[AHSEC Class 12, Business Studies Notes, Revised Syllabus, 2022 Exam, Marketing Management]
Class 12 Business Studies Notes
Unit – XI:
Marketing
Objective Questions (1 Mark):
1. Define market in Traditional
marketing sense?
Ans: Traditionally market was defined as a place where buyers and
sellers meet each other and conduct buying and selling activities. But in
modern time, the term market has a broader meaning. Market refers to the whole
of any region in which buyers and sellers are brought into contact with one
another and by means of which the prices of the goods tend to be equalized
easily and quickly.
2. Define Marketing. 2012
Ans: Marketing is the process of exchange of goods and services
and includes all those activities which helps in exchange of goods and
services.
3. What is marketing research?
Ans: It means application of resource of research process in
solving the marketing problem.
4. What is marketing mix and its 4 P’s? 2013
Ans: It refers to the combination of four basic elements product,
price, promotion and the place, known as the four P’s of marketing.
5. What is trademark? 2014, 2020
Ans: Trademark simply means mark of a trade carried on by an
identified entity. It is usually a sign mark or a symbol, word or words.
6. What is a product?
Ans: It means good or services or anything of value which is
offered to the market for exchange.
7. What is advertising?
Ans: It is an impersonal form of communication which is paid for
by the markets to promote some goods or services.
8. Define sales promotion?
Ans: Sales promotion refers to short term incentives other than
advertising and personal selling at stimulating markets demand for product.
9. What is package?
Ans: The container which carries the product is called package.
10. What is packaging?
Ans: Packaging is defined as a set of tasks or activities which is
concerned with the design and production of an appropriate container for the
product
11. What is Marketing Management?
Ans: Marketing management is an important functional area of
business. It is the process of planning, organizing, directing and controlling
the activities related to marketing of goods and services to satisfy customer’s
needs & achieve organisational goals.
12. Which Marketing philosophy gives
more importance to “Consumer welfare” instead of “Consumer Satisfaction”?
Ans: Societal marketing 2015
13. Name the function concerned with
informing the customer about the product.
Ans: Product
Promotion
14. Name the function involved in
physical movement of goods from one place to another.
Ans: Physical Distribution
15. Give two examples of Trade
Promotion?
Ans: Gifts, trade discount.
16. What is labeling?
Ans: A label is the identity of product or brand. Labels are
attached one to the product package to help the identification and provide some
identity to the customer.
17. What do you mean by Brand?
Ans: It can be designed as the process of using a name term,
symbol or design to identify a product. It is simply giving a name / a sign / a
symbol etc to a product.
18. Give two examples of Brand.
Ans: Pepsi, Nike.
19. Give the main concept behind the
various types of marketing concept.
|
Name of Concept |
Main points |
|
Production Concept |
Goods/services are cheap
and they can be made available at many places. |
|
Product Concept |
Quality of goods or
services is of good standard. |
|
Selling Concept |
“Goods are not bought but they have to be
sold” |
|
Marketing Concept |
Consumers Satisfaction |
|
Societal Marketing Concept |
Consumer Welfare/Societal
Welfare |
20. Give two examples of trade mark.
Ans: McDonalds, APPLE, IBM
21. Give two examples of various types
of products.
|
Type of
Products |
Examples |
|
Convenience product |
Candy, Newspapers, Soap, Fast Food etc. |
|
Shopping Product |
Clothing,
Furniture, Major Appliances, Used Cars |
|
Speciality product |
Photographic
equipment with high price, Designer clothes |
|
Unsought Products |
Life Insurance, Blood donation to Red Cross |
22. Name the middlemen involved in two
level channels.
Ans: Wholesaler and retailer
23. What is modern marketing concept?
Ans: Modern marketing concept: Modern or new concept of marketing
is a broader concept. It does not mean to provide consumer goods and services
what the seller manufactures but it consists the process of discovering the
consumer and converting their wants into appropriate goods and services.
24. Introducing a scheme of 50% + 40%
less by the koutons is the example of which sales promotion techniques.
Ans: Trade discount
25. Name the products whose utility
gets finished in one use.
Ans: Consumer Products
26.
Mention on objective of pricing.
Ans: One
of the objectives of pricing is to maximize current profits.
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ALSO READ (AHSEC ASSAM BOARD CLASS 12)
1. AHSEC CLASS 12 BUSINESS STUDIES CHAPTERWISE NOTES
2. AHSEC CLASS 12 BUSINESS STUDIES QUESTION PAPERS (FROM 2012 TILL DATE)
3. AHSEC CLASS 12 BUSINESS STUDIES SOLVED QUESTION PAPERS (FROM 2012 TILL DATE)
4. AHSEC CLASS 12 BUSINESS STUDIES IMPORTANT QUESTIONS
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SHORT
QUESTIONS (2/3/5/8 Marks)
1. What is Marketing? What are the
important features of Marketing?
Ans: Marketing is the process of exchange of goods and services
and includes all those activities which helps in exchange of goods and
services. In the words of Philip Kotler, “Marketing is human activity directed
at satisfying needs and want through exchange process.”
Nature of marketing
Buyer and seller affect the demand for
products in aggregate areas, market includes both the place and region which
buyers and sellers are in a free inter course with another.
1)
Marketing is a customer focus: Market intense to satisfy and delight
the customer, the activities of marketing must be directed and focused at the
customer marketers can remain in customers mind. As they are provided value for
what they spend.
2)
Marketing must deliver value: Marketer has to track customer needs and
deliver the product as per their requirement. The co operate storage must be
aimed at delivering greater customer value than competitors.
3)
Marketing is business: When a customer is the focus of all
activities the marketer has not to search customer to see response to his
product. Customer group is decided from whom the product is prepared and
presented.
4)
Marketing is surrounded by customer need: Marketing starts with identification
of customer needs and requirements’. These are termed into probable features
that might satisfy the basic needs
5)
Marketing is a part of total environment: Total environment mainly defined as
the combination of all resources and institutions which are directly related to
the production, distribution of goods, services, ideas, places and persons for
satisfaction of human needs.
2. What are various functions of
Marketing? 2012, 2014, 2018, 2020
Ans: Functions of Marketing / Marketing activities
a) Marketing research : Marketing research means Gathering and
analysing marketing information i.e. what the customers want to buy, when they
are likely to buy in what quantities do they buy, from where do they buy etc.
b) Marketing planning: Specific plan for increasing the level of
production, promotion of the products etc must be designed and the action
programmes are formulated to achieve these objectives.
c) Product designing and development: Marketer must take decision
like, what to product? Which model? What will be the size? Brand name?
Packaging quality? Quality level of product? So that customer needs are
satisfied.
d) Buying and assembling: Buying of raw materials and assembling them
into finished product is an important function of marketing manager.
e) Packing and labeling: Packaging is an essential ingredient for the
promotion and marketing of any product. Marketing manager must decide the
packaging quality and labeling before starting selling of products.
f) Branding: Creating a distinct identity of the product from that of
competitors e.g. Videocon washing machine is an important function. A good
brand helps any product to survive in the competitive market.
3. Differentiate between Marketing and
Selling. Or Selling is Product oriented and Marketing is Customer orientated.
Explain. 2014, 2017
Ans: Difference between
selling & marketing concept
|
Selling |
Marketing |
|
Selling starts with the seller and the needs
of the seller. |
Marketing starts with the buyer and the needs
of buyer |
|
Seeks to quickly convert products into cash. |
Seeks to convert customer ‘needs’ into
products |
|
Seller is the centre of business universe. |
Buyer is the centre of the business universe. |
|
Views Business as a goods producing process. |
Views businesses as a customer satisfying
process. |
|
Seller preference determines the formulation
of marketing mix. |
Buyer determines the shape marketing mix
should take. |
|
Selling is product oriented. |
Marketing is customer oriented. |
|
Seller’s motives dominate marketing
communication. |
Marketing communication is looked upon as a
tool for communicating the benefits / satisfactions provided by the product. |
4. Write a Brief note on traditional
and modern marketing concept.
Ans: Traditional concept of marketing
According to this concept, marketing consists
of those activities which are concerned with the transfer of ownership of goods
from producers to consumers. Thus, marketing means selling of goods and
services. In other words, it is the process by which goods are made available
to ultimate consumers from their place of origin. The traditional concept of
marketing corresponds to the general notion of marketing, which means selling
goods and services after they have been produced. The emphasis of marketing is
on sale of goods and services. Consumer satisfaction is not given adequate
emphasis. Viewed in this way, marketing is regarded as production/sales
oriented.
Modern concept of marketing
According to the modern concept, marketing is
concerned with creation of customers. Creation of customers means
identification of consumer needs and organising business to satisfy these
needs. Marketing in the modern sense involves decisions regarding the following
matters:
1. Products to be produced
2. Prices to be charged from customers
3. Promotional techniques to be adopted to
contact and influence existing and potential customers.
4. Selection of middlemen to be used to
distribute goods and services.
Modern concept of marketing requires all the
above decisions to be taken after due consideration of consumer needs and their
satisfaction. The business objective of earning profit is sought to be achieved
through provision of consumer satisfaction. This concept of marketing is
regarded as consumer oriented as the emphasis of business is laid on consumer
needs and their satisfaction.
From the above discussion, the following
differences between these two concepts are drawn:
|
Traditional
Concept |
Modern Concept |
|
Traditional
marketing emphasis on selling and more profit. |
While, modern
marketing emphasis on profit as well as consumer satisfaction. |
|
Traditional
marketing is start from production and end with sell. |
But in modern
marketing it includes planning, product, price,
promotion, place and after sell services. |
|
In traditional
marketing the manufacturer sell only those products which he produce and not
focused on consumer preference. |
But in modern
marketing manufacturer analyse the consumer demand then produce. |
|
Traditional
marketing concentrate on favourable products. |
But modern marketing concentrate on customer
needs wants and satisfaction. |
Six
Fundamental concept of Marketing are:
There are six concept of marketing which the
companies keep in mind:
i)
Production concept: The production concept is one of the oldest
concepts in business. It holds that consumers will prefer products that are
widely available and inexpensive. So, production concept oriented business
concentrate on achieving high production which reduces cost and focus on mass
distribution.
ii) Product
concept: This concept holds that consumers will prefer those products that
are high in quality and performance and with innovative features. Managers in
these organization focus on making superior products and improving them. But
the marketer must keep in mind that the customers will buy the best quality
product only when they need or want it.
iii)
Selling concept: Now a days, as the technology advances along
with the quantity and quality of the goods, the art of selling the goods are
also very essential. The firms which follow the selling concept believe that in
order to motivate a customer to buy his product, he must be convinced by
aggressive selling and promotional efforts. Firms following selling concept
make use of advertising powers and other persuation techniques to influence the
customers.
iv)
Marketing Concept: The marketing concept emerged in the mid
1950’s. The business generally shifted from a product – centered, make and sell
philosophy, to a customer centered, sense and respond philosophy. The marketing
concept concentrates on the need of the customers. This concept says than
product should be designed and produced keeping in mind the need of the
customers and try to satisfy the need better than the competitor. The marketing
concept holds that the key to achieving organizational goals consist of the
company being more effective than competitors in creating, delivering and communicating superior customers value. This
concept puts the customers at both the beginning and the end of the business cycle.
Every department and every worker should think about the customer and acts as
per need of the customer.
v)
Consumer concept: As per this concept, companies’ aims at
providing consumers separate offers or services. This is possible through one
to one marketing.
vi)
Societal marketing concept: A company must not blindly follow the goal of
customer satisfaction because it may lead to many social and environmental ills
for example, a customer may want to have drugs so just to satisfy customer the
firms should not supply him drugs. This concept requires that company should
deliver superior value to the consumer to improve the consumer and the society.
It focuses on consumer welfare. Firms should not produce harmful products.
5. What is marketing mix? What are its
elements (4 P’s)? What are its features?
2012, 2013, 2017
Ans: Marketing mix refers to one of the major concept in modern
marketing. According to Philip kotler “marketing mix is a set of controllable
marketing variables that the firm blends to produce the response it wants in
the target market”. It is the combination of four controllable variables which
constitutes the company’s marketing system .the four controllable variables
are:
1) The product
2) The price structure
3) The promotional activities
4) The distribution system
These elements are inter related and
inter dependent since decisions in one area usually actions in other area.
Features of marketing mix:
1) Combination of four controllable variables:
Marketing mix is the combination of four variables inputs namely product,
price, promotion and place that constitute the core of organizations marketing
system
2) Inter relation of variables: The four P’s
of marketing mix are interrelated and independent as the decision of one area
automatically depends upon the other.
3) Managerial activity: Marketing mix is a
managerial activity i.e. it is the responsibility of the marketing manager to
combine the four ingredients in the right proportion as to achieve optimum
results.
4) Dynamic concept: Marketing mix is a dynamic
concept as there is need of continuous changes as per the changes taking place
in the marketing environment.
5) Consumer orientation: All marketing
activities are directed towards consumer satisfaction therefore marketing mix
variables need to be flexible to adopt the needs expectation, purchasing power
and buying behavior of the consumer.
6) Target oriented: It is one of the important
components of marketing mix centers around the consumer and his welfare.
6. Explain 4 P’s of Marketing Mix or
various elements of marketing mix. 2012,
2013, 2014, 2017, 2019
Ans:
4 P’s of Marketing Mix:
1.
Product: Product is one of important part of marketing mix because it
reflects the good or bad reputation of any organization. The products
represent any business efficiently. Successful organizations always
search out the buying habits of their customers and designed their products
based on those buying habits in order to meet the customer’s requirements. They
also design their products based on important factors such as purchasing power
and geographical locations etc.
2. Price: It is the worth of product on which customers
are agreed to buy the products. Price of the product should be according
to the range of regular customers. Prices are fluctuating according to
seasonal requirements. Marketers always try to satisfy their clients at any
cost.
3. Place: Products always design based on geographical
place because customers buy products according to their traditions and seasons.
Companies which are going to spread their business networks throughout
the world must visit the place where they want to open their branches. They
need to study the traditions and seasonal changes of the country where they
want to initialize their products.
4. Promotion: Promotion activities involve
marketing and advertising. Promotional activities are used to create
awareness about the products. Customers know about products and their
specification through social marketing media. Companies adopt social marketing
media in order to create awareness about their products and services.
Promotional activities and techniques are important if companies
initialize new products or make some changes in product’s specifications.
Promotional activities include advertising, selling, public relations and sales
promotions.
7. What is product? What are its features?
Mention its various classes.
Ans: It means good or services or anything
of value which is offered to the market for exchange. A product is a set of tangible and intangible attributes including
packaging, colour, price, quality and brand plus the services and reputation of
the seller. A product may be a tangible goods, service, place, person or idea.
Essential features can be identified as given below:
From the above definitions,
some of essential features can be identified as given below:
(a) Tangibility: To be a product, it should
have a tangibility character such as it can be touched or seen, for example a
car, building, cloth etc.
(b) Intangible Attributes: The product may also
be intangible in the form of services for instance, banking, insurance, music
composition, repairing, nursing etc.
(c) Associated Attributes: A product may have
number of features which differentiate it from competitor’s products.
Associated attributes usually cover the colour, package, brand name,
installation instruction etc
(d) Exchange Value: A product may be tangible or
intangible but it must have exchange value. It must be capable of being
exchanged between seller and buyer at mutual agreed price.
(e) Consumer satisfaction: A product should
have the capacity to satisfy consumer’s real or psychological needs and wants.
At the same time, it must have capacity to generate profit for the satisfaction
of sellers.
Classification
of Products
Classification of Products
Broadly products can be classified into
following categories.
(A) Products
based on uses:
(1)
Consumer Products: These are the products or services that are
meant for final consumers for their personal, family or house hold use. These
products are used by buyer for their consumption or selling but not for further
processing. For example pen, watch, books, newspaper etc. Consumer products are
further classified as below:
(a)
Convenience goods: These products or services are purchased with
minimum efforts. Features of such products are purchased at convenient
location, full knowledge of product, continuous and regular demand, highly
standardised etc. For example bread, newspaper etc.
(b)
Emergency goods: Goods required meeting the urgent needs and
so the purchasers do not get time for selection. For example needs of umbrella
during raining season, repairing of T.V. during world cup cricket etc.
(c)
Impulse goods: The consumer is not usually pre-planned or predetermined to
purchase such goods but during shopping all of a sudden he decides to purchase
this type of goods because of product exposure or attraction. For example
chocolate, balloon, a new type of ball pen etc.
(d)
Shopping Goods: These goods are consumer durable item and so he/she selects or
purchases these goods only after making comparisons on such bases as suitability,
quality, price, style and durability. Examples: T.V., Furniture, mobile
hand-set etc.
(e)
Specialty Goods: These products are particular brands, stores
and persons to which consumers are loyal. For Example - Branded surgical
instruments for doctors, life saving drugs, Bhupen Hazarika as a singer, Peter
England dresses etc.
(f)
Unsought Products: The buyers do not know about the existence of
product or they do not want to purchase. It may be regularly unsought product
such as service of life insurance company, a layer’s service, safety alarm etc.
or/and new unsought products which are completely new products and unfamiliar
to consumers.
(2)
Industrial Products: Goods which are used for commercial
production or in carrying of some business activities are known as industrial
goods. It is for commercial use not for personal use. The same product may be
consumer product as well as industrial product depending on its purpose of use.
For example: Rice when we cook and eat at home, it is consumer products and when
the same is sold in a restaurant or hotel, it is treated as industrial goods.
Industrial buyers are mostly rational buyer, i.e. they are cost, quality and
standard conscious. The various types of industrial goods are discussed below:
(a)
Installations: These are capital goods which determine the nature, scope,
capacity and efficiency of production as well as company. These are non
portable and heavy goods. Examples are plants and machinery, major equipments,
building, assembly lines etc.
(b) Raw
Materials: These are the main inputs to the final products. These are the
part of the final products. Some of the raw-materials are required processing
before incorporated in the final products and there primary materials from
extractive and agricultural industrials-minerals, petroleum, iron ore etc do
not require any process.
(c)
Fabricated materials and parts: These are semi processed goods but
they may require further processing before being the part of final products.
For example pig iron for the production of steel.
(d)
Operating Supplies: These are not the part of final products but
these are required to continue the production process such as light bulbs, pen,
paper, computers etc.
(e)
Accessory Equipment: These are portable goods which are necessary
to keep the capital goods fit for operation. These are relatively less
expensive. These neither become the part of final product nor change its form.
For example bearing of a plant, wheal of a machine etc.
Features
of Industrial products are: 2017
a) Number of Buyers: Number of buyers of
industrial products are limited as compared to consumer products.
b) Channel of distribution: Shorter channel of
distribution is used for sale of industrial products are there are limited
buyers.
c) Geographical Concentration: Generally the
demand for industrial products is not scattered but is concentrated at a fixed
geographical location.
d) Derived Demand: Industrial products are
demanded to produce consumer products that is why it is called derived demand.
e) Technical consideration: Industrial
products are produced as a result of complex process so there is more technical
consideration of these products.
B.
Products based on durability:
(I)
Perishable products: These are the products which have very short
life and can not be stored for long time such as newspaper, a particular
service for one day or limited period.
(II)
Non-durable products: When the consumers start consuming or using
the products, the products last for few uses and get depleted on consumption
are non durable goods. For example, tooth paste, powder etc.
(III)
Durable products: These are products which have a long life and
consumers may use it for several years. For example - T.V., watch, furniture,
mobile hand-set etc. The consumers usually take long time to take the decision
of purchasing.
C. Products based on Tangibility:
(I)
Tangible products: It must be capable of being touched, seen,
verified its quality etc. For example pen, pencil, book.
(II) Intangible
products: A product may be intangible also but capable of providing
satisfaction through its service. For example repairing, consultancy service,
nursing etc.
8.
What is price and pricing mix? Explain the factors determining fixation
of price. 2012, 2013, 2014, 2015, 2019
Ans: Price is defined as the amount we pay for
goods or a service or an idea. Price is the only element in the marketing mix
of a firm that generates revenue. The term ― Price need not be confused with
the term ― Pricing. Price is the value that is put to a product or service. But
pricing is different from price. It refers to decisions related to fixing of
price of a commodity. A pricing strategy takes into account segments, ability
to pay, market conditions, competitors price etc while fixing price. It is
targeted at the defined customers and against competitors.
Factors
determining Fixation of price:
i) Cost of the product: Cost of the product is
the main component of the price. No company can sell its product or service at
less than the cost of the product. A Fixed and variable cost are to be
considered for determining the price.
ii) The utility and demand for the product: Intensive
study for the demand for product and service in the market is to be undertaken
before the fixation of the price of the product. If demand is relatively more
than supply, higher price can be fixed.
iii) Extent of competition in the market: It
is necessary to take into consideration prices of the product of the competing
firms prior to fixing the price. In case of cut throat competition it is
desirable to keep price low.
iv) Government and Legal Regulation: If the
price of the commodity and service is to be fixed as per the regulation of the
govt., it should also be borne in mind.
v) Pricing objective: Usually at the time of
price fixation a certain amount of profit is added to the cost of the product.
Objective is to earn higher profit, it may it may add amount of it.
vi) Marketing method used: - Price also
influenced by the marketing method used by the company. Example – Commission
which is to be paid to the middlemen for the sale of the goods is also added to
the price.
9. What is Branding? Write the
characteristics of goods brand name. What are its Advantages? 2016
Ans: A brand is define as a name, term, sign, symbol or special
design or some combinations of these elements that is intended to identify the
goods or services of one seller or a group of sellers. A brand differentiates
these products from those of competitors. A brand in short is an identifier of
the seller or the maker. It is simply giving a name or a sign or a symbol etc.
to a product. For example: Pepsi, Nike etc.
The
following features of goods brand name are given below:
a) It should be distinctive. A unique and distinctive symbol is not
only easy to remember but also a distinguish feature.
b) It should be capable of being are registered and protected
legally.
c) It should be appropriate.
d) It should be easy to read, pronounce and spell.
e) It should be adoptable to new products.
Advantages of Branding:
a) Brand name helps in advertising in an easier way.
b) Brand name establishes permanent identity of the product.
c) Branded products can be easily identified by consumers.
d) Brand name promotes repurchasing.
e) A good brand name helps to survive in the competitive market.
10. What is a labeling? What are its
Functions?
Ans: A label identity is the product or brand. Labels are attached
one to the product package to help the identification and provide some identity
to the customer.
Function
of Labeling:
a) Describe the product and specify its contents.
b) Grading of Product
c) Identification of the Product or Brand.
d) Help in promotion of Product.
e) Providing information required by law.
11. What is meant by Packaging?
Explain its functions and importance. 2013,
2016, 2018
Ans: Packaging: It refers to the group of those activities which
are related with the designing and production of the containers in which the
product are packet.
In the opinion of Prof. Rustom S.
Davar, Packaging is that art and/or science which is related to the development
and use of materials,
methods and equipment, for the packing of the goods in some containers, so that the product, while passing through
various stages of distribution,
could remain fully safe.
Functions
of Packaging
1. Product Identification: Packaging help in
identification of the product.
2. Product Protection: The main function of
the packing is to provide protection to the product from dirt, insect and
breakage.
3. Convenience: It provides convenience in
carriage, stocking and in consuming.
4. Product Promotion: Packaging simplifies the
work of sales promotion.
Importance
(Functions) of Packaging
1. Safety of the Products. The main function of packaging is to protect the things from dust, water,
moisture, insects, etc. Good packing
saves the products against perishing, loss and other damages.
2. Facility in Marketing Activities. Due to the packing, the movement
of the products, shifting, preserving, opening, collecting and storage, become economical and easier for both the middlemen as well as the consumers.
3. Advertisement. One of
the functions of packing is advertisement
too. Till there exists any product packet, it keeps us aware of the same.
4. Facility in Collecting. It is
easier to store the packaged goods.
Due to packing, the products remain safe in the godowns.
5. Information to the Customers. While making the product attractive, the packing could
also make the product useful and
informative. It can extend necessary instructions and information
more effectively to the customer regarding the use of the product.
12.
What is promotion mix? Mention its various dimensions or elements? Also explain
them. 2015
Ans: Promotion mix: Promotion
means communication with customers to stimulate them to buy goods. The nature
of promotion mix is determined by the marketing environment. There are various
dimensions of promotion mix are:
a. Advertising and publicity
b. Personal selling techniques
c. Sales promotion measures
d. Public relation techniques etc.
For explanation refer below.
13. What is advertising? Explain its
role and Limitations. 2012, 2013, 2014
Ans: Advertising: It is the most
commonly used tool of promotion. It is an impersonal form of communication,
which is paid by the marketers (sponsors) to promote goods or services. Common
mediums are newspaper, magazine, television and radio. Advertisements play a
very important role in offering innumerable benefits to the manufacturers,
customers and to the society in general.
Advantages of advertising to the various
sections of the society are stated below
1.
Advantages of Manufacturers
1) It creates demand for new products by informing people about the
availability and suggesting them about the use of such goods.
2) It promotes increased sales by maintaining the present demand and
expanding the markets by attracting more people to buy.
3) It creates goodwill by making the name of the manufacturer and his
products famous and known in every home.
4) It creates steady demand for products by smoothening out the
seasonal fluctuations in demand.
5) It reduces the cost of production by making large-scale production
possible through creation of demand. The large-scale production reduces the
total cost per unit of production.
2.
Advantages to Consumers
1) It facilitates purchasing by educating consumers to select correct
brands of commodities which increase their personal satisfaction.
2) It makes available goods at reduced prices as advertisement
increases sales, promotes large-scale production, reduces cost of production
and distribution and increases competition. This result in reduction in prices
and consumers get goods at reduced rates.
3) It increases the utility of commodities. Consumers come to know
about the proper and diverse use of commodities through advertising. This helps
to increase the utility of commodities for the consumers.
4) It ensures good quality of products. Advertising encourages
manufacturers to produce better quality products which boosts the confidence of
the consumers and ensures them availability of goods quality products.
5) It reduces the possibility of being cheated as through
advertisements the consumers come to know about the prices and composition of
goods.
3.
Advantages to Salesmen
1) It creates a proper base for the salesman by acquainting more
people, in a shorter time, with the merits of a product, its new uses, new
varieties and so on.
2) It educates even salesmen and increases their confidence, capacity
and initiative.
3) It reinforces the sales points and simplifies work of the salesmen
as they cannot reach all places and at all the times.
4) It reduces the effort of the salesmen as they can reach the right
prospects with the least effort.
5) It increases the remuneration of salesmen by supplementing their
efforts to increase sales and thereby increase remuneration.
4.
Advantages to the Society: Advertisement
is beneficial not only to the manufacturers and the consumers but also to the
society at large in the following ways:
1) It uplifts the living standards of the people. Advertising acts as
an effective tool in raising standard of living.
2) It generates gainful employment opportunities. Advertisement
generates gainful employment opportunities both directly and indirectly.
3) It provides new horizons of knowledge. It improves the knowledge,
language and style of the people.
4) It provides a regular source of income to newspapers. It has been
estimated that nearly 80% of the income of newspapers and magazines is secured
through advertisements. In its absence, the newspapers and magazines would have
become very costly and beyond the reach of people at large.
5) It transforms culture of a nation. The basis of advertising is the
taste of the public, its social customs and its culture. It influences the
fashions, tastes, habits, attitudes and likes and dislikes, etc. of the society
at large.
6) It acts as a barometer of a nation’s economic growth. Advertising
promotes healthy competition and provides better quality goods at cheaper rates
to the society.
14. Is
advertising a social waste? Give your views? Or What are the limitations of advertisement? 2014
Ans: Several objections have been raised against advertising and
some people criticize advertising as a social waste. The main point of
criticism is as follows:-
a) Creates Monopoly in the Market: Advertisement leads to promotion
and cover mass level of customers at a time. Large firms can bear the
advertisement expenditure but not the small firms, due to that it can eliminate
the small firms from the market and creates its monopoly authority in the
market.
b) Higher the Prices of Product: Investment of money in advertisement
leads to increase in the price of goods and services for which consumer has to
face high prices and pay for it. Hence, more the advertisement cost- more the
product cost.
c) Misleading the consumers: Now days, advertisement misleads the
consumers on false representation regarding their goods. Consumer attracts to
those goods which are not necessary for them. Thus, advertisement misleads the
consumer and sale goods to them.
d) Wasteful Consumption by the Consumers: Advertisement attracts the
consumers for wasteful products which are not necessary for consumers. Due to
advertisement businessmen takes undue advantage from them. They sale unhealthy
and artificial goods to them and exploits consumer emotions.
e) Wastage of National Resources: There will be wastage of national
resources, valuable stationary, time and energy used by the people or is
ignored by them. Here, Valuable resources that can be used to create new
industries are wasted in the production of needless varieties and designs.
15. What is personal selling? What are
its features? What are the qualities of a good salesman? Explain the importance
of personal selling to customers? 2016
Ans: Personal selling is the act of presenting of product or
services so that the consumer appreciate the need for it and mutually
satisfactory sales follows.
Features
of Personal selling:
a) Personal contact is established under personal selling.
b) Oral conversation.
c) Quick solution of queries.
d) Receipt of Additional Information.
e) Development of relationship.
Qualities
of a Good salesman:
a) Physical Qualities : Physical qualities include personality health, stamina and
tolerance
b) Mental Qualities: These include mainly skill, mental alertness, imagination and self
confidence.
c) Social Qualities: These include social-abilities tact, sound character, and sweet
nature.
d) Vocational Qualities: It includes mainly knowledge of product, knowledge of competitive
product, training and aptitude.
Importance
of Personal Selling:
Personal selling plays a very important role
in marketing of goods and services. It is important tool for businessmen,
customers and society.
a) Importance
to Businessmen: Personal selling is an important tool to increase the sale. It
is important for businessman due to following reasons:
Ø
Effective Promotion Tool: Personal selling is an effective tool to
increase the sale of product. Salesmen explain the merits and products to
customers.
Ø
Flexible Tool: Personal selling efforts can be changed according
to the type of customer salesmen are attending. They may change the offer in
varying purchase situations.
Ø
Minimum Wastage of Efforts: As compared to other methods of
promotion in personal selling the wastage of efforts is minimum.
Ø
Relationship: Personal selling helps to create lasting
relationship between customers and sales-persons which help in increasing
sale.
b) Importance
to Customers: Personal selling is very important from customer’s point of view,
as customers can get required information about the product from customers.
Customers are benefits by personal selling in the following ways:
Ø
Helps in Identifying Needs: Salesmen help the customers to
discover their needs and wants and they also help customers to know how these
needs and wants can be satisfied.
Ø
Latest Market Information: In personal selling salesmen provide
information regarding the new products available in market, uses of those
products etc.
Ø
Expert Advice: Customers can get expert advice and guidance in
purchasing various goods and services.
Ø
Induces Customers: Personal selling induces customers to buy
products for satisfying their needs.
c) Importance
to Society: Personal selling brings following positive effects for society:
Ø
Converts Latest Demand into Effective Demand: Personal selling
create effective demand which results in increasing sale and more income.
Ø
Employment Opportunities: Unemployed youth can work as salesman
and earn their livelihood.
Ø
Career Opportunities: Personal selling offers attractive career
with job satisfaction and security.
Ø
Mobility of Sales Persons: Sales people move from one place to
other, this promotes travel and tourism industry.
Ø
Product Standardization: With the help of personal selling there
can be uniformity of consumption by supplying standardized products.
16.
What is Sales Promotion? Mention its merits and demerits.
Ans: Sales Promotion: Sales promotion refers to short term use of
incentives or other promotional activities that stimulate the customer to buy
the product. Sales promotion techniques are very useful because they bring
short and immediate effect on sale.
Merits of sales promotion:
a) Attention
values: The incentives offered in sales promotion attract attention of the
people.
b) Useful
in new product launch: The sales promotion techniques are very helpful in
introducing the new product as it induces people to try new products.
c) Synergy
in total promotion efforts: Sales promotion activities supplement advertising
and personal selling efforts of the company.
d) Aid
to other promotion tools: Sales promotion technique make other promotion
techniques more effective. Salesmen find it easy to sell products on which incentives
are available.
Demerits
of sales promotion:
a)
Reflect crisis: If a firm is offering sales promotion techniques
again and again it indicates that there is no demand of product which can
create crisis situation.
b)
Spoil product image: Use of sales promotion tool may affect the
image of product as buyer feel that product is of low quality that is why firm
is offering incentives.
17. Explain sales promotion techniques/Model:
(a) Rebate (b) Product combination (c) Lucky Draw (d) Contest (e) Discounts
2012
Ans: (a) Rebate: - Sometimes, the product is made available at
special prices less than the original prices for a limited period of time,
e.g., recently Coke and Pepsi announced special price of their 500 ml bottles.
(b) Product Combination: - Product combination
is the bonus items given free with the purchase of a product. For e.g. A milk
shakers along with Nescafe, or mugs with Bourn vita or a diary along with a
packet of chips. They are effective in getting consumers to try a new product.
(c ) Lucky Draw:- A firm of purchased of a
fixed amount gives a coupon to a customer which entitles them for a lucky draw,
e.g., Bikanerwala restaurant in particular season gives lucky draw coupon on
purchase of Rs. 200 or more to its customers which entitles them to win exciting
prizes like car etc.
(d) Contests: - In these, consumer’ are
required to participate in some competitive event involving application of
skills or luck and winners are given some rewards. For instance, Golden
Harvest, maker of premium bread usually has children drawing competition.
(e) Discounts: - These are like price
promotion in which certain percentage of price is reduced as discount from the
list price, e.g., most of the retailers of garment like Snow White and
Shopper’s Stop offer their product at generous discount during a limited period
at the end of the season.
18. Differentiate between advertising
and personal selling. 2019
|
Basis |
Advertising |
Personal
Selling |
|
Form |
These are Personal. |
These are impersonal. |
|
Message |
These are uniformity of message which means
that the message is the same for the entire customer. |
This message has no uniformity which means
it can be changed keeping in view the behavior of the customer. |
|
Flexibility |
It lacks flexibility. |
It is completely flexible. |
|
Cost |
It is relatively less costly method. |
These are a most costly method. |
|
Time |
It takes a little time in conveying any
information to the customer. |
It takes more time in conveying any information to the customer. |
|
Media |
TV, radio, newspaper & magazine. |
Through salesman. |
|
Feedback |
This gives no information about the reaction of the customer. |
The reaction of the customer becomes
immediately affect. |
19. Distinguish between advertising
and publicity. 2018,
2020
Ans: Difference between advertising
and publicity
|
Basis |
Advertising |
Publicity |
|
Meaning |
The activity of generating advertisements of products and
services to commercialize them is known as Advertising. |
The activity of providing information about an entity, i.e. a
product, an individual or a company to make it popular is known as Publicity. |
|
Given by |
It is done by company and its representative. |
It is done by third party. |
|
Cost |
It is a paid form of communication. |
It is unpaid form of communication. |
|
Credibility and reliability |
Credibility and reliability is more as compared to publicity. |
Credibility and
reliability is less. |
|
Control |
There is complete control over advertisement. |
There is no control over publicity. |
20. Distinguish between advertising
and Sales Promotion.
Ans: Difference between advertising
and sales promotion
|
Basis |
Advertising |
Sales promotion |
|
Meaning |
The activity of generating advertisements of products and
services to commercialize them is known as Advertising. |
Sales promotion refers to short term use of incentives or other
promotional activities that stimulate the customer to buy the product. |
|
Strategy |
It is permanent strategy. |
It is a limited time promotion strategy. |
|
Cost |
It is highly expensive. |
It is cost effective. |
|
Best suited for |
It is best suited for medium and big enterprises. |
It is suitable for all enterprises. |
|
Objective |
Its main objective is to build brand image and boosting sales. |
Its main objective is short term sales push. |
21. What is meant by channel of
distribution? What are its various types? What are the factors affecting choice
of channel of distribution? 2013,
Ans:
A channel of distribution is an organised net-work or a system of agencies and
institutions which, in combination, perform all the activities required to link
producers with users and users with producers to accomplish the marketing task.
According to Philip Kotler, “The distribution
is the set of all firms and individuals that assist in the transferring the
little of goods and services as they move from producers to customers.”
Types of Channels of Distribution:
A.
Zero-level channel (producer to consumer): It is also called as direct marketing
or direct selling. This channel consists of the producer who directly sells his
products to the ultimate consumers. This is the shortest, simplest, and cheapest
form of distribution. Producers are benefited by increased profit, whereas
consumers are benefited by reduced price. This is possible because it
eliminates the middleman completely. With the development of sophisticated and
efficient retailing like supermarkets, chain-stores, automatic selling machine
is financially sound follow this channel of distribution. For products like
jewelry and industrial goods like machinery, this is the best channel.
Factors
Affecting the Selection of the Channel of Distribution
A. Factors Pertaining to the Product: The
following factors concerning the product, affect the selection of the channel
of distribution: (1) Price of the Product. (2) Perishability. (3) Size and Weight. (4) Technical Nature. (5) Goods Made to Order. (6) After-Sales Service.
B. Factors pertaining to the Consumer or Market: The
following are the main elements concerned with the consumer or the market: (1) Number of Customers. (2) Expansion of the Consumers. (3) Size of the Order. (4) Objective of Purchase. (5) Need of the Credit Facilities.
C.
Factors Pertaining to the Middlemen:
The
following are the main factors concerned with the middlemen: (1) Services Provided by Middlemen. (2) Scope or Possibilities of Quantity of Sales. (3) Attitude of Agents towards the Producers'
Policies. (4) Cost of Channel of Distribution.
D. Factors Pertaining to the Producer Or
Company: The following factors, concerning the
producer, affect the selection of the channel of distribution: (1) Level of Production. (2) Financial Resources of the Company (3) Managerial Competence and Experience.
E. Other Factors (1) Distribution Channel of Competitors. (2) Social Viewpoint (3) Freedom
of Altering.
22. What is physical distribution of
goods? Mention its components. Explain the role of physical distribution. 2016
Ans: Physical Distribution of Goods: The channels of distribution
are used by the firms to make the goods available at right place in right
quantity. Whenever customer visits the market he expects all the goods and
services he desires must be available there and these are made available in the
market by producers with the use of various intermediaries. Physical
distribution involves physical handling and movement of goods from place of
production to the place of consumption. Physical distribution is also known as
logistic management. In commercial sense it means the activities and decisions
concerned with efficient movements of products and services.
Decisions
in Physical Distribution/Components of Physical Distribution: There are
four major activities involved in physical distribution of goods. There are the
four major decisions which management has to take while providing physical
distribution service:
a) Order
Processing: Order processing means the time and steps involved between taking
order from customer and delivery of goods as per order. There is direct
relation between the time taken in order processing and satisfaction of
customer. Fast order processing gives more satisfaction to customer but this
involves cost of maintaining sufficient inventory etc.
b) Warehousing:
Whatever is produced is not sold off immediately. Therefore every company needs
to store the finished goods until they are sold in the market. Storage of goods
is necessary because some goods like crops are seasonal in production but are
demanded throughout the year so these have to be stored for supplying
throughout the year.
c) Inventory Planning and Control:
Inventory refers to the stock of products a firm has on hand and ready for sale
to customers. Inventories are kept to meet market demands promptly. Inventory
is the link interconnecting the customer’s orders and the company’s production
activity. Infact the entire physical distribution management rotates around the
inventory management. Inventory management is the heart of the game of physical
distribution. Marketing managers undertake an inventory planning to develop
adequate assortments of products for the target market and also try to control
the costs involved in obtaining and maintaining inventory.
d) 4.
Communications: It
is a process of passing information and understanding from one person to
another. This includes the information system which should link producers,
intermediaries, and customers. Computers, memory systems, display equipment and
other communication technology facilitate the flow of information among other
members in the channel.
e) 5.
Organisational Structure: The
person in charge of the physical distribution should co-ordinate all Activities
into an effective system to provide the desired customer service in the most
efficient manner. Examples of organizational consideration are: (i) How can the
five elements of physical distribution best be coordinated so that a team
effort results? How can compartmentalization thinking be avoided? (ii) If a
central head is established to direct all physical distribution activities, to
whom should he report—The Head of the Marketing or The Chief Executive Officer?
f) Transportation:
Transportation as the last component of distribution system. Transportation
means physical movement of goods from place of production to place where they
are required. Transportation adds value to the goods by moving them to place
where these are required for example, Tea plantation is done in Darjeeling,
Gangtok, Assam etc. but these are transported all over the country and the
value of tea is much higher in other parts of country as compared to the place
of production. There are various means of transportation available i.e. Rail,
Road, Air, Pipeline, Water transport etc.
Significance or Importance of
Physical Distribution Management:
The physical distribution of goods has assumed
great importance particularly in recent years, because of the ever increasing
competition for markets. The importance of physical
distribution lies in the following directions:
1. It Creates Utilities Of Time And Place: By making
available a product at the place where and when it is needed.
2. It Accounts For A Major Portion Of Marketing Costs: According
to one estimate, physical distribution costs constitute as much 60% of the
total marketing cost. Physical distribution is a
very important area for cost savings. Over the years, in most businesses,
physical distribution costs have grown into a sizeable portion of the total
costs. Surprisingly, physical distribution despite being an important cost area
has remained one of the neglected areas for cost reduction.
3. Bigger Share in the National Wealth: It represents large share in the
national wealth in the form of facilities—rail, road, trucks, highways,
aircrafts, ship, docking facilities, pipelines, storage facilities and
equipment.
4. Specialisation It Facilitates Geographic
Specialization: Each area
produces goods that its natural resources, climate or pool of manpower
resources enable it to produce more efficiently.
5. Determines Standard Of Living: This is so because proper distribution of products makes them available to a large number of people, at a relatively lower cost. Thus it can be said that physical distribution directly affects sales, customer service and satisfaction, and costs.