1. Executive PostGraduate Diploma in Management
Samrin Khan
Registration No - 2022EPGD05ASB007
Answer all three questions. Each question should not be more than 1 page. It should be typed in
Times New Roman with font size 11.
Q1. What are the three main categories of goods that are purchased by companies in industrial
marketing?
Answers :
Industrial marketing, also called business-to-business or B2B marketing, involves developing a
business relationship between those who sell the goods and those who buy them. The goal of
industrial marketing is often to reach contractual agreements for businesses to buy industrial goods
from a specific seller exclusively. Industrial marketers focus their efforts on specific clients and tailor
their marketing based on research and the company's individual needs. Industrial marketing involves
direct client contact, such as using e-mail, phone calls and face-to-face meetings to sell their products
to potential clients.
An industrial marketer can create added value by providing training of technical knowledge in an
efficient and effective way. This effective marketing not only helps to increase sales – it leads to the
creation of a more valuable asset, recognized brand something firms might want to sell someday.
Normally industrial marketing involves large orders and long-term relationships between the producer
and supplier, the process of transaction is too difficult or more complex than the transaction between
business to an individual customer.
The organization I work at i Disney Hotstar India Pvt Ltd.
2. The B2C sales has focuses on interactions between two parties.
Industrial Products can be classified in three broad categories:
1. Materials & Parts
2. Capital Items and
3. Supplies and Services
1 Material & Parts
These consists raw material, finished material & parts. Raw materials are generally farm
products namely cotton, wheat, vegetables etc. Some natural products like namely meat,
petroleum product, iron etc. whereas finished material and parts are items like iron rods,
linen yarns, wires and cables etc. and component and parts can be household appliance
motors, components of PC’s, component parts of motor vehicles etc
2 .Capital Items
The industrial products which assist the buyer’s production and operations are termed as capital
items. These include accessory equipments, installations or may be buildings, complex computer
systems. Some other items which can be added to this are the accessory equipment which can aid the
production Process.
For example, forklift trucks for material handling, equipments & furniture etc. These products like
forklift trucks for material handling, equipments & furniture etc., have a shorter life span than
buildings, complex computer systems as mentioned at the beginning.
3. Supplies & Services
This is also another type of industrial products and services in industrial marketing. This includes the
items that have a constant use in the plant or in office. Cleaning equipments, paints, pencils, printer
inks, photocopy papers, etc. are the convenience products and are purchased with no difficulty.
Maintenance and repair services are the items like window and furniture cleaning material computer
repair etc. There are also the business consultative services like legal, management consulting,
promotional etc. The needs and objectives of industrial buyers are satisfied through the following
exchange processes. There can be four different types of exchanges in industrial marketing.
3. Q2. Explain the three buying situations for a B2B purchase. Giving an example from your
experience, describe why strong relationship is a key factor in buyer-supplier relationship.
Ans : There are three main types of buying situations:
1) Straight rebuy- reordering the same product in the same quantity that one purchased
the last time.
2 ) Modified rebuy- reordering from the same company but with slight modifications.
3 ) New buy- when a company places an order with a certain supplier for the first time.
Companies resort to one of these buying situations depending on the following factors:
New buy is fundamentally different from modified rebuy and straight rebuy buying situations. Since
the order is being placed for the first time the process takes comparatively longer. The company has to
perform detailed analysis and research to understand which supplier’s offering best fits their needs.
Only after the detailed analysis will a company place its first order.
1. Straight Rebuy
In the case of a straight rebuy, the reorder specifications exactly match the specifications of the last
order. This is a routine affair, both the parties - supplier and company expect the order to be placed
and fulfilled on time. There is no room for any delays or confusion or misunderstanding.
To maintain this buying situation suppliers have to ensure timely delivery and consistent product
quality. This buying situation is also convenient for companies as they can skip the research process
and directly place the order.
2. Modified Rebuy
In modified rebuy, the company reorder from the same supplier but they modify some elements of
their order. The modification can be in terms of features, design, quality, packaging, quantity, or even
delivery time.
Modified rebuy can sometimes result in delayed delivery or a wrong supply of goods. Because of the
modification, the whole process can turn time-consuming.
4. Manufacturing Companies
5. Manufacturing companies rely heavily on suppliers to deliver their products on time. Any
delays in the delivery of raw materials can affect the entire supply chain. Therefore these
companies have to straight rebuy their orders for a specific project. Depending on the
duration or complexity of the project the order might eventually change, but for a short
period, the straight rebuy buying situation is being implemented.
6. Restaurants or Food Chains
4. 7. Restaurants need fresh produce and pantry staples delivered routinely. Most restaurants buy
fresh produce every day but the specific product, in this case, might change depending on
the season. But pantry staples like milk, flour, salt, sugar, pepper, etc are essential.
Restaurants definitely need a regular supply of them. So in this case the straight rebuy
buying situation can be implemented.
Factors Influencing Buyer-Seller Relationship
Efficient cooperation within a company requires a strong relationship between the buyer and the
supplier. A successful supply chain relies on well-established contact between buyer and supplier;
otherwise, further business will result in failure or ineffectiveness. Some factors are essential in terms
of building a successful communication chain.
Trust
The first and most important of them is trust. Trust, in many ways, forms the core of the relationship
between two parties. Trust can be identified as a willingness of one party to rely on their partner
confidently. It is is the main factor affecting the strength of any inter-organizational relationships
(Morsy, 2017). On the foundation of trust, most prosperous affairs are built; moreover, trust is an
expectation for every business partner that is made on the assumption of the company’s reputation,
reliability, and consciousness. It is one of the critical factors that influence the future of the
relationship between the buyer and the supplier. The best existing communication strategy is built on
the foundation of trust.
Commitment
Another essential factor in forming a prosperous buyer-supplier relationship is commitment.
Commitment among business partners exists as a permanent ambition to continually maintain the
ongoing relations. The degree of commitment shows both parties the willingness of each organization
to put in as much effort in their regards, and promises full assurance. Such actions result in mutual
benefits and sustaining satisfying relationships between both parties (Morsy, 2017). The primary
condition on which commitment should be built is when each partner is assured that the cooperation is
equally valuable for each side of this alliance.
Reputation
Spotless reputation is a significant factor in building a communication strategy between partners. The
supplier’s reputation can be the main decisive factor for the buyers in supply chains. It often becomes
the primary selection criterion when it comes to picking a business companion, as it may affect every
5. party involved in the relationship. Reputation represents a firm’s perception of the capabilities of
another organization (Morsy, 2017). A reputation is a crucial factor, as it becomes a valuable source
of trustworthiness that clients seek in their relationships. In searching for an appropriate partner,
reputation for performance and reliability becomes a vital measure when the partner is new and
untested.
Communication
One of the essential aspects of the buyer-supplier relationship foundation is communication. It is
common knowledge that communication is key to every successful working alliance, especially in the
business sphere. Buyer and supplier have to have mutual understanding and excellent communication
skills to achieve prosperous cooperation. They are not to avoid constant feedback and constructive
criticism as it is a fundamental tool on the path to improvements and innovations.
Common Goals
The partnership must be built on common goals. Provided excellent communication, common goals
are formed on the base of mutual need and interdependence. Moreover, shared goals are made to
create a sustainable relationship. To effectively work with any client, shared goals and intentions must
be set. Supplier development efforts should focus on future capabilities in technology and product
development rather than on current quality and cost (Sillanpää et al, 2015). Acknowledging that and
making those factors a clear common goal for both buyer and supplier can result in long-term fruitful
cooperation.
Strategy
A well-built communication strategy between the buyer and the supplier may set a mood for the
whole long-term partnership. Therefore, a supplier must carefully assess the situation and organize an
excellent strategy to build long-lasting cooperation with the buyer. According to Kurnia and
Wahjudono (2015), building a successful business partnership requires mutual benefits, mutual trust,
and interdependence between related parties. Forming a successful strategy is vital for any buyer-
supplier relationship. After a thorough analysis, a few of the most effective strategies were recognized
based on the factors that shape communicational patterns.
6. Q3. What are the basic steps in New Product development. Briefly describe how your
organization segments its customers. 7
marks
Answer : The basic Steps in New Product Developments:
Phase One: Idea Generation
This is the initial stage where a business sources for ideas regarding a new product. Some of the
sources for new product ideas include the business customers, competitors, newspapers, journals,
employees and suppliers. Small businesses may be limited when it comes to technical research-
based idea generation techniques. This stage is crucial as it lays the foundation for all the other
phases, the ideas generated shall guide the overall process of product development.
Phase Two: Screening
The generated ideas have to go through a screening process to filter out the viable ones. The
business seeks opinions from workers, customers and other businesses to avoid the pursuit of costly
unfeasible ideas. External industry factors affecting small businesses, such as competition,
legislation and changes in technology, influences the enterprise's decision criteria. At the end of the
screening process, the firm remains with only a few feasible ideas from the large pool generated.
Phase Three: Concept Development
The enterprise undertakes research to find out the potential costs, revenues and profits arising from
the product. The business conducts a SWOT analysis to identify the strengths, weakness
opportunities and threats existing in the market. The market strategy is set out to identify the
product's target group, which facilitates segmentation of the product’s market. Market segmentation
is important as it enables the firm to identify its niche. The identified niche influences most of the
marketing decisions.
Phase Four: Product Development
Product development entails the actual design and manufacture of the product. Development
commences with the manufacture of a prototype that facilitates market testing. Based upon the
results of the tests, the business owner decides on whether to undertake large-scale production or
not.
Phase Five: Commercialization and Rollout
Favorable results in the development stage precede large-scale production and commercialization.
Here, the business launches its promotion campaign for the new product. The market research
conducted during the conception stage influences the timing and location of the product launch.
My organization: Disney Hotstar
Disney + Hotstar is one of the top streaming platforms in India owned by Novi Digital Entertainment
Private Limited which is of Disney Star and operated by Disney Media and Entertainment Distribution,
both divisions of The Walt Disney Company.
It offers TV content and movies in multiple languages and major sports events live. It offers affordable
mobile or TV/laptop subscription plans but also the option to consume limited free content on the
platform.
7. Business and Revenue Model
Disney+ Hotstar is a hybrid TVOD (transactional video on demand) and SVOD (subscription video on
demand).
Here are three major categories of their earnings —
1. Advertising on Hotstar : Hotstar generates the bulk of its revenues through advertising. The
company has been improving its advertising capabilities to attract more advertisers and increase ad
spending. 70% of the revenue comes from advertisers wanting to advertise on a cricket platform during
IPL.
2. Subscription Model
Hotstar offers two types of subscriptions — monthly or annual — both priced at different prices.
Hotstar competes directly with Netflix and Amazon Prime Video with this subscription model. They
offer similar pricing for their services in India (although both companies have yet to launch here). This
means that Hotstar needs to ensure its content offering is sufficiently attractive for consumers to choose
it over competitors.
3. Hotstar Personalized Ads: Hotstar has a lot of things going for it. It’s the only place to watch IPL
matches in India, and their new personalized ads are a big hit with fans.The company is also
experimenting with personalized ads while IPL streaming to see if they can get people to buy products
they see on TV during matches.
