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Xaviers Institute of Business Management Studies
SUBJECT: MARKETING MANAGEMENT
COURSE : MBA Total Marks : 100
INSTRUCTIONS
- Answer all the Questions
- Present your Answer with tidiness and to the point.
- Question No 1 to 8 carry 10 marks each and question No.9 carry 20 marks.
Question. 1. At the time when the market leader for instant noodles was Nestles Maggi, the main challenger was Top Ramen’s Noodles. Applying the concepts of marketing Management, what would be your strategic plan in order to keep up the top position of Maggi.
Answer : Analysis SEGMENTATION SEGMENTATION TARGETING POSITIONING DIFFERENTIATION Age, Eating Habit, Lifestyle of families, Small Children, Teenagers, Youth / College Students, Office Goers, Working Women, Old People who find it difficult to cook People on the move Health conscious, people – Aata noodles Fast
Question. 2. Discuss the relationship between ‘Segmentation’ and ‘Positioning’. Explain the major criteria of Segmentation and Positioning. Quote sufficient examples to strengthen your answer.
Answer : The division of a broad market into small segments comprising of individuals who think on the same lines and show inclination towards similar products and brands is called Market Segmentation. Market Segmentation refers to the process of creation of small groups (segments) within a large market to bring together consumers who have similar requirements, needs and interests. The individuals in a
Question. 3. (a) Describe in detail the stages in the Product Life Cycle.
Answer : The product life cycle has 4 very clearly defined stages, each with its own characteristics that mean different things for business that are trying to manage the life cycle of their particular products.
- Introduction Stage – This stage of the cycle could be the most expensive for a company launching a new product. The size of the market for the product is small, which means sales are low, although they will be increasing. On the
Question. (b) In this context, explain the challenges that a Marketing Manager has to deal while introducing a new product.
Answer : Following are the Challenges that a marketing manager has to deal while introducing a new product :
Concept – The first challenge you face when developing new products is choosing a concept that has potential. A good idea is only a first step and often isn’t viable because of cost, production difficulties or regulatory limitations. Your new product development company can only take on projects for which it can establish a reliable path through development, and your team has to learn to recognize such products.
design. You have to show that your product can be built for the cost you estimated and that it will work as planned. You may also develop customer documentation and instruction manuals.
Marketing – While you may help with identifying target markets, establishing possible marketing concepts and test marketing, carrying out the marketing plan is usually the job of your client company or the company that will handle the developed product. Your involvement normally ends with a successful product launch, although you may continue to act in an advisory capacity, especially if your compensation includes a share of the future profits.
4. What do you understand by Channel of Distribution? Explain the different kinds of Channel of Distribution in detail.
Answer : A distribution channel is a chain of businesses or intermediaries through which a good or service passes until it reaches the final buyer or the end consumer. Distribution channels can include wholesalers, retailers, distributors, and even the Internet. Distribution channels are part of the downstream process, answering the question “How do we get our product to the consumer?” This is in contrast to the upstream process,
5. Explain the factors affecting Pricing Decision. What are the various methods of pricing a Product? Briefly explain them. Also, differentiate between Price shadowing and Price Covering.
Answer : Factors affecting pricing decision –
- Organizational Objectives: Affect the pricing decisions to a great extent. The marketers should set the prices as per the organizational goals.
6. What are the essential Factors influencing Consumer behavior? Explain its significance in Marketing Management in accordance with the Technology advancements.
Answer : Factors influencing Consumer Behaviour –
1.)Cultural factors – Culture plays a very vital role in the determining consumer behaviour it is sub divided in
Culture – Culture is a very complex belief of human behaviour it includes the human society, the roles that the society plays, the behaviour of the society, its values customs and traditions. Culture needs to be examined as it is a very important factor that influences consumer behaviour.
Sub-Culture – Sub-culture is the group of people who share the same values, customs and traditions. You can define them as the
7. Write Short Notes on any four of the following:
(a) Price Skimming.
Answer : Price skimming is a product pricing strategy by which a firm charges the highest initial price that customers will pay and then lowers it over time. As the demand of the first customers is satisfied and competition enters the market, the firm lowers the price to attract another, more price-sensitive segment of the population. The skimming strategy gets its name from “skimming” successive layers of cream, or customer segments, as prices are lowered over time.Price skimming is often used when a new type of product enters the market. The goal is to gather as much revenue as possible while consumer demand is
(b) Media Selection for Advertising
Answer :
(c) Sales Promotion
- Answer : Sales promotion refers to ‘those marketing activities that stimulate consumer shows and expositions. Purchasing and dealer effectiveness such as displays, demonstration and various non- recurrent selling efforts not in the ordinary routine.” According to A.H.R. Delens: “Sales promotion means any steps that are taken for the purpose of obtaining an increasing sale. Often this
(d) Product Differentiation
- Answer : Product differentiation is a marketing strategy that strives to distinguish a company’s products or services from the competition. Successful product differentiation involves identifying and communicating the unique qualities of a company’s offerings while highlighting the distinct differences between those offerings and others on the market. Product differentiation goes hand-in-hand with developing a
(e) Demand Inelastic in Business Buyer Behavior
Answer :
(f) Vertical Marketing System
- Answer : A vertical marketing system (VMS) is one in which the main members of a distribution channel—producer, wholesaler, and retailer—work together as a unified group in order to meet consumer needs. In conventional marketing systems, producers, wholesalers, and retailers are separate
8. A new product is to be launched by a company at Mumbai. As a part of identifying the consumer behavior, the company intends to carry out a research process. Outline a Marketing Research Process for the company in order to establish the requirements of the consumers.
Answer : Marketing research process as follows :
Step 1: Identify the Problem
The first step for any marketing research activity is to clearly identify and define the problem you are trying to solve. You start by stating the marketing or business problem you need to address and for which you need additional information to figure out a solution. Next, articulate the objectives for the research: What do you want to understand by the time the research project is completed? What specific information, guidance, or recommendations need to come out of the research in order to make it a worthwhile investment of the organization’s time and money? It’s important to
9. Case Study – Read the Case carefully and answer to the questions analytically.
Case Study on Maruthi Udyog Ltd.
Maruti Udyog L:td.MUL is the largest auto manufacturer in India. It has 70 percent share of the small car segment and 40 percent of the luxury segment. It was set up as a joint venture between the Government of India and Suzuki motors of Japan. Today the government has reduced its stake and it is a Suzuki firm. It has a vendor network of nearly 450, a third of who have ISO 9000 certification. It also has joint ventures with some of its vendors to ensure quality and timely delivery. Maruti has about 14 models to cars, vans and jeep. In the small car segment, it completes with Santro of Hyundai and Indica from the Tatas.
Maruti’s vision and mission statement are given below
Vision: To be competitive worldwide in products and services retain leadership in the country and aspire for a good market share internationally.
Mission: To sell a variety of cars- modern, high technology and fuel efficient – in the Indian and foreign markets.
The firm’s values are as follows
Growth oriented organization ready to change to meet customers demand at short notice.
Value for money for the customers.
Stakeholders’ involvement and satisfaction.
Responsible corporate citizen.
Competitive Analysis of Maruti
Maruti had a good run till 1998 when several international players challenged its supremacy . In the small car segment, Santro of Hyundai, and Indica from the Tatas pose major problems for Maruti . In the luxury segment, its Esteem faces competition from Honda City, Opel Astra , Ford Escort and Ford Ikon. Its jeep Gypsy faces competition from Mahindra& Mahindra’s jeeps, and Tata’s Sumo and Safari.
Threat of new entrants is real as the segment of middle class cars is growing rapidly, Volvo, Volkswagen and Toyota are also planning to enter the market.
To beat Maruti’s brand image, economics of scale and marketing and service network , new firms have to spend a lot of money and efforts and that could be the entry barrier.
Critical success factors of Maruti:
1. Suzuki technology
2. Economic scale of production
3. Strong R&D.
4. Timely market feedback as a result of continuous research
5. Large range of models.
6. Strong dealer network
7. Large service network around the country with trained technicians.
8. Quality programmes (Kaizan)
9. Design expertise
10. Brand equity
11. Provides leasing options, hire purchase schemes.
Realising the imminence of competition in 1998 , Maruti planned to have relationship marketing , with an idea of selling Maruti cars to its existing customer base and upgrading product purchase . Maruti introduced Zen Alto and Wagon R, for this purpose.
MUL has competitive advantages in the segments it operates in to counter the onslaught of competition it even reduced the price and went for volume business .MUL has maintained its competitive advantage in the following manner.
1. Superior Suzuki compact car technology.
2. Value for money
3. Low maintenance cost.
4. Reliable quality
5. Largest network of dealers and service centres.
6. large product range for various needs and pockets.
7. Easy availability and attractive finance schemes .
8. ISO certification, even for a large number of dealers.
9. Technology transfers to important vendors for ensuring quality supplies.
Maruti is a household’s name not only in India but in a number of countries of the west as well. With a modest beginning in 1997 when it exported 102 cars, now MUL exports to more than 30,000 cars to 74 countries. The countries include Italy, Holland and Chile; around 70 percent sales are to Europe.
Maruti looks confidently to the future with the following agenda:
1. Commitment to customer satisfaction/delight.
2. Expansion and modernization of facilities.
3. New model as per market demand
4. Model upgradation .
5. Market research to remain proactive in the market.
6. Emphasis on overseas markets
7. Finance for the customers.
Questions:
1. Discuss the main issues narrated in the case in your own style.
Answer : Few international players challenging its supremacy :
1.) In the small car segment, Santro of Hyundai, and Indica from the Tatas pose major problems for Maruti .
Question. 3. Based on the Analysis of the case, put forth your views and suggestions.
Answer : : The major strengths of Maruti Udyog are good track record in customer satisfaction, possibly the widest distribution network in the country, success in international markets, technological Support and Back up from Suzuki Motors, Japan. The company has an enviable record of getting the highest score in Customer Satisfaction with Dealer Service in India for a 13th Consecutive year. Their weaknesses are labour problems, profit after tax (PAT) has not increased with increasing sales and quality problems and recall. The opportunities before the company are growing domestic market (barring the recent downturn), strong image and wide portfolio of products. The threats faced by Maruti are increasing competition as there are nearly 20 players in the market and with
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