MS-06 IGNOU MBA Assignment Marketing for Managers

Solved MBA IGNOU Assignment MS -06- Marketing For Managers

Solutions to MBA IGNOU Assignment-Marketing for Managers-MS 06

Answers to MBA IGNOU Assignment-Marketing for Managers-MS 06

MS-06:  Marketing for Managers

ASSIGNMENT

Course Code                                                  :           MS-06

Course Title                                                   :           Marketing for Managers

Assignment Code                                          :           06/TMA/SEM-I/2008

Coverage                                                        :           All Blocks

Note:   This assignment consists of four questions, you have to attempt all and send it to the co-ordinator of the study center, you are attached with.

 1.         a)         What makes Services Marketing more challenging and tough than product                              marketing? Discuss.

There are five characteristics of services marketing which was more challenging and tough than product marketing.

1. Lack of ownership.

You cannot own and store a service like you can a product. Services are used or hired for a period of time. For example when buying a ticket to the USA the service lasts maybe 9 hours each way , but consumers want and expect excellent service for that time. Because you can measure the duration of the service consumers become more demanding of it.

2. Intangibility

You cannot hold or touch a service unlike a product. In saying that although services are intangible the experience consumers obtain from the service has an impact on how they will perceive it. What do consumers perceive from customer service? the location, and the inner presentation of where they are purchasing the service?.

3. Inseparability

Services cannot be separated from the service providers. A product when produced can be taken away from the producer. However a service is produced at or near the point of purchase. Take visiting a restaurant, you order your meal, the waiting and delivery of the meal, the service provided by the waiter/ress is all apart of the service production process and is inseparable, the staff in a restaurant are as apart of the process as well as the quality of food provided.

4. Perishibility

Services last a specific time and cannot be stored like a product for later use. If traveling by train, coach or air the service will only last the duration of the journey. The service is developed and used almost simultaneously. Again because of this time constraint consumers demand more.

5. Heterogeneity

It is very difficult to make each service experience identical. If traveling by plane the service quality may differ from the first time you traveled by that airline to the second, because the airhostess is more or less experienced.

A concert performed by a group on two nights may differ in slight ways because it is very difficult to standardize every dance move. Generally systems and procedures are put into place to make sure the service provided is consistent all the time, training in service organizations is essential for this, however in saying this there will always be subtle differences.

b)         Marketing Strategy Development is the outcome of marketing mix elements. Explain the relationship with two suitable examples.

Marketing strategy is a conscious approach to accomplishing something. Strategy precedes marketing and marketing strategy. The first time a human planned an approach for achieving a desired end—a goal or objective—he or she was developing strategy. Strategy can be formulated by individuals, groups, and organizations. The organizations can be families, corporations, nations, or groups of nations. In modem times, strategy can be formulated by complicated and sophisticated programmed software operating on computerized systems, personal computers, or computer networks.

Marketing Mix is the mixture of controllable marketing elements that the firm uses to achieve the target market.

Marketing Strategy is a set of sub-strategies concerned with competition, segmentation, pricing, promotion and distribution. Structural criteria core the following: (a) Coherence (b) Consistency (c) Contribution (d) Relative significance.

The following factors determine the key elements. These are: (a) Product (b) Type of market (industrial / consumer) (c) Stages in evolution (emerging, transition and decline) and competitive conditions.

Therefore, the key factor in the marketing mix is crucial in drawing up a marketing strategy. In devising an optimum marketing mix, it is important to know about how various marketing mix variable interact in their impact in sales / profits.

The development of strategies in relation to some of the elements of marketing mix is determined. These relate to marketing mix decisions with respect to new product development stages in the life cycle of a product and the role of advertising and pricing in the marketing mix.

Marketing strategy is the result of decision making by corporate executives, marketing managers, and other decision makers. In general, the formal organizational titles or jobs of decision makers, or the nature or purpose of the organization, is irrelevant to the formulation of marketing strategy. When the decisions concern products or markets, the results—i.e., the decisions—are all considered marketing strategy.

Marketing strategy is developed at different levels of an organization (the hierarchical dimension), across core marketing functions (the horizontal dimension), and for marketing execution and control functions (the implementation dimension). Strategy is usually developed in a hierarchical fashion from top to bottom; for example, there could be several layers of objectives where each objective is a function of a superstructure of superior objectives, and a determinant of subordinate objectives (except for the highest and lowest levels of objectives). Higher-level decisions—the superstructure—act as constraints on the one hand, and guides or aids for decision making on the other. The organization levels could include the overall corporate level, strategic business units, product markets, target markets, and marketing units, depending on the complexity of the organization.

Strategy is also developed across the core functional areas of marketing: product, price, place/distribution, and promotion strategies. Any functional level of marketing, in turn, can have additional levels of marketing strategy decisions where refinement of the strategy might take place. For example, in the advertising component of the promotion function, the organization might develop marketing strategy consisting of advertising objectives, advertising strategies, advertising themes, advertising copy, and media schedules. In addition, because of the growing customer emphasis of marketing, marketers have added new customer-oriented components to the marketing mix: customer sensitivity, customer convenience, and service.

 2.         a)        Explain the concept of PLC as a tool for market cultivation.

The Product Life Cycle (PLC) is based upon the biological life cycle. For example, a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as it becomes an adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline).

In theory it's the same for a product. After a period of development it is introduced or launched into the market; it gains more and more customers as it grows; eventually the market stabilises and the product becomes mature; then after a period of time the product is overtaken by development and the introduction of superior competitors, it goes into decline and is eventually withdrawn.

However, most products fail in the introduction phase. Others have very cyclical maturity phases where declines see the product promoted to regain customers.

Strategies for the differing stages of the Product Life Cycle.

Introduction:

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.

Growth:

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.

Maturity:

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.

Decline:

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.

Problems with Product Life Cycle

In reality very few products follow such a prescriptive cycle. The length of each stage varies enormously. The decisions of marketers can change the stage, for example from maturity to decline by price-cutting. Not all products go through each stage. Some go from introduction to decline. It is not easy to tell which stage the product is in. Remember that PLC is like all other tools.

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.

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.

b)         Discuss the major objectives of Sales Promotion. Explain some of the sales promotion methods directed at consumer, which can be used by the following

a)                Low Cost domestic Airliner

b)               Improved Herbal Hair Colour Marketer

Objectives of Sales Promotion:

• Building Product Awareness – Several sales promotion techniques are highly effective in exposing customers to products for the first time and can serve as key promotional components in the early stages of new product introduction.  Additionally, as part of the effort to build product awareness, several sales promotion techniques possess the added advantage of capturing customer information at the time of exposure to the promotion.  In this way sales promotion can act as an effective customer information gathering tool (i.e., sales lead generation), which can then be used as part of follow-up marketing efforts.
• Creating Interest – Marketers find that sales promotions are very effective in creating interest in a product.  In fact, creating interest is often considered the most important use of sales promotion.  In the retail industry an appealing sales promotions can significantly increase customer traffic to retail outlets.  Internet marketers can use similar approaches to bolster the number of website visitors.  Another important way to create interest is to move customers to experience a product.  Several sales promotion techniques offer the opportunity for customers to try products for free or at low cost.
• Providing Information – Generally sales promotion techniques are designed to move customers to some action and are rarely simply informational in nature.  However, some sales promotions do offer customers access to product information.  For instance, a promotion may allow customers to try a fee-based online service for free for several days.  This free access may include receiving product information via email.
• Stimulating Demand – Next to building initial product awareness, the most important use of sales promotion is to build demand by convincing customers to make a purchase.  Special promotions, especially those that lower the cost of ownership to the customer (e.g., price reduction), can be employed to stimulate sales.
• Reinforcing the Brand – Once customers have made a purchase sales promotion can be used to both encourage additional purchasing and also as a reward for purchase loyalty (see loyalty programs below).  Many companies, including airlines and retail stores, reward good or “preferred” customers with special promotions, such as email “special deals” and surprise price reductions at the cash register.

Sales Promotional methods for the examples:

Price promotions

Price promotions are also commonly known as” price discounting”

These offer either (1) a discount to the normal selling price of a product, or (2) more of the product at the normal price.

Increased sales gained from price promotions are at the expense of a loss in profit – so these promotions must be used with care.

A producer must also guard against the possible negative effect of discounting on a brand’s reputation

Coupons

Coupons are another, very versatile, way of offering a discount. Consider the following examples of the use of coupons:

• On a pack to encourage repeat purchase
• In coupon books sent out in newspapers allowing customers to redeem the coupon at a retailer
• A cut-out coupon as part of an advert
• On the back of till receipts

The key objective with a coupon promotion is to maximize the redemption rate – this is the proportion of customers actually using the coupon.

One problem with coupons is that they may simply encourage customers to buy what they would have bought anyway. Another problem occurs when retailers do not hold sufficient stocks of the promoted product – causing customer disappointment.

Use of coupon promotions is, therefore, often best for new products or perhaps to encourage sales of existing products that are slowing down.

Gift with purchase

The “gift with purchase” is a very common promotional technique. It is also known as a “premium promotion” in that the customer gets something in addition to the main purchase. This type of promotion is widely used for:

• Subscription-based products (e.g. magazines)
• Consumer luxuries (e.g. perfumes)

Competitions and prizes

Another popular promotion tool with many variants. Most competition and prize promotions are subject to legal restrictions.

Money refunds

Here, a customer receives a money refund after submitting a proof of purchase to the manufacturer. These schemes are often viewed with some suspicion by customers – particularly if the method of obtaining a refund looks unusual or onerous.

Frequent user / loyalty incentives

Repeat purchases may be stimulated by frequent user incentives. Perhaps the best examples of this are the many frequent flyer or user schemes used by airlines, train companies, car hire companies etc.

Point-of-sale displays

Research into customer buying behavior in retail stores suggests that a significant proportion of purchases results from promotions that customers see in the store. Attractive, informative and well-positioned point-of-sale displays are, therefore, very important part of the sales promotional activity in retail outlets.

3. What are the major considerations involved in designing marketing  organisations in the following situations:

a)                   Large sized cement marketer with all India operations

b)                   Premium toy marketer focusing major Indian cities.    

Considerations in Organization Design

• Internal and External Organizations
• Vertical Structure
• Horizontal Relationships
• Speed of Response
• Managing the Operating Environment

Organizational Design Options

• Traditional Marketing Organizations
• New Forms of Marketing Organizations

Selecting an Organization Design

• Organizing Marketing Activities and Structure
• Marketing Environment and Structure
•  Innovativeness and Structure

Global Dimensions of Organizations

• Considerations in Global Organizations
• Types of Global Organization Structures

Organization structure is the formal and informal framework within which people work to achieve organizational objectives. Designing and implementing a suitable organization structure is necessary for the implementation of marketing strategy. Aspects like internal and external organizations, vertical structure, horizontal relationships, speed of response, managing the operating environment, etc. are the major considerations to be made in the design of a marketing organization. The options that are available for designing the marketing organization can be grouped into traditional structures and new forms. Traditional structures include functional, product, market, and matrix organizations. A functionally organized structure is organized on the basis of various functions like marketing, production, research and development, and finance. In product organization, structure is determined by the type and number of products that the organization has. Market organization is organized into geographical units that report to a central corporate headquarters. A combination or matrix organization is a combination of the functional and product forms of organization.

The matrix structure helps in achieving the advantages of each of these organizational structures. Types of matrix structures include functional matrix, project matrix, and balanced matrix structures.

In selecting an organization design, the factors that are to be considered include the market and environmental situation, organizational characteristics, and the marketing strategy generally adopted by the organization. Implementation of the marketing strategy is affected to a great extent by how the marketing activities are organized. There are basically four kinds of organizing concepts typically used in marketing – bureaucratic, transactional, corporate, and relational. The environmental condition also influences the structure adopted by the organization. Organizations operating in global environments have to design the structure keeping in mind the market conditions in which they operate. Global organization restructuring involves steps like identifying the need for restructuring, integration of organizational functions, and identifying the most effective structure. Multinational organizations go in for various structures like domestic organization, volume expansion, resource acquisition, and international division.

c)          Marketers’ consider packaging function as the 5^th element of Marketing Mix. Choose any two brands in the recent past and critically evaluate how packaging contributed largely to the success of the brand.

Packaging on Branded Food Products:

Packaging is not just a simple box; it is in fact a system for preserving the safety and quality of food products in transport, wholesale warehouses, and retail stores and in the home. It does this by:

·         Maximizing shelf life by acting as a barrier against water vapor, air, and microbes. Similarly, packaging also retains moisture and gases, which preserve product freshness and safety

·         carrying important information on the label (brand name, use-by dates, ingredients, refrigeration or cooking requirements, recipes, etc.) to help the consumer store products safely at home

·         providing evidence that the product is intact and has not been tampered with

·         preventing loss of aroma and protecting against odors from external sources

·         Bar codes on packaging identifying the date and the location of manufacture which enables processors, transporters and retailers to keep track of products for both inventory control and identification of potential hazards.

Diary Product Packaging:

Dairy packaging requires special care and attention. Different dairy products have different packaging options. But one important factor to consider is to maintain the freshness of the product. Packaging manufacturers and suppliers have come up with wide range of films, bags, laminates and equipment for packaging bulk dairy products, as well as, consumer portioned items, by considering such factors like protecting the flavors and textures throughout display and distribution.

Packaging is an integral part of the brand identity. The packaging of any dairy product should deliver consumer expectations of natural dairy taste and freshness, and should have a unique natural appeal and should extended shelf life. Dairy packaging has three main functions to perform:

• To contain the product.
• To protect the product.
• To sell the product.

Cosmetic brands:

There has been great innovation in cosmetic packaging. For all cosmetic care professionals, the packaging plays a vital role as it requires a high-quality packing. Various factors are to be considered for cosmetic packing like that it should resist the harmful chemicals, it should protect the product, the packaging should be strong and durable etc. Another important factor to consider for designing is the color as the colors used in the package reacts to the surface and the lights. The cosmetic packages designs are changing time to time to meet the demands of the customers.

It is to be noted in modern packing world, the same techniques of packaging applied by the architecture and automotive industry are also being implemented in the cosmetics industry. Different materials like metals, plastics, papers and glasses are bonded for cosmetic packing. Some companies use multi colored holographic effects. The bright and vibrant colored cosmetic packages are always preferred by the customers. While women go for bright colored package like orange, the male customer prefers packaging that is masculine and functional. The halo colors in cosmetic packing are said to be more feminine. The packaging should also look very attractive if it depicts cheerfulness and youth. The dark violet glass is recommended to protect the product from the light and organic contamination. The usage of lacquering has increased over the years. More interest is shown in glass-like packages among the customers.

The cosmetics, fragrance, toiletries, health and beauty aids industry is in the business of making people look, smell and feel beautiful. However, with the advent of many new regulations across the globe, the packaging for these products begins to look less and less attractive. The challenge for packaging designers and graphic artists is how to fit all of these new regulations on the package and still create innovative and appealing packaging.

The growing trend in the cosmetics industry is to have one package that fits all countries – a truly global product package. While this may seem like a good idea and even a very practical one, the task is complicated because even companies marketing similar products have different interpretations of what ‘global’ means. A cosmetics manufacturer can come close to achieving the objective of creating one package equally effective for their brand in every country if they understand global regulatory requirements and what aesthetic sacrifices might be required.

Apart from these marketing questions and general corporate structure or logistics issues, the packaging of cosmetics, fragrances and toiletries is regulated in one way or another by most countries. The similarities of the regulations are a start to help group countries together with a one-package-fits-all idea.

The following guidelines can be followed for cosmetic packaging:

• The cosmetic packages for liquid should have sophisticated dispensing services like pumps.
• The packages should depict quality and value.
• The packaging should be such that it can effectively act as the spokesman of the brand.
• It should be depict comfort and effectiveness.
• The cosmetic packing should not distract or surprise the customer.
• The graphics or pictures should play an important role in mass-packaging.
• An important guideline is that it should not be toxic.
• It should be economical.
• It should be recyclable.
• It should be free of preservatives.
• The packaging should be friendly to the environment

Electronic Brand Packaging:

Packaging is rapidly becoming an area of microelectronics technology, which can limit the operating speed on an integrated circuit. To address this concern, much research and development attention now focuses on packaging in an effort to prevent it from impeding the speed of electronic system.

Electronic packaging is defined as the electronic discipline of designing a protective enclosure for an electronic circuit so that it will both survive and perform under all environmental conditions. In the past, the term “electronic packaging” referred to a small number of formats for encasing electronic components, including integrated circuits, so they could readily and reliably be installed in electronic end-products. The principal packaging types was through hole, surface mount, tape automated bonding, and single-chip.

Production of high quality, low-cost consumer electronics product is dependent on proficiency in electronic packaging technologies. Continuous improvement of packaging and related technologies has provided the impetus for development of new and improved consumer product; likewise, consumer demand for new and improved electronic products at reasonable prices has provided the impetus for development of increasingly sophisticated electronic packaging. Packaging is important for signal and power transmission, heat dissipation, electromagnetic interference shielding and protection from environmental factors such as moisture, contamination, hostile chemicals and radiation.

4.  a) Given below is a list of products. What kind of distribution channel (direct or indirect) would you recommend for each of these products and why?

a)            Sanitary ware (Premium bath fittings)

Direct Mail 

Also known as a mail shot, this type of marketing can produce sales on a local, national, or even global, scale. The product would be sending out, say, flyers, leaflets, brochures or catalogues (often targeted to particular consumers) for selling. 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. Poorly targeted mail shots can also damage the image of your business, so be sure that you obtain/build appropriate mailing lists before you adopt the idea.

Direct mail can be complied and sent directly from your business, or you can use a professional service to distribute your information: at a much higher expense.

b)            Business Magazine (fortnightly publication)

Since the above mentioned product produced on a large scale, it may not be possible for him to sell goods directly to consumers. As such, the company sells goods through middlemen. These middlemen may be wholesalers or retailers. A wholesaler is a person who buys goods in large quantities from producers; where as a retailer is one who buys goods from wholesalers and producers and sells to ultimate consumers as per their requirement the involvement of various middlemen in the process of distribution constitute the indirect channel of distribution. Let us look into some of the important indirect channels of distribution.

Under this channel, the producers sell to one or more retailers who in turn sell to the ultimate consumers. This channel is used under the following conditions –

(i) When the goods cater to a local market, for example, breads, biscuits, patties, etc.

(ii) When the retailers are big and buy in bulk but sell in smaller units, directly to the consumers. Departmental stores and super bazaars are examples of this channel.

c)             OTC Product (Pain Balm)

Direct (on-site) 

 

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 type of distribution works only when your target consumers are within the local region and are not based on a wide geographical area.

4. b) Discuss the approaches to sales forecasting with suitable examples.

Top-Down Approach:

Proponents of top-down forecasting favor smoothing lower level data by aggregating it so that one can develop a better fitting model (the top level model will reflect a better R= value than lower level models). It is also felt that top-down models often reflect better accuracy for top-level forecasting. The problem is top-down models typically do a poor job of forecasting at lower forecast levels (e.g.: at the item per location level). The reason: aggregated data at the top level is an artificial representation of the true nature of the business because such data does not typically reflect sales low level "peaks and valleys," which are canceled by aggregation.

The basic problem with top level and low level data stems from the issue of variability.  Aggregated data at the highest level is smoother than lower level data and corresponds to lower percent differences about the means of individual time series at respective forecast levels. Thus, aggregation reduces variability. Interestingly, research indicates that top-level data reflects more randomness than lower level data. That is, top-level data, while smoothed, exhibits small random fluctuations. One should therefore realize that aggregation of sales data reduces data swings (reduces variability), but introduces random fluctuations (increases random-ness)

Bottom-Up Forecasting:

Proponents of bottom-up forecasting point to the fact that one can achieve a better mean absolute percent error (MAPE) value at the lower level. This is due in part to the fact that the lower level models reflect the actual nature of the business. A bias also has been documented in regression coefficients when aggregated data is used. While this supports a bottom-up approach, bottom-up forecasting often has very poor accuracy at higher forecast levels. This may be a result of forecast error at intermediate (middle) levels accumulating as data moves up to higher levels.

Bottom-up forecasts often have difficulty with top-level forecasting because the wide variability reflected at the lowest level 'introduces greater variability into the forecast, thereby widely under-forecasting or over-forecasting at the top-level. Bottom-up forecasts achieve a better MAPE at the lowest level because they reflect the actual demand pattern. In fact, individual item locations can have unique seasonality patterns - a top-down approach assumes that one seasonal pattern fits all. It is recommended that the forecaster investigate to see if individual items locations do indeed have similar seasonal patterns.

Naturally, choosing whether to use a top-down or bottom-up forecasting approach should depend on the objective driving why one forecasts. If the company uses forecasts to develop strategic plans and budgets then top-down forecasting would be preferable. Conversely, if production and distribution schedules (tactical side of the business) are driven by forecasts, then bottom-up forecasting would probably be a preferred choice. There are, of course, many companies that generate one forecast by reconciling top down and bottom-up forecasts.

Moreover, the results point to several tentative guidelines about employing top-down and bottom-up approaches:

• Top-down forecasting, appears to be most successful at low level forecasting when a non-seasonal top-level model is proportioned down and low level seasonal indices are used.
• When data are not seasonal at the lowest level, a top-level model with seasonal indices proportioned down to lower levels appears to be more successful.
• Bottom-up forecasting: appears to be most successful when the low-level data streams are homogeneous, i.e., low level data reflect the same patterns of seasonality and trend (which conceivably means that the same data patterns will be reflected at higher levels).
• Bottom-up forecasting appears not to work well when low level data are heterogeneous, i.e., low level data are comprised of different pattern fluctuations.

If you want Assignment Writing Help for MBA IGNOU Assignments-MS 06 Marketing for Managers, than contact mahasagarpublications.com