ASSIGNMENT-02

1. Theory Part:(A) Product Range- A set of variations of the same product platform that appeal to different market segments. A complete portfolio of products that a company

manufactures and/or markets.

(B) Pricing strategy- There are three main approaches a business takes to setting price: (i) Cost-based pricing: price is determined by adding a profit element on top of the cost of making the product. (ii) Customer-based pricing: where prices are determined by what a firm believes customers will be prepared to pa (iii) Competitor-based pricing: where competitor prices are the main influence on the price set

(C) Discount, rebates for consumers/ trade- Discounts and allowances are reductions to a basic price of goods or services. They can occur anywhere in the distribution channel, modifying either the manufacturers list price (determined by the manufacturer and often printed on the package), the retail price (set by the retailer and often attached to the product with a sticker), or the list price (which is quoted to a potential buyer, usually in written form). There are many purposes for discounting, including; to increase short-term sales, to move out-of-date stock, to reward valuable customers, to encourage distribution channel members to perform a function, or to otherwise reward behaviors that benefit the discount issuer. Some discounts and allowances are forms of sales promotion.

(D) Order taking process- When taking a customers order, the sales executive need to know the following things as a minimum: The customer contact information. The style, size and color of each garment. The location of the embroidery. The size of the embroidery. The colors of the embroidery. For Lettering font, size, style, height, color.

(E) Order form- its suggested that the sales executive use a different Order Form for each different item a customer orders. Customer Contact Information. Stock Design Information. Lettering Information. Layout Sketch. Customer Approval. Programmer Use.

(F) Delivery system- When a customer is considering buying a product he tries to access its value by looking at various factors which surround it. Factors like its delivery, availability etc which are directly influenced by channel members. Similarly, a marketer too while choosing his distribution members must access what value is this member adding to the product. He must compare the benefits received to the amount paid for using the services of this intermediary. These benefits can be the following:

Cost Saving. Time Saving. Customer Convenience. Customers can buy in small quantities.

(G) Credit system- Resellers offer financial programs to their customers which makes payment easier for the customer. Customers can buy on credit, buy using a payment plan etc.

(H) Scheduling - Scheduling is the process of deciding how to commit resources between a variety of possible tasks. (I) Sales Target Policy - Sales quotas are a fixture of sales compensation plans and are often associated with a significant discrete bonus. This paper shows that, under certain assumptions about salesperson utility and the distribution of sales outcomes, optimal compensation is a discrete bonus for meeting a sales quota. The results are similar when the assumption of agent risk neutrality is relaxed. The model has implications for many moral hazard problems where the agent has a liability limitation and job specific skill.

Analysis Part-

Here I have chosen the Nokia company for this assignment. . The company established in 1865 having its foundation in Finland. Nokia is one of the leading mobile communications in the world, it has 14 manufacturing plants throughout the world and they have 58,876 employees. The company owns R&D centers in Japan and China. Nokia mobile industrialized company plays a major role in India and have huge market share than other players. They have started its process in India in 1995 and have their offices in major cities like New Delhi, Mumbai, Chennai, Kolkata, Hyderabad, and Bangalore. They have increased their man power from 850 people to 15000 from the year of 2004 to 2008. And also they have targeting all class of people by releasing different kind of mobiles with different features. China started mobile services in 1988 whereas, India started mobile services in 1995. By 2001 India exceeded Chinas growth rate in mobile services. Achievements of Nokia: Nokia Company released first mobile with Hindi menu in 2000 They have come up with Wi-Fi mobile which is called Nokia communicator in 2004 In 2006 this company has started huge mobile manufacturing plant in Sriperambathur nearby Chennai. Nokia Company has joined with Malayalam Manorama to launch first Indias vernacular News.

1. Product range of Nokia-

The following is a list of products branded by Nokia Corporation. This list concentrates on the modern Nokia products. (a) Classic series The Mobira series Mobira Senator. Mobira Talkman 450. Mobira Cityman 900.

(b) Original series Nokia 1000. Nokia Ringo.

And the N series and E- series.

2. Pricing strategy of NokiaBy most accounts, India is among the world's fastest-growing markets for mobile phones. The country has some 170 million subscribers and adds 6 million to 7 million more each month. (China, in contrast, adds 5 million subscribers, and the U.S. 2 million subscribers a month.) Recognizing this potential, several global telecom giants jumped into the fray when the Indian government first opened up the country's telecom market to private enterprise in 1994. Among them, one company -- Finlandbased Nokia -- forged ahead of rivals and today commands a 58% market share for mobile phones (also called "handsets"). In specific segments, such as GSM telephony, Nokia's market share in India is as high as 70%. (GSM, which stands for Global System for Mobile, is the world's most popular standard for mobile

communications.).
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Neo Classic Nokia 6600

This model from Nokia was made available in 2003, complete with a colour screen, integrated camera and other contemporary features. In the beginning, the product was priced in the range of Rs. 21,000 22,000. By November 2004, it was available in the much lower, Rs. 15,000 16,000 range. The model is currently available for a price of Rs. 9000 10,000 only.

Modern Nokia 9500 Communicator

This is known as the snazziest model ever launched by Nokia in India. The Nokia 9500 communicator comes with office features and a large screen, coupled with increased memory and bluetooth technology. Available in the market since 2005, it was initially priced at Rs. 42,000, but can be currently bought for just Rs. 26,000. All the above models were produced in quick succession and Nokias strategy was to deliberately allow them to eat into each others market share. At the same time, Nokia proliferated the market with as many models as possible by 2006, at virtually every price point. Each one of Nokias models played a role in

catapulting Nokia to the top of the heap, in the Indian mobile handset market. It would be apt to map Nokias pricing strategy on the line of premium, high er value strategy, especially on the price-quality model.

On the flip side, consistent price cuts in rapid succession have the potential of smearing the brand image. But in the buoyant telecom sector, where change is the name of the game, the consumer is discerning enough to have a rational outlook towards a particular brand and its attributes, irrespective of the pricing strategy.

After all, skimming or no skimming, customer benefit is almost always guaranteed in a price-sensitive competitive market.

3. Order taking processNokia uses internet order taking. Internet order taking is a convenient call center service Nokia offer that allows the companys call center center operators to place orders directly on Nokia website or ecommerce interface. This organizes the order taking process by keeping all order, shipping, and status information on one spot. When the phone rings, orders are taken and entered directly into Nokias website. This is a perfect solution for businesses that already have their own site such as ecommerce businesses, catalog order companies, and others. Internet order taking is an important aspect of any product oriented business as each interaction can be a chance to sell Nokias products. If the customer have his afterhours calls going to an answering service that is a message and dispatch service or the customers calls are going to voicemail when the company is unable to get them, the company is losing money by losing potential sales. When Nokia outsource the order taking process to the internet order taking specialists at Specialty Answering Service, the company open up multiple lines of communication that it may have never had before. The company:

Monitor its web chat module on its website around the clock to ensure that people with questions who may not want to use the telephone for an answer don't need to. By interacting with its website visitors online through a live web chat platform, the company help convert customers that would otherwise be lost.

4. Delivery system-

Delivery system for GSM handsets- The handsets are transferred from Nokia Chennai manufacturing center to Gurgaon mother warehouse near Delhi and from there it is supplied through HCL distribution network to north and east part of India. HCL distributes to its regional distributors and from them to RDSS city and they will
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supply directly to the retailers but in the second channel called RDSS MD first, they will receive and send it to micro distributors and through them the handsets will reach retailers and then to its customers.

Delivery system for CDMA handsets- The delivery system for CDMA will be little different from GSM as there is a need for SIM from the mobile network operators. The CDMA handsets are manufactured and send to Nokias mother warehouse located in Gurgaon. And then from there it is delivered directly to the mobile network operators of India. There they will assemble their respective mobile networks SIM card and then send it to its own operators outlets and large distributors. The large distributors will further transferred to agents, chain of stores, etc. and finally it will reach the end customers. Nokia has a tie-up with TATA Indicom and Reliance network for its CDMA handsets.

5. Sales Target Policy-

Nokia uses the method of Territory Potential for setting sales quotas. Nokia first estimates the market potential for its product for a specific geographical area. Nokia uses top- down approach. Nokia also uses past sales for setting sales volume quotas. Nokia considers the past year sales of each territory, adds an arbitrary percentage and decides the figures as sales volume quotas.

6. Credit system:

The dealer representative will give the customer a $500 credit.

The customer will also receive a free MP3 player with the purchase of a Nokia

1680, Nokia 5000, Nokia 5130 or Nokia E63.

Each customer will be limited to a maximum of two (2) handsets per purchase.
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Phones, credits and gifts are available while stocks last. The customer will be able use your Loyalty Points to purchase the handsets on sale during the promotional period.2 You are required to have a minimum of 100 Loyalty Points in order to redeem the Points towards the purchase of a new handset. There is no warranty on the free gifts received.