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SET – 2
Q.1 Write a short note on product life cycle.
Answer to question 1:
Product life cycle management is the succession of strategies used by management as a
product goes through its product life cycle.The conditions in which a product is sold changes
over time and must be managed as it moves through its succession of stages.
Price
• The money charged for a product or a service
• Cost is incurred to the supplier/producer in supplying/producing the product
• Price is paid by the buyer to acquire the product
Pricing Products
• The amount of money charged for a product or service, or the sum of the values that consumers
exchange for the benefits of having or using the product or service
• Price is the only element in the marketing mix that produces revenue; all other elements
represent cost.
• Price is also one of the most flexible elements of the marketing mix.
Pricing Products
• The most common mistakes in setting prices are;
pricing that is too cost oriented
prices that are not revised often enough to reflect market changes
pricing that does not take rest of marketing-mix into account
Marketing Management -MB0030
BIDYUT ROY Roll No:510916600
prices that are not varied enough for different products, market segments &
purchase occasions
Product Mix
• Total composite of products offered by a particular organization
• Consists of both product lines and individual products
• Product line is a group of products within the product mix that are closely related, either because
they function in a similar manner, are sold to the same customer groups, are marketed through
the same types of outlets, or fall within given price ranges.
Product lining is the marketing strategy of offering for sale several related products. Unlike product
bundling, where several products are combined into one, lining involves offering several related products
individually. A line can comprise related products of various sizes, types, colors, qualities, or prices. Line
depth refers to the number of product variants in a line. Line consistency refers to how closely related the
products that make up the line are. Line vulnerability refers to the percentage of sales or profits that are
derived from only a few products in the line.
The number of different product lines sold by a company is referred to as width of product mix. The total
number of products sold in all lines is referred to as length of product mix. If a line of products is sold with
the same brand name, this is referred to as family branding. When you add a new product to a line, it is
referred to as a line extension. When you add a line extension that is of better quality than the other
products in the line, this is referred to as trading up or brand leveraging. When you add a line extension
that is of lower quality than the other products of the line, this is referred to as trading down. When you
trade down, you will likely reduce your brand equity. You are gaining short-term sales at the expense of
long term sales.
Image anchors are highly promoted products within a line that define the image of the whole line. Image
anchors are usually from the higher end of the line's range. When you add a new product within the
current range of an incomplete line, this is referred to as line filling.
Price lining is the use of a limited number of prices for all your product offerings. This is a tradition started
in the old five and dime stores in which everything cost either 5 or 10 cents. Its underlying rationale is that
Marketing Management -MB0030
BIDYUT ROY Roll No:510916600
these amounts are seen as suitable price points for a whole range of products by prospective customers.
It has the advantage of ease of administering, but the disadvantage of inflexibility, particularly in times of
inflation or unstable prices.
There are many important decisions about product and service development and marketing. In the
process of product development and marketing we should focus on strategic decisions about product
attributes, product branding, product packaging, product labeling and product support services. But
product strategy also calls for building a product line.
Companies will attempt to increase the amount customer spend once they start to buy. Optional 'extras'
increase the overall price of the product or service. For example airlines will charge for optional extras
such as guaranteeing a window seat or reserving a row of seats next to each other.
Where products have complements, companies will charge a premium price where the consumer is
captured. For example a razor manufacturer will charge a low price and recoup its margin (and more)
from the sale of the only design of blades which fit the razor.
Item made specifically for use with another item, usually from the same manufacturer. For example,
shaving blades for a razor, parts for a machine, software for a computer or operating system. Pricing of
captive product is often based on a product-mix pricing strategy where a low mark-up is set for the
companion main product (such as a razor or operating system) with a high mark-up for the supplies (such
as blades or application software).
By product pricing:
• Setting a price for by products in order to make the main products price
competitive
• Product bundle pricing: - Combining several products & offering the bundle at a
reduced price - e.g. Combo deals
Logistics has evolved as a common and well-known business concept because of the ever increasing
complexities of modern day business. The primary goal of logistics is to effectively manage the project
life cycles and resultant efficiency. This has greatly evolved with a logistics manager's role in
efficiently designing the products of the company keeping in view the principle of efficient system of
supply chain management.
In business terms, it can be summarized as a competitive strategy adapted by the enterprise to meet
and exceed the expectations of its existing and prospective customers. It refers to a complete process
of total supply chain management that is established to achieve a state of perfection through
efficiency and integration. Logistics does not mean a single work activity but refers to a group of
activities performed to attain the goal of a business enterprise that is maximizing the Profits. This may
involve steps like purchasing, planning, coordination, transportation, warehousing, distribution and
customer service. A business can run without profits, but it needs money to fund its services, pay its
employees and grow its customer base. Logistics play an important part in the present business world;
it cannot be neglected by an enterprise focused on growth and profitability.
Marketing Management -MB0030
BIDYUT ROY Roll No:510916600
Logistics refers to various functions associated with the organizational disciplines of planning,
managing and controlling the flow of goods and services, people and related information. It includes all
the steps that are required to achieve the timely delivery of a product, goods or services from the
point of origin to the point of destination.
As per the Council of Logistics Management, logistics has been defined as the part of the process of
supply chain that plan, control and implement an effective and efficient flow for the purpose of storage
of goods and services and other related information from the point of commencement to the point of
final consumption with a aim to satisfy the requirements of its existing and prospective customers.
All activities that are involved in the movement of goods and services from the point of origin to the
point of final consumption are grouped under the term 'logistics'. The art of managing or supervising
all these activities when grouped together as a collective unit, are placed under 'logistics
management'. People who are authorized or given the task of managing the aspect of logistics
management are referred to as 'distribution managers' or 'logistics managers'.
Logistics can be referred to as an enterprise planning network used for the purpose of information,
material management, capital flows. In the words of a layman, it can be described as delivering at the
right time, for the right price and in the right condition. When seen in the modern day competitive
business scenario, it includes complex information along with importance to the control and
communication systems of the organization. No matter the size and the area of operations of an
organization, logistics information plays an important role in the achievement of the goals of the
organization.
Functions of Logistics: Logistics has evolved in the present very competitive business environment
and is primarily concerned with the efficient and effective management of the project life cycles of the
organization and its resultant efficiencies. It can be described as a complete process that involves the
total supply chain management that is formed for the purpose of achievement of common business
objectives of the organization. The role of a logistics manager and executive has changed in a
significant manner and they are now entrusted with the task of not only ensuring delivery of products
and services, internally or externally in the organization's premises, but also to ensure the
development of logistics systems for optimal utilization of the available resources of the organization
beside the achievement of business goals.
Logistics does not refer to a single activity performed for delivery of goods, it extends to delivery of
goods at the right time, at the right place, in the right condition and at the right price. The logistics
manager ensures that no fraud is committed during the logistics process and the logistics systems run
in accordance with the predefined plans and policies of the organization. An effective and efficient
logistics system ensures the smooth functioning of the organization and it is rightly considered as an
integral part of the plans of the organization.
Logistics business plan The plan must be clearly defined so that there is no confusion in the minds of
the logistics team. This clarity will help to accomplish the desired objectives of the organization. It
must be drafted in accordance with the objectives of the organization. Its aim must be to provide
timely delivery of goods besides rendering normal functions of logistics under strict deadlines and in
conformity with business goals.
marketing campaigns or programs, from search engine optimization (SEO), pay-per-click, affiliate,
email, banner to latest web related channels for webinar, blog, micro-blogging, RSS, podcast, and
Internet TV. Offline marketing channels are traditional print (newspaper, magazine), mail order, public
relations, industry relations, billboard, radio, and television. A company develops its integrated
marketing communication program using all the elements of the marketing mix (product, price, place,
and promotion).
Integrated marketing communication is integration of all marketing tools, approaches, and resources
within a company which maximizes impact on consumer mind and which results into maximum profit
at minimum cost. Generally marketing starts from "Marketing Mix". Promotion is one element of
Marketing Mix. Promotional activities include Advertising(by using different medium), sales promotion
(sales and trades promotion), and personal selling activities. It also includes internet marketing,
sponsorship marketing, direct marketing, database marketing and public relations. And integration of
all these promotional tools along with other components of marketing mix to gain edge over
competitor is called Integrated Marketing Communication.
The goal of selecting the elements of proposed integrated marketing communications is to create a
campaign that is effective and consistent across media platforms. Some marketers may want only ads
with the greatest breadth of appeal: the executions that, when combined, provide the greatest number
of attention-getting, branded, and motivational moments. Others may only want ads with the greatest
depth of appeal: the ads with the greatest number of attention-getting, branded, and motivational
points within each.
Although integrated marketing communications is more than just an advertising campaign, the bulk of
marketing dollars is spent on the creation and distribution of advertisements. Hence, the bulk of the
research budget is also spent on these elements of the campaign. Once the key marketing pieces have
been tested, the researched elements can then be applied to other contact points: letterhead,
packaging, logistics, customer service training, and more, to complete the IMC cycle.
distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational
goals." The broad definition takes into account all parties involved in the marketing effort: members of
the organization that produces goods and services, resellers of those goods and services and
customers or clients.
Virtually all businesses realize that marketing plays a crucial role in their success. Marketing texts
initially had a strong bias towards packaged consumer goods, which no doubt are important; yet they
overlooked consumer services, industrial goods and services, advanced technology products, non-
profit enterprises, and government agencies. Today, marketing has greatly come in play with semi-
conductors, commercial banking, industrial chemicals, health care, computer integration services,
agricultural equipment, government services, and many other products outside the consumer
mainstream.
Any company is faced with marketing challenges, even the market leaders. Many of these challenges
rely upon perception of the market. Thus Marketing is required. In most of these cases advertising
helps, but that is the most expensive method.
The unknown alternative solution Your solution addresses a common problem differently but nobody
knows. What to do: - Create awareness by press releases, industry analysts and bloggers - Start
blogging in order to get attention - Improve the SEO of your website in order to be found on the
Internet - Create content related to your solution in order to be found on the Internet - Be present on
trade shows and on conferences on a tight budget
• By taking a product global, a firm will have more success if they adapt it specifically to the
location and culture that they are trying to market it in.
Pepsi’s Glocalization
Pepsi forms joint venture when first entering India with two local partners, Voltas and Punjab Agro,
forming “Pepsi Foods Ltd”.
In 1990, Pepsi Foods Ltd. changed the name of their product to “Lehar Pepsi” to conform with foreign
collaboration rules.
In keeping with local tastes, Pepsi launched its Lehar 7UP in the clear lemon category.
Advertising is done during the cultural festival of Navrartri , a traditional festival held in the town of
Gujarat which lasts for nine days.
Pepsi’s most effective glocalization strategy has been sponsoring world famous Indian athletes, such
as cricket and soccer players.