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F a c u l t y o f Ma n a g e me n t S t u d i e s , D e l h i

Marketing Guide for
Summer Placement

Contributed By
Batch of 2011 & 2012

Compiled By,
Sukesh Chandra Gain

1. Marketing vs Selling:
Marketing: Marketing is an integrated communications-based process through which
individuals and communities are informed or persuaded that existing and newly-identified
needs and wants may be satisfied by the products and services of others. Marketing creates the
atmosphere to make it easy for sales to happen. Eg. ITC launched Fiama.
Here are some marketing activities:
Handling incoming inquiries
Asking your current customers for referrals for more business
Networking and building relationships
Advertising and public relations. Direct mail and e-newsletters
Special promotional events
Merchandising and merchandise selection
Holding sales, offering preferred customer bonuses
Getting articles published. Blogging
Doing cold calls to set appointments
Market research, customer surveys
Branding, creating your sales message
Design and creation of collateral materials
Building and maintaining your web site, blog, Facebook page, Twitter
Market planning and strategizing
Selling: Selling includes the activities that get customers to make a purchase. Selling is closing
sales that make you money. Eg An insurance agent trying to sell insurance, a salesperson selling
encyclopedias door to door
A few things included in selling are: presenting, answering questions, making
suggestions, doing proposals or estimates, addressing concerns, negotiating. And most
important, asking for the sale. Then completing the sales agreement, etc

The Difference: The selling concept takes an inside-out perspective. It starts with the factory,
focuses on the companys existing products, and calls for heavy selling and promoting to
produce profitable sales. The marketing concept takes an outside-in perspective. It starts with a
well-defined market, focuses on customer needs, coordinates all the activities that will affect
customers, and produces profits through creating customer satisfaction.
Thus, you could say that:
Marketing is money OUT the door.
Selling is money IN the door.
A few major differences:
Marketing Selling
Customer focused Product focused
Product is designed as per customer needs Revenue is generated from the product sold.
Profit through customer satisfaction Profit through sales maximization
Emphasis on product planning and developing
as per customer needs
Emphasis on selling the already produced

2. STP

Segmentation is the process of grouping people or organizations within a market according to
similar needs, characteristics, or behaviour. Dividing the market into groups
an entire market rarely has the same tastes and preferences

Targeting is the actual selection of the segment you want to serve the target market is the
group of people or organizations whose needs a product is specifically designed to satisfy

Positioning is the use of marketing to enable people to form a mental image of your product in
their minds (relative to other products)
(Contributed by Sukesh Gain - 2012)

3. 4 Ps and 7 Ps
Marketing Mix

A tangible object or an intangible service that is mass produced or manufactured on a large
scale with a specific volume of units. Intangible products are often service based like the
tourism industry & the hotel industry or codes-based products like cellphone load and credits.
Typical examples of a mass produced tangible object are the motor car and the disposable razor.
A less obvious but ubiquitous mass produced service is a computer operating system.
Methods used to improve differentiate the product or increase sales or target sales more
effectively or to gain competitive advantage
- Extension Strategies
- New Editions
- Improvements
- Changed packaging
- Technology
- Specialized Versions
3 Levels of Product
For many a product is simply the tangible, phsysical entity that they may be buying or
selling. You buy a new car and that's the product - simple! Or maybe not. When you buy a
car, is the product more complex than you first thought? In order to actively explore the
nature of a product further, lets consider it as three different products - the CORE product,
the ACTUAL product, and finally the AUGMENTED product.

These are known as the 'Three Levels of a Product.' So what is the difference between the
three products, or more precisely 'levels?'

Three Levels of a Product

The CORE product is NOT the tangible, physical product. You can't touch it. That's because
the core product is the BENEFIT of the product that makes it valuable to you. So with the car
example, the benefit is convenience i.e. the ease at which you can go where you like, when
you want to. Another core benefit is speed since you can travel around relatively quickly.
The ACTUAL product is the tangible, physical product. You can get some use out of it. Again
with the car example, it is the vehicle that you test drive, buy and then collect.
The AUGMENTED product is the non-physical part of the product. It usually consists of lots
of added value, for which you may or may not pay a premium. So when you buy a car, part
of the augmented product would be the warranty, the customer service support offered by
the car's manufacture, and any after-sales service.

Product Life Cycle and Customer Life Cycle are also important tools for studying the product.


The price is the amount a customer pays for the product. It is determined by a number of
factors including market share, competition, material costs, product identity and the customer's
perceived value of the product. The business may increase or decrease the price of product if
other stores have the same product.
There are many ways to price a product. Let's have a look at some of them and try to
understand the best policy/strategy in various situations.
Premium Pricing.
Use a high price where there is a uniqueness about the product or service. This approach is used
where a a substantial competitive advantage exists. Such high prices are charge for luxuries such
as Cunard Cruises, Savoy Hotel rooms, and Concorde flights.
Penetration Pricing.
The price charged for products and services is set artificially low in order to gain market share.
Once this is achieved, the price is increased. This approach was used by France Telecom and Sky
Economy Pricing.
This is a no frills low price. The cost of marketing and manufacture are kept at a minimum.
Supermarkets often have economy brands for soups, spaghetti, etc.
Price Skimming.
Charge a high price because you have a substantial competitive advantage. However, the
advantage is not sustainable. The high price tends to attract new competitors into the market,
and the price inevitably falls due to increased supply. Manufacturers of digital watches used a
skimming approach in the 1970s. Once other manufacturers were tempted into the market and
the watches were produced at a lower unit cost, other marketing strategies and pricing
approaches are implemented.
Premium pricing, penetration pricing, economy pricing, and price skimming are the four main
pricing policies/strategies. They form the bases for the exercise. However there are other

important approaches to pricing.
Psychological Pricing.
This approach is used when the marketer wants the consumer to respond on an emotional,
rather than rational basis. For example 'price point perspective' 99 cents not one dollar.
Product Line Pricing.
Where there is a range of product or services the pricing reflect the benefits of parts of the
range. For example car washes. Basic wash could be $2, wash and wax $4, and the whole
package $6.
Optional Product Pricing.
Companies will attempt to increase the amount customer spend once they start to buy.
Optional 'extras' increase the overall price of the product or service. For example airlines will
charge for optional extras such as guaranteeing a window seat or reserving a row of seats next
to each other.
Captive Product Pricing
Where products have complements, companies will charge a premium price where the
consumer is captured. For example a razor manufacturer will charge a low price and recoup its
margin (and more) from the sale of the only design of blades which fit the razor.
Product Bundle Pricing.
Here sellers combine several products in the same package. This also serves to move old stock.
Videos and CDs are often sold using the bundle approach.
Promotional Pricing.
Pricing to promote a product is a very common application. There are many examples of
promotional pricing including approaches such as BOGOF (Buy One Get One Free).
Geographical Pricing.
Geographical pricing is evident where there are variations in price in different parts of the
world. For example rarity value, or where shipping costs increase price.
Value Pricing.
This approach is used where external factors such as recession or increased competition force
companies to provide 'value' products and services to retain sales e.g. value meals at
Cost Plus Cost-plus pricing is a pricing method used by companies. It is used primarily because
it is easy to calculate and requires little information. There are several varieties, but the
common thread in all of them is that one first calculates the cost of the product, then includes
an additional amount to represent profit. Cost-plus pricing is often used on government
contracts, and has been criticized as promoting wasteful expenditures.
The method determines the price of a product or service that uses direct costs, indirect costs,

and fixed costs whether related to the production and sale of the product or service or not.
These costs are converted to per unit costs for the product and then a predetermined
percentage of these costs is added to provide a profit margin.
Loss Leader Loss leader or leader is a product sold at a low price (at cost or below cost) to
stimulate other, profitable sales. It is a kind of sales promotion, in other words marketing
concentrating on a pricing strategy. The price can even be so low that the product is sold at a
loss. A loss leader is often a popular article. Sometimes leader is now used as a synonym for loss
leader and means any popular article, in other words one sold at a normal price


A channel of distribution comprises a set of institutions which perform all of the activities
utilised to move a product and its title from production to consumption.
Place is also known as channel, distribution, or intermediary. It is the mechanism through which
goods and/or services are moved from the manufacturer/ service provider to the user or
There are six basic 'channel' decisions:
Do we use direct or indirect channels? (e.g. 'direct' to a consumer, 'indirect' via a
Single or multiple channels.
Cumulative length of the multiple channels.
Types of intermediary.
Number of intermediaries at each level (e.g. how many retailers in Southern Spain).
Which companies as intermediaries to avoid 'intrachannel conflict' (i.e. infighting
between local distributors).

Selection Consideration - how do we decide upon a distributor?
Market segment - the distributor must be familiar with your target consumer and segment.

Changes during the product life cycle - different channels can be exploited at different points in
the PLC e.g. Foldaway scooters are now available everywhere. Once they were sold via a few
specific stores.
Producer - distributor fit - Is there a match between their polices, strategies, image, and yours?
Look for 'synergy'.
Qualification assessment - establish the experience and track record of your intermediary.
Training - How much training and support will your distributor require?

Another one of the 4P's is 'promotion'. This includes all of the tools available to the marketer for
'marketing communication'. As with Neil H.Borden's marketing mix, marketing communications
has its own 'promotions mix.' Think of it like a cake mix, the basic ingredients are always the
same. However if you vary the amounts of one of the ingredients, the final outcome is different.
It is the same with promotions. You can 'integrate' different aspects of the promotions mix to
deliver a unique campaign. The elements of the promotions mix are:
* Personal Selling.
* Sales Promotion.
* Public Relations.
* Direct Mail.
* Trade Fairs and Exhibitions.
* Advertising.
* Sponsorship.
The elements of the promotions mix are integrated to form a coherent campaign. As with all
forms of communication. The message from the marketer follows the 'communications process'
as illustrated above. For example, a radio advert is made for a car manufacturer. The car
manufacturer (sender) pays for a specific advert with contains a message specific to a target
audience (encoding). It is transmitted during a set of commercials from a radio station (Message

/ media).
The message is decoded by a car radio (decoding) and the target consumer interprets the
message (receiver). He or she might visit a dealership or seek further information from a web
site (Response). The consumer might buy a car or express an interest or dislike (feedback). This
information will inform future elements of an integrated promotional campaign. Perhaps a
direct mail campaign would push the consumer to the point of purchase. Noise represen
thousands of marketing communications that a consumer is exposed to everyday, all competing
for attention.

The Promotions Mix.

Let us look at the individual components of the promotions mix in more detail. Remember all of
the elements are 'integrated' to form a specific communications campaign.
1. Personal Selling.
Personal Selling is an effective way to manage personal customer relationships. The sales person
acts on behalf of the organization. They tend to be well trained in the approaches and
techniques of personal selling. However sales people are very expensive and should only be
used where there is a genuine return on investment. For example salesmen are often used to
sell cars or home improvements where the margin is high.
2. Sales Promotion.
Sales promotion tend to be thought of as being all promotions apart from advertising, personal
selling, and public relations. For example the BOGOF promotion, or Buy One Get One Free.
Others include couponing, money-off promotions, competitions, free accessories (such as free
blades with a new razor), introductory offers (such as buy digital TV and get free installation),
and so on. Each sales promotion should be carefully costed and compared with the next best
3. Public Relations (PR).
Public Relations is defined as 'the deliberate, planned and sustained effort to establish and
maintain mutual understanding between an organization and its publics' (Institute of Public
Relations). It is relatively cheap, but certainly not cheap. Successful strategies tend to be long-
term and plan for all eventualities. All airlines exploit PR; just watch what happens when there is
a disaster. The pre-planned PR machine clicks in very quickly with a very effective rehearsed
4. Direct Mail.
Direct mail is very highly focussed upon targeting consumers based upon a database. As with all
marketing, the potential consumer is 'defined' based upon a series of attributes and similarities.
Creative agencies work with marketers to design a highly focussed communication in the form
of a mailing. The mail is sent out to the potential consumers and responses are carefully
monitored. For example, if you are marketing medical text books, you would use a database of
doctors' surgeries as the basis of your mail shot.
5. Trade Fairs and Exhibitions.
Such approaches are very good for making new contacts and renewing old ones. Companies will
seldom sell much at such events. The purpose is to increase awareness and to encourage trial.
They offer the opportunity for companies to meet with both the trade and the consumer. Expo

has recently finish in Germany with the next one planned for Japan in 2005, despite a recent
decline in interest in such events.
6. Advertising.
Advertising is a 'paid for' communication. It is used to develop attitudes, create awareness, and
transmit information in order to gain a response from the target market. There are many
advertising 'media' such as newspapers (local, national, free, trade), magazines and journals,
television (local, national, terrestrial, satellite) cinema, outdoor advertising (such as posters, bus
7. Sponsorship.
Sponsorship is where an organization pays to be associated with a particular event, cause or
image. Companies will sponsor sports events such as the Olympics or Formula One. The
attributes of the event are then associated with the sponsoring organization.
The elements of the promotional mix are then integrated to form a unique, but coherent
Extended marketing mix
In the 1980s Booms and Bitner included three additional 'Ps' to accommodate trends towards a
service or knowledge based economy:
Physical Evidence
What is significant about services are the relative dominance of intangible attributes in the
make-up of the service product. Services are a special kind of product. They may require
special understanding and special marketing efforts. The need for the extension is due to the
high degree of direct contact between the providers and the customers, the highly visible
nature of the service process, and the simultaneity of the production and consumption. While it
is possible to discuss people, physical evidence and process within the original-Ps framework
(for example people can be considered part of the product offering) the extension allows a more
thorough analysis of the marketing ingredients necessary for successful services marketing.


People are the most important element of any service or experience. Services tend to be
produced and consumed at the same moment, and aspects of the customer experience are
altered to meet the 'individual needs' of the person consuming it. Most of us can think of a
situation where the personal service offered by individuals has made or tainted a tour, vacation
or restaurant meal. Remember, people buy from people that they like, so the attitude, skills and
appearance of all staff need to be first class. Some ways in which people add value to an
experience, as a part of the marketing mix are - training, personal selling and customer service.


Process is another element of the extended marketing mix, or 7P's.There are a number of
perceptions of the concept of process within the business and marketing literature. Some see
processes as a means to achieve an outcome, for example - to achieve a 30% market share a
company implements a marketing planning process.
Another view is that marketing has a number of processes that integrate together to create an
overall marketing process, for example - telemarketing and Internet marketing can be
integrated. A further view is that marketing processes are used to control the marketing mix, i.e.
processes that measure the achievement marketing objectives. All views are understandable,
but not particularly customer focused.

For the purposes of the marketing mix, process is an element of service that sees the customer
experiencing an organizations offering. It's best viewed as something that your customer
participates in at different points in time. Here are some examples to help your build a picture
of marketing process, from the customer's point of view.
Example - Going on a cruise - from the moment that you arrive at the dockside, you are greeted;
your baggage is taken to your room. You have two weeks of services from restaurants and
evening entertainment, to casinos and shopping. Finally, you arrive at your destination, and
your baggage is delivered to you. This is a highly focused marketing process.

Physical Evidence

Physical evidence is the material part of a service. Strictly speaking there are no physical
attributes to a service, so a consumer tends to rely on material cues. There are many examples
of physical evidence, including some of the following:
Internet/web pages.
Paperwork (such as invoices, tickets and despatch notes).
Signage (such as those on aircraft and vehicles).
Business cards.
The building itself (such as prestigious offices or scenic headquarters).

Mailboxes and many others .
A sporting event is packed full of physical evidence. Your tickets have your team's logos printed
on them, and players are wearing uniforms. The stadium itself could be impressive and have an
electrifying atmosphere. You travelled there and parked quickly nearby, and your seats are
comfortable and close to restrooms and store. All you need now is for your team to win!
Some organizations depend heavily upon physical evidence as a means of marketing
communications, for example tourism attractions and resorts (e.g. Disney World), parcel and
mail services (e.g. UPS trucks), and large banks and insurance companies (e.g. Lloyds of
(Contributed by 2011)

Product Decisions
The term "product" refers to tangible, physical products as well as services. Here are some
examples of the product decisions to be made:
>Product Variety >Quality > Design > Features > Brand name > Functionality > Styling >
Returns > Safety > Packaging > Repairs and Support > Warranty > Accessories and services >
Price Decisions
Some examples of pricing decisions to be made include:
> Pricing strategy (skim, penetration, etc.) > Suggested retail price/List price > Volume
discounts and wholesale pricing > Cash and early payment discounts > Allowances > Credit
Terms and Payment period > Seasonal pricing > Bundling > Price flexibility > Price
Distribution (Place) Decisions
Distribution is about getting the products to the customer. Some examples of distribution
decisions include:
> Distribution channels > Market coverage (inclusive, selective, or exclusive distribution) >
Assortments > Locations > Specific channel members > Inventory management >
Warehousing > Distribution centers > Order processing > Transportation > Reverse logistics
Promotion Decisions
In the context of the marketing mix, promotion represents the various aspects of marketing
communication, that is, the communication of information about the product with the goal of
generating a positive customer response. Marketing communication decisions include:
> Promotional strategy (push, pull, etc.) > Advertising > Personal selling & sales force > Sales
promotions > Public relations & publicity > Marketing communications budget > Direct

The 7-Ps or Extended Marketing Mix of Booms and Bitner is a Marketing Strategy tool that
expands the number of controllable variables from the four in the original Marketing Mix Model
to seven.
The Traditional Marketing Mix model was primarily directed and useful for tangible products.
The 7-Ps model is more useful for services industries and arguably also for knowledge-intensive

environments. The additional 3 Ps are:
An essential ingredient to any service provision is the use of appropriate staff and people.
Recruiting the right staff and training them appropriately in the delivery of their service is
essential if the organisation wants to obtain a form of competitive advantage. Consumers make
judgments and deliver perceptions of the service based on the employees they interact with.
Staff should have the appropriate interpersonal skills, aptititude, and service knowledge to
provide the service that consumers are paying for.
Refers to the systems used to assist the organisation in delivering the service. E.g at McDs u get
a burger in 2 min. What was the process that allowed you to obtain an efficient service delivery?
Banks that send out Credit Cards automatically when their customers old one has expired again
require an efficient process to identify expiry dates and renewal. An efficient service that
replaces old credit cards will foster consumer loyalty and confidence in the company.
Physical Evidence
Where is the service being delivered? Physical Evidence is the element of the service mix which
allows the consumer again to make judgments on the organisation. If you walk into a restaurant
your expectations are of a clean, friendly environment. On an aircraft if you travel first class you
expect enough room to be able to lay down!
Physical evidence is an essential ingredient of the service mix, consumers will make perceptions
based on their sight of the service provision which will have an impact on the organisations
perceptual plan of the service.
We must remember that the 4p/7p are from the sellers point of view. From the buyers point of
view we have:
Solution: How can I solve my problem?
Information: Where can I get information from?
Value: What is my total sacrifice to get the solution?
Access: Where can I find it?
In fact recently the 4 Cs of marketing have come up which along with the 4ps address a broad
range of marketing issues. You can read about them here:
(Contributed by Aastha Chawla - 2012)

4. Types of Entry Strategies, Specific Attack Strategies
Late arrivals
Early movers
Follow this link: Everything is mentioned.
5. Penetration Pricing and Price Skimming
Penetration pricing is the pricing technique of setting a relatively low initial entry price, often
lower than the eventual market price, to attract new customers. The strategy works on the
expectation that customers will switch to the new brand because of the lower price.

Penetration pricing is most commonly associated with a marketing objective of increasing
market share or sales volume, rather than to make profit in the short term
Suitable for elastic demand .
The advantages of penetration pricing
This can take the competition by surprise, not giving them time to react
It can create goodwill among the early adopters
Discourages the entry of competitors. Low prices act as a barrier to entry
Eg. Reliance mobile

Price skimming is a pricing strategy in which a marketer sets a relatively high price for a product
or service at first, then lowers the price over time
Price skimming is sometimes referred to as riding down the demand curve. The objective of a
price skimming strategy is to capture the consumer surplus. If this is done successfully, then
theoretically no customer will pay less for the product than the maximum they are willing to
pay. In practice, it is almost impossible for a firm to capture all of this surplus.
Examples: Playstation, DVDs, etc.
(Contributed by Nihar Sai Reddy 2012)

6. Promotion Mix
Marketers have at their disposal four major methods of promotion. Taken together these
comprise the promotion mix. In this section a basic definition of each method is offered while in
the next section a comparison of each method based on the characteristics of promotion is
Advertising Involves non-personal, mostly paid promotions often using mass media
outlets to deliver the marketers message. While historically advertising has involved one-
way communication with little feedback opportunity for the customer experiencing the
advertisement, the advent of computer technology and, in particular, the Internet has
increased the options that allow customers to provide quick feedback.
Sales Promotion Involves the use of special short-term techniques, often in the form of
incentives, to encourage customers to respond or undertake some activity. For instance,
the use of retail coupons with expiration dates requires customers to act while the
incentive is still valid.
Public Relations Also referred to as publicity, this type of promotion uses third-party
sources, and particularly the news media, to offer a favorable mention of the marketers
company or product without direct payment to the publisher of the information.
Personal Selling As the name implies, this form of promotion involves personal contact
between company representatives and those who have a role in purchase decisions (e.g.,
make the decision, such as consumers, or have an influence on a decision, such as
members of a company buying center). Often this occurs face-to-face or via telephone,
though newer technologies allow this to occur online via video conferencing or text chat.

7. Concept of Customer Derived Value
Marketing is about meeting the needs of your targeted market, but also providing them with a
value. This value is determined when subtracting the benefits a customer gets from the product
with the customer costs he does to get it.

8. Al Ries and Jack Z Trout on Positioning
A product's position is how potential buyers see the product. Positioning is expressed
relative to the position of competitors. The term was coined in 1969 by Al Ries and Jack Trout in
the paper "Positioning" is a game people play in todays me-too market place" in the publication
Industrial Marketing. It was then expanded into their ground-breaking first book, "Positioning:
The Battle for Your Mind".
Positioning is something (perception) that happens in the minds of the target market. It is the
aggregate perception the market has of a particular company, product or service in relation to
their perceptions of the competitors in the same category. It will happen whether or not a
company's management is proactive, reactive or passive about the on-going process of evolving
a position.
But a company can positively influence the perceptions through enlightened strategic actions.
In marketing, positioning has come to mean the process by which marketers try to create an
image or identity in the minds of their target market for its product, brand, or organization. It is
the 'relative competitive comparison' their product occupies in a given market as perceived by
the target market.
Re-positioning involves changing the identity of a product, relative to the identity of competing
products, in the collective minds of the target market.
De-positioning involves attempting to change the identity of competing products, relative to the
identity of your own product, in the collective minds of the target market.


The Process of Positioning
Generally, the product positioning process involves:
Defining the market in which the product or brand will compete (who the relevant
buyers are)
Identifying the attributes (also called dimensions) that define the product 'space'
Collecting information from a sample of customers about their perceptions of each
product on the relevant attributes
Determine each product's share of mind
Determine each product's current location in the product space
Determine the target market's preferred combination of attributes (referred to as an
ideal vector)
Examine the fit between:
o The position of your product
o The position of the ideal vector
The process is similar for positioning your company's services.
Services, however, don't have the physical attributes of products - that is, we can't feel them or
touch them or show nice product pictures.
So you need to ask first your customers and then yourself, what value do clients get from my
services? How are they better off from doing business with me? Also ask: is there a
characteristic that makes my services different?
Write out the value customers derive and the attributes your services offer to create the first
draft of your positioning.

9. BCG Matrix

Market share is the percentage of the total market that is being serviced by your company,
measured either in revenue terms or unit volume terms. The higher your market share, the
higher proportion of the market you control.
The Boston Matrix assumes that if you enjoy a high market share you will normally be making
money (this assumption is based on the idea that you will have been in the market long enough
to have learned how to be profitable, and will be enjoying scale economies that give you an
Market growth is used as a measure of a market's attractiveness. Markets experiencing high
growth are ones where the total market is expanding, which should provide the opportunity for
businesses to make more money, even if their market share remains stable.
Dogs: Low Market Share / Low Market Growth
In these areas, your market presence is weak, so it's going to take a lot of hard work to get
noticed. Also, you won't enjoy the scale economies of the larger players, so it's going to be
difficult to make a profit.
Cash Cows:
High Market Share / Low Market Growth
Here, you're well-established, so it's easy to get attention and exploit new opportunities.
Profits and cash generation should be high. Because of low growth investments needed shd be
low. Cash cows are stars of yesterday n the foundation of the company.
High Market Share / High Market Growth
Use large amounts of cash, they are the leaders in business so they should produce large

amounts of cash as well. These are fantastic opportunities, and you should work hard to realize
Question Marks (Problem Child):
Low Market Share / High Market Growth
These are the opportunities no one knows what to do with. They aren't generating much
revenue right now because you don't have a large market share. But, they are in high growth
markets so the potential to make money is there.

Question Marks might become Stars and eventual Cash Cows, but they could just as easily
absorb effort with little return. These opportunities need serious thought as to whether
increased investment is warranted.

Agri business

FMCGs and others



(Contributed by 2011)

10. Ansoff Matrix:
The Ansoff Product-Market Growth Matrix is a marketing tool created by Igor Ansoff
and first published in his article "Strategies for Diversification" in the Harvard Business Review
(1957). The matrix allows marketers to consider ways to grow the business via existing and/or
new products, in existing and/or new markets there are four possible product/market
Ansoff Matrix
Existing Products New Products

Market Penetration

Product Development


Market Development


Ansoff's matrix provides four different growth strategies:
Market Penetration - the firm seeks to achieve growth with existing products in their
current market segments, aiming to increase its market share.
Market Development - the firm seeks growth by targeting its existing products to new
market segments.
Product Development - the firms develops new products targeted to its existing market
Diversification - the firm grows by diversifying into new businesses by developing new
products for new markets.
The matrix illustrates, in particular, that the element of risk increases the further the strategy
moves away from known quantities - the existing product and the existing market. Thus,
product development (requiring, in effect, a new product) and market extension (a new market)
typically involve a greater risk than `penetration' (existing product and existing market); and
diversification (new product and new market) generally carries the greatest risk of all. In his
original work, which did not use the matrix form, Igor Ansoff stressed that the diversification
strategy stood apart from the other three.
While the latter are usually followed with the same technical, financial, and merchandising
resources which are used for the original product line, diversification usually requires new skills,
new techniques, and new facilities. As a result it almost invariably leads to physical and
organizational changes in the structure of the business which represent a distinct break with
past business experience. For this reason, most marketing activity revolves around penetration.
The market penetration strategy is the least risky since it leverages many of the firm's existing
resources and capabilities. In a growing market, simply maintaining market share will result in
growth, and there may exist opportunities to increase market share if competitors reach
capacity limits. However, market penetration has limits, and once the market approaches
saturation another strategy must be pursued if the firm is to continue to grow.
Market penetration
Market penetration is the name given to a growth strategy where the business focuses on
selling existing products into existing markets.
Market penetration seeks to achieve four main objectives:
Maintain or increase the market share of current products this can be achieved by a
combination of competitive pricing strategies, advertising, sales promotion and perhaps
more resources dedicated to personal selling
Secure dominance of growth markets
Restructure a mature market by driving out competitors; this would require a much
more aggressive promotional campaign, supported by a pricing strategy designed to
make the market unattractive for competitors
Increase usage by existing customers for example by introducing loyalty schemes
A market penetration marketing strategy is very much about business as usual. The
business is focusing on markets and products it knows well. It is likely to have good

information on competitors and on customer needs. It is unlikely, therefore, that this
strategy will require much investment in new market research.
Market development
Market development is the name given to a growth strategy where the business seeks to sell its
existing products into new markets.
There are many possible ways of approaching this strategy, including:
New geographical markets; for example exporting the product to a new country
New product dimensions or packaging: for example
New distribution channels
Different pricing policies to attract different customers or create new market segments
Product development
Product development is the name given to a growth strategy where a business aims to
introduce new products into existing markets. This strategy may require the development of
new competencies and requires the business to develop modified products which can appeal to
existing markets.
Diversification is the name given to the growth strategy where a business markets new products
in new markets. This is an inherently more risk strategy because the business is moving into
markets in which it has little or no experience. For a business to adopt a diversification strategy,
therefore, it must have a clear idea about what it expects to gain from the strategy and an
honest assessment of the risks.
Market penetration (existing markets, existing products): Market penetration occurs
when a company enters/penetrates a market with current products. The best way to
achieve this is by gaining competitors' customers (part of their market share). Other
ways include attracting non-users of your product or convincing current clients to use
more of your product/service, with advertising or other promotions. Market penetration
is the least risky way for a company to grow.
Product development (existing markets, new products): A firm with a market for its
current products might embark on a strategy of developing other products catering to
the same market (although these new products need not be new to the market; the
point is that the product is new to the company). For example, McDonald's is always
within the fast-food industry, but frequently markets new burgers. Frequently, when a
firm creates new products, it can gain new customers for these products. Hence, new
product development can be a crucial business development strategy for firms to stay
Market development (new markets, existing products): An established product in the
marketplace can be tweaked or targeted to a different customer segment, as a strategy
to earn more revenue for the firm. For example, Lucozade was first marketed for sick

children and then rebranded to target athletes. This is a good example of developing a
new market for an existing product. Again, the market need not be new in itself, the
point is that the market is new to the company.
Diversification (new markets, new products): Virgin Cola, Virgin Megastores, Virgin
Airlines, Virgin Telecommunications are examples of new products created by the Virgin
Group of UK, to leverage the Virgin brand. This resulted in the company entering new
markets where it had no presence before.
(Contributed by Aastha Chawla 2012; 2011)

11. Opportunity and Threat Matrix

12. McKinsey 7-S Framework

The McKinsey 7-S model was named after a consulting company, McKinsey and
Company. The McKinsey model is a model that describes 7 factors that determine how one can
holistically and effectively organize a company. It is basically a Value Based Management Model.
It consists of seven factors. Together these factors determine the way in which a corporation

The seven factors of McKinsey 7-S model are -
Shared values, originally termed superordinate goals, refers to the significant meanings
or guiding concepts that organisational members share---shared beliefs and attitudes---
what the org stands for and what it believes in
Structure is defined as the skeleton of the organisation or the organisational chart---the
way in which the organizations units relate to each other---centralized, functional
divisions (top down), decentralized, matrix etc
Strategy is the plan or course of action in allocating resources to achieve identified goals
over time---environment, competition, customers
Systems are the routine processes and procedures followed within the organisation---
financial systems, recruiting, promotion and performance appraisal systems, information
Staff is described in terms of personnel categories within the organisation
Skills variable refers to the capabilities of the staff within the organisation as a whole
Style is the way in which key managers behave in achieving organisational goals---
cultural style of the organisation

Advantages of using this framework
diagnostic tool for understanding organizations that are ineffective
guides organizational change
combines rational and hard elements with emotional and soft elements
managers must act on all Ss in parallel and all Ss are interrelated

It is basically used to audit companies based on the 7-Ss
For instance, if we want to study a company post merger we would do the following:
1) Assess the current situation for each of the 7-S for
2) Decide on what is the desired situation
3) Focus on strategy and business plan (costs, benefits, migration, communication, risks etc) to
go from step 1 to step 2

Trivia: The 7-S framework was first mentioned in the The Art of Japanese Mgmt by Richard
Pascale and Anthony Athos in 1981. They had been investigating how the Japanese industry had
been so successful. At around the same time Tom Peters and Robert Waterman were exploring
what made a company excellent. They all came up with the 7-S model in1978 and was taken up
as a basic tool by McKinsey
(Contributed by Rima Chakravarty - 2012)

13. B2B, B2C, C2C Marketing
Customer to Customer (C2C) MARKETING
Customer 2 Customer or the commonly used acronym C2C is a new marketing mantra
for Indian firms and the foreign multinationals.
Customer to Customer (C2C) markets are innovative ways to allow customers to interact with
each other. In customer to customer markets the business facilitates an environment where
customers can sell these goods and or services to each other. The quality of a product is vital for
the continued success of a business. A terrific marketing strategy might bring a customer to your

door, but if the product you deliver fails to satisfy, they will never return. And worse, the best
advertising of all, word-of-mouth, will turn against you.

Now let's define what is - Customer 2 Customer and Word Of Mouth.
Customer 2 Customer as defined by Philip Kotler:
"Customer 2 Customer includes all activities involving interaction between consumers.
Customer 2 Customer activities include auctions between consumers that are facilitated by
firms such as e-bay, personal, classified ads, ad games etc."

Word of Mouth as defined by Philip Kotler:
"Personal communication about a product between target buyers and neighbours, friends,
family members and associates."
Let's understand the real meaning of Customer 2 Customer and Word of Mouth through an
illustration. This illustration mainly focuses on the success behind Toyota Qualis.
Toyota Qualis is a car that has a tag of a taxi, than that of a personal or a private car. And one of
the sole reasons behind the huge volume of sales is its taxi tag. Now how did they get this taxi
tag? It all happened because of the word of mouth the best medium of advertisement. Private
taxis are the most roughly-driven cars and if these drivers swear by a car, then it's the best ad
for its reliability and toughness.
How were they able to win over these drivers? They won over them because they delighted
them. Delighted them means - they were able to provide delight to their customers by
understanding their specific personal interests, anticipating their needs, exceeding their
expectations, and making every moment and aspect of the relationship a pleasant - or better
yet, an exhilarating - experience.
This illustration proves only one aspect of Customer 2 Customer i.e. Word of mouth.
Now coming to the second aspect, i.e. C2C's role in consumer decision making:
Often we find that in a consumer decision process several individuals get involved. Each of them
plays an influencing role. At times, more than one role may be played by an individual. These
roles are:
1. Initiator
This is the person who sows the seed in a prospective customer's mind to buy the product. This
person may be a part of the customer's family like spouse or parents. Alternatively the person
may be a friend, a relative, a colleague or even the sales person.
2. Influencer
Influencer is a person within or outside the immediate family of the customer who influences
the decision process. The individual perceived as an influencer is also perceived as an expert. In
consumer durable sale the dealer plays an influencing role.
3. Decider
He is the person who actually takes the decision. In a joint family often it's the head of the
family or the elders in the family who take a decision. But in nuclear and single families and with

the increase in the literacy among women and number of working couples, one finds more
often than not, decisions are joint. Husband, wife and even the entire family taking the decision,
particularly on major purchases, is quite common in urban and metro areas. The decider/s
considers both economic and non-economic parameters before selecting a brand.
It is important to note that the people who play these roles seek different values in the
product or service. The perception of the value is to a large extent influenced by their prior
experience of others, media reports and the marketing cues created by the firm. These values,
which may also be referred to as, market value is the potential of a product or service to satisfy
customer's needs and wants.
The most common and widely used example of C2C marketing is Ebay. Ebay provides sellers a
platform to freely hawk their goods as well as interact with customers. These sellers themselves
are non-business individuals.
A real-life example is auctions, where sellers, who were initially customers themselves, sell
goods that they have bought to other individual customers.
Business to consumer (B2C) marketing
B2C marketing is one of the most popularly used strategies for effective market communication
and profitable business building. Business to consumer marketing is when a business markets
products to a consumer market. A consumer is a buyer of products that are not business
related. B2C products include goods and services such as food, clothes, cars, houses, phone
services, credit repair services, etc.
A B2C sale is to an individual. That individual may be influenced by other factors such as family
members or friends, but ultimately its a single person that pulls out their wallet.
B2C features a large target market, single step buying process and shorter sales cycle.
Repetition and imagery create its brand identity. B2C focuses on merchandising and point of
buying activities including coupons, displays and store fronts. Basically any business that offers
a retail product to the public comes under this type. In B2C markets, the brand encourages the
shopper to purchase, remain loyal and potentially pay a higher price.

It is one of the many marketing campaigns that business houses can use for publicizing their
goods and services. For this the company can hire people who can reach out to the general
public as company representatives. These representatives can address customers at public
places, such as shopping malls or districts and make them aware about companys products and
services by distributing flyers containing companys information or by handing over various
forms of promotional materials. The companys representatives also undertake door to door
marketing to promote company products or services. All these factors make B2C marketing one
of the most effective modes of communication. B2C marketing also involves advertising through
newspapers, television and radio for better communication. These modes provide the
companies with better consumer marketing strategies that can be worked upon to build a
bigger market for the products and services and thus achieve a profitable goal.

The B2C internet marketing is one of the most advanced consumer marketing strategies that
revolutionized the business world. It not only helps in developing a direct contact between the
consumer and business house but also allows the businessman to advertise and sell his

products and services in an easy manner.

Now a days with the advent of Internet, a businessman can make use of various online
advertising strategies which help to cater to wider section of potential market globally. Online
advertising strategies such as PPC and Podcast are counted among the most effective promotion
campaigning for any business. These advertisements can be displayed on various search sites so
that they are viewed by many people at the same time.

Making aware of companys offerings via websites also helps the business house to successfully
cater the potential audience. Also, the online shopping facility provided through the websites
make the customers in availing the facilities and buying the products without wasting any time
and extra money
to visit any physical store for making a desirable purchase.

It is not enough to just establish a business; the business should also flourish and produce
profit. To meet the objective, various strategies are used for good publicity. Among various
business market strategies, B2B marketing i.e. business to business marketing and B2C
marketing i.e. business to consumer marketing are being constantly talked about. A constant
debate over the two has created a B2B vs. B2C marketing situation in the business world.
Though the purpose of both is same i.e. business development and to generate profits but their
approaches are different. While B2B deals with transactions between two businesses, B2C
marketing strategy helps the business house in directly targeting the customers.
A family is at home on a Sunday night and is watching television. An advertisement
appears that advertises home delivered pizza. The family decides to order a pizza.
Walking down a supermarket aisle, a single man aged in his early 30's sees a hair care
product that claims to reduce dandruff. He pick's the product and adds it to his shopping
A pensioner visits her local shopping mall. She purchases a number of items including
her favourite brand of tea. She has bought the same brand of tea for the last 18 years.
Business-to-Business (B2B) Marketing
Business to Business marketing is the practice of individuals or organizations (commercial
businesses, governments and institutions) facilitating the sale of their products or services to
other companies or organizations that in turn resell them, use them as components in products
or services they offer, or use them to support their operations. This is also known as Industrial
In B2B, the customers can be:
1) Companies that consume products or services eg. automakers, who buy gauges to put in
their cars
2) government agencies this includes centre, state and local governments
3) institutions - schools, hospitals and nursing homes, churches and charities

4) resellers - wholesalers, brokers and industrial distributors
A B2B sale is to an organization. B2B describes commerce transactions between businesses,
such as between manufacturer and a wholesaler, or between a wholesaler and a retailer. The
volume of B2B transactions is much higher than the volume of B2C transactions. The main
reason is that in any supply chain, there will be many B2B transactions, e.g. involving
subcomponent or raw materials, and only on B2C transaction, i.e. the finished goods sale to
customer. B2B Marketing is driven purely on the basis of fewer, but larger, customers. It is very
necessary to be able to customize offering based on the buyers needs.
Some B2B Marketing Strategies:
B2B Branding Closely align corporate brands, divisional brands and product/service
brands and to apply brand standards to material often considered informal such as email
and other correspondence.
Product cost-saving or revenue-producing benefits of products/services should factor
throughout product development and marketing cycle.
People Usually, the target market for business products are smaller and have more
specialized needs. Thus, there can be multiple influencers on purchase decision, and
these need to be marketed to as well.
Pricing Business markets can pay premium prices if the pricing and payment terms are
structured well. This is particularly true in the case of a strong brand.
Promotion Specific trade shows, analysts, publications, blogs and retail/wholesale
outlets tend to be fairly common to each industry/product area. In essence, with proper
knowledge of your industry/product, the promo strategy almost writes itself.
Place -- The importance of a knowledgeable, experienced and effective direct (inside or
outside) sales force is often critical in the business market. If you sell through
distribution channels also, the number and type of sales forces can vary tremendously
and your success as a marketer is highly dependent on their success.

Business Marketing vs. Consumer Marketing
Although on the surface the differences between business and consumer marketing may seem
obvious, there are more subtle distinctions between the two with substantial ramifications.
Dwyer and Tanner (2006) note that business marketing generally entails shorter and more direct
channels of distribution.
While consumer marketing is aimed at large demographic groups through mass media and
retailers, the negotiation process between the buyer and seller is more personal in business
marketing. According to Hutt and Speh (2004), most business marketers commit only a small
part of their promotional budgets to advertising, and that is usually through direct mail efforts
and trade journals. While that advertising is limited, it often helps the business marketer set up
successful sales calls.
Marketing to a business trying to make a profit (Business-to-Business marketing) as opposed to
an individual for personal use (Business-to-Consumer, or B2C marketing) is similar in terms of

the fundamental principles of marketing. In B2C, B2B and B2G marketing situations, the
marketer must always:
successfully match the product/service strengths with the needs of a definable target
position and price to align the product/service with its market, often an intricate
balance; and
Communicate and sell it in the fashion that demonstrates its value effectively to the
target market.
(Contributed by Nazia Asad 2012; 2011)

14. Basics of Media Planning

15. Below the Line Initiatives (10 examples)
What is BTL, compare & contrast BTL with ATL?
BTL Below the Line. All advertising by means other than the five major media - the
press, television, radio, cinema and outdoors; below-the-line advertising employs a variety of
methods - direct mail, sponsorship, merchandising, trade shows, exhibitions, sales literature
and catalogues, and so on. Below the line promotions are becoming increasingly important
within the communications mix of many companies, not only those involved in FMCG products,
but also for industrial goods.

With the increasing pressure on the marketing team to achieve communication objectives more
efficiently in a limited budget, there has been a need to find out more effective and cost
efficient ways to communicate with the target markets. This has led to a shift from the regular
media based advertising.

Below the Line uses less conventional methods than the usual specific channels of advertising to
promote products, services, etc. than Above the Line strategies. These may include activities
such as direct mail, public relations and sales promotions for which a fee is agreed upon and
charged up front. Below the line advertising typically focuses on direct means of
communication, most commonly direct mail and e-mail, often using highly targeted lists of
names to maximize response rates.

Above the line is much more effective when the target group is very large and difficult to define.
But if the target group is limited and specific, it is always advisable to use BTL promotions for
efficiency and cost-effectiveness.

Most of the educational institutes like Career Launcher, Time and PT are holding
informative workshops and free tests for students which give a direct interaction of
these institutes with the target customer, and hence, a suitable platform to sell

Sales counters, beauty advisors, and dealer aids such as shade cards etc. LAKME
Search, email and online advertising
Price Promotion
o A discount to the normal selling price of a product, or
o More of the product at the normal price

(1) ING Vysya Bank also launched a social responsibility campaign, which started on the
Internet and moved to on-ground. It launched a website,, to educate
children about the importance of saving money and investing. Later, the initiative was taken to
underprivileged children in South India.

(2) ICICI Prudential Life Insurance recently launched a rural activation programme, called
Pragati Ki Anokhi Paathshala (PKAP), to inform the parents residing in the rural areas of the
country about how to plan their children's education better. Through the campaign, the
insurance player seeks to inform its target consumers about its education insurance plans.
(3) Dabur India ran a school activation campaign in 500 schools across 21 cities to look
for Super Champs, promising to pay their entire school fees for a year. The primary objective of
the activity is to create awareness and drive consumer engagement for Dabur Chyawanprash
and Dabur Chyawan Junior, a newly launched malted drink.
(4) HomeStop(of shoppers stop ), decided to launch its regular exchange offer scheme
under which customers can bring in their old furniture (which in turn will be donated to charity
by HomeStop) and avail of attractive discounts and offers on new furniture in return

(5) Most of the educational institutes like Career Launcher, Time and PT are holding
informative workshops and free tests for students which give a direct interaction of these
institutes with the target customer, and hence, a suitable platform to sell themselves.
(6) Pepsi organized an inter-school cricket event for 425 schools across 14 cities which did
wonders for the company by promoting the brand amongst the right target customer for almost
no cost.
(7) Another interesting BTL promotion was by NIKE, an athlete dressed up in Nike
sportswear could be seen jogging on an elevated treadmill for the whole day on National
Highway 8, Delhi.
(8) Most of the pharmacy companies do BTL promotion by getting shelf-space through
doctors to display their products or by giving away free calcium tablets again through doctors,
knowing that for a patient a personal advise from a doctor would hold more value as compared
to a commercial advertisement
(9) Media companies like Hindustan Times are holding weekly events throughout the
country in which companies can put up their stalls, display banners and posters, and arrange for
some fun activities.
(10) Ring-tones and music-videos on cell phones are helping the entertainment industry to
promote a music video or a movie for dirt-cheap rate as compared to media promotion
(11) The Dove Evolution Campaign
(12)Igen A cigarette brand was build through below the line marketing efforts. The brand
of cigarette was promoted through organizing parties for the BPO employees on weekly basis
and collecting their database and then making the cigarette available at their door steps, the
exercise was continued for quite a few months and a strong database and customer base was
developed for the brand among the BPO employees.
(13)The tea brand from Hindustan Unilever (HUL), Lipton, is riding on its Stay Sharp
proposition. The brand has taken an online jigsaw activity on-ground in Delhi. The activity is
being managed by Ogilvy Action, which had managed the on-ground promotions for the website
earlier. The Stay Sharp campaign conveys that Theanine (an ingredient present in Lipton Yellow
Label tea) helps clear minds and stay sharp and focused.
(14) (Example from the Non Traditional Marketing Workshop) The Scotch Brite Fountain

(15) The membership cards given by stores like Westside, Shoppers Stop, Lifestyle etc.,
which give a certain incentive on every purchase from the store.
(16) Max New York Life (MNYL) Insurance launched a 'Wheel of Fortune' game in all
Spencer's retail stores across Delhi to enhance its lead generation exercise
(17) Hewlett Packard (HP) created 'Experience Zones' in airports to promote its newly
launched Elite Books with corporates & executives
(18) Tata Tea, in a campaign for encouraging people to vote, centred its communication
round a website The site was used to get voter registrations through a
campaign that comprised a TV commercial, OOH and on-ground activation in colleges and
(19) GM's Chevrolet Spark organised a BTL activity 'Jeevan mein umang, Spark ke sang' to
promote the newly priced Spark in small towns & cities.
(20) CavinKare's Chic Shampoo too launched a school campaign 'Choo Lo Sitharon Ko' to
educate school going girls.
(21) In the media space, Sab TV, the comedy channel from MSM India, devised an interesting
route to reach media planners and buyers during the launch of Bhootwala Serial, India's first
horror comedy. Breaking the clutter, promoters dressed in scary ghostly costumes went across
all agencies like Zenith Optimedia, Lodestar, Lintas Media Group, Starcom, Madison, Maxus,
Mindshare and Mindshare Fulcrum.
(23) Nokia's Take Back campaign, an e-waste recycling programme. As part of this initiative,
Nokia will encourage people to dispose of mobile handsets in an ecologically friendly manner.
For this Nokia has set up recycling bins across its priority dealers & care centres.
(Contributed by 2011)

16. Brand Equity
A brand is a name or symbol used to identify the source of a product. When developing a new
product, branding is an important decision. The brand can add significant value when it is well
recognized and has positive associations in the mind of the consumer. This concept is referred to
as brand equity.
There are at least three perspectives from which to view brand equity:
Financial - One way to measure brand equity is to determine the price premium that a
brand commands over a generic product. For example, if consumers are willing to pay
$100 more for a branded television over the same unbranded television, this premium
provides important information about the value of the brand. However, expenses such
as promotional costs must be taken into account when using this method to measure
brand equity.
Brand extensions - A successful brand can be used as a platform to launch related
products. The benefits of brand extensions are the leveraging of existing brand
awareness thus reducing advertising expenditures, and a lower risk from the perspective
of the consumer. Furthermore, appropriate brand extensions can enhance the core
brand. However, the value of brand extensions is more difficult to quantify than are
direct financial measures of brand equity.
Consumer-based - A strong brand increases the consumer's attitude strength toward the
product associated with the brand. Attitude strength is built by experience with a
product. This importance of actual experience by the customer implies that trial samples
are more effective than advertising in the early stages of building a strong brand. The
consumer's awareness and associations lead to perceived quality, inferred attributes,
and eventually, brand loyalty.
Strong brand equity provides the following benefits:
Facilitates a more predictable income stream.
Increases cash flow by increasing market share, reducing promotional costs, and
allowing premium pricing.
Brand equity is an asset that can be sold or leased.
However, brand equity is not always positive in value. Some brands acquire a bad reputation
that results in negative brand equity. Negative brand equity can be measured by surveys in
which consumers indicate that a discount is needed to purchase the brand over a generic

Building and Managing Brand Equity
In his 1989 paper, Managing Brand Equity, Peter H. Farquhar outlined the following three stages
that are required in order to build a strong brand:
1. Introduction - introduce a quality product with the strategy of using the brand as a
platform from which to launch future products. A positive evaluation by the consumer is
2. Elaboration - make the brand easy to remember and develop repeat usage. There
should be accessible brand attitude, that is, the consumer should easily remember his or
her positive evaluation of the brand.
3. Fortification - the brand should carry a consistent image over time to reinforce its place
in the consumer's mind and develop a special relationship with the consumer. Brand
extensions can further fortify the brand, but only with related products having a
perceived fit in the mind of the consumer.
Alternative Means to Brand Equity
Building brand equity requires a significant effort, and some companies use alternative means
of achieving the benefits of a strong brand. For example, brand equity can be borrowed by
extending the brand name to a line of products in the same product category or even to other
categories. In some cases, especially when there is a perceptual connection between the
products, such extensions are successful. In other cases, the extensions are unsuccessful and
can dilute the original brand equity.
Brand equity also can be "bought" by licensing the use of a strong brand for a new product. As
in line extensions by the same company, the success of brand licensing is not guaranteed and
must be analyzed carefully for appropriateness.
Managing Multi Brands
Different companies have opted for different brand strategies for multiple products. These
strategies are:
Single brand identity - a separate brand for each product. For example, in laundry
detergents Procter & Gamble offers uniquely positioned brands such as Tide, Cheer,
Bold, etc.
Umbrella - all products under the same brand. For example, Sony offers many different
product categories under its brand.
Multi-brand categories - Different brands for different product categories. Campbell
Soup Company uses Campbell's for soups, Pepperidge Farm for baked goods, and V8 for

Family of names - Different brands having a common name stem. Nestle uses Nescafe,
Nesquik, and Nestea for beverages.
Brand equity is an important factor in multi-product branding strategies.

17. Brand Rituals (10 examples)
Brand ritual is the performance of an act by the consumers as defined by the brand
(Owners). These days brand rituals are a common strategy adopted by marketers. Some rituals
become a part of our behavior over time. Few examples are as follows:
1. Close up:- The HA-HA thing which we do by holding our palm in front of our mouth to
check the fresh breath
2. Kitkat:- Push the chocolate out of the paper wrap. Pull your thumb across the lines
between the chocolate bars. Break it. Unwrap and eat...
3. Pepsi My can:- The way they hold the can in the ads to ask the viewers to do the same...
4. Tequila Shots:- The trademark way of consuming tequila.
5. Bru Cappuccino:- Sip, Lick... Ummm..!! Denoted how to enjoy the cool drink and the
coffee froth.
6. Wrigley's Chiklets:- Shake the box of chewing gums 2 make that chik-chik noise
7. Boomer:- the bubble that everyone started making while chewing the gum.
8. Corona Beer:- Consume the beer with a slice of lemon
9. Horlicks:- Epang Opang Jhapang. Try and make a chocolate shake with Horlicks by using
their freebie and this technique.
10. Fair & Lovely:- One of the ads showed the viewers to apply the cream on the face and
massage it in the shape of eight.
(Contributed by 2011)

18. Brand Rivalry (10 examples)
1. (Heinz)Complan vs (GSK)Horlicks
Complan has never been an aggressive player compared to the market leader Horlicks . This
explains the reason why such a powerful brand is languishing in a distant position of 15%
market share compared to the 60 % share of Horlicks.
While Horlicks has been breaking new grounds with a series of variants aiming at the
entire family segment, Complan was lying low all these years. The major happening for this
brand in 2008 was the launch of the new flavor Kesari Badam . In the promotional front, the
brand was in a low key mode continuing with the extension of its earlier campaign focusing on
EXTRA growth.
2. (Nestle) Munch vs (Cadbury) Dairy Milk
Fighting with advertisements is not new in the Indian consumer market. First we saw two cola
companies making ads against each others, then came two hot beverage products doing this
and now its the turn for the chocolates - Dairy Milk vs Nestle Munch.
3. (Coca Cola) Sprite vs (Pepsi) Mountain Dew
Sprite came up with an ad hitting on mountain dews jingle.
4. Pepsi vs Coca Cola - Pepsi's 'Nothing Official About It' campaign in World Cup 96 after Coca
Cola became the official sponsor. One of its effects was the stringent anti-ambush marketing
laws that cricketers had to sign in 2002
5. Nestle Munch v/s Cadbury Dairy Milk: Cadbury as it always comes up with ads showing new
reasons to celebrate, by showing in the retro style people celebrating their payment on the 1st
day of month through Dairy Milk. Nestle Munch which is the biggest rival of dairy Milk hit it with
an ad campaign showing that Munch can be eaten on any day & there needn't be any specific
day for which it should wait.
6. Kotex v/s whisper: Whisper has the highest market share in the product segment & Kotex
attacking the no. 1 brand came up with the ad campaign which showed, don't whisper be loud.
This was to directly attack the Whisper Brand.
7. HUL v/s Eureka Forbes: Eureka Forbes making mockery of the Pureit Mascot, ie the guy in the
yellow raincoat. There is a case filed by HUL regarding the same in the high court.
Other rivalries are-
Sony vs Nintendo
Huggies vs Pampers
Energizer vs Duracell
Mcdonalds vs Burger King USA
CCD vs barista
Ford vs GM
BMW vs Mercedes Benz
(Contributed by 2011)

19. Buyer Decision Process
Research suggests that customers go through a five-stage decision-making process in any
purchase. This is summarized in the diagram below:

This model is important for anyone making marketing decisions. It forces the marketer to
consider the whole buying process rather than just the purchase decision (when it may be too
late for a business to influence the choice!)
The model implies that customers pass through all stages in every purchase. However, in more
routine purchases, customers often skip or reverse some of the stages.
For example, a student buying a favorite hamburger would recognize the need (hunger) and go
right to the purchase decision, skipping information search and evaluation. However, the model
is very useful when it comes to understanding any purchase that requires some thought and
The buying process starts with need recognition. At this stage, the buyer recognizes a problem
or need (e.g. I am hungry, we need a new sofa, I have a headache) or responds to a marketing
stimulus (e.g. you pass Starbucks and are attracted by the aroma of coffee and chocolate
An aroused customer then needs to decide how much information (if any) is required. If the
need is strong and there is a product or service that meets the need close to hand, then a
purchase decision is likely to be made there and then. If not, then the process of information
search begins.
A customer can obtain information from several sources:
Personal sources: family, friends, neighbors etc
Commercial sources: advertising; salespeople; retailers; dealers; packaging; point-of-sale
Public sources: newspapers, radio, television, consumer organizations; specialist magazines
Experiential sources: handling, examining, using the product
The usefulness and influence of these sources of information will vary by product and by
customer. Research suggests that customers value and respect personal sources more than
commercial sources (the influence of word of mouth). The challenge for the marketing team is
to identify which information sources are most influential in their target markets.
In the evaluation stage, the customer must choose between the alternative brands, products
and services.
How does the customer use the information obtained?
An important determinant of the extent of evaluation is whether the customer feels involved
in the product. By involvement, we mean the degree of perceived relevance and personal
importance that accompanies the choice.
Where a purchase is highly involving, the customer is likely to carry out extensive evaluation.
High-involvement purchases include those involving high expenditure or personal risk for
example buying a house, a car or making investments.
Low involvement purchases (e.g. buying a soft drink, choosing some breakfast cereals in the
supermarket) have very simple evaluation processes.
Why should a marketer need to understand the customer evaluation process?
The answer lies in the kind of information that the marketing team needs to provide customers

in different buying situations.
In high-involvement decisions, the marketer needs to provide a good deal of information about
the positive consequences of buying. The sales force may need to stress the important
attributes of the product, the advantages compared with the competition; and maybe even
encourage trial or sampling of the product in the hope of securing the sale.
Post-purchase evaluation - Cognitive Dissonance
The final stage is the post-purchase evaluation of the decision. It is common for customers to
experience concerns after making a purchase decision. This arises from a concept that is known
as cognitive dissonance. The customer, having bought a product, may feel that an alternative
would have been preferable. In these circumstances that customer will not repurchase
immediately, but is likely to switch brands next time.
To manage the post-purchase stage, it is the job of the marketing team to persuade the
potential customer that the product will satisfy his or her needs. Then after having made a
purchase, the customer should be encouraged that he or she has made the right decision.
(Contributed by 2011)

20. Cause related marketing
Cause marketing or cause-related marketing refers to a type of marketing involving the
cooperative efforts of a "for profit" business and a non-profit organization for mutual benefit.
The term is sometimes used more broadly and generally to refer to any type of marketing effort
for social and other charitable causes, including in-house marketing efforts by non-profit
organizations. Cause marketing differs from corporate giving (philanthropy) as the latter
generally involves a specific donation that is tax deductible, while cause marketing is a
marketing relationship generally not based on a donation.
The creation of the term "cause-related marketing" is attributed to American Express, and it was
coined to describe efforts to support locally based charitable causes in a way that also promoted
business. The term was then used to describe the marketing campaign led by American Express
in 1983 for the Statue of Liberty Restoration project.[6] A penny for each use of the American
Express card, and a dollar for each new card issued was given to the Statue of Liberty renovation
program. Over a four-month period, $2 million was raised for Lady Liberty, transaction activity
jumped 28 percent and the concept that doing good was good for business, was born.
Attracting and Retaining Customers: Companies that have engaged in Cause Related
Marketing report that those efforts help attract and build long- term relationships with
customer. For Example, affinity credit cards, in which a nonprofit organization benefits each
time a consumer, uses the card to make a purchase, help credit card companies develop
longterm relationships with consumers.
Market Differentiation: For many companies, Cause- Related Marketing has helped them to
create an alternative and distinctive approach to brand advertising. CRM can help companies
distinguish themselves from their peers by offering the consumer the opportunity to contribute
to something more then the companys bottom line. National and International brands can
better identify with their local markets by linking themselves with community organizations, or
with regional or nongovernmental organizations.

Out reach to Niche Markets: Partnering with nonprofit organizations can help a company to
connect with specific demographic or geographic markets. For Example, Ford Motor Company
successfully positioned itself among a formerly disengaged target market Women. In addition
to its Substantial financial and in kind donations to Race events, The Ford Division of the Ford
Motor Company has issued thousands of public service announcements in an effort to both
communicate a critical health message to women and to enfold them into its brand identity.
(Cause Related Marketing A Conceptual Paradigm)
Examples in Indian context:
1. Tata Salt, the pioneers and undisputed leaders in the packaged and iodized Salt Category,
reiterated its commitment to the cause of educating underprivileged children and
announced its Desh Ko Arpan Programme. The Desh Ko Arpan Programme, Tata
Chemicals Limited Contributes 10 paise for every kilo of Tata Salt, sold during specific
periods, to the education of underprivileged children. Child Relief and You (CRY) has
been chosen as partners. The money raised was Rs 33 lakhs in a period of one month.
The money raised will support six child development initiatives across the country,
Lok Shakti Vikas Sansthan, Barmer, Rajasthan
Jabala, Kolkata, West Bengal
The Good Shepherd Society, Chennai, Tamil Nadu
Gramya, Nalgonda, Andhra Pradesh
The community Services Guild, Namakkal, Tamilnadu
Rachana Society for Social Reconstruction, Pune Maharashtra.
2. P&Gs Shikha campaign
Every time you choose to buy a large pack of Tide, Ariel, Pantene, H&S, Rejoice, Vicks VapoRub,
Whisper, Gillette Mach 3 Turbo, Gillette series, Oral B, Duracell or Pampers, P&G promises to
contribute are helping thousands of underprivileged children across India to access their right
to education. Minimum contribution from P&G to Shiksha, irrespective of sales will be Rs. 1
Shiksha enabled the education of 33052 children in 435 communities in 2006
More info:
(Contributed by Nupur Jain - 2012)

21. Customer relationship management
Main aim: customer retention and customer satisfaction

We have to make list of the customers, these serve as the target lists.
Strategy should be:
Save money by not marketing to those who are less likely to respond.
Make money by making relevant offers to those who need, or want or can afford or
We build relationship with our best customers, resulting in higher loyalty, retention,
referral, spending rate and profits
It is a process or methodology used to learn more about customers' needs and behaviours in
order to develop stronger relationships with them. CRM helps businesses use technology and
human resources to gain insight into the behaviour of customers and the value of those
According to industry view, CRM consists of:
Helping an enterprise to enable its marketing departments to identify and target
their best customers, manage marketing campaigns and generate quality leads for
the sales team.

Assisting the organization to improve telesales, account, and sales management by
optimizing information shared by multiple employees, and streamlining existing
processes (for example, taking orders using mobile devices)
Allowing the formation of individualized relationships with customers, with the aim
of improving customer satisfaction and maximizing profits; identifying the most
profitable customers and providing them the highest level of service.
Providing employees with the information and processes necessary to know their
customers, understand and identify customer needs and effectively build
relationships between the company, its customer base, and distribution partners.
(Contributed by Venkat Sujit Samrat 2012; 2011)

22. Customer relationship Marketing
Customer Relationship Marketing (Basics)
Focuses on retaining existing Customers to create long-term value to the firm
DOES NOT FOCUS on targeting new customers/acquisition of new clients
It costs four-to-six times more to convert a customer than it does to retain one
Directly linked to enhancing the levels of Customer Satisfaction
It can be applied when there are competitive product alternatives for customers to
choose from and also when there is an ongoing & periodic desire for the product or
Primary Objectives:
o Reduce Customer Turn-over/ Increase Customer Retention
o Increase Customer Loyalty
o Increase Customer Satisfaction
o Increasing switching barriers (especially when there are many competitors
offering similar products/services)
It relies upon the communication and acquisition of consumer requirements solely from
existing customers in a mutually beneficial exchange so as to create value.
Usually facilitated by Customer Relationship Management systems (software systems
that facilitate tracking and analyzing customer's preferences purchasing behavior,
activities, tastes, likes, dislikes, and complaints, etc.)

It is empirically proven that a 5% improvement in customer retention can cause an
increase in profitability of between 25 and 85 percent.
One of the advantages of retaining customers is that these long-term customers may
initiate free word of mouth promotions and referrals, which is one of the most cost-
effective campaigns that a product can get.
Customers that stay with you tend to be satisfied with the relationship and are less likely
to switch to competitors, making it difficult for competitors to enter the market or gain
market share.
Customer retention efforts involve considerations such as the following:
1. Customer valuation - describes how to value customers and categorize them
according to their financial and strategic value so that companies can decide where
to invest for deeper relationships and which relationships need to be served
differently or even terminated.
2. Customer retention measurement - This is simply the percentage of customers at
the beginning of the year that are still customers by the end of the year. In
accordance with this statistic, an increase in retention rate from 80% to 90% is
associated with a doubling of the average life of a customer relationship from 5 to 10
years. This ratio can be used to make comparisons between products, between
market segments, and over time.
3. Determine reasons for defection - Look for the root causes, not mere symptoms.
This involves probing for details when talking to former customers. Other techniques
include the analysis of customers' complaints and competitive benchmarking.
4. Develop and implement a corrective plan - This could involve actions to improve
employee practices, using benchmarking to determine best corrective practices,
visible endorsement of top management, adjustments to the company's reward and
recognition systems, and the use of "recovery teams" to eliminate the causes of
(Contributed 2011)

23. Different Pricing Strategies
The pricing strategy for a new product should be developed so that the desired impact on
the market is achieved while the emergence of competition is discouraged. Pricing strategies are
as many as there are market scenarios. Thus, it is best to start defining the most commonly used
strategies, illustrated with examples where they can be found.
1. Penetration pricing: Price set to penetrate the market

Low price to secure high volumes
Typical in mass market products chocolate bars, food stuffs, household goods, etc.
Suitable for products with long anticipated life cycles
May be useful if launching into a new market
Eg. Reliance mobile
2. Market Skimming :
High price, Low volumes
Skim the profit from the market
Suitable for products that have short life cycles or which will face competition at some
point in the future (e.g. after a patent runs out)
Examples: Playstation, DVDs, etc.
1. Value pricing:
Price set in accordance with customer perceptions about the value of the product/service
Eg. bottled water like Bisleri, Skin care products like Olay
2. Loss leader:
Goods/services deliberately sold below cost to encourage sales elsewhere
Typical in supermarkets, e.g. at Christmas, selling bottles of gin at 3 in the hope that
people will be attracted to the store and buy other things
Purchases of other items more than covers loss on item sold
Example: Free mobile phone when taking on contract package, modem along with
internet connection.
3. Psychology pricing:
Used to play on consumer perceptions
Classic example Rs 999 instead of Rs 1000!
Links with value pricing high value goods priced according to what consumers THINK
should be the price
Example: dollar store (everything is priced at Rs99)
4. Going Rate (Price Leadership):
In case of price leader, rivals have difficulty in competing on price
too high: they lose market share,
too low: the price leader would match price and force smaller rival out of market
May follow pricing leads of rivals especially where those rivals have a clear dominance of
market share
Where competition is limited, going rate pricing may be applicable
eg banks, petrol, supermarkets, electrical goods find very similar prices in all outlets
5. Tender Pricing:
Many contracts awarded on a tender basis
Firm (or firms) submit their price for carrying out the work
Purchaser then chooses which represents best value
Mostly done in secret
Eg. Defence vehicle contracts, Delhi Metro Rail project
6. Price Discrimination:
Charging a different price for the same good/service in different markets

Requires each market to be impenetrable
Requires different price elasticity of demand in each market
Eg: Airlines, dell (online & store prices diff for the same model)

7. Destroyer/Predatory Pricing:
Deliberate price cutting or offer of free gifts/products to force rivals (normally smaller
and weaker) out of business or prevent new entrants
Anti-competitive and illegal if it can be proved
Eg: Rs 500 mobile phone by Reliance
8. Absorption/Full Cost Pricing:
Full Cost Pricing attempting to set price to cover both fixed and variable costs
Absorption Cost Pricing Price set to absorb some of the fixed costs of production
Eg. Autocomponents ( fixed cost of tools+ variable material cost)
9. Marginal Cost Pricing:
Marginal cost the cost of producing ONE extra or ONE fewer item of production
MC pricing allows flexibility
Particularly relevant in transport where fixed costs may be relatively high
Allows variable pricing structure e.g. on a flight from London to New York providing
the cost of the extra passenger is covered, the price could be varied a good deal to attract
customers and fill the aircraft
10. Contribution Pricing:
Contribution = Selling Price Variable (direct costs)
Prices set to ensure coverage of variable costs and a contribution to the fixed costs
Similar in principle to marginal cost pricing
Break-even analysis might be useful in such circumstances

11. Target Pricing:
Setting price to target a specified profit level
Estimates of the cost and potential revenue at different prices, and thus the break-even
have to be made, to determine the mark-up
Mark-up = Profit/Cost x 100
Eg. Real Estate
12. Cost-Plus Pricing:
Calculation of the average cost (AC) plus a mark up
AC = Total Cost/Output
(Contributed by 2011)

24. Positioning & Differentiation
Positioning is the act of designing the companys offering and image to occupy a
distinctive place in the minds of the target market. A good brand positioning strategy will lead
to clarifying the brands essence, the goals it helps consumers achieve and it does it in a unique

way. Positioning requires the marketer to clearly communicate the similarities and differences
between brands. Determining a positioning strategy requires establishing a frame of reference
by identifying the target market and the competition and identifying the ideal points of parity
and points of difference brand associations.
Frame of reference is the framework used by the consumers to make sense of the product in
question. Humans understand and remember new things by linking it to existing (known)
objects. Frame of reference is that evaluative criterion which is used by consumers to make a
better understanding of the product/services. Frame of reference also explains the context in
which consumers tend to evaluate /place the product. For example, the frame of reference used
to evaluate Frooti is that it is a mango drink. Coca Cola = Cola, Ace = Mini Truck, Dettol =
Antiseptic etc. If Frooti launches an Apple Drink, the consumers will find it difficult to accept the
product since it is out of the frame of reference used to evaluate/understand Frooti.
Since consumers use a frame of reference in understanding a product, the concept has a very
important place in the positioning of the product. Once the frame of reference is identified, the
marketer will position the product in line with the frame of reference. In case of products that
lack a frame of reference, marketers should create a frame of reference for the consumers.
The concept of Points of Parity helps marketers to place the product in line with the consumer's
frame of reference. Points of parity are those associations that are not necessarily unique to the
brand but may in fact be shared with other brands. There are two forms of Points of Parity -
Category POP and Competitive POP. Category POPs are those associations that consumers view
as being necessary to be a legitimate and credible offering with a certain product or service
category. Competitive POP are those associations designed to negate competitor's Points of
Parity. For example, hand sanitizer is a new category and consumers are not aware of such a
category. So when a brand is being launched in such a new category, brand managers should
first establish a category POP. For that, the consumers should be made aware of such a category.
Right now marketers are using infomercials to educate the consumers about hand sanitizer, its
advantages and uses. Once the frame of reference is established, then the brand should be
placed in the category. Usually marketers use packaging, product form and labels to establish
category points of parity.
Competitor POP is where marketers tell the consumers that their brand have all the
properties/qualities of their competing brands. For example Lifebuoy soap will establish
competitive POP with Dettol soap by claiming that it has germ killing qualities and vice versa.
These strategies will fail if the marketers did not understand the frame of reference used by
consumers in evaluating the product. This lack of understanding can lead to positioning failures
that eventually lead to product failure.
Some examples of positioning:
Dominoes Hot pizza delivered within 30 mins
Monaco smart chips healthy snack
Lays - convenient snack,
Bingo - different tastes
Aliva - health + taste
Hippo is being positioned as a hunger- killer. The brand wants to be a guilt-free snack for hunger
Interesting ad positioning hippo
The market is flooded with similar products and offerings which has created a huge clutter of
brands and products. It is essential for a marketer to be able to differentiate his product to
break through the clutter. Differentiation based on product features has become a difficult task
with competitors taking no time in copying /adopting that feature. Differentiations based on
incremental product improvements /features have become difficult to develop and sustain in
the market.
Methods of differentiation:
1) Invest in R&D
India is an R&D and product development hub for most of the MNCs but seldom Indian
marketers were able to create breakthrough products for the Indian market. Tata Nano has
shown the world what Indian minds can do when inspired. The market is moving in a direction
where only those brands will succeed who can innovate.
2) Protect the Differentiation
An important determinant of a successful differentiation is the brands ability to protect the
differentiation. Smart brands use ingredient branding to protect their key differentiators.
Ingredient branding is where a particular product feature or an ingredient is branded by the
company. There are two kinds of ingredient brands.
a) Where the ingredient is owned by another company. Intel is a pioneer in ingredient branding.
Intel has built ingredient brands like Pentium, Celeron and Atom etc.
b) Where the feature/ingredient is owned by the company itself. Bajaj has a powerful ingredient
brand DTSI (which is also a patented technology) which it now uses for all of its two wheeler
3) Connect to a Relevant Need
Creating a sustainable differentiation is possible only when brands become customer focused.
When products become standardized, it is important for marketers to create differentiation
focusing on consumer needs.

Brand laddering is a strategy that can be used by marketers to create differentiation on a need
rather than on a product feature (attribute to value). Raymond is a brand that has created a
space for itself by effectively laddering up to a customer need (Complete Man). The benefit of
such a strategy is that competitors will find it difficult to copy the differentiation since it is based
on an intangible attribute. The brand has created a unique powerful image which is sustainable
over time.
4) Long Term Vision through Brand Charter
It is important for marketers to create a brand charter which will spell out the long term vision
for the brands, its differentiation and positioning platforms, guidelines and strategies.
Such a brand charter will guide the future brand managers to create tactics which are in line
with the overall brand vision. If a brand chose to create intangible differentiation opportunities,
there has to be a consistency in the brands positioning and differentiation strategies. Brand
Charter will help bring consistency which will in turn facilitate create a sustainable
Types of Differentiation:
Personnel Differentiation: By using better trained employees. Singapore airlines are well
regarded because of its flight attendants.
Channel Differentiation: By efficiently and effectively designing distribution channels coverage,
expertise and performance. Eureka Forbes water purifiers and vacuum cleaners gained
popularity due to their differentiated positioning through their direct to home channel.
The Himalaya drug company differentiates itself by using ayurvedic ingredients.

Product Positioning: - In marketing, positioning has come to mean the process by which
marketers try to create an image or identity in the minds of their target market for its product,
brand, or organization. It is the 'relative competitive comparison' their product occupies in a
given market as perceived by the target market.
Positioning means determining and communicating the central benefit of the product in the
minds of target buyers. For example, a car manufacturer might target buyers for whom safety is
a major concern. The company "positions" its cars as the safest vehicles that customers can buy.
Positioning starts with a product. A piece of merchandise, a service, a company, an institution,
or even a person. But positioning is not what you do to a product. Positioning is what you do to
the mind of the prospect. That is, you position the product in the mind of the prospect. Brands
usually position themselves using certain parameters. These parameters highlight the most
relevant features of its product and the image, the brands wishes to portray to its consumers.
How to write a positioning statement:-
For [target end user]

Who wants/needs [compelling reason to buy]
The [product name] is a [product category]
That provides [key benefit].
Unlike [main competitor],
The [product name] [key differentiation]

Product differentiation:- Differentiation is the act of distinguishing your company's offering
from competitors' offerings in ways that are meaningful to consumers. You can differentiate
products physically or through the services your company provides in support of the product.
In business terms, to differentiate means to create a benefit that customers perceive as being of
greater value to them than what they can get elsewhere. It's not enough for you to be different-
-a potential customer has to take note of the difference and must feel that the difference
somehow fits their need better. (Other words that mean virtually the same thing: Competitive
Advantage; Unique Selling Proposition; or Value Proposition.)
Products' physical distinctions include:
formsize, shape, physical structure; for example, aspirin coating and dosage
featuressuch as a word processing software's new text-editing tool
performance qualitythe level at which the product's primary characteristics function
conformance qualitythe degree to which all the units of the product perform equally
durabilitythe product's expected operating life under natural or stressful conditions
reliabilitythe probability that the product won't malfunction or fail
reparabilitythe ease with which the product can be fixed if it malfunctions
stylethe product's look and feel
designthe way all the above qualities work together; (it's easy to use, looks nice, and
lasts a long time)
Products' service distinctions include:
ordering easehow easy it is for customers to buy the product
deliveryhow quickly and accurately the product is delivered
installationhow well the work is done to make the product useable in its
intended location
customer trainingwhether your company offers to train customers in using the

customer consultingwhether your company offers advising or research
services to buyers of the product
maintenance and repairhow well your company helps customers keep the
product in good working order
Keys to Successful Differentiation:
Know your customers, really, really well.
Pick a blend of differentiation methods that, in the eyes of your customers, truly sets you
Talk about your differentiation in terms of customer benefits.
Tell everyone about what differentiates you--often.
Keep your differentiation fresh by listening for changing customer needs.
(Contributed by Malvika Oli - 2012; 2011)

25. Digital Marketing /Online Marketing
Digital Marketing is the practice of promoting products and services using digital
distribution channels to reach consumers in a personal and cost-effective manner. Media
o Banner Ad: An advertisement that appears on a Web page, most commonly at
the top (header) or bottom (footer) of the page. Designed to have the user click
on it for more information.
o Blog: blog is a user-generated Web site where entries are made in journal style
and displayed in a reverse chronological order
o Brand and consumer interaction through social web and brands own website
o Microsite: A mini Web site design to promote a specific portion or brand from a
larger corporate site. Used often with contests or as a landing page for a specific

o RSS or Real Simple Syndication is technology designed to allow users to subscribe
to a specific content feed and be automatically alerted when new updates are

o Personalised E-mails to subscribers of companys newsletters etc/ potential
Mobile Phones
o SMS (Short Message Service) is a one-way text message sent via a cell phone.
Multi-Channel Communications: For example, if a company is trying to promote a new
product release, an email could be sent to a list of potential customers with a special
offer for those that also include their cell phone number. A couple of days later, a follow
up campaign would be sent via text message (SMS) with the special offer.
Also an email campaign can include a banner ad or link to a content download SERVING
as brand reinforcement
Can be personalized -- messages received can be highly targeted and specific to selected
criteria like a special offer for females, 21 years old or over and living in California.
Detailed tracking and reporting marketers can see not only how many people saw their
message but also specific information about each user such as their name as well as
demographic and psychographic data.
Global audience and interactive nature of the media
Different content by choice: A typical example for different content by choice in geo
targeting is the FedEx website at where users have the choice to select their
country location first and are then presented with a different site or article content
depending on their selection. This is called geo-targeting.
High Return on Investment (ROI) possible if executed the right way, push messaging
can help drive new revenue as well.
Internet marketers also have the advantage of measuring statistics easily and
inexpensively. Nearly all aspects of an Internet marketing campaign can be traced,
measured, and tested. The advertisers can use a variety of methods: pay per impression,
pay per click, pay per play, or pay per action. Therefore, marketers can determine which
messages or offerings are more appealing to the audience.

Consumers can easily connect with one another, often using multimedia sites such as
YouTube and Flickr, so they themselves can satisfy their need for information about

products. Whats more, consumers may trust information obtained in this way much
more than they do information from your company
From the buyer's perspective, the inability of shoppers to touch, smell, taste or "try on"
tangible goods before making an online purchase can be limiting.
Many consumers are hesitant to purchase items over the Internet because they do not
trust that their personal information will remain private. Encryption is the primary
method for implementing privacy policies. Customers are unaware if and when their
information is being shared, and are unable to stop the transfer of their information
between companies if such activity occurs.
Effects on industries
Music Industry- By 2008 Apple Inc.'s iTunes Store has become the largest music vendor in the
United States
Internet marketing is now overtaking radio marketing in terms of market share
e-commerce this is where goods are sold directly to consumers (B2C) or businesses (B2B). Of
those individuals who use the Internet, 44 percent now perform banking activities over the
Internet in the US
Internet Auctions have become popular- eBay is often used as a price-basis for specialized items
(Contributed by 2011)

26. Social Media Marketing

27. Experiential Marketing
Experiential marketing gives customers an opportunity to engage and interact with brands,
products, and services in sensory ways that provides exact and precise information. Personal
experiences help people connect to a brand and make intelligent and informed purchasing
decisions. It's the difference between telling people about features of a product or service and
letting them experience the benefits for themselves.
1. Hyundai Drive-In California event.
The event was organized to get a real feel of driving a Hyundai Car. They gave customers a trial
ride of Hyundai car on a special track made of obstacles. They were asked about the pick-up,
speed, control, handling and breaking comfortability, along with interiors of the car.
2. Nokia 5800 Xpress Music Activation Launch
They had their associates helping the customers in activating the service and giving a demo on

how to use it. It was totally new to the market and the customers had no idea about it. They
opened several music outlets and gave the customers a real feel of Xpress Music in Nokia
Phones. They also had Nokia handsets to experiment with. This allowed customers to actually
analyze the quality of music and other handset features.
3. Coca Cola New Grip Bottle
A multivillage fair with participation of various corporate all under one roof Where customer can
actually feel the experience of product by trial usage.
Products varying from Refrigerator to MotorBikes
(Contributed by 2011)

28. Green Marketing
The marketing of products that are presumed to be environmentally safe
Refers to the process of selling products and/or services based on their environmental
benefits. Such a product or service may be environmentally friendly in itself or
produced and/or packaged in an environmentally friendly way.
Incorporates a broad range of activities, including product modification, changes to
the production process, packaging changes, as well as modifying advertising
Also called Environmental Marketing and Ecological Marketing
Under Philips light Marathon they launched a CFL bulb as "Marathon," underscoring
its new "super long life" positioning and promise of saving $26 in energy costs over its
five-year lifetime
HP's promise to cut its global energy use 20 percent by the year 2010. The Hewlett-
Packard Company announced plans to deliver energy-efficient products and services
and institute energy-efficient operating practices in its facilities worldwide.
Indica EV- an electric car from Tata Motors which runs on polymer lithium ion batteries
For green marketing to be effective, you have to do three things; be genuine, educate your
customers, and give them the opportunity to participate.
1) Being genuine means that
a) that you are actually doing what you claim to be doing in your green marketing campaign and

b) that the rest of your business policies are consistent with whatever you are doing that's
environmentally friendly. Both these conditions have to be met for your business to establish
the kind of environmental credentials that will allow a green marketing campaign to succeed.
2) Educating your customers isn't just a matter of letting people know you're doing whatever
you're doing to protect the environment, but also a matter of letting them know why it matters.
Otherwise, for a significant portion of your target market, it's a case of "So what?" and your
green marketing campaign goes nowhere.
3) Giving your customers an opportunity to participate means personalizing the benefits of
your environmentally friendly actions, normally through letting the customer take part in
positive environmental action.

1. Online Shopping: Marketed by the Proposition of saving fuel and reducing pollution.
2. Ban of Plastic Bags to wrap customer purchases.
3. Toshiba Laptops: Concept of Eco utility (Built in power mode to reduce power
consumption), and the recycling scheme after your computer hardware gets old.
4. CFLs
5. Car sharing services
6. Introduction of CNG in Delhi
7. New Mantra of corporate: Companies like HP emphasize on saving energy by going
8. Videocon: look for the new campaigns
9. Automobile industry: Example is hybrid cars launched by Civic (in India)
10. Tetra pack of millk

(Contributed by Satyajit Bagchi 2012, 2011)

29. Guerilla Marketing
Philosophy of Guerilla Marketing
Major reasons why guerilla marketing draws analogy from the guerilla warfare are it is
associated with
a) Counters the traditional large spends on marketing through unconventional methods
which is effective yet involves much lesser spends
b) They are unexpected and unconventional where customers are targeted in unexpected
c) It should be based on human psychology instead of experience, judgment, and
Guerrilla Marketing: Defined
The concept of guerrilla marketing is an unconventional system of promotions that relies on
time, energy and imagination rather than a big marketing budget. Typically, guerrilla marketing
campaigns are unexpected and unconventional; potentially interactive; and consumers are
targeted in unexpected places. The objective of guerrilla marketing is to create a unique,
engaging and thought-provoking concept to generate buzz. The term was coined and defined by
Jay Conrad Levinson in his book Guerrilla Marketing
Guerrilla marketing involves unusual approaches such as intercept encounters in public places,
street giveaways of products, PR stunts, any unconventional marketing intended to get
maximum results from minimal resources.
Principles of Guerilla Marketing
Levinson identifies the following principles as the foundation of guerrilla marketing:
Guerrilla marketing is specifically geared for the small business and entrepreneur.
It should be based on human psychology instead of experience, judgment, and guesswork.
Instead of money, the primary investments of marketing should be time, energy, and
The primary statistic to measure your business is the amount of profits, not sales.
The marketer should also concentrate on how many new relationships are made each month.
Create a standard of excellence with an acute focus instead of trying to diversify by offering
too many diverse products and services.
Instead of concentrating on getting new customers, aim for more referrals, more
transactions with existing customers, and larger transactions.

Forget about the competition and concentrate more on cooperating with other businesses.
Guerrilla Marketers should always use a combination of marketing methods for a campaign.
Use current technology as a tool to empower your business.

Impact on Psychology
Nike passed these cards
out to runners so they
can alert their friends and
family that they have
"gone running". Its a nice
example of guerrilla
marketing work.


An M Better
Migros is the largest supermarket chain in
Switzerland and the largest employer in that
country. The orange M of that brand is quite
well known there and earlier this year the
M showed up on various town and city
signs, covering the M in those signs. A
guerrilla marketing activity that goes along
well with their campaign or in English "An M

3) McDonalds

More coffee please
Everyone loves free coffee, but that only
works when people find out about it. Along
those lines, this coffee pot lamp post
promoting FREE McDonalds coffee at the
intersection of 6th Ave and Cambie Street in
Vancouver is tough to overlook. The
promotion is only 2 weeks long, but the
memories of this ambient marketing effort
will last quite a bit longer.

4) Marlboro

We all know what Marlboro's are, but why? We
need to pay tribute to one of the earliest and most
successful guerilla marketing campaigns in
Americas advertising history.
Marlboro cigarettes had high status as a real
American brand. This high status came from the
introduction of "The Marlboro Man" in 1955 by Leo
Burnett Co. Before the rough cowboy image was
introduced, Marlboro brand was ranked 31st but
once this great marketing tactic went national they
reached the number one cigarette brand in


With many non-profits struggling during these economic times, a group in Denver wanted to put a
spotlight on the arts. To make people aware that public art and all art in the city comes at a cost; public
art pieces across Denver were covered with black plastic and wrapped with yellow caution tape. The
URL of was also featured prominently, and on that site people can pay ransom notes
and learn more on how they can get involved. A very clever guerrilla marketing implementation.

For More Examples:


German World Wide Fund PAPA JONES


Unconventional system of promotion, doesnt rely on high marketing budget
Campaigns are unexpected and unconventional, relying on time, energy and provoking thought

Interactive campaigns at unexpected places and unexpected time
Approaches: intercept encounters in public places
street giveaways of products
PR stunts
cutting edge mobile digital technologies
The following principles are the foundation of guerrilla marketing:
1. Specifically geared for the small business and entrepreneur
2. Should be based on human psychology rather than experience, judgment, and
3. The primary statistic to measure your business is the amount of profits, not sales
4. Acute focus instead of trying to diversify. Aim for more referrals. Use combination of
marketing methods
5. Messages are aimed at individuals or small groups, the smaller the better.
Guerrilla marketing was initially used by small and medium size (SMEs) businesses, but it is now
increasingly adopted by large businesses
(Contributed by Satyajit Bagchi 2012, 2011)
30. Image & Emotional Marketing

Rational only generates interest in the product the ultimate driver is emotion
The practice of emotional marketing is all about getting your target audience to connect with your
product, service, and brand at a very basic and fundamental level - the level of emotions.
Emotions drive our behavior; the world is driven by emotions. Rational thought leads customers to be
interested but it is emotion that sells. People really aren't much interested in attributes; they want to
know if they can have a product that suits their personality. It is all about values.
Emotional marketing is better in many instances than rational marketing that focuses on product
Emotional marketing appeals include personal and social needs, such as: security, comfort, happiness,
acceptance, self-esteem, status, achievement, saving money, or making money. These are basic
underlying feelings that drive our decisions and buying behavior. It may be a need for financial
security, which is associated with an image of a safe investments and insurance, or it could be a desire
for status and achievement, reinforced by the mental picture of luxury possessions.

Your marketing can target positive emotions through the use of unusual words, word rhythms and
rhymes, colors or shapes, pictures, numbers, or symbols, which reveal the associated feelings of a
previous experience, like the pleasant smell of food cooking, or a day at the beach. Appealing to an
underlying desire that triggers an automatic memory image can cause an emotional response that

reinforces logical thoughts, which converge and lead to a buying decision.

Rather than using ads with dull corporate speak, unfamiliar industry jargon, or selling how good you
are, try tapping into the direct process of brain patterns and emotional images with sharp, specific,
and relevant details that can sway the buying choices of your potential customers.

Nike succeeds because its core belief - its brand promise, its love of the potential for the athlete inside
everyone lives inside the people in Beaverton. When that love is manifested in their gear, consumers
manifest it in their own lives." The result is not only an emotional connection but an individual one.
Having a one-to-one relationship in today's marketplace is essential for market dominance. Other
examples can be seen with other top brands such as Starbucks, Porsche, and so on. These products
and services make an emotional connection with the people they serve.

The Starbucks Example
Starbucks is one of the strongest global brands around without following the marketing text book. Its
complicated logo is not memorable, and most people will not be able to recreate it if you ask them to.
They will describe it as something green roundish with a person or something in the middle. The
slogan is not memorable either, and before you rack your brains, Starbucks doesnt have one. The
packaging and collateral are nothing special and I challenge you to find an advertisement in any
magazine. Starbucks does advertise, but uses emails as the preferred medium.
So what is the success factor of the Starbucks brand? The emotional experience of its consumers
they feel sophisticated and part of what many brand experts refer to as a "coffee house" community.
For the Starbucks community, coffee is not just a beverage, but it is a ritual, a habit, a treat, and a
satisfying reward all rolled in one.
Thats the reason why Starbucks cup sizes are "grande" and "venti," not medium or large. Each cup of
coffee is also freshly made by a "barista" at a separate counter and never behind a wall or out of sight
from the customer. The Starbucks store has tables and chairs for congregating or reading and working.
, and many have plush sofas and armchairs. Many Starbucks also have Internet connection for their
customers convenience

A few marketing techniques work well in emotional marketing:
Word of mouth - people trust other people that tell them your product works or if it is the best.
Forums - this is basically electronic word of mouth.
Trials - if you have concrete results, and the people who participated in the trials are satisfied, you
have proof that your product works, which appeals to people's skeptical side.
Testimonials - again, people trust other people. If people are willing to take the time to give a
testimonial, others will know you have a great product.

Emotional Marketing may also include Sensory-emotional marketing.
Some examples - Singapore Airlines and Starbucks
*Singapore Airlines+ not only employs the more common consistent visual themes one might expect
from an airline, but incorporates the same scent, Stefan Floridian Waters, in the perfume worn by
flight attendants, in their hot towels, and other elements of their service. Consumers then link the
airline to the scent and, should they be smell Stefan Floridian Waters again, will be reminded of the
airline and the pleasant emotions it brought them.
Starbucks also uses a scent, the smell of freshly ground coffee beans, in its business. In a separate

article by Roger Dooley, he reports that, The most startling change is that the firm will go back to
grinding coffee in its stores for the sole purpose of improving the coffee aroma. Presumably, its
cheaper to ship the coffee pre-ground in sealed packages, but Starbucks management apparently feels
that any productivity loss at the stores will be offset by improved customer loyalty and higher sales.
(Contributed by G. Chandana 2012; 2011)

31. Line Extension
Line Extension: A product line extension is the use of an established products brand name for a new
item in the same product category. Line extensions happen when the brand launches the new
product in the same category targeting a new segment through new forms, colors, added
ingredients, package sizes etc. Product Extensions help in the growth stage of PLC.

Surf, Surf Excel, Surf Excel Blue
Coke, Diet Coke, Vanilla Coke
Clinic All Clear, Clinic Plus
Colgate going onto colgate fresh, colgate total, colgate cibaca
A line can comprise related products of various sizes, types, colors, qualities, or prices. Line
depth refers to the number of product variants in a line. Line consistency refers to how closely
related the products that make up the line are. Line vulnerability refers to the percentage of sales or
profits that are derived from only a few products in the line.

When you add a line extension that is of better quality than the other products in the line, this is
referred to as trading up or brand leveraging.

A Word of Caution - Although we might tend to think that Line Extension leads to more sales due
because of more products and the company is anyways leveraging the brand equity that it has created.
But it can sometime lead to drop in sales too, because it creates confusion in the minds of the
consumer as to what the brand means. On example of that is 7Up. It became popular as a Lemon
Uncola but in 1978 introduced many flavours such as 7Up Gold and Cherry 7Up and various diet
versions too. As a result its sales dropped from 5.7% of the soda beverage market to 4.2%.

Line extension is to offer a new product under the same brand name, in the same product category.
The parent brand covers a new product within a product category it currently serves, such as with new
flavours, forms, colours and ingredients.
Its advantages are:
It helps in strengthening the brand power and keeps the brand live, modern and contemporary.
It helps in satisfying the changing desires of customers that is variety-seeking.
It reduces risk associated with new product introduction in customers and distributors.
It provides a convenient route for infusing new values into an ongoing brand and gaining presence in
new market.
It decreases the cost of gaining distribution and trial.
It increase efficiency of promotional expenditures and allow for packaging and labeling efficiencies.
Its disadvantages are:
In case of failure it would affect the product itself and slight connections with the brand image.

(Contributed by Sukesh Gain 2012; 2011)

32. Marketing Myopia
Marketing Myopia is the lack of vision on the part of companies, particularly in failing to spot
customers desires through excessive product focus.
Marketing Myopia is the failure to define an organization's purpose in terms of its function from the
consumers' point of view. For example, railway companies that define their markets in terms of trains,
rather than transportation, fail to recognize the challenge of competition from cars, airlines, and
buses. It is therefore necessary to define the needs of the consumer in more general terms rather than
product-specific terms.
Marketing Myopia is the short sighted look of the managers in wrongly identifying the category and
goals of the company, not looking at the whole industry of the product neglecting the fields of
opportunities in their area of industry, not listening to the customer's real needs.
Marketing Myopia is a short sighted and inward looking approach to marketing that focuses on the
needs of the firm instead of defining the firm and its products in terms of the customers' needs and
wants. Such self-centred firms fail to see and adjust to the rapid changes in their markets and, despite
their previous eminence, falter, fall, and disappear. This concept was discussed in an article (titled
'Marketing Myopia,' in July-August 1960 issue of Harvard Business Review) by Harvard Business School
emeritus professor of marketing, Theodore C. Levitt (1925-), who suggests that firms get trapped in
this bind because they omit to ask the vital question, "What business are we in?"
Political Parties and Marketing Myopia Afflictions
The expulsion of Jaswant Singh from the BJP points to the party falling prey to what's termed
'Marketing Myopia'. With Jaswant, one of the only symbols of urban sophistication in an otherwise
rustic party, gone, the BJP has lost its last hope at connecting with a rapidly changing voter
demographic in India.
Liberalised urban India seeks sophistication in their lifestyle. A party saddled with symbols, real (read,
the people) and contrived (read, the brand) that seem like they are a throwback to yore, will find it
increasingly difficult to connect with voters who want move forward and leave behind cultural
hangovers of the past. Of course, the party bets it will connect with 'less sophisticated' masses who
identify with what's rural and rustic. But tell you what, even the 'less sophisticated' crave urban
sophistication. And the mass media has presented to them on a platter, a lifestyle that they may not
for the moment enjoy, but surely crave. After all, who amongst the citizenry looks to staying still?
Staying stuck to relics of the past and the soon to be obsolete present?
Its the 'moving on' masses the BJP will miss if it holds on to what it calls ideology. The inability to see
the future and design offerings that will be relevant in that future to come, is what's termed,
Marketing Myopia. And not knowing that isn't ideology that matters, and that its about what the voter
wants, is a learning that's imperative. Its a learning of what businesses know keeps them alive and
Case Study: Ambassador as an example of Marketing Myopia

The fall of Ambassador from a leadership position to a marginal player is a classic case of marketing
myopia. For four decades, the brand has been taking its customers for granted. There are many
reasons that can be attributed to this brand's failure. The fundamental issue was with the product and

If we look at the product, Ambassador never changed with times. The brand made many cosmetic
changes from 1958-2000 and three upgrades was made which was named as Mark II, Mark III and
Mark IV. There was no significant value addition between these upgrades. The look and the built
quality remained the same. A major change happened when the brand introduced a 1800 Isuzu
engine. The Amby with Isuzu again lifted the sales of the brand. But the euphoria was short lived.

The apathy of HM to offer product changes in tune with the times made the brand stale. Second factor
that failed Amby was the price. HM never bothered to rationalize the price of the brand. Even now
Ambassador costs more than Rs 4,80,000. At that price one could afford a more luxurious Indigo

According to reports, the HM plant had achieved full depreciation in 2000. But the company did not
thought of passing on the reduced cost to the consumer. Had the company rationalised the price of
Amby in 2000, the brand could have survived the competition.
The nail in the coffin came with the launch of Indica. Indica took away the taxi car market from
Ambassador. Again the diesel loving individual consumers had a better affordable modern car as
compared to the ageing Ambassador.

In order to lift the sagging sales of the brand, HM launched a radically designed Ambassador variant
Avigo in 2004. Although the styling was radical, the customer response was lukewarm.

Indian consumer is now spoilt with choices. The competition is immense and the quality of cars has
also gone up. Consumers now have new set of purchase considerations like quality, brand, drivability,
luxury, cost of maintenance etc
In the value proposition domain, Ambassador is never in the radar of the consumers. The narrowing
price difference between petrol and diesel also eroded the value in investing in an old dated

The company also has never invested in the brand. Without investing in either brand or product, HM
had sealed the fate of this brand.
(Contributed by 2011)

33. Non-Conventional Advertising mediums
Non-traditional advertising is a form of advertising that is atypical. Non traditional advertising
can encompass alternative media and outdoor media. New emerging methods of advertising, the use
of mediums that break from traditional advertising models. More traditional companies find it difficult
to embrace non-traditional advertising, but are slowly becoming more aware and open-minded that it
is a way of reaching consumers with a greater impact.
There are two parts of such advertisements; the virtual world of engagement and the Physical world
of engagement.

Online Advertising
Display Ads or banner ads are small, rectangular boxes containing text and perhaps a picture that
companies pay to place on relevant Web sites. Traditional these banners were placed on top of the
web site or on the side panels, however now youtube videos also have such ads below the video.
Interstitials: advertisements often with a video or animation, that pop up between changes on a Web
site. Ads for Johnsons & Johnsonss Tylenol headache reliever would appear on brokers web sites
whenever the stock market fell by 100 points.
Sponsorships: Companies get their name of the web site by sponsoring certain content on the site.
Online Communities: many companies sponsor online communities whose members communicate
through postings, instant messaging and chat discussions about special interests to the companys
brands and products. GlaxoSmithKline when launched their first weight-loss drug Alli, they sponsored
a weight-loss online community.
Social Media: Companies use social networking websites as a platform for advertising too. They
project display ads to focus on their target audience using information given by users on the website.
Examples: facebook, orkut, myspace, friendster.
Mobile Marketing: Every 2 minute mobile episode of Foxs show Prison Break starts with a 10 second
message that show cases Toyotas new subcompact sedan Yaris.
Place advertising
Or out of home advertising, is a broad category including many creative and unexpected forms to grab
customers attention. The rationale is that markers are better off reaching people where they work,
play and of course shop.
Billboards have been transformed and now use colorful digitally produced graphics, backlighting,
sounds movement and usual 3 dimensional images.
Example: the Nokia N97 Live online Billboard ad, which displays the N97 screen with scrolling text.
Product placement in movie: Movie Viruddh, where Amitabh Bachan and John Abraham discuss the
benefits of Westerm Union.
Product Sampling: Giving free samples of the product at malls.
Contextual Advertising: Contextual advertising is a form of targeted advertising for advertisements
appearing on websites or other media, such as content displayed in mobile browsers. The
advertisements themselves are selected and served by automated systems based on the content
displayed to the user.
Wrapped Vehicles can include public transportation buses, trucks, shuttles, vans, automobiles, etc.
This high-impact format reaches both pedestrian and vehicular traffic and provides market
penetration by traveling throughout the target region. Entirely covered by full-color advertising design,
which is specifically for the vehicle. The customized overall design of this format provides eye-catching
attention, promotional value and makes a statement about the advertiser. Example: Santro Xing

Guerilla marketing efforts such as street teams are a form of non-traditional advertising. It is a way of
getting the viewers attention without them expecting it. This kind of advertising uses a surprise effect
to tantalize the viewer when they are in a situation where they would not typically find media.
Examples: The 7up Street teams offering free samples during peak hour traffic
Ad for Mr. Clean

T-Shirt TV: the interactive T shirt of the future at the Cannes advertising festival
3M filled a container with money and let it at a bus stop. The glass is a special "Security Glass"
that is touted as "unbreakable".
In New York, Chinese food is being delivered with a message from Cingular Wireless imprinted
on the food containers.

Another new trend is elevator advertising. High resolution ads are placed on a screen in
bustling high-rise condos or office buildings. The average number of riders per day is at least
500, which translates to approximately 90,000 views in a six month period.
The Tokyo Ubiquitous Network Project currently has the technology, to send shoppers
personalized advertising messages on their cell phones, as they stroll by a store.
Another recent phenomena is to create brand awareness by solving community problems. Two great
examples of this are:
Aircel stuck an empty raft on a billboard near the Milan Subway in Mumbai (which is notorious
for flooding during the monsoons). The copy simply said, In case of emergency, cut rope. Sure
enough, on July 13, Mumbai was flooded and so was Milan Subway. People in and around the
area promptly removed the raft and used it to get around. This functional innovation was the
talk of the town and got wide coverage in local media. Apart from the goodwill it generated
among consumers (some of whom were referring to it as the Aircel boat), the buzz that it
generated in unpaid media was huge.
The worlds first solar powered billboard was introduced in Africa by Nedbank. It harnesses the
solar energy of the sun into a much needed necessity: electricity. It currently powers the
kitchens of a township primary school, and will, in time, completely generate the schools
required power needs.

(Contributed by Sukesh Gain - 2012; 2011)

34. PLC and Strategies at Each Stage
The PLC is a model that illustrates the different stages (six in total) that a product or service will
pass through. Each stage has its own attributes and will vary in length (time) with different products
and services. The time that it takes for your product/service to move through the PLC will largely be
determined by how effective your marketing plan is. It should therefore be stressed that the PLC is a
marketing tool to assist you when compiling a marketing plan.
Below is a diagram of the Product Life Cycle:

Stage 1: Development
As soon as you put pen to paper, this is where the PLC of the product/service begins. This is the time
where you will design and develop your product/service with all the direct costs that may be incurred
such as wages, materials for prototypes, research, etc.
During development, a product/service may never move onto the next stage because you may decide
that the risk is too high to launch the product/service. It is important that you recognize any risk
during this time as small businesses will be affected if the product/service does not prove to be
successful once introduced: the costs of development and introduction may never be recovered where
larger companies can usually compensate for unsuccessful products.
Within this stage, the product has not yet been introduced to the market and consequently there are
no sales. The expenditure of development has also created a loss.
Stage 2: Introduction
It is arguable that this stage can influence the length of the PLC and so the product/service should be
introduced in the market as effectively as possible. This is the time when the product/service is new in
the market and a high degree of marketing will be needed such as promotions and advertising to
increase commercial awareness.

Sales will be slow during the introduction stage and so you should not become impatient and spend
more money than necessary to try to increase the speed of sales: it will take time for people to use
and trust your product/service.
As you begin to make sales, the money used for developing and introducing the product/service may
not be fully recovered (i.e. break-even) until late in the introduction stage. Once you begin to make
profit, you may decide to re-invest the money back into promoting the product/service in an attempt
to stimulate future sales (and profit).
Stage 3: Growth
Once your product/service has become established in the market, you can expect the number of sales
to increase rapidly and marketing expenditure may now be used for brand building. This is the stage
where you will benefit from high profits but this is also the stage where your profits will peak. Services
over products will generally have far longer periods of growth (usually years) where products,
particularly those that are new, will soon attract the attention of
Once competitors join the bandwagon, the sales will gradually slow down and force you into
marketing new prices: consequently resulting in fewer profits. If you have released your own version
of an existing product (making you the competitor), then the growth stage may be short depending on
how long the existing product has been available in the market.
Stage 4: Maturity
The stage of maturity begins when the product/service sales peak and become stable mainly due to
the introduction of competitors during the end of the growth stage (influencing the move into the
maturity stage).
As pricing becomes more competitive (resulting in even less profits), many businesses, commonly the
smaller businesses, cannot compete and consequently withdraw their product/service from the
Maturity does not only result from increased competition, but also by new alternative
products/services in the market becoming more popular. Quite often, services in particular are
withdrawn because they are no longer needed, unfavourable or out of fashion.
Stage 5: Saturation
The saturation stage is sometimes overlooked in many PLC models but is seen as the first sign of
product/service decline. At this point, the product/service has no future for profits because there are
too many competitors or the product/service is no longer popular.
Stage 6: Decline
The product/service moves into the decline stage when sales start to drop continuously and will be a
result of the issues that moved the product through maturity and saturation (competition, low
demand, unfashionable, etc).

The time taken to reach this stage of the PLC will differ with different products/services: for an
extreme example, Kellogg's still have a range of cereals that are as popular today as when they were
first released in the early 1900s. Also note; Kelloggs may have the number one cereal, but they have
to spend a lot of money advertising that fact: there being nothing new or exciting about plain old
cornflakes makes this a great example of brand marketing.
In the small business world, when your products/services move into decline, it is a good idea to either
improve your product or remove it completely to avoid damaging your image.
Extending the PLC: Extension Strategies
The most profitable period of the PLC is during the later stages of growth (stage 3) and maturity (stage
4). This is the reason why many businesses try to delay the product/service from reaching the decline
stages for as long as possible. This is done by introducing PLC extension strategies during the maturity
Although you may have your own ideas, the more common strategies include:
A move into new markets e.g. supermarkets selling clothing
Introducing accessories to the product or new additions to the service e.g. introducing financial
management advice in accountancy book keeping services
Changing the design and functionality of the existing product e.g. the packaging design, colour
range, mobile phones used for Internet access
The Problems of PLC Models
Not all products/services go through every stage of the PLC and it is common to go straight from the
introduction stage to decline: this may be seen as a result of poor marketing. It is often hard to tell
which stage the product/service is in and consequently marketing actions could be taken, as said
before, too early or too late. It is then fair to say that the model can only be used to help identify the
symptoms of each stage. Every product/service will spend different lengths of time in each stage and
there is no physical way of showing this on the PLC model. However, the better your financial control,
the more you will be able to track individual products/services.
The PLC model is only part of the marketing mix and is used to determine the different stages that a
product or service can be expected to go through. By using the model as guidance, effective and
timely marketing will take the product/service through each stage and can be planned in advance (the
marketing plan. The PLC model illustrates that profits are highest during the stages of growth and
maturity and so it is good business to integrate extension strategies during this time to maintain high
profit levels.

Introduction stage of PLC
The need for immediate profit is not a pressure. The product is promoted to create awareness.
If the product has no or few competitors, a skimming price strategy is employed. Limited numbers of
product are available in few channels of distribution. Advertising differentiates the product.
Decide when to enter the market. To be first can be rewarding but very risky and expensive.
But pioneer advantage is inevitable as they set the trend for the market class
Speeding up innovation is essential in an age of shortening product life cycles
Rapid-Skimming strategy involves launching the new product at a high price and high
promotion levels
Slow-skimming strategy involves launching the new product at a high price and low promotion.
Rapid-Penetration strategy involves launching the new product at a low price and high
Slow-Penetration strategy involves launching the new product at a low price and low level of
Print ad of a Printer giving details about its specifications
Growth stage of PLC
Competitors are attracted into the market with very similar offerings. Products become more
profitable and companies form alliances, joint ventures and take each other over. Advertising spend is
high and focuses upon building brand. Market share tends to stabilise. Advertising establishes
participation with the marketplace.
Improve product quality and add new features and improved styling
Add new models and flanker products (i.e. products of different sizes, flavors, and so forth that
protect the main product.
Enter new market segments.
Increase distribution coverage and enter new distribution channels
Lower price to attract the next layer of price-sensitive buyers
Shifts from product awareness advertising to product-preference advertising.
Maturity stage of PLC
Those products that survive the earlier stages tend to spend longest in this phase. Sales grow at a
decreasing rate and then stabilise. Producers attempt to differentiate products and brands are key to

this. Price wars and intense competition occur. At this point the market reaches saturation. Producers
begin to leave the market due to poor margins. Promotion becomes more widespread and use a
greater variety of media. Advertising puts price ahead of the competition.
Market modification: the company might try to expand the market for its mature brand by increasing
the number of users and/or the usage rate.
Convert non users
Enter new market segments
Win competitors customers.
Promote more frequent use
Use more of the product on each occasion
New and more varied uses
Eg: Johnson & Johnson promoted its baby shampoo to adult users. Pears introduced pink soap to
target children
Product modification: Manager also try to stimulate sales by improving the products quality, features
or style.
Quality improvement increase the products functional performance. Eg: Pillsbury advertises
its wheat flour as chakki fresh atta and good for familys heart
Feature improvement add new features Eg: Pfizer embarked on feature improvement for its
Listerine brand
Style improvement increase the products esthetic appeal.
Marketing mix modification: Modify other marketing program elements such as
Pricing cuts, discounts, special occasions, credit terms, increase price and quality
Distribution more outlets and new distribution channels
Advertising increasing expenditure, change message, timing and frequency of advertising
Sales promotion - stepping up or reducing sales promotion
Personal selling increase quality of sales force and sales territories
Services speed up delivery and technical assistance.
Decline stage of PLC
At this point there is a downturn in the market. For example more innovative products are introduced
or consumer tastes have changed. There is intense price-cutting and many more products are
withdrawn from the market. Profits can be improved by reducing marketing spend and cost cutting.

Defensive advertising or for revitalization.
Increase investment to dominate or strengthen its competitive position
Maintain its investment level until the uncertainties about the industry are resolved
Decrease its investment level selectively, by sloughing off unprofitable customer groups, while
simultaneously strengthening its investment in lucrative niches
Harvesting investment to recover cash quickly
Divest the business quickly by disposing of its assets as advantageously as possible

35. Positioning and Differentiation (Done)

36. Promotion Mix (Done)

37. Recession Marketing
Recession: A significant decline in activity across the economy, lasting longer than a few
months. It is visible in industrial production, employment, real income and wholesale-retail trade. The
technical indicator of a recession is two consecutive quarters of negative economic growth as
measured by a country's gross domestic product (GDP);

Marketing: Marketing is the process by which companies create customer interest in goods or
services. It generates the strategy that underlies sales techniques, business communication, and
business development. It is an integrated process through which companies build strong customer
relationships and create value for their customers and for themselves.
John Quelch, a prof at HBS identifies 8 factors which companies should bear in mind before
strategizing marketing policies.

1. Research the customer. Instead of cutting the market research budget, you need to know more
than ever how consumers are redefining value and responding to the recession. Consumers take more
time searching for durable goods and negotiate harder at the point of sale. They are more willing to
postpone purchases, trade down, or buy less.
2. Focus on family values. When economic hard times loom, we tend to retreat to our village. Look for
cozy hearth-and-home family scenes in advertising to replace images of extreme sports, adventure,
and rugged individualism. Zany humor and appeals on the basis of fear are out. Greeting card sales,
telephone use, and discretionary spending on home furnishings and home entertainment will hold up
well, as uncertainty prompts us to stay at home but also stay connected with family and friends.
3. Maintain marketing spending. This is not the time to cut advertising. It is well documented that
brands that increase advertising during a recession, when competitors are cutting back, can improve
market share and return on investment at lower cost than during good economic times. Uncertain
consumers need the reassurance of known brands. If you have to cut marketing spending, try to
maintain the frequency of advertisements by shifting from 30-second to 15-second advertisements,
substituting radio for television advertising, or increasing the use of direct marketing, which gives

more immediate sales impact.
4. Adjust product portfolios. Marketers must reforecast demand for each item in their product lines as
consumers trade down to models that stress good value, such as cars with fewer options. Tough times
favour multi-purpose goods over specialized products, and weaker items in product lines should be
pruned. Gimmicks are out; reliability, durability, safety, and performance are in. New products,
especially those that address the new consumer reality and thereby put pressure on competitors,
should still be introduced, but advertising should stress superior price performance, not corporate
5. Support distributors. In uncertain times, no one wants to tie up working capital in excess
inventories. Early-buy allowances, extended financing and generous return policies motivate
distributors to stock your full product line. This is particularly true with unproven new products. Be
careful about expanding distribution to lower-priced channels; doing so can jeopardize existing
relationships and your brand image. However, now may be the time to drop your weaker distributors
and upgrade your sales force by recruiting those sacked by other companies.
6. Adjust pricing tactics. Customers will be shopping around for the best deals. You do not necessarily
have to cut list prices, but you may need to offer more temporary price promotions, reduce thresholds
for quantity discounts, extend credit to long-standing customers, and price smaller pack sizes more
aggressively. In tough times, price cuts attract more consumer support than promotions such as
sweepstakes and mail-in offers.
7. Stress market share. In all but a few technology categories where growth prospects are strong,
companies are in a battle for market share and, in some cases, survival. Knowing your cost structure
can ensure that any cuts or consolidation initiatives will save the most money with minimum customer
impact. Companies such as Wal-Mart and Southwest Airlines, with strong positions and the most
productive cost structures in their industries, can expect to gain market share. Other companies with
healthy balance sheets can do so by acquiring weak competitors.
8. Emphasize core values. Although most companies are making employees redundant, chief
executives can cement the loyalty of those who remain by assuring employees that the company has
survived difficult times before, maintaining quality rather than cutting corners, and servicing existing
customers rather than trying to be all things to all people. CEOs must spend more time with customers
and employees. Economic recession can elevate the importance of the finance director's balance sheet
over the marketing manager's income statement. Managing working capital can easily dominate
managing customer relationships. CEOs must counter this. Successful companies do not abandon their
marketing strategies in a recession; they adapt them.
(Contributed by Rahul Kishore Singh -2012)

38. Reviewing 10 recent ads (Elaborate)
1. Airtel Digital TV
Dil Titli part 2
Saif & Kareena
This ad is extension of previous Dil Titli ad of Airtel Digital TV. However, connection is minor & this ad
comes forward as more straight-forward, shorter version & focuses mainly on CLARITY of network
where Saif describes & demonstrates difference. Small animation of Satellite functioning is also added
to explain MPEG4 DVB-2 technology. These 2 points make differentiation with other brands clearer.
This ad now brings CLARITY as USP. Previous campaign like Stars Come Home does not focus on any

characteristics of product. Same can be said about launch campaign.
Even though Aamir Khans sardar ad for Tata Sky also has Clarity as its theme, there are no visuals on
Shahrukhs new DishTV ad focuses on low cost of network while Airtel keeps price visual subtle.
Dil Titli ad 1 is also attached. This ad is longer but explains CLARITY aspect equally well as ad 2.

2. Mont Blanc India Ad

Mont Blanc India Ad-The TVC was launched across channels on September 23, 2009.
Featuring Anil Kapoor and Sonam Kapoor
Tagline-Mont Blanc, A story to tell
Length-1:04 min
Insight-Behind every Mont Blanc Pen there is a story.
Agency- O&M
Mont Blanc has rolled out its first TV-led campaign in India. The commercial features actor Anil Kapoor
and daughter Sonam Kapoor. The campaign takes forward the brand's base proposition, which says
that a Montblanc is not just a pen, but a heritage or legacy that is passed on from generation to
The commercial begins with Kapoor reminiscing about the time he decided to become an actor. When
he told his father about it, the latter didn't offer him any help, but did hand his son a Montblanc pen
The power to write his own destiny. This is followed by certain Images of his legendary films which
confirm that Anil kapoor is indeed a success. Later, Sonam walks into her father's study and tells him
that she too, wants to become an actor. Anil Kapoor tells his daughter the same thing that his father
had said to him years ago don't expect any help from me. However, he too, hands over the
Montblanc pen that his father had given him.
The thought for the TVC comes from the insight that behind every Montblanc pen, there is a story. It is
a pen meant for those who have the power within them to write their own destiny. The Ad portrays
the relationship between a father and a daughter and how the bond between them is further
strengthened by the legacy that is imbibed in the pen. The brand stands for lineage of exclusive and
exquisite brand. Internationally, it is a well established brand, and the objective of the Ad is to narrate
the story of its heritage and not increase sales or volumes. It establishes the message that the brand is
associated with great success stories.
The opening and closing frames of the TVC is of a grand image of a Mont Blanc writing instrument. The
entire ad is shot with the background of a very exquisite room and the overall feel of the entire ad is
very Rich. Even though the ad has a very interesting story and powerful celebrities (Anil kapoors First
endorsement), the product does not lose focus and is the mainstay of the TVC.

Also this ad would be supplemented greatly by Print and outdoor ads based on the same characters
and story, which I believe would have a greater impact on its target customers
Criticism- The ad is based on the Theme already used very successfully in the west by another super
luxury watch brand, PATEK PHILIPPE, in its legendary Generations Commercial.

39. Sales & Trade Promotion

40. Sports Marketing
Using sports to market products is Sports Marketing!
Sports marketing is a branch of the marketing industry that involves the promotion of and the
arrangement of sponsorship deals for sporting events, venues, teams, and individual athletes. Those
who work in the field are often employed by a specialty agency, a sports franchise, or by the
marketing division of a corporation that promotes its products through athletic sponsorship.
It can be classified into two subgroups:
The specific application of marketing principles and processes to sport products (e.g., teams,
leagues, events, etc.) and
The marketing of non-sports products (e.g., cigarettes, beer, long-distance phone service, etc.)
through associations with sports.
Common examples of sport marketing include athlete endorsements, testimonials, event marketing
and stadium advertising

The origination of the marketing discipline known as sports marketing coincided with the advent of
the first MLB (Major league Baseball ) game ever televised on August 26, 1939 and as a result made
Babe Ruth the first six-figure athlete in the history of professional sports.
The expansion of sports marketing began in the "open era" of professional tennis and golf. From the
seventies to early eighties, the corporate sponsorship of Lamar Hunt's WCT Tennis Events and PGA
Tour golf tournaments first launched this modern-day marketing discipline.
Sports marketing morphs advertising, sponsorship, promotion, sales promotion, and public relations
into one of marketing's most effective tools to reach and touch consumers.
Sports today utilize corporate sponsorships and television money in order to compete and pay for top
quality athletes. Those companies use teams, leagues, colleges, and individual s to differentiate their
products in a very competitive business environment.

IPL is good example of sports marketing ..however rising cost of sponsoring cricket events are forcing
sponsors to other sports.
An image of stickers on a NASCAR racecar, from
companies with large advertising contracts.

(Contributed By Manmeet Singh -2012)

41. Types of Advertising
Advertising can be classified in different ways.
1. According to the medium used, advertising is of the following types:
Print Advertising Newspapers, Magazines, Brochures, Fliers
Outdoor Advertising Billboards, Kiosks, Tradeshows and Events
Broadcast advertising Television, Radio and the Internet
Covert Advertising/Product placement Advertising in Movies
2. Advertising can also be categorized as the following:
Surrogate Advertising Advertising Indirectly
Public Service Advertising Advertising for Social Causes
Celebrity Advertising
Business to Business advertising

Co-op advertising
3. On the basis of intent, Advertising can be split into two main types:
Persuasive advertising - this tries to entice the customer to buy the product by
informing them of the product benefit.
Informative advertising - this gives the customer information. Mostly done by the
government (e.g. health campaigns, new welfare benefits).
4. Based on what is being advertised, it can be further classified into:
Product-oriented advertising
Image advertising
Public service advertising
(Contributed by 2011)

42. USP, ESP
USP (Unique Selling Point): THE LOGICAL BENEFITS
The task of projecting your product as something which has differentiating factors comes under the
ambit of USP.
USP can be:
1. Product (Include features, packaging etc.)
2. Service
3. Combination of product and service
They should resonate with the needs and wants of the consumer.
1. Samsung new mobile Marine: Features like Unbreakable, Water Proof
2. NANO, Worlds cheapest car
3. Mac Book Air: Worlds lightest laptop
4. Slim Cameras

5. Nokia 1100: Torch Light
Uniqueness can be sought in a number of ways:
1. By offering the lowest price. John Lewis, a British department store, used to claim that it was
never knowingly undersold. Its USP established it as the cheapest vendor (under certain prescribed
conditions) of the items that it sold. But this is a rocky route to success, particularly at a time when
there are firms prepared to sell (temporarily) at well below cost just to establish turnover. This was the
case with many early internet retailing experiments. Moreover, buyers who base their purchasing
decisions on price alone are often disloyal. Customers continue to go to John Lewis for many reasons
other than its price promise.
2. By offering the highest quality. This is the Rolls-Royce approach to selling.
3. By being exclusive. In the information age, this is an increasingly common type of USP. More
and more firms offer a unique packaging of information or knowledge.
4. By offering the best customer service. Dominos Pizza became the bestselling brand in the
United States on the basis of its USP: Fresh, hot pizza delivered in 30 minutes or less, guaranteed. It
did not promise high quality or low price, just fast delivery. A side benefit of a USP like this is that it
compels the firms employees to try that bit harder to achieve the promise. A firm that fails to fulfil
the promise in its USP is condemned to a short future if it cannot quickly come up with a new one.
5. By offering the widest choice. This is particularly appropriate to niche markets. A specialist
cheese shop, say, can claim to offer a wider selection of cheeses than anyone else.
6. By giving the best guarantee. This is particularly important in industries such as travel and
catalogue selling, where customers pay for something upfront and then have to hope that what they
think they have bought is eventually delivered.
Emotional Selling Point:
It is said that people buy emotionally and then justify logically.
The Emotional Selling Proposition gives you the opportunity to control the marketing message and to
drive an emotional reaction that creates the connection and triggers "I want this. I am going to buy it."
Ex: You can emphasize the end emotion after purchase - L'Oreal's "Because you're worth it"
emphasizes pride and recognition of your own self worth,
Caveat: Narrator: I like the idea of an emotional selling proposition to help emphasize the benefit
payback but you can't abandon logical benefits supported by credible features.
The use of the ESP is more of a strategic than a tactical decision and has to be approached very

1. Incredible India Campaign: Kerala Gods place on Earth
2. Cadbury: 1-1/2 glass of milk
3. Insurance schemes like Sar Utha ke Jeeyo, Almost all of them
4. Polio Campaign Do Boond Zindagi Ki and other social cause campaigns against poverty, AIDS
5. Hero Honda Pleasure Why should boys have all the fun

6. L'Oreal's "Because you're worth it" emphasises pride and recognition of your own self worth
7. "Finger lickin' good" from KFC
8. "Make safe sex feel sexy" (Durex condoms)

So think about the feelings and the emotions that you want to stir up with your prospects and clients
and use this in your sales. Can your product/service make the prospect:
* Feel important
* Feel valued
* Feel part of a unique group or select band of people
* Feel whole
* Feel remembered
* Feel attractive
* Feel trendy
* Feel hip
* Feel safe
* Feel accepted
"USPs are great but ESPs are even better"
One Word of Warning
I like the idea of an emotional selling proposition to help emphasise the benefit payback but you can't
abandon logical benefits supported by credible features.
If people decide emotionally, they still justify rationally to themselves and to other people so you need
to give them to ammunition
(Contributed by Manmeet Singh 2012; 2011)

43. What are different types of distribution channels?
Marketer uses distribution channels to display, sell or deliver the physical product or service to
the buyer or user. They include distributors, wholesalers, retailers and agents. A number of alternate
'channels' of distribution may be available: Distributor, who sells to retailers; Retailer (also called
dealer or reseller), who sells to end customers; and Advertisement typically used for consumption
There have also been some innovations in the distribution of services. For example, there has been an
increase in franchising and in rental services - the latter offering anything from televisions through
tools. There has also been some evidence of service integration, with services linking together,
particularly in the travel and tourism sectors. For example, links now exist between airlines, hotels and
car rental services. In addition, there has been a significant increase in retail outlets for the service
sector. Outlets such as estate agencies and building society offices are crowding out traditional grocers
from major shopping areas. Activities involved in the channel are wide and varied though the basic
activities revolve around these general tasks:
Handling and shipping
Information feedback

Channel members: Distribution channels can thus have a number of levels. Kotler defined the
simplest level that of a direct contact with no intermediaries involved, as the 'zero-level' channel. The
next level, the 'one-level' channel, features just one intermediary; in consumer goods a retailer, for
industrial goods a distributor. In small markets (such as small countries) it is practical to reach the
whole market using just one- and zero-level channels. In large markets (such as larger countries) a
second level; a wholesaler for example, is now mainly used to extend distribution to the large number
of small, neighbourhood retailers or dealers. In Japan the chain of distribution is often complex and
further levels are used, even for the simplest of consumer goods. In Bangladesh Telecom Operators
are using different Chains of Distribution, especially 'second level'. In IT and Telecom industry levels
are named "tiers". A one tier channel means that vendors IT product manufacturers (or software
publishers) work directly with the dealers. A one tier / two tier channel means that vendors work
directly with dealers and with distributors who sell to dealers. But the most important is the
distributor or wholesaler.
Retailers- Retailers can promote your product by making consumers aware of its availability and by
passing on technical information that could encourage the sale. Because there are thousands of
retailers located all around the country, they are an excellent intermediary for distributing your
product to a wide geographical range of consumers.
Wholesalers- reaching a potentially large number of consumers. The main function of a wholesaler is
to provide a link between the producer (you) and the retailer. Once selling to a wholesaler, there are
three ways that your product will reach the consumer. Firstly, the consumer will purchase directly
from the wholesaler: this is the less common route out of the three. Alternatively, your products will
be sold on by the wholesaler to retailers. The other advantages of selling to a wholesaler are that they
may have strong links with quality retailers: research will help discover this fact. In addition, because

they buy in bulk, it reduces the burden of on-site storage at your premises reducing overhead costs.
The disadvantage of using a wholesaler to distribute your products is that they cannot market your
products extensively. Further, because they buy in bulk, it is often you will sell at a price much lower
than the final retail price.
Direct Distribution-Very common for small businesses, products/services can be sold directly to the
consumer on-site i.e. directly from your shop, office or home by consumers physically coming into the
premises to make a purchase. This can be related with, for example, a village baker or a hand-made
furniture business where the products are made and sold at the same place. Works well only when
the TG is in the local region only
Direct Mail- Also known as a mail shot, this type of marketing can produce sales on a local, national,
or even global, scale. Your business would send out, say, flyers, leaflets, brochures or catalogues (often
targeted to particular consumers) selling your product/service. Any interested receivers of the mail
would make an order through the contact details/order form that would be included. Although very
effective, there is some cost involved but is considerably cheaper compared to other sources of
marketing such as advertising
Telemarketing- Selling your product/service through telemarketing is becoming increasingly popular.
Similar to direct mail, telemarketing allows sales to be made on a local, national and global scale,
although the costs will increase with the time and distance of phone calls.
Internet (E-Commerce)- Sites such as E Bay. Virtual Shopping.
Agents/Brokers- An agent or broker will help sell your product/service, but will not take ownership of
what they are selling at any time. They usually work on commission taking a percentage of the total
sales made by themselves. An agency or brokerage will sell your product or service, for example
insurance, tickets for entertainment, accommodation, etc. Perhaps the most common example of an
agent would be a travel agency. They never own the holidays or credit the full amount of the sale to
their business. Instead, they act as a link between the holiday resort and the consumer, taking a
commission on the sales.
The following types of Channel Memberships are possible:
Intensive distribution - Where the majority of resellers stock the 'product' (with convenience
products, for example, and particularly the brand leaders in consumer goods markets) price
competition may be evident.
Selective distribution - This is the normal pattern (in both consumer and industrial markets) where
'suitable' resellers stock the product.
Exclusive distribution - Only specially selected resellers or authorized dealers (typically only one per
geographical area) are allowed to sell the 'product'.
The marketer must assess the benefits received from utilizing a channel partner versus the cost
incurred for using the services and design the Distribution Channels best suited to his needs.
(Contributed by 2011)

44. What are the recent retail strategies being adopted by big
players in India?
The retail sector can broadly classified into four major categoriesfood and groceries,
consumer durables, apparel, and pharmaceuticals. These together account for almost 60 to 70% of the
total retail market. Of these four categories, food and groceries account for the largest share of 74%,
according to India Brand Equity Foundation (IBEF).
Retail Marketing Strategies in India:

It is the practice of making products in stores available to consumers, primarily by stocking shelves and
displays. Types include: Creating attractive displays (ITC Bingo), Trade shows, Visual display photo
Private Branding
Products (or services) which are generally manufactured or provided by one company under the
retailers brand. Ex: Big Bazaar has its own line of towels and apparels.
While many elements may make up a firms retail marketing mix, the essential elements may include:
Store location
Store image
Store design
Sales incentives
Merchandise assortments
Store ambience
Customer service
Communication with customers
Personal selling
The retail marketing mix must be consistent with the expectations of customers and must be
responsive to competition. The important factors in retail marketing include:
Store location
Target market
Channel structure
Channel management
Retailer image
Retail logistics
Retail distribution
People element
Staff capability

Customer interaction
Internal marketing

45. What can be defined as the luxury market in India?
Luxury retail in India has been a fascinating journey from a socio-economic perspective.
Projected as the next China for luxury goods consumption, the Indian economy has evoked a lot of
interest globally given its statistics of some of the highest disposable incomes and increase in the
number of millionaires.
The last couple of years have seen a profusion of luxury brands into the Indian market: from stand-
alone stores in five star hotels to luxury Malls, these labels which were previously only seen in
international fashion magazines and high streets abroad, were now household names in India. With
one of the highest levels of disposable incomes, the well-traveled Indian luxury consumer is being
wooed by all.
The luxury goods market in India is one of the worlds most diverse and exciting and a challenging
one for brands seeking to gain a presence there. Brands and retailers that want to capture a share
of this fast-paced business need to learn and adapt, or risk missing one of the great untapped
opportunities for the luxury business.

The New Indian Luxury Consumer, of around 1.7 million Indians qualify as rich (sub-definitions are
Super Rich, Sheer Rich, Clear Rich and Near Rich) a figure that is set to more than double in the next
five years. In sharp contrast to consumers in more mature markets, the spending power of Indians
earning between US$20,000 and US$40,000 still puts them on the countrys rich list and makes
them well worth targeting by brands keen to secure an Indian market presence.

Luxury clothing, fragrances, premium footwear, home electronics and high-end watches have
achieved good penetration among male Indian consumers, but items such as cufflinks, belts, wallets,
luxury wines, Champagnes and cigars still rate low on the wish-lists of many Indian men seeking
luxury brands. Among women, jewellery, cosmetics and skincare can already boast high levels of
awareness, followed by categories such as underwear, handbags and mobile phones. Low-penetration
sectors that are yet to make an impact include gourmet food, tableware and imported furniture.
Super-deluxe brands like Porsche, Chanel, Louis Vuitton, Rolls-Royce, Rolex, Bvlgari and others have
entered the market.

The luxury consumer in profile
A profile of the Indian luxury consumer, as per a study by research group KSA Tecnopak:
Primarily resident in urban India
Lives in a household earning more than about INR800,000 (US$18,000) a year, where the chief
earner is male, average age 3637

Owns a premium/luxury saloon car such as a Honda Accord, a Vectra, a Skoda Octavia etc.
Among women consumers, 65% are housewives
Most are educated to post-graduate level
Incidence of foreign travel is 53%, 44% travelling abroad for holidays at least once a year.

Luxury households can also be categorised into segments according to their attitudes to
luxury goods purchasing:
The Arrived: This is the most affluent group, comprising 49% of the target audience of luxury
goods companies.
The Actualised Ascetic: This group comprises largely self-made men, professionals or
businesspeople who are in their late 40s or early 50s. This is the smallest group (15% of the
target audience).
The Climbers: As the name suggests, this group wants to project a lifestyle image that will gain
them acceptance into the higher echelons of society, yet many lack the discernment that
comes with exposure to luxury brands and wealth over a long period. These are 19% of the
target universe for luxury brands, says the study.
The Laggards: Although well-heeled and targeted by luxury brands, this group remains
nonchalant about luxury goods consumption. This group comprises a high proportion of
college drop-outs and graduates who are in business or work as office executives. This group is
17% of the target consumer base.
(Contributed by Nazia Asad 2012)

46. What is a Brand?

A brand is the identity of a specific product, service, or business. It is basically the perception
the consumers have about the product. A brand can take many forms, including a name, sign, symbol,
color combination or slogan. It is the emotional and psychological relationship you have with your
customers. A legally protected brand name is called a trademark. Eg: Coca Cola, Apple

A brand is a name or trademark connected with a product or producer. Brands have become
increasingly important components of culture and the economy, now being described as "cultural
accessories and personal philosophies".
Some people distinguish the psychological aspect of a brand from the experiential aspect. The
experiential aspect consists of the sum of all points of contact with the brand and is known as
the brand experience. The psychological aspect, sometimes referred to as the brand image, is a
symbolic construct created within the minds of people and consists of all the information and
expectations associated with a product or service.
Brand name
The brand name is often used interchangeably within "brand", although it is more correctly used to
specifically denote written or spoken linguistic elements of any product. In this context a "brand
name" constitutes a type of trademark, if the brand name exclusively identifies the brand owner as
the commercial source of products or services.
Brand identity
A product identity, or brand image are typically the attributes one associates with a brand, how the

brand owner wants the consumer to perceive the brand - and by extension the branded company,
organization, product or service. The brand owner will seek to bridge the gap between the brand
image and the brand identity. Effective brand names build a connection between the brand personality
as it is perceived by the target audience and the actual product/service. The brand name should be
conceptually on target with the product/service (what the company stands for). Furthermore, the
brand name should be on target with the brand demographic. Typically, sustainable brand names are
easy to remember, transcend trends and have positive connotations. Brand identity is fundamental to
consumer recognition and symbolizes the brand's differentiation from competitors.

(Contributed by Sanchit Sawhney 2012; 2011)

47. What is Brand Extension?
Brand extension is a part of brand management to diversify and leveraging the existing brand
by entering into new product category by new product development. A firm uses an established brand
to introduce a new product, the product is called a brand extension.
Its advantages are:
It helps in enhancing parent brand image.
It helps in avoiding risk of developing new names.
Brand extension poses more risk than line extension. Its major disadvantages are:
Poorly executed extension of brand to new product categories can jeopardize current image
of parent brand.
The image and financial figures of parent brand may be endangered due to the failure of
strategy implementation.
It cannibalizes sales of the parent brand.
Harley Davidson bikes, later ventured into bike accessories.
Maggi in soups, noodles, sauces
Horliks Foodle
(Contributed by Tarun Avtar Arya, Sukesh Chandra Gain - 2012)

48. What is competitive advantage?
Competitive advantage is a position of a company in a competitive landscape that allows the
company earning return on investments higher than the cost.
Competitive Advantage - Definition
A competitive advantage is an advantage over competitors gained by offering consumers greater
value, either by means of lower prices or by providing greater benefits and service that justifies higher
Competitive Strategies
Following on from his work analysing the competitive forces in an industry, Michael Porter suggested
four "generic" business strategies that could be adopted in order to gain competitive advantage. The
four strategies relate to the extent to which the scope of a businesses' activities are narrow versus
broad and the extent to which a business seeks to differentiate its products.

The four strategies are summarised in the figure below:

The differentiation and cost leadership strategies seek competitive advantage in a broad range of
market or industry segments. By contrast, the differentiation focus and cost focus strategies are
adopted in a narrow market or industry.
Strategy - Differentiation
This strategy involves selecting one or more criteria used by buyers in a market - and then positioning
the business uniquely to meet those criteria. This strategy is usually associated with charging a
premium price for the product - often to reflect the higher production costs and extra value-added
features provided for the consumer. Differentiation is about charging a premium price that more than
covers the additional production costs, and about giving customers clear reasons to prefer the product
over other, less differentiated products.
Examples of Differentiation Strategy: Mercedes cars; Bang & Olufsen
Strategy - Cost Leadership
With this strategy, the objective is to become the lowest-cost producer in the industry. Many (perhaps
all) market segments in the industry are supplied with the emphasis placed minimising costs. If the
achieved selling price can at least equal (or near)the average for the market, then the lowest-cost
producer will (in theory) enjoy the best profits. This strategy is usually associated with large-scale
businesses offering "standard" products with relatively little differentiation that are perfectly
acceptable to the majority of customers. Occasionally, a low-cost leader will also discount its product
to maximise sales, particularly if it has a significant cost advantage over the competition and, in doing
so, it can further increase its market share.
Examples of Cost Leadership: Nissan; Tesco; Dell Computers

Strategy - Differentiation Focus
In the differentiation focus strategy, a business aims to differentiate within just one or a small number
of target market segments. The special customer needs of the segment mean that there are
opportunities to provide products that are clearly different from competitors who may be targeting a
broader group of customers. The important issue for any business adopting this strategy is to ensure
that customers really do have different needs and wants - in other words that there is a valid basis for
differentiation - and that existing competitor products are not meeting those needs and wants.
Examples of Differentiation Focus: any successful niche retailers; (e.g. The Perfume Shop); or specialist
holiday operator (e.g. Carrier)
Strategy - Cost Focus
Here a business seeks a lower-cost advantage in just on or a small number of market segments. The
product will be basic - perhaps a similar product to the higher-priced and featured market leader, but
acceptable to sufficient consumers. Such products are often called "me-too's".
Examples of Cost Focus: Many smaller retailers featuring own-label or discounted label products.

Examples: Toyota - quality
Mc Donalds - value for money & service

(Contributed by Nupur Jain 2012; 2011)

49. What is defined as BOP Market? (Ref : CK Prahlads original
document) ?
The bottom of the pyramid is the largest, but poorest socio-economic group. Although they
dont have a high purchasing power parity ,but by their sheer number there is a lot of money in the
market. Contrary to the popular view, BOP consumers are getting connected and networked. They are
rapidly exploiting the benefits of information networks. Distribution access to the BOP markets is very
difficult and therefore represents a major impediment for the participation of large firms and MNCs.
Initiative like E-choupal is a part of it.
(Contributed by Sanchit Sawhney - 2012)

50. What is innovation? Give Example of disruptive innovation
Disruptive innovation is a term used in business and technology literature to describe
innovations that improve a product or service in ways that the market does not expect, typically by
lowering price or designing for a different set of consumers.

A disruptive technology or disruptive innovation is a term describing a technological innovation,
product, or service that uses a "disruptive" strategy, rather than an "evolutionary" or "sustaining"
strategy, to overturn the existing dominant technologies or status quo products in a market. Disruptive
innovations can be broadly classified into low-end and new-market disruptive innovations. A new-
market disruptive innovation is often aimed at non-consumption, whereas a lower-end disruptive

innovation is aimed at mainstream customers who were ignored by established companies. It has
been systematically shown to the research community that most disruptive innovations are in a
minority compared to revolutionary innovations which introduce an innovation of higher performance
to the market. Examples of true disruptive innovations, i.e. innovations that are lower in performance
and lower cost, succeeding are rare.

Christensen distinguishes between "low-end disruption" which targets customers who do not need
the full performance valued by customers at the high-end of the market and "new-market disruption"
which targets customers who have needs that were previously unserved by existing incumbents.

"Low-end disruption" occurs when the rate at which products improve exceeds the rate at which
customers can adopt the new performance. Therefore, at some point the performance of the product
overshoots the needs of certain customer segments. At this point, a disruptive technology may enter
the market and provide a product which has lower performance than the incumbent but which
exceeds the requirements of certain segments, thereby gaining a foothold in the market.

In low-end disruption, the disruptor is focused initially on serving the least profitable
customer, who is happy with a good enough product. This type of customer is not willing to pay
premium for enhancements in product functionality.
"New market disruption" occurs when a product fits a new or emerging market segment that is not
being served by existing incumbents in the industry. The Linux operating system (OS) when introduced
was inferior in performance to other server operating systems like Unix and Windows NT. But the
Linux OS is inexpensive compared to other server operating systems. After years of improvements
Linux is now installed in 84.6% of the worlds 500 fastest supercomputers.
Innovations in marketing:
Sprite 250 ml
TVS Scooty balancing wheels
Fairness meter
Disruptive innovations:
In storage space industry- floppies to cds, cds being challenged by usb drives and mp3 players
Ceat caught unaware by JK Tyres invention of radial tyres- leading to a drastic fall in market
share in the car segment.
(Contributed by Sanchit Sawhney 2012; 2011)

51. What is integrated marketing communication?
A management concept that is designed to make all aspects of marketing communication such
as advertising, sales promotion, public relations, and direct marketing work together as a unified force,
rather than permitting each to work in isolation so that they speak consistently with one voice all the
time, every time. For example, if a company markets its product as being customer friendly, it should
be reflected in all aspects starting from any phone conversation with them and friendly salesman at

the store location to prompt after-sales service.
IMC creates competitive advantage, boost sales and profits, while saving money, time and stress.
IMC wraps communications around customers and helps them move through the various stages of the
buying process. The organisation simultaneously consolidates its image, develops a dialogue and
nurtures its relationship with customers.
This 'Relationship Marketing' cements a bond of loyalty with customers which can protect them from
the inevitable onslaught of competition.
IMC also increases profits through increased effectiveness. At its most basic level, a unified message
has more impact than a disjointed myriad of messages. In a busy world, a consistent, consolidated and
crystal clear message has a better chance of cutting through the 'noise' of other messages
At another level, initial research suggests that images shared in advertising and direct mail boost both
advertising awareness and mail shot responses. So IMC can boost sales by stretching messages across
several communications tools to create more avenues for customers to become aware, aroused, and
ultimately, to make a purchase
Carefully linked messages also help buyers by giving timely reminders, updated information and
special offers which, when presented in a planned sequence, help them move comfortably through
the stages of their buying process.
IMC also makes messages more consistent and therefore more credible. This reduces risk in the mind
of the buyer which, in turn, shortens the search process and helps to dictate the outcome of brand
Finally, IMC saves money as it eliminates duplication in areas such as graphics and photography since
they can be shared and used in say, advertising, exhibitions and sales literature.

52. What is segmentation? Segmentation Parameters

53. What is so special in marketing of services?
Marketing of services
A service is the action of doing something for someone or something. It is largely intangible
(i.e. not material). A product is tangible (i.e. material) since you can touch it and own it. A service
tends to be an experience that is consumed at the point where it is purchased, and cannot be owned
since is quickly perishes. A person could go to a caf one day and have excellent service, and then
return the next day and have a poor experience. So often marketers talk about the nature of a service

Lack of ownership: Right of ownership is not taken to the service, since you merely experience it. For
example, an engineer may service your air-conditioning, but you do not own the service, the engineer
or his equipment. You cannot sell it on once it has been consumed, and do not take ownership of it.
Intangible: Service is intangible and cannot have a real, physical presence as does a product. For
example, motor insurance may have a certificate, but the financial service itself cannot be touched i.e.

it is intangible.
Inseparable: Service is inseparable from the point where it is consumed, and from the provider of the
service. For example, you cannot take a live theatre performance home to consume it (a DVD of the
same performance would be a product, not a service.
Perishable: Service is perishable in that once it has occurred it cannot be repeated in exactly the same
way. For example, once a 100 metres Olympic final has been run, there will be not other for 4 more
years, and even then it will be staged in a different place with many different finalists
Variability: since the human involvement of service provision means that no two services will be
completely identical. For example, returning to the same garage time and time again for a service on
your car might see different levels of customer satisfaction, or speediness of work.
The marketing mix has seen an extension and adaptation into the extended marketing mix for
services, also known as the 7P's - physical evidence, process and people.
Physical evidence
It is the material part of a service. Strictly speaking there are no physical attributes to a service, so a
consumer tends to rely on material cues. There are many examples of physical evidence, including
some of the following:
Internet/web pages.
Paperwork (such as invoices, tickets and dispatch notes).
Signage (such as those on aircraft and vehicles).
Business cards.
The building itself (such as prestigious offices or scenic headquarters).
Mailboxes and many others
Services marketing is the marketing of processes, deeds and performances, i.e. anything which is
essentially intangible in nature. Marketing a service-base business is different from marketing a goods-
base business.

Some of the major differences, including:
1. Services are more heterogeneous in nature, as compared to products which are more
standardized in nature.
2. Services have to be produced and consumed simultaneously and cannot be stored for future
consumption because of their perishable nature.
3. The buyer purchases are intangible
4. The service may be based on the reputation of a single person
5. its more difficult to compare the quality of similar services
6. The buyer cannot return the service

This criterion of intangibility also differentiates goods from services and underlines the importance of
marketing of services to be managed in a different manner as compared to marketing of products.

Thus, the services marketing is marketing of services while appreciating these differences and adding
additional elements in the tradition marketing mix i.e. the four Ps: product, promotion, pricing and
place (distribution). The expanded marketing mix for services includes: In addition to the 4 ps there
are 3 more Ps added in marketing of services :

An essential ingredient to any service provision is the use of appropriate staff and people. Recruiting
the right staff and training them appropriately in the delivery of their service is essential if the
organisation wants to obtain a form of competitive advantage. Consumers make judgements and
deliver perceptions of the service based on the employees they interact with. Staff should have the
appropriate interpersonal skills, aptititude, and service knowledge to provide the service that
consumers are paying for. Many British organisations aim to apply for the Investors In People
accreditation, which tells consumers that staff are taken care off by the company and they are trained
to certain standards.

Refers to the systems used to assist the organisation in delivering the service. Imagine you walk into
Burger King and you order a Whopper Meal and you get it delivered within 2 minutes. What was the
process that allowed you to obtain an efficient service delivery? Banks that send out Credit Cards
automatically when their customers old one has expired again require an efficient process to identify
expiry dates and renewal. An efficient service that replaces old credit cards will foster consumer
loyalty and confidence in the company.
At each stage of the process, markets:
Deliver value through all elements of the marketing mix. Process, physical evidence and people
enhance services.
Feedback can be taken and the mix can be altered.
Customers are retained, and other serves or products are extended and marked to them.
The process itself can be tailored to the needs of different individuals, experiencing a similar
service at the same time.
Processes essentially have inputs, throughputs and outputs (or outcomes). Marketing adds value to
each of the stages. Take a look at the lesson on value chain analysis to consider a series of processes at

Physical Evidence
Where is the service being delivered? Physical Evidence is the element of the service mix which allows
the consumer again to make judgements on the organisation. If you walk into a restaurant your
expectations are of a clean, friendly environment. On an aircraft if you travel first class you expect
enough room to be able to lie down!

Physical evidence is an essential ingredient of the service mix, consumers will make perceptions based
on their sight of the service provision which will have an impact on the organisations perceptual plan
of the service.
Customer Service: Many products, services and experiences are supported by customer services
teams. Customer services provided expertise (e.g. on the selection of financial services), technical
support (e.g. offering advice on IT and software) and coordinate the customer interface (e.g.
controlling service engineers, or communicating with a salesman). The disposition and attitude of such
people is vitally important to a company. The way in which a complaint is handled can mean the
difference between retaining or losing a customer, or improving or ruining a company's reputation.
Today, customer service can be face-to-face, over the telephone or using the Internet. People tend to
buy from people that they like, and so effective customer service is vital. Customer services can add
value by offering customers technical support and expertise and advice.

Personal Selling: There are different kinds of salesperson. There is the product delivery salesperson.
His or her main task is to deliver the product, and selling is of less importance e.g. fast food, or mail.
The second type is the order taker, and these may be either 'internal' or 'external.' The internal sales
person would take an order by telephone, e-mail or over a counter. The external sales person would
be working in the field. In both cases little selling is done. The next sort of sales person is
the missionary.
Here, as with those missionaries that promote faith, the salesperson builds goodwill with customers
with the longer-term aim of generating orders. Again, actually closing the sale is not of great
importance at this early stage. The forth type is the technical salesperson, e.g. a technical sales
engineer. Their in-depth knowledge supports them as they advise customers on the best purchase for
their needs. Finally, there are creative sellers. Creative sellers work to persuade buyers to give them an
order. This is tough selling, and tends to offer the biggest incentives. The skill is identifying the needs
of a customer and persuading them that they need to satisfy their previously unidentified need by
giving an order.

Training: All customer facing personnel need to be trained and developed to maintain a high quality of
personal service. Training should begin as soon as the individual starts working for an organization
during an induction. The induction will involve the person in the organization's culture for the first
time, as well as briefing him or her on day-to-day policies and procedures. At this very early stage the
training needs of the individual are identified. A training and development plan is constructed for the
individual whom sets out personal goals that can be linked into future appraisals. In practice most
training is either 'on-the-job' or 'off-the-job.' On-the-job training involves training whilst the job is
being performed e.g. training of bar staff. Off-the-job training sees learning taking place at a college,
training centre or conference facility. Attention needs to be paid to Continuing Professional
Development (CPD) where employees see their professional learning as a lifelong process of training
and development.

(Contributed by G. Chandana -2012; 2011)

54. What is the NCAER Classification of consumers in the country?
Consumer Classification
According to National Council of Applied Economic Research (NCAER) there are 5 consumer
classes that differ in their ownership patterns and consumption behaviour across various segments of
Consumer Classes Annual Income in Rs. 1996 2001 2007 Change
The Rich Rs. 215,000 and more 1.2 2.0 6.2 416%
The Consuming Class Rs 45000- 215,000 32.5 54.6 90.9 179%
The Climbers Rs. 22000-45,000 54.1 71.6 74.1 37%
The Aspirants Rs. 16000-22,000 44 28.1 15.3 -65%
The Destitute Below Rs. 16,000 33 23.4 12.8 -61%
Total 164.8 180.7 199.2 21%


The 5 classes of consumer households (consumer classification) show the economic development
across the country based on consumption trends.
The Indian consumer market is not secular in nature. Rural markets are growing at a much faster than
urban markets and rural consumers are largely value for money customers. Markets are growing but
mainly for low-value items.
A study conducted by The National Centre for Applied Economic Research (NCAER) divides Indian
households into five categories based on income, consumption, asset ownership and education level.
The key assumption for such a classification is that consumption, and not income alone differentiates
consumer segments. The five categories are as given below
The very rich account for a miniscule 0.065 m household. This segment is very comparable to
consumers in the developed world and is willing to spend more for greater benefits. They are
consumer of premium category products
The consuming class comprises 30 m households. This class consumes most products, but rarely
expensive, high-end items that offer extra features. This segment also seeks a judicious balance
between categories between benefits and costs with affair amount of elasticity. Consumers in this
class mainly demand mid-price and low-price products, but occasionally indulge in the premium
The climbers comprising of 50 m householder are at the bottom of the consumption ladder. This
segment consists of cash-constrained benefit-maximizes, mainly consuming low-priced and unbranded
The aspirants category consumers comprising of another 50 m households aspire to greater
consumption but need money to achieve their goal. This class too focuses mainly on unbranded

The destitute consumers accounting for 35 m households lead a hand-to-mouth existence.
Households in this segment are below the poverty line and their basic housing and food and clothing,
rather than consumer goods.

Consumer profile
India has a huge population base of around 952 m - almost 3.7X that of the US and around 16% of the
worlds population, growing at around 2% annually. The average per capita income in India is around
US$ 350 or US$ 1,500 in purchasing power parity (PPP) terms.
Around 70% of India is in rural areas. Urbanisation is reducing this proportion, but is projected to rise
from 29% currently to 31% in FY2001. The large rural population makes up roughly 50% of consumer
spending. More important, the average rural per capita income is about US$ 1,100 in PPP terms.
Around 67% of urban India and 35% of rural India watches television, which influences consumer
patterns. The only true national channel is Doordarshan with a penetration of 50%. Private channels
have a predominantly urban viewer base.
(Contributed by 2011)

55. Viral Marketing
Viral Marketing is known as a word of mouth or these days with the increased use of the
internet word of mouse with the objective of marketing the product of a company via tools such as
social media networking sites like Orkut, Facebook, social media sharing sites such as Youtube etc. or
sites which have a social connect such as Twitter, Blogspot etc.
In short it can be defined as any strategy which uses individuals to pass on a marketing message to
others; creating scope for exponential growth in the companys spread of the intended message.
Companies could even use non-internet mediums such as phone SMS etc. t market their products.
The two basic differentiators of viral marketing from other marketing mediums are:
1) It is rather inexpensive in its use and also value for money since at times it may be more
effective a marketing tool than contemporary marketing media. For example: Cadbury using
the Gorilla advertising campaign
2) Its uses the basic tenet of a virus in its spreading i.e. its spreads from one person to another
just as a virus would spread.
Example: When Hotmail started, it used the principles of viral marketing when it sent an
automatic invite to every person who the Hotmail user was sending a mail to, to join Hotmail.
Other prominent examples to explain use of viral marketing are:
1) The million-dollar homepage i.e. the site which sold pixels on its homepage and made
millions out of it.
2) Dove Evolution video- This was a part of a campaign run by Dove to show that models
have artificial beauty and this message via online videos struck a chord with female audiences
3) Ford using the medium of online advertising for their new model Ford Ka (which they had
previously disowned as their ad claiming that some marketing company had done it without
their permission).
Viral Marketing could also be compared to buzz marketing which is yet another form of word of
mouth marketing, that creates a buzz or excitement i.e. like a craze amongst people by spreading
messages in similar ways that viral marketing spreads in.
(Contributed by 2011)

56. What should be Strategy of FMCG companies for getting into
Rural Markets?
Facts of Rural India
No. of Total Villages 690000
72% Part of Indian Population
Caste System plays major role in social status
2 kinds of houses Kaccha House/ Pakka House
Illiteracy 40%
Man is dominating member in Household
Transportation Problem
NAREGA/Indira Gandhi Aawas Yojana/Pradhanmantri Gram Sadak Yojana are few govt.
FMCG Market Size 6500 bn Rs
57.6% Reach of Electricity --- Barriers in Promotion via Television adds
FMCG way to go: The future lies with those companies who see the poor as their customers.
Companies should focus on creative solution and product engineering to reduce their costs and offer
tremendous life time value to the Bottom of the Pyramid customers.
Below putting some successful strategies used by the marketers:
More Features in one Product
HUL developed a combined soap and shampoo that was cost-effective and also less harsh on
hair than ordinary soaps. HUL launched the new soap-cum shampoo Breeze 2-in-1
Value for Money
Nirmas yellow detergent powder launch which took the market from Surf.
Cavinkares Chik shampoo : Cavinkare launched Chik in 50 paise sachets. Cavinkare targeted
rural and small town customers who used soaps to wash their hair. it became the market
leader in the rural markets with over 50% market share. It create a sachet revolution.
Strategy: low unit price packs. (LUP)
Nestle Munch launched in SKU of Rs 2
Nestls Maggi: Nestles rural initiatives have largely been based on Price-led initiatives. Brand
such as Maggi noodles are priced at Rs.5. It helped Nestle in making in roads in to rural
Strategy: small pack - lower price
CSR Activities: Making them aware about purity of water
Free sampling of Farmlands and guidance in their agricultural Issues, Cleanliness of self, society

e.g.: Nikhar in Bihar
HUL Lifebuoy: HUL launched a direct rural contact program called Lifebuoy Swasthya Chetana
campaign, made sales goes up by 20% in 17,000 villages.
Strategy: lifebuoy has always been positioned on the platform of health and Hygiene

Local Touch to ads and use of local language:
Coca-cola: Coca-cola ad thanda matlab coca-cola caught attention of the rural consumers so
much. Aamir khan playing foot sic with village bells.
Strategy: Using a renowned celebrity from in rural background
Coca -Cola is a pioneer company in distribution network. Coca-Cola has evolved a hub and
spoke distribution model for effectively reaching and serving rural markets. Coca-Cola
provides low-cost ice boxes tothe small distributors in rural areas because of the lack of the
electricity. In this marketing strategy a wake up call for cokes rural focus.
Strategy: Coke is available where, even water is not available
HUL: Hindustan unilever, the pioneer and a large player in Indias FMCG market. HUL is the first
company to step into the Indian rural marketing. HUL launched operation stream line,
distributed HULs products in villages using unconventional transport like bullock carts,
tractors and cycles. Today HULs products touch the lives of two out of every three Indians.
Strategy: HUL product can reach a place, where you can not reach
Use of Self Help Group : HUL Shakti Amma
(Contributed by 2011)

57. Word Of Mouth
Word of mouth is a reference to the passing of information from person to person. Originally
the term referred specifically to oral communication (literally words from the mouth), but now
includes any type of human communication, such as face to face, telephone, email, and text

Characteristics of Word of Mouth
Word of mouth also takes many forms online or off-line. Three noteworthy characteristics are:
1. CrediblePeople trust others they know and respect, word of mouth can be highly influential.
2. PersonalWord of mouth can be a very intimate dialogue that reflects personal facts,
opinions, and experiences.
3. Timely It occurs when people want it to and when they are most interested, and it often
follows noteworthy or meaningful events or experiences.
Whose Word of Mouth Matters?
According to Mintel, 34% of US Internet users who bought a product or service based on a
recommendation got that tip from a friend or relative, while one-quarter bought based on advice from
a spouse or domestic partner.
Difference between Word of Mouth and Viral marketing
The major different between word-of-mouth marketing and viral is that word-of-mouth is often driven
by you the marketer or business owner and viral marketing driven by the passion of your consumers
and its success does not depend on you.
Word of mouth and India
In the case of India, 87 per cent of those who use the Internet trust others advice rather than any kind
of advertising, proving that word-of-mouth is the most powerful advertising tool, a press release
issued by the research agency found. Newspapers come second in the most trusted list, with 77 per
cent saying so. Opinions expressed online and on brands Web sites were the third and fourth most
trusted at 73 and 72 per cent, ahead of television, which came fifth as only 65 per cent said they were

India comes fourth among the top ten countries which trust in recommendations from consumers,
with Hong Kong topping the list with 93 per cent. Most of the top ten markets that rely most on
recommendations from consumers are in Asia. They include Taiwan, Indonesia, South Korea and the
Five Word of Mouth Marketing Strategies

Word of Mouth Marketing (WOMM) is a form of promotional campaign which operates through an
individuals personal recommendations of specific brands, products or services.
Like its literal meaning, word-of-mouth marketing spreads from one person to another outside of a
formalized setting, without heavy intervention by advertisers.
A recommendation from someone familiar and trust-worthy is the easiest path to a product sale, link
or new subscriber. This is because, recommendations are generally perceived as incentive-free, unlike
the obvious motivation of advertisers, who may over-promise in a bid to increase sales.
If you want to sell more products, get more affiliate commissions or just gain more new readers or

supporters for your website, word of mouth marketing is one the most powerful ways to do so. What
better way to spread your brand than to have an army of supporters constantly talking about or
referencing it online or offline, through conversations or links?

1. Leverage Existing Social Networks. Online communities have a tightly knit group of users who
can help to increase brand awareness for the product. Tap into these communities with tools or
content targeting their specific sub-culture and you are likely to get a lot of attention.
These can include applications for platform-specific websites like Facebook, Firefox and
Wordpress, which each have a large body of users.
2. Target the Influencers. Look for individuals who are trend-setters or authorities on a specific
topic. They should preferably be individuals who have many personal connections or a large and
loyal audience. If these people spread your message, your website or product will very easily be
disseminated within a targeted group of potential users.
Identify these influencers, build a relationship with them and market through their existing
sphere of social influence. Examples of influencers include celebrities, power users on social
websites and popular webmasters or bloggers with many loyal supporters.

3. Exclusivity and Scarcity. Many websites or businesses launch virally by offering a limited
number of site invites. Some dangle the bait of limited edition products or temporal discounts.
Combine this with influencer marketing and youll have an excellent method to disseminate
brand awareness for new websites, products or services.
Exclusivity invites curiosity and scarce products generate consistent demand and conversation.
Remember how people were incessantly asking for or writing about Gmail, where someone had
to invite you to open an account, a while ago?

4. Micro-Market. While online viral marketing leverages the interconnectedness of the web to
spread unique content or user-supported promotional schemes, micro-marketing focuses on
marketing to the individual by providing highly customizable products.
Nike and Pumas Mongolian Buffet are examples of micro-marketing schemes which allow you
to design and purchase your own unique sneaker online. Micro-marketing can be combined
with scarcity and existing social networks to generate word-of-mouth exposure.

5. Industry Marketing. Instead of focusing directly on customers, focus on the people who can
build your brand. Instead of seeking for thousands of views from a wide audience, make your
mark within a niche community (like Sphinn) to build relationships and leverage-able
Get recommendations from others in the similar industry to be mentioned, promoted or
included in an industry-specific ranking or recommendations list. This builds your overall brand
within a specific niche, which in turns promotes your site to traditional media and buyers
looking in from the outside.
Successful examples
Gmail - Google did no marketing, they spent no money. They created scarcity by giving out
Gmail accounts only to a handful of "power users." Other users who aspired to be like these
power users aspired for a Gmail account and this manifested itself in their bidding for Gmail

invites on eBay. Demand was created by limited supply; the cachet of having a Gmail account
caused the word of mouth, rather than any marketing activities by Google.
Tupperware popularization
Popularization of text messaging (SMS)
Popularization of chat (Instant messaging)

Unsuccessful examples
Hotmail - Hotmail "piggybacked" on personal emails from one person to another to publicize
their free email service. At a time when few people had email, the first and only free email
service in the marketplace was appealing and novel -- hence their rapid adoption and spread.
However, the same "piggybacking" technique currently employed by all free email providers
(except gmail) no longer works. Furthermore, the Hotmail users did not voluntarily pass it on;
they had no choice about Hotmail adding the "sign up" link at the end of their personal emails.
Burger King's Subservient Chicken - Burger King's marketing program called Subservient
Chicken did indeed generate a lot of word of mouth, but the word of mouth was about the
marketing campaign instead of the product that was being marketed. Also, those marketing
efforts which rely on being edgy or on some kind of stunt often fade quickly when the novelty
or edge wears off. Finally, this type of marketing is not reproducible or sustainable since it
won't be edgy the second time around.
McDonald's Lincoln Fry - a fake blog was discovered, and it generated lots of negative word of
mouth and little participation.
58. Distribution Channels of various companies

Extra 1. ATL, BTL, TTL
Below the line (BTL), Above the line (ATL), and Through the Line (TTL), in organizational business and
marketing communications, are advertising techniques.
Promotion can be loosely classified as "above the line" or "below the line".
Promotional activities carried out through mass media, such as television, radio and newspaper, are
classed as above the line promotion.
The terms "below the line" promotion or communications, refers to forms of non-media
communication, even non-media advertising. Below the line promotions are becoming increasingly
important within the communications mix of many companies, not only those involved in FMCG
products, but also for industrial goods.
"Through the line" refers to an advertising strategy involving both above and below the line
communications in which one form of advertising points the target to another form of advertising
thereby crossing the "line". An example would be a TV commercial that says 'come into the store to
sample XYZ product'. In this example, the TV commercial is a form of "above the line" advertising and
once in the store, the target customer is presented with "below the line" promotional material such as
store banners, competition entry forms, etc.

Porters Five Forces
Michael Porter's Five Forces is probably the most famous framework used in preparing for the case
interviews. It has endured as one of the frameworks most talked about by many in and out of the
consulting field. Although the Five Forces is an excellent framework in helping you organize your
thoughts, like any other framework we cover in this guide, its analysis is not complete. The Five Forces
should be used in conjunction with other frameworks to enable you to fully understand the issues at
hand. Further, we only briefly touch on this framework here, but we have included more detailed
material of Porter's work later in this guide.
Five primary forces:
The threat of new entrants
The bargaining power of buyers/customers
The bargaining power of suppliers
The threat of substitute products
Rivalry with competitors

Attractiveness of the market
depends on :
Intense competition allows minimal profit margins
Mild competition allows wider profit margins

Barriers to Entry:
There are a number of factors that determine the degree of difficulty in entering an industry:
Economies of scale
Product differentiation
Capital requirements vs. switching costs

Access to distribution channels
Cost advantages independent of scale
Proprietary product technology
Favorable access to raw materials
Favorable location
Government subsidies
Learning curve
Government policy

Relationship with Buyers:
A buyer group is powerful if:
It is concentrated or purchases large volumes relative to seller's sales
The products it purchases front the industry are standard or undifferentiated
It faces few switching costs
Buyers pose a credible threat of backward integration
The industry's product is unimportant to the quality of the buyer's products or services
The buyer has full information

Relationship with Suppliers:
A supplier group is powerful if:
It is not obliged to contend with other substitute products for sales in the industry
The industry is not an important customer of the supplier group
The supplier group is an important input to the buyer's business
The supplier group's products are differentiated or it has built up switching costs
The supplier group poses a credible threat of forward integration

Substitute Products:
Substitute products that deserve the most attention are those that:
Compete in price with the industry's products
Are produced by industries earning high profits

Rivalry among existing competitors increases if:
Numerous or equally balanced competitors exist
Industry growth is slow
Fixed costs are high
There is lack of differentiation or switching costs
Capacity is augmented in large increments
(Contributed by Sukesh Chandra Gain - 2012)

I take this opportunity with much pleasure to thank all of you who have contributed and have not
contribute through the course of my journey towards producing this guide, especially to my roommate
Nikhil for providing insights and his laptop whenever needed.