Assignment

(MB0046- Marketing Management)

Q1. Define Service Marketing and Explanation of 4Ps and 3Ps
Service Marketing: Service marketing is marketing based on relationship and value.
It may be used to market a service or a product. With the increasing prominence of
services in the global economy, service marketing has become a subject that needs to
be studied separately. Marketing services is different from marketing goods because of
the unique characteristics of services namely, intangibility, heterogeneity, perishability
and inseparability.

4Ps in Marketing
A marketing mix can be referred to as a planned mix of the controllable elements of a
products marketing plan, commonly termed as 4Ps: Product, Price, Place and
Promotion. These four elements are adjusted until the right combination that serves the
needs of the customers, while generating optimum income for the company is found.
Product: In marketing mix, the product or service is the most important element.
Customers acquire products for a singular reason that they are perceived as the
means to satisfy their needs and wants. According to Philip Kotler, A product is
anything that can be offered to a market for attention, acquisition, use, or
consumption that might satisfy a need or want. In effect, according to this
definition, products include physical products, services, persons, places,
organizations, and ideas. Products have various attributes such as quality,
variety, design, brand, packaging, services, and warranties that can be
manipulated depending on what the target market wants.
Price: The second element is the price, which impacts the volume of sales. It is
a value that will purchase a specific quantity, weight, or other measure of a
product. Price is the only marketing mix variable that can be altered quickly. Price
directly influences the development of marketing strategy as it is a major factor
that influences the assessment of value obtained by customers. Firms have to
consider some factors while deciding the price of a product. These factors are:
Objectives of business
The competitive environment
Product and promotional policies of the firm
Nature of price sensitivity
Conflicting interest between manufacturer and intermediaries
Routine pricing decisions
Active entry of non-business groups in pricing decisions

 Place: This is another key marketing mix tool, which encompasses the various
activities the company attempts to make the product available to the target
customers. Place mix deals with the physical distribution of products at the right
time and right place. Distribution channels may also be used in marketing
strategy to differentiate a product from its competitors. A company uses
distribution channels like retailers, wholesalers, merchants, brokers and value
added resellers. The management also aims to keep the physical distribution
costs (inventory, transportation, and storage) as low as possible.
Promotion: This includes the methods to communicate the features and
benefits of the products or services to its target customers. Some common
methods include advertising, sales promotion, direct selling, public relations, and
direct marketing. Promotion is a key element of marketing programme that is
used to favorably influence target customers perceptions to facilitate exchange
between the marketer and the customer

Additional 3Ps: The traditional 4Ps were not enough to market services. Considering
the increasing role of services in the economy and customer-orientation, additional 3Ps
were added to the marketing mix. These 3Ps are people, process, and physical
evidence. They play a greater role in the marketing of services than in the marketing of
products.

People: This is a very important element of the modern marketing mix or the
service mix. An essential ingredient to any service provision is the use of
appropriate staff and people. Recruiting the right staff and training them
appropriately to delivery their services are very essential if the organization wants
to obtain a competitive advantage. Consumers make judgments and deliver
perceptions of the service based on the behavior and performance of employees
they interact with. Therefore, the service staff should have the appropriate
interpersonal skills, aptitude, and service knowledge to provide the service that
the consumers are paying for.

Process: This refers to the way in which a service is delivered to the end
customer. For example, when you go to McDonalds drive-through, you are first
greeted by an attendant who asks you for your order. Then, he/she notes down
your order and informs a crew member about it. By the time you pay the billed
amount, your order arrives. You take your order and leave. This represents a
service delivery process

Physical Evidence: Physical evidence is the tangible part of a service. Service

customers experience a greater perceived risk as they cannot rate a particular
service until it is consumed. Therefore, service providers should try to attach an
element of tangibility to their service offering. Physical evidence can include web
pages, paperwork (such as invoices, tickets, and dispatch notes), brochures,
furnishings, ambience, signage (such as those on aircraft and retail stores),
brand logos, uniform of employees, business cards, and the building itself

Q2. Definition of Sales Promotion and eight tools of sales promotion

Sales Promotion: Sales promotion refers to the provision of incentives to the end
consumer (pull strategy) or to intermediaries (push strategy) to stimulate demand for a
product. It is normally used in combination with either advertising or personal selling.
Consumer sales promotions include price promotions (also known as price
discounting), coupons, gift with purchase, samples, contests, sweepstakes, money
refunds (or rebates), frequent shoppers or loyalty incentives and Point of Purchase
(PoP) displays. Trade-oriented sales promotions are geared to supporting a firms
advertising and personal selling efforts. Typical trade promotional tools include
allowances and discounts, cooperative advertising and training of distributors sales
force.
The main advantage of sales promotions is their effectiveness at stimulating sales
during the duration of the offer. The disadvantages are that sales go down as soon as
the deal ends and that effectiveness tends to dissipate over time if used continuously.

Tools of Sales Promotion: To increase the sale of any product manufactures or

producers adopt different measures like sample, gift, bonus, and many more. These are
known as tools or techniques or methods of sales promotion.
i.

Free samples: You might have received free samples of shampoo, washing
powder, coffee powder, etc. while purchasing various items from the market.
Sometimes these free samples are also distributed by the shopkeeper even
without purchasing any item from his shop. These are distributed to attract
consumers to try out a new product and thereby create new customers. Some
businessmen distribute samples among selected persons in order to popularize
the product. For example, in the case of medicine free samples are distributed
among physicians, in the case of textbooks, specimen copies are distributed
among teachers.

ii.

Premium or Bonus offer: A milk shaker along with Nescafe, mug with
Bournvita, toothbrush with 500 grams of toothpaste, 30% extra in a pack of
one kg are the examples of premium or bonus given free with the purchase
of a product. They are effective in inducing consumers to buy a particular
product. This is also useful for encouraging and rewarding existing
customers.

iii.

Exchange schemes: It refers to offering exchange of old product for a

new product at a price less than the original price of the product. This is
useful for drawing attention to product improvement. Bring your old mixercum-juicer and exchange it for a new one just by paying Rs.500 or
exchange your black and white television with a color television are
various popular examples of exchange scheme.

iv.

Price-off offer: Under this offer, products are sold at a price lower than the
original price. Rs. 2 off on purchase of a lifebuoy soap, Rs. 15 off on a pack of
250 grams of Taj Mahal tea, Rs. 1000 off on cooler etc. are some of the common
schemes. This type of scheme is designed to boost up sales in off-season and
sometimes while introducing a new product in the market.

v.

Coupons: Sometimes, coupons are issued by manufacturers either in the

packet of a product or through an advertisement printed in the newspaper or
magazine or through mail. These coupons can be presented to the retailer while
buying the product. The holder of the coupon gets the product at a discount. For
example, you might have come across coupons like, show this and get Rs 15 off
on purchase of 5 kg. of Annapurna Atta. The reduced price under this scheme
attracts the attention of the prospective customers towards new or improved
products.

vi.

Money Back offer: Under this scheme customers are given assurance that full
value of the product will be returned to them if they are not satisfied after using
the product. This creates confidence among the customers with regard to the
quality of the product. This technique is particularly useful while introducing new
products in the market.

vii.

Trading stamps: In case of some specific products trading stamps are

distributed among the customers according to the value of their purchase. The
customers are required to collect these stamps of sufficient value within a
particular period in order to avail of some benefits. This tool induces customers to
buy that product more frequently to collect the stamps of required value.

viii.

Scratch and win offer: To induce the customer to buy a particular product
scratch and win scheme is also offered. Under this scheme a customer scratch
a specific marked area on the package of the product and gets the benefit
according to the message written there. In this way customers may get some
item free as mentioned on the marked area or may avail of price-off, or
sometimes visit different places on special tour arranged by the manufacturers.

Q3. Definition of Environmental Scanning using Delphi Technique and

Scenario Building
Environmental Scanning: Environmental scanning refers to the careful monitoring of
an organisation's internal and external environment for detecting early signs of
opportunities and threats that may influence its present and future marketing plans. It
helps the marketer in taking decisions regarding where to compete, how to compete,
and on what to compete. The opportunity in business can be a trend or event that could
lead to a significant upward change in sales and profit patterns, given the appropriate
strategic response. In the absence of a strategic response, a threat will result in a
significant downward departure from current sales and profits. If the strategic
uncertainty is important and urgent, marketing managers may conduct an in-depth
analysis to take an urgent decision. Environmental scanning helps marketing managers

to find out the important forces outside an organisation, which will shape its business in
relation to competitors. Some organisations have a formal marketing intelligence unit,
which collects data on external environment and feeds it into the decision-making unit of
the firm. It helps the decision makers to stretch their decision ideas by incorporating
new information into business planning. Whether the information required is just to
make the marketing managers aware about marketing trends or to be incorporated in
the marketing planning and budgeting will decide the immediacy and accuracy level of
the data collected from the market. Companies use various methods for environmental
scanning two important techniques, namely Delphi technique and Scenario building
technique,

Delphi Technique: Delphi technique is used to increase the meaning of factual data
collected from secondary sources. This technique is an example of methods on which
we aggregate the judgments of individual experts who cannot come together physically.
This is a qualitative research technique in which we try to collect data from some
experts and industry observers and use their interpretations to map the emerging trends
in that industry. Around twenty-five experts who have adequate knowledge of the
marketing environment are asked questions pertaining to the marketing environment via
mail, fax, email, and other modes of communication. They are asked to rank their
statements as per importance and to explain the rationale behind such rankings. The
aggregate information is sent to all the participants to get their overall agreement and
disagreement on the aggregate data and through this process a coherent agreement is
arrived at.

Scenario Building Technique: This process is futuristic and the decision-maker has
to analyse his decisions with respect to the future. The five stages of scenario building
approach are as shown in figure

1. Analysis of the decision(s): The decision-maker makes a detailed analysis of all

the resources that he/she might require to implement his/her decisions. Thus, if a
financial institution like ICICI decides to go into retail banking, then it has to take into
account the human and material resources that would be required. It could include an
analysis of the estimated distribution networks, technology and technology support.

2. Identification of key decision factors: The service marketer identifies all those
variables that influenced his/her decision. For ICICI to go into retail banking, it would
analyze the new banking norms (government policy), market share of the existing
players (competitors), growth and potential of the market (customers), etc.

3. Identifying the socio-cultural factors: The service marketer should identify and
evaluate the influence of such social and group forces as demographic changes, social
class, culture, family and household influences, value systems, reference group
influences, and the consumer-decision-making process. ICICI would have taken into
consideration the age distribution of the market, the income and occupation of
prospects, the spread of the population in metros and other towns, product
development, and communication strategy. It would also have analysed the banking
needs of the market and their inclination towards timesaving devices .

4. Analysis of each of the key variables separately: All the above variables are
independently analysed and all other details are collected for each of them. The sources
of data are secondary as well as primary.
5. Selection of scenario logics: The collected data are then extrapolated and
projections are made. The scenario build-up is supported with more evidence. Thus for
ICICI, the growing middle-class and the aspirations of the middle class for a better
banking climate would be relevant to the decision to go in for retail banking. Other
evidence could be the consumerism of the middle-class, their upscale lifestyles, etc.

Q4. Definition of Personal Selling and steps involved in the Personal

Selling Process
Personal Selling: Personal selling is an activity which involves a face-to-face interaction

with the customers wherein there is a quick response and personal confrontation. This
allows for more specific adjustment of the message. Here, the communication message
can be adjusted as per the customers specific needs or wants. It offers you the
opportunity to develop long-term familiarity and relationship. In personal selling, the
focus in on personal or one to one selling. It is the art of successfully persuading
prospects or customers to buy products or services from which they can derive suitable
benefits thereby increasing their total satisfaction, i.e., delight. So, in this sense, we can
say that the salesperson is not only selling products and services but he/she is selling a
value proposition to the customer. It is the responsibility of the salesperson to create
enduring relationship with the customer that benefits both in the long-term.
Step 1 Prospecting: This is the first step in the personal selling process and involves
potential clients who might require the product and who also have the means to
purchase the product offered being shortlisted. The process, in a large number of
industries, involves cold calling, i.e., the practice of physically or telephonically calling a
potential customer and ascertaining if a need exists for the product.
Step 2 Pre-Approach: Pre-approach is, in fact, a preparatory step for the meeting with
the prospect. Information such as preferences and expectations of the prospect is
gathered and the presentation is crafted accordingly. Ideally, if the needs, tastes,
requirements, outlook of the prospect can be ascertained, then a thorough preparation
could be organized by estimating possible questions the prospect may ask and
appropriate answers for the same.
Step 3 Gain Interview/Approach: Gain Interview/Approach is the phase where the first
contact with the prospect is made in accordance with the appointment fixed in the pre-

approach stage. The objective of this stage is to obtain the prospect's attention and gain
his interest for the product/ service under offer.
Step 4 Presentation: The core of the selling process, this stage is all about generating a
desire for the product in the prospect's mind. Once again, various approaches are
prevalent. The activity could start by exhibiting the product or helping the prospect
visualize the product through pictures, charts, etc.
Step 5 Handling Objections: The objection handling phase that follows the presentation
phase is amongst the most critical phases in personal selling. In this phase, the
customer's doubts on the benefits that the product might provide him need to be cleared
in a reassuring and complete manner. The sales person can clarify the customers
objection by a thorough demonstration of the product.
Step 6 Closing the Sale: The importance of this step cannot be overstated as this is
where the real results of the entire sales effort can be visible. In this stage, after all the
negotiations and discussions, the salesperson finally asks for the order. There are
different ways in which the sales person is able to clinch the deal.
Step 7 Post-Sales Service: Post-sales service is the final step in personal selling and
has been utilized by many experienced salesmen as a key for obtaining new prospects,
repeat sales, etc. This step is vital from the point of view of helping the customer
overcome 'post purchase dissonance'. It has been established that negative feelings
and thoughts may sometimes arise in a client's mind after the purchase.

Q5. Definition of Buying center, seven roles of buying center and role
of functional departments in the purchase process
Buying Center: A major task of an industrial marketer is to identify those individuals
who are in any way involved in purchasing decision process. These decision-making
units are called buying centers. Buying centers can be an individual, a department, or a
group of individuals from different departments in the organizations. Buying center has
common goals to achieve, which also includes sharing the risks arising from the
purchase decision. Its not unusual to encounter groups consisting of 15 to 20
individuals as members of buying centers. These are informal, cross department
decision-making units in which the primary objective is the acquisition, import, and
processing of relevant information. Buying centers play seven roles.

1. Initiators These are the people who request for something to be purchased. They
may be users or others in the organization.

2. Users They use the products and thus initiate the purchase process. They report
on the products performance. E.g., worker.

3. Influencers Individuals in the organization influence the decision-making process

by providing information on the criteria for buying. E.g. research and development
specialist inside the organization and consultants outside the organization .

4. Deciders Organizational members with decision-making power who decide about

the purchase. E.g., engineers deciding specifications or vice-president (finance) who
decides in favour of the purchase.

5. Gatekeepers People in the organization who have the power to prevent sellers or
information from reaching the members of buying centers. E.g., purchasing agents,
receptionist, secretaries, and telephone operators.

6. Approvers People in the organisation who authorise the proposed actions of

deciders or buyers.

7. Buyers People who have formal authority to select the suppliers and arrange the
purchase terms. Buyers help in product specifications, selection of suppliers, and
negotiating purchases and include senior people in the purchase department.

Role of various functional departments in the purchase process

Different departments within the organisation play various roles as mentioned in the
above discussion. We are briefly presenting a few roles played by these departments.

Marketing Purchasing decision has an effect on the marketability of a firms

product, such as altering the products, materials, packaging orprice. Marketing
people become active influencers in purchase decision process. Since they are
closest to the business markets, they can collect information as well as initiate
purchase process with higher precision level.

Production and operations These departments are responsible for

determining the feasibility and economic considerations of producing endproducts. Engineering decision on specification of parts and materials are
confirmed in this department. These departments provide continuous feedback
on changes in equipment costs and their impact on current production schedules
to the purchase department.

Research and development This department takes care of initial

development of products and processes and sets specifications for components
and material requirements for use in the end-product design. Marketers also get
involved in the process of research and development and final design of the
product. Marketers are also involved in deciding what components should be
incorporated as per customer requirements. They provide information on inputs,
which will give direction to customer orders.

Purchase department Contrary to the belief that purchasing department

does not play a central role in organisational decision, it is one of the key centres
for business customers. They are negotiation experts, who dominate in straight
re-buy, and have high influence on negotiations done under uncertain
environmental conditions.

Q6. Describe some of the strategies for effective marketing and

advertising in rural market. Also the innovative use of media in rural
market.
Nature of the rural market:
The rural areas are where the markets of the future lie. Urban markets are becoming
increasingly competitive and saturated for many products. On the other hand, rural
markets offer growth opportunities for firms caught up in intensive battle in urban and
metro markets. Marketing gurus describe rural markets as the market of the new
millennium. According to them, marketers have to understand the rural customers
before they can make inroads into rural markers. A sound understanding of rural
consumer behaviour and customer demand patterns will help the rural marketer to
creatively serve the rural market with ample success.

Strategies:

An efficient countrywide distribution network must be created so that company's

products are available to the farmers at their doorstep.
Advertising communication and servicing must be evolved in tune with rural
needs and in ways different from what is effective in larger towns and cities.
There should be a strong research and development team to produce products
specifically for rural areas.
Role of trade in distribution and communication must be strengthened.
Pricing of products should be in line with the economic competence of villagers.
Packaging should be simpler and more functional than ornamental.

Innovative use of media:

In rural marketing, institutional promotion is more important than brand advertising. To a
marketer, this is another hurdle because he/she may promote the institution and some
other brand may be bought. Inability of the smaller retailers to carry stocks without
adequate credit facilities is an impediment for growth of retail in rural areas. Rural
markets have also inadequate warehousing, which leads to delay in replenishments of
stocks. Marketers must overcome all these barriers to successfully market their product
in the rural market.