CUSTOMER_CODE SMUDE
DIVISION_CODE
EVENT_CODE
SMUDE
SMUAPR15
ASSESSMENT_CODE MB0046_SMUAPR15
QUESTION_TYPE DESCRIPTIVE_QUESTION
QUESTION_ID 9785
QUESTION_TEXT
What is direct marketing? Briefly discuss the various types that can be used for direct marketing.
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Direct marketing means getting the message directly to the customer without using any intermediaries. Direct marketing is an interactive system of marketing, which uses one or more advertising media to affect a measurable response and transaction at any location. (2 marks)
There are different forms of direct marketing. Let us discuss the different forms of direct marketing programmes. (2 marks each)
* Direct mail marketing: Direct mail is used to build customer relationship in the long run. Direct mail can alert dealers about future customer promotions, educate them on service problems, and survey them concerning their needs. Direct marketing can also be used to build company morale. Internal news letters and other employee communications are often used to personalise large corporations.
* Telemarketing: This is the second most used direct marketing tool.
Effective communication is vital to corporate survival and success.
Due to the widespread use of mobile and fixed landline networks, telephone has become the most important part of the marketing communication strategy. In many areas, it is replacing post and personal contact as the most efficient way to send, receive and process information.
* Direct selling: Direct selling identifies the unfulfilled needs of ordinary customers. In this method, it only takes a minute to clinch a sale by choosing the right minute to contact the customer or may involve a day’s work for a direct marketer.
* Internet based selling: Internet revolution has developed as an alternate way of living for us. Online buying has become one of the alternative living patterns in the 21 st
century. People are showing higher interest in online marketing as it provides a real time, interactive and personalised environment for the marketers to transact on online store fronts.
QUESTION_T
YPE
QUESTION_I
D
DESCRIPTIVE_QUESTION
126172

QUESTION_T
EXT
Differentiate between selling and marketing concepts.
Differences Between Selling and Marketing Concepts
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N
QUESTION_TYPE DESCRIPTIVE_QUESTION
QUESTION_ID 126176
QUESTION_TEXT Discuss the bases of market segmentation.
Bases for Segmenting Consumer Markets
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EVALUATION Marketers use more than one base to segment the market and identify the target market. The method of segmentation will vary in a

business-to-business market than in individual consumer markets.
Following are the common bases of marketing segmentation.
7.6.1 Geographic segmentation
This is the simplest form of segmenting the market. Here, the marketer divides the target market into different geographical units such as nations, states, and regions. He/she may decide to operate in one or more than one geographical areas. Segmentation of customers based on geographic factors is as follows:

Region – Segmentation by continent/country/state/district/city.

Size – Segmentation on the basis of size of a metropolitan area as per its population.

Population density – Segmentation on the basis of population density such as urban/sub-urban/rural, etc.

Climate – Segmentation as per climatic condition or weather.
7.6.2 Demographic segmentation
While it is easy to find and group people living in one geographic location, there may be a large variation in their demographic characteristics. Since consumer needs, wants, and demand patters are directly linked with demographical variables, this method of segmentation is popular among marketers. Segmentation of customers based on demographic factors is as follows:
 Age (dominant factor) – The age of a person is one of the basis of segmentation. For example, the product segmentation is done by
Titan according to different age groups of people. Titan designed a sub-brand, Fastrack. These watches are basically for young, vibrant, and cool outgoing young generation. While for older person and professional it has created the steel series watches, Sonata.
 Income (dominant factor) – Income level of a person is also a basis of segmentation. For example, Titan watches offered Aurum and
Royale in the gold/jewellery watch collection with the price ranging between
` 20000 to `1 lakh for upper class segment.
Titan offered Exacta range in stainless steel, aimed at resisting the rigours of daily life for the middle segment. This range offers
100 models with the price ranging between ` 500 to ` 700.

Titan presented the Sonata range for the third segment. The price range was between ` 350 to ` 500.

Purchasing power (dominant factor) – Purchasing power of the buyer is one of the significant basis for segmentation. Examples of various car segments on the basis of purchasing power are as follows:

Budget car segment – This segment is the biggest in the Indian market.
The entry level of this segment begins from ` 1.5 to 3 lakh. Maruti
800 and Omni are the leading players in these segments. The viewpoint of this segment has changed with the launch of Tata Nano with a price range of 1 lakh. Small car segment is another name for this segment. In Indian market, there is highest competition in this segment.

Compact car segment – This segment lies among budget car and family car. The price range preference is between ` 3 to 4.5 lakh. Maruti
Zen, Fiat Uno, Tata Indica, and Santro is some of the leading players of this segment.

Family car segment – The buyer’s purchasing power in this segment is rather higher than the budget and compact car segment. The price range of this segment is between ` 4.5 to 6 lakh. Maruti Esteem,
Daewoo Cielo, and HM Contessa comes under this segment. In India, cars that are sold under the head ‘budget car’ and ‘compact car’ do not meet their purpose, especially in terms of space shifts to ‘family car segment’.
 Premium car segment – The purchaser who wants a true world class luxury car comes under this segment. Price range of this segment is between ` 6 to 8 lakh. A few main cars of this segment are Ford
Escort, Honda City, Mitsubishi Lancer, Audi 1800, Opel Astral, etc.
 Super luxury saloon segment – This segment consists of buyers who look for a real, super premium car. Some of the major cars of this segment are Mercedes Benz E229, E-250, Rover Montego, Audi 6,
BMW. In Indian market, this is a small segment.
1. Occupation
2. Gender - Goods may be segmented for male and female
3. Family size
4. Family life cycle
5. Nationality
6. Religion
7. Education - Primary, high school, secondary, college, and universities

Psychographic segmentation
Other than the demographic methods of market segmentation, segmentation on the basis of psychography is another popular method among marketers. Psychographics is the study of lifestyle of individuals. It involves developing sub-group identification on the basis of psychographical characteristics. Lifestyle is a way of living.
It reflects a person’s living as a combination of his actions, interests, and opinions.
Behavioural segmentation
In the case of behavioural segmentation, the market is divided on the basis of purchase decision and product or brand usage made by consumers.
Dividing the market on the basis of variables such as use occasion, benefits sought user status, usage rate, loyalty status, buyer readiness stage, and attitude is termed as behaviouristic segmentation. Buyers can be identified according to the use occasion when they develop a need and purchase or use a product
QUESTION_TYPE DESCRIPTIVE_QUESTION
QUESTION_ID 126177
Explain the stages in the new product development.
QUESTION_TEXT
1. Concept generation and market structure identification
 Idea generation
The first stage of new product’s evolution begins with an idea for the product. Hence this stage is also termed as ‘idea generation’. Ideas may originate from the following sources:
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 Sales personnel
 Marketing personnel
 Research and development department
 Top management executives

Production department


Customer service decisions

Employee suggestion system

Customers

Competitive products

Foreign products
 Market structure analysis
The next step in the process of new product development process is to implement a market structure. This process delineates the consumer’s perception of market by building a map outlining the critical consumer dimensions, positioning existing brands on the perceptual map, and indicating favourable new product opportunities.
 Sales potential
In this step, the potential of a new product entry into the market structure is estimated. The purpose of developing such a model helps in establishing a rough estimate of the size of the business potential. It also helps in establishing a base case for using this model for continuous monitoring of the sales forecast and its advances throughout the new product development process.
 Concept screening
At this stage, the ideas collected are scrutinised to eliminate those inconsistent with the product policies and objectives of the firm. The main intention of this phase is only to eliminate unsuitable ideas as quickly as possible.
2. Advertising development
This stage of new product development involves the development of advertising and formulation of the product. All the advertising and technical developments of the product concept have a greater focus due to the results from the earlier stages. This stage typically involves two activities, viz. development of advertising strategy and product formulation.
The main objective of advertising is to create advertising copy, which can reflect the product’s points of difference to the consumer.
Asking the client servicing and creative team to observe the focus

group discussion helps in initiating advertising strategy development process. Both the teams get a chance to look at the real consumers and listen to their opinion about the product category and product proposition.
3. Product formulation and testing
The product formulation happens in the laboratory. During this stage, the ‘idea-on-the-paper’ is turned into a ‘product-on-hand’. In other words, the idea is converted into a product that can be produced and demonstrated. This stage is also termed as technical development. It is during this period that all developments of the product, from idea to final physical form, take place.
The final decision whether a product should be developed on a commercial scale or not is decided at this stage because the time-lag required to attain this stage is long and it is possible that some adverse developments might have taken place during this period.
4. Testing the product
In this stage of product testing, the new product manager can check the feasibility and accuracy of product performance. Thus, commercial experiments are necessary to verify earlier business judgments. The objective of this stage is to assess whether the product meets the technical and commercial specifications developed at various levels of concept development for ascertaining product acceptability.
5. Commercialisation and final launch
In this stage, the product is submitted to the market and thus commences its lifecycle. Commercialisation is also the phase where marketing is most active in connection with the new product. This stage is considered to be a critical one for any new product and should therefore be handled carefully.
For instance, it should be checked whether advertising and personal selling have been done effectively and whether proper outlets have been arranged for the distribution. Despite the care with which the previous development stages have been planned, unforeseen events can impair commercialisation seriously. The following activities are usually undertaken during this stage:
 Completing final plans for production and marketing


Initiating coordinated production and selling programs

Checking results at regular intervals
All the stages explained above stress the fact that the development of a new product must pass through certain logical stages. Innovation is necessarily an orderly and predictable process and can be performed only in a sequence. For example, commercialisation cannot precede the development stage of a product.
QUESTION_TYPE
QUESTION_ID
DESCRIPTIVE_QUESTION
126182
QUESTION_TEXT Explain the functions performed by marketing channels.
1. Buying (1 Mark)
2. Carrying inventory (1 Mark)
3. Selling (1 Mark)
4. Transportations (1 Mark)
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5. Financing (1 Mark)
6. Financing (1 Mark)
7. Promoting (1 Mark)
8. Negotiations (1 Mark)
9. Marketing research (1 Mark)
10. Servicing (1 Mark)
QUESTION_TYPE DESCRIPTIVE_QUESTION
QUESTION_ID
QUESTION_TEXT
126184
What is retailing? Briefly explain the most important types of retailing?
Retailing is the final connection in the marketing channel that brings goods from manufacturers to consumers. In other words, retailing is the combination of activities involved in selling or renting consumer goods and services directly to ultimate consumers for their personal or household use.
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Types
 Mom and pop stores and kirana stores
 Department stores
Discount

stores
 Category killers
 Specialty stores
 Superstores and hyper markets