Q1. A firm selling electric brooms in a matured market is looking to increase its sales.

It hires a
new consultant who suggests that the firm can increase use of its products among customers in a
mature market by adopting some marketing practices. Suggest few marketing actions that this
firm can take to increase its sales in a mature market.

Pointers to Answer

a.) Change the model/launch new variants

b.) Design the product to expire(shorten the useful economic life of the product)
c.) Develop new product uses
d.) Improve packaging for better ease of use
e.) Increase quantity per use occasion
f.) Make the product easier to use

Q2. When a vacuum cleaner marketing firm was about to launch an ambitious sales
promotions, it was advised that there are several negative effects that price promotions
can have on a firm. Discuss few of such negative effects.

Pointers to Answer
a.) Brand image – the promotion negatively affects the brand, especially upscale brands
b.) Diversion – retailers and/or distributors may divert the product to non-competing
outlets, often in different geographic areas
c.) Hidden costs – frequent price promotion can be difficult and costly to administer
d.) Poor forecasting – when demand exceeds forecast the customers are likely to get
upset.
e.) Time-shifting – customers may buy for inventory to avoid paying the full price later.

Q3. Procter & Gamble has several product brands such as Sure (underarm deodorant), Crest
(toothpaste), Tide (laundry detergent), Cascade (dishwater detergent), and Pringles (snack food),
Bounty, Crest, Duracell, Gillette, Pampers, Tide and others. On the other hand, Yamaha sells a
variety of electronic musical instruments, such as keyboards and guitars, traditional instruments
such as pianos, motorcycles, and even Grand Prix engines under its company name.

Pointers to Answer
In a multi-branding strategy, the firm (e.g., P&G) selects an individual brand name or names for each
of the various product categories in which it competes. As a result of this strategy, target customers may
have a high recognition of the firm’s various brands(may be required also due to nature of competition),
but be relatively unaware of the firm itself. By contrast, a firm (e.g., Yahama) pursuing an umbrella
branding strategy employs a single brand for its various products, either because it may be handling
lower number of product lines, or high product brand recognition at each category level may not be so
necessary.

Q4. P&G has a premium diaper brand ‘Luvs’. P&G also has as lower priced brand ‘Pampers’
which directly competes with private-label diapers. Similarly, Intel introduced lower-priced
Celeron to compete with lower priced micro-processors. Why do firms such as P&G launch
products in same category under different brand rather than going for line extension under the
same brand?
Pointer to Answer
Lower-price defender brands often protect premium-priced high-quality brands from price competition,
and also maintains the brand-equity of premium brands by reducing the erosion of its brand equity to
due to price competition.