Trademark in India

Intellectual Property Laws in India

WHAT ARE THE TYPES OF TRADEMARKS THAT CAN BE REGISTERED
Under the Indian trademark law the following are the types of trademarks that can be registered:
Product trademarks: are those that are affixed to identify goods.
Service trademarks: are used to identify the services of an entity, such as the trademark for a
broadcasting service, retails outlet, etc. They are used in advertising for services.
Certification trademarks: are those that are capable of distinguishing the goods or services in
connection with which it is used in the course of trade and which are certified by the proprietor
with regard to their origin, material, the method of manufacture, the quality or other specific
features
Collective trademarks: are registered in the name of groups, associations or other organizations
for the use of members of the group in their commercial activities to indicate their membership of
the group.

WHAT ARE LEGAL REQUIREMENTS FOR REGISTRATION OF TRADEMARK IN INDIA
The legal requirements to register a trade mark under the Legislation are:
The selected mark should be capable of being represented graphically (that is in the paper form).
It should be capable of distinguishing the goods or services of one undertaking from those of
others.
It should be used or proposed to be used mark in relation to goods or services for the purpose of
indicating or so as to indicate a connection in the course of trade between the goods or services
and some person have the right to use the mark with or without identity of that person

. Trademark distinctiveness
Trademark distinctiveness is an important concept in the law governing trademarks and service marks.
A trademark may be eligible for registration, or registrable, if it performs the essential trademark function,
and has distinctive character. Registrability can be understood as a continuum, with "inherently
distinctive" marks at one end, "generic" and "descriptive" marks with no distinctive character at the other
end, and "suggestive" and "arbitrary" marks lying between these two points. "Descriptive" marks must
acquire distinctiveness through secondary meaning - consumers have come to recognize the mark as a
source indicator - to be protectable. "Generic" terms are used to refer to the product or service itself and
cannot be used as trademarks.
A service mark or servicemark is a trademark used in the United States and several other countries to
identify a service rather than a product.
[1]
When a service mark is federally registered, the standard
registration symbol or "Reg U.S. Pat & TM Off" may be used (the same symbol is used to mark
registered trademarks). Before it is registered, it is common practice (with some legal standing) to use
the service mark symbol (a superscript SM).
Usage[edit]
A service mark differs from a trademark in that the mark is used on the advertising of the service rather
than on the packaging or delivery of the service, since there is generally no "package" to place the mark
on, which is the practice for trademarks. For example, a private carrier can paint its service mark on its
vehicles, such as on planes or buses. Personal service providers can place their service marks on their
delivery vehicles, such as on the trucks of plumbers or on moving vans. However, if the service deals with
communications, it is possible to use a service mark consisting of a sound (a sound trademark) in the
process of delivering the service. This has been done in the case of AT&T, which uses a tone sound
followed by a woman speaking the company's name to identify its long distance service; MGM, which
uses the sound of a lion's roar; and RKO, which uses a Morse code signal for their motion pictures.
Under United States law, service marks have a different standard of use in order to count as a use in
commerce, which is necessary to complete registration and to stop infringement by competitors. A
trademark normally needs to be used on or directly in association with the sale of goods, such as on a
store display. As services are not defined by a concrete product, use of a service mark on the uniforms or
vehicles of service providers or in advertisements is instead accepted as a use in commerce. However,
like trademarks, service marks must pass a test of distinctiveness for it to be qualified as a service
mark. Thrifty, Inc. attempted to submit a service mark application that described aspects of their business
(uniforms, buildings, certain vehicles) as "being blue." The application was rejected for not being specific
enough, and the rejection was upheld on appeal.
[2]


A certification mark
The existence of a follow-up or product certification agreement between the manufacturer of a
product and an organization with national accreditation for both testing and certification,
Legal evidence
[citation needed]
that the product was successfully tested in accordance with a nationally
accredited standard,
Legal assurance
[citation needed]
the accredited certification organization has ensured that the item that
was successfully tested is identical to that which is being offered for sale,
Legal assurance
[citation needed]
that the successful test has resulted in a certification listing, which is
considered public information, which sets out the tolerances and conditions of use for the certified
product, to enable compliance with the law through listing and approval use and compliance,
Legal assurance
[citation needed]
that the manufacturer is being regularly audited by the certification
organization to ensure the maintenance of the original process standard that was employed in the
manufacture of the test specimen that passed the test. If the manufacturer should fail an audit, all
product that was certified, including labels of stock on hand, on construction sites, with end-user
customers and on distributor store shelves, can be mandated by the certification organization in
charge to be immediately removed, and can insist that all stakeholders be informed that the de-
listed product certification is no longer eligible for use in field installations.
On the part of the certifier, the label itself is a type of trademark whereby the listee, or manufacturer, uses
the mark to indicate eligibility of the products for use in field installations in accordance with the
requirements of the code, and/or the origin, material, mode of manufacture of products, mode of
performance of services, quality, accuracy of other characteristics of products or services
Certification marks distinguished from other marks[edit]
Certification marks differ from collective trade marks. The main difference is that collective trade marks
may be used by particular members of the organization which owns them, while certification marks are
the only evidence of the existence of follow-up agreements between manufacturers and nationally
accredited testing and certification organisations.
[citation needed]
Certification organizations charge for the use
of their labels and are thus always aware of exact production numbers.
[citation needed]
In this way, certification
organisations can be seen to earn a commission from sales of products under their follow-up regimes. In
return, the use of the certification marks enables the product sales in the first place.
Certification is often mistakenly referred to as an "approval", which is often not true. Organizations such
as Underwriters Laboratories, NTA Inc, and CSA International for instance, only "list", they do
not approve anything except the use of the mark to show that a product has been certified. Thus, for
instance a product certification mark for a fire door or for a spray fireproofing product, does not signify its
universal acceptance for use within a building. Approvals are up to the Authority Having
Jurisdiction (AHJ), such as a municipal building inspector or fire prevention officer. Conversely, FM
Global does use the term "Approvals" for its certification listings, which are intended for use of the
products withinbuildings that are insured by FM Global. The German accreditor Deutsches Institut fr
Bautechnik (DIBt) issues "Approvals" for systems. All of these listed products must conform to listing and
approval use and compliance.
For various reasons, usually relating to technical issues, certification marks are difficult to register,
especially in relation to services. One practical workaround for trade mark owners is to register the mark
as an ordinary trade mark in relation to quality control and similar services.
Certification marks can be owned by independent companies absolutely unrelated in ownership to the
companies, offering goods or rendering services under the particular certification mark.
Regulations concerning the use of certification marks[edit]
Trademark laws in countries which provide for the filing of applications to register certificate marks also
usually require the submission of regulations
[citation needed]
which set out a number of matters,
[citation
needed]
including:
the people authorized to use the certification mark
the characteristics to be certified by the certification mark
how the certifying or standards tests these characteristics and supervises the use of the mark
dispute resolution procedures
The main purpose of the regulations is to protect consumers against misleading practices.
[citation needed]

Examples[edit]
The CE mark meaning "European Conformity", formerly EC mark is a mandatory conformity mark
for products placed on the market in the European Economic Area (EEA). With the CE marking on a
product the manufacturer ensures that the product conforms with the essential requirements of the
applicable EC directives.
The NOM logo serves a similar purpose for products on the market in Mexico.
The FCC Declaration of Conformity is a mandatory conformity mark for electronic equipment
manufactured or sold in the United States. This marking certifies that the product meets standards of
the Federal Communications Commission regarding electromagnetic interference.

A collective trademark, collective trade mark, or collective mark is a trademark owned by an
organization (such as an association), used by its members them to identify themselves with a level of
quality or accuracy, geographical origin, or other characteristics set by the organization.
Collective trademarks are exceptions to the underlying principle of trademarks in that most trademarks
serve as "badges of origin"; they indicate the individual source of the goods or services. A collective
trademark, however, can be used by a variety of traders, rather than just one individual concern, provided
that the trader belongs to the association.
Collective trademarks differ from certification marks. The main difference is that collective trademarks
may be used by particular members of the organization which owns them, while certification marks may
be used by anybody who complies with the standards defined by the owner of the particular certification
mark.
Regulations on use[edit]
National trademark laws in some countries (such as Finland, Germany, Hungary and Switzerland) provide
for the filing of the regulations as an additional requirement for registration of the collective trademark.
The regulations shall normally specify:
the name and seat of the organization,
information on the members authorized to use the collective trademark, including their names,
addresses and seats,
the conditions of membership,
the conditions of use of the collective trademark,
the prescriptions relating to the control of the use of the collective trademark,
the order of proceedings against unauthorized use of the collective trademark.
The main purpose of the regulations is to protect consumers against misleading practices.
International treaties[edit]
Many jurisdictions have been required to amend their trademark legislation in order to accommodate the
requirement of protection of collective marks under TRIPs. Art. 7 bis of the Paris Convention also requires
signatories "to accept for filing and to protect collective marks belonging to associations the existence of
which is not contrary to the law of the country of origin, even if such organizations do not possess an
industrial or commercial establishment."
Examples[edit]
Examples of collective trademarks include:
the "CA" device used by the Institute of Chartered Accountants;
the mark "CPA", used to indicate members of the Society of Certified Public Accountants; and,
the marks of various confederated lobby groups.
DIFFERENT STEPS FOR TRADE MARK REGISTRATION
Step 1: A trademark application has to be filed before the Registrar of Trade Marks. It should be filed at
the office of the Trade Marks Registry corresponding to the principal place of business of the applicant.
(In India, the Trademark registries are in Chennai, Delhi, Mumbai, Ahemdabad and Kolkata. So if your
business is in Bengaluru, you have to apply before the Registry in Chennai).
Step 2: An application can be filed by the proprietor of the business for use by the proprietor or his
business. You can file either in the name of the proprietor or in the name of the business.
We often guide applicants to apply in their personal name if they are unsure about the prospects of the
business but have a very catchy name. So for instance, if you have the name Bangalore Bajji Balle Balle
(or any other funny and catchy name) but dont know if your restaurant will succeed because of the
competition, you should choose to apply in your own name. In case things do not work out, you can
always use the name for your next venture. If the trademark is in the name of the Company, it usually
dies with the Company.
Step 3: While applying for the Trade Mark Registration, the proprietor has to define the class under which
he wants his product / service to be classified. The classification has to be done according to Schedule 4
of the Trade Marks Rules, 2002.
Step 4: Finally, once the work is done, you need to pay the fees associated with the Trademark. Today,
as per the Trademark Rules, 2002, the application fees (similar to a tax) are Rs. 3500 per trademark.
Distinctive Features of a Trademark
The trademark to be registered should have distinctive features. Naturally, it cannot be blasphemous or
obscene. It should also not make any reference to a living person without his consent or the consent of
his representative, as the case may be.
Distinctive character
Firstly, a trademark must be distinctive to be valid for registration, as its most important role is to be able
to distinguish a certain trader's goods and services from similar goods and services of other traders.
Distinctiveness is assessed in relation to the goods or services for which the trademark is applied for. A
word mark is not distinctive if it denotes as it stands or with only minor alterations or additions the kind
of the goods or services.
Words that describe a kind (GALOSHES for shoes), quality (EXCELLENT), quantity (TEN), use (RAIN for
rainwear), price (CHEAPEST), place of manufacture (SWEDEN for cars), or time of manufacture (1999)
are not distinctive. Similarly, a combination of several describing words may also totally lack distinctive
character.
There are words such as SALE that cannot be registered, in order to safeguard freedom of advertising.
So no one can be granted an exclusive right to them. The distinctive character is assessed in Finnish,
Swedish, English and in some other common languages. Thus, an English word describing the qualities
of the goods or services may also lack distinctive character.
The requirement for distinctive character also applies to all other types of marks. For instance, a mark
consisting of a simple figure such as a circle would not be able to distinguish a trader's goods or services
from those of others. A combination of word and figure may also lack distinctive character if it only
consists of a simple figure and an expression describing the qualities of the goods or services.
No confusing similarity
Secondly, a trademark must not be liable to be confused with any previous trademark or company name
of other proprietors. Thus, when assessing confusing similarity, a proposed trademark is considered in
relation to pre-existing rights.
Trademarks are regarded as liable to confusion if they are identical or similar and, in addition, relate to
identical or similar goods or services. Accordingly, similar marks that cover different goods do not
normally create a likelihood of confusion.
For instance, it has been possible to register "Eskimo" for ice cream in class 30, although it has previously
been registered for clothing in class 25. In spite of the same trademark, no confusion arises because the
goods are completely different from each other.
Trademarks with a reputation make an exception to this principle, as they can constitute an obstacle to
the registration of non-identical or dissimilar goods or services. With this exception, we aim to protect
such marks against damage to and unfair exploitation of their reputation.
When assessing possible confusing similarity, the following may constitute obstacles to registration:
previous domestic trademarks and applications
European Community trademarks and applications
domestic company names applied for or recorded in the Trade Register
You can easily examine such possible obstacles on various free Internet databases.

Trade mark laws
India's obligations under the TRIPS Agreement for protection of trademarks, inter alia, include protection
to distinguishing marks, recognition of service marks, indefinite periodical renewal of registration, abolition
of compulsory licensing of trademarks, etc.
With the globalization of trade, brand names, trade names, marks, etc. have attained an immense value
that require uniform minimum standards of protection and efficient procedures for enforcement as were
recognised under the TRIPS. In view of the same, extensive review and consequential amendment of the
old Indian Trade and Merchandise Marks Act, 1958 was carried out and the new Trade Marks Act, 1999
was enacted. The said Act of 1999, with subsequent amendments, conforms to the TRIPS and is in
accordance with the international systems and practices.
The Trade Marks Act provides, inter alia, for registration of service marks, filing of multiclass applications,
increasing the term of registration of a trademark to ten years as well as recognition of the concept of
well-known marks, etc. The Indian judiciary has been proactive in the protection of trademarks, and it has
extended the protection under the trademarks law to Domain Names as demonstrated in landmark cases
of Tata Sons Ltd. v. Manu Kosuri & Ors, [90 (2001) DLT 659] and Yahoo Inc. v. Akash Arora [1999 PTC
201].
India, being a common law country, follows not only the codified law, but also common law principles, and
as such provides for infringement as well as passing off actions against violation of trademarks. Section
135 of the Trade Marks Act recognises both infringement as well as passing off actions.



Procedure of Registration of Trademark in India
The procedure for registration of a trademark in India is given below:



Role of Indian trade mark
- As per modern business conditions a TM performs following functions:- -Helps guarantee the quality of
goods bearing the mark. -Creates and maintains a demand for the product -Used as a marketing tool to
build a brand -Can have great $ value to a company. -It identifies the product and origin. -It guarantees its
unchanged quality. -It advertises the product. -It creates an image for the product. 8
- As per modern business conditions a TM performs following functions:- -Helps guarantee the
quality of goods bearing the mark. -Creates and maintains a demand for the product -Used as a
marketing tool to build a brand -Can have great $ value to a company. :
REGISTRATION OF TRADEMARK Requirement of filling trademark application - 1. Name & address of
the applicants, company or person. 2. Trademark logo or symbol (10 copies). 3. Classes. 4. Description of
goods or services. 5. Original priority documents, if priority is claimed. 6. Power of attorney duly notarized.
9 Head Office- Mumbai Term & renewal of TM:- initial registration is for 10 years renewal further after
every 10 year renewal within 6 month from the date of expiry.


Economic polocy
The pharmaceutical industry is important because it is a major source of medical innovation. The U.S.
research-based industry invests about 17 percent of sales in R and D, and R and D drives performance of
individual firms and industry structure. It is also a heavily regulated industry. Drugs are evaluated for
safety, efficacy, and manufacturing quality as a condition of market access, and promotional messages
must adhere to approved product characteristics. Drug prices also are regulated in most countries with
national health insurance systems. My research on the pharmaceutical industry has examined issues
related to R and D performance and industry structure, and the effects of regulation on prices, availability,
and utilization of drugs, and on productivity.
R and D, Firm, and Industry Structure
Regulation of market access and promotion derives from uncertainty about drug safety and efficacy.
These product characteristics can only be determined from accumulated experience over large numbers
of patients in carefully designed trials or observational studies. The design, monitoring, and evaluation of
these studies are public goods that in theory can be efficiently produced by an expert regulatory
agency.
(1)
The 1962 Amendments to the FDA Act extended the powers of the FDA to review safety,
efficacy, manufacturing quality, and promotion. Subsequent studies concluded that the safety and efficacy
requirements added to the intrinsically high cost of R and D, led to launch delay of new drugs and favored
large over small firms.
However, more recently the biotechnology revolution has transformed the nature of drug discovery and
the structure of the industry. Increasingly, new drugs originate in small firms, which often out-license their
products to more experienced firms for later-stage drug development, regulatory review, and
commercialization. In any year the biotechnology industry may comprise a couple of thousand firms, but
the identity of these firms changes, as new start- ups are formed and established firms grow, merge, or
are acquired by other established companies. Although larger firms have grown in market share, because
of mergers, their performance has lagged that of smaller firms, on whom the large firms increasingly rely
for new products.
In a series of papers, I and my co-authors have examined the effects on R and D productivity of firm
experience and alliance relationships; the nature of the market for alliances between small and large
firms; and the effects of mergers and acquisitions. In a study of the determinants of drug success in
clinical trials,
(2)
we find that returns to a firm's overall experience (number of drugs developed across all
therapeutic categories) are small for the relatively simply phase 1 trials, but significantly positive (with
diminishing returns) for the larger and more complex phase 2 and phase 3 trials that focus on efficacy
and remote risks. We find some evidence that focused experience is more valuable than broad
experience ("diseconomies of scope across therapeutic classes"). Products developed in an alliance have
a higher probability of success in the more complex late stage trials, particularly if the licensee is a large
firm. Thus although larger firms enjoy economies of scale in experience for the complex trials, smaller
firms can tap into this expertise through licensing agreements.
Product development deals thus define the sharing of responsibilities and rewards between large and
small firms. The small firm typically gets cash and/or equity upfront, plus contingent milestone and
royalties payments, and may choose to participate in late-stage development and co-marketing, in order
to gain experience. In return, the large firm obtains rights to develop and market the new product,
retaining the majority of product revenues, with specifics depending on the stage of the deal. The
efficiency of the market for deals is important because it allocates rents between the smaller and
originator firm, as opposed to the larger developer/marketer, and hence influences incentives. It also
provides interesting evidence on how participants use contractual structure to control possible distortions
attributable to symmetric information and agency.
Our analysis examines the determinants of deal prices, with the caveat that the reported financial values
are the simple sum of upfront cash, equity, and contingent milestone payments, ignoring the latter's
uncertainty and lags; other contractual terms are not reported.
(3)
We find that inexperienced firms
received substantially discounted payments on their first deal, although this discount was not consistent
with the post-deal performance of these drugs. However, we find that these first deals are associated with
substantially higher valuations from venture capital and public equity markets. This evidence suggests
that a deal with an experienced pharmaceutical company validates a start-up company's products,
sending a positive signal to prospective investors, and making the deal discount a worthwhile investment
for the small firms.
In addition to product licensing, mergers and acquisitions (M&A) are common in the pharma-biotech
industry. Large horizontal mergers were particularly frequent in the late 1980s and 1990s, while
pharmaceutical acquisitions of biotech companies have become more common recently. Several of the
largest firms are the result of successive large horizontal mergers, and this has contributed significantly to
industry concentration. Such mergers are often rationalized on grounds of economies of scale and scope
in R and D, marketing, and administration. In our analysis of M&A in the pharma-biotech industry, we
tested various alternative hypotheses to explain both large and smaller mergers, and then examined the
effects of mergers using propensity scores to control for merger endogeneity.
(4)
For larger firms, we find
that mergers are a response to patent expirations and gaps in a company's product pipeline, which lead
to excess capacity of the fixed marketing resources. For smal ler firms, mergers are primarily an exit
strategy in response to financial trouble, as indicated by a low Tobin's q, few marketed products, and low
cash-sales ratios. Controlling for a firm's ex ante propensity to merge significantly affects the estimates of
merger effects. Firms with relatively high propensity scores experienced slower growth in sales,
employees, and R and D, regardless of whether they actually merged; this is consistent with mergers
being a response to distress. For large firms, a merger did not significantly affect subsequent
performance on average, whereas small firms that merged had slower R and D growth than similar firms
that did not merge; this suggests that post-merger integration may divert cash from R and D. This
conclusion, that merger is often a response to distress but is usually not an effective solution, is
consistent with the subsequent slow-down in M&A in this industry, with the exception of selective,
strategic acquisitions, as large firms acquire smaller firms with spe cifically well-matched capabilities or
products. Thus, although the "survivor" evidence -- with increased market share of the top ten firms over
time -- might suggest that large firms have advantages, recent stock market performance tells a very
different story.
Price Regulation -- Rationale and Effects
The high rate of entry to the pharmaceutical-biotechnology industry indicates that it is structurally
competitive. To the extent that market power exists, it derives from patents that are legal grants of
monopoly power to enable originator firms to recoup their R and D costs. Although patents bar generically
equivalent products for the life of the patent, they do not prevent entry of similar products that may be
therapeutic competitors. Thus, neither natural monopoly nor patents provide a rationale for regulating
pharmaceutical prices.
Economics of manufacturing[edit]
According to some economists, manufacturing is a wealth-producing sector of an economy, whereas
a service sector tends to be wealth-consuming.
[2][3]
Emerging technologieshave provided some new
growth in advanced manufacturing employment opportunities in the Manufacturing Belt in the United
States. Manufacturing provides important material support for national infrastructure and for national
defense.
On the other hand, most manufacturing may involve significant social and environmental costs. The
clean-up costs of hazardous waste, for example, may outweigh the benefits of a product that creates it.
Hazardous materials may expose workers to health risks. These costs are now well known and there is
effort to address them by improving efficiency, reducing waste, using industrial symbiosis, and eliminating
harmful chemicals.
[4]
The increased use of technologies such as 3D printing also offer the potential to
reduce the environmental impact of producing finished goods through distributed manufacturing.
[5]

The negative costs of manufacturing can also be addressed legally. Developed countries regulate
manufacturing activity with labor laws and environmental laws. Across the globe, manufacturers can be
subject to regulations and pollution taxes to offset the environmental costs of manufacturing
activities. Labor unions and craft guilds have played a historic role in the negotiation of worker rights and
wages. Environment laws and labor protections that are available in developed nations may not be
available in the third world. Tort lawand product liability impose additional costs on
Production Capacity
(of a branch of industry or of an enterprise or its subdivision), the maximum possible output of a high-
quality product, or the volume of rawmaterials processed in a unit of time (usually a year).
In socialist countries the production capacity is determined by a plan, in terms of the production list and a
ssortment, as well as quantitativerelationships. The plan is based on the fullest utilization of production eq
uipment, floor space, advanced technology, and organization of labor.The estimate of an enterprises pro
duction capacity uses the same production-
measuring units as the plan. Natural units (goods, parts, pieces,or tons) are the simplest and most accura
te measures. The production capacity of a key group of equipment determines the capacity of aproductio
n unit, and the capacity of the latter determines that of the workshop, which determines the production ca
pacity of the enterprise.Measures designed to eliminate bottlenecks are taken into account in calculating
the production capacity. A significant portion of the fixedproductive assets is concentrated in the key sub
division, which carries out the principal technological operations in manufacturing the product.The sum of
the production capacities of individual plants manufacturing the same type of output constitutes the total p
roduction capacity of thebranch for the particular type of output.
The primary data used in calculating the production capacity include fixed productive assets operating sc
hedules for equipment and utilizationof floor space, progressive standards for the productivity of equipme
nt and for the labor intensiveness of a set or batch of goods (parts), and theskill of the workers. If the prod
uctivity of the equipment is known, the production capacity is defined as the product of the rated output of
theequipment (per unit time) and the time allotted in the plan for the operation of the equipment. If the out
put is highly diversified, the productioncapacity is defined as the quotient of the time allotted in the plan an
d the labor intensiveness of a set of goods (or parts) produced by thespecified equipment.
Production capacity is a dynamic value that changes with improvements in technology, labor efficiency, th
e organization of production andlabor, and the workers level of culture and skills. According to methods u
sed in industry in the USSR, production capacity is estimated forJanuary 1 of the year of the estimate and
for the following January 1 (capacities at the beginning and end of the year). The average annualproducti
on capacity is also estimated. If the production capacity increases at a uniform rate during the year, the a
verage annual capacityrepresents the average of the capacities for the beginning and end of the year. In
all other cases, the average annual production capacity isdefined as the sum of the production capacity at
the beginning of the year and the average annual capacity of the equipment introduced duringthe year, m
inus the average annual capacity of the equipment removed during the year.
The degree to which the production capacity is utilized is expressed by the coefficient of the utilization of
capacity, which is the ratio betweenthe annual output and the average annual production capacity of a pa
rticular year. A balance of production capacities is compiled to ensure theproduction of the planned volum
e of goods and to determine needs for increased production capacity.


Marketing and its Evolution:
The question what is marketing could be answered as, it is a process by which one identifies the
needs and wants of the people, creates a product/service to meet the needs and wants, develops a
way of taking the product/service to the market place, determines the way of communicating the
product to the market place, determines the value for the product, targets the people (segmentation),
who have needs/ wants and then creating a transaction for exchanging the product for a value and thus
creating a satisfaction to the buyer's needs/wants (1).
Evolution of marketing didnt took place overnight, international situations and scenarios made the
business people to develop this way of retaining and increasing their business (2).
The evolution process can be in three eras; production, sales and marketing. The production concept
prevailed from the time of the industrial revolution until the early 1920's. It was early industrialization when
output was limited, no competition and high demand. Companies had no interest in consumer
preferences or demands (2). They were only focused on 2 questions, can we produce the product? And
can we produce it in enough quantity? Production concept worked fairly well because the goods that were
produced were largely those of basic necessity and there was a relatively high level of unfulfilled demand.
Virtually everything that could be produced was sold easily at the price determined by the producer.
Production concept prevailed into the late 1920's (3).By the early 1930's however, mass production had
become commonplace, competition had increased, and their demand was decreasing. Now the firms
began to practice the sales concept (or selling concept), which was focused to convince customers to buy
their products through advertising and personal selling. Now the key questions were can we sell the
product? And can we charge enough for it? The sales concept paid little attention to whether the product
actually was needed; the goal simply was to beat the competition to the sale with little regard to customer
satisfaction. Marketing was a function that was performed after the product was developed and produced,
and many people came to associate marketing with hard selling. Even today, many people use the word
"marketing" when they really mean sales (2, 3). After II World War, the variety of products increased and
hard selling no longer could be relied upon to generate sales. With increased discretionary income,
customers could afford to be selective and buy only those products that precisely met their changing
needs, and these needs were not immediately obvious.



Product Orientation
KEY POINTS
A firm employing a product orientation would assume that as long as its product was of a high
standard, people would buy and consume the product.
Under the product orientation, management focuses on developing high quality products which can be
sold at the right price, but with insufficient attention to what it is that customers really need and want.
Product orientation assumes a developing or closed economy where few, if any, choices are available.
Similar to production orientation, the product orientation of marketing focuses solely on the product a
company intends to sell. This orientation was popular during the 1950s and into the 1960s. A firm
employing a product orientation is chiefly concerned with the quality of its product. A firm such as this
would assume that as long as its product was of a high standard, people would buy and consume the
product. This approach stresses the research and development of products and the continuous evolution
during their life cycles , in order to maintain the attention of potential customers. Under the product
orientation, management focuses on developing high quality products which can be sold at the right price,
but with insufficient attention to what it is that customers really need and want. The premises implicit in
this orientation include:

Sales Orientation is a business approach of making profits by focusing on persuasion of people to buy
the products instead of understanding the customer needs. Emphasis is put on advertising and improving
the abilities of the sales force. The product and the production capacity precede the customer. In order to
reach out to many buyers, overcoming competition, advertising campaigns are used which suggests the
Sales Orientation. This orientation does not pay too much attention to the needs of the customer. It simply
tries to push the product already produced via advertising or sales force.
The characteristics of a sales-oriented business are:
More reliance on promotional activity to sell the products/services the company has already
produced.
Aggressive selling tactics
More share of the original budget is given to the Promotion of the products/services
It focusses mostly on short term planning.
Example of a sales-oriented approach can be of one plus one free offers given to the customers. This
approach doesnt try to understand the needs of the customer like increase in the quality of the product,
better design, low price, etc., instead tries to push the sales of the product by providing exciting offers to
the customers.
Though sales orientation help in the short run, they fail to sustain in the long run as the customers
become more and more knowledgeable and demand more variety and better quality. In highly competitive
environments, sales-oriented businesses usually fail and market orientation succeeds.

Customer orientation[edit
A firm in the market economy survives by producing goods that persons are willing and able to buy.
Consequently, ascertaining consumer demand is vital for a firm's future viability and even existence as
a going concern. Many companies today have a customer focus (or market orientation). This implies that
the company focuses its activities and products on consumer demands. Generally, there are three ways
of doing this: the customer-driven approach, the market change identification approach and the product
innovation approach.
[6]

In the consumer-driven approach, consumer wants are the drivers of all strategic marketing decisions. No
strategy is pursued until it passes the test of consumer research. Every aspect of a market offering,
including the nature of the product itself, is driven by the needs of potential consumers. The starting point
is always the consumer. The rationale for this approach is that there is no reason to spend R&D (research
and development) funds developing products that people will not buy. History attests to many products
that were commercial failures in spite of being technological breakthroughs.
[7]

A formal approach to this customer-focused marketing is known as SIVA
[8]
(Solution, Information, Value,
Access). This system is basically the four Ps renamed and reworded to provide a customer focus. The
SIVA Model provides a demand/customer-centric alternative to the well-known 4Ps supply side model
(product, price, placement, promotion) of marketing management.
Product Solution
Promotion Information
Price Value
Place (Distribution) Access
If any of the 4Ps were problematic or were not in the marketing factor of the business, the business could
be in trouble and so other companies may appear in the surroundings of the company, so the consumer
demand on its products will decrease. However, in recent years service marketing has widened the
domains to be considered, contributing to the7P's of marketing in total. The other 3P's of service
marketing are: process, physical environment and people.
Some consider there to be a fifth "P": positioning. See Positioning (marketing).
Some qualifications or caveats for customer focus exist. They do not invalidate or contradict the principle
of customer focus; rather, they simply add extra dimensions of awareness and caution to it.
The work of Christensen and colleagues
[9]
on disruptive technology has produced a theoretical framework
that explains the failure of firms not because they were technologically inept (often quite the opposite), but
because the value networks in which they profitably operated included customers who could not value
a disruptive innovation at the time and capability state of its emergence and thus actively dissuaded the
firms from developing it. The lessons drawn from this work include:
Taking customer focus with a grain of salt, treating it as only a subset of one's corporate strategy
rather than the sole driving factor. This means looking beyond current-state customer focus to predict
what customers will be demanding some years in the future, even if they themselves discount the
prediction.
Pursuing new markets (thus new value networks) when they are still in a commercially inferior or
unattractive state, simply because their potential to grow and intersect with established markets and
value networks looks like a likely bet. This may involve buying stakes in the stock of smaller firms,
acquiring them outright, or incubating small, financially distinct units within one's organization to
compete against them.
Other caveats of customer focus are:
The extent to which what customers say they want does not match their purchasing decisions. Thus
surveys of customers might claim that 70% of a restaurant's customers want healthier choices on the
menu, but only 10% of them actually buy the new items once they are offered. This might be
acceptable except for the extent to which those items are money-losing propositions for the business,
bleeding red ink. A lesson from this type of situation is to be smarter about the true test validity of
instruments like surveys. A corollary argument is that "truly understanding customers sometimes
means understanding them better than they understand themselves." Thus one could argue that the
principle of customer focus, or being close to the customers, is not violated herejust expanded
upon.
The extent to which customers are currently ignorant of what one might argue they should want
which is dicey because whether it can be acted upon affordably depends on whether or how soon the
customers will learn, or be convinced, otherwise. IT hardware and software capabilities and
automobile features are examples. Customers who in 1997 said that they would not place any value
on internet browsing capability on a mobile phone, or 6% better fuel efficiency in their vehicle, might
say something different today, because the value proposition of those opportunities has changed.

market segmentation[edit]
Main article: Market segmentation
Market segmentation pertains to the division of a market of consumers into persons with similar needs
and wants. For instance, Kellogg's cereals, Frosties are marketed to children. Crunchy Nut Cornflakes are
marketed to adults. Both goods denote two products which are marketed to two distinct groups of
persons, both with similar needs, traits, and wants. In another example, Sun Microsystems can use
market segmentation to classify its clients according to their promptness to adopt new products.
[13]

Market segmentation allows for a better allocation of a firm's finite resources. A firm only possesses a
certain amount of resources. Accordingly, it must make choices (and incur the related costs) in servicing
specific groups of consumers. In this way, the diversified tastes of contemporary Western consumers can
be served better. With growing diversity in the tastes of modern consumers, firms are taking note of the
benefit of servicing a multiplicity of new markets.
Market segmentation can be viewed as a key dynamic in interpreting and executing a logical perspective
of Strategic Marketing Planning. The manifestation of this process is considered by many traditional
thinkers to include the following;Segmenting, Targeting and Positioning


CONCEPT OF MARKETING
Five orientations (philosophical concepts to the marketplace have guided and continue to guide
organizational activities:

1. The Production Concept
2. The Product Concept
3. The Selling Concept
4. The Marketing Concept
5. The Societal Marketing Concept


The Five Concepts Described

The Production Concept. This concept is the oldest of the concepts in business. It holds that
consumers will prefer products that are widely available and inexpensive. Managers focusing on this
concept concentrate on achieving high production efficiency, low costs, and mass distribution. They
assume that consumers are primarily interested in product availability and low prices. This orientation
makes sense in developing countries, where consumers are more interested in obtaining the product than
in its features.

The Product Concept. This orientation holds that consumers will favor those products that offer
the most quality, performance, or innovative features. Managers focusing on this concept concentrate on
making superior products and improving them over time. They assume that buyers admire well-made
products and can appraise quality and performance. However, these managers are sometimes caught
up in a love affair with their product and do not realize what the market needs. Management might
commit the better-mousetrap fallacy, believing that a better mousetrap will lead people to beat a path to
its door.

The Selling Concept. This is another common business orientation. It holds that consumers and
businesses, if left alone, will ordinarily not buy enough of the selling companys products. The
organization must, therefore, undertake an aggressive selling and promotion effort. This concept
assumes that consumers typically sho9w buyi8ng inertia or resistance and must be coaxed into buying. It
also assumes that the company has a whole battery of effective selling and promotional tools to stimulate
more buying. 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.

The Marketing Concept. This is a business philosophy that challenges the above three business
orientations. Its central tenets crystallized in the 1950s. It holds that the key to achieving its
organizational goals (goals of the selling company) consists of the company being more effective than
competitors in creating, delivering, and communicating customer value to its selected target customers.
The marketing concept rests on four pillars: target market, customer needs, integrated marketing and
profitability.

Distinctions between the Sales Concept and the Marketing Concept:

1. The Sales Concept focuses on the needs of the seller. The Marketing Concept focuses on the
needs of the buyer.

2. The Sales Concept is preoccupied with the sellers need to convert his/her product into cash. The
Marketing Concept is preoccupied with the idea of satisfying the needs of the customer by means of the
product as a solution to the customers problem (needs).

The Marketing Concept represents the major change in todays company orientation that provides
the foundation to achieve competitive advantage. This philosophy is the foundation of consultative
selling.

The Marketing Concept has evolved into a fifth and more refined company orientation: The
Societal Marketing Concept. This concept is more theoretical and will undoubtedly influence future forms
of marketing and selling approaches.

The Societal Marketing Concept. This concept holds that the organizations task is to determine
the needs, wants, and interests of target markets and to deliver the desired satisfactions more effectively
and efficiently than competitors (this is the original Marketing Concept). Additionally, it holds that this all
must be done in a way that preserves or enhances the consumers and the societys well-being.

This orientation arose as some 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 do an excellent job of satisfying consumer wants necessarily acting in the best long-
run interests of consumers and society?

The marketing concept possibily sidesteps the potential conflicts among consumer wants,
consumer interests, and long-run societal welfare. Just consider:
The fast-food hamburger industry offers tasty buty unhealthy food. The hamburgers have a high fat
content, and the restaurants promote fries and pies, two products high in starch and fat. The products
are wrapped in convenient packaging, which leads to much waste. In satisfying consumer wants, these
restaurants may be hurting consumer health and causing environmental problems.


The 7 Ps of Marketing - taking the wider view
Product
As the product is the item being sold to the customer, the thing that will bring
in money, its features and design need careful consideration. Whether the firm
is manufacturing the product or purchasing the product for resale, they need
to determine what product features will appeal to their target market. When
an organisation is considering introducing a product into a market, they should
ask themselves the following questions:
1. Who is the product aimed at
2. What benefit will customers expect from it
3. What will be its advantage over competitor products? Or its unique
selling point?
4. How does the firm plan to Position the product within the market?
The answers to these questions will help a firm design, package and add value
to its products. To learn more about product strategies within the marketing
mix click on the following link: Marketing Mix and Product strategies

PRICE
There are lots of different pricing strategies but all most at least cover your
costs unless the price is being used to attract customers to the business (loss
leader). A product is worth as much as people are prepared to pay for it. The
amount your target market are prepared to pay for your product depends on
its features and the target market's budget. You will also need to
consider Competitor Pricing and factors within your Marketing Environment.
Effective pricing involves balancing a range of factors, to find out more,
including example of pricing strategies click on the following link: Marketing
Mix and Price Strategies
Promotion
A successful product or service means nothing unless the benefit of such a
service can be communicated clearly to the target market. Promotion is any
activity to raise awareness of a product or to encourage customers to purchase
a product. Advertising is a form of promotion but not all promotions are
advertisements.Promotional activities for consumer sales will be different to promotional
activities for business to business sales. The following things will influence how
a firm chooses to promote its product:
Promotional campaign purpose
The budget for the promotional campaign
Legal rules about what you can promote and how
The target market for the product
The marketing environment in which the firm operates
The following link provides further information on place: Marketing Mix and
Promotion Strategies
Place
The Place element of the marketing place is about where the product is made,
where is it stored and how is it transported to the customer. The place for each
of these things should ensure that the product gets to the right place at the
right time without damage or loss. The ideal place will be
Convenient for the customer and the business
Accessible for the customer if it is the place where the product is sold
Low cost or free for the customer if it is the place where the product is sold
Reasonable cost to the business
The following link provides further information on place: Marketing Mix and
Place Strategies
People
People are an essential ingredient in service provision; recruiting and training
the right staff is required to create a competitive advantage. Customers make
judgments about service provision and delivery based on the people
representing your organisation. This is because people are one of the few
elements of the service that customers can see and interact with. The praise
received by the volunteers (games makers) for the London 2012 Olympics and
Paralympics demonstrates the powerful effect people can create during service
delivery.
Staff require appropriate interpersonal skills, aptitude, and service knowledge
in order to deliver a quality service. In the UK many organisations apply for the "Investors in People" Accreditation to demonstrate
that they train their staff to
prescribed standards and best practices.
Processes
This element of the marketing mix looks at the systems used to deliver the
service. Imagine you walk into Burger King and order a Whopper Meal and you
get it delivered within 2 minutes. What was the process that allowed you to
obtain an efficient service delivery? Banks that send out Credit Cards
automatically when their customers old one has expired again require an
efficient process to identify expiry dates and renewal. An efficient service that
replaces old credit cards will foster consumer loyalty and confidence in the
company. All services need to be underpinned by clearly defined and efficient
processes. This will avoid confusion and promote a consistent service. In other
words processes mean that everybody knows what to do and how to do it.
Physical evidence
Physical evidence is about where the service is being delivered from. It is
particularly relevant to retailers operating out of shops. This element of the
marketing mix will distinguish a company from its competitors. Physical
evidence can be used to charge a premium price for a service and establish a
positive experience. For example all hotels provide a bed to sleep on but one
of the things affecting the price charged, is the condition of the room (physical
evidence) holding the bed. Customers will make judgments about the
organisation based on the physical evidence. For example if you walk into a
restaurant you expect a clean and friendly environment, if the restaurant is
smelly or dirty, customers are likely to walk out. This is before they have even
received the service.
CORPORATE PLANNING AND STRATEGY

A quick look through the management literature provides a description of strategic planning
as an effective way of improving corporate performance. Strategic planning is said to result in
a better match between external environment variables and the changing internal
organizational conditions of the firm. The purpose of this match is to ensure that the plans
continuously realign the firms objectives and strategies with changing conditions to improve
the long-run performance of the company. This interpretation of strategic plannings
fundamental objective can be found in, for example, Ansoff (1979), Andrews (1971),
McNichols (1977), Hofer & Schendel (1978), Camillus (1984), and Prescott (1984).
In addition to the general advantages of strategic plans, several specific advantages are
presented in the literature. These can be classified into those being concerned with the
planning process and those being concerned with the personnel involved in the planning.
Writers such as Stern (1966), Loasby (1967), Hausler (1968), Walker (1976) and Wilson
(1979) have suggested the following advantages for each of the two types:
Process advantages:



f effects from adverse conditions and changes


-ordination of the execution of the tactics of the plan



on of priorities within the timing of the plan

Personal advantages:

ification of individual responsibilities, contributing to
motivation


opportunities
1 Terpstra is a methodology for evaluating the methodological rigor of studies. For original, see Terpstra
(1981);
for adaption to strategic planning research see Armstrong (1982) and Greenley (1986).
4

rmality to the management of a business function that
would not exist without planning
Further, Armstrong (1982) argued that an explicit planning process, rather than haphazard
guesswork, results in the collection and interpretation of data critical to creating and
maintaining organization-environment alignment. Similarly, Ansoff (1991) argued that
planning generally produces better alignment and financial results than a process of trial-anderror
learning.
The benefits of strategic planning were also investigated in two separate surveys by Al-
Bazzaz & Grinyer (1980) and Ang & Chua (1979). Although these empirical studies had a
different emphasis, they were more concerned with what the respondents perceived the
advantages of strategic planning to be.