Chapter 11 Marketing Solutions
Question - 11 : - Distinguish between convenience product and shopping product.
Answer - 11 : -
| Basis of Comparison | Convenience Product | Shopping Product |
| Demand | These products have a regular demand in the market. | These products have less demand as compared to convenience products. |
| Nature of Products | Includes products that fall under essential commodities. | Includes goods that are durable in nature |
| Unit of Purchase and Price | Available in small units having low unit price and therefore low margin of profit | Products are available in bigger units with high prices for unit which translates to higher profit margins. |
| Nature of Purchase | These products are bought impulsively and without any time and effort | Consumer spend considerable time on purchasing these products |
Answer - 12 : - In marketing, product is a mixture of tangible and intagible attributes which are capable of being exchanged for a value, with ability to satisfy customer needs. Beside physical objects, include services, ideas, persons and places in the concept of product. Thus, product may be defined as anything that can be offered in a market to satisfy a want or need. It is offered for attention, acquisition, use or consumption.
Question - 13 : - Describe the functions of labelling in the marketing of products.
Answer - 13 : -
Label on a product provides detailed information about the product, its contents, methods of use etc. The various functions performed by a label are as follows
(i) Describe the Product and Specify its Contents
One of the most important functions of labels is that it describes the product, its usage, cautions in use etc and specify its contents.
(ii) Identification of the Product or Brand
A label helps in identifying the product or brand e.g., we can easily pick our favourite soap from a number of packages only because of its label.
(iii) Grading of Products
Labels help grading the products into different categories. Sometimes, marketers assign different grades to indicate features or quality of the product e.g., different type of tea is sold by some brands under Yellow, Red and Green label categories.
(iv) Help in Promotion of Products
An important function of label is to aid in promotion of the products. A carefully designed label can attract the customer to purchase. So, many labels provide promotional messages, some show discount or other schemes etc.
(v) Providing Information Required by Law Another important function of labelling is to provide information required by law. e.g., the statutory warning on the package of cigarette or pan masala – ‘Smoking is injurious to health’ or ‘Chewing tobacco causes cancer.’
Question - 14 : - Discuss the role of intermediaries in the distribution of consumer non-durable products.
Answer - 14 : -
The term channels of distribution refers the facilitate to the movement of goods and services and their title between the point of production and point of consumption, by performing a variety of marketing activities. Following are the functions performed by the channels of distribution
(i) Accumulation
It aims at holding the stock to match between the consumer demand and supply condition, warehousing helps in maintaining continuous flow of goods and services.
(ii) Promotion
The marketing channels also help in promoting the demand for the product by displaying demonstrating and participating in various promotional activities organised by the producers.
(iii) Negotiating
The marketing channels are the intermediaries between the producers and the consumers. They attempt to reach final agreement on price and other terms of the offer, so that transfer of ownership is properly affected.
(iv) Risk Taking
Risk taking is the basic responsibility of the intermediaries. It may arise out of physical deteriorations, changes in price levels, natural calamities, change in fashion etc. These are unaviodable as they hold sufficiently large and variety of inventories till the sale of stock.
(v) Grading/Sorting
Grading is the process whereby they sort the products on the basis of different sizes, qualities, moisture contents and so on. It helps us realising the time value for the product and at the same time ultimate consumer feels satisfied with the uniform quality of the product.
(vi) Packaging
The products are packed in the small tradable lots for the convenience of the consumer.
(vii) Assembling/Assortment
Marketing channels aim at satisfying the needs of the customers. The products desired by the consumer may not be available in the market. They procure such goods from different sources, assemble or assort them as per the requirements of the consumers.
Question - 15 : - Explain the factors determining choice of channels of distribution.
Answer - 15 : -
The choice of channels depend on various factors, which are discussed as follows
(i) Product Related Factors The important product related considerations is deciding the channels. It includes whether the ‘ product is an industrial product or a consumer product. Industrial product require shorter channel and consumer products require longer channel.
(ii) Company Characteristics
The important company characteristics affecting the choice of channels of distribution include the financial strength of the company and the degree of control it wants to hold on other channel member. Direct selling involves lot of foods to be invested in fixed assets say starting own retail outlets or engaging large number of sales force. Similarly if the management want to have greater control on the channel number, short channels are used but if the management do not want more control over the middlemen, it can go in for longer channel or large number of intermediaries.
(iii) Competitive Factors
The choice of channel is also affected by what the competitor has selected as its channel. Sometimes, firm may decide to go for the same channel and sometimes absolutely opposite.
(iv) Market Factors
Important market factors affecting the choice of channel of distribution include size of market, geographical concentration of potential buyers and quantity purchased.
(v) Environmental Factors
Sometimes environmental factors also helps in deciding the channel of distribution, e.g., in a depressed economy, marketers use shorter channels to distribute their goods in an economical way
Question - 16 : - Explain briefly the components of physical distribution.
Answer - 16 : -
The main components of physical distribution are as follows’
(i) Order Processing
If a firm takes more time to process the order, then the consumer remains dissatisfied. Therefore, order processing has to made faster by using information technology.
(ii) Inventory Control
Inventories ensure the availability of the product as and when consumer demand arises. There are various factors which influence a firm decision regarding the level of inventory e.g., degree of accuracy of sales forecast, cost of blocking of the working capital etc.
(iii) Warehousing
It refers to the storage of goods from the time of production to the time of consumption. Warehousing is important as it creates time utility.
(iv) Transportation
It creates place utility. It refers to the carrying of raw materials or finished goods from one place to another. The most important thing to be kept in mind is that the value addition by transportation should be greater than the cost of transportation
Question - 17 : - Define advertising, what are its main features? Explain.
Answer - 17 : -
Advertising is defined as the impersonal form of communication which is paid form by the marketer to promote some goods or services. It is commonly use as the promotional tool of the company. The important features of advertising are as follows
(i) Paid Form Advertising is a paid form of communication which means the sponsor has to bear the cost of communication with the prospects.
(ii) Impersonality There is no direct face to face contact between the prospect and advertiser. It is therefore, referred as the impersonal method of promotion.
(iii) Identified Sponsor Advertising is undertaken by some identified individual or company, who makes the advertising efforts and also bears the cost of it.
Question - 18 : - Discuss the role of ‘Sales Promotion’ as an element of promotion mix.
Answer - 18 : -
Sales promotion includes those marketing activities other than personal selling, advertising and publicity that stimulate consumer purchasing and dealer effectiveness, such as display, shows and exhibitions, demonstrations and various non-current selling efforts not in the ordinary routine. The main objectives of sales promotion activities are
(i) Creation of demand for the product.
(ii) Educating the consumers about new products or new uses of the old product.
(iii) Building the brand loyalty for the product among the consumers.
Question - 19 : - What is the marketing concept? How does it help in the effective marketing of goods and services?
Answer - 19 : -
Orientation of marketing implies that focus on the satisfaction of customers need, is the key to the success of any organisation in the market. All the decisions in the firm are taken from the point of view of the customers, e.g., What product will be produced, with what features and at what price shall it be sold or where shall it be made available for sale will depend on what do the customer wants.
Marketing concept helps in effective marketing of goods and services by using the following
(i) Identification of market or customer who are chosen as the target of
(ii) Understanding needs and wants of customers in the target market.
(iii) Development of products or services for satisfying needs of the target market.
(iv) Satisfying needs of target market better than the competitors.
(v) Doing all this at a profit.
Question - 20 : - What is marketing mix? What are its main elements? Explain.
Answer - 20 : -
Marketing mix refers to the combination of four basic elements known as four P’s — Product, Price, Promotion and Place.
Product Mix
(i)Product mix basically concerns with the features related to a product e.g., range, quality, size, labelling, packaging, branding etc. All products must satisfy consumer needs and expectations. It aims at providing good quality products at fair prices.
(ii)Price Mix
It includes decisions relating to price determination, discounts and allowances credit terms. It covers pricing objectives and pricing policies. Price should cover not only cost of production and selling expenses but also a reasonable profit margin. The price policy adopted by the enterprise should not only be cost based but also demand based and competition based.
(iii) Place Mix
Place mix links the seller and buyer. The choice of channels of distribution and transport are the two major issues here. There are various factors which help in deciding the channel e.g., the time and the place, where the goods have to reach or transportation.
It is the nature of goods, place of destination, cost and availability etc.
(iv) Promotion Mix
It refers to all marketing activities to increase the volume of sales of the product of an enterprise. It consists of means of marketing communication with a view to informing and persuading the prospective buyers to buy a certain product. It includes advertising, personal selling, publicity and sales promotion.