Internal Assessments

Program – MBA Program

Subject – Marketing Management

Semester - 3

Assessment Type – (Subjective Assignment)

Questions & Answers:

1. Why should the marketer create an experience aroud the product?

Creating an experience around a product is crucial for marketers because it
offers several advantages and benefits. Here are some reasons why marketers
should focus on creating a compelling product experience:

Differentiation: In today's competitive marketplace, products alone often do not

provide sufficient differentiation. By creating a unique and memorable experience
around the product, marketers can set their brand apart from competitors. A
remarkable experience can become a key differentiating factor, attracting customers
and fostering brand loyalty.

Emotional Connection: Experiences have the power to evoke emotions and create a
strong emotional connection with customers. When customers have a positive
emotional experience associated with a product, they are more likely to form an
emotional bond with the brand. This emotional connection leads to increased
customer loyalty, advocacy, and repeat purchases.

Enhanced Perceived Value: By creating a holistic experience, marketers can enhance

the perceived value of the product. Customers are not just purchasing the tangible
features or benefits; they are buying into the entire experience that comes with the
product. A well-crafted experience can make customers feel that they are getting
more value for their money, leading to increased customer satisfaction and
willingness to pay a premium.

Customer Engagement: An experiential approach encourages active customer

engagement. When customers are engaged in a positive experience, they become
active participants rather than passive consumers. This engagement can result in
increased brand interaction, word-of-mouth referrals, and social sharing, amplifying
the reach and impact of the brand.

Storytelling and Brand Narrative: Creating a compelling product experience provides

an opportunity for marketers to tell a story and shape the brand narrative. A well-
crafted experience can communicate the brand's values, mission, and unique selling
propositions in a more engaging and memorable way. This storytelling approach
helps customers connect with the brand on a deeper level, leading to stronger brand
associations and brand loyalty.
Repeat Business and Customer Loyalty: When customers have a positive experience
with a product, they are more likely to become repeat buyers and loyal advocates.
By consistently delivering exceptional experiences, marketers can build long-term
relationships with customers, resulting in increased customer lifetime value and
reduced customer churn.

Competitive Advantage: An experiential approach provides a competitive advantage

by focusing on the overall customer journey rather than just the transaction. By
prioritizing the customer experience, marketers can create a sustainable competitive
advantage that is difficult for competitors to replicate. This advantage becomes even
more significant in industries where products can be easily commoditized.

Overall, creating an experience around the product allows marketers to go

beyond functional benefits and engage customers on an emotional level. By
delivering a unique and memorable experience, marketers can differentiate their
brand, build customer loyalty, increase perceived value, and ultimately drive
business growth.

2. What is the significance of product in 4P’s of marketing mix?

In the 4P's marketing mix framework, the product is one of the fundamental
elements and holds significant importance. The marketing mix concept, developed
by marketer E. Jerome McCarthy, outlines the key components that a company can
control to influence its marketing strategy. The 4P's refer to Product, Price, Place,
and Promotion. Here's the significance of the product within this framework:
 Product
 Price
 Place
 Promotion

Foundation of Value Creation: The product is the core offering that a company
brings to the market. It represents the tangible or intangible item that satisfies
customer needs or wants. The product's features, design, quality, and performance
are the foundation of value creation. A well-designed and desirable product can
provide a competitive advantage and differentiate the brand from competitors.

Customer Satisfaction and Needs Fulfillment: The product is developed to meet

specific customer needs or desires. By understanding the target market's
preferences, marketers can design and deliver a product that satisfies those needs
effectively. Meeting customer expectations and delivering value through the product
is crucial for customer satisfaction and building long-term relationships.

Differentiation and Competitive Advantage: The product plays a vital role in

differentiating a company's offering from competitors. Unique features, innovative
designs, superior quality, or specialized functionalities can set a product apart in the
market. Effective differentiation helps the product stand out and creates a
competitive advantage, enabling the company to capture market share and
command premium pricing.

Product Portfolio Management: Within the marketing mix, the product also includes
product portfolio management. This involves managing the assortment of products
offered by a company, including product lines, variations, and extensions. A well-
structured product portfolio strategy ensures that a company addresses different
customer segments, cater to varying needs, and capitalize on market opportunities.

Lifecycle Management: The product's lifecycle, from introduction to decline, is a

critical consideration in marketing strategy. Understanding the product's lifecycle
stage helps marketers plan appropriate strategies for each stage. Whether it's
launching a new product, growing market share, or managing the decline, the
product's lifecycle guides decisions on pricing, promotion, distribution, and
innovation.

Branding and Brand Equity: The product is closely tied to branding and brand equity.
A strong and reputable brand enhances the perception of the product and influences
customer preferences. The product serves as a tangible representation of the brand
promise, values, and identity. Consistency in delivering quality products under the
brand reinforces customer trust and loyalty.

In summary, the product is a crucial element in the marketing mix framework

because it serves as the foundation of value creation, fulfills customer needs, drives
differentiation, and provides a platform for branding and competitive advantage. By
focusing on product development, design, and management, companies can create
offerings that meet customer expectations, build strong brands, and achieve
business success.

3. “Demographic characteristics strongly affect buyer behaviour.” Explain the

statement?
The statement "Demographic characteristics strongly affect buyer behavior"
suggests that various demographic factors associated with individuals or groups have
a significant influence on how they behave as consumers. Demographic
characteristics refer to quantifiable attributes of a population or market segment,
such as age, gender, income, education level, occupation, ethnicity, and family
structure. These characteristics play a crucial role in shaping consumer preferences,
purchasing decisions, and consumption patterns. Here's an explanation of how
demographic characteristics impact buyer behavior:

Age: Different age groups tend to have distinct preferences, needs, and purchasing
behaviors. For example, teenagers and young adults may be more inclined towards
trendy fashion, technology products, and experiences, while older adults may
prioritize health-related products, retirement planning, and leisure activities.
Marketers often tailor their strategies and products/services to cater to specific age
groups.
Gender: Gender can influence consumer behavior as it often correlates with
different preferences, interests, and social roles. For instance, there are gender-
based preferences in clothing, cosmetics, personal care products, and even buying
patterns related to household goods. Marketing campaigns often target specific
genders to appeal to their unique needs and desires.

Income: Income level significantly impacts purchasing power and spending habits.
Consumers with higher incomes may be more willing to spend on luxury goods,
premium brands, and upscale experiences, while those with lower incomes may
prioritize value-oriented products, discounts, and budget-friendly options.
Understanding income levels helps marketers position their offerings accordingly.

Education Level: Education level can affect buyer behavior by influencing consumers'
knowledge, awareness, and perception of products and services. Highly educated
individuals may engage in more research, seek detailed information, and make
informed decisions. They may also be more receptive to innovative or specialized
products. In contrast, consumers with lower education levels may rely more on
personal recommendations or traditional marketing channels.

Occupation: Occupations and professional roles can shape consumer behavior by

influencing income levels, work-related needs, and lifestyles. For example,
professionals in creative industries may have preferences for artistic or design-
oriented products, while healthcare professionals may have specific requirements
related to medical equipment or healthcare services.

Ethnicity/Culture: Cultural and ethnic backgrounds can play a significant role in

shaping consumer behavior. Different cultural values, traditions, and norms can
impact preferences for food, clothing, music, and even communication styles.
Marketers often consider cultural diversity to develop effective strategies for specific
ethnic or cultural groups.

Family Structure: Family composition, such as marital status, presence of children,

and household size, can influence buying decisions. For example, parents with young
children may prioritize child-related products and services, while empty nesters may
focus on retirement planning or travel. Understanding family dynamics helps
marketers tailor their messaging and offerings accordingly.

These are just a few examples of how demographic characteristics influence

buyer behavior. By analyzing and understanding the demographic makeup of their
target market, businesses can effectively segment their audience, customize
marketing strategies, develop relevant products, and create compelling messaging
that resonates with the specific needs, values, and preferences of different
demographic groups.
4. What are the choice criteria that a customer uses in evaluating products?
Customers typically employ various criteria to evaluate products before
making a purchase decision. These criteria can vary depending on the product
category, individual preferences, and specific circumstances. Here are some common
choice criteria that customers use when evaluating products:

Price: Price is a significant factor in the evaluation process for many customers.
Customers consider whether the price aligns with their perceived value of the
product and fits within their budget. They compare prices with competitors'
offerings and assess the affordability and cost-effectiveness of the product.

Quality: Quality refers to the level of excellence or superiority of a product.

Customers evaluate the quality based on factors such as durability, reliability,
performance, craftsmanship, materials used, and overall satisfaction. Positive
perceptions of quality can enhance the perceived value of a product.

Features and Functionality: Customers assess the features and functionality of a

product to determine if it meets their specific needs, preferences, and desired
outcomes. They evaluate how well the product performs its intended purpose, the
availability of desired features, ease of use, versatility, and compatibility with other
devices or systems.

Brand Reputation: The reputation and credibility of a brand can significantly

influence a customer's evaluation. Customers often consider the brand's track
record, customer reviews and ratings, brand image, past experiences with the brand,
and its perceived trustworthiness. A strong brand reputation can instill confidence
and positively impact the purchase decision.

Customer Reviews and Recommendations: Customers often rely on reviews, ratings,

and recommendations from other customers, both online and through personal
networks. They consider the experiences and opinions of others to assess the
product's quality, reliability, and suitability for their needs.

Design and Aesthetics: The design and aesthetics of a product can play a crucial role
in the evaluation process. Customers may prioritize visual appeal, stylishness,
uniqueness, and how well the design aligns with their personal tastes and
preferences.

Convenience and Ease of Use: Customers consider factors such as convenience, ease
of use, installation, maintenance, and after-sales support. Products that offer
simplicity, intuitive interfaces, clear instructions, and responsive customer service
may be favored.

Environmental Impact: Increasingly, customers are considering the environmental

impact of products in their evaluation process. Factors such as sustainability, eco-
friendliness, recyclability, energy efficiency, and ethical sourcing may influence their
decision-making.
Social Factors: Customers may also consider social factors, such as how the purchase
aligns with their values, social responsibility, and ethical considerations. They may
evaluate whether the product is produced under fair labor conditions, supports
charitable causes, or contributes to the community.

It is important to note that customers may prioritize these criteria differently

depending on the context and their personal preferences. Moreover, the importance
of specific criteria may vary across different product categories and customer
segments. Understanding customer needs and preferences and aligning products
with their choice criteria can help businesses meet customer expectations and
differentiate themselves in the market.

5.What are the steps involved in demand forecasting?

Demand forecasting is the process of estimating the future demand for a

product or service. It helps businesses make informed decisions regarding
production, inventory management, resource allocation, and overall business
planning. While specific approaches may vary depending on the industry and
context, here are the general steps involved in demand forecasting:

 Define the Purpose

 Gather Historical Data
 Clean and Analyze the Data
 Select Forecasting Methods
 Implement Forecasting Models
 Monitor and Refine the Forecasts
 Incorporate External Factors
 Review and Update the Forecasts
 Collaborate and Communicate

Define the Purpose: Clearly define the purpose and scope of the demand forecasting
exercise. Determine the specific questions you want to answer or decisions you need
to make based on the forecast. For example, are you forecasting demand for a new
product launch, production planning, or inventory management?

Gather Historical Data: Collect relevant historical data on sales, customer orders,
market trends, and other factors that influence demand. The data should cover a
significant time period and be as accurate and detailed as possible. Ensure the data is
reliable and reflects the specific market conditions during the period.

Clean and Analyze the Data: Clean and preprocess the data to remove any
anomalies, errors, or outliers that may skew the forecast. Analyze the data to
identify patterns, trends, and seasonality if applicable. Statistical techniques such as
regression analysis, time series analysis, or smoothing methods may be used to
identify and model patterns in the data.
Select Forecasting Methods: Based on the data analysis and the nature of the
demand pattern, select appropriate forecasting methods. There are several
techniques available, including qualitative methods (e.g., expert opinion, market
research, customer surveys), quantitative methods (e.g., time series analysis, causal
forecasting), or a combination of both.

Implement Forecasting Models: Implement the selected forecasting models and

algorithms to generate forecasts. This may involve using software tools or statistical
packages that automate the forecasting process. Ensure that the models are
properly calibrated and validated to provide accurate and reliable forecasts.

Monitor and Refine the Forecasts: Continuously monitor the accuracy of the
forecasts by comparing them to actual demand. Evaluate the forecast performance
using appropriate metrics such as mean absolute percentage error (MAPE) or mean
squared error (MSE). If the forecasts consistently deviate from actual demand, refine
the models or techniques accordingly.

Incorporate External Factors: Consider external factors that may impact demand,
such as economic indicators, market trends, competitor actions, or regulatory
changes. These factors should be incorporated into the forecasting models or used
to adjust the forecasts based on expert judgment or market insights.

Review and Update the Forecasts: Regularly review and update the forecasts based
on new data, market changes, or other relevant information. Demand patterns may
evolve over time, and updating the forecasts ensures their relevance and accuracy.

Collaborate and Communicate: Involve relevant stakeholders such as sales teams,

marketing, operations, and finance in the demand forecasting process. Share the
forecasts and collaborate to align business strategies and plans based on the
forecasted demand.

Demand forecasting is an iterative process that requires continuous

monitoring, analysis, and adjustment. By following these steps and utilizing
appropriate forecasting techniques, businesses can make more informed decisions,
optimize resource allocation, improve inventory management, and enhance overall
operational efficiency.