MARKETING MANAGEMENT

ANS 1.
INTRODUCTION: PRODUCT MIX PRICING STRATEGY
M/S Herbal Life sells various FMCG products in urban market. These products can be put under
the category of Herbal products. When a company sells more than one product together, they fall
in the category of Product-mix. So here it is challenging for a company to decide its pricing
strategy in such a manner that it can capture maximum market share. So the products which
customers tend to buy together can be put under one category while adopting a suitable Product
mix price strategy. It leads to increase in company’s profits as well as customer building.
DISCUSSION
So, let us discuss about various Product Mix Pricing Strategies that a company can adopt:
1. Product line pricing
2. Optional-product pricing
3. Captive-product pricing
4. By-product pricing
5. Product bundle pricing

1. PRODUCT LINE PRICING-

Companies develops the product line pricing but not the single product pricing. Based
upon several factors like competitor’s product price, customer’s value for product,
different levels of customers in market etc , company determine the price steps between
different products in product line. In case of M/S Herbal Life, they may set price for their
different range of shampoos, toothpaste etc considering all above factors.

2. OPTIONAL PRODUCT PRICING-

Under this strategy, company can put a main product and an optional product together and set
their price. Company can analyze which products are bought generally together, and which
product is bought as an option with the main product. So the company needs to decide on its base
product and optional product. For example , toothpaste and toothbrush are sold together.

3. CAPTIVE PRODUCT PRICING-

Under the strategy of Captive product pricing, company puts two such products together where
one is main product and other one must be bought to use the first one. Here generally the price of
main product is lesser than that of the captive product. Customer has no choice but to buy them
together. But company must set the price strategy very carefully, as the customer who got
trapped to buy expensive captive product may resent the brand.

4. BY-PRODUCT PRICING-
In the process of producing the main product, some by-products may be obtained. It may be a
costly affair for the company to dispose them off, so company adopts this strategy where they
sell the by-product along with main product. Here the price of main product is made more
competitive. Sometimes it may turn out really profitable for the company. So it is like turning
trash to cash.

5. PRODUCT BUNDLE PRICING-

Under this strategy, company may put together a few products together which they think
customers would buy together but company tries to keep the price on lower side otherwise
customers would end up buying single product instead of buying the bundle of products. Here
company can include such products as part of bundle which are otherwise bought less by
customers in the market. Herbal Life company can bundle up shampoo, conditioner and hair oil
in this category. It enhances the sales and increase the profits of the company. Sometimes
customers like the products so much that they start buying some of those as individual products
also.

PRICE ADJUSTMENT STRATEGIES:

Companies set a base price of their product in initial stages but they adjust prices account to
customer differences and situations. There are following price adjustment strategies which
Herbal Life co. can adopt in later stages:
1. DISCOUNT AND ALLOWANCE PRICING
Companies offer discount and allowances to their customers under this strategy. Actually they
reward their customers for their responses. For example, if they make minimum purchase of Rs
599 some discount is given or sometimes a free sample product is given. This is really beneficial
for the company as well the customers.

2. SEGMENTED PRICING
Under segmented pricing, company adjusts the basic price based on different segments like
different customers, different locations etc.
Company can charge different prices from different customers for the same product, or from
different locations they may charge different prices for the same product. Herbal Life company
can do market survey to adopt this strategy.

3. PSYCHOLOGICAL PRICING:
This price adjustment strategy uses the psychology of the customers. It is about psychology not
economics. Generally, the high priced goods look appealing to the customers when it comes to
the quality of products. So, customers who value quality over price buy such products.
Customers do not have resources or time to find out whether product A or B is better, so they
make their decisions based on the pricing of the products.

4. PROMOTIOINAL PRICING:
Promotional pricing can be temporarily used by the companies. Products are priced below their
list price and sometimes even lower than the cost. This strategy may be adopted to increase short
run sales. Discounts are given. Generally, customers wait for brands to go for discounts and
sales. This strategy may be adopted in specific seasons, or may at such times when company
intends to clear off the old stuff. But it must be cautiously used as the prices may be below the
cost sometimes.

5.GEOGRAPHICAL PRICING:
Under this strategy, company must decide whether it will charge the uniform price of their
products from customers based in country or worldwide. This decision must be made with
utmost care. So if Herbal Life company wants to sell its products in different states in India, it
must make its decision after considering all factors.

CONCLUSION:
M/S Herbal Life first, needs to decide on base pricing for their products, using Product Mix
pricing strategies. For FMCG products it is quite beneficial for such companies to use Product
Bundle pricing, captive product pricing and optional product pricing. These strategies will guide
the company to set on base pricing. In later stages, the company may adopt Price adjustment
strategies to increase their profits, to capture a market share, to make their product known to
many customers in different locations. So, this company can use Promotional pricing strategies,
discount and allowance pricing strategy, segmented price strategy but after analyzing different
factors.
ANS 2.
INTRODUCTION:
Not even any superior products sell by itself. Potential customers need to be informed about the
product, its features and benefits using different ways. This whole process is referred to as
promotion-mix. Herbal Life company wants to promote its products and it should be done in
such a manner that it becomes a household product. In initial stages, company should focus and
produce few products in product line. Slowly and gradually, it can add more products to its
product mix. It can adopt powerful promotion tools as discussed further.

CONCEPT AND APPLICATION

It is vital that company adopts right promotional strategy to-

Capture the attention of right group of customers
Inform them about product features and uses
Influence them to buy the product.

PROMOTION MIX TOOLS-

Herbal Life can adopt the following promotion mix strategies:
1. Advertising
2. Sales promotion
3. Personal selling
4. Public relations
5. Direct and digital marketing
How the company integrates the above techniques depends on what the company wants
to promote or what the potential buyers are looking for. Let us study in detail-

1. ADVERTISING:

It is a non-personal presentation of ideas, goods or services. It is non-personal because there

is no direct contact with customers at the time of communication. It includes TV
commercials, radio announcements, print media i.e. news papers, journals, billboards etc. It
is an age old technique but still powerful. With time, it has changed but still connects
 millions of people. If Herbal Life wants to become a household product, this is going to be
one of the best tool. Marketing management must make four decisions while making an
advertising plan-
a) Setting advertising objectives
b) Setting advertising budget
c) Developing advertising strategy
d) Evaluating advertising effectiveness
The benefits of advertising are-
 The message can be repeated frequently which enables the customers to watch
and hear it again and again. The right timing can increase awareness.
 Effective advertising can create and nurture brand equity.
2. SALES PROMOTION:

Sale promotion activities are vital tools of promotion. It is basically used to attract more
customers and increase sales in short term.
Customer oriented sales promotion involves engaging and encouraging individual customers. It
includes rebates, allowances, free sample products, coupons etc. It aims at stimulating immediate
sales.
Retail-oriented sales promotion includes visual merchandising. Window displays outside the
stores attract the customers.
Trade-oriented sales promotion targets intermediaries, retailers, distributors etc. It includes trade
shows, merchandising allowances, price deals etc.
Sales promotion aims at the following:
a) Attract customers to use and buy product more frequently
b) Transform potential customers into actual customers
c) Encourage retailers to carry more inventory

3. PERSONAL SELLING:

Personal selling involves human factor into selling. Here salesman in showroom plays important
role. So much depends on his capabilities.
There are two types of salespeople, order getter and order takers. Order getters will influence
the customers tactfully and get the order for the product whereas the order takers are those who
wait for customers to find them.
Personal selling is adopted by companies who sell expensive or technical products.
4.PUBLIC RELATIONS:

Another important tool for promotion , public relations involves building good customer
relations with company’s publics. it is non paid media coverage.It creates a goodwill of
the company.
Publicity is free advertising. Most common form here is press release. It involves the
following functions-

 Creating newsworthy information in the news media to attract custromers.

 To publicize the product.
 Building community relationships
 Building relationships with government officials.
 Maintaining relations with financial community.

5.DIRECT AND DIGITAL MARKETING:

It is about engaging directly with target consumers. It enables the company to directly
contact the customers e.g. greeting them with a letter or telephoning them directly.
Direct marketing depends on whether a company can contact its customers directly to
establish its data base.

CONCLUSION:

Herbal Life company’s promotion mix may be a blend of five – advertising, personal
selling, sales promotion, public relations and digital marketing. Company can start with
sales promotion techniques in initial stages that includes free samples, buy one get one
products, any allowances, rebates etc. these are short term techniques to increase sale.
Further company can focus on personal selling by hiring good salesman who actually
convince the customers to buy its products.
Advertising through media can be of great help. Depending on company’s policy
advertising media can be selected. It may include study of various factors.
Public relations focuses on building good customer relations.

ANS 3(A)
INTRODUTION:

Consumer buying behavior is different when consumer is buying habitual goods or

expensive goods or infrequent goods. For example, buying salt doesn’t involve customer
involvement. Buying a new phone with latest features is dauntingly complex. It needs
customer involvement. So while buying a phone the procedure consists of five stages.
 1. Need recognition
2. Information search
3. Evaluation of alternatives
4. Purchase decision
5. Post purchase behavior
DISCUSSION
Consumers pass through above five stages while making a buying decision. Buyers may pass
quickly or slowly through this process depending upon what they are buying. For example
customer buying a soap will recognize the need of buying it and quickly make a decision to buy
without information search or evaluation. Whereas a consumer buying a new phone will go
through all five stages slowly.

1. NEED RECOGNITION
The first stage is where the consumer recognizes the need of buying a product. It may be due to
his own wish or desire i.e. some inner urge or drive due to which he wants to buy a product. It
may be an external-stimuli. For example someone’s friends suggested to buy a new phone.

2. INFORMATION SEARCH
A customer who is strongly interested to buy a product will collect all possible information about
the product. For example, if customer has decided to buy a phone he will pay more attention to
the ads, he may speak to friends who are already using latest mobiles etc.
Customers can obtain information from several sources.
Personal sources like family, friends, neighbors etc.
Commercial sources like dealers, advertising, salesperson.
Public sources like mass media, social media, online search etc.
Experiential sources i.e.examining and using the product
Nowadays, customers share their reviews on social media which helps the people to make their
decisions whether to buy a particular product or not.
If Raj is looking for a phone, he will collect information from all possible sources discussed
above. Also his own past experiences will guide him which one he should buy next.

3. EVALUATION OF ALTERNATIVES:
From different sources consumers collect information about the different brands available. At
this stage, consumers process information to choose among alternative brands. Consumers may
not use a single and simple evaluation process in all buying situations.
It depends upon individual consumer and the specific buying situation. In some cases, consumers
are calculative and think logically whereas they may not do any evaluation in some cases. They
may buy impulsively.
For example, after collecting information Raj has two alternatives that is iphone 14 pro max and
pixel 7 pro. Next he may be interested in attributes like camera performance, battery life,
processor performance, phone storage. Depending on the requirement, Raj may decide to buy
one of his choice.

4. PURCHSE DECISION:
Consumer ranks brand during evaluation process and makes his decision of buying. Generally,
consumers buy the most preferred brand, here two factors come in picture-
Intention and purchase decision.
First factor is other people’s attitude. If someone in Raj’s family thinks that he should not buy
expensive phone then chances of Raj buying low price phone will be more.
Second factor is unexpected situational factor. It is based on the factors like expected income,
expected price, expected product benefits. Some unexpected events may change Raj’s decision.
For example, some competitor might reduce the price, some lose friend may share bitter
experience of the shortlisted phone etc. So, preferences and purchase intentions may not result in
buying.

CONCLUSION-

Raj may decide on buying the best suitable out of the two models.
Both of the models have almost the same screen size. Pixel has 12GB RAM and iphone 12 has
6GB RAM. Both has128GB base storage. Triple camera lens on both, pixel has 5X tele lens
whereas iphone has 3X tele lens. Cost wise, iphone is costlier.

ANS 3(B)
INTRODUCTION
Global Stock is an online app for the purchase of international stocks from international market.
It may help the investors to buy and invest conveniently from their home country. App store and
Google store has millions of apps available and this number is growing day by day. Top rated
apps on Google play are Tiktok, facebook, whatsapp, Telegram, Instagram, Netflix – to name a
few. So it is not easy to be recognized on play store and to become people’s favourite.
Let’s talk about some ways through which an app can be promoted.

DISCUSSION
1. IMPLEMENTING A SEARCH ENGINE OPTIMIZATION STRATEGY
Search Engine Optimization helps the potential users to find the app through search. It takes a lot
to develop SEO strategy. Use relevant keywords on website or app. On the landing page, post the
link of app so that users can easily download the app on their preferred device. Enlist the help of
third-party vendor that specializes in driving website traffic.

2. IMPLEMENT AN APP STORE OPTIMIZATION STRATEGY

Reach out app users in place where they download new apps. So invest in App Store
Optimization. To make a presence in App Store, user reviews must be obtained from active
users. Send these reviews on app store, post lots of images of user’s experience of the app – use
app screenshots and video. Always keep the app name, icon and app description updated.

3. PAID PROMOTIONS IN APP STORE

Another promotion strategy is to place your app in app store. Paid promotions can be purchased
in app store. It can be noticed by maximum users. Once it gets established then paid promotions
can be stopped and now focus can be shifted on retaining the customers and organic user
acquisition.

4. SOCIAL MEDIA MARKETNG

Social media is much popular in modern times. So, not only search engines but try to place the
place on social media platforms. Social media platforms have information about their users like
their interests, geographical region etc. Due to this reason this is more effective than paid ads.
While placing the app on social media platforms, keep the relevant pages up to date.

5. HIRE INFLUENCERS:
Hiring influencers can help the visibility of the app among potential customers. There are
bloggers and social influencers who already have a big list of subscribers or fans, so these
influencers can be of great help. These social media influencers can be paid a flat fee or
commission in return of their services.
CONCLUSION

Other than above listed five methods there are several more strategies to promote an app like
sharing some content or logo related pictures on Pinterest, contacting your local community,
offer free trials, join LinkedIn groups, run ad campaign on Facebook. There are several more
ways to bring an app into notice. This is how a business of international stocks can be
highlighted on an app.