1. a) Explain six criteria for effective market segmentation. Segmentation is the basis for developing effective targeted groups.

Segmenting is where the marketer splits the market into groups and targets the relevant group.

Six criteria for effective market segmentation are as follows: 1) Identity: The marketing manager must have some means of identifying members of the segment i.e., some basis for classifying an individual as being or not being a member of the segment. There must be clear differences between segments. Members of such segments can be readily identified by common characteristics as they display similar behavior. 2) Accessibility: it must be possible to reach the different segments in regard to both promotion and distribution. In other words, the organization must be able to focus its marketing efforts on the chosen segment. Segments must be accessible in two senses. First, firms must be able to make segmented customers aware of products or services. Second, they must get products to them through the distribution system at a reasonable cost. 3) Responsiveness: a clearly defined segment must react to changes in any of the elements of the marketing mix. For example if a particular segment is defined as being cost conscious it should react negatively to prices. If it does not, this an indication that the segment needs to be redefined. 4) Size: the segment must be reasonably large to be a profitable target. It depends upon the number of people in it and its purchasing power. 5) Nature of demand: it refers to the different quantities demanded by various segments. Segmentation is required only if there are market differentiation in terms of demand. 6) Measurability: the purpose of segmentation is to measure the changing behavioral pattern of consumers.

b) Discuss the types of target marketing strategies. A target market is defined as a set of buyers sharing common needs or characteristics that the company decides to serve. It is very important to select the target market, which the company decides to serve because knowledge about how the consumers decide, what are the characteristics and lifestyle of the targeted customers help the marketers to develop a suitable marketing strategy. The targeting strategy largely depends on the kind of product market coverage that the firm plans for future. The product market coverage strategies are broadly classified as undifferentiated marketing, concentrated marketing, and differentiated marketing strategies. Mass Marketing Strategy: In the absence of proper mechanism to classify the market into a number of market segments and analysis their potential, many firms decide on the mass marketing strategy. In the case, the marketer goes against the idea of a differentiated market and decides to sell the product to the whole market. This strategy keeps the overall marketing costs low and makes it easier to manage and track the market forces uniformly. The marketer tries to find out commonalities across various segments rather than focusing on the differences between segments. Concentrated marketing strategy: The marketing manager decides to enter into a selected market segment instead of all the available market segments. When resources and market access are limited and the company has to face intense competition, the marketing manager has to stretch the budget for market coverage. In this case, the company is likely to follow the concentrated marketing strategy. Differentiated Marketing Strategy: many marketers choose to target several segments or niches with a differentiated marketing offer to suit each market segment. Maruti is the leading automobile company, which has the distinction of having different products for different market segments.

2.

Explain the consumer buying decision process.

Consumer buying decision process is explained trough a number of stages and is influenced by ones psychological framework comprising the individuals personality, learning process, levels of motivation, perception towards products and brands, and formation of positive attitude towards the brand. The figure below depicts the process of consumer decision making process in detail.

NEED

Learned Needs Non Specific Motive

Born Needs

Motive

Specific Motive

Problem recognition

Information Search Evaluation Of Alternatives Purchase Decision

Internal Search

External Search

Cognitive Evaluation

Affective Evaluation

Buy Later

Do Not Buy

PURCHASE

Post Purchase Behaviour

Satisfaction

Dissatisfaction

HABIT FORMATION

Problem recognition: A buying process starts when a consumer recognizes that there is a substantial discrepancy between his/her current state of satisfaction and expectations in a consumption situation. A need can be activated through internal or external stimuli. The basic need of common men rises to a particular level and become a drive. From their previous experiences they know how to satisfy these needs like hunger, thrust etc. this ia a case of internal stimulus.

Information search: after need arousal the behavior of the consumer leads towards collection of available information about various stimuli. In this case the information about the products and services are gathered from various sources for further processing and decision making. The marketer will find it worthwhile to study the consumers information sources when: o A substantial percentage of target market engages in the search o The target market shows some stable patterns of using the respective information sources. Alternative evaluation: once interest in the product is aroused, a consumer enters the subsequent stage of evaluation of alternatives. An evaluation leads to formation of buying intention that can be either purchased or reject the product or brand. The final purchase will however depend on the strength of the positive intention which is the intention to buy. Purchase decision: Finally the consumer arrives at a purchase decision. Purchase decisions can be any one of three no buying, buying later, and buy now. Post purchase behavior: Post purchase behavior refers to the behavior of consumers after their commitment to a product has been made. It originates out of consumers experience regarding the use of the product and is indicated in terms of satisfaction. This behavior is reflected in repeated purchases or abstinence from further purchase. A satisfied product use experience leads to repeated purchase, referrals from satisfied customers to new customers, higher usage rate and also brand advocacy.

3.

A) Discuss Henry Assael model of buying decision Behavior.

Types of Buying Decision Behavior: Henry Assael Model: Henry Assael has come up with an explanation to analyze why consumers buy the goods they buy. He explained the relationship between the level of involvement by the consumers in purchase of goods and services and the level at which diverse goods and services differ from one another. He therefore came up with four different buying behaviors as explained:

High Involvement

Low Involvement

Significant differences between brands

Complex Buying Behavior

Variety Seeking Buying Behavior

Few differences between brands

Dissonance Reducing Buying Behavior

Habitual Buying Behavior

Complex Buying Behavior Consumers are highly involved in a purchase and aware of significant differences among brands. This is usually the case when the product is expensive, bought infrequently, risky and highly self expressive. Typically the consumers dont know much about t he product category and have more to learn. Example: Computers, laptops etc. Dissonance Reducing Sometimes, the consumer is highly involved in a purchase but sees little differences in the brands. The high involvement is based on the fact that the purchase is expensive, infrequent, and risky. Habitual Buying Behavior Many products are brought under conditions flow consumer involvement and the absence of significant brand differences. Considering salt, consumers have little involvement in this product category. They go to the store and reach for the brand. If they keep reaching for the same brand, it is out of habit and not strong brand loyalty. Variety Seeking Buying Some buying situations are characterized by low consumer involvement but significant brand differences. Here consumers do lot of brand switching. Consumers do the brand switching for the sake of variety rather than dissatisfaction.

B) Explain five stages of Adoption Process.

Adoption Trial Evaluation Interest Awareness

A large number of factors are examined to know the reaction of consumers regarding adoption of a new product. The process of accepting new product ideas by individual customers is popularly known as ADOPTION PROCESS. Awareness the product innovation is explained to the consumers. This process gives information about the new product or services.

Interest when consumers develop interest in the product or product category, they search for information about how the innovation can benefit them. Evaluation the evaluation stage represents the kind of mental trial of the product innovation. Only if consumers evaluation of the i nnovation is satisfactory, they will actually try the product. In case the evaluation is unsatisfactory, the product is automatically rejected. Trial in this stage consumers use the product on limited basis. Their experience with the product provides them with the critical information that they need to adopt or reject it. Adoption in this stage, consumers decide to make full and regular use of the product.

4.

Describe the components of the micro environment of marketing.

The market environment is a marketing term and refers to factors and forces that affect a firms ability to build and maintain successful relationships with customers. Micro (internal) environment - small forces within the company that affect its ability to serve its customers. The micro environment refers to the forces that are close to the company and affect its ability to serve its customers. It includes the company itself, its suppliers, marketing intermediaries, customer markets and publics. The COMPANY aspect of microenvironment refers to the internal environment of the company. This includes all departments, such as management, finance, research and development, purchasing, operations and accounting. Each of these departments has an impact on marketing decisions. For example, research and development have input as to the features a product can perform and accounting approves the financial side of marketing plans and budgets. The SUPPLIERS of a company are also an important aspect of the microenvironment because even the slightest delay in receiving supplies can result in customer dissatisfaction. Marketing managers must watch supply availability and other trends dealing with suppliers to ensure that product will be delivered to customers in the time frame required in order to maintain a strong customer relationship. MARKETING INTERMEDIARIES refers to resellers, physical distribution firms, marketing services agencies, and financial intermediaries. Resellers are those that hold and sell the companys prod uct. They match the distribution to the customers and include places such as Wal-Mart, Target, and Best Buy. Physical distribution firms are places such as warehouses that store and transport the companys product from its origin to its destination. Marketing services agencies are companies that offer services such as conducting marketing research, advertising, and consulting. Financial intermediaries are institutions such as banks, credit companies and insurance companies. Another aspect of microenvironment is the customers. There are different types of customer markets including consumer markets, business markets, government markets, international markets, and reseller markets. The CONSUMER MARKET is made up of individuals who buy goods and services for their own personal use or use in their household. Business markets include those that buy goods and services for use in producing their own products to sell. This is different from the reseller market which includes businesses that purchase goods to resell as is for a profit. These are the same companies mentioned as market intermediaries. The government market consists of government agencies that buy goods to produce public services or transfer goods to others who need them. International markets include buyers in other countries and includes customers from the previous categories.

5.

A) Explain the types of Marketing Information systems

MIS supplies three types of information, those are: Monitoring Information: Monitoring information is the information obtained from scanning external sources which includes newspapers, trade publications, technical journals, magazines, directories, balance sheets of the companies, and syndicated and published research reports. Data are captured to monitor changes and trends related to marketing situation. Some of these data can be purchased at a price from commercial sources such as market research agencies or from government sources. Recurrent Information: Recurrent information is the information that is generated at regular intervals like monthly sales reports, stock statements, trial balance etc. In MIS, recurrent information is the data that MIS supplies at weekly, monthly, quarterly, or annual interval, which are made available regularly. It can also provide information on customer awareness of companys brands, advertising, campaigns, and similar data on close competitors. Customized Information: Is also called problem related, which is developed in response to some specific requirements related to marketing problem or any particular data requested by manager. B) Discuss the different components of MIS. "A marketing information system is a continuing and interacting structure of people, equipment and procedures to gather, sort, analyze, evaluate, and distribute pertinent, timely and accurate information for use by marketing decision makers to improve their marketing planning, implementation, and control". Internal reporting systems: All enterprises which have been in operation for any period of time nave a wealth of information. However, this information often remains under-utilized because it is compartmentalized, either in the form of an individual entrepreneur or in the functional departments of larger businesses. That is, information is usually categorized according to its nature so that there are, for example, financial, production, manpower, marketing, stockholding and logistical data. Marketing research systems: Marketing research is a proactive search for information. That is, the enterprise which commissions these studies does so to solve a perceived marketing problem. In many cases, data is collected in a purposeful way to address a well-defined problem (or a problem which can be defined and solved within the course of the study). The other form of marketing research centers not on a specific marketing problem but is an attempt to continuously monitor the marketing environment. Marketing intelligence systems: Whereas marketing research is focused, market intelligence is not. A marketing intelligence system is a set of procedures and data sources used by marketing managers to sift information from the environment that they can use in their decision making. Marketing intelligence is the province of entrepreneurs and senior managers within an agribusiness. It involves them in scanning newspaper trade magazines, business journals and reports, economic forecasts and other media. In addition it involves management in talking to producers, suppliers and customers, as well as to competitors. Nonetheless, it is a largely informal process of observing and conversing. Marketing models: Within the MIS there has to be the means of interpreting information in order to give direction to decision. These models may be computerized or may not. Typical tools are: Time series sales modes Brand switching models Linear programming Elasticity models (price, incomes, demand, supply, etc.) Regression and correlation models Analysis of Variance (ANOVA) models Sensitivity analysis

 Discounted cash flow Spreadsheet 'what if models

6.

Describe the factors to be considered while developing an Effective marketing mix.

To develop an effective marketing mix the company should consider the following factors and then choose the most appropriate mix of elements to target the customers. Companys resources: these are one of the prime factors affecting the companys marketing mix. The financial, human, and technological resources available with the company affect the composition of the marketing mix. The firm needs to conduct strength, weakness, opportunity and threat analysis for the business unit. Demographics: It implies to the change in the composition of the market, the demand of the population, the opportunities in the country, etc. that affect the marketing mix. Current and projected economic conditions: it connotes the economic factors like inflation, employment, taxes, and other economic factors that influence marketing mix decisions. Market potential: Analysis of market potential for new products considers market growth, prospects need for your offering, the benefits of the offering, and the number of barriers to immediate use, the credibility of the offering and the impact on the customers daily operations. Competitors: They are important considerations that affect the marketing mix of a firm as the potential for competitive retaliation is based on the competitors resources, commitment to the industry, cash position, predictability, and status of the market.