Marketing Management - 2 Marks

Cheatsheet Content

### **What is marketing?** - **Marketing is the business of moving goods/services from the producer to the consumer.** ### **Define Marketing.** - **According to the British Chartered Institute of Marketing, Marketing is the management process responsible for identifying, anticipating and satisfying consumers' requirements profitably.** ### **What is Market?** - **The area of economic activity in which buyers and sellers come together and the forces of supply and demand affect prices.** ### **What is Marketing Management?** - **Marketing management is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value.** ### **Difference between selling and marketing** - **The difference between selling and marketing is more than a semantic exercise. Selling means moving products while marketing means obtaining customer.** ### **Define Consumer Behaviour?** - **In the words of Walters and Paul, "Consumer behaviour is the process whereby individuals decide what, when, where, how and from whom to purchase goods and services".** ### **Define Market Segmentation?** - **According to Alan A., Robert, "Market segmentation is the strategy of dividing markets in order to conquer them".** ### **What is Segment marketing?** - **In segment marketing, market is divided into two or more segments. A market segment consists of buyers having similar needs, buying habits, purchasing power and lifestyle. The marketer selects one or more segments to target. For each segment, a separate marketing mix is designed.** ### **What is Niche marketing?** - **A niche is a segment (sub-segment) within a segment. This segment is a very small section of the whole market which has not yet been identified and served by competitors. Thus niche marketing means serving a small market not served by competitors. It is a strategy of devising and selling products specifically for a small unexploited part of a market.** ### **What is Local marketing?** - **Here the marketing programme is tailored to the needs and wants of local customer groups (trading areas, neighbourhoods, even individual stores).** ### **What is Individual marketing (customized marketing)?** - **This is the ultimate level of segmentation. Today customers are taking more individual initiative in determining what and how to buy. They design their own products and services. In individual or customized marketing, companies customize their products, services and messages on a one-to-one basis.** ### **What is Undifferentiated marketing?** - **Here has only one marketing strategy for several market segments and has only one type of product to be produced and marketed. In short, under undifferentiated marketing, one marketing mix is used for the entire market.** ### **What is Differentiated marketing?** - **In the case of differentiated marketing, a number of market segments are identified and a different marketing mix (or strategy) is developed for each of the segments. This is probably the most popular segmentation approach, particularly for consumer products.** ### **What is Concentrated marketing?** - **Concentrated marketing is concerned with the concentration of all marketing efforts (or resources) on one selected segment within the total market. The producer or marketer selects a market where there is a little or no competition and it can do the best in that segment. This is especially followed when the resources are limited.** ### **What is Geographic Segmentation?** - **This is the simplest form of segmenting the market. Here, the marketer divides the market into different geographical areas.** ### **Meaning of Target Market.** - **A target market is a group of customers at whom the entire marketing efforts are directed. It is a specific group of buyers on whose needs and wants a company focuses its marketing efforts.** ### **What is Post purchase behaviour?** - **Post purchase behaviour refers to the behaviour of a consumer after purchasing a product. After the consumer has actually purchased the product/brand he will be satisfied or dissatisfied with it. This satisfaction or dissatisfaction will result in certain consequences.** ### **What is Social class?** - **On the basis of social class, customers may be grouped into lower class, middle class and upper class. Social class is determined by income, occupation and education. Many companies design products and services for specific social classes.** ### **What is Convenience goods?** - **Convenience goods are the goods which the consumers usually purchase frequently or immediately and with little effort from convenient location. These products are easily available, low priced, heavily advertised and bought regularly by customers. Examples include magazines, cigarettes, salts, biscuits.** ### **What is Unsought goods?** - **These are goods the consumer does not know about or does not normally think of buying. For example, insurance policies.** ### **What is Staple goods?** - **These are purchased on regular basis. These are the basic demands of human beings. Tooth paste and soaps, detergents, milk, sugar etc. fall under this category.** ### **What is Industrial Goods?** - **These goods are meant for use in the production of other goods or for some business or institutional purposes. These goods are not directly used by consumers. Industrial goods are classified into four - production facilities and equipments, production materials, production supplies and management materials.** ### **What is Branding?** - **It simply means naming a product for its identification and distinction.** ### **What is a Trade Mark?** - **Trade mark is a legal term. When a brand name or a brand mark is registered and legalised it becomes a trade mark.** ### **What is Brand equity?** - **It is the 'added value' with which a given brand endows a product.** ### **Meaning and Definition of Product and Service Differentiation?** - **Product differentiation simply refers to the process of making a product or service different in some respects from the competitive products or services.** ### **What is PLC?** - **It refers to the stages through which a new product moves as it enters, gets established, and ultimately leaves the market place.** ### **What is packaging?** - **Packaging refers to activities of wrapping or enclosing the product in a container like bottle, tin, jar, bag, etc. to facilitate transportation, storage, sale or consumption.** ### **What is labelling?** - **Label is that part of product that carries information about the product and the seller, name of product, qualities of product, quantity of product, ingredients, date of production, expiry date, instruction for use and storage.** ### **What is grade label?** - **This gives the grade or quality of the product by number, letter or word.** ### **What is information label?** - **It provides maximum possible information about a product. It contains fuller instructions on the use and care of the product.** ### **What is warranty?** - **A warranty is a promise by a manufacturer that a certain product is free from defects and that it will perform optimally as required. It is the term of a contract, breach of which gives rise to claim for damages but not the repudiation of the whole contract.** ### **What is guarantee?** - **A guarantee is an assurance by the manufacturers that certain products are of high quality; It is the commitment given by the seller concerning the product quality. Guarantee is a promise made by the producer, to the purchaser, that if the item is of low quality, it will be replaced, repaired or the cash kept will be refunded.** ### **What is Patronage Motive?** - **Patronage motives are those motives which determine where or from whom products are purchased.** ### **What is price?** - **Price is the amount paid by the buyer to the seller for a product. It is the exchange value of a product or service in terms of money.** ### **What are the internal factors influencing the pricing decisions?** - **Costs, objectives, organisational factors, marketing mix, product differentiation, product life cycle.** ### **What is cost based pricing policy?** - **The policy of setting price on the basis of total cost per unit is known as cost oriented pricing policy.** ### **What is cost plus pricing?** - **Under this method the price is computed by adding a certain percentage of profit to the cost of product per unit.** ### **What is Break even pricing?** - **Under this method, the firm determines the price at which it will break even. The firm first determines the break-even point. It is the point at which total sales are equal to total cost.** ### **What is demand based pricing policy?** - **In this method, price is fixed by adjusting market condition. Price is fixed according to the demand for the product. When demand is high, prices are also high, but when demand is low, prices are also low.** ### **What is differential pricing? (discriminatory pricing)** - **Under this method, the same product is sold at different prices to different customers, in different places and different periods.** ### **What is Premium pricing? (high pricing)** - **It is based on the principle that the product or brand should be positioned at the top of the market and must offer greater value in qualitative terms than similar brands in other price segments.** ### **What is competition based pricing policy?** - **This is the policy of fixing the prices mainly on the basis of prices fixed by competitors. The firm may keep its price higher or lower than that of competitors.** ### **What is Going rate pricing?** - **It is the method of charging prices according to what competitors are charging. Under this method, the firm accepts the price prevailing in the industry to avoid a price war. It is also called acceptance pricing, or market equated pricing or parity pricing.** ### **What is price strategy?** - **A pricing strategy is a special kind of plan formulated in order to meet the challenges of external factors particularly from the policies of competitors.** ### **What is psychological pricing?** - **Some producers fix the prices of their product in a manner that it may create an impression in the minds of consumers that the prices are low.** ### **What is administered pricing?** - **Pricing is done on the basis of managerial decisions and not on the basis of cost, demand, competition etc. It is called administered pricing.** ### **What is Dual pricing?** - **Dual pricing is when a producer sells the same product at two different prices at the same place.** ### **What is product line pricing?** - **It refers to the determination of prices of individual products and finding the proper relationship among the prices of members of a product group.** ### **What is mark up pricing?** - **This method of pricing is followed by wholesalers and retailers. When the goods are received, the retailer adds a certain percentage of the wholesaler's price.** ### **What is captive product pricing?** - **The producers fix a low price for their main product and high prices for the captive products. Eg: Camera film, razor blades, computer floppy etc.** ### **What is Basepoint pricing?** - **Under this method, the seller designates a city as a base point and charges all customers the freight cost from that base point to the place of the customer.** ### **Meaning of Promotion** - **Promotion is one of the four elements in the marketing mix. Many people strongly believe that marketing begins as well as ends with promotion. The main object of promotion is to move forward a product, service or idea in a channel of distribution.** ### **Advertising:** - **Advertising is concerned with the dissemination of information concerning an idea, service or product to compel action in accordance with the intent of the advertiser. It is described as impersonal salesmanship or printed salesmanship.** ### **Public relations:** - **This is the extended form of the older tool publicity. It includes all the non-sales communication the business has with their various audiences. It consists of both communication with the general public and press relations. Its main task is image building.** ### **Sales promotion** - **Sales promotion includes those activities other than advertising and personal selling that stimulate market demand for products. These activities are designed to stimulate interest in the product.** ### **Direct marketing:** - **In direct marketing, companies communicate directly with target customers to generate a response and/or a transaction. Traditionally direct marketing has not been considered as an element of the promotion mix.** ### **Internet and Interactive marketing:** - **Electronic media are used today to promote products or ideas. For example, e-mail marketing or advertisement on the Internet.** ### **Personal selling:** - **It refers to oral and face-to-face communication and presentation with the customer for the purpose of making sales. There may be one customer or a group of customers in the personal conversation.** ### **Meaning Advertisement** - **Advertisement is the most glamorous element of the marketing communication mix. It is the poetry of marketing. It covers all activities connected with the giving of publicity regarding goods and services offered for sale.** ### **Point of Purchase Display (POP Advertising)** - **Outdoor advertisement reaches him when he leaves his home. Point of purchase advertising greets him when he approaches the place where the goods are sold. Thus point of purchase advertising is concerned with the advertisements at or near about the place where goods are sold. It includes all forms of advertising which the customer sees at the place of purchase. This is called display advertising or promotional advertising.** ### **Window display:** - **This medium of advertisement is done by dealers. This refers to showing of goods in the front glass window of the shop. The products are displayed most attractively and scientifically. The price is also attached to the articles. Through window display, the seller informs the customers the types of goods, design and colour available with him. It influences not only the customers who visit the shop but also the people who pass in front of the shop.** ### **Counter display:** - **It is also called interior display. It refers to all arrangements that are made inside the shop. Thus the products are displayed inside the shop with a view to induce the real buyers to buy the product.** ### **Show rooms:** - **In case of certain products, consumers always prefer personal inspection. They are not satisfied by reading or listening to an advertisement. For example, Grinders, washing machine, television etc.** ### **ASCI** - **Advertising Standards Council of India is the regulatory body which maintains advertising standards and keeps an eye on misleading and dubious advertising. It was established in October, 1985 as a not-for-profit company.** ### **Meaning and Definition of Personal Selling** - **Personal selling is direct communication between a sales representative and one or more prospective buyers in an attempt to influence each other in a purchase situation. It is the process of contacting the prospective buyers personally and persuading them to buy the products.** ### **Salesmanship** - **Salesmanship is the art of helping to buy intelligently. According to Garfield Blake, "Salesmanship consists of winning the buyer's confidence for the seller's house and goods thereby winning the regular and permanent customer".** ### **Meaning and Definition of Public Relation** - **Public relation is a versatile communication tool. It is used by all types of organisations. It creates a favourable atmosphere for conducting business of the firm. It is a set of communication efforts used to create and maintain favourable relationships between an organisation and its publics.** ### **Meaning of distribution?** - **Distribution is the operation which creates time, place and form utility through the movement of goods and persons from one place to another.** ### **What are the elements of distribution mix?** - **Channels of distribution, warehousing, transportation, inventory.** ### **What is physical distribution?** - **Physical distribution is the moving of finished products from one end of a production line to customers.** ### **What are the activities involved in physical distribution?** - **Transportation, storage and warehousing, loading and unloading of goods, inventory control, material handling, protective packaging, market forecasting, customer service.** ### **What is channels of distribution? or marketing channels?** - **Channels is a set of independent organizations involved in the process of making product or service available for use or consumption.** ### **What are the functions of channels of distribution?** - **Information gathering, consumer motivation, placing orders, bargaining, risk bearing, inventory management, promote higher standard of living. Helps to accomplish marketing objectives, value addition, marketing research, demand forecasting.** ### **What is length of channel?** - **Length of channel refers to the number of intermediaries between the producer and consumers. It is also called channel level.** ### **What is zero level channel?** - **It is also called direct marketing channel. This channel consists of manufacturer and customer. There are no intermediaries at all. The manufacturer sells directly to consumers.** ### **What is mass distribution or intensive distribution?** - **In intensive distribution, all available outlets are used for distribution of products. This facilitates maximum sales for a product.** ### **What is selective distribution?** - **In this policy, the marketer selects a limited number of wholesalers or retail distributors. The marketer will select only the best distributors and concentrates efforts on them.** ### **What is exclusive distribution?** - **This is the practice of selecting only one dealer in one area called territory and giving it the exclusive right to distribute the company's products.** ### **Meaning of channel conflict?** - **Channel conflict is a clash of goals and methods among the members of a distribution channel. Channel conflict refers to a situation when channel members are opposed to each other.** ### **What are the different types of middleman?** - **This conflict arises between middlemen of different marketing channels. Merchant middlemen, Agent middlemen, facilitators.** ### **What is channel competition?** - **Channel competition refers to the efforts by those within a channel of distribution or by channels as a whole to establish dominance over the others.** ### **What is channel integration?** - **In a conventional marketing system, the channel members have no affiliation with one another. All the members operate independently. The conventional channel system comprises an independent producer, wholesalers and retailers.** ### **Who is merchant Middlemen?** - **Merchant middlemen are those who take title to goods with a view to selling them at a profit. They help in the distribution of goods by acting as intermediaries between manufacturers and consumers. Ex: Wholesalers, Retailers, Jobbers.** ### **Facilitators?** - **Facilitators are those who assist in the performance of distribution but neither take title to goods nor undertake purchases or sales. Ex: transportation company, Bank etc.** ### **Who is whole saler?** - **Wholesaler is the first intermediary in the channels of distribution. He is a trader who deals in large quantity. He purchases the goods from manufacturers in bulk quantity and sells it to retailers in small quantity.** ### **What are the different types of retailers?** - **Itinerant retailers and fixed shop retailers. Itinerant retailers include Hawkers, peddlers, market traders, street vendors, cheap jacks. In fixed shop, there are two types of retail trade: small scale and large scale retail shop.** ### **What is online marketing?** - **It means marketing through the internet. It is the use of the internet and related digital technologies to achieve marketing objectives and support the modern concept.** ### **Department Stores** - **A department store is a large-scale retail establishment having in the same building a number of departments each dealing in one particular type of product.** ### **Chain Stores (Multiple Shops)** - **Chain stores or multiple shops is a system of branch shops operated under a centralized management and dealing in similar lines of goods.** ### **Combination Store** - **Combination store sells food and drugs in one store or in two stores located side by side. This is larger than super store. It has a large selling space (average 55,000 sq. ft.).** ### **Super Bazars** - **These are large retail stores organised by co-operative societies which sell a variety of products under a single roof. The goods sold in super-bazars include consumer goods which are provided at wholesale rates from manufacturers or wholesalers.** ### **Super Market** - **The term 'Super Market' is a combination of two words 'Super + Market'. The word 'Super' means very big. The word 'Market' means a place of sale and purchase. Thus, super market means a very big market.** ### **Hyper market** - **Hyper market is a huge retail format. It is larger than super stores. Its size ranges from 2,25,000 to 3,25,000 sq. ft. It offers 45,000 to 60,000 different types of low-priced products. It is usually situated out of towns.**