00 per
bottle. [Pricing]
Folgers coffee is made from Robusto coffee beans. Millstone
Coffee is made from Arabica beans. (Both come from the same
company BTW) [ingredients]
2) chocolate bars.
product differentiation through packaging, product
quality(different ingredient content) and brands.

PRODUCT DISTRIBUTION:-
1) The process of making the goods available to the consumers
from the manufacturers.
2) The ratio in which the finished goods is sent off to the market.
3) Making the goods available to the target market.

Examples:-
1) Pepsi has good production distribution system due to which it is
available even in rural areas.
2) Hera Honda its product available in all over India by a good
distribution system.
3) Duck Bags distributes its products more in Pondicherry and
other areas where there is rainfall for longer duration in a year.

PRODUCT LAUNCH:-
1) The debut of a product into the market. The product launch
signifies the point at which consumers first have access to a
new product.
2) The promotional plan for the introduction of a new product.
3) The orchestrated introduction of a new product (or version of a
product) to the market

Examples:-
1) The product launch of Diet Coke failed as people wanted to drink
soft drink which has fully real and enjoyable.
 2) Recently Mahindra launched its motor bike ‘Mahindra Stallio’
which is promoted by Aamir Khan.
3) Samsung recently launched ‘Samsung Galaxy’ mobile phone.
4) Coca Cola recently launced its product ‘Minute Made Nimbu
Fresh’ to attack Pepsi’s ‘Nimbooz’.

PRODUCT LINE:-
1) It is a group of products that is closely related because they
perform a similar function, target at the same customer groups,
and marketed through same channels.
2) Product lining is the marketing strategy of offering for sale
several related products.
3) Pricing different products within the same product range at
different price points.
4) Product lines: a group of products, closely related by
production or marketing considerations, that exists within the
overall product mix.
5) Product Line: Product line is a collection of products, offered
by a firm, that satisfy similar needs for different target
audiences. Thus all products within a product line are related,
but may vary in terms of size, color, quality etc.
6) A set of related products sold by a single company.

Examples:-

1) An example would be a video manufacturer offering different

video recorders with different features at different prices.
2) Nokia produces a wide range of mobile phones throughout the
year which has different features.
3) HP produces a wide range of printers.
4) LG produces different varities of television, mobiles, AC’s and
other consumer durables.
5) Hero Honda provides a wide range of Motor Bikes.
PRODUCT MIX:-
1) The complete set of all products offered by a firm is called its
product mix. (Marketing-TMH-Grewal and Levy)
2) It is the set of all products lines and items that a particular
company offers to buyers.(marketing management-asian books-s
k sarangi).
3) The number of individual products produced or sold by an
organization.
4) This goes beyond simple inventory to take into account which
products bring the most revenue, are the most popular and
which are less so.
5) All of the different products that a company makes or sells.
6) The set of all product lines and items that a particular business
offers for sale to buyers
7) All of the products in a seller's total product line.

Ex:- Colgate-Palmolive Product Mix.

Oral Care Personal Care Household Fabric Care Pet
Care Nutrition
Toothpaste(Co Deodorants(S Dishwashing Laundry Hill’s Pet
lgate Total) peed Stick) Liquid(Palm detergents(F Nutrition-
olive) ab) Dog
food(Scie
nce Diet)
Toothbrush(Co Bar Automatic Fabric Cat
lgate Plus) Soaps(Irish dishwashing Softener(Sua food(Scie
Spring) liquid(Palmo vitel) nce Diet)
live)
Kid’s Body Household
Product(Colga Wash(Soft Cleaners(Aja
te Barbie Fruit Soap) x)
toothpaste)
Whitening Handwash(So Dish
Products(Colg ft Soap) Wipes(Palm
ate Simply olive)
White)
Floss(Colgate Men’s
Total Dental toiletries(Skin
Floss) Bracer
Aftershave)
Oral First
Aid(Colgate
Orabase)

PRODUCT PROMOTION:-
1) Communication used by a business to convince potential
customers to buy a specific product.
2) Product Promotion involves disseminating information about a
product, product line, brand, or company.

Examples:-
1) Coke in Taal was the first active product placement.
2) In American Idol the camera frequently showed the glasses of
the judges in which Coke was written and judges used to sip
coke through the glass.
3) While telecasting Cricket Tournaments companies generally
promote their product by Ads which generally consists of Soft
Drinks, Automobiles, Snacks.

PRODUCT RELATED SEGMENTATION:-

1) The method of identifying consumers by consumption or
amount of product usage, usually categorized
psychographically or demographically.
2) Percentage or number of a sample that represent the
population.
3) Projected population
4) Degree of loyalty that consumers feel towards the brand.

Exampes:-
 1) Rasna, for example is shown as being used in different situations
like a party, for unexpected guests, a drink at the end of a long
and tiring work day, etc

2) Taj group of hotels identifies those people who will be loyal to

them even if they increase their prices. This is done by product
related segmentation.

PROMOTION:-
1) The idea that you can merchandise candidates for high office,
like breakfast cereal, is the ultimate indignity of the democratic
process-Adlai Stevenson.
2) Advertisements contain the only truths to be relied on in a
newspaper- Thomas Jefferson.
3) Promotion is defined as the co-ordinated self initiated efforts to
establish channel of information and persuasion to facilitate or
foster the sale of goods or services, or the acceptance of ideas.
4) Promotion is persuasive communication to inform potential
consumers of the existence of products, to persuade and
convince them that those products have want satisfying
capabilities.
5) The method by which the benefits of those goods and services
are communicated in an effort to justify the price.
6) Communicating with the consumers under the relevant heading
i.e. advertising, sales force, sales promotion, public relations,
exhibitions, direct mail etc.
7) Promotion is a form of communication with an additional
element of persuasion to accept ideas, products, services.
8) Promotion is an important marketing strategy and is the spark-
plug of the marketing-mix.
9) Promotion helps people know that the right product at right
price is available at right place.
10) Promotion is the process of marketing communication to inform,
persuade, remind and influence consumers in favour of a
product or service.

Examples:-
 1) Big Bazaar promotes itself by promising to have the lowest price
products and in its Ad’s it uses Dhoni and Asin. It even promotes
by giving Discount offers and lowest price on Wednesday.
2) Micromax mobile uses promotion strategy of sponsoring Cricket
Tournaments and the Bollywood events. It even promotes to
have the latest technology at lowest price.

Promotional Merchandise:-
1) These are articles of merchandise that are branded with a logo
and used in marketing and communication programs.
2) Promotional Merchandise is anything that can be imprinted with
your company info, and then provided aside to customers or
prospects.

Examples:-

1) Nike uses a tick mark as promotional merchandise in all its

products.
2) Parle Hippo Chips has a hippopotamous which is black in colour
as its promotional merchandise.
3) The Commonwealth Games recently held in Delhi had Shera, a
tiger as its promotional merchandise.

PSYCHOGRAPHIC SEGMENTATION:-

1) It is the science of using psychology and demographics to better

understand consumers.
2) Psychographic segmentation is based on traits, attitudes,
interests, or lifestyles of potential consumer groups.

Examples:-
1) Mc Donald’s changed their menu in India to adapt to the
consumer preferences.They avoided beef and introduced
vegetarian burger.
2) Titan’s Fasttrack brand appeals to the young youth.
3) Titan’s value for money brand, Sonata, targets people who want
good looking watches at reasonable price.
 4) Femina, a woman’s magazine is targeted at the woman with a
broader world-view.
5) Instant Noodle manufacturers, ready-to-eat, fast-to-cook food
brands such as Maggi, Top Ramen, etc target at time
constrained customers.

PSYCHOLOGICAL PRICING:-

1) The recognition that buyer's beliefs and perceptions affect their

evaluations of prices.
2) A pricing technique that creates an illusion for customers or that
makes shopping easier for them.
3) Setting prices according to the psychographics of the aimed-at
market segment.
4) Setting the price of a product based on the wanted public
perception for that product- Cabe Kline.
5) Refers to consumer perceptions of retail prices.
6) using price as a means of influencing a consumer's behaviour or
perceptions.
7) A pricing approach that considers the psychology of prices and
not simply the economics-Kotler.

Examples:-
1) Bata produces products which are priced like Rs99 or Rs599 or
Rs999 to get the psychological pricing advantage.
2) Tata Sky has schemes which are priced as Rs149, Rs 299 etc.
and not round figures.
3) Koutions price their products i.e. shirts and trousers as Rs 999
only or Rs 1299 only to the advantage of the consumers
regarding pricing.

PUBLIC RELATIONS:-
1) Includes communications directed internally to employees of the
company or externally to consumers, other firms, the
government and the media – Kotler.
2) A variety of programs designed to promote or protect a
company’s image or its individual products.
 3) Mass-communications for which, unlike advertising, there is no
direct payment from the originating organization to the media
carrying the information.
4) to communicate information about the organization and/or its
products and services to audiences that may go beyond
prospective customers, to include any other group that the
organization wishes to influence, such as investors or
governments.
5) The total process of building goodwill towards a business
enterprise and securing a bright public image of the company is
called public relations. –S.K.Sarangi

Examples:-
1) When Honda Motors had to call back its Honda City model its PR
manager had to give official statement about it.
2) When ever any company need to address the media the
generally the public relation officer makes the necessary
arrangements for it.

PURCHASE BEHAVIOR:-
1) Purchase Behavior is the decision processes and acts of people
involved in buying and using products.
2) Purchase decision making pattern that is a complex amalgam of
needs and desires, and is influenced by factors such as the
consumer's (1) societal role (parent, spouse, worker, etc.), (2)
social and cultural environment and norms, and (3) aspirations
and inhibitions.

Examples:-
1) While buying a mobile a person will keep in mind the
requirements from the mobile i.e. for official purpose, listening
music, quality camera, etc. Then need to look for the products
and the companies which satisfy the condition, then look for the
pricing, after consulting every one the final decision is made.
PURCHASE DECISION:-
1) The stage in the customer buying process when the purchase
decision is actually made.
2) It is the aspects which are kept in mind while purchasing a
product. These aspects are the Product choice, brand choice,
dealer choice, purchase amount, purchase timing, payment
method.
3) The consumers preference among the brands in the choice set
and the intention to buy the most preferred brand.
4) Having developed an intention to buy something, the consumer
will (barring interference or unforeseen events) follow through
and make the purchase.
5) Through the evaluation process consumers will reach their final
purchase decision and they reach the final process of going
through the purchase action.

Examples:-
1) While buying a Mobile Phone when all the requirements is
satisfied and the buyer is satisfied with the brand, product,
distributor, payment scheme he /she makes the final decision to
buy a particular mobile.

PURCHASE INTENTION:-
 1) A plan to purchase a particular good or service in the future.

2) Purchase Intentions the likelihood that a consumer will buy a

particular product resulting from the interaction of his or her
need for it, attitude towards it and perceptions of it and of the
company which produces it.
3) A measure of the claimed level of future consumption of a
PRODUCT or service by target customers who almost invariably
overstate their subsequent purchase behavior

Examples:-
1) A consumer who likes the product and would definitely like to
use it has made a purchase intention and would use the product.

SEGMENT POSITIONING
A marketing strategy is based on expected customer behaviour in a
certain market. In order to know the customer and its expected buying
process of segmenting and positioning is needed. These processes are
chronological steps which are dependent on each other- Philip Kotler

SEGMENT PROFITABILITY
Object within Profitability Analysis to which costs and revenues are
assigned. A profitability segment corresponds to a market segment.
You can calculate the profitability of a profitability segment by setting
off its sales revenues against its costs. A profitability segment in an
operating concern is defined by a combination of characteristic- Philip
Kotler

SELECTIVE DE-MARKETING
It is a marketing strategy employed in a condition of overfull demand.
The marketer employs a selective de-marketing of their product. Out
of the various steps, a few of them may be: increasing price, cancelling
all incentives etc.

Examples:
• Due to the high demand of I-phone, selective de-marketing was
employed
• Goa tourism during the time of new year faces the same situation
and
hence adopts this type of marketing.

SELECTIVE DISTRIBUTION
Selective distribution is when the manufacturer relies on more than a
few but all of the intermediaries willing to carry a particular product.
The company does not need to worry about too many outlets; it can
gain adequate market coverage with more control and less cost than
intensive distribution. - Philip Kotler

SELECTIVE SPECIALIZATION
This is a multiple segment strategy also known as a differentiated
strategy. Where the firm decides to target several segments and
develops distinct products/services with separate marketing mix
strategies aimed at the varying groups.
An example of this would be airline companies offering first, business
(segment 1) or economy class tickets (segment 2) , with separate
marketing programmed to attract the different groups.

SELLING CONCEPT

The selling concept, another common business orientation, holds

that consumers and businesses, if left alone, will ordinarily not buy
enough of the organization’s products. The organization must,
therefore, undertake an aggressive selling and promotion effort. This
concept assumes that consumers must be coaxed into buying, so the
company has a battery of selling and promotion tools to stimulate
buying. The selling concept is practiced most aggressively with
unsought goods—goods that buyers normally do not think of buying,
such as insurance and funeral plots. The selling concept is also
practiced in the nonprofit area by fund-raisers, college admissions
offices, and political parties. Most firms practice the selling concept
when they have overcapacity. Their aim is to sell what they make
rather than make what the market wants. In modern industrial
economies, productive capacity has been built up to a point where
most markets are buyer markets (the buyers are dominant) and sellers
have to scramble for customers. Prospects are bombarded with sales
messages. As a result, the public often identifies marketing with hard
selling and advertising. But marketing based on hard selling carries
high risks. It assumes that customers who are coaxed into buying a
product will like it; and if they don’t, that they won’t bad-mouth it or
complain to consumer organizations and will forget their
disappointment and buy it again. These are indefensible assumptions.
In fact, one study showed that dissatisfied customers may bad-mouth
the product to 10 or more acquaintances; bad news travels fast,
something marketers that use hard selling should bear in mind.

SERVICES
• Service is “any act or performance that one party can offer to
another that is essentially intangible and does not result in the
ownership of anything”. - Philip Kotler
• Provision of assistance to customers and clients
Examples
Airtel provides mobile network, internet services to the customer

Blue Dart provide courier services

Taj group of Hotels provide hospitality services

Airlines industry provides transport services

SHOPPER MARKETING

Shopper marketing is a form of marketing which focuses on appealing

to people who are actively in the process of purchasing products. This
differs from marketing targeted at consumers in general to get them
to buy products, although this type of marketing plays a role in
shopper marketing campaigns. Essentially, shopper marketing is
marketing in the purchase environment, whether that is a retail store,
a website, or a wholesaler. Not all companies use shopper marketing
as a tool, but those which do may pursue extensive advertising
campaigns to get their messages out.

E.g.: Frequent flyer scheme for regular user of an airline company.

Membership card by retail stores like shoppers stop, pantaloons to
customer providing benefits at many other outlets in addition to the
discount provided.

SINGLE SEGMENT STRATEGY

A single segment strategy involves the firm choosing its single
preferred market segment and targeting it with a single marketing
mix, aimed at serving the segment as well as possible. This is
generally chosen by a smaller firm, or one which has only located one
attractive market segment. E.g.: Automobile companies like Mercedes,
Audi, and BMW targets the upper segment of the society.

SOCIAL CLASS:

Sociology identified that social stratification is common among many

societies. Social class is a type of stratification. Social classes are
relatively homogeneous and enduring divisions in a society, which are
hierarchically ordered and whose members share similar values,
interests and behaviour.

SOCIAL FACTORS

They include reference groups, family, and roles and statuses of a

person.

Reference groups

Reference groups influence a person’s behaviour directly or indirectly.

Groups having a direct influence on a person are called membership
groups. People are influenced in the consumption and purchase
decisions by groups in which they are members like family, friend
circle, neighbours, co-workers, sports teams etc.

People are also influenced by groups to which they do not belong

presently, but want to belong in course of time. Such groups are called
aspirational groups.

Family

Family members constitute the most influential primary reference

group or membership group. Each person has a family of orientation
that consists of his parents, brothers and sisters. He has a family of
procreation consisting of spouse and children.

Statuses and roles

People choose products that communicate their status in society.

Marketers have to aware of the status symbol potential of products
and brands. Each status has a role or group of activities to be
performed. Persons have multiples statuses in different groups to
which they belong. Therefore the roles have some bearing on the
consumption and purchase decisions.

SOCIO-CULTURAL ENVIRONMENT:

SOCIO-CULTURAL ENVIRONMENT: Purchasing power is directed toward

certain goods and services and away from others according to people's
tastes and preferences. Society shapes the beliefs, values, and norms
that largely define these tastes and preferences. People absorb,
almost unconsciously, a worldview that defines their relationships to
themselves, to others, to organizations, to society, to nature, and to
the universe.

Examples:
• Color of products in Islamic country is dominantly green for eg
Colgate, thumbs up.

• McDonald use yellow colour for the face of its mascot Ronald in south
East Asian country and white across the world as white color
considered as sickness.

• South Asian countries like Thailand uses more vibrant colours as

compared to country like France use subtle shades.

• Phillips launched electric shavers in japan they failed in miserably

because the size of palm of average Japanese is smaller than men
from other nations.

• HMT, moved to countries like Vietnam and Kenya as they have to

modify the size of tractor because average size of farmer is 5ft and 6ft
respectively.

• Shopping trends of various countries are persuaded by festive

seasons for example in
India people tend to shop around dhanteras, Hyderabad-Bangalore
side people shop during ramzan.

SOCIAL MARKETING CONCEPT

Some have questioned whether the marketing concept is an
appropriate philosophy in an age of environmental deterioration,
resource shortages, explosive population growth, world hunger and
poverty, and neglected social services. Are companies that
successfully satisfy consumer wants necessarily acting in the best,
long-run interests of consumers and society? The marketing concept
sidesteps the potential conflicts among consumer wants, consumer
interests, and long-run societal welfare. Yet some firms and industries
are criticized for satisfying consumer wants at society’s expense. Such
situations call for a new term that enlarges the marketing concept. We
propose calling it the societal marketing concept, which holds that
the organization’s task is to determine the needs, wants, and interests
of target markets and to deliver the desired satisfactions more
effectively and efficiently than competitors in a way that preserves or
enhances the consumer’s and the society’s well-being. The societal
marketing concept calls upon marketers to build social and ethical
considerations into their marketing practices. They must balance and
juggle the often conflicting criteria of company profits, consumer want
satisfaction, and public interest. Yet a number of companies have
achieved notable sales and profit gains by adopting and practicing the
societal marketing concept. Some companies practice a form of the
societal marketing concept called causerelated marketing. Pringle and
Thompson define this as “activity by which a company with an image,
product, or service to market builds a relationship or partnership with
a ‘cause,’ or a number of ‘causes,’ for mutual benefit. They see it as
affording an opportunity for companies to enhance their corporate
reputation, raise brand awareness, increase customer loyalty, build
sales, and increase press coverage. They believe that customers will
increasingly look for demonstrations of good corporate citizenship.
Smart companies will respond by adding “higher order” image
attributes than simply rational and emotional benefits. Critics,
however, complain that cause-related marketing might make
consumers feel they have fulfilled their philanthropic duties by buying
products instead of donating to causes directly.

Examples
• Aircel launched ‘save the tiger’ campaign to develop awareness
about saving the tiger

• ITC generates funds for child education by donating Re.1 for each
product sale

• HUL did a Lifebuoy campaign to generate awareness of the

importance of washing hands.

STOCHASTIC MODELLING

A stochastic model would be to set up a projection model which looks

at a single policy, an entire portfolio or an entire company. But rather
than setting investment returns according to their most likely
estimate, for example, the model uses random variations to look at
what investment conditions might be like.
Based on a set of random outcomes, the experience of the
policy/portfolio/company is projected, and the outcome is noted. Then
this is done again with a new set of random variables. In fact, this
process is repeated thousands of times.
At the end, a distribution of outcomes is available which shows not
only the most likely estimate but what ranges are reasonable too. The
most likely estimate is given by the distribution curve's (formally
known as the Probability density function) center of mass which is
typically also the peak(mode) of the curve, but may be different e.g.
for asymmetric distributions.
Examples:
A minimum investment return of 5% per annum. A deterministic
simulation, with varying scenarios for future investment return, does
not provide a good way of estimating the cost of providing this
guarantee. This is because it does not allow for the volatility of
investment returns in each future time period or the chance that an
extreme event in a particular time period leads to an investment
return less than the guarantee.
This is useful when a policy or fund provides a guarantee, e.g
Stochastic modelling builds volatility and variability (randomness) into
the simulation and therefore provides a better representation of real
life from more angles.

STRATEGIC CONTROL

From time to time, companies need to undertake a critical review of

overall marketing goals and effectiveness. Each company should
periodically reassess its strategic approach to the marketplace with
marketing-effectiveness reviews and marketing audits.

➤ The marketing-effectiveness review. Marketing effectiveness is

reflected in the degree to which a company or division exhibits the five
major attributes of a marketing orientation: customer philosophy
(serving customers’ needs and wants), integrated marketing
organization (integrating marketing with other key departments),
adequate marketing information (conducting timely, appropriate
marketing research), strategic orientation (developing formal
marketing plans and strategies), and operational efficiency (using
marketing resources effectively and flexibly). Unfortunately, most
companies and divisions score in the fair-to-good range on measures
of marketing effectiveness.

➤ The marketing audit. Companies that discover marketing

weaknesses should
undertake a marketing audit, a comprehensive, systematic,
independent, and
periodic examination of a company’s (or SBU’s) marketing
environment, objectives,
strategies, and activities to identify problem areas and
opportunities and
recommend a plan of action for improving the company’s
marketing
performance.34 The marketing audit examines six major
marketing components:
(1) the macroenvironment and task environment, (2) marketing
strategy,
 (3) marketing organization, (4) marketing systems, (5) marketing
productivity, and
(6) marketing function (the 4 Ps).

Highly successful companies also perform marketing excellence

reviews and ethicalsocial responsibility reviews to gain an outside-in
perspective on their marketing activities.

➤ The marketing excellence review. This best-practices excellence

review rates a firm’s performance in relation to the best marketing and
business practices of highperforming businesses. The resulting profile
exposes weaknesses and strengths and highlights where the company
might change to become a truly outstanding player in the
marketplace.

➤ The ethical and social responsibility review. In addition,

companies need to evaluate whether they are truly practicing ethical
and socially responsible marketing.
Business success and continually satisfying customers and other
stakeholders are

STRATEGY FORMULATION
Goals indicate what a business unit wants to achieve; strategy
describes the game plan for achieving those goals. Every business
strategy consists of a marketing strategy plus a compatible technology
strategy and sourcing strategy. Although many types of marketing
strategies are available, Michael Porter has condensed them into three
generic types that provide a good starting point for strategic thinking:
overall cost leadership, differentiation, or focus.
➤ Overall cost leadership: Here the business works to achieve the
lowest production and distribution costs so that it can price lower than
competitors and win more market share. Firms pursuing this strategy
must be good at engineering, purchasing, manufacturing, and physical
distribution; they need less skill in marketing. Texas Instruments uses
this strategy. The problem is that rivals may emerge with still lower
costs, hurting a firm that has rested its whole future on cost
leadership.
➤ Differentiation: Here the business concentrates on achieving
superior performance in an important customer benefit area, such as
being the leader in service, quality, style, or technology—but not
leading in all of these things. Intel, for instance, differentiates itself
through leadership in technology, coming out with new
microprocessors at breakneck speed.
➤ Focus: Here the business focuses on one or more narrow market
segments, getting to know these segments intimately and pursuing
either cost leadership or differentiation within the target segment.
Airwalk shoes, for instance, came to fame by focusing on the very
narrow extreme-sports segment.
Firms that do not pursue a clear strategy—“middle-of-the-roaders”—do
the worst. International Harvester fell upon hard times because it did
not stand out as lowest in cost, highest in perceived value, or best in
serving some market segment.
Middle-of-the-roaders try to be good on all strategic dimensions, but
because strategic dimensions require different and often inconsistent
ways of organizing the firm, these firms end up being not particularly
excellent at anything.
Strategy formulation in the age of the Internet is particularly
challenging. The chemical company Solutia, a Monsanto spinoff, copes
by creating four different, possible short-term scenarios for each
strategy. This allows the firm to act quickly when it sees a scenario
unfolding. Sun Microsystems holds a weekly meeting with the firm’s
top decision makers to brainstorm strategies for handling new threats.
By revisiting strategic plans frequently, both companies are able to
stay ahead of environmental changes.
SWOT ANALYSIS

SWOT Analysis – The overall evaluation of a company’s strengths,

weaknesses, opportunities, and threats. It’s a way of monitoring the
external and internal marketing environment.

External Environment Analysis

In general, a business unit has to monitor key macroenvironment
forces (demographic, economic, technological, political-legal, and
social-cultural) and microenvironment actors (customers, competitors,
distributors, and suppliers) that affect its ability to earn profits (see
Chapter 4 for more detail). Then, for each trend or development,
management needs to identify the associated marketing opportunities
and threats. A marketing opportunity is an area of buyer need in
which a company can perform profitably. Opportunities can be
classified according to their attractiveness and their success
probability. The company’s success probability depends on whether its
business strengths not only match the key success requirements for
operating in the target market, but also exceed those of its
competitors. Mere competence does not constitute a competitive
advantage. The best-performing company will be the one that can
generate the greatest customer value and sustain it over time.
An environmental threat is a challenge posed by an unfavorable
external trend or development that would lead, in the absence of
defensive marketing action, to deterioration in sales or profit. Threats
should be classified according to seriousness and probability of
occurrence. Minor threats can be ignored; somewhat more serious
threats must be carefully monitored; and major threats require the
development of contingency plans that spell out changes the company
can make if necessary.

INTERNAL ENVIRONMENT ANALYSIS

It is one thing to discern attractive opportunities and another to have
the competencies to succeed in these opportunities. Thus, each
business needs to periodically evaluate its internal strengths and
weaknesses in marketing, financial, manufacturing, and organizational
competencies. Clearly, the business does not have to correct all of its
weaknesses, nor should it gloat about all of its strengths. The big
question is whether the business should limit itself to those
opportunities in which it possesses the required strengths or consider
better opportunities to acquire or develop certain strengths.
Sometimes a business does poorly because its departments do not
work together well as a team. It is therefore critically important to
assess interdepartmental working relationships as part of the internal
environmental audit. Honeywell, for example, asks each department to
annually rate its own strengths and weaknesses and those of the other
departments with which it interacts. The notion is that each
department is a “supplier” to some departments and a “customer” of
other departments. If one department has weaknesses that hurt its
“internal customers,” Honeywell wants to correct them.

Hero Honda
 Strengths –
• Recognised and established brand name
• Effective advertising capability
• After sales service
• High end Technology
• Low maintenance
• Fuel – efficiency
• Wide distribution network

Weaknesses –
• It is vulnerable to joint venture as Honda Motors has much control
• Brand name ‘Hero’ is itself not close to the automobile industry
• R&D not close to the manufacturing plant

Opportunities –
• Global expansion
• Expansion of target market (including women)

Threats –
• Bajaj is a strong competitor
• Increase in price of petroleum and raw materials

TECHNO-LEGAL FACTOR:

The techno-legal environment is perhaps one of the fastest changing

factors in the macro environment. This includes all developments from
antibiotics and surgery to nuclear missiles and chemical weapons to
automobiles and credit cards. As these markets develop it can create
new markets and new uses for products. It also requires a company to
stay ahead of others and update their own technology as it becomes
outdated.

Example:

• In an ambitious endeavour, Samsung had launched a digital home

business. In Korea, Samsung has 6,000 networked homes that are
outfitted with Internet-enabled ovens, refrigerators, security cameras,
and wall-mounted flat-panel displays. Samsung is looking to take the
idea abroad.

• Left hand side –right hand side drivers

• Cdma card used in japan

• Social security number in usa

• UID no in india

• Blackberry case-messages have to decrypted by government of india

• Fuel-98-99% octane fuel

• Harley Davidson changed engine in india

Information technology (IT) is "the study, design, development,

application, implementation, support or management of computer-
based information systems, particularly software applications and
computer hardware", according to the Information Technology
Association of America (ITAA).[1] IT deals with the use of electronic
computers and computer software to securely convert, store, protect,
process, transmit, input, output, and retrieve information. Innovations
Innovation can be seen as the process that renews something that
exists and not, as is commonly assumed, the introduction of something
new. Discovery is the act of detecting something new. The Internet is a
global system of interconnected computer networks and serves billions
of users worldwide. It is a network of networks that consists of millions
of private, public, academic, business, and government networks, of
local to global scope, that are linked by a broad array of electronic and
optical networking technologies.

Rate of Technology transfer - Technology transfer is the process of

sharing of skills, knowledge, technologies, methods of manufacturing,
samples of manufacturing and facilities among governments and other
institutions to ensure that scientific and technological developments
are accessible to a wider range of users who can then further develop
and exploit the technology into new products, processes, applications,
materials or services. It is closely related to (and may arguably be
considered a subset of knowledge transfer.
Rate of Obsolescence: Obsolescence is the state of a being which
occurs when an object, service or practice is no longer wanted even
though it may still be in good working order.

Obsolescence frequently occurs because a replacement has become

available that is superior in one or more aspects. Obsolete refers to
something that is already disused or discarded, or antiquated.
Typically, obsolescence is preceded by a gradual decline in popularity.

USP

The Unique Selling Proposition (also Unique Selling Point or

USP) is a marketing concept that was first proposed as a theory to
explain a pattern among successful advertising campaigns of the early
1940s. It states that such campaigns made unique propositions to the
customer and that this convinced them to switch brands. The term was
invented by Rosser Reeves of Ted Bates & Company. Today the term is
used in other fields or just casually to refer to any aspect of an object
that differentiates it from similar objects.
A number of businesses and corporations currently use USPs as a basis
for their marketing campaigns.

Some good current examples of products with a clear USP are:

 Head & Shoulders: "You get rid of dandruff"
 Olay: "You get younger-looking skin"

Some unique propositions that were pioneers when they were

introduced:
 Domino's Pizza: "You get fresh, hot pizza delivered to your door in
30 minutes or less -- or it's free."
 FedEx: "When your package absolutely, positively has to get there
overnight"
TOP OF MIND AWARENESS (TOMA)

"When people think of you first to fulfill their product or service needs."

TOMA has traditionally been defined as "the percent of respondents

who, without prompting, name a specific brand or product first when
asked to list all the advertisements they recall seeing in a general
product category over the past 30 days. Companies that are well
known advertise heavily and have attention-getting ads that tend to
receive the highest top of mind awareness scores in ad tracking
studies.

Another definition is, "Owning the space that your product or service
occupies between your prospects' ears. That way, when they're ready
to buy they think of you first."

Another way to explain TOMA is to ask, "Whom do you think of first

when you think of [product/service]?" The answer to that question is
the company that has achieved Top of Mind Awareness with you.
TOMA varies from consumer to consumer.

"Top of Mind Awareness" is a way to measure how well brands rank in

the minds of consumers. Companies that build brand awareness tend
to also rank highly in "Top of Mind Awareness." Thus, TOMA correlates
strongly with market share of a product.

• For companies that conduct high-dollar transactions, Top of Mind

Awareness is particularly important. Mortgage Brokers, Real
Estate Agents, and Auto Dealerships are particularly reliant on
Top of Mind Awareness. However, TOMA holds value for
companies offering products and services of all transaction
levels.
VIRAL MARKETING

Marketing phenomenon that facilitates and encourages people to pass

along a marketing message.

Viral marketing depends on a high pass-along rate from person to

person. If a large percentage of recipients forward something to a
large number of friends, the overall growth snowballs very quickly. If
the pass-along numbers get too low, the overall growth quickly fizzles.

Viral marketing and viral advertising, (buzzwords), refer to marketing

techniques that use pre-existing social networks to produce increases
in brand awareness or to achieve other marketing objectives (such as
product sales) through self-replicating viral processes, analogous to
the spread of virus or computer viruses. It can be word-of-mouth
delivered or enhanced by the network effects of the Internet.[1] Viral
promotions may take the form of video clips, interactive Flash games,
advergames, ebooks, brandable software, images, or even text
messages.

• On July 14 2010, Old Spice launched the fastest growing online

viral video campaign ever, garnering 6.7 million views after 24
hours, ballooning over 23 million views after 36 hours[21]. Old
Spice's agency created a bathroom set in Portland, OR and had
their TV commercial star, Isaiah Mustafa, reply to 186 online
comments and questions from websites like Twitter, Facebook,
Reddit, Digg, Youtube and others. The campaign ran for 3 days.
• Between December 2009 and March 2010 a series of seven
videos were posted to YouTube under the name
"iamamiwhoami" leading to speculation that they were a
marketing campaign for a musician. In March 2010, an
anonymous package was sent to an MTV journalist claiming to
contain a code which if cracked would give the identity of the
artist. The seventh video, entitled 'b', appears to feature the
Swedish singer Jonna Lee
VALUE PRICING

Value pricing is a method in which the company charges a fairly low

price for a high quality offering. Value pricing says that the price
should represent a high-value offer to consumers. This is a major trend
in the computer industry, which has shifted from charging top dollar
for cutting-edge computers to offering basic computers at lower prices.
For instance, Monorail Computer started selling PCs in 1996 for as little
as $999 to woo price-sensitive buyers. Compaq and others quickly
followed suit. More recently, eMachines began selling its PCs for less
than $500 without a monitor, targeting the 55 percent of computerless
households with annual incomes of $25,000 to $30,000.13

Value pricing is not a matter of simply setting lower prices on one’s

products compared to those of competitors. It is a matter of
reengineering the company’s operations to become a low-cost
producer without sacrificing quality, and lowering prices significantly to
attract a large number of value-conscious customers. An important
type of value pricing is everyday low pricing (EDLP), which takes place
at the retail level.

Retailers such as Wal-Mart and Amazon.com use EDLP pricing, posting

a constant, everyday low price with few or no temporary price
discounts. These constant prices eliminate week-to-week price
uncertainty and can be contrasted to the “high-low” pricing of
promotion-oriented competitors. In high-low pricing, the retailer
charges higher prices on an everyday basis but then runs frequent
promotions in which prices are temporarily lowered below the EDLP
level.

Retailers adopt EDLP for a number of reasons, the most important of

which is that constant sales and promotions are costly and erode
consumer confidence in the credibility of everyday prices. Consumers
also have less time and patience for such time-honored traditions as
watching for specials and clipping coupons. Yet promotions are an
excellent way to create excitement and draw shoppers. For this
reason, EDLP is not a guarantee of success. As supermarkets face
heightened competition from store rivals and alternative channels,
many are drawing shoppers using a combination of high-low and EDLP
strategies, with increased advertising and promotions.
WORD OF MOUTH MARKETING

According to the Word-of-mouth Marketing Association this is defined

as “giving people a reason to talk about your products and services,
and making it easier for that conversation to take place. It is the art
and science of building active, mutually beneficial consumer-to-
consumer and consumer-to-marketer communications.

Word of mouth is a reference to the passing of information from

person to person. Originally the term referred specifically to oral
communication (literally words from the mouth), but now includes any
type of human communication, such as face-to-face, telephone, email,
and text messaging.

Grewal, R., T.W. Cline, and A. Davies, 2003. Early-Entrant Advantage

An unpaid form of promotion in which satisfied customers tell other

people how much they like a business, product or service.

Word of Mouth Marketing (also called Online Endorsement Marketing)

is a marketing strategy which uses the person-to-person
communication of satisfied customers to raise awareness of an
organization’s products and services and generate sales.

George Silverman, How to Trigger Exponential Sales Through Runaway

Word of Mouth