Q.1 What is product mix? What are the strategies involved in product mix and product line?

(10 marks) Answer Product mix The number of individual products produced or sold by an organization. The mix is defined by the industry and manufacturing environment, and management strategies that position the company as a specialty, niche or broadbased supplier of goods and services. Instances where the product mix varies widely from period to period often requires more investment in facilities and inventory, and may result in lower levels of customer service. It is extremely important for any organization to have a well-managed product mix. Most organizations break down managing the product mix, product line, and actual product into three different levels. Strategies involved in product mix and product line Product-mix decisions are concerned with the combination of product lines offered by the company. Management of the companies' product mix is the responsibility of top management. Some basic product-mix decisions include: 1.reviewing the mix of existing product lines; 2.adding new lines to and deleting existing lines from the product mix; 3.determining the relative emphasis on new versus existing product lines in the mix; 4.determining the appropriate emphasis on internal development versus external acquisition in the product mix; 5.gauging the effects of adding or deleting a product line in relationship to other lines in the product mix; and 6.forecasting the effects of future external change on the company's product mix. Product-line decisions are concerned with the combination of individual products offered within a given line. The product-line manager supervises several product managers who are responsible for individual products in the line. Decisions about a product line are usually incorporated into a marketing plan at the divisional level. Such a plan specifies changes in the product lines and allocations to products in each line.

and recommended distribution strategy Managing the product mix for a company is very demanding and requires constant attention. trade discounts. Also called channel of distribution or marketing channel.considering expansion of a given product line. The plan for an existing product would focus on any changes in the marketing strategy. These decisions are the responsibility of a brand manager (sometimes called a product manager). product characteristics. (10 marks) Answer Distribution channel A path through which goods and services flow in one direction (from vendor to the consumer).allocating resources to individual products in the line on the basis of marketing strategies recommended by product managers. A marketing channel can be as short as being direct from the vendor to the consumer or may include several interconnected intermediaries such as wholesalers. Decisions regarding the marketing mix for a brand are represented in the product's marketing plan. . 2. product-line managers have the following responsibilities: 1. Top management must provide accurate and timely analysis (BCG) of their company's product mix so the appropriate adjustments can be made to the product line and individual products. 3. The plan for a new brand would specify price level.Generally. distribution facilities. Each intermediary receives the item at one pricing point and moves it to the next higher pricing point until it reaches the final buyer.considering candidates for deletion from the product line. price level. Some of these changes might include the product's target market. coupons.evaluating the effects of product additions and deletions on the profitability of other items in the line. advertising expenditures for the coming year. Decisions at the first level of product management involve the marketing mix for an individual brand/product. Q. and 4. agents. distributors. advertising and promotional expenditures. and the payments generated by them that flow in the opposite direction (from consumer to the vendor).2 What is a distribution channel? Explain the factors to be considered while setting up a distribution channel. and a five-year statement of projected sales and earnings. retailers.

which the producer must take into account.Understanding consumer needs and criteria for buying Channel Availability . Factors to be considered for setting up Distribution channel The selection of distribution is affected by many of factors. before it finally reaches the consumer or end-user. It may include the buying pattern of consumer.Distribution is also a very important component of Logistics & Supply chain management. or retailer to end customer. each passing the product down the chain to the next organization.. or auto mobile. buying habit of customers. type of the product is perishable.If company objective is to have mass appeal and rapid market penetration. It is defined as a chain of intermediaries. supplier to retailer. Organization objectives . which play significant role while choosing the channel for distribution.Channels may not be available and other factors like Customer Characteristics Product Attributes Type of Organization Competition Marketing Environmental Forces and Characteristics of Intermediaries Channels A number of alternate 'channels' of distribution may be available: . FMCG goods should have a wide reaching.company may chose it's existing channel of distribution for relative product. type of product . This process is known as the 'distribution chain' or the 'channel. It can be factory to supplier. Distribution in supply chain management refers to the distribution of a good from one business to another. intensive distribution channel. existing channel for comparable product. nature and extent of market. weight and bulk and it also depends on the company's resources. along with those of the all-important end-user.' Each of the elements in these chains will have their own specific needs.Distribution to consumer market or industrial markets would be different channel structures.Perishable products should have a short distribution channel. The main affecting factors are following.

process of transfer the products or services from Producer to Customer or end user. except by mail order. Outlets such as estate agencies and building society offices are crowding out traditional grocers from major shopping areas. Yet that distribution chain is merely assuming a part of the supplier's responsibility. most consumer goods manufacturers could never justify the cost of selling direct to their consumers. links now exist between airlines. tour operators.Distributor. There has also been some evidence of service integration. Retailer (also called dealer or reseller). Channel strategy Gravity & adventure Push and Pull strategy Product (or service) Cost Consumer location Managerial concerns The channel decision is very important. since both direct and indirect channels may be used. who sells to end customers Advertisement typically used for consumption goods Distribution channels may not be restricted to physical products alice from producer to consumer in certain sectors. Channel decisions Channel Sales is nothing but a chain for to market a product through different sources. In theory at least. for example. may sell their services (typically rooms) directly or through travel agents. Many suppliers seem to assume that once their product has been sold into the channel. etc. There have also been some innovations in the distribution of services. if they have any aspirations to be market-oriented. centralized reservation systems. particularly in the travel and tourism sectors. and.the latter offering anything from televisions through tools. there has been a significant increase in retail outlets for the service sector. For example. there is a form of trade-off: the cost of using intermediaries to achieve wider distribution is supposedly lower. In addition. For example. into the beginning of the distribution chain. Indeed. their job should really be . there has been an increase in franchising and in rental services . Hotels. tourist boards. with services linking together. hotels and car rental services. their job is finished. who sells to retailers. airlines.

development communication can be defined as the use of communication to promote development.3 Discuss the communication development process with examples. Role of a development communicator The development communicator plays a very significant role in explaining the development process to the common people in such a way that it finds acceptance. Development is about change.It is not easy to define this as it depends on the context. When we refer to development communication. It is about using communication to change or improve something. until the product or service arrives with the end-user. we refer to various types of communication like interpersonal. in the context of development. These messages are designed to transform the behaviour of people or for improving their quality of life. Therefore. It is about changing for the better.extended to managing all the processes involved in that chain. Development. should possess knowledge in professional techniques and should know the audience. Here we use different types of messages to change the socio-economic condition of people. When we refer to communication. It could be about social or economic change for improvement or progress. Communication is a message understood or sharing of experience. Those who write or produce programmes on issues related to development are called development communicators. it is about such communication that can be used for development. In order to achieve this objective a development communicator: has to understand the process of development and communication. This may involve a number of decisions on the part of the supplier: Channel membership Channel motivation Monitoring and managing channels Q. you see that there are two words-‘development’ and ‘communication’. prepare and distribute development messages to millions of people in such a . (10 marks) Answer In ‘development communication’. group and mass communication.

During the 1950s. it was concentrating only on programmes on agriculture. it was the newspapers which gave great importance to development themes. Such forms of media are participatory and effective. The programmes may be about farming and related subjects. You may have seen construction workers cooking their meal of dal and rice over open fires in front of their tents set up temporarily on the roadside. People who present these programmes speak in a language or dialect that the people in your area speak. Madhya Pradesh. DEVELOPMENT COMMUNICATION USING VARIOUS MEDIA The history of development communication in India can be traced to rural radio broadcasts in the 1940s in different languages. the programmes on education and development were made available to 2400 villages in the states of Andhra Pradesh. There would also be programmes on related fields. when India used satellites for telecasting television programmes in what is known as SITE (Satellite Instructional Television Experiment). Karnataka. Have you ever heard a rural programme on radio? If you come from a rural area. Later in 1975.In fact. If they accept this challenge they will be able to get the people to identify themselves as part of a society and a nation. the government started huge developmental programmes throughout the country. However. They need to be educated about the values of balanced nutrition. when Doordarshan started on 15th September 1959. cleanliness. As far as the print media is concerned. This identity will help in bringing human resources together for the total welfare of the individual and the community at large. traditional media are the closest to people who need messages of development like the farmers and workers. availability of improved seeds and implements. the electronic media – radio and television especially All India Radio and Doordarshan have spread messages on development as the main part of their broadcasts. They wrote on various government development programmes and how the people could make use of them. accepted and applied. amongst all the media that are used for development communication. you probably would have heard.way that they are received and understood. If the print media have contributed to development communication. folk songs and information about weather. officials and farmers. Bihar. hygiene . after Independence when the Five Year Plans were initiated by the government for planned development. Orissa and Rajasthan. Many of you might have seen the ‘Krishi Darshan’ programme on Doordarshan. The programme may comprise of interviews with experts. market rates.

The content for the skits is drawn from the audience’s life. Information on sensitive health issues such as HIV/AIDS has been communicated throught the medium of comics in several states. in order to achieve the desired results. For example. This means supplementing their staple diet of dal and rice with green leafy vegetables known to cure night blindness. hygiene etc. How can people be taught new skills at a low cost? What would be a good way to deal with sensitive topics such as health issues? How can complicated new research. they are told about “balanced nutrition” . Rajasthan. Tamilnadu. The important thing about comics is that they are made by people on their own issues in their own language. groups of volunteers use street theatre as a medium for development communication. you must understand that development communication using various media is possible only with the active involvement of the following: (i) Development agencies like departments of agriculture. So. and the North East to provide training to rural communicators to enable them to use comics in development communication. are enacted. Programmes are organized in the remote areas of Jharkhand. In various parts of India. Comics involve story telling using visuals which must follow local ideas and culture in order to be understood correctly by people. like that in agriculture for example. problems in communicating a message in an effective way has been a matter of concern to development workers. But. readers find them closer to their day-to-day lives. female construction workers and their children are taught how to read and write.and water and sanitation. (ii) Voluntary organizations (iii) Concerned citizens (iv) Non governmental organizations (NGOs) Examples One of the first examples of development communication was Farm Radio . these comics should be created locally. an ailment common among construction workers. be simplified so that ordinary people can benefit? One option has been the use of comics. However. But what are ‘comics’ ? You must have all at some point of time read a comic. This is done through humorous skits and plays through which the importance of literacy. Similarly. However.

This model of adult education or distance education was later adopted in India and Ghana. The comic books are in Albanian and feature Superman and Wonder Woman. on the job training.C. providing monthly workshops. But the Forums also dealt with social and economic issues. values. when smaller Asian vendors started making their presence felt with better products at lower prices. The aim is to teach children what to do when they find an unexploded land mine left over from Kosovo's civil war. and additional programs on a country by country basis.000 comic books to children affected by the Kosovo War. benefits. has operated long term projects in Ghana. Q. Liberia. Journalists for Human Rights. jhr works directly with journalists. and the DR Congo. . At first this was a response to the Great Depression and the need for increased food production in World War II. From 1941 to 1965 farmers met in groups each week to listen to special radio programs. (10 marks) Answer Abstract In the late 1990s. Select any mobile handset and mobile company and then evaluate its positioning strengths or weakness in terms of attributes. Since 2002. In spite of the 1997 Ottawa Treaty which attempts to ban land mines they continue to kill or injure 20.000 civilians each year around the world. Government and D. but it suddenly came under threat in 2003-2004. brand name and brand equity. Nokia's dominance continued into the first few years of the 2000s.4. a Canadian based NGO. Comics planned to distribute 600. The comic books instruct children not to touch the antipersonnel mines and not to move. In 1999 the U. Nokia overtook then leader Motorola to emerge as a behemoth in the global mobile phone industry. but instead to call an adult for help.S.Forums in Canada. student sessions. There were also printed materials and prepared questions to encourage group discussion. Sierra Leone.

" . To analyze the effect of changing market conditions on companies. So much so that when the company announced poor . with sales and earnings falling below expected levels.2 Positive Signs The announcement of Nokia Corporation's (Nokia) quarterly results in April 2005 was a much awaited event as far as the global mobile phone industry was concerned. in 2005." Jack Gold. in mid 2004.The company's problems also had internal causes and analysts said one of the reasons could be that it had become too complacent with its success and lost its agility in reading and responding to market signals. It also discusses the efforts Nokia made to recover its market once it realized that its performance was slipping. This case study discusses the various problems Nokia faced in 2003-2004.1 "Nokia didn't have the coolness factor. Coolness in the consumer space is a big deal. To appreciate the importance of innovation in a dynamic and volatile industry. The company. had run into rough weather in 2003-2004.Jorma Ollila. and they were stodgy. including the company's tardiness in introducing the clamshell phones that had become very popular and its resistance to manufacturing operator specific handsets. vice president of Meta Group. and they didn't push them. To examine future challenges that the company faced and the various options available to it We want to be the company that brings this industry to the next phase. And if we have a little bit of a bump in the road in 2004. CEO of Nokia. they were a little late with cameras. which had emerged as an industry leader in the late 1990s. Issues: To understand the difficulties faced by an erstwhile giant in the global mobile phone industry in 2003-2004. a Connecticut-based technology consulting firm. that's immaterial. They didn't really do flip phones. The case concludes with an analysis of the challenges the company faced in the future and the various options ahead of it. To appreciate the importance of keeping abreast with changing market conditions and adapting to them speedily.

who was a mining . "Nokia's result was definitely better than expected. Background Despite the relatively recent emergence of the mobile phone industry globally.65 billion.Commenting on Nokia's improved performance. It introduced several new models. The company announced satisfactory results for the fourth quarter of 2004 and market share for the year 2004 also stabilized at 32 percent by the end of the year. Nokia's sales increased 17 percent over the corresponding quarter of the previous year to $9. However. ending March 31. several analysts wondered whether Nokia would ever be able to dominate the industry as it did in the late 1990s and the first two years of the new century. despite these positive signs.1 billion. Nokia's efforts started paying off by late 2004. Nokia's company history goes back to the 1800s. Jussi Hyoty (Hyoty). The company put up a tough fight over the second half of 2004 to recapture its lost position in the market. an analyst at securities firm FIM Securities. and it shows that it's a growth company again.results in the first quarter of 2004. Ollila's prediction came true when the company announced better than expected results for the first quarter of 2005. In the first quarter of 2005."3 However. prompting Nokia to increase its estimate of the size of the global handset market in 2005 by 100 million to 740 million. which had fallen to a low of around 28 percent in early 2004 from an average of 35 percent over the previous three years. Nokia was not ready to throw in the towel quite so easily. modified designs. declared that the company was poised to recover in 2005. especially in light of the aggressive competition posed by several new Asian companies as well as more established players like Motorola and Sony Ericsson. Net profit rose 18 percent to $1. The company was first set up on the banks of the river Nokia (after which it was named) in southwestern Finland in 1865 by Fredrik Idestam. Global handset sales rose 11 percent. several analysts declared that it was the beginning of the end of Nokia's dominance in the industry. and aggressively promoted products with a view to increasing its market share. while acknowledging that 2004 had been a challenging year. Nokia's CEO. said. Jorma Ollila (Ollila).

(FRW) to manufacture rubber and associated chemicals. mobile phones were bulky. Excerpts The Rise to the Top Nokia drew on its experience of setting up Nordic cellular networks (which were more advanced than those used by Japan. Nokia overtook Motorola to become the largest mobile manufacturer in the world. Designed for Innovation Nokia was the first mobile phone manufacturer to realize in the late 1990s that phones no longer played only a functional role. These three companies had business dealings with each other through the early 1900s and eventually merged in 1967 to form the Nokia Corporation. rubber. an engineer. Nokia was also one of the first mobile manufacturers to realize the importance of the design element in mobile phones and its phones were more aesthetically designed than those of competitors. The company was listed on the New York Stock Exchange in 1994. Manufacturers emphasized functionality over aesthetic appeal. In 1998. In 1898. and J. bricklike devices with an external antenna and a standard keypad. it risks .. The new company had four major businesses . cable and electronics. set up the Finnish Rubber Works Ltd. and the US at that time) to successfully adopt the GSM standard. an engineer.forestry.engineer. In 1912. Carl Henrik Lampen. The Decline In mid-2004. The Economist wrote. the rest of Europe. Over the 1990s... especially one that is driven by constant technological advances. By 1980. Segerberg. Nokia broke new ground in 1999. set up the Finnish Cable Works (FCW) to manufacture electrical cables for lighting purposes. Konstantin Wikstrom.E. a shopkeeper. they were also becoming fashion symbols. "When a firm dominates its market. The original Nokia was a forest industry enterprise that primarily manufactured paper. Until Nokia began emphasizing the design aspect. Nokia was a large business conglomerate with several businesses ranging from tires to televisions and computers to telecommunications. when it launched its 8200 handset on the catwalk at a Paris fashion week.. Nokia became one of the most successful mobile phone manufacturers in the world and began to enter non-Scandinavian markets as well.

. its supporters said the company's inherent strengths and stable financial position would help it sail through the difficulties it had faced in 2003-2004 to recover in the future. most of them agreed that the mobile phone industry was undergoing a vast change. mobile phones were expected to perform a variety of functions in addition to looking stylish and being easy to operate. Efforts at Recovery Soon after announcing disappointing results in the first quarter of 2004.becoming so fixated with trying to ward off what it reckons to be its most powerful challenger that it leaves itself vulnerable to attack from other directions. While the company's detractors believed that Nokia had lost its competitive advantage in the mobile phone market. In the early 2000s. the 6630. The company not only cut prices on certain handsets to increase market share.. and two low end models. the low end 1100 model for emerging markets and the 6230 mid range model became very popular in 2004. another clamshell. . Microsoft Corp (Microsoft) announced its decision to enter the mobile phones market. It killed some outmoded models and brought forward the launch of several others. designed for 3G networks. out of which three were clamshells. a clamshell whose cover not only flipped open but also swiveled. In the early 2000s. For instance. the opinions of analysts on its turnaround were mixed."Analysts said this statement accurately characterized what happened with Nokia. Nokia's new models were the 6260 model. Nokia realized that it was in trouble and began to take steps to correct matters. A Challenging FutureDespite Nokia's laudable efforts in the direction of recapturing its lost market position. However. Nokia's competitors had understood this and were in the process of launching several models that were style statements in themselves. which Nokia claimed was the world's smallest camera phone. Nokia was not able to meet the demand)... including a number of clamshell phones. but also fine-tuned its portfolio to adjust products to meet market needs.. (The 6230 was so popular in some markets that at times. the 2650 and 2600. Nokia launched five new models of phones. the 6170.. The announcement set alarm bells ringing in Nokia as Microsoft had the reputation of being an aggressive competitor. In June 2004. Several other models were also marketed aggressively.

such as a department store.warehouses that offer low-cost. (10 marks) Answer Retailing Retail consists of the sale of goods or merchandise from a fixed location.these offer extremely low-cost goods. and then sells smaller quantities to the end-user. Retail establishments are often called shops or stores.tend to offer a wide array of products and services.sell mostly food products. with limited selection. The range of products are very selective and few in numbers. or by mail. warehouse clubs charge a membership fee. high-end retailers focusing on wealthy individuals). often bear a resemblance to a collection of specialty stores.very large stores offering a huge assortment of "soft" and "hard goods. often high-quantity goods piled on pallets or steel shelves. 5 What is retailing? Explain the functions and different types of retailing with its key features. They offer considerable customer service. Types of retailers by marketing strategy: Department stores . The term "retailer" is also applied where a service provider services the needs of a large number of individuals. boutique or kiosk. Mom-And-Pop (or Kirana Stores as they call them in India): is a retail outlet that is owned and operated by individuals. such as a public utility. a "retailer" buys goods or products in large quantities from manufacturers or importers. either directly or through a wholesaler.[1] Retailing may include subordinated services. Manufacturing marketers see the process of retailing as a necessary part of their overall distribution strategy. Variety stores or "dollar stores" . Warehouse stores . A retailer of such store carries variety of categories and has broad assortment at average price. like electric power.g. Supermarkets . Discount stores . such as delivery. in small or individual lots for direct consumption by the purchaser. Purchasers may be individuals or businesses. In commerce. Normally retailers sell less fashion-oriented brands.Exhibits Exhibit I: The Phone Feature of N-Gage Q.retailers that aim at one particular segment (e.. Demographic . Retailers are at the end of the supply chain. These stores are seen in local community often . but they compete mainly on price offers extensive assortment of merchandise at affordable and cut-rate prices.

Example: Sigma mall and Garuda mall in Bangalore. Tata Croma. branded stores also come under this format. Example: Amazon and Ebay. Vending Machines: This is an automated piece of equipment wherein customers can drop in the money in machine and acquire the products. This store is ideal for emergency and immediate purchases. They provide limited amount of merchandise at more than average prices with a speedy checkout. However. The supermarkets can be anywhere between 20.a rural store that supplies the main needs for the local community.000-40. Some stores take a no frills approach. Malls: has a range of retail shops at a single outlet. For example if a customer visits a Reebok or Gap store then they find just Reebok and Gap products in the respective stores. They accept the payment for the product but the customer receives the product directly from the manufacturer or a wholesaler. They endow with products. However it is important for the customer to be wary about defective products and non secure credit card transaction. This format is ideal for customers who do not want to travel to retail stores and are interested in home shopping. Hypermarkets: provides variety and huge volumes of exclusive merchandise at low margins. The operating cost is comparatively less than other retail formats. For example: Soft drinks vending at Bangalore Airport. such as electronics. E-tailers: The customer can shop and order through internet and the merchandise are dropped at the customer's doorstep. Convenience stores: is essentially found in residential areas.are family-run businesses. food and entertainment under a roof. For few categories. Other retail format stores are forced to reduce the prices if a category specialist retail store is present in the vicinity. Example: SPAR™ supermarket. the products are displayed at the centre of the store and sales person will be available to address customer queries and give suggestions when required. while others are "mid-range" or "high . For example: Pai Electronics™ store in Bangalore. The square feet area of the store depends on the store holder. A classic example is the Metro™ in Bangalore. Specialty stores: A typical speciality store gives attention to a particular category and provides high level of service to the customers. Express Avenue in Chennai. They may adopt a Hi-Lo or an EDLP strategy for pricing. Supermarkets: is a self service store consisting mainly of grocery and limited products on non food items. Here the retailers use drop shipping technique.000 square feet. General store . A pet store that specializes in selling dog food would be regarded as a specialty store. Category killers or Category Specialist: By supplying wide assortment in a single category for lower prices a retailer can "kill" that category for other retailers.

lifestyle and purchase behaviour. robotic kiosks located in airports.a small store often with extended hours. sizes and brands from just one location. 15. If each manufacturer had a separate store for its own products. while a . malls and grocery stores. Convenience store . Final consumers. General store . typically in a rural area. In this context. Westside provides clothing and accessories. storage. Examples include ZoomShops and Redbox. suppliers and consumers. advertising and certain additional services. Retailers are able to balance the demands of both sides. prefer a large variety of goods and services to choose from and usually buy them in small quantities. Sorting Manufacturers usually make one or a variety of products and would like to sell their entire inventory to a few buyers to redu7ce costs. Through this process.a store which sells most goods needed. on and average. discount. Other types of retail store include: Automated Retail stores are self service. Retailers can opt for a format as each provides different retail mix to its customers based on their customer demographics. by collection an assortment of goods from different sources. holding stock. Supermarkets in the US offer. The above process is referred to as the sorting process. wholesalers. retailers undertake activities and perform functions that add to the value of the products and services sold to the consumer. Functions of Retailing Retailers play a significant role as a conduit between manufacturers. as a channel of communication. customers would have to visit several stores to complete their shopping. in contrast. they specialize in types of assortment offered and the market to which the offering is made.end". While all retailers offer an assortment. general merchandise. breaking bulk. Big-box stores encompass larger department. they perform various functions like sorting. buying them in sufficiently large quantities and selling them to consumers in small units. The stores accept credit cards and are usually open 24/7.000 different items from 500 companies. stocking everyday or roadside items. and warehouse stores. Customers are able to choose from a wide range of designs. A good format will lend a hand to display products well and entice the target customers to spawn sales. depending on what income level they target.

Retailers fill orders. Retailers also offer credit and hire-purchase facilities to the customers to enable them to buy a product now and pay for it later. Channel of Communication Retailers also act as the channel of communication and information between the wholesalers or suppliers and the consumers. It helps to keep prices stable and enables the manufacturer to regulate production. . after-sales service and dealing with consumer complaints are some of the services that add value to the actual product at the retailers’ end. To reduce transportation costs. meaning ‘to cut a piece off’. Manufacturers. which are then tailored by the retailers into smaller quantities to meet individual consumption needs. salespeople and display. Additional Services Retailers ease the change in ownership of merchandise by providing services that make it convenient to buy and use products. shoppers learn about the characteristics and features of a product or services offered. learn of sales forecasts.chain like Nilgiris specializes in food and bakery items. Breaking Bulk Breaking bulk is another function performed by retailing. deliver and install products. The display itself allows the consumer to see and test products before actual purchase. Retail essentially completes transactions with customers. Providing product guarantees. while Pantaloons is targeted at the middle class. and customer complaints. Salespeople are also employed by retailers to answer queries and provide additional information about the displayed products. The word retailing is derived from the French word retailer. manufacturers and wholesalers typically ship large cartons of the product. Shoppers’ Stop targets the elite urban class. Consumers can keep a small stock of products at home as they know that this can be replenished by the retailer and can save on inventory carrying costs. The manufacturer can then modify defective or unsatisfactory merchandise and services. delivery delays. Retailers maintain an inventory that allows for instant availability of the product to the consumers. in their turn. promptly process. From advertisements. Holding Stock Retailers also offer the service of holding stock for the manufacturers.

. The number of functions performed by a particular retailer has a direct relation to the percentage and volume of sales needed to cover both their costs and profits. storage. advertising and pre-payment of merchandise. This also works the other way round in case the number of retailers is small.Transport and Advertising Functions Small manufacturers can use retailers to provide assistance with transport.

as part of brand development a firm may initiate a new advertising campaign that includes free samples. What is CRM? What are its objectives? (2 marks) b. . The main areas of focus are as the name suggests: customer . sales. but thinking about CRM in primarily technological terms is a mistake. marketing effectiveness. and the management of relationship and the main objectives to implement CRM in the business strategy are: • • • • • To simplify marketing and sales process To make call centers more efficient To provide better customer service To discover new customers and increase customer revenue To cross sell products more effectively The CRM processes should fully support the basic steps of customer life cycle . There are many technological components to CRM. enables the company to analyze the behavior of customers and their value. Write a short note on Brand development.Q. For example. the technology. (8 marks) Answer CRM stands for Customer Relationship Management. It is a process or methodology used to learn more about customers’ needs and behaviors in order to develop stronger relationships with them. CRM helps businesses use technology and human resources to gain insight into the behavior of customers and the value of those customers. 6 a. responsiveness and market trends. The basic steps are: • • • • Attracting present and new customers Acquiring new customers Serving the customers Finally. along with human resources of the company. retaining the customers Brand development A plan to improve the performance of a particular product or service. Objectives of CRM CRM. relationship . The more useful way to think about CRM is as a process that will help bring together lots of pieces of information about customers.