Marketing

B.COM F.Y.

Definition And Meaning Of Marketing A market is the set of actual and potential buyers of a product. It is a place where potential customers have willingness as well as purchasing power to buy a particular commodity. The essence of market is existence of buyers and sellers. The essential of effective buying and selling are 1. Continuous contact between the buyer and the seller 2. Willingness of both the parties to transfer the ownership of goods. Importance of Market Market brings buyers and sellers together either directly or indirectly. Markets make competition possible. ( Due to many buyers and many sellers) Markets keep buyers well informed. ( From sellers , through advertising) Market provide continuous demand products. ( Provide outlets for the goods produced by producers) Markets make transferability of ownership rights in goods easier ( Legal formalities required to be completed for transfer of ownership rights of goods ) Markets encourage use of financial instruments like post dated cheques , demand drafts etc Markets induce use of modern & latest means of communication & transport. This give the boost to development of railways , roads, etc. Marketing Marketing is the performance of business activities that direct flow of goods and services from producer to consumer or user. A human activity directed at satisfying needs and wants through exchange process.

 A social and managerial process by which individuals and groups obtain what they need and want through creating and exchanging products and value with others.

Concept of Marketing
Exchange Concept : This concept states Marketing as Exchange between buyer and seller. Other aspects of marketing are neglected in this concept. Production Concept : This concept states Marketing means producing the goods in large quantities at less cost of production. Customer would buy product which is available in large quantity at low price. Quality of goods is neglected in this concept. Product Concept : It states that more no. of customers can be captured by offering them excellent quality goods of new variety. Quality assurance is very important. Such organizations spend huge amount on R & D. But many organizations fail due to ignorance of likes and dislikes of the consumers. Sales Concept : This concept believes that no sales of goods is possible without sales promotion efforts. ( Advertising, Personal Selling, Sales Promotion ) Marketing Concept : This concept holds that the marketing is having proper understanding about the needs of customers and satisfaction of those needs properly. Business should be customer oriented and not product oriented. Social Concept : According to this concept , while earning profits and achieving consumers satisfaction, social interest should also be kept in mind. Therefore marketing is a combination of many functions which result into transfer of goods from seller to buyer. Functions of Marketing

1.Functions of Exchange Buying Selling Assembling 2.Functions of Physical Supply Transportation Storage 3.Facilitation Function Financing Risk Bearing Market Information Market Research Standardization Grading Packaging Labeling 1.Buying : A customer receives goods from Seller in exchange of money Factors involved in buying , Quantity Quality Price Terms of Delivery Sources of Supply ( From whom to buy) (Buying by inspection , by description, by grade) Importance of Buying It facilitates reselling ( Many times seller buy goods from a middleman for reselling purpose.) It ensures regular supply It facilitates price determination 2.Selling Selling is possible due to customers Transfer of title of goods in exchange of money

Important for seller to identify the exact needs of the customers and fulfill it Important elements of selling Planning Customer contacts Generation of demand Terms and conditions of selling 3.Assembling Process of collecting the goods from different sources of supply at some convenient place for storage & for further processing or distribution. e.g. Assembling of Agricultural goods like food grains, fruits, vegetables etc When these goods are assembled at one place on large scale. Standardization and grading of these goods become possible. e.g. Assembling of Industrial goods Assembling various parts of product to make a finished product. e.g. Assembling of Raw Material Features of Assembling Involves collection as well as storage of goods It makes further activities like standardization, grading , packing possible. It takes place at central market place Its the function carried out by middlemen like Wholesalers. Importance of Assembling Large orders Wide markets ( Goods can be sold at local , regional , national or international level) Regular supply Fair prices Raising finance ( Assembled goods can be offered as security against loans) Marketing functions ( Assembling makes possible further marketing functions like standardization, grading , packing . Storage facility 4.Standardization A standard is a measure generally recognized as a model for comparison A standard is a norm or criteria to measure quality of product.

Process of determining certain standards of physical and other properties of goods or products and maintaining those standards. Quality of a product can be judged on the basis of various norms like color, , shape, size, flavor, weight, taste, purity, strength, etc. E.g. TV will be standardized on the basis of Audio quality, Picture quality, Size of screen etc Features of Standardization Marketing function which decides acceptable levels of various physical qualities existing in product It is carried out by experts It facilitates grading of the goods It provides a base for price fixation It assures a certain level of quality in the goods Done for agrl. As well as manufactured goods Importance of Standardization Comparison Creates customer confidence Facilitate quick turnover as they are uniform in quality & hence preferred by customers. Makes product competitive Helps to raise finance from banks 5.Grading Grading is the act of separating the goods according to the established specifications including size, weight or quality Grading follows standardization Once the norms for quality ( i.e. standards ) are determined the available stock of goods is divided into various lots as per the standards.. e.g. Available stock of mangoes can be divided into different groups as per their color , smell, weight, size etc Such physical classification of the goods is called as Grading. Grading is the process of sorting the available quantity of products into various groups on the basis of the standards. Without standardizing, Grading is impossible

Grading begins where standardization ends Due to grading seller can offer superior and inferior quality goods separately and can also fix prices accordingly. E.G Agrl. Goods Features of Grading Grouping the goods as per the decided standards Conducted after standardization It is done basically for agrl .products Can be carried out without much expertise Importance of grading Helps quick sale (Due to proper Price and Quality relation) Facilitates advertising Widens markets ( due to grading ) Helps fixation of prices Assists in raising finance Creates consumers confidence Helps in calculation of loss ( From insurance company) Avoids adulteration ISI (Indian Standard Institution) , AGMARK ISO 9000 ( International Standard Organization ) 6.Branding Giving a particular name , word, Symbol, Design, or a combination of all these to a product/services. For the purpose of to be known, remembered, or identified by consumers. Brand indicates distinct image for a product by assuring a certain quality. Brands are registered under law Name of manufacturer as a brand. Godrej, Tata , Bajaj Special name is chosen to identify the brand Pepsi, Lifebuoy, Lux A trademark , symbol , picture is used as a brand LIC, Nirma Essentials of a Good Brand

Simplicity : Lux, Nirma , Wheel , Kit Kat Brevity : Name should not be too long . Short names. ZEE, NANO Suggestively : Brand name should describe the quality & uses of product Lijjat Papad, Sunlight Soap Capability for registration : Illustrative and attractive : Attractive, pleasant & distinctive picture Murphy radio, MRF Tyres , Parle G Stability : Brand should remain attractive for considerably long time Uniqueness : The brand name should not become a common term for same product manufactured by other manufacturers e.g. DALDA, XEROX Importance of Branding Gives identity Gives protection ( Due to registration, Nobody can use the brand name ) Facilitates packaging Dampens competition Facilitates advertising Creates steady demand Enjoys consumers preference 7. Packaging Designing & producing a container or wrapper for product To protect from dust , leakage, breakage, etc Designing & producing packing material for packing the goods Packing materials used for producing packages Paper, Polythene, Card Board, Thermacol , Aluminum foil , Aluminum etc Attractive & useful to customers Useful for writing ad matter and protection of product Importance of Packaging Protection , Easy Handling, Identity, Wide Markets, Consumer Preference, Space Saving , Useful Information Labeling Small slip place on the product Provides information contents, price , expiry date , batch no. etc

 Helps in identification of product Stresses the features of the product which are advertised Gives proper instructions about use of the product Labelling encourages the manufacture of quality product 8. Warehousing Process of storing & preserving goods from the time of production to the time of ultimate consumption. Provides time and place utility Key marketing function Storing & maintaining quality of goods Creates time utility Needed by producers as well as middlemen Warehouses are available from govt ag.& private firms Warehousing facilities can be owned or rented Generally located at central places In transportation , warehousing plays an imp. role goods in large qty stored in warehouses. & large qty transportation reduces the cost of transportation Importance of Warehousing Seasonal production Seasonal demand Mass production Stability in prices Raising finance Less transportation cost Wide market Prices hikes ( Sometimes producers may retain the goods till he gets desired price hike ) Perishable goods ( Specialized warehouses like cold storage are useful to store milk, fruits, vegetables, etc Types of Warehouses A. Public warehouses Big warehouses

Constructed , owned & managed by Public Enterprises, Cooperative societies, Government owned corporations 1. Bonded Warehouses : Managed by port authorities Imported goods on which custom duty is not paid are shifted to these warehouses Goods to be exported can also be stored in such warehouses 2.Duty Paid Warehouses Situated near but outside the dock area . Goods on which custom duty is paid are stored Goods can be released by giving warehouse rent 3.Cold Storage warehouses Meant for perishable goods Temp. at specific level is maintained to avoid deterioration B. Private Warehouses Owned by traders & manufacturers C. Cooperative Warehouses Owned by cooperative societies Provide storage facilities to the members D. Government Warehouses 1.National Cooperative Development & Warehousing Board Provide funds to warehousing corporations & State Governments which in turn can provide funds to cooperative societies for marketing & storage of agrl. Goods. 2.Central Warehousing Corporation It runs warehouses at various places in India for agrl. Products., fertilizers etc It also has cold storage warehouses 3.State warehousing corporation 9.Financing Finance is the lifeblood of commerce Marketers require Working & Fixed Capital Fixed capital : Finance used for Land , building, machinary etc Working Capital : For expenses of raw materials, transportation , wages , advertising expenses etc To carry on production, selling activities For product modifications To carry stocks

 11. Insurance Process in which one party ( the insurer) agrees for a sum of money ( a premium) which is paid by second party ( the insured) to pay the insured a specified sum if he should suffer a particular loss. To cover risks & uncertainties of business Transfer of risk Protection Assured profits Financial assistance Minimizing risk Industrial developments ( Insurance cos invest their funds in shares & debentures of cos ) 12.Marketing Risk Marketing risks classified as follows A.Economic Risk 1. Time risk (Advance production, Change in demand pattern, Changing fashion ) 2. Place risk ( Transportation of goods from place of production to place of consumption in anticipation of demand but demand may not be as per the expectation at the particular place. 3.Competition risk ( Price wars, Price undercutting between the competitors, Providing very special schemes etc) B. Political Risk Due to intervention by govt., Imposition of taxes, restriction on exports/imports etc leads to the losses to the businessmen. C. Physical Risks Loss in transit , theft, leakage etc of the product D. Natural Risks Risk due to natural calamities E. Human Risks

Risk due to dishonest ,incompetent, careless employees of the organization , Death or sickness of employee. Avoiding risks by taking diff. preventive measures ( Insurance, Fire extinguishers etc) Absorption of risk The losses may be adjusted with windfall profits Shifting of the risk To the insurance companies 13. Advertising Any paid form of non personal presentation and promotion of ideas , goods and services by an identified sponsor. Advertising media The physical means whereby a producer or supplier of goods utilities or services tells the consumer about his products or services. Print media ( News paper Magzene), Broadcasting /Electronic media ( TV , Radio) Outdoor media ( poster advt., Hoardings, Neon sign, POP Media ( Ads at the place of final purchase of product) 14. Market Research The process of collecting information through research for the purpose of taking marketing decisions is known as Marketing Research Techniques of Marketing Research 1. Factual Survey a. House to House Enquiry or Personal Interview b. Investigation through the post or mail survey c. Telephone survey 2. Observation Method 3. Experimentation method 4. The panel research a. House to House Enquiry or Personal Interview Merits Better than telephone & mail method as observations like body language / facial expressions of the respondent can be seen

Supplementary questions can be asked Better control by Interviewer over respondent Demerits Expensive Time consuming Accuracy of information depends on the skills of the interviewer b. Investigation through the post or mail survey Questionnaire is drafted & mailed to respondent Through the post along with covering letter. Mostly closed ended questions Usually gifts & competitions are announced in order to motivate people to send back the questionnaire. Merits Less expensive Large no. of people & larger geographical area can be covered. Demerits No guarantee that respondent will send back the form Sometimes incomplete forms No face to face contact & interaction c. Telephone survey Interviewer contacts the respondent on telephone Merits Economic & speedy method of collecting data Suited for upper classes of society who are difficult to contact personally. Respondent can talk frankly /freely Demerits Only those people can be contacted those having telephone Wrong nos., Dead phones 2. Observation Method Observer silently views the behavior of the respondent e.g. Observing the customer at a sales counter Observations are done by humans as well as machines ( Hidden cameras etc) 3. Experimentation method

To carry out a small scale trial solution to a problem. e.g. A firm may try to determine whether the change in the design of the package of a particular product has an effect on sales. Thus three designs may be made & the diff. packages of the same product may be sold in 3 diff. mkts. To study which design is most acceptable 4. The panel research The same group of respondents are interviewed on more than one occasion to find out whether there has been any change in their demand , tastes, preferences, likes, dislikes etc.

 Business Management (B.COM. S.Y.)

Business includes a wide variety of occupations concerned with the production of goods & services that are needed by the society in which they live. Characteristics of business Exchange of goods and services Continuity Production Distribution of goods & services Profit objective Profit uncertainty Social activity ( Progress of Owner, Labors, Suppliers, Customers , Government) Foundation of economic development ( Employment, Improvement in living conditions , Economic development ) Essentials of Successful Business Organizations Adequate finance Proper location , layout & size Fascillities for research Dynamic Leadership Planning & Organization Well determined objectives Government policy Effective salesmanship Peaceful Industrial relations Use of modern techniques Benefits of business Improvement in standard of living Satisfaction of human requirements Provision of continuous flow of goods & services Opportunities to individuals for development

Employment generation Management Management means to manage for forecast, to plan, to organize, to command, to coordinate, & to control . Management is the art of getting things done through & with people in formally organized group. The manager works with a specific resource : man .He develops people. Whatever a manager does , he does through making decisions Management is an art Art refers to the creative skills & talents which people require to conduct certain activities in order to accomplish certain goals. Art is nothing but the application of scientific principles for the attainment of preplanned targets or goals. Management is an art due to following reasons Management is innovative ( Innovative managers are essential) Individual approach to handle situations ( Good managers requires skills, knowledge, & also individual approach or style to handle situations. Application & dedication of skills Good managers not only require skills & knowledge but also discipline , dedication & commitment. Accomplishment of results Initiative Intelligence (Successful managers should have Mental , Social Inter-Personal, & Emotional intelligence.) Management as a Science Management is a social science as it deals with human beings. Management is a social science due to following reasons a. Systematic collection & processing of information Managers collect information either by observation, experiment, or by practice e.g. Marketing Research Manager collect information either by observation, or experimentation or by way of field research The collected data is processed through computers .

After processing the data is analyzed & then by using his judgement & experience , the manager takes a decision. b. Output may vary the inputs being the same In physical sciences , the output varies if there is a variation in input. However in management , the output may vary , even when the input remains the same . This is because it deals with human beings . Subordinates working under one manager may give different results at different times depending upon the situation. c. Process of management is universally followed Managers in all organization , whether large or small & at all levels , follows the process of management . All managers need to plan , to organize, to direct, & to control their activities. d. Principles of management are universally accepted All successful organizations do follow the well established principles of management such as division of work, unity of command, authority, & responsibility, discipline, etc However the degree of application varies from one manager to another manager & from one situation to another situation.& from one organization to another organization. Management as a Profession Profession is an occupation carried out by professional people like doctors, lawyers, etc It involves the application of expert knowledge to solve specific problems or to handle specific tasks. Management is a high class profession . Modern managers adopt a professional approach to handle tasks & responsibilities. Characteristics of a Profession Expert knowledge Formal education Code of conduct ( The actions of a professional are guided by a code of conduct ) Social Responsibility

 Professionals are required to be socially responsible while handling their tasks & responsibilities Actions should not be guided only by monetary considerations but they also must be socially responsible. Independent Office Normally professionals practice from their own independent office Specialization Professionals may specialize in a particular field. Requirement of license Fees They have a no. of clients. Functions of Management (Henry Foyal) A. Planning It includes a) Forecasting Formation of b) Objectives c) Policies d) Programs e) Schedules f) Procedures & Budgets B) Organising It includes a) Departmentation b) Delegation of authority c) Assigning of responsibility d) Establishment of relationships C) Directing It includes a) Decision making b) Guiding c) Supervising d) Communication D) Coordinating It includes a) Balancing b) Timing c) Integrating E) Motivating It includes a) Selection b) Communication c) Participation d) Appraisal e) Counseling f) Training F) Controlling It includes a) Fixation of standards b) Measurement c) Interpretation d) Correction

Functions of Management ( Luther Gluic ) POSDCORB Planning Organising Staffing Directing Coordinating Reporting Budgeting Managerial Skills Conceptual Skills Abilities to think in creative & abstract terms, to visualise, & understand the future, to organize Conceptual skills are essential to diagnose the problems , to understand the overall organizational interests, & needs to determine organizational goals & strategies & to plan important changes. Analytical skills Decision Making Abilities to work down a complex problem or situation into its components, to clinically examine its dimensions , to proceed in a logical & step by step manner Behavioural or Interpersonal or Human Relations Skills It represents the abilities to understand the behavior of the people , their problems, , needs & feelings, in work situations , to interact & communicate with them ., to motivate people, , to provide leadership, , to build effective teamwork & to resolve conflicts. Administrative Skills Abilities to act in a systematic manner , to get things done by implementing plans, to mobilize & organize resources in optimum way. Technical Skills Job knowledge & expertise Ability to apply methods & techniques of the job To provide technical guidance & instructions to subordinates. Computer skills Communication Skills Skill of telling, listening & Understanding Communicating in an effective way Written as well as verbal