Course: Principles of Marketing (470)
Semester: Spring, 2019
ASSIGNMENT No. 1
AIOU Solved Assignments 1 & 2 Code 470 Autumn 2019
Q.1 Describe the four activities which may be performed in the area of marketing. Explain how new marketing concept is different from the earlier marketing concept. (20)
Marketing Activities List:
Marketing activities impact virtually every product or service sold in the United States. These activities collectively form the “marketing mix” that describes how a company produces, prices, places and promotes a product or service within a market. A company that manufactures multiple products, or a service provider that offers services to different markets, often uses a different marketing mix for each offering. Each distinctive marketing program requires its own activities.
Product and Service Selection
A manufacturer or service provider ideally listens to its customers and prospects before making product and service decisions. Companies analyze consumer buying trends, conduct market research surveys and study competitors’ product sales experiences to learn what consumers desire or need.
For example, a convenience food company may expand its frozen dinner offerings after learning that time-squeezed customers want more quick-fix options. A cosmetics maker may create a new line of organic cosmetics after discovering that consumers are concerned about synthetic additives in makeup and skincare products. A certified public accountant may develop an affordable accounting service package to serve customers who value professional services but cannot afford the CPA’s standard rates.
Product or Service Pricing
Product or service pricing requires a company to analyze each commodity’s market, compare competitors’ prices for similar products or services and decide what price the market will accept. This calculated risk makes pricing activities an evolving art rather than an exact science. Businesses may also price a product based on the commodity’s status within the market.
For example, a company may introduce a new flavored coffee to a market with many other types of coffees. The company establishes a price in line with similar products, but offers introductory discounts to entice customers to try the product. If the market becomes saturated with coffee choices, the company may have to reduce its prices to move its inventory.
Product Placement Activities
Product placement activities refer to the methods a company uses to distribute its product to the marketplace. A beauty products catalog company, Internet jewelry company and interior design firm all use direct sales techniques to market directly to the end consumer.
Retailers such as clothing or appliance stores often conduct indirect sales activities when a manufacturer sells a product to the store. The store in turn markets the product to the consumer through store sales staff. In contrast, wholesale indirect sales methods channel a manufacturer’s product through a wholesaler. The wholesaler, who often represents multiple manufacturers, markets products to retailers for distribution to customers.
Incentives and Promotional Activities
Creating consumer demand for your product or service is the key to selling it. Product manufacturers and service providers promote a commodity by advertising in media designed to reach the product’s target audience. Sales promotional activities often accompany advertising campaigns and typically involve purchase incentives including customer loyalty cards, product discounts and gifts with purchase.
An effective public relations campaign helps promote the company, product or service through press releases and community event tie-ins. Some businesses also enhance their community standing by donating a percentage of sales or profits to a recognized charity.
Difference Between Old And New Concept Of Marketing
Old concept of market focuses to earn maximum amount of profit by selling large quantity of products. On the other hand, new concept focuses on customer satisfaction. There are some difference between these two concepts.
The differences between old and new concept of marketing are as follows:
The old concept of marketing gives emphasis to earn maximum profit by selling more and more products while the modern concept gives emphasis to provide maximum satisfaction to the customers and only then earn profit. Modern concept is customer-oriented whereas old concept is sales-oriented.
2. Integrated Process
According to the modern concept, marketing is a dynamic and integrated process in which it is not only necessary to have relationship among all the marketing activities, it is also essential to have proper plan of all activities and coordination among them. Modern concept gives more emphasis to the study of the needs, wants of customers and their behavioral system.
3. Marketing As A Social System
In the old concept of marketing more emphasis was given to selling. Searching future customers, giving information about goods or services to them, making them willingness to buy etc. are the functions of marketing. According to the modern concept, marketing is supposed to be a social system in which involves various business activities and functions. They remain affecting one another.
AIOU Solved Assignments 1 Code 470 Autumn 2019
AIOU Solved Assignments Code 470
Q.2 What do you mean by environment? Describe in detail the environments in which marketing has to operate. (20)
1. Truly understanding customers
Like any meaningful relationship, getting to know your customers well is a commitment. Tracking, analyzing, and interpreting customer behavior and attitudes should be an ongoing, often moment-to-moment undertaking that is critical not only to targeting and shaping relevant content and experiences but also to optimizing how they’re delivered—an important capability, given that during the buying process consumers add an average of 1.7 brands to those they are considering.2 This requires a wide range of data and sophisticated tools to analyzespecificcustomer segments and their behavior to spot opportunities and predict future actions. Companies should map detailed customer decision journeys for their most valuable segments, using technologies such as ClickFox,3 which track customers across channels to not only determine their cross-channel behavior but also isolate those moments where companies can influence the journey.
Feeding these insights into marketing operations requires processes and teams that focus on collecting and making sense of the data, as well as quickly delivering the analysis in a digestible form to the right decision makers—often continuously. Scaling this capability means organizations need to automate processes that don’t require human intervention, for example, personalizing web pages, delivering e-mail, or generating dashboards for managers to track customer behavior.
Most companies are only at the beginning of creating comprehensive customer-insights programs. While establishing “war rooms” to monitor and react to social-media conversations is a good example of how companies are moving in that direction, what’s needed are organizations that integrate and make sense of all sources of customer insights. One global hotel chain, for example, has combined its customer-research group and marketing-analytics group in an effort to better understand its customers—specifically, those who engage with their marketing, stay in their different hotels, and spend their money once there. These two groups have been combined into one insights team that reports directly to the chief marketing officer.
2. Delivering a superior experience
What happens when customers have a bad experience? They stop doing business with a company. And a souring of the customer experience can take place at any point, which is why getting the consumer journey right requires getting everything right. Meeting customer expectations calls for mapping out each of the steps that define the entire customer experience, highlighting not only the technologies and processes needed to enable a smooth journey but also the various functions across the organization that must coordinate to deliver it.
Marketing, sales, support, service, and operations play key roles in many customer journeys, of course. But there are other functions that are critical as well, such as order management and fulfillment. Those are not typically top of mind for marketers, but the experiences enabled by these back-end systems are instrumental to the way a customer perceives a brand’s ability to deliver on expectations.
Consider the technology and operations required for L’Oreal’s Makeup Genius app, which uses webcams to enable customers to virtually try on different shades and styles of makeup. To the customer, it is an easy, seamless, and enjoyable experience. But it is enabled by complex technology that involves coding dozens of makeup shades, matching them to a near infinite variety of skin tones, and collecting data on which types of customers try on which shades, then tracking their satisfaction levels after purchase—all of which are analyzed to further refine the matching process and improve the customer experience.
This two-way flow of information is an important aspect of modern marketing operations. As an experience is delivered to the customer, there needs to be a system to capture how that shopper responds and feeds that information back into the organization, which then adjusts its offer or message accordingly. And this feedback loop is not just about optimizing the customer experience. It also helps decision makers adjust campaign spending based on trends and opportunities, for example, or direct salespeople to stores where product inventory is low. We’ve found that best-in-class companies reallocate up to 80 percent of digital-campaign budgets during a campaign.4
3. Selecting the right marketing technology
Delivering on omnichannel customer experiences requires marketing technology that can automate processes, personalize interactions, and coordinate actions. Marketing technologists, in particular, have a critical role in navigating the ecosystem of more than 2,000 marketing-technology providers to create solutions that deliver the most effective customer experiences.5 They effectively act as a bridge between the customer experience and marketing operations.
An important element of managing a capable marketing-operations function is building a system that has the flexibility to work with large platforms that are becoming more dominant, such as Adobe or Oracle, as well as point solutions that are constantly introducing innovations. That requires developing a thoughtful application-programming-interface strategy to make sure your system has enough flexibility to hook into both current and emerging technologies, which will only become more important as the Internet of Things.
Beginning with a clear vision of its ideal customer-delivery needs, it defined key performance indicators, outputs, and levels of personalization, and then it set out to assemble the technology that could do it. But it also needed a solution that could play nicely with the company’s many legacy systems and would also be easy for a large group of global marketers to implement and manage day to day. The company wound up combining off-the-shelf data, content, and analytics platforms with a personalization engine.
4. Implementing processes and governance
Technology enables the customer experience, but it requires people, processes, and governance to ensure technology does what it’s supposed to do. The failure to establish guidelines for how business units might pilot new technologies, how data will be shared across the organization, or which capabilities will be managed in-house versus bexternal agencies and partners could result in a patchwork of efforts across the enterprise that sow confusion and hamper attempts to scale.
To address this challenge, one global consumer-packaged-goods company rethought its entire approach to bringing a new product to market, beginning with a complete overhaul of the marketing brief. The existing briefing process was not standardized, which resulted in varying levels of input, lack of clarity around the insights that were driving the campaign, loose definitions of the goals of the campaign, and inconsistencies regarding the specific role of each agency, as well as that of the internal team. As would be expected, much time was wasted as both the briefs and campaign development underwent multiple iterations.
The new approach required every agency involved in the product launch to participate in the creation of the briefs. Having everyone at the table formalized responsibilities, while aligning roles and resources ahead of time helped to mitigate the “land grabs” that can occur among competing agencies. In addition, bringing everyone together at the beginning made for stronger briefs, as it generated healthy debate on such key issues as which agencies would take the lead in the launch, which key performance indicators should be measured, and how and where to incorporate feedback loops that would allow teams to tweak and iterate after launch. The new approach paid off: the time spent writing a marketing brief and rolling out a new product dropped from four months to just one.
Establishing such clarity up front requires the client to be a strong orchestrator and the agencies to stick to their defined roles. Rather than being restrictive, this level of governance can enhance creativity, as it frees people to focus on their responsibilities instead of wasting time and energy jockeying for position with other agencies.
5. Using the best metrics to drive success
Technology is now catching up to the holy grail of marketing: the ability to monitor, track, and manage the effectiveness of marketing investments. Measures of marketing effectiveness need to move beyond what has often been limited to a narrow set of metrics. As companies become more customer-centric, for example, metrics should focus on customer activity rather than simply product or regional activity, as is often the case. Metrics should also reinforce new behaviors and processes, such as how fast a product is launched or how quickly lessons from the field can successfully be integrated into the next marketing offer.
To be most effective, however, metrics need to deliver insights quickly—often in real time—so the business can actually act. They need to be delivered in a way that is easy for decision makers to understand, and they need to be forward looking to identify future opportunities rather than focus on reporting what has already happened.
AIOU Solved Assignments 2 Code 470 Autumn 2019
AIOU Solved Assignments Code 470
Q.3 a) How is ‘consumer behavior’ affected by the following factors? (20)
“The effects of religion on consumer behavior: A conceptual framework and research agenda,” Journal of Consumer Psychology, April 2016), we offer a definition for religion and for each dimension, provide examples of existing measures of each dimension, integrate extant findings in the literature, and propose testable propositions for future research. Here, I will provide a brief overview of each dimension and consider how consumer scholars and marketers can use each dimension to better understand the underlying motivations behind certain consumer behaviors.
- Beliefs: Religious beliefs about sacredness differ between religions, sects, and denominations. For example, Catholics share beliefs about the afterlife, while Buddhists share beliefs about the impermanence of reality. These and other beliefs about the afterlife may provide a buffer against certain advertising strategies, such as fear appeals. Previously, consumer researchers have found that mortality salience (i.e., being reminded about the inevitability of death) induces death anxiety and causes individuals to buy more luxury products and status brands to cope with the fear of death and achieve symbolic immortality (Heine et al. 2002; Mandel & Heine 1999; Rindfleisch et al. 2009). However, religious beliefs about the afterlife may reduce death anxiety, thereby reducing the need for consumers to purchase luxury, branded goods when death is made salient. Therefore, certain fear appeals used in advertising and public service announcements may not be as effective at motivating the desired behaviors of individuals who score high (vs. low) on beliefs about the afterlife.
- Rituals: Rituals are symbolic, repeated behaviors that are performed in the same manner and order every time (Rook 1985), such as daily prayers or meditation, sacraments, holidays, and religious gatherings. Many religions have religious cleansing rituals to purify individuals from past transgressions or sins, such as confession for Catholics or wudu for Muslims.
consumer education can be expected to lead, in the long-run, to significant changes in consumer behavior. This paper contains a brief description of existing consumer education programs and a discussion of several hypotheses about how programs of this type could affect consumer behavior.
Interest in consumer education is growing rapidly. Within the last few months, a conference on consumer education has been held at the White House, an Office of Consumers’ Education has been established within the Department of Health, Education and Welfare, and courses in consumer education have been made mandatory for all high school students in several states. This growth of interest in consumer education can he attributed to the recent depressed economic situation and, to soma extent, the disappointing results achieved by certain consumer information programs
The Federal government has a host of agencies administering consumer education programs. Some of these agencies set up and run model programs for other organizations to copy. Other agencies produce and distribute consumer information materials which are used by the media to help design consumer education messages or by teachers to help instruct consumer education classes. Still other agencies are involved in stimulating additional interest in consumer education among educators, businessmen, and the general public through conducting workshops, symposiums, and seminars. Finally, there are a few agencies which distribute Federal funds to consumer education programs.
he Personal Factors are the individual factors to the consumers that strongly influences their buying behaviors. These factors vary from person to person that results in a different set of perceptions, attitudes and behavior towards certain goods and services.
- Age: The consumer buying behavior is greatly influenced by his age, i.e. the life cycle stage in which he falls. The people buy different products in different stages of the life cycle. Such as the purchase of confectionaries, chocolates is more when an individual is a child and as he grows his preferences for the products also changes.
- Income: The income of the person influences his buying patterns. The income decides the purchasing power of an individual and thus, the more the personal income, the more will be the expenditure on other items and vice-versa.
- Occupation: The occupation of the individual also influences his buying behavior. The people tend to buy those products and services that advocate their profession and role in the society. For example, the buying patterns of the lawyer will be different from the other groups of people such as doctor, teacher, businessman, etc.
- Lifestyle: The consumer buying behavior is influenced by his lifestyle. The lifestyle means individual’s interest, values, opinions and activities that reflect the manner in which he lives in the society. Such as, if the person has a healthy lifestyle then he will avoid the junk food and consume more of organic products.
These are some of the personal factors that influence the individual’s buying behavior, and the marketer is required to study all these carefully before designing the marketing campaign.
b) Describe the major characteristics of “Industrial market”.
characteristics of “Industrial market”.
Here are the characteristics of the consumer and the industrial market. These characteristics enable marketers to
identify and decide the kind of market to satisfy with their limited resources.
The characteristics refer to the qualities, different and similarities that make up the two markets.
(1) The market populations: the market populations or buyers in the consumers market are relatively larger than that of the industrial market. This is because the industrial market are characterized with fewer organizations that either into production or selling of goods and or rendering services, while the consumer market are the identified individuals of a larger population that buys goods and services for personal consumption.
(2)size of buyers: in the size of purchases, the industrial market is larger than the consumers market, the reasons are that; the industrial players buys in a very large quantities since they are into reselling or productions, but the consumers buys in little assorted quantities since their major aims is for personal or family consumptions.
(3) purchasing process: in terms of the processes that the two market undertakes in making a final purchase, the industrial market seems to be more strategic, systematic and well guided to compare to the consumer market, the reason is that players in the industrial markets are business minded, even in the nonprofit organizations, they equally guild their process for auditing reason. But the ultimate consumers are less strategic to compare with the industrial players.
(4) Level of relationships: there is always a closer relation that exists between an industrial marketer and his industrial buyers since the industrial buyers are fewer in size compare to the consumers market which are very large.
So if you are considering a target market to satisfy with the product you have to offer, then you can either choose to be an industrial supplier or satisfying the consumer market.
If you’re considering on the different type of market that exist for you as a marketer, seller or a business man, here are the two kind of market opportunities.
AIOU Solved Assignments Code 470 Autumn 2019
AIOU Solved Assignments Code 470
Q.4 Define a product also explain in detail the attributes of products. (20)
Define a product
Definition: A product
is the item offered for sale. A product can be a service or an item. It can be
physical or in virtual or cyber form. Every product is made at a cost and each
is sold at a price. The price that can be charged depends on the market, the
quality, the marketing and the segment that is targeted. Each product has a
useful life after which it needs replacement, and a life cycle after which it
has to be re-invented. In FMCG parlance, a brand can be revamped, re-launched
or extended to make it more relevant to the segment and times, often keeping
the product almost the same.
Description: A product needs to be relevant: the users must have an immediate use for it. A product needs to be functionally able to do what it is supposed to, and do it with a good quality.
A product needs to be communicated:Users and potential users must know why they need to use it, what benefits they can derive from it, and what it does difference it does to their lives. Advertising and ‘brand building’ best do this.
A product needs a name: a name that people remember and relate to. A product with a name becomes a brand. It helps it stand out from the clutter of products and names.
A product should be adaptable:with trends, time and change in segments, the product should lend itself to adaptation to make it more relevant and maintain its revenue stream.
A product attribute is a characteristic that defines a particular product and will affect a consumer’s purchase decision. Product attributes can be tangible (or physical in nature) or intangible (or not physical in nature).
Tangible attributes can include such product characteristics as size, color, weight, volume, smell, taste, touch, quantity, or material composition.
For example, when you want to buy a new car, you might consider tangible attributes such as its size, color, and material composition. If you are looking for a 2-door, red sports car with a leather interior, you are searching for a product based on its tangible attributes.
Intangible attributes may include such characteristics as price, quality, reliability, beauty or aesthetics, and je ne sais quoi (an indefinable, elusive pleasing quality).
Again, if you are looking to buy a new car, you might also consider intangible attributes such as price, quality, and safety test scores. If you want a new car that is relatively inexpensive but has garnered high marks on performance tests, you are searching for a product based on its intangible attributes.
Attributes and Consumer Preference
Attributes are the usual criteria by which a consumer will make a buying decision. Consumers have needs and wants. A need is something that a consumer must have, while a want is something that is desired, but not essential. A consumer will compare her needs and desires against the attributes of products available and select the product that best matches the needs and wants of the consumer.
AIOU Solved Assignments 1 & 2 Autumn 2019 Code 470
AIOU Solved Assignments Code 470
Q.5 Explain the importance of pricing. Describe the common pricing strategies followed by majority of business organizations. (20)
Price is both the money someone charges for a good or service and what the consumer is willing to give up to receive a good or service.
Buying something means paying a price. But what exactly is “price? ”
- Price is the money charged for a good or service. For example, an item of clothing costs a certain amount of money. Or a computer specialist charges a certain fee for fixing your computer.
- Price is also what a consumer must pay in order to receive a product or service. Price does not necessarily always mean money. Bartering is an exchange of goods or services in return for goods or services. For example, I teach you English in exchange for you teaching me about graphic design.
- Price is the easiest marketing variable to change and also the easiest to copy.
Even though the question, “How much? ” could be phrased as “How much does it cost? ” price and cost are two different things. Whereas the price of a product is what you, the consumer must pay to obtain it, the cost is what the business pays to make it. When you ask about the cost of a good or service, you’re really asking how much will you have to give up to get it.
various strategies that businesses implement when setting prices on their products and services.
1. Pricing at a Premium
With premium pricing, businesses set costs higher than their competitors. Premium pricing is often most effective in the early days of a product’s life cycle, and ideal for small businesses that sell unique goods.
Because customers need to perceive products as being worth the higher price tag, a business must work hard to create a value perception. Along with creating a high-quality product, owners should ensure their marketing efforts, the product’s packaging and the store’s décor all combine to support the premium price.
2. Pricing for Market Penetration
Penetration strategies aim to attract buyers by offering lower prices on goods and services. While many new companies use this technique to draw attention away from their competition, penetration pricing does tend to result in an initial loss of income for the business.
Over time, however, the increase in awareness can drive profits and help small businesses to stand out from the crowd. In the long run, after sufficiently penetrating a market, companies often wind up raising their prices to better reflect the state of their position within the market.
3. Economy Pricing
Used by a wide range of businesses including generic food suppliers and discount retailers, economy pricing aims to attract the most price-conscious of consumers. With this strategy, businesses minimize the costs associated with marketing and production in order to keep product prices down. As a result, customers can purchase the products they need without frills.
While economy pricing is incredibly effective for large companies like Wal-Mart and Target, the technique can be dangerous for small businesses. Because small businesses lack the sales volume of larger companies, they may struggle to generate a sufficient profit when prices are too low. Still, selectively tailoring discounts to your most loyal customers can be a great way to guarantee their patronage for years to come.
4. Price Skimming
Designed to help businesses maximize sales on new products and services, price skimminginvolves setting rates high during the introductory phase. The company then lowers prices gradually as competitor goods appear on the market.
One of the benefits of price skimming is that it allows businesses to maximize profits on early adopters before dropping prices to attract more price-sensitive consumers. Not only does price skimming help a small business recoup its development costs, but it also creates an illusion of quality and exclusivity when your item is first introduced to the marketplace.
5. Psychology Pricing
With the economy still limping back to full health, price remains a major concern for American consumers. Psychology pricing refers to techniques that marketers use to encourage customers to respond on emotional levels rather than logical ones.
For example, setting the price of a watch at $199 is proven to attract more consumers than setting it at $200, even though the true difference here is quite small. One explanation for this trend is that consumers tend to put more attention on the first number on a price tag than the last. The goal of psychology pricing is to increase demand by creating an illusion of enhanced value for the consumer.
6. Bundle Pricing
With bundle pricing, small businesses sell multiple products for a lower rate than consumers would face if they purchased each item individually. Not only is bundling goods an effective way of moving unsold items that are taking up space in your facility, but it can also increase the value perception in the eyes of your customers, since you’re essentially giving them something for free.
Bundle pricing is more effective for companies that sell complimentary products. For example, a restaurant can take advantage of bundle pricing by including dessert with every entrée sold on a particular day of the week. Small businesses should keep in mind that the profits they earn on the higher-value items must make up for the losses they take on the lower-value product.
Pricing strategies are important, but it’s also important to not lose sight of the price itself. Here are five things to consider, alongside your strategy, when pricing your products.
AIOU Solved Assignments Code 470