Business Environment

End Sem Exam

BBA LLB

Section- A
Question 1
What do you understand by market segmentation? Why do marketers
segment consumer markets? Discuss all the types of segmentation and
give suitable examples for them.
“Market Segmentation is the process of dividing a market into distinct subgroups of
consumers with distinct needs, characteristics, or behavior.”(Bedekar)

Market segmentation is an increasingly important part of a strong marketing strategy and can
make all the difference for companies in competitive market landscapes, such as e-commerce.
“The purpose of market segmentation is to identify different groups within your target
audience so that you can deliver more targeted and valuable messaging for them.” (Thomas)

Essentials of Market Segmentation 

Consumers are:

Too numerous.
Too widely scattered.
Too varied in their needs.
Changing Technology.
Taste.
Fashions.
Different behavioral buying patterns.

STP
 S-Segmentation is just the first step towards marketing strategy, which includes
division of market.

 T- Targeting is the step which comes after segmentation where the marketer

must select one or more group of people to target thru a specific marketing mix.
  P- Positioning is the process, which involves arranging a product to occupy a
clear, distinctive, and desirable place relative to competitive products.

Basis of Segmentation

Physiographic Segmentation

Psychographic segmentation is focused on your customers’ personalities and interests. Here

we might look at customers and define them by their:

 Personality traits
 Hobbies
 Life goals
 Values
 Beliefs
 Lifestyles

“Compared to demographic segmentation, this can be a harder set to identify. Good research
is vital and, when done well, psychographic segmentation can allow for incredibly effective
marketing that consumers will feel speaks to them on a much more personal level”. (Thomas)

Geographic Segmentation

“By comparison, geographic segmentation is often one of the easiest to identify, grouping

customers with regards to their physical location.” (Thomas) This can be defined in any
number of ways:

 Country
 Region
 City
 Postal code

For example, it’s attainable to group services inside a set range of the place of residence or
activity – and superior alternative for marketers of live occurrence revere reach local hearing.
Being aware of your services’ place of residence or activity admit for miscellaneous
collection of concern when notices to increase consumer desire to person who buys
merchandise.
 Demographic Segmentation

Demographic segmentation might be the first thing people think of when they hear ‘market
segmentation’. “This is perhaps the most straightforward way of defining customer groups,
but it remains powerful”. (Thomas) Demographic segmentation looks at identifiable non-
character traits such as:

 Age
 Gender
 Ethnicity
 Income
 Level of education
 Religion
 Profession/role in a company

For example, mathematical separation ability person as object of ridicule potential services
establish their money earned by work or investments, so your shopping budget isn’t
emaciated address your to foreshadow at human beings the one likely can’t able to have or do
your result or goods created.

Behavioral Segmentation

Behavioural segmentation is possibly the most useful of all for e-commerce businesses. “As
with psychographic segmentation, it requires a little data to be truly effective” (Thomas) –
but much of this can be gathered via your website itself. Here we group customers with
regards to their:

 Spending habits
 Purchasing habits
 Browsing habits
 Interactions with the brand
 Loyalty to brand
 Previous product ratings

Other types of marketing segmentations with examples are:

Though ultimate held in common types of package and sell goods separation happen
mathematical, psychographic, terrestrial, and behavioural, skilled exist added types that
happen in addition to estimation associated with something taking everything in mind and
can offer wonderful favourable circumstances fashionable the right circumstances.
 Techno graphic segmentation
Techno graphic segmentation identifies and groups customers with regards to the role
technology plays in their lives. “This might mean recognizing groups of early adopters when
marketing new technologies. It might also be as simple as recognizing the device users access
the site from and presenting deals differently”. (Thomas) With embodiment, it’s smooth to
goal adverts at distinguishing groups in this manner. Consumers achieve a connected to the
internet telephone store by way of the Safari computer network internet /web viewing
software maybe concerned fashionable Apple result or goods created – and maybe put on
display these suitable way.

Generational and life stage segmentation

“Generational and life stage segmentation both expand on aspects of the demographic
approach.” (Thomas) Distinguishing clients by generation permits for wide but unmistakable
approaches depending on age. “Life stage segmentation, however, works similarly whilst
divorcing life experience from age itself.” (Thomas) Instead, it groups customers by factors
including marital status, home-ownership, and whether or not they have children (and more
specific still by considering the ages of their children).

Transactional segmentation

“Transactional segmentation is based on previous interactions your customer has had with
your brand. Whilst it can draw on behavioural elements, it also has a much wider scope –
considering the initial source of their registration with your business, how long it has been
since their last order, and how many orders they’ve made overall.” (Thomas)

Firmographic Segmentation

While the over promoting division procedures primarily center on B2C organizations,
firmographic division can be amazingly valuable to those within the B2B world.
“Firmographic segmentation is the process of analyzing and classifying B2B customers based
on shared company or organization attributes & characteristics.” (Thomas)
This division procedure permits B2B companies to superior get it and targets their group of
onlookers and showcasing campaigns. This handle is exceptionally comparable to the way
B2C marketers would utilize statistic division. This type of market segmentation
predominantly uses 7 factors to identify customer segments.

 Industry
 Location
 Company Size
 Status
 Number of employees
 Performance
 Executive Title
 Sales Cycles Stage

This market segmentation process can help form an effective B2B marketing strategy by
identifying target customers and tailoring marketing efforts to these specific customer
segments.
Question 2)
What are the Ecological issues relevant to the business
environment in India? Discuss.
Ecological/environmental issues have a large impact on businesses for a number of
reasons. Costs and public relations are affected areas of note.

“Ecological factors influencing business are also connected to the actions and processes
necessary to protect natural environment and in the same time maintain or
increase efficiency of the corporation” (Wozniak). Ecology often takes the form of so-called
corporate environmentalism. That is, any action that promotes sustainability, earns consumer
appreciation for environmentally friendly products and services, and creates the image of a
responsible company. 

There are several ecological factors influencing management decision, business and

environment goals. “Proper identification of natural environment and its influences
during strategic analysis (STEEP analysis, SWOT analysis, TOWS analysis) could lead to
better strategic alignment of company to ecosystem and state regulations”. (Wozniak)

Environmental factors that affect business and continue to affect production and the
economy. Problems such as major storms, resource losses, inflation and food and water
shortages are causing serious damage. However, solving these complex problems requires the
cooperation of individual departments.

The situation is tough, but environmental issues also provide opportunities for
businesses to come up and show their employees and the market where they stand and what
they want to reduce risk. For example, employees perform better when they are healthy.
However, businesses must always be aware of current events and how they affect their
employees.

Environmental issues are increasingly pervasive worldwide, with their impact on business
and the world, and the risk to the future of all lives. The impact can be seen and immediate
action is required. It is the business owner's responsibility to make a complete list, but find
out how the choices affect the environment. The time has come to make changes to your
needs. Some effects are more subtle than others, but every change contributes to the greater
good of our planet.

Ecological laws and regulations

 Government guidelines and policy participation in environmental protection.

 Fees and fines to use the natural environment.
 Rules for waste treatment, recycling and storage.
 Regulations on CO2 emissions and toxic emissions.
 Value "nature" relative to political campaigns.
  “Increasingly stringent environmental regulations on regional, state and international
levels.” (Wozniak)
 “Cost of non-compliance with ecological regulations” (Wozniak)
 Incentives for businesses or customers to use clean products or services.
 Authorizes government agencies to track business activities and establish minimum
standards for air emissions, including procedures for handling waste and hazardous
materials.
 Requirements for implementing environmental standards.

Social pressure towards clean business

 Environmental groups and activities.
 Attitudes towards environmentally friendly products and services (consumer
preferences and demands for these products),
 Attitudes of tourism from undamaged wetlands, forests, lakes and seas.
 Increased surveys on the ecological impact of stakeholders and customers.
 Ecosystem-related human welfare
 Values and morals are influenced by the religious beliefs of managers and consumers
 The cost of protective and proactive environmental measures.
 “Transparency of corporate activity due to global IT network.” (Wozniak)
 Impact of non-governmental organizations (mobilization of people through social
networks).
 Great attention and increased risk of terrorist attacks using environmental factors
(pollution, nuclear waste, etc.).
 “Role of biases, passion and emotions in environmental decision-making.” (Wozniak)

Technological Advancements

 “Carbon footprint of used technology”. (Wozniak)

• Energy requirements for technical processes.

• Availability of emission reduction technologies (smoke, ash, and particles filled with
chemicals)

• Possibility of recycling waste and parts.

• Technology used to mine and acquire other natural resources.

 • Competitive advantage of new clean technology (opportunities are differentiated from
competitors).

• Capital requirements for green technologies.

• Scientific research in the field of ecosystems and clean technologies.

• Waste and Dangerous Goods Handling and Moving Equipment.

• Assessment and prevention of environmental risks in production.

Natural environment influences

 Water and air pollution (affecting the production processes and food production of
high-tech enterprises).
 Water quality used for consumption or production.
 Health problems in contaminated places (employee turnover) A healthy environment
improves mental and physical health and reduces absenteeism.
 Amount of renewable and non-renewable resources available.
 Biodiversity and protection of ecosystems.
 Mineral, oil, gas and other natural resource deposits.
 Destruction of fishing and other natural resources, deforestation and depletion.
 Floods, storms and other natural disasters (such as global warming) due to human
impact on ecosystems
 Climate change, droughts and food shortages can lead to social unrest and
international conflict.
 Section-B

Question 1)
SWOT Analysis of the Indian Economy
The four key features of a SWOT study are Strengths, Weaknesses, Opportunities, and
Threats. This type of study considers the subject’s or organizations internal and external
aspects. Internal factors determine the strengths and weaknesses of a business. External
dimensions, on the other hand, describe opportunities and risks.
This was a quick overview of the SWOT review. It can be prepared for any market review or
topic as well as people’s overall strategic role. However, it has been chastised for its
shortcomings.

Strengths in the SWOT analysis of Indian Economy

1) Largest Labour Force-According to 2012 Labour Department data, 487 million workers,
including non-organized and organized sectors. But, as expected, it can reach 695 million by
2020.

2) "Agriculture-India is the second largest farm producer in the world. According to 2018
economic data, agriculture employs more than 50% of India's workforce and 17-18% of
national GDP. (Kumar)

3) “Agricultural or arable land area—394.6 million acres of arable area (second only to the
United States) and 215.6 million acres of irrigated crop area (The largest in the world) ".
(Kumar)

4) English-speaking Population-According to government data, 125 million people use

English in India (the second largest English-speaking country after the United States).
Therefore, skilled personnel can be easily assigned.

5) Technology Graduation / Higher Education-According to 2014 research materials, 25% of

the world's science and engineering graduates are from India. However, we are short of
researchers.

6) Foreign Direct Investment (FDI) --According to the financial era, India became the
number one destination for foreign direct investment in 2015, creating 10 million jobs in
India.

7) "Foreign Currency Reserves - India is the 6th largest foreign exchange holdings, with
$481.78 billion as of May 1, 2020." (Kumar)

8) “India’s main natural resources – India’s main mineral resources are coal (the fourth
largest in the world), iron ore and manganese ore (the seventh largest in the world as in
2013), mica, bauxite (5th largest in the world, as in 2013), chromite, limestone, natural gas,
diamond, crude oil, thorium, etc. "

9) India's economy ranks fifth in the world in nominal GDP and in purchasing power parity
third is the economy. And it is one of the fastest growing economies beyond China.

10) Goods and Services Tax (GST) - effective July 2017. It includes 17 taxes imposed by the
central and state/UT governments. The One Country One Tax aims to increase India's
competitiveness in the global market.

Weaknesses in the SWOT analysis of Indian Economy

1) Low literacy rate-Literacy is the key to socio-economic development in all countries. In
2018, according to government data, the literacy rate in India is 74.4% (122nd in the world).

2)”Rural and urban inequality-Urban population increased from 17.1% between 1950 and
2015 to 29.2 tons. On the other hand, the rural population decreased from 82.9% between
1950 and 2015 to 67.2 tons. This leads to life inequality. Standard " (Kumar)

3) Low productivity in India - The reasons for low productivity in India (agriculture) are as
follows.
Overpopulated
Uneconomical holdings (land)
Uncertain monsoons and insufficient irrigation
Degradation of soil fertility
Lack of support services
Insufficient management of resources and entrepreneurship

4) Population Many - high population disadvantaged population

Low per capita income
Low availability of necessities per capita
Population pressure on land
Rise of unproductive consumers
High unemployment
Degradation of quality of life
Deterioration of environment
Increase in public services
Savings, investment, Capital Growth

5) “High Population below Poverty Line – According to the World data lab poverty
estimate index for India is 4.3% for rural area and 3.8% for urban area (As per 2018 data)”.
(Kumar)

6) “Unemployment Rate – According to CMIE Employment Rate data of India is 24.8% (As

per 9th May 2020)”. (Kumar)

7) The labour force participating in the agricultural sector contributes only 17% of GDP.
8) Insufficient infrastructure for critical services such as health, education and transportation.
9) Imports and Exports - Imports of goods and services are higher or doubled compared to
exports that directly affect the economy

10) “Non-Performing Assets (NPAs) – According to the government data, public sector
banks NPAs is around Rs 7.27 lakh crore as on 30th September 2019”. (Kumar)

Opportunities in the SWOT analysis of Indian Economy

1 Great opportunity in agriculture and allied areas such as livestock, forestry and fishing
made 18% of GDP.

2) “Tourism – Over 10 million foreign tourists arrived in India in 2017 as compared to 8.89

million in 2016, representing a growth of 15.6%. Huge scope available in this sector”.
(Kumar)

3) Need foreign direct investment in many areas or must increase FDI capital in many areas.

4) Manufacturing / service industry - Great opportunities for investments and new risks in the
field of manufacturing and service because we only depend on foreign imports for many
products and services.

5) NRIS population abroad - the higher NRIS number is to directly increase the foreign
currency reserves of India.

6) “High Opportunity in IT and ITES sector for foreign currency earnings”. (Kumar)

7) Reformed reform in insolvency law (for NPA also).

8) You must stabilize the agreements free trade in developed and growing countries.

Threats in the SWOT analysis of Indian Economy

1) “Global Slowdown/Recession – Due to the Covid-19 Pandemic, we are already facing a
recession/slowdown in mostly sectors. This is the one of the biggest threat right now for
Indian economy”. (Kumar)

2) “Increasing Imports – One of the biggest threat is to growing imports  as compared to
exports which makes the negative trade balance of $125B (As per 2017, Imports = $417B,
Exports = $292B)”. (Kumar)

3) Agriculture, the largest employee sector, mainly depends on Monsoon.

 4) Population growth - This country has doubled in size in just 40 years and will not take on
the most populous country over the next few decades. The growth rate of India is about 1%
(current).

5) Crude oil - we depend mainly from abroad and a very volatile field is very much.

6) High financial deficit - currently the financial deficit is about 5.07% of GDP.

7) “GDP Growth Rate – One of the biggest threats is to maintain the constant GDP growth
rate (After the Covid-19 Pandemic)”.

Conclusion
Economic Survey 2019-20 proposed some reforms that the government should prioritize. The
main items are as follows.
• An easier way to start a new business, pay taxes and enforce a contract.
• Launch Chinese model for job creation.
• Supports start-ups.
• Make in India Promotes the movement.
• Create a clean, enhanced, efficient energy system and a progressive transportation network.
• To increase the availability of cheap food.
• Increase the growth of agriculture and industry.
• Reform also proposes to climate change.
• To maintain and achieve continuous GDP growth.
Question 2)
How governments intervene in business practices?

The government intervenes in the market to resolve inefficiencies. In an optimally efficient

market, resources are fully allocated to those who need as much resources as they need. Not
so in an inefficient market. Some may be too resource-rich and some may not be sufficient.
Inefficiencies can take many forms. The government is using regulations, taxes and subsidies
to eliminate these inequalities. Most governments have a combination of four purposes when
intervening in the market.

We can also expect governments to play a more active role in reconciling public and private
interests through rules on how companies and individuals are compensated. For example,
credit rating agencies have long been paid by the issuer of rating securities rather than by the
institution using the rating.

“Finally, governments will move to harmonize their coaxing mechanisms across borders. The
global meltdown has starkly illustrated the interconnectedness of global capital and unleashed
demands for more uniform and rigorous international standards for financial reporting and
auditing, and for corporate taxes. The additional necessities of addressing climate change and
ensuring the safety of food, drugs, and other products moving in international commerce will
spur further efforts toward uniform rules”. (Reich)

Maximizing Social Welfare

In unregulated and inefficient markets, cartels or other types of organizations exercise their
monopoly power and limit the development of infrastructure, raising the cost of participation.
Without regulation, businesses are likely to have negative externalities with no consequences.
This leads to the reduction of all resources, the inhibition of innovation, and the minimization
of trade and its benefits. Government intervention through regulation can address these issues
directly.

Macro-Economic Factors

The government will also intervene to minimize the damage caused by naturally occurring
economic events. The downturn and inflation are part of the natural business cycle, but they
can have a fatal impact on citizens. In this case, the government intervenes through subsidies
and money supply operations to minimize the harsh impact of economic power on voters.

Socio-Economic Factors
Governments can also intervene in the market to promote general economic equity.
Governments often seek to redistribute resources to the richest and most supportive of them
through taxation and welfare programs. Other examples of market interventions for socio-
economic reasons include employment laws to protect certain parts of the population and
regulations on the manufacture of certain products to ensure the health and well-being of
consumers.

Other Objectives
Governments can occasionally intervene in the market to promote other objectives such as
national integration and development. Most people agree that the government must provide
an army for the protection of its citizens, which can be seen in this kind of intervention.
Growing a large and impressive army can not only increase national security, but can also be
a source of pride. Intervening in a way that promotes national unity and pride can be a very
valuable goal for civil servants.

Government intervention supporters defend the use of various economic policies to

compensate for flaws in the economic system that lead to major economic imbalances. They
believe that the law of supply and demand is not sufficient to balance the economy and
requires government intervention to ensure the proper functioning of the economy. 

“Examples of these economic doctrines include Keynesianism and its branches such as New

Keynesian Economics, which relay heavily in fiscal and monetary policies,
and Monetarism which have more confidence in monetary policies as they believe fiscal
policies will have a negative effect in the long run”. (Gallego) On the other hand, there are
other economic schools that believe that governments should not have an active role in the
economy, and therefore should limit its intervention, as they believe it will have a negative
impact in the economy. “They believe that the economy should be left to run in a laissez-
faire way and it will find its optimal equilibrium. Advocates of none or limited intervention
include liberalism, the Austrian school and New Classical Macroeconomics”. (Gallego)

“As in most imperfect competition markets and especially in monopolistic ones, a firm may

practice an abusive behaviour, which will translate into a loss of welfare. In such cases,
government intervention will be praised both by consumers and those firms that seek for
lower prices and a profitable share of the market. Regulations such as price
setting, taxation or subsidies may be used in order to restore and maximise the initial
efficiency of natural monopolies”. (Gallego)

Nevertheless, governments should be careful when setting up and applying regulations, as

misunderstandings of market structures can result in high costs for social welfare rather than
expected benefits. “In order to achieve an optimal regulation level, governments should
analyse and determine if natural monopolies can be sustained whenever they ensure a lower
total cost. If this is the case, the government will have to guarantee that the firm does not
make excessive revenues, and that fair prices are maintained”. (Gallego)

If, on the contrary, the total costs of the industry would diminish if new firms entered the
market, the government should regulate their entrance. Essentially, what governments should
do is to correctly balance the conflict between the industry’s efficiency and its profitability.
 Works Cited

1. Thomas, Stephen. "4 Types Of Market Segmentation With Real-World

Examples | Yieldify". Yieldify, 2020, https://www.yieldify.com/blog/types-of-
market-segmentation/. Accessed 11 June 2020.
(Thomas)

2. Wozniak, Krzysztof. "Ecological Factors Affecting Business". Ceopedia |

Management Online,
https://ceopedia.org/index.php/Ecological_factors_affecting_business.
Accessed 11 June 2021.
(Wozniak)

3. Kumar, Ajay. "SWOT Analysis Of Indian Economy - SRT News". SRT News,

https://srtnews.net/swot-analysis-of-indian-economy/. Accessed 10 June 2021.
(Kumar)

4. Reich, Robert. "Government In Your Business". Harvard Business Review,

2009, https://hbr.org/2009/07/government-in-your-business. Accessed 12 June
2021.

(Reich)

5. Gallego, Lope. "Government Intervention |

Policonomics". Policonomics.Com, https://policonomics.com/government-
intervention/. Accessed 13 June 2021.

(Gallego)

6. (PDF) Bedekar, Diksha. Segmentation & Business Marketing.

https://1drv.ms/p/s!AsM-X_e1dAZRhV3nZ9kW4o1xfolZ. Accessed 12 June
2021.
(Bedekar)