Course MBA – 2nd Semester
Subject: Marketing Management
Assignment MB0046 – Set 1
Q.1
a. Explain the different micro-environmental forces with examples.
Forces in the micro environment
1 The Company
Remember, in the previous unit we discussed about marketing mix and marketing plan. Safe Express, a leader in the supply chain management solution wants to hold its number one position in the US $ 90 billion Indian logistics market. The company plans to expand its service areas in the coming months. To meet the targets of the marketing plan, other departments of safe express also expanding their horizon. The Company is coming out with logistics parks in different cities; plans to hold seven million square feet of warehousing capacity in the next three years and invest Rs 10 billion in three years to meet those targets. The above example shows that the company’s marketing plan should be supported by the other functional departments also.
2 Intermediaries
Marketing intermediaries: These are firms which distribute and sell the goods of the company to the consumer.
Marketing intermediaries play an important role in the distribution, selling and promoting the goods and services. Stocking and delivering, bulk breaking, and selling the goods and services to customer are some of the major functions carried out by the middlemen. Retailers, wholesalers, agents, brokers, jobbers and carry forward agents are few of the intermediaries. Retailers are final link between the company and the customers. Their role in the marketing of product is increasing every day.
3 Publics
These are microenvironment groups, which help a company to generate the financial resources, creating the image, examining the companies’ policy and developing the attitude towards the product.
We can identify six types of publics
1. Financial publics influence the company’s ability to obtain funds. For example, Banks, investment houses and stockholders are the major financial publics.
2. Media publics carry news and features about the company e.g. Deccan Herald
3. Advertisement regulation agencies, telecom regulation agency( TRAI), and insurance regulation agency(IRDA) of the government
4. Citizen action groups: Formed by the consumer or environmental groups. For example, people for ethical treatment of animals (PETA) or Greenpeace.
5. General publics: a company should be concerned towards general publics’ attitude towards its products and services.
6. Internal publics: Employees who help in creating proper image for the company through word of mouth.
4 Competitors
A company should monitor its immediate competitors as its sale will be affected by the nature and intensity of the competitors. The sale of Coca cola will be affected by Pepsi cola, or Britannia cheese by Amul cheese. Michael Porter, the author of Competitive Advantage of Nations suggested that, in addition to direct competition, companies should also consider competition from substitutes. In addition to existing competitors, the potential competitors should also be anticipated. Competition may arise from
a. Small firms with low overheads producing duplicates.
b. Firms which diversify into certain products by merely being in the particular industry for e.g. Pepsi entered the snacks sector competing with pure snack producers like Haldiram.
c. Firms which expand in the same vertical for e.g. Godrej which manufactured office furniture and steel cupboards went on to the entire range of home furniture thereby giving competition to pure home furniture makers.
How do companies or enterprises survive and grow under the above circumstances. While we shall study this in detail later, a simple step could be that the product should be positioned differently and the company should be able to provide better services.
5 Suppliers
There are many kinds of suppliers to an enterprise or an institution. There are typically, raw material suppliers, energy and fuel suppliers, labour suppliers, office item suppliers and so on.
Suppliers are the first link in the entire supply chain of the company. Hence any problems or cost escalation in this stage will have direct effect on the company. Many companies adopted supplier relation management system to manage them well. Suppliers are a source of competition to firms today. For a large retail store like Reliance Retail or Big Bazaar the suppliers play the most significant role in both cost and time. Timely supplies reduce stocking of goods and blocking of space, at the same time meet customer requirements.
In a globalised scenario suppliers are even more important as competition goes up manifold! The Tamil Nadu State Electricity Board imports coal from New Zealand despite huge coal reserves in India. For Volvo, India is a manufacturing hub.
6 Customers
A company may sell their products directly to the customer or use marketing intermediaries to reach them. Direct or indirect marketing depends on what type of markets Company serves. Generally we can divide the markets into five different categories. They are
a. Consumer market.
b. Business market
c. Reseller market
d. Government market and
e. International market
You will come to know about these five different markets from the following example.
MRF, a tyre company sells its product directly to consumer (in case of urgency, customer purchases directly from showroom) i.e. operates in consumer market. It operates in business markets by selling tyres to companies like Maruti Udyog limited. MRF also sells TYREs to BMTC and KSRTC, transport organizations of Karnataka government. If MRF sells tyres in African or American countries then it is operating in the international market. If MRF buys the old tyres, retreads it and sells it to the consumer at a profit then company is operating in the reseller market.
b. Mention the different ad appeals with suitable examples. (4 marks)
The different ad appeals-
A)Emotional appeal:
Positive emotional appeal or negative emotional appeals are strong tools used to intensify the purchasing activity of the customer. Positive emotions like love, pride, joy and humor are used in the message. Following are the advertisement where such attributes of positive emotions used.
e.g. BMW fastest saloon car in the world- pride
e.g. Fevicol – humor
e.g. Wheel- love.
The negative emotions like fear guilt and shame are also used in the advertisement to attract the customer.
e.g. NIIT- if you are not studying at NIIT you are missing something- guilt
e.g. Rexona deodorant – shame
B)Rational appeals:
The rational appeals highlight on the desired benefits about the products. They highlight quality, economy value or performance of the product.
e.g. Dabur Amla – value appeal ( long Hair)
e.g. Lakme brilliance- Quality products.
e.g. Reliance India mobile- performance( works even in flood situations)
e.g. Reliance Infocom- Like the first three, the mobile phone must come to me as a necessity and not as a luxury- economy
C)Moral appeal:
These are concerned towards public health or environment or social responsibility.
e.g. Shell lubricants show its commitment towards environment in their advertisements.
Q.2 What are the different market entry strategies if a company wants to enter international markets?
Organizations that plan to go for international marketing should know the answers for some basic questions like – a. In how many countries would the company like to operate? b. What are the types of countries it plans to enter?That’s why companies evaluate each country against the market size, market growth, and cost of doing business, competitive advantage and risk level.
Checklist for country evaluation
The Characteristics, weightages and score should be checked.
1. Political rights.
2. Civil liberties.
3. Control of corruption.
4. Government effectiveness.
5. Rule of law or legal issues.
6. Health expenditure.
7. Education expenditure.
8. Regulatory quality.
9. Cost of starting a business.
10. Days to start a business.
11. Trade policy.
12. Inflation.
13. Fiscal policy.
14. Consumption patterns.
15. Competition.
International Market Entry Strategies
Once the market is found to be attractive, companies should decide how to enter this market. Companies can enter the international market by adoptingany one of the following strategies. They are
a. Exporting
b. Licensing
c. Contract manufacturing
d. Management contract
e. Joint ownership
f. Direct investment
Exporting is the technique of selling the goods produced in the domestic country in a foreign country with some modifications. For example, Gokaldas textiles export the cloth to different countries from India. Exporting may be indirect or direct. In case of indirect exporting, company works with independent international marketing intermediaries. This is cost effective and less risky too. Direct exporting is the technique in which organization exports the goods on its own by taking all the risks. Maruti Udyog Limited, India’s leading car manufacturer exports its cars on its own. Company can also set up overseas branches to sell their products. Adani Exports, another leading exporter from India has international office in Singapore.
Licensing: According to Philip Kotler, licensing is a method of entering a foreign market in which the company enters into an agreement with a license in the foreign market, offering the right to use a manufacturing process, trademark, patent, or other item of value for a fee or royalty. For example, Torrent Pharmaceuticals has license to sell the cardiovascular drugs of Chinese manufacturer Tasly. Licensing may cause some problems to the parent company. Licensee may violate the agreement and can use the technology of the parent company.
Contract manufacturing: Company enters the international market with a tie up between manufacturer to produce the product or the service. For example, Gigabyte Technology has contract manufacturing agreement with D- link India to produce and sell their mother boards. Another significant manufacturer is TVS Electronics; it produces key boards in its own name as well as for other companies too.
Management contracting: In this case, a company enters the international market by providing the know how of the product to the domestic manufacturer. The capital, marketing and other activities are carried out by the local manufacturer, hence it is less risky too.
Joint ownership: A form of joint venture in which an international company invests equally with a domestic manufacturer. Therefore it also has equal right in the controlling operations. For example, Barbara, a lingerie manufacturer has joint venture with Gokaldas Images in India.
Direct Investment: In this method of international market entry, Company invests in manufacturing or assembling. The company may enjoy the low cost advantages of that country. Many manufacturing firms invested directly in the Chinese market to get its low cost advantage. Some governments provide incentives and tax benefits to the company which manufactures the product in their country. There is government restriction in some countries to opt only for direct investment, as it produces the jobs to the local people. This mode also depends on the country attractiveness. It may become risky if the market matures or unstable government exists.
Q.3.a. State the meaning of Product life cycle and explain the different stages involved in it. (8 marks)
Meaning of Product Life Cycle: It means a product has to go through the various stages since its inception and till it completely fades out from the market. The following graph represents the PLC curve and the 5 stages that it has to undergo
The product which is introduced into the market will undergo some modifications over the period. Its sales also fluctuate. Therefore a marketer will be interested in finding out how sales changes over a period and what strategies are best suited at that point. A product life cycle can be graphed by plotting aggregate sales volume for a product category over time. Generally the curve resembles a bell shaped curve. We can obtain style, fashion or fad style of product life cycles also.
Product life cycle (bell shaped curve)
According to PLC, a product passes through five stages which are as follows:
1. Product development stage: In this stage company identifies the viable idea and develops it. Even if sales in this stage are nil it requires huge research and development budget. Therefore company incurs losses at this stage. For example, TATA Docomo before entering the cellular services market had done research and found that calls were charged for minutes rather than seconds.
2. Introduction stage: Company introduces the product into the market. As the product is new to the market, consumer awareness is usually very low. Here company adopts heavy sales promotion and product awareness programs. The cost of product is very high and sales are very low. At this juncture the company charges high price to the customers. For example, TATA Docomo has entered into cellular services initially through the Billboards.
3. Growth stage: Company gets experience over the period and now tries to get the maximum market share (takes ‘first mover’ advantage). Sales will grow rapidly, resulting in lesser cost and better profit. Company reduces the price of the product and offers varieties and values in it. It focuses on building better distribution network and pushes the product through it. Therefore company needs less sales promotion. There will be increase in Competition and the company is forced to keep a tab on its competitors. For example, TATA Docomo has entered into the growth stage by aggressively advertising on Television and other mediums and at the same time giving competition to the existing players.
4. Maturity stage: In this stage, the product has already established itself in the market. These are the characteristics of this stage – a. Peak sales.b. Low cost per customer. c. High profits.d. Competition based pricinge. Communicating the product differentiation (or USP) to consumers.f. Improving supply chain efficiency.g. Defend the market share h. Industry experiences consolidation.
5. Decline stage: In this stage, product sales and profit decline. Company should phase out weak items from their product mix and may even lower the prices of the existing products. The advertisement budget of the company also comes down and the company may struggle to meet its costs. For example, VCR’s have been replaced with DVD players and so VCR entered into the decline stage and is almost out of the market.
Other product life cycles:
1. Style: A style is a basic and distinctive mode of expression that appears in the study of human behavior. For example, style is evident in homes, art, accessories and clothing. Once the style is invented it will be there for a longer period.
2. Fashion: Currently accepted or popular style in a given field. For example, cargo jeans are now the fashion with college going students. Fashion changes with time.
3. Fad: A fashion that enters quickly is adopted with great zeal, peaks early, and declines very fast. For example, when pager was introduced, everybody wanted to have the product. But when people found mobiles as alternative, the demand for pager went down drastically.
b. Define Customer Relationship Management. (2 marks)
Berry defines CRM as “attracting, maintaining and – in multi-service organizations – enhancing customer relationships.”
Berry and Parasuraman define CRM as “attracting, developing and retaining customer relationships.”
In Industrial Marketing, Jackson defines CRM as “marketing oriented toward strong, lasting relationships with individual accounts.”
Doyle and Roth define CRMS as “the goal of relationship selling is to earn the position of preferred supplier by developing trust in key accounts over a period of time.”
The sequence of activities for performing relationship marketing would include developing core services to build customer relationship, customization of relationship, augmenting core services with extra benefits, and enhancing customer loyalty and fine-tuning internal marketing to promote external marketing success.
Christopher considers relationship marketing as “a tool to turn current and new customers into regularly purchasing clients and then progressively moving them through being strong supporters of the company and its products to finally being active and vocal advocates for the company.”
Relationship marketing is in essence “selling by using psychological rather than economic inducements to attract and retain customers. It seeks to personalize and appeal to the hearts, minds and purses of the mass consumers.”- James J. Lynch
From the above definitions, it could be concluded that Customer Relationship Management refers to all marketing activities directed towards establishing, developing, and sustaining long lasting, trusting, win-win, beneficial and successful relational exchanges between the focal firm and all its supporting key stakeholders.
Q.4.
a. You are a sales manager in ABC firm. You have taken some interviews and shortlisted a few candidates. How will you select the right candidate for the sales job? (5 marks)
1. Create an Ideal Salesperson Profile. It has always surprised me how many companies have fully documented profiles of their ideal client. Yet, few have a profile of their ideal salesperson. How can you screen when you don't know what you are screening for?
This profile should be fully detailed. Some of the areas to address in the profile are the experience you expect that candidate to already have, the skills that the candidate should already possess and the skills you are NOT willing to teach.
The lack of a fully-defined profile of the ideal salesperson is the most common cause of bad sales marriages. It is also the major point of frustration between sales managers and recruiters. Recruiters often tell me that they feel they are throwing darts while blindfolded because they have so little detail about the desired profile.
2. Always be recruiting. In sales, there is an old expression: "The toughest time to make a sale is when you really need one." The same holds true for recruiting. When a slot is open on the sales team, it becomes an "all hands on deck" exercise to fill it. While the seat is open, revenue targets are in jeopardy. This leads many to forget the profile of the ideal salesperson profile in the interest of filling a seat. Playing this forward a bit, the seat becomes vacant again a short time later when either side determines that it is not a good fit.
Sales recruiting is a year-round exercise. The best sales forces are always on the look out for strong sales talent. Find a company that identifies a strong candidate that meets their profile who wouldn't find a way to hire this individual. It is a rarity to say the least. Sales teams have turnover either driven by the company or the employee. It is best to have a candidate portfolio at the ready than to begin a process of surfacing candidates when a seat is open. Poor hiring decisions are made out of desperation to fill a seat. The open seat is a cost to the company every day it is unfilled. Yet, the cost is more painful if the seat is filled by someone who doesn’t fit.
3. Practice Reverse Interviewing. Since the intent of the process is for both sides to be able to determine if a marriage should be formulated, a wonderful technique is reverse interviewing—an interview performed by a member of the sales team who would be a peer if the candidate was hired. It is important that the individual(s) selected to participate in this step are loyal to the company, knowledgeable and make a favorable impression.
However, unlike traditional interviews, the "interviewer" does not ask any questions of the candidate (as you know, it is very easy to get yourself in hot water if illegal questions are asked). Thus, you don't want untrained people asking questions. Rather, this "questionless" exercise has two different purposes. The first is to provide the candidate with an opportunity to ask questions of someone who would be their peer if they were to be hired. In essence, it is a way for them to get a picture of a day in the life of this job. The second purpose is to measure how the candidate prepares for a sales call.
Afterwards, conduct a debrief with the "reverse interviewer" to see what questions were asked. Did the candidate take advantage of this opportunity, bring prepared and insightful questions and write down answers? If they didn't, what kind of preparation will the candidate do for a sales call? How interested are they really in this job?
5. Host a Mock Sales Call. What better way to see if someone fits into your company's selling environment than to put them right in it? To do this effectively, you need to create a scenario for the candidate. I've found it most beneficial to give the candidate the scenario a day ahead of time so they can prepare. They should be provided with the same amount of information a sales person in your company normally has before making an initial sales call.
Those members of your company who participate in the exercise should be somewhat scripted. I say "somewhat" because you don't want it to be so dry that it is unrealistic, but without any scripting it can be hard to stay in character.
The last piece you need to do this well is a score sheet. Know what you are looking to measure in the process and score accordingly. Can they conduct a thorough needs analysis? Did they identify the challenges faced by this prospect? Would you buy from them?
6. Use Online Assessment Testing Wisely. There are a myriad of tools that are very helpful in the screening process for both personality and skill. However, few, if any, of the online assessment companies suggest that their tool should be used to make a hiring decision. The most appropriate application is to treat it as an additional data point in the sales talent screening program.
Linda Moeller, product director of Employee Continuum, has seen companies use this great tool incorrectly. "We have seen many organizations fail to take the context of an organization into account when deciding the most appropriate assessment to use. For example, many organizations assume that implementing a sales assessment will guarantee them improved sales performers. This is not necessarily the case. For example, the personality characteristics required for a sales person selling office supplies to purchasing agents are very different than those required for a salesperson selling everything needed for a dentist office. In order to be successful, an organization needs to consider the type of relationship they have with their clientele and the competencies that will make these relationships successful," she says.
b. As a consumer, what are the steps you will undertake before you decide to buy a car? (5 marks)
The steps undertaken before deciding to buy a car-
1. Need recognition: customer posses two type of stimuli’ at this juncture. One is driven by the internal stimuli and another is external stimuli. The examples of internal stimuli are customer’s desire, attitude or perception and external stimuli are advertising etc. From both stimuli customers understand the need for the product. Here marketer should understand what customers needs have that drew customers towards the product and should highlight those in the communication strategy.
2. Information search: In this stage customer wants to find out the information about the product, place, price and point of purchase. Customer collects the information from different sources like
a. Personal sources: Family, friends and neighbors
b. Commercial sources: Advertising, sales people, dealers, packaging and displays.
c. Public sources: mass media and consumer rating agencies.
d. Experiential sources: Demonstration, examining the product.
In this stage marketer should give detailed information about the product. The communication should highlight the attributes and advantages of the product in this stage so that he created the positive image about the product.
3. Evaluation of alternatives: After collecting the information, consumers arrive at some conclusion about the product. In this stage he will compare different brands on set parameters which he or she thinks required in the product. The evaluation process varies from person to person. In general Indian consumer evaluate on the following parameters
a. Price
b. Features
c. Availability
d. Quality
e. Durability
At this stage marketer should provide comparative advertisements to evaluate the different brands. The advertisement should be different for different segments and highlight the attribute according to the segment.
4. Purchase decision
In this stage consumer buy the most preferred brand. In India affordability plays an important role at this stage. Organizations’ bring many varieties of the products to cater to the needs of customers.
5. Post purchase behavior
After purchasing the product the consumer will experience some level of satisfaction and dissatisfaction. The consumer will also engage in post purchase actions and product uses of interest to the marketer. The marketer’s job does not end when the product is bought but continues into the post purchase period. Customer would like to see the performance of the product as he perceived before purchase. If the performance of the product is not as he expected then he develops dissatisfactions. Marketer should keep an eye on how consumer uses and disposes the product. In some durable goods Indian consumer want resale value also. Many automobile brands that were not able to get resale value lost their market positions.
Q. 5
a. What are the features of Business markets? How is it different from consumer markets? (5 marks)
Features or Characteristics of Business Markets
Following are some of the unique features of business markets where large establishments purchase the required goods and services from other businesses. Such B2B operations determine the organizations as buyers and those organizations who supply the various requirements will be the sellers or suppliers or service providers.
1. Few but bulk Buyers: The no. of buyers is few but they buy in large quantity. For example, major airlines buy the necessary equipments from the aircraft manufacturers
2. Geographical concentration of buyers: Buyers are geographically concentrated. For example, shipping industries are located on the east and west coasts of India than in any other places.
3. Variable demand: The nature of demand is fluctuating because the demand is basically a derived one. Based on the requirements of the consumer markets, organizations buy the goods and make the finished goods available in the market for final consumption. Larger the consumer demand, larger will be the organizational buying. For example, mobiles are being used by a large population and so cellular companies have to meet this rising demand.
4. Inelastic demand: The demand is also inelastic because organizations cannot make rapid changes in the production structure and so prices remain constant in the short-term. For example, Shoe manufacturers will not buy much leather if the price of leather is less neither will they buy less leather if the price increases.
5. Systematic purchasing: The purchasing activity is directly between the buyer and supplier organization which means there are no or very few middlemen involved. Purchasing activity is usually undertaken by purchase departments based on a proper structure and through various mechanisms like having purchase requisitions from other sections, inviting tenders and sending invoices from the suppliers, purchasing agreements or contracts with the key suppliers, renewing agreements etc. For example, Reliance Fresh has regular contracts with the agricultural producers for smooth supply of fresh fruits and vegetables.
6. Multiple buying influences: there will be several parties involved in deciding about the purchases because organizations will have several departments and units functioning under it with different requirements. So, unless they have the proper resources to work with there will be problems in the departments. For example, purchase department in a Hospital must be aware about the specific requirements in the clinical wards, operation theaters, labs, etc.
7. Reciprocation: This means that when an organization buys goods from another organization then the supplier organization also might need certain other goods that are produced by the buyer organization. For example, a stationery supplier will supply the necessary stationeries to the paper manufacturer who in turn provides papers to the supplier.
8. Lease agreements: Most organizations take on lease the expensive equipments required by them rather than buy it. So, in this way, they reduce cost, get better service and the lessor or one who provides the equipments will also profit from the rent or lease charges. For example, TATA provides the transport trucks to other organizations on lease.
b. List out the 5 important requisites of an effective segmentation by giving suitable examples. (5 marks)
Requisites of Effective Segmentation
1. Measurable and Obtainable: The size, profile and other relevant characteristics of the segment must be measurable and obtainable in terms of data. If the information is not obtainable, no segmentation can be carried out. For example, Census of India provides the data on migration and education level, but does not specify how many of the migrated employees are educated and if educated how many are in white collared jobs. If a company wants to target white color collared employees who are migrated to particular city, it will not able to measure the same. .
2. Substantial: The segment should be large enough to be profitable. For consumer markets, the small segment might disproportionably increase the cost and hence products are priced too high. For example, when the cellular services started in India cost of the incoming calls and outgoing calls were charged at Rs 12/minute. As the number of subscribers grew, incoming calls became free. Further growth of subscribers resulted in lowering tariffs for outgoing calls to the lowest level in the world.
3. Accessible: The segment should be accessible through existing network of people at an affordable cost. For example, Majority of the rural population is still not able to access the internet due to the high cost and non-availability of connections and bandwidth.
4. Differentiable: The segments should be different from each other and may require different 4Ps and programs. For example, Life Insurance Corporation of India needs separate marketing programs to sell their insurance plans, unit plans, pension plans and group schemes
5. Actionable: The segments which a company wishes to pursue must be actionable in the sense that there should be sufficient finance, personnel, and capability to take them all.
Q. 6. Explain briefly what are the several processes involved in new product development. (10 marks)
New Product Development
New products are essential for existing firms to keep the momentum and for new firms they provide the differentiation. New product doesn’t mean that it is absolutely new to the world. It may be a modification, or offered in a new market, or differentiated from existing products. Therefore it is necessary to understand the concept of new products.
Meaning of New Products:
a. They are really innovative. For example, Google’s Orkut, a networking site which revolutionized social networking. In this site people can meet like minded people; they can form their own groups, share photos, comments and many more.
b. They are very different from the others: Haier launches path-breaking 4-Door Refrigerators first time in India
c. They are imitative; these products are not new to the market but new to the company. For example, Cavin Kare launched Ruchi pickles. This product is new to Cavin Kare but not to the market.
New product development process:
Stage 1 – Idea generation: New product idea can be generated either from the internal sources or external sources. The internal sources include employees of the organization and data collected from the market. The external source includes customers, competitors and supply chain members. For example, Ingersoll Rand welcomes new ideas from the General public
Stage 2-Idea screening: Organization may have various ideas but it should find out which of these ideas can be translated into concepts. In an interview to Times of India, Mr. Ratan Tata, chairman TATA group discussed how his idea saw many changes from the basic version. He told that he wanted to develop car with scooter engine, plastic doors etc… But when he unveiled the car, there were many changes in the product. This shows that initial idea will be changed on the basis of market requirements.
Stage 3 – Concept development: the main feature or the specific desire that it caters to or the basic appeal of the product is created or designed in the concept development.
Concepts used for Tata Nano car are:
Concept I: Low-end ‘rural car,’ probably without doors or windows and with plastic curtains that rolled down, a four-wheel version of the auto-rickshaw
Concept II: A car made by engineering plastics and new materials, and using new technology like aerospace adhesives instead of welding.
Concept III: Indigenous, in-house car which meets all the environment standards
Stage 4 – Concept testing: At this stage concept is tested with the group of target customers. If any changes are required in the concept or the message it will be done during this stage. Also the effectiveness is tested on a minor scale. If the concept meets the specific requirements, then it will be accepted.
Stage 5 Marketing strategy development: The marketing strategy development involves three parts. The first part focuses on target market, sales, market share and profit goals. TATA’s initial business plan consisted sales of 2 lakhs cars per annum. The second part involves product price, distribution and marketing budget strategies. TATA’s fixed Rs 1 lakhs as the car price, and finding self employed persons who work like agent to distribute the cars. The final part contains marketing mix strategy and profit goals.
Stage 6 – Business analysis: it is the analysis of sales, costs and profits estimated for a new product and to find out whether these align with the company mission and objectives.
Stage 7 – Product development: during this stage, product is made to undergo further improvements, new features or improvised versions are added to the product. There is also scope for innovation and using the latest technology into the product.
Stage 8 – Test marketing: is the most crucial stage for the testing product’s performance and its future in the market. There are certain cases where product has failed in the test marketing and had to be withdrawn.
– The product is introduced into the realistic market
– The 4P’s of marketing are tested.
– The cost of test marketing varies with the type of product.
Stage 9 – Commercialization: In this stage product is completely placed in the open market and aggressive communication program accompanied with promotion activities is carried out to support it.
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