Business Studies 6 Marks Question

1. Two major concepts related to government policy are:

1. Liberalisation: The economic reforms that were introduced were aimed at liberalising the Indian business and industry from all unnecessary controls and restrictions. The main aim was to liberalise the Indian business industry from excessive government control and to give complete freedom to make their own decisions regarding the investments, marketing, pricing and production.
2. Globalisation: Globalisation means the integration of the various economies of the world leading towards the emergence of a cohesive global economy. Globalisation refers to the process of securing socioeconomic integration and development of various economies of the world. It is a conscious and active process associated with free flow of information, knowledge, services and goods so as to expand business and trade across the borders of countries. It aims at increasing openness, growing economic independence and promoting economic integration in the world economy.

2. Impact of liberalization and Globalisation on Indian industry and business:

1. Increasing competition: As a result of changes in the rules of industrial licensing and entry of foreign firms, competition for Indian firms has increased especially in service industries like telecommunications, airlines,banking, insurance, etc. which were earlier in the public sector.
2. More demanding customers: Customers today have become more demanding because they are well-informed. Increased competition in the market gives the customers wider choice in purchasing better quality of goods and services.
3. Rapidly changing technological environment: Increased competition forces the firms to develop new ways to survive and grow in the market. New technologies make it possible to improve machines, process, products and services. The rapidly changing technological environment creates tough challenges before smaller firms.

1. Labeling: A simple looking but important task in the marketing of goods relates to designing the label to be put on the package. The label may vary from a simple tag attached to the product (such as in case of local unbranded products like sugar, wheat, pulses, etc.) indicating some informationabout the quality or price, to complex graphics that are part of the package, like the ones on branded products.
2. Functions of labeling:

1. Describe the Product and Specify its Contents: Let us look at some of the labels of the products used by us in our day to day life. The label on the package of a local tea company describes the company as ‘ Mohini Tea Company, an ISO 9001:200C Certified Company’; the Package of a brand of Coconut Oil describes the product as pure coconut oil with Heena, amla, Lemon and specifies how these are good for Hair. Thus, one of the most important functions of labels is to describe the product, its usage, cautions in use, etc. and specify its contents.
2. Identification of the Product or Brand: The other important function performed by labels is to help in identifying the product or brand. For example, the brand name of and product, say Biscuits or Potato Chips imprinted on its package helps us to identify, from number of packages, which one is our favourite brand.
3. Grading of Products: Another important function performed by labels is to help grading the products into different categories. Sometimes marketers assign different grades to indicate different features or quality of the product.
4. Help in Promotion of Products: An important function of label is to aid in promotion of the products. A carefully designed label can attract attention and give reason to purchase. We see many product labels providing promotional messages for example, the pack of a popular Amla Hair Oil states, ‘Baalon mein Dum, Life mein Fun’.
5. Providing In formation Required by Law: Another important function of labeling is to provide information required by law. For example, the statutory warning on the package of Cigarette or Pan Masala, ‘Smoking is Injurious to Health’.

1. Gathering and Analysing Market Information: One of the important functions of a marketer is to gather and analyse market information. This is necessary to identify the needs of the customers and take various decisions for the successful marketing of the products and services. This is important for making an analysis of the available opportunities and threats as well as strengths and weaknesses of the organisation and help in deciding what opportunities can best be pursued by it.
2. Standardisation and Grading: Standardisation refers to producing goods of predetermined specifications, which helps in achieving uniformity and consistency in the output. Standardisation ensures the buyers that goods conform to the predetermined standards of quality, price and packaging and reduces the need for inspection, testing and evaluation of the products Grading is the process of classification of products into different groups, on the basis of some of its important characteristics such as quality, size, etc
3. Branding: A very important decision area for marketing of most consumer products is whether to sell the product in its generic name (name of the category of the product, say Fan, Pen, etc.) or to sell them in a brand name (such as Pollar Fan or Rottomac Pen). Brand name helps in creating product differentiations, i.e., providing basis for distinguishing the product of a firm with that of the competitor, which in turn, helps in building customer’s loyality and in promoting its sale. The important decision areas in respect of branding include deciding the branding strategy, say whether each product will be given a separate brand name or the same brand name will be extended to all products of the company.

Personal Selling means oral presentation of message in the form of conversation with prospective customers for the purpose of making a sale.Qualities of a good salesman:

1. Physical qualities.
2. Psychological qualities.
3. Good behavior.
4. Technical quality.
5. Good communication skills.
6. Honesty.
7. Courtesy.
8. Persistence.
9. Capacity to inspire trust.
10. Good mentally health.

Though advertising is one of the most frequently used medium of promotion of goods and services, it attracts lot of criticism. The opponents of advertising say that the expenditure on advertising is a social waste as it adds to the cost, multiplies the needs of people and undermines social values.

1. Adds to Cost: The opponents of advertising argue that advertising unnecessarily adds to the cost of product, which is ultimately passed on to the buyers in the form of high prices. An advertisement on TV, for a few seconds, for example, costs the marketers several lakhs of rupees.
2. Undermines Social Values: Another important criticism of advertising is that it undermines social values and promotes materialism. It breeds discontent among people as they come to know about new products and feel dissatisfied with their present state of affairs. Some advertisements show new life styles, which don’t find social approval.
3. Confuses the Buyers: Another criticism against advertisement is that so many products are being advertised which makes similar claims that the buyer gets confused as to which one is true and which one should be relied upon. For example, we may note similar claims of whiteness or stain removing abilities in competing brands of detergent powder or claims of whiteness of tooth or ‘feelings of freshness’ in competing brands of toothpaste that it is sometimes confusing to us as to which one to buy.
4. Encourages Sale of Inferior Products: Advertising does not distinguish between superior and inferior products and persuade people to purchase even the inferior products. In fact superiority and inferiority depends on the quality, which is a relative concept. The desired level of quality will depend on the economic status and preferences of the target customers. Advertisements sell products of a given quality and the buyers will buy if it suits their requirements.

1. Product Designing and Development: Another important marketing activity or decision area relates to product designing and development. The design of the product contributes to making the product attractive to the target customers. A good design can improve performance of a product and also give it a competitive advantage in the market. For example, when we plan to buy any product say a motorbike, we not only see its features like cost, mileage, etc. but also the design aspects like its shape, style, etc.
2. Standardisation and Grading: Standardisation refers to producing goods of predetermined specifications, which helps in achieving uniformity and consistency in the output. Standardisation ensures the buyers that goods conform to the predetermined standards of quality, price and packaging and reduces the need for inspection, testing and evaluation of the products. Grading is the process of classification of products into different groups, on the basis of some of its important characteristics such as quality, size, etc
3. Customer Support Services: A very important function of the marketing management relates to developing customer support services such as after sales services, handling customer complaints and adjustments, procuring credit services, maintenance services, technical services and consumer information. All these services aim at providing maximum satisfaction to the customers, which is the key to marketing success in modern days. Customer support services prove very effective in bringing repeat sales from the customers and developing brand loyality for a product.
4. Pricing of Products: Price of product refers to the amount of money customers have to pay to obtain a product. Price is an important factor affecting the success or failure of a product in the market. The demand for a product or service is related to its price. Generally lower the price, higher would be the demand for the product and vice-versa. The marketers have to properly analyse the factors determining the price of a product and take several crucial decisions in this respect, including setting the pricing objectives, determining the pricing strategies, determining the price and changing the prices.

The following are the four important factors that affect the determination of the price of a product:

1. Cost of product: The cost of bringing a product to the market plays an important role in determining its price. It consists of the costs of production, distribution and selling. The cost of a product can be classified into three broad categories.
   1. Fixed cost: Fixed cost does not vary with the number of units of produced. Fixed costs remain constant at all levels of output. A few examples of fixed costs are the costs of machinery, land and building.
   2. Variable cost: Variable cost varies in direct proportion to changes in the levels of output. If a higher number of units are produced, then higher variable costs are to be incurred and vice versa. A few examples of variable costs are labour and raw material costs.
   3. Semi-variable cost: Semi-variable cost varies with the level of output (similar to variable cost) but not in direct proportion to it. For example, the commission paid to intermediaries for the sale of a product is a semi-variable cost. Generally, firms determine the price of their products in such a way that they are able to cover all the costs and ensure a profit margin.
2. Demand for product: While determining the price of a product, a firm must also consider the demand for the product. Here, the elasticity of demand plays an important role. In case of elastic demand, a firm cannot charge a higher price as this would lead to a big fall in the demand for its product. On the other hand, if the demand for the product is inelastic, then the firm can charge a higher price, as even at a higher price, the demand would not fall much. Thus, depending on the elasticity of demand, firms fix lower prices for their goods with elastic demand and higher prices for goods with inelastic demand.
3. Degree of competition in the market: Generally, the higher the degree of competition in the market, the lower is the price that a firm charges for its product. This is because, in case of high competition, if a firm attempts to charge a higher price, then it would lose its customers to its competitors. On the other hand, if a firm faces very little competition for its product, then it can charge a higher price.

The following are three of the factors:

1. Characteristics of the company: The two important characteristics of a company that affect the choice of channel are its financial strength and the degree of control that the company wishes to have over the intermediaries. Shorter channels require greater funds than longer channels. It also offers greater control over the members of the channel (intermediaries). Thus, companies which are financially strong or wish to command greater control over the channel of distribution opt for shorter channels of distribution.
2. Competitive factors: The degree of competition and the channels opted by other competitors affect the choice of distribution channel. Depending on its policies, a company may adopt a similar channel as adopted by its competitors or opt for a different channel. For example, if competitors of a company opt for sales through retail stores, it may also do the same or it can opt for a different channel such as direct sales.
3. Market factors: Many of the market factors that affect the choice of channels of distribution include size of the market, geographical concentration of the buyers and size of the purchase. For instance, in case of large markets where there are a large number of potential customers and thyese potential buyers are located in a large geographical area, then a large number of intermediaries are required. Thus, in this case long channels of distribution are opted for rather than short ones. Similarly, if the product is purchased in large quantities, then the organisation can supply the product directly without the use of intermediaries. On the other hand, if small quantities of the product are purchased, the organisation may prefer the involvement of intermediaries such as retailers.

Advertising refers to an impersonal, paid form of communication that is used by the marketers for the promotion of goods and services. It is an important and essential tool for promotions as it covers a wide mass of geographical area and reaches out to the maximum number of people.
The following points highlight the role of advertising:

1. Wide reach: Advertising plays an important role in marketing as it helps in the promotion of the product by reaching out to the masses. For instance, advertising in newspapers and daily magazines helps in attracting customers over a large geographical area.
2. Enhances customer’s confidence: With advertising, consumers feel safer and are assured about the quality of the product. This induces them to buy the product and feel satisfied. Hence, advertising enhances consumer confidence and satisfaction.
3. Product expressiveness: With evolving technology and the new ways of creating graphics, designs and art, the advertising has moved onto a different level. Today, with advertisements, even simple products can be displayed as attractive, thus playing an important role in marketing.
4. Cost effective: Advertising is a cheap source of communication if the supplier wants to reach out to a large number of consumers. This is because the total cost of advertising is divided and gets spread over the communications links that are established. This in turn lowers down the per-unit cost of advertising.

Public relations refer to the activities undertaken by an organisation to promote and protect its image or its products. It aims at strengthening the relations of the company with its customers, shareholders, employees, investors and various other players that are a part of the company directly or indirectly. Under this method, the company can use a wide variety of tactics to manage and promote its reputation.
The following points highlight the role of public relations in marketing management:

1. Maintaining press relations: For any organisation, it is very important to maintain and spread positive news about the organisation to the outside world. For this, it requires to maintain good relations with the press which is in turn done through the public relations department of the company.
2. Publicity of the product: In case the company wants to launch a new product, the public relations department plays an important role in conducting seminars and events so as to facilitate the promotion and publicity of the product.
3. Maintaining corporate communication: In order to maintain goodwill and reach the target markets an organisation needs to communicate with public and employees. For this, its takes help of the newsletters, articles, brochures, etc.
4. Lobbying: Organisations have to deal with government officials in regards with policies in finance and trade related matters. Here also, the public relations department plays a role in promoting or defeating the regulations that affect the organisation.
5. Counselling: The public relations department plays an advisory role by providing counselling to the management on general issues. These issues may pertain to contributing money for social causes such as education, environment and much more.

Difference between advertising and personal selling:

Basis	Advertising	Personal Selling
Nature	It is an impersonal form of communication.	It is a personal form of communication.
Message	It involves transmission of standardised messages.	It adjusts the sales talk keeping in view customer’s background and needs.
Flexibility	It is inflexible as the message can’t be adjusted to the needs of the buyer.	It is highly flexible. As the message can be adjusted.
Reach	It reaches masses.	Only a limited number of people can be contacted.
Cost	The cost per person is very low.	The cost per person is quite high.
Coverage	It can cover the market in a short time.	It takes a lot of time to cover the entire market.
Media used	It makes use of mass media such as television, radio, newspaper, and magazines.	It makes use of sales staff, which has limited reach.
Feedback	It lacks direct feedback. Marketing research efforts are needed to judge customers’ reactions.	It provides direct and immediate feed back.
Role	It is more useful in creating and building interest of the consumers in the firm’s products.	It plays important role at the awareness stage of decision making.
Suitability	It is more useful in marketing to the ultimate consumers who are large in number	It is more helpful in selling products to the industrial buyers or to intermediaries who are relatively few in number.

Components of Physical Distribution are:

1. Order Processing: In a typical buyer -seller relationship order placement is the first step. Products flow from manufacturers to customers via channel members while orders flow in the reverse direction, from customers to the manufacturers. A good physical distribution system should provide for an accurate and speedy processing of orders, in the absence of which goods would reach the customers late or in wrong quantity or specifications. This would result in customer dissatisfaction, with the danger of loss of business and goodwill.
2. Transportation: Transportation is the means of carrying goods and raw materials from the point of production to the point of sale. It is one of the major elements in the physical distribution of goods. It is important because unless the goods are physically made available, the sale cannot be completed. Warehousing: Warehousing refers to the act of storing and assorting products in order to create time utility in them. The basic purpose of warehousing activities is to arrange placement of goods and provide facilities to store them. The need for warehousing arises because there may be difference between the time a product is produced and the time it is required for consumption. Generally the efficiency of a firm in serving its customers will depend on where these warehouses are located and where are these to be delivered.
3. Inventory Control: Linked to warehousing decisions are the inventory decisions which hold key to success for many manufacturers, especially those where the perunit cost is high. A very important decision in respect of inventory is deciding about the level of inventory. Higher the level of inventory, higher will be the level of service to customers but the cost of carrying the inventory will also be high because lot of capital would be tied up in the stock. Thus, a balance is to be maintained in respect of the cost and customer satisfaction.

On the basis of Durability of products, consumer products are classified as follows:

1. Non-durable Products: The consumer products which are normally consumed in one or few uses are called non-durable products. For example, we purchase products like toothpaste, detergents, bathing soap and stationary products etc. From the marketing point of view, these products generally command a small margin, should be made available in many locations and need to be heavily advertised.
2. Durable Products: Those tangible consumer products which normally survive many uses, for example, refrigerator, radio, bicycle, sewing machine and kitchen gadgets are referred to as durable products. These goods are generally used for a longer period, command a higher per unit margin, require greater personal-selling efforts, guarantees and after sales services, on the part of the seller.
3. Services: The durable and nondurable goods are tangible in the sense that these have a physical existence and can be seen and touched. Services are intangible in form. By services we mean those activities, benefits or satisfactions, which are offered for sale, e.g., dry cleaning, watch repairs, hair cutting, postal services, services offered by a doctor, an architect and a lawyer.

Packaging plays a very important role in the marketing success or failure of many products, particularly the consumer non-durable products. In fact if one makes an analysis of the reasons for the success of some of the successful products in the recent past, it can be noted that packaging has played its due role.Functions of packaging:

1. Product Identification: Packaging greatly helps in identification of the products. For example, Colgate in red colour, or Ponds cream jar can be easily identified by its package.
2. Product Protection: Packaging protects the contents of a product from spoilage, breakage, leakage, pilferage, damage, climatic effect, etc. This kind of protection is required during storing, distribution and transportation of the product.
3. Facilitating Use of the Product: The size and shape of the package should be such that it should be convenient to open, handle and use for the consumers. Cosmetics, medicines and tubes of toothpastes are good examples of this.
4. Product Promotion: Packaging is also used for promotion purposes. A startling colour scheme, photograph or typeface may be used to attract attention of the people at the point of purchase. Sometimes it may work even better than advertising. In self-service stores, this role of packaging becomes all the more important.

The tool is Personal Selling. Personal selling involves oral presentation of message in the form of conversation with one or more prospective customers for the purpose of making sales. It is a personal form of communication.Importance to Businessmen:
Personal selling is a powerful tool for creating demand for a firm’s products and increasing their sale. The importance of personal selling to a business organisation may be described as follows:

1. Effective Promotional Tool: Personal selling is very effective promotional tool, which helps in influencing the prospects about the merits of a product and thereby increasing its sale.
2. Flexible Tool: Personal selling is more flexible than other tools of promotion such as advertising and sales promotion. It helps business persons in adopting their offer in varying purchase situations.
3. Minimises Wastage of Efforts: Compared with other tools of promotion, the possibility of wastage of efforts in personal selling is minimum. This helps the business persons in bringing economy in their efforts.
4. Consumer Attention: There is an opportunity to detect the loss of consumer attention and interest in a personal selling situation. This helps a business person in successfully completing the sale.

The following information is to be PROVIDED ON THE LABEL:

Name of the product. Name of the manufacturer. Address of the manufacturer. Net weight when packed. Manufacturing date. Expiry date. Maximum retail price (MRP) Batch number. Directions for use. Contents.

Generally consumers prefer to buy goods directly from the producers but it is not always possible. This is so because of the following factors:

1. Product related factors: Goods which are standardized, are non perishable, non complex or have a low unit value are sold by the producers through indirect channels.
2. Company characteristics: When the financial strength of the company is not very strong or when the company does not want control over the channel members, it may go in for indirect channels.
3. Competitive factors: The company may decide to use indirect channel either to go with the competitor or be different from them.
4. Market factors: When the size of the market is large, consumers are widely dispersed or the order size is small, the company may decide to use indirect channels.
5. Environmental factors: Keeping in mind the economic conditions and legal constraints, a company may decide to use indirect channels.

The element of the marketing mix which affect the revenue and profits of the firm is PRICE. Price is the amount of money customers have to pay to obtain the product. In case of most of the products, level of price affects the level of their demand. Pricing occupies an important place in the marketing of goods and services by a firm. No product can be launched without a price tag or at least some guidelines for pricing.Factors that adversely affect the price of product are as follows:

1. Product Cost: One of the most important factor affecting price of a product or service is its cost. This includes the cost of producing, distributing and selling the product. The cost sets the minimum level or the floor price at which the product may be sold. There are broadly three types of costs: viz., Fixed Costs, Variable Costs and Semi Variable Costs. Fixed costs are those costs, which do not vary with the level of activity of a firm say with the volume of production or sale.
2. The Utility and Demand: While the product costs set the lower limits of the price, the utility provided by the product and the intensity of demand of the buyer sets the upper limit of price, which a buyer would be prepared to pay. In fact the price must reflect the interest of both the parties to the transaction-the buyer and the seller.
3. Extent of Competition in the Market: Between the lower limit and the upper limit where would the price settle down? This is affected by the nature and the degree of competition. The price will tend to reach the upper limit in case there is lesser degree of competition while under conditions of free competition, the price will tend to be set at the lowest level.
4. Government and Legal Regulations: In order to protect the interest of public against unfair practices in the field of price fixing, Government can intervene and regulate the price of commodities. Government can declare a product as essential product and regulate its price.
5. Pricing Objectives: Pricing objectives are another important factor affecting the fixation of the price of a product or a service. Generally the objective is stated to be maximise the profits.

'Bending the customer according to the product’ refers to SELLING and ‘Developing the product according to customer needs’ refers to MARKETING.Difference between marketing and selling.

Basis	Selling	Marketing
Starting point	Starting point is the factory i.e. selling begins after production of goods.	Starting point is the market i.e. Marketing begins before production after analysing the needs and wants of the customers.
Main focus	Main focus is on the existing product, i.e., selling focuses on affecting transfer of title and possession of existing goods.	Main focus is on the customer needs i.e. marketing focuses on achieving maximum satisfaction of the customer’s needs.
Means/ strategies	Selling involves efforts like promotion and persuasion i.e. selling & promoting the product.	Marketing uses integrated marketing efforts.
Ends	In selling, the aim is to earn profit through sales volume.	In marketing, the aim is to earn profit through customer satisfaction.
Scope	Selling concept has a narrow scope - it is a part of marketing.	Marketing concept has a wider scope - it includes selling.
Orientation	Selling is internal oriented as it presupposes existing of demand.	Marketing is customer oriented/ external oriented as it emphasises on creation and demand.

Packaging: The act of designing and producing the container or wrapper of a product is referred as packaging. There can be three different levels of packaging. viz Primary package, Secondary packaged.Importance of packaging:

1. Rising Standards of Health and Sanitation: Because of the increasing standards of living in the country, more and more people have started purchasing packed goods as the chances of adulteration in such goods are minimised.
2. Self Service Outlets: The self-service retail outlets are becoming very popular, particularly in major cities and towns. Because of this, some of the traditional role assigned to personal selling in respect of promotion has gone to packaging.
3. Innovational Opportunity: Some of the recent developments in the area of packaging have completely changed the marketing scene in the country. For example, milk can now be stored for 4-5 days without refrigeration in the recently developed packing materials. Similarly, in the area of pharmaceuticals, soft drinks, etc., lots of new innovations have come in respect of packaging. As a result, the scope for the marketing of such products has increased.
4. Product Differentiation: Packaging is one of the very important means of creating product differentiation. The colour, size, material etc., of package makes real difference in the perception of customers about the quality of the product. For example, by looking at the package of a product say Paint or Hair Oil, one can make some guess about quality of the product contained in it.

1. Refunds: It is a technique of sales promotion in which a part of price paid by customer is returned back on presenting some proof of purchase, e.g., on return of empty foils or wrapper, get a refund of Rs. 5.
2. Instant draw and assigned gifts: It is a technique of sales promotion in which assured gifts are given to the customers instantly by participating in a draw, on purchase of a product.
3. Financing: It is a technique of sales promotion in which easy financing schemes are offered such as ‘24 easy instalments or the amount to be paid as post dated cheques’.
4. Sampling: It is a technique of sales promotion in which a free sample of a product is offered to the customer, e.g., a packet of detergent powder to potential customers at the time of launch of a new brand.

Factors that adversely affect the price of product are as follows:
Product Cost: One of the most important factor affecting price of a product or service is its cost. This includes the cost of producing, distributing and selling the product. The cost sets the minimum level or the floor price at which the product may be sold. There are broadly three types of costs: viz., Fixed Costs, Variable Costs and Semi Variable Costs. Fixed costs are those costs, which do not vary with the level of activity of a firm say with the volume of production or sale.
The Utility and Demand: While the product costs set the lower limits of the price, the utility provided by the product and the intensity of demand of the buyer sets the upper limit of price, which a buyer would be prepared to pay. In fact the price must reflect the interest of both the parties to the transaction-the buyer and the seller.
Extent of Competition in the Market: Between the lower limit and the upper limit where would the price settle down? This is affected by the nature and the degree of competition. The price will tend to reach the upper limit in case there is lesser degree of competition while under conditions of free competition, the price will tend to be set at the lowest level.
Government and Legal Regulations: In order to protect the interest of public against unfair practices in the field of price fixing, Government can intervene and regulate the price of commodities. Government can declare a product as essential product and regulate its price.

Following are the differences between marketing and selling:

Basis	Marketing	Selling
Meaning	Marketing means determining the requirements of the customers and supplying products which meet their requirements.	Selling is transfer of goods and services from the producers to the consumers.
Objective/ aim	Aims at maximising of customer satisfaction as a route to profit maximisation.	Selling aims at maximising profits through sales volume.
Process	It is a process by which people satisfy their needs and wants by obtaining products in exchange for money.	It is a process by which sellers aims at maximising profits by selling products in exchange for money.
Focus	Marketing focuses on achieving maximum satisfaction of the customer’s needs and wants.	Selling focuses on affecting transfer of title and possession of goods from sellers to consumers or users.
Scope	Marketing has a wider scope. Includes not only selling but other activities like advertising market research,product planning, etc.	Selling has a narrower scope-it is a part of marketing and is limited to transferring possession and ownership of goods from the seller to the buyer.
Start and end of activities	Marketing begins before production and continues even after the sale has taken place.	Selling begins after production and ends with the sale of goods.
Orientation	Marketing is customer oriented/external oriented as it emphasises creation and maintenance of demand.	Selling is internal oriented as it presupposes existing of demand.
Emphasis	In marketing, the attempt is to develop the product and other strategies as per the customer needs.	In selling, the emphasis is on bending the customer according to the product.
Difference in the Strategies	Marketing uses integrated marketing efforts involving strategies in respect of product, promotion, pricing and physical distribution.	Selling involves efforts like promotion and persuasion i.e. seller uses sales efforts to offload what he has on to the buyer.

Difference between 'Advertising' and 'Personal Selling':

Point of Difference	Advertising	Personal Selling
Form	It is a impersonal form of communication.	It is a personal form of communication.
Message	It transmits standardised form of message.	Sales talk is adjusted keeping in view customer’s background and needs.
Flexibility	It is inflexible.	Flexible.
Reach	Reaches masses.	Limited people.
Cost	Cost per person is very low.	High.
Time	Can cover market in short time.	Time consuming.
Media	Use of mass media.	Sales staff is used.
Feedback	Lacks direct feedback.	Provides direct and immediate feedback.
Role	More useful in creating and building interest of consumers in the firm’s product.	It plays important role at the awareness stage of the decision making.
Suitability	More useful in marketing to the ultimate consumers who are large in number.	More helpful in selling products to the industrial buyers, intermediaries who are relatively few in number.

Name of Technique is - RebateOther techniques are:

1. Discount: Offering products at less than list price. Example, a shoe company’s offer of ‘Discount Up to 50%’ or a shirt marketer’s offer of ‘50 + 40% Discount
2. Refunds: Refunding a part of price paid by customer on some proof of purchase, say on return of empty foils or wrapper. This is commonly used by food product companies, to boost their sales.
3. Quantity Gift: Offering extra quantity of the product commonly used by marketer of toiletry products. For example, a shaving cream’s offer of ‘40% Extra’ or A Hotel’s offer of “Take a 2 Night 3 Days Package At the Hotel and Get an Extra Night Stay At Just Rs 500” or ‘Buy 2 Get 1 Free’ offer of a marketer of shirts.
4. Instant Draws and Assigned Gift: For example, ‘Scratch a Card’ or ‘Burst a Cracker’ and instantly win a Refrigerator, Car, T-shirt, Computer, with the purchase of a TV.
5. Lucky Draw: For example, the offer of a bathing soap to win a gold coin on lucky draw coupon for free petrol on purchase of certain quantity of petrol from given petrol pump or luckydraw coupon on purchase of easy undergarment and win a car offer.

Factors which affect the choice of channel of distribution are:Product Related Factors: The important product related considerations in deciding the channels include whether the product an industrial or a consumer product, whether it is a perishable or a non-perishable product, what is the unit value of the product and the degree of complexity of the product.
Company Characteristics: The important company characteristics affecting the choice of channels of distribution include the financial strength of the company and the degree of control it wants to hold on other channel members. Direct selling involves lot of funds to be invested in fixed assets say for starting own retail outlets or engaging large number of sales force. Indirect selling through intermediary does not involve deployment of huge funds on these aspects.

1. Marketing Rercseah: means application of research process in solving marketing problems. First, the marketers need to identify what the customer needs and wants are, when they are likely to buy, in what quantities they are to buy, from where they buy, etc. Customers tend to be different.
2. Product Planning: The whole range of tasks that are involved in the product creation fall under the product planning function. The marketer must take these decisions judiciously so that customer needs are met.
3. Buying and Assembling: Buying refers to procuring inputs from the environment and process them and send them again back to the environment in the forms of finished products for sale in the market. An assembly line depicts the order of operations, which are employed to assemble various parts one by one in order to create the final product. Thus, assembly of various parts of inputs is another important function of a marketer. Assembling also means collecting at one place small lots purchased from different sources so as to economise the cost of transportation and storage.

1. Labeling: A simple looking but important task in the marketing of goods relates to designing the label to be put on the package. The label may vary from a simple tag attached to the product (such as in case of local unbranded products like sugar, wheat, pulses, etc.) indicating some informationabout the quality or price, to complex graphics that are part of the package, like the ones on branded products.
2. Functions of labeling:

1. Describe the Product and Specify its Contents: Let us look at some of the labels of the products used by us in our day to day life. The label on the package of a local tea company describes the company as ‘Mohini Tea Company, an ISO 9001:200C Certified Company’; the Package of a brand of Coconut Oil describes the product as pure coconut oil with Heena, amla, Lemon and specifies how these are good for Hair. Thus, one of the most important functions of labels is to describe the product, its usage, cautions in use, etc. and specify its contents.
2. Identification of the Product or Brand: The other important function performed by labels is to help in identifying the product or brand. For example, the brand name of and product, say Biscuits or Potato Chips imprinted on its package helps us to identify, from number of packages, which one is our favourite brand.
3. Grading of Products: Another important function performed by labels is to help grading the products into different categories. Sometimes marketers assign different grades to indicate different features or quality of the product.
4. Help in Promotion of Products: An important function of label is to aid in promotion of the products. A carefully designed label can attract attention and give reason to purchase. We see many product labels providing promotional messages for example, the pack of a popular Amla Hair Oil states, ‘Baalon mein Dum, Life mein Fun’.
5. Providing In formation Required by Law: Another important function of labeling is to provide information required by law. For example, the statutory warning on the package of Cigarette or Pan Masala, ‘Smoking is Injurious to Health’.

1. Product Related Factors: The important product related considerations in deciding the channels include whether the product is an industrial or a consumer product, whether it is a perishable or a non-perishable product, what is the unit value of the product and the degree of complexity of the product.
2. Company Characteristics: The important company characteristics affecting the choice of channels of distribution include the financial strength of the company and the degree of control it wants to hold on other channel members. Direct selling involves lot of funds to be invested in fixed assets say for starting own retail outlets or engaging large number of sales force. Indirect selling through intermediary does not involve deployment of huge funds on these aspects.
3. Competitive Factors: The choice of channel is also affected by the channel selected by competitors in the same industry. If the competitor’s have selected a particular channel say Chemist shops for the sale of toiletry products like hair oil, the other firm may also like to select the similar channel. In some cases producers may want to avoid the channels used by competitors.
4. Environmental Factors: Other important factors affecting the choice of channels of distribution include environmental factor such as economic condition and legal constraints. In a depressed economy marketers use shorter channels to distribute their goods in an economical way.

Price is the amount of money customers have to pay to obtain the product. In case of most of the products, level of price affects the level of their demand. Pricing occupies an important place in the marketing of goods and services by a firm. No product can be launched without a price tag or at least some guidelines for pricing.Factors that adversely affect the price of product are as follows:

1. Product Cost: One of the most important factor affecting price of a product or service is its cost. This includes the cost of producing, distributing and selling the product. The cost sets the minimum level or the floor price at which the product may be sold. There are broadly three types of costs: viz., Fixed Costs, Variable Costs and Semi Variable Costs. Fixed costs are those costs, which do not vary with the level of activity of a firm say with the volume of production or sale.
2. The Utility and Demand: While the product costs set the lower limits of the price, the utility provided by the product and the intensity of demand of the buyer sets the upper limit of price, which a buyer would be prepared to pay. In fact the price must reflect the interest of both the parties to the transaction—the buyer and the seller.
3. Extent of Competition in the Market: Between the lower limit and the upper limit where would the price settle down? This is affected by the nature and the degree of competition. The price will tend to reach the upper limit in case there is lesser degree of competition while under conditions of free competition, the price will tend to be set at the lowest level
4. Government and Legal Regulations: In order to protect the interest of public against unfair practices in the field of price fixing, Government can intervene and regulate the price of commodities. Government can declare a product as essential product and regulate its price.

Though advertising is one of the most frequently used medium of promotion of goods and services, it attracts lot of criticism. The opponents of advertising say that the expenditure on advertising is a social waste as it adds to the cost, multiplies the needs of people and undermines social values.

1. Adds to Cost: The opponents of advertising argue that advertising unnecessarily adds to the cost of product, which is ultimately passed on to the buyers in the form of high prices. An advertisement on TV, for a few seconds, for example, costs the marketers several lakhs of rupees.
2. Undermines Social Values: Another important criticism of advertising is that it undermines social values and promotes materialism. It breeds discontent among people as they come to know about new products and feel dissatisfied with their present state of affairs. Some advertisements show new life styles, which don’t find social approval.
3. Confuses the Buyers: Another criticism against advertisement is that so many products are being advertised which makes similar claims that the buyer gets confused as to which one is true and which one should be relied upon. For example, we may note similar claims of whiteness or stain removing abilities in competing brands of detergent powder or claims of whiteness of tooth or ‘feelings of freshness’ in competing brands of toothpaste that it is sometimes confusing to us as to which one to buy.
4. Encourages Sale of Inferior Products: Advertising does not distinguish between superior and inferior products and persuade people to purchase even the inferior products. In fact superiority and inferiority depends on the quality, which is a relative concept. The desired level of quality will depend on the economic status and preferences of the target customers. Advertisements sell products of a given quality and the buyers will buy if it suits their requirements.

1. Labeling: A simple looking but important task in the marketing of goods relates to designing the label to be put on the package. The label may vary from a simple tag attached to the product (such as in case of local unbranded products like sugar, wheat, pulses, etc.) indicating some informationabout the quality or price, to complex graphics that are part of the package, like the ones on branded products.
2. Functions of labeling:

1. Describe the Product and Specify its Contents: Let us look at some of the labels of the products used by us in our day to day life. The label on the package of a local tea company describes the company as ‘ Mohini Tea Company, an ISO 9001:200C Certified Company’; the Package of a brand of Coconut Oil describes the product as pure coconut oil with Heena, amla, Lemon and specifies how these are good for Hair. Thus, one of the most important functions of labels is to describe the product, its usage, cautions in use, etc. and specify its contents.
2. Identification of the Product or Brand: The other important function performed by labels is to help in identifying the product or brand. For example, the brand name of and product, say Biscuits or Potato Chips imprinted on its package helps us to identify, from number of packages, which one is our favourite brand.
3. Grading of Products: Another important function performed by labels is to help grading the products into different categories. Sometimes marketers assign different grades to indicate different features or quality of the product.
4. Help in Promotion of Products: An important function of label is to aid in promotion of the products. A carefully designed label can attract attention and give reason to purchase. We see many product labels providing promotional messages for example, the pack of a popular Amla Hair Oil states, ‘Baalon mein Dum, Life mein Fun’.
5. Providing In formation Required by Law: Another important function of labeling is to provide information required by law. For example, the statutory warning on the package of Cigarette or Pan Masala, ‘Smoking is Injurious to Health’.

1. Gathering and Analysing Market Information: One of the important functions of a marketer is to gather and analyse market information. This is necessary to identify the needs of the customers and take various decisions for the successful marketing of the products and services. This is important for making an analysis of the available opportunities and threats as well as strengths and weaknesses of the organisation and help in deciding what opportunities can best be pursued by it.
2. Marketing Planning: Another important activity or area of work of a marketer is to develop appropriate marketing plans so that the marketing objectives of the organisation can be achieved. For example a marketer of colour TVs, having 10 per cent of the current market share in the country aims at enhancing his market share to 20 per cent, in the next three years. He will have to develop a complete marketing plan covering various important aspects including the plan for increasing the level of production, promotion of the products, etc. and specify the action programmes to achieve these objectives.
3. Customer Support Services: A very important function of the marketing management relates to developing customer support services such as after sales services, handling customer complaints and adjustments, procuring credit services, maintenance services, technical services and consumer information. All these services aim at providing maximum satisfaction to the customers, which is the key to marketing success in modern days. Customer support services prove very effective in bringing repeat sales from the customers and developing brand loyality for a product.
4. Physical Distribution: Managing physical distribution is another very important function in the marketing of goods and services. The two major decision areas under this function include,

1. Decision regarding channels of distribution or the marketing intermediaries (like whole salers, retailers) to be used.
2. Physical movement of the product from where it is produced to a place where it is required by the customers for their consumption or use. The important decision areas under physical distribution include managing inventory (levels of stock of goods), storage and warehousing and transportation of goods from one place to the other.

Factors which help in price determination are:

1. Objective of Pricing: First of all the objectives of fixing the price should be kept in mind. If a firm decides to maximize profits in the short run, it is likely to charge higher price for its product. On the other hand, it would set a low price of its objective is to capture large market shore and earn more profits in the long-run.
2. Cost: Price charged must enable the businessmen to cover his cost including a reasonable margin of profit.
3. Competition: If there is a keen competition in the market, the price fixed will be lower to stay in the market. When a firm does not have to face competition, it can charge higher price from the customers.
4. Demand-Supply Conditions: Whether the price of the product should be high or low; would much depend on the demand-supply conditions. If demand is more than supply, even a high price might work well. On the contrary, when demand is less than supply only a low price could attract the customers.

Personal Selling or salesmanship refers to physical presentation helped by oral Communication to persuade the customer to buy certain goods and services to satisfy his wants at the right price. The main function of salesmanship is to ‘persuade’ and not to ‘induce’ or ‘Coerce’ people to buy goods. Qualities of Good Salesman:The essential qualities of a good salesman may be summarized as follows:

1. Physical Qualities: A good salesman must always passes a good, healthy and a sound physique and attractive appearance. A salesman must always have a cheerful smile on his face. Pleasing personality, clear voice and natural tone of speaking help to create a good impression on the customer.
2. Mental Qualities: A good salesman should possess mental qualities like : Patience, wide knowledge about his company and its products, initiative, Alertness, Presence of mind, Sound Judgment, Creative imagination, etc.
3. Social Qualities: A good salesman must have good manners, courtesy, empathy A successful salesman needs to be sincere, dependable, cooperative and loyal. He must perform his duties sincerely and honestly. He should have self confidence and optimistic outlook.
4. Vocational Qualities: A good salesman must have full knowledge about his company, products, markets, customers and the sales techniques.

Difference between marketing and selling:

Basis	Selling	Marketing
Meaning	Selling means exchanging goods for money.	Marketing means identifying customer needs and satisfying them.
Part of the process vs wider term	Selling is a part of the process of marketing.	Marketing is a wider term and includes selling.
Transfer of title vs satisfaction of customer needs	Selling focuses on affecting transfer of title and possession of existing goods.	Marketing focuses on achieving maximum satisfaction of the customer’s needs.
Profit through maximizing sales vs customer satisfaction.	Selling aims at maximizing sales and thereby the profits of the firm.	Marketing aims at maximizing customer satisfaction and thereby the profits of the firm.
Start and end of activities	Selling starts after the product is developed and ends with the sale of the product.	Marketing starts much before the product is produced and continues even after the product is sold.
Difference in emphasis	In selling, the emphasis is on bending the customer according to the product.	In marketing, the emphasis is on developing the product as per customer’s needs.
Difference in Strategies.	Selling involves efforts like promotion and persuasion i.e. selling & promoting the product.	Marketing uses integrated marketing efforts.

Consumer products classified on the basis of 'Shopping Efforts Involved' are:

1. Convenience Products: Those consumer products, which are purchased frequently, immediately and with least time and efforts are referred to as convenience goods. Examples of such products are cigarettes, ice creams, medicines, newspaper, stationery items toothpaste. etc. These products have low unit-value and are bought in small qualities.
2. Shopping Products: Shopping products are those consumer goods, in the purchase of which buyers devote considerable time, to compare the quality, price, style, suitability, etc., at several stores, before making purchase them in small numbers.
3. Speciality Products: Speciality products are those consumer goods which have certain special features because of which people make special efforts in their purchase. These products are such, which have reached a brand loyalty of the highest order, with a significant number of buyers. The buyers are willing to spend a lot of time and efforts on the purchase of such products.

Factors which affect the choice of channel of distribution are:

1. Product Related Factors: The important product related considerations in deciding the channels include whether the product an industrial or a consumer product, whether it is a perishable or a non-perishable product, what is the unit value of the product and the degree of complexity of the product.
2. Company Characteristics: The important company characteristics affecting the choice of channels of distribution include the financial strength of the company and the degree of control it wants to hold on other channel members. Direct selling involves lot of funds to be invested in fixed assets say for starting own retail outlets or engaging large number of sales force. Indirect selling through intermediary does not involve deployment of huge funds on these aspects.
3. Competitive Factors: The choice of channel is also affected by the channel selected by competitors in the same industry. If the competitor’s have selected a particular channel say Chemist shops for the sale of toiletry products like hair oil, the other firm may also like to select the similar channel.
4. Market Factors: Important market factors affecting the choice of channel of distribution include size of market, geographical concentration of potential buyers and quantity purchased.
5. Environmental Factors: Other important factors affecting the choice of channels of distribution include environmental factor such as economic condition and legal constraints. In a depressed economy marketers use shorter channels to distribute their goods in an economical way.

Brand Name: That part of a brand, which can be spoken, is called a brand name. In other words, brand name is the verbal component of a brand. For example, Asian Paints, Safola, Maggie, Lifebuoy, Dunlop, and Uncle Chips are the brand names.Characteristics of good brand name:

1. The brand name should be short, easy to pronounce, spell, recognise and remember e.g., Ponds, VIP, Rin, Vim, etc.
2. A brand should suggest the product’s benefits and qualities. It should be appropriate to the product’s function. e.g., Rasika, Genteel, Promise, My Fair Lady and Boost.
3. A brand name should be distinctive e.g., Liril, Sprit, Safari, Zodiac.
4. The brand name should be adaptable to packing or labeling requirements, to different advertising media and to different languages.
5. The brand name should be sufficiently versatile to accommodate new products, which are added to the product line e.g., Maggie, Colgate.

Physical Channels of distribution smoothen the flow of goods by creating possession, place and time utilities. They facilitate movement of goods by overcoming various time, place and possession barriers that exist between the manufacturers and consumers.Functions of Distribution Channels:

1. Sorting: Middlemen procure supplies of goods from a variety of sources, which is often not of the same quality, nature, and size. For example, a wholesaler of cashew nuts may procure a large quantity from different cashew nut producing areas, which would contain nuts of varied quality and sizes. He/She then sorts the nuts into homogenous groups on the basis of the size or quality.
2. Accumulation: This function involves accumulation of goods into larger homogeneous stocks, which help in maintaining continuous flow of supply.
3. Allocation: Allocation involves breaking homogenous stock into smaller, marketable lots.
4. Assorting: Middlemen build assortment of products for resale. There is usually a difference between the product lines made by manufacturers and the assortment or combinations desired by the users.
5. Product Promotion: Mostly advertising and other sales promotion activities are organised by manufacturers. Middlemen also participate in certain activities such as demonstrations, special displays, contests, etc., to increase the sale of products.

The element of the marketing mix which affect the revenue and profits of the firm is PRICE. Price is the amount of money customers have to pay to obtain the product. In case of most of the products, level of price affects the level of their demand. Pricing occupies an important place in the marketing of goods and services by a firm. No product can be launched without a price tag or at least some guidelines for pricing.Factors that adversely affect the price of product are as follows:

1. Product Cost: One of the most important factor affecting price of a product or service is its cost. This includes the cost of producing, distributing and selling the product. The cost sets the minimum level or the floor price at which the product may be sold. There are broadly three types of costs: viz., Fixed Costs, Variable Costs and Semi Variable Costs. Fixed costs are those costs, which do not vary with the level of activity of a firm say with the volume of production or sale.
2. The Utility and Demand: While the product costs set the lower limits of the price, the utility provided by the product and the intensity of demand of the buyer sets the upper limit of price, which a buyer would be prepared to pay. In fact the price must reflect the interest of both the parties to the transaction-the buyer and the seller.
3. Extent of Competition in the Market: Between the lower limit and the upper limit where would the price settle down? This is affected by the nature and the degree of competition. The price will tend to reach the upper limit in case there is lesser degree of competition while under conditions of free competition, the price will tend to be set at the lowest level.
4. Government and Legal Regulations: In order to protect the interest of public against unfair practices in the field of price fixing, Government can intervene and regulate the price of commodities. Government can declare a product as essential product and regulate its price.
5. Pricing Objectives: Pricing objectives are another important factor affecting the fixation of the price of a product or a service. Generally the objective is stated to be maximise the profits.

'Bending the customer according to the product’ refers to SELLING and ‘Developing the product according to customer needs’ refers to MARKETINGDifference between marketing and selling:

Basis	Selling	Marketing
Starting Point	Starting point is the factory i.e. selling begins after production of goods.	Starting point is the market i.e. Marketing begins before production after analysing the needs and wants of the customers.
Main focus	Main focus is on the existing product i.e. selling focuses on affecting transfer of title and possession of existing goods.	Main focus is on the customer needs, i.e. marketing focuses on achieving maximum satisfaction of the customer’s needs.
Means/ Strategies	Selling involves efforts like promotion and persuasion i.e. selling & promoting the product.	Marketing uses integrated marketing efforts.
Ends	In selling, the aim is to earn profit through sales volume.	In marketing, the aim is to earn profit through customer satisfaction.
Scope	Selling concept has a narrow scope - it is a part of marketing.	Marketing concept has a wider scope – it includes selling.
Orientation	Selling is internal oriented as it pre-supposes existing of demand.	Marketing is customer oriented/external oriented as it emphasises on creation and maintenance of demand.

Brand: A brand is a name, term, sign, symbol, design or some combination of them, used to identify the products goods or services of one seller or group of sellers and to differentiate them from those of the competitors Choosing the right brand name is not an easy decision. What makes this decision important is the fact that once a brand name is chosen and the product is launched in the market, changing the brand name is very difficult. So, getting it right the first time is very essential.Following are some of characteristicc, of good brand name.

1. The brand name should be short, easy to pronounce, spell, recognise and remember e.g., Ponds, VIP, Rin, Vim, etc.
2. A brand should suggest the product’s benefits and qualities. It should be appropriate to the product’s function. e.g., Rasika, Genteel, Promise, My Fair Lady and Boost.
3. A brand name should be distinctive e.g., Liril, Sprit, Safari, Zodiac.
4. The brand name should be adaptable to packing or labeling requirements, to differentadvertising media and to different languages.
5. The brand name should be sufficiently versatile to accommodate new products, which are added to the product line e.g., Maggie, Colgate.
6. It should be capable of being registered and protected legally.

1. Discount: It refers to offering products at less than list price. e.g. a shoe company’s offer of ‘Discount Up to 50%
2. Product Combination: It refers to offering another product as gift along with the purchase of a product, e.g. offer of a pack of ½ kg of rice with the purchase of a bag of atta (wheat flour).
3. Financing: It refers to offering easy financing schemes e.g. ‘24 easy instalments orthe amount to be paid as post dated cheques’.
4. Lucky Draw: It refers to taking out a draw on purchase of product and giving gift to the winner. e.g a lucky draw coupon for free petrol on purchase of certain quantity of petrol from given petrol pump.

Marketing Mix is a set of marketing tools that the firm uses to pursue its marketing objectives in a target market. The variables or elements of marketing mix have been classified in to four categories, popularly known as four Ps of marketing viz., Product, Price, Place and Promotion. These elements are combined to create an offer.
Product: In common parlance, the word ‘product’, is used to refer only to the physical or tangible attributes of a product. In marketing, product is a mixture of tangible and intangible attributes, which are capable of being exchanged for a value, with ability to satisfy customer needs. It is anything that can be offered to a market to satisfy a want or need. Products may broadly be classified into two categories-industrial products and consumers’ products. Products, which are purchased, by the ultimate consumers or users for satisfying their personal needs and desires are referred to as consumer products. On the basis of shopping efforts involved, the products are classified as Convenience Product, Shopping Products and Speciality Products. On the basis of their durability, consumer products have been classified into categories-Durable, Non-durable and Services
Pricing: Price may be defined as the amount of money paid by a buyer or received by a seller in consideration of the purchase of a product or service. Generally, if the price of a product is increased, its demand comes down, and vice-versa. Pricing is considered to be an effective competitive weapon. It is also the single most important factor affecting the revenue and profits of a firm. The factors affecting price determination are

1. Product Cost.
2. The Utility and Demand.
3. Competition.
4. Government and Legal Regulations.
5. Marketing Methods Used.

Physical Distribution: There are two important decisions relating to this aspect one regarding physical movement of goods and two, regarding the channels.
Channels of Distribution are set of firms and individuals that take title, or assist in transferring title, to particular goods or services as it moves from the producers to the consumers. Channels of distribution smoothen the flow of goods by creating possession, place and time utilities. The important functions performed by middlemen are:

1. Sorting,
2. Accumulation
3. Allocation,
4. Assorting,
5. Product promotion,
6. Negotiation,
7. Risk taking.

Promotion: Promotion refers to the use of communication with the twin objective of informing potential customers about a product and persuading them to buy it. There are four major tools, or elements of promotion mix, which are.

1. Advertising,
2. Personal Selling,
3. Sales Promotion,
4. Publicity: These tools are used in different combinations to achieve the goals of promotion.

1. Gathering and Analysing Market Information: One of the important functions of a marketer is to gather and analyse market information. This is necessary to identify the needs of the customers and take various decisions for the successful marketing of the products and services. This is important for making an analysis of the available opportunities and threats as well as strengths and weaknesses of the organisation and help in deciding what opportunities can best be pursued by it.
2. Marketing Planning: Another important activity or area of work of a marketer is to develop appropriate marketing plans so that the marketing objectives of the organisation can be achieved. For example a marketer of colour TVs, having 10 per cent of the current market share in the country aims at enhancing his market share to 20 per cent, in the next three years. He will have to develop a complete marketing plan covering various important aspects including the plan for increasing the level of production, promotion of the products, etc. and specify the action programmes to achieve these objectives.
3. Product Designing and Development: Another important marketing activity or decision area relates to product designing and development. The design of the product contributes to making the product attractive to the target customers. A good design can improve performance of a product and also give it a competitive advantage in the market
4. Customer Support Services: A very important function of the marketing management relates to developing customer support services such as after sales services, handling customer complaints and adjustments, procuring credit services, maintenance services, technical services and consumer information. All these services aim at providing maximum satisfaction to the customers, which is the key to marketing success in modern days. Customer support services prove very effective in bringing repeat sales from the customers and developing brand loyality for a product.

Advertising misleads customers :Yes, I agree as-

1. Advertising does not distinguish between superior and inferior products and with the help of advertising almost anything can be sold in the market.
2. Some manufacturers produce duplicates of certain products and through advertising they manage to persuade consumers to buy such dubious products.

Alternate Answer
No, I do not agree as-

1. Whether a product is inferior or superior depends upon the economic status and preference of the buyer.
2. Everyone cannot afford to buy high quality and superior products.

​​​​​​​Advertising increases the cost of the products.
Yes, I agree as-
Advertisement expenses are added to the cost and the consumer ultimately has to pay a higher price for the product or service.
Alternate Answer
No, I do not agree as-
Advertising increases demand which leads to an increase in sale. This leads to an increase in production. Companies, thus get advantages of economies of scale which reduce costs and therefore, lower prices. Thus the increase in costs due to advertisement gets compensated.

Factors that determine the choice of channels of distribution:

1. Product Related Factors: The important product related considerations in deciding the channels include whether the product is an industrial or a consumer product, whether it is a perishable or a non-perishable product, what is the unit value of the product and the degree of complexity of the product.
2. Company Characteristics: The important company characteristicsaffecting the choice of channels of distribution include the financial strength of the company and the degree of control it wants to hold on other channel members.
3. Competitive Factors: The choice of channel is also affected by the channel selected by competitors in the same industry. If the competitor’s have selected a particular channel say Chemist shops for the sale of toiletry products like hair oil, the other firm may also like to select the similar channel. In some cases producers may want to avoid the channels used by competitors.
4. Market Factors: Important market factors affecting the choice of channel of distribution include size of market, geographical concentration of potential buyers and quantity purchased. In case the number of buyers is small, like for most industrial products, short channels are used.
5. Environmental Factors: Other important factors affecting the choice of channels of distribution include environmental factor such as economic condition and legal constraints. In a depressed economy marketers use shorter channels to distribute their goods in an economical way.

Name of the technique is - Premium or giftsOther techniques of sales promotion are:

1. Rebate: Offering products at special prices, to clear off excess inventory. Example, a car manufacturer’s offer to sell a particular brand of car at a discount of Rs 10,000, for a limited period.
2. Discount: Offering products at less than list price. Example, a shoe company’s offer of ‘Discount Up to 50%’ or a shirt marketer’s offer of ‘50+40% Discount.
3. Refunds: Refunding a part of price paid by customer on some proof of purchase, say on return of empty foils or wrapper. This is commonly used by food product companies, to boost their sales.
4. Quantity Gift: Offering extra quantity of the product commonly used by marketer of toiletry products. For example, a shaving cream’s offer of ‘40% Extra’ or A Hotel’s offer of“Take a 2 Night 3 Days Package At the Hotel and Get an Extra Night Stay At Just Rs 500” or ‘Buy 2 Get 1 Free’ offer of a marketer of shirts.
5. Instant Draws and Assigned Gift: For example, ‘Scratch a Card’ or ‘Burst a Cracker’ and instantly win a Refrigerator, Car, T-shirt, Computer, with the purchase of a TV.
6. Lucky Draw: For example, the offer of a bathing soap to win a gold coin on lucky draw coupon for free petrol on purchase of certain quantity of petrol from given petrol pump or luckydraw coupon on purchase of easy undergarment and win a car offer.

Factors to be considered before taking a decision of a particular medium of advertising:

1. Class of the audience: Firstly, the advertiser must note the class of the audience to be influenced by the medium. The audience can be classified into different groups by their social status, age, income, educational standard, religion, cultural interests. They may also be divided into men and women
2. Extent of coverage: Secondly, the advertiser must consider the number of audience to be covered by the medium. Every media has a general as well as an effective circulation. The general circulation is made up of the total number of people who read or subscribe to the media. The effective circulation is the number prospective customers who read it and the number of those who influences sales, though they may not buy for themselves. Effective circulation must be considered while estimating the number of people to be covered. The extent to which the medium reaches the same audience as that covered by some other media i.e., the percentage of over-lapping must also be taken into account.
3. Nature of the product: Nature of the product itself is a principal factor governing the selection of the medium. Products can be classified into various kinds – consumer’s products and manufacturer’s products etc.
4. Nature of the competition: The nature of the competition exerts greater influence of the selection of the media. If the competition is stiff utmost care is needed in the selection of medium and a larger advertising budget is also required. In many cases where the advertising copy is similar or the choice of the media solely determines the effectiveness of the campaign as compared with that of the other competitors.
5. Reputation of the medium: Newspapers and magazines can offer a beautiful illustration for the reputation of the media. There are a few newspapers and magazines which have international reputation with a high readership. Advertisements in such magazines and newspapers are generally recognized and believed as true. Such advertisements also add prestige to the product.
6. Cost of the media: Cost of the medium in most cases, is an important factor in the selection of the medium. Advertisements in certain media are expensive. For instance, TV and Radio advertisements. Magazines and newspaper advertisements are generally considered as less expensive. Yet, certain magazines and newspapers, having larger circulation and high reputation charge higher rates. The rates also differ depending upon the space occupied and the preferential positions. The first page of a newspaper is rarely missed by the reader. Hence they have more attention value, than the advertisements presented anywhere inside the newspaper.
7. Time and location of buying decisions: The location of the audience and the time by which it should reach them must also be looked into. This consideration also enables the advertiser to keep his retail outlets in the proximity of the customers.