Marketing notes


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Notes for marketing students... as per syllabus of GTU Nov. 2011

Marketing notes

  1. 1. MARKETING NOTES For 5th Semester Engineering students As per GTU syllabus Nov. 2011
  2. 2. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comIndex: Pg. 3 Pg. 11 Pg. 17 Pg. 23 Pg. 24 Pg. 29Reading Tips: • These notes can be best read on a PC with an internet connection, but if you don’t have one, reading with your copy of Kotler will also be sufficient. • Below the titles of each module, you can click the URL to view the ppt that was covered in class. Alternatively, you can click the following URL to find all the ppts at one place: • The small colored text box on the right shows the page number in your Kotler (13th edition) where you may find the related topics. • The URLs at the bottom of each page shows the sources from where the corresponding theories have been taken. You can click on them to visit the source websites, if you want. • Marketing is fun to learn..! Happy reading and all the best..! 2
  3. 3. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com1. Introduction to MarketingBefore reading this module, spare 10 mins and go through my ppts at: is Marketing?The process of planning and executing the conception, pricing, promotion and distributionof offers (ideas, goods and services) to create exchanges that satisfy individual andorganisational objectives. Kotler 13e pg. 4Marketing in society1:Socio-cultural factorsThe social&-cultural environment relates to the attitudes of members of society towardgoods and services as well as pricing, promotion, and distribution strategies Societydemands that business be concerned with the quality of life, which has broadened thesocial impact of marketing. More specifically the social&-cultural environment has thefollowing influences: (1) It influences the general readiness of society to accept a newmarketing idea; (2) the publics trust and confidence in business as a whole influencelegislation regulating business and marketing; and (3) although it affects domesticmarketing it is an even more critical factor in international marketing. Consumerism is thesocial force within the environment designed to aid and protect the consumer by exertinglegal, moral, and economic pressures on business. Consumer rights include: (1) the right tochoose freely; (2) the right to be informed; (3) the right to be heard; and (4) the right tobe safe.Describe the role of marketing in society.Marketing operates in an environment external to the firm. These environmentalrelationships exist with customers, employees, the government, vendors, and society as awhole. They form the basis of the societal issues that confront contemporary marketing.Marketings relationship to its external environment has a significant effect on the relativedegree of success the firm achieves. Marketers must continually find new ways to deal withthe social issues facing our competitive system.Identify the two major social issues in marketing.Current issues in marketing include marketing ethics and social responsibility. Marketingethics are the marketers standards of conduct and moral values. Social responsibility is themarketers acceptance of the obligation to consider profit consumer satisfaction, andsocietal well&-being of equal value in evaluating the performance of the firm.The Marketing Concept2: Kotler 13e pg. 14,20The marketing concept holds that the key to achieving organizational goals consists ofbeing more effective than competitors in integrating marketing activities towarddetermining and satisfying the needs and wants of target markets.1 source: source: 3
  4. 4. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comThe marketing concept rests on four pillars: target market, customer needs, integratedmarketing, and profitability.Target marketNo company can operate in every market and satisfy every need. Nor can it always do agood job within one broad market.Customer needsMarketing is about meeting needs of target markets profitably.The key to professional marketing is to understand their customers’ real needs and meetthem better than any competitor can.Some marketers draw a distinction between responsive marketing and creative marketing.A responsive marketer finds a stated need and fills it. A creative marketer discovers andproduces solutions that customer did not ask for but to which they enthusiastically respond.Integrated MarketingWhen all the company’s departments work together to serve the customer’s interests, theresult is integrated marketing. Integrated marketing takes on two levels. First, the variousmarketing functions-sales force, advertising, product management, marketing research,and so on – must work together.Second must be well coordinated with other company departments.The company is doing proper marketing only when all employees appreciate their impact oncustomer satisfaction. To foster teamwork among all departments, the company carries outinternal marketing as well as external marketing. External marketing is marketing directedat people outside the company. Internal marketing is the task of successfully hiring,training, and motivating employees who want to serve the customers well. In fact internalmarketing must precede external marketing. It makes no sense to promise excellentservice before the company’s staff is ready to provide excellent service.ProfitabilityThe ultimate purpose of the marketing concept is to help organizations achieve their goals.In the case of private firms, the major goal is profit. Marketing managers have to providevalue to the customer and profits to the organization. Marketing managers have to evaluatethe profitability of all alternative marketing strategies and decisions and choose mostprofitable decisions for long-term survival and growth of the firm.Basic Functions of Marketing3: Kotler 13e pg. 281. Buying:-This is an important function of marketing and occupies much of the time of both businessundertaking and consumers. This may be relatively simple or exceeding complex whetherthis function is conducted by the manufacturer, the wholesale or the retailer. In the presenteconomic stage, the success of business depends on the effective purchasing system. Solarge business concerns have separate purchasing department, may have experienced staffof buyers. The buying function includes the determination of needs, the selection of proper3 source: 4
  5. 5. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comsource of supply, title from the seller to the buyer. The buying function includes thedetermination of needs, the selection of proper source of supply, title from the seller to thebuyer.2. Selling:-Selling is indispensable function of every marketing and is basic reason for the operation ofbusiness concerned that more sales must be obtained at less cost. But this function, isexpensive because it involves many activities i.e. creating demand, finding buyer,negotiating price and transferring the title.3. Assembling:-Assembling is the physical act of putting together and collection of goods to obtain largerquantities of similar goods. It is more essential in case of marketing of agriculturecommodities which are generally grown in similar quantities by larger number of producersin territories spread over vast areas.Concentration of raw material is necessary for theregular supply of the standardized materials because these are used in large volume bymanufacturers.4. Standardizing and Grading:-Standardizing involves the determination of basic measure or limits to which articles beingstandardized. To standardize into give performance to grades.Grading is an reality a part of standardization. It is process which tests the conformity ofcommodities to standards that have been previously set up. Product of agriculture and theextractive industries are usually graded according to general standard. Grading may bebased on shape, size, color, strength, appearance,specific gravity and chemical contents.5. Packaging and Packing:-Packing is meant the placing of goods in small packages i.e. can or bottles etc. It may beregarded as an aspect of marketing because it has a considerable influence on sales in thedomestic consumer market.Packing is concerned with the wrapping and crating necessary for the transport or storageof goods. Many goods must be packed in order to be preserved or delivered to the buyers.6. Dividing:-Dividing is an other important function of marketing. As the wholesale require the productin large units according to the requirements of retailers. But retailer require the products insmall quantity so they divide the stock into small units according to the need of customers.It enables the businessmen to reduce the bulk of commodities in order to take them morereadily transportable.7. Storage or Warehousing:-Storage is a major marketing function which involves the utilization of substantialmanpower and capital resources. The ultimate consumer finds it necessary to purchasesome goods in advance of need and to store them for the future use.On the other hand,goods are produced in large quantities in anticipation of future demand and for theunknown customers. Warehouses are required to store the goods for the adjustment ofsupply to demand. 5
  6. 6. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com8. Transportation:-Transportation involves all kinds of movement of persons and goods from one place toanother. It is the function of transportation to convey commodities from places where theirutility is relatively low to places where it is higher. Because of the nature of naturalresources, variations in climatic conditions, concentration of skilled or unskilled labor, largescale manufacturing, and raised or manufactured largely or exclusively in certain places.The principal economic basic for transportation is the enhancing the value of goods by thecreation of place utility. Thus effective transport is indispensable to economic progress.9. Financing:-The whole modern production and marketing mechanism is based on credit and money. Noperson can think of conducting business without sufficient finance. There is wide gapbetween the production of goods and consumption of goods. So the product, distributingand consuming require large funds. When a retailer sells commodities on credit, he isrendering a financing services. He may, in part shift this function back on the wholesalerwho has extended credit to him, while the wholesaler, in return, may pass part of burdenback to the credit granting manufacturer.10. Risk Taking ( Insurance ) :-When the goods are sent by the seller to the buyer through rail, road and ship, there maybe risk of loss. The goods may be lost or damaged or destroyed by sea perils, flood, fire,theft, storm and change in the temperature. The businessman and other exporters think,therefore, in terms of minimizing these risks by shifting them on others shoulders. Soinsurance provides safety against any unforeseen circumstances and ways to the businesspeople to cover losses or dangers.11. Market Informations:-As the demand for various products in national or international market have raised, theamount of information needed has also regarding trademark, quality go goods, method ofpacking, test and fashion of consumer nature of demand, prices to considerably increased.It helps a businessman to secure information regarding trademark, quality of goods,method of packing, test and fashion of consumer nature of demand, prices of goods areprocedure of distribution. There are various method and ways by which such investigationsand experiment may be conducted. It thus enables the producers to formulate and to carryout selling policies.Model for making marketing decisions4: Kotler 13e pg. 49Traditionally, marketing researchers were responsible for providing the relevant informationand marketing decisions were made by the managers. However, the roles are changing andmarketing researchers are becoming more involved in decision making, whereas marketingmanagers are becoming more involved with research. The role of marketing research inmanagerial decision making is explained further using the framework of the "DECIDE"model:The DECIDE model conceptualizes managerial decision making as a series of six steps. Thedecision process begins by precisely defining the problem or opportunity, along with theobjectives and constraints. Next, the possible decision factors that make up the alternative4 source: 6
  7. 7. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comcourses of action (controllable factors) and uncertainties (uncontrollable factors) areenumerated. Then, relevant information on the alternatives and possible outcomes iscollected. The next step is to identify and select the best alternative based on chosencriteria or measures of success. Then a detailed plan to develop and implement thealternative selected is developed and put into effect. Last, the outcome of the decision andthe decision process itself are evaluated.The role of marketing managers5:For the small business, there are several different organisational approaches to marketing.The duty may lie with a single member of the team, or it could be a group responsibility.The great thing about a small team is the ability to quickly instill a marketing led ethoswhich can become the operational soul of your business.Depending on budget availability and the skills of the team, you may chose to outsourcecertain elements of the marketing process (such as market research) or decide to do thesejobs in-house. Key responsibilities of the marketing manager / director vary according tothe business but can include: • Instilling a marketing led ethos throughout the business5 source: 7
  8. 8. Notes for marketing students of SSESGI (for private circulation only) © • Researching and reporting on external opportunities • Understanding current and potential customers • Managing the customer journey (customer relationship management) • Developing the marketing strategy and plan • Management of the marketing mix • Managing agencies • Measuring success • Managing budgets • Ensuring timely delivery • Writing copy • Approving images • Developing guidelines • Making customer focused decisionsThe marketing role can be diverse or focused but now well elaborate further on some keyaspects which should be at the heart of the job.Identifying and selecting markets6:Segmentation is very important to identify and select markets. In segment marketingcompanies identify consumer with similar needs and wants. For example, an airline islooking forward to providing no frills’ connectivity between metro cities on US east coastcompare. This segment is within airline industry but needs of customer is different. T targetaudience is low budget travelers. However, customers within the segment look for differentattributes, for example, lunch or beverages as part of travel. Here companies can offer thisby charging the customer.In niche marketing, companies target limited customer set. A niche market is worthexploring where customers are willing to pay a premium for product, entry barriers are highand market has growth potential. In local marketing, customers are local neighborhood,trading stores, etc. For example, many banks prefer local marketing for betterunderstanding of client and provide them right type of service. In individual marketing,companies look forward to satisfying needs and wants of individual customer. Internet isfacilitating the process of individual marketing, where in customer log on to the site andcreates products from available options. This process is not feasible for high technologyproducts like automobiles.The market segmentation task has to follow a scientific process. The first task is to group customer according to product and service they want. The second task is to analyze customer by summarizing demographic, lifestyle and usage pattern, which helps in the definition of market segment. The third task is due diligence of the market for growth potential, competition and other factors. The fourth task is to profitability of market segment. The fifth task is to undertake positioning activity for pricing and marketing programs.6 source: 8
  9. 9. Notes for marketing students of SSESGI (for private circulation only) © The sixth task is to explore different positioning and marketing strategies to explore the market to its full potential. Kotler 13e pg. 144Consumer Behavior7:For a detailed presentation, visit the following ppt: behaviour is the study of when, why, how, and where people do or do not buy aproduct. It blends elements from psychology, sociology, social anthropology andeconomics. It attempts to understand the buyer decision making process, both individuallyand in groups. It studies characteristics of individual consumers such as demographics andbehavioural variables in an attempt to understand peoples wants. It also tries to assessinfluences on the consumer from groups such as family, friends, reference groups, andsociety in general. Please read Kotler for more on this topic.Key Terms used in marketing:Market segmentationA group or sector within a heterogeneous market consisting of consumers or organisationswith relatively homogeneous needs and wants.Market positioningMarketing activity intended to place a product into a desired position in a market and tohave it perceived in that way by consumers.Market researchThe systematic and objective identification, collection, analysis and dissemination ofinformation for the purpose of assisting management in decision making related to theidentification and solution of problems (and opportunities) in marketing.Market research processA set of six steps that define the tasks to be accomplished in conducting a marketingresearch study. These include problem definition, developing an approach to the problem,research design formulation, fieldwork, data preparation and analysis and report generationand presentation.AdvertisingThe paid, public non-personal announcement of a persuasive message by an identifiedsponsor; the non-personal presentation or promotion by a firm of its products to its existingand potential customers.PromotionPromotion is usually composed of a "promotional mix, which includes Advertising PersonalSelling Sales Promotion and Publicity (Marketing Public Relations). Some time Directmarketing is also singled out as a separate element.7 source: 9
  10. 10. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comPricingMarketing activity concerned with the setting of prices for new products and the adjustmentof prices for existing products.PlaceOne of the four controllable variables (with product, price and promotion) of the marketingmix; the delivery of a good or service to a consumer; also referred to as Distribution. SeeDistribution; Marketing Mix.ProductSomething that is viewed as capable of satisfying a need or want. Also referred to as avalue offer or offer.ConsumerThe ultimate user of goods, ideas or services. The most generic and all-encompassing termfor an organisation’s targets.BrandCustomer or user experience represented by images and ideas, often referring to a symbol(name, logo, symbols, fonts, colours), a slogan and a design scheme. A perception of anintegrated bundle of information and experiences that distinguishes a firm and/or itsproduct offerings from the competitionBrand imagePerceived impressions of a brand by market segments.Brand positioningThe distinctive position that a brand adopts in its competitive environment to ensure thatindividuals in its target market can tell the brand apart from others.ChannelThe means used by firms to make their products (goods and services) available to theirtarget market... examples include direct channel (sold by the companys sales force),distributors, retail stores, manufacturer’s reps and value added resellers.Marketing Mix: 4 Ps (product, price, place, promotion)Services Marketing Mix:7 Ps (4Ps + people, physical evidence and processes)Promotional Mix (Advertising, Public Relations, Publicity, Sales Promotion, Direct Marketing)Product Mix: Sum total of all products and variants offered by the organization 10
  11. 11. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com2. Marketing ResearchBefore reading this module, spare 10 mins and go through my ppts at: scope8: Kotler 13e pg. 63Marketing research9 is "the function that links the consumer, customer, and public to themarketer through information — information used to identify and define marketingopportunities and problems; generate, refine, and evaluate marketing actions; monitormarketing performance; and improve understanding of marketing as a process. Marketingresearch specifies the information required to address these issues, designs the method forcollecting information, manages and implements the data collection process, analyzes theresults, and communicates the findings and their implications."[1] Marketing research isthe systematic gathering, recording, and analysis of data about issues relating to marketingproducts and services. The goal of marketing research is to identify and assess howchanging elements of the marketing mix impacts customer behavior. The term is commonlyinterchanged with market research; however, expert practitioners may wish to draw adistinction, in that market research is concerned specifically with markets, while marketingresearch is concerned specifically about marketing processes.[2]Marketing Research can be classified as: 1. Basic research 2. Applied research8 Read the full article at: Source: 11
  12. 12. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comIt can also be classified as:a) Problem solving research • Segmentation research • Product research • Pricing research • Promotion research • Distribution researchb) Problem identification research. • Market potential research • Market share research • Image research • Market characteristics research • Forecasting research • Business trend researchSources of information: Kotler 13e pg. 63, 71, 74Primary SourcesIn-Person, Interview, E-Mail contact, Event, Discussion, Debate, Community Meeting,Survey, Artifact, Observation of object (animate and inanimate)Secondary SourcesReference Material, Book, CD Rom, Encyclopedia, Magazine, Newspaper, Video Tape, Audio,Tape, TV, Government records, Syndicated research dataExecuting Marketing Research Studies10: Kotler 13e pg. 8910 source: 12
  13. 13. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comProblems of accuracy and Data analysis: Kotler 13e pg. 89Data Accuracy11 is the most important as it represents all business activities, entities andevents. Two important requirements should be met for a data to be accurate. First, it hasto be or the right value. Second, it has to precisely represent the value in consistent formin accordance with the business data model and architecture.There are several sources and causes of data inaccuracy. The most common of thesecauses come from initial data entry of users. In simple terms, it means that the userentered the wrong value. This could also be that typographical errors were committed. Thisis an aspect that can be overcome by having skilled and trained person do the data entry.Or since mistakes can happen to everybody, data inaccuracy from data entry can beovercome by having programmatic components in the application detect typo errors. Forinstance, many applications have spell checks or some web forms like combo boxes offer alist of possible values there can be no mistake in typing.Data Decay can lead to inaccurate data. Many data values which are accurate can becomeinaccurate through time; hence data decay. For example, peoples addresses, telephonenumbers, number of dependents and marital status can change and if not updated, thedata decays into inaccuracy.Data Movement is another cause of inaccurate data. Data warehouses extract, transformand load data very frequently within a short period. As data moves from disparate systemto another, it could be maybe altered to some degree especially if the software running thedatabase is not very robust.Analysis of data12 is a process of inspecting, cleaning, transforming, and modeling datawith the goal of highlighting useful information, suggesting conclusions, and supportingdecision making. Data analysis has multiple facets and approaches, encompassing diversetechniques under a variety of names, in different business, science, and social sciencedomains.Several analyses can be used during the initial data analysis phase: • Univariate statistics • Bivariate associations (correlations) • Graphical techniques (scatter plots)It is important to take the measurement levels of the variables into account for theanalyses, as special statistical techniques are available for each level:[12] • Nominal and ordinal variables o Frequency counts (numbers and percentages) o Associations circumambulations (crosstabulations) hierarchical loglinear analysis (restricted to a maximum of 8 variables)11 source: source: 13
  14. 14. Notes for marketing students of SSESGI (for private circulation only) © loglinear analysis (to identify relevant/important variables and possible confounders) o Exact tests or bootstrapping (in case subgroups are small) o Computation of new variables • Continuous variables o Distribution Statistics (M, SD, variance, skewness, kurtosis) Stem-and-leaf displays Box plotsMarketing Research Reports:Components of a research report13:Title PageThe title page includes the title of the report, name and address of the researcher and theorganization conducting the research, the name of the client and the date research report isbeing submitted. The title should be concise, clear and crisp indicating the nature of theproject.Transmittal LetterThis part of a formal research report is usually developed at the end. The transmittal letterintroduces the research report to the recipient of the report. And can draw attention toparticular project characteristics, contractual obligations or noteworthy conclusions, and assuch can generate interest in the subject matter of the report.Letter of AuthorizationA letter of authorization is a letter which was written by the client or person who wantedthe research to be done to the researcher authorizing him to start research for the writer. Acopy of the letter is enough to be included in the report.Table of ContentsThe table of contents lists major report topics and subtopics (sections, chapters,appendices etc.) and their beginning page numbers. It varies from being very detailed toconsisting of general topic headings only. Usually the major headings and subheadings areincluded in the table of contents. The table of contents is followed by a list of tables, list ofgraphs, list of appendixes, and list of exhibits, if any, if the report is lengthy.Executive SummaryThe executive summary is an important part of the report, as this the only portion of thereport that executives often read. The executive summary should be written after the restof the report has been completed. An executive summary is a mini report within the report.It is not simply a brief of the report but it is a distillation of the research project outliningthe methodology, major findings, and conclusions. An executive summary is a bottom-linereport created for decision makers who have no time or desire to go into the project’stechnical details.13 source: 14
  15. 15. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comBODY—TEXTUAL PARTSIntroductionTo begin with the body of the report, an introduction to the research background,discussions with the client and possibly the industry expert to find the direction of doingresearch to solve this management problem. This part provides a clear statement of theresearch problem and objectives/questions/hypotheses of the research. After reading thissection, one can understand the reason and rationale for conducting this studyResearch Design and MethodologyA complete understanding and evaluation of a project depends on the researchmethodology used. Methodology which ranges –from sampling frame and procedures, tomode of data collection, to research instrument, to techniques of data analysis employed—should be described adequately. Who collected data and how fieldwork was organized andmonitored to ensure the quality of data collection is explained in this section. Secondarydata collection methods and sources are also discussed in this sectionData PresentationThis section may contain several chapters or subsections showing data analysis in the formof tables, description, graphs etc. Data analysis is quantitative, qualitative or both. Thispart of the body is critical for the research project as the ultimate results and conclusions ofthe report are based on data analysis.ResultsAs stated earlier, results may comprise several chapters or sub-sections. Most of the time,the results are presented both at the aggregate and the subgroup level, for example,market segment, market area, wholesale, retail level.Tables and graphs may highlight the results with the main findings discussed in the text.The results should be organized in a coherent and logical way.The standard formats that are used to arrange data in the tables are:Alphabetically.Chronologically.Geographically.According to sizeAccording to interest of the reader.According to tradition.According to importance.Conclusions and RecommendationsThis part of the report gives the main findings, conclusions and recommendations for theorganization. A summary of the statistical findings is not enough. The researcher needs todiscuss the results in light of the management problem being addressed to arrive at majorconclusions. Based on the results, the researcher may give some suggestions to thedecision makers. Sometimesmarketing researchers are not asked to recommend anythingbut confine themselves to giving their finding and conclusions.LimitationsAfter the conclusions and recommendations component of the research report, limitationsof the research are mentioned. Limitations may originate due to time, budget or someother organizational constraints. No research project is without shortcomings. A researcheris ethically and professionally bound to fully disclose the shortcomings or setbacks of the 15
  16. 16. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comresearch that may have an impact on its validity, reliability, or predictability. Sometimeslimitations are given before the conclusions and recommendation section so that thereaders should know the limitations of findings and conclusions.Guidelines for VisualsIn the research report, visuals may be used for enhancing the understanding of the report.Mostly these include tables, charts and graphs, maps, figures and flow charts. Theguidelines for preparing and using these visuals are:Make visual aids simple and convenient to understand.Primary objective of including such visuals should be to augment the clarity andunderstanding of the content of the report. .End Matter or Supplementary PartsThis is the section of the report which contains ‘too material’. It includes any material thatthe researcher thinks should also be included in the report to aid the understanding of thereader. It is in the form of appendixes which are labeled as Appendix A, B, C etc. andcontain the headings as well. These appendixes may range from a blank copy ofquestionnaire to price lists, tables, diagrams, statistical illustrations, photographs etc.General GuidelinesType or print on one side only of heavy, white, unrolled paperPaper size: 8½ X 11 inchesDouble-space the entire paperLeft justify text onlyLeave a minimum one-inch margin on the sides, top, and bottom of each pageNumber pages consecutively in the top right corner, beginning with the title pageJust before the page number, use a shortened form of the title as a headerFont size 12-pointTimes Roman or Courier are acceptable typefacesOnly black tonerIndent paragraphs 5-7 spacesNo more than 27 lines of text per pageFor sample reports, visit: 16
  17. 17. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com3. Product Policy & Marketing MixBefore reading this module, spare 5 mins and go through my ppt at: Product Mix14: Kotler 13e pg. 308, 321The product mix of a company, which is generally defined as the total composite ofproducts offered by a particular organization, consists of both product lines and individualproducts. A product line is a group of products within the product mix that are closelyrelated, either because they function in a similar manner, are sold to the same customergroups, are marketed through the same types of outlets, or fall within given price ranges. Aproduct is a distinct unit within the product line that is distinguishable by size, price,appearance, or some other attribute. For example, all the courses a university offersconstitute its product mix; courses in the marketing department constitute a product line;and the basic marketing course is a product item. Product decisions at these three levelsare generally of two types: those that involve width (variety) and depth (assortment) of theproduct line and those that involve changes in the product mix occur over time.The depth (assortment) of the product mix refers to the number of product items offeredProduct Life Cycle15: Kotler 13e pg. 292, 260Like human beings, products also have a life-cycle. From birth to death, human beings passthrough various stages e.g. birth, growth, maturity, decline and death. A similar life-cycle isseen in the case of products. The product life cycle goes through multiple phases, involvesmany professional disciplines, and requires many skills, tools and processes. Product lifecycle (PLC) has to do with the life of a product in the market with respect tobusiness/commercial costs and sales measures. To say that a product has a life cycle is toassert three things:14 source: source: 17
  18. 18. Notes for marketing students of SSESGI (for private circulation only) © • Products have a limited life, • Product sales pass through distinct stages, each posing different challenges, opportunities, and problems to the seller, • Products require different marketing, financing, manufacturing, purchasing, and human resource strategies in each life cycle stage.The four main stages of a products life cycle and the accompanying characteristics are:Market introduction stage 1. costs are very high 2. slow sales volumes to start 3. little or no competition 4. demand has to be created 5. customers have to be prompted to try the product 6. makes no money at this stageGrowth stage 1. costs reduced due to economies of scale 2. sales volume increases significantly 3. profitability begins to rise 4. public awareness increases 5. competition begins to increase with a few new players in establishing market 6. increased competition leads to price decreasesMaturity stage 1. costs are lowered as a result of production volumes increasing and experience curve effects 2. sales volume peaks and market saturation is reached 3. increase in competitors entering the market 4. prices tend to drop due to the proliferation of competing products 5. brand differentiation and feature diversification is emphasized to maintain or increase market share 6. Industrial profits go downSaturation and decline stage 1. costs become counter-optimal 2. sales volume decline 3. prices, profitability diminish 4. profit becomes more a challenge of production/distribution efficiency than increased sales 18
  19. 19. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comNew Product Planning16:In business and engineering, new product development (NPD) is the term used to describethe complete process of bringing a new product to market. A product is a set of benefitsoffered for exchange and can be tangible (that is, something physical you can touch) orintangible (like a service, experience, or belief). There are two parallel paths involved in theNPD process: one involves the idea generation, product design and detail engineering; theother involves market research and marketing analysis. Companies typically see newproduct development as the first stage in generating and commercializing new productswithin the overall strategic process of product life cycle management used to maintain orgrow their market share. New product development process1716 source: source: 19
  20. 20. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comRisks Involved18:Opportunity Risks Organizations constantly look for opportunities to reward stakeholders,increase customer satisfaction, and gain advantage over competitors. Making the most ofopportunities is the positive side of risk management. By managing opportunity risksuccessfully, an organization can increase the likelihood that new products will achieveexpected results.Investment Risk The primary issues related to investment risk are the assumptions usedand the source of fundamental data. Assumptions may have no basis in fact or science andcould represent different attitudes or expectations about the same situation. For example, aproduct might have features that designers expect will appeal to new customers, whereasmarketing specialists for the same product may create advertising directed at existingcustomers.Project Management Risk Product development projects need to be successful to satisfycustomers changing needs, gain market position, and take advantage of opportunities. Likeall projects, product development is subject to three main resource constraints: time,funds, and required quality and features. Project managers must achieve balance amongthese resource constraints. Product development projects should include a risk assessmentmodule that allows managers to identify and measure the risks associated with resourceconstraints and then develop appropriate responses.Screening Considerations19:Some of the screening considerations for ideas in new product development can be: • Alignment with your Product Innovation Strategy • Degree of compatibility with the company’s values & principles (ex: moral, health, environmental) • Market attractiveness / opportunity • Project feasibility • Degree of product advantage over other options • Ability to leverage existing company resourcesProduct Testing & Test Markets:Product testing is exposing consumers to a new product, in final or prototype form, so thatthey might compare it to their usual brand and rate it; the results of product testing willindicate to the company whether further evaluation of the product in test markets isdesirable.2018 source: source: source: 20
  21. 21. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comThe test market ideally aims to duplicate everything - promotion and distribution as wellas product - on a smaller scale. The technique replicates, typically in one area, what isplanned to occur in a national launch; and the results are very carefully monitored, so thatthey can be extrapolated to projected national results. The `area may be any one of thefollowing: • Television area • Internet online test • Test town • Residential neighborhood • Test siteA number of decisions have to be taken about any test market: • Which test market? • What is to be tested? • How long a test? • What are the success criteria?The simple go or no-go decision, together with the related reduction of risk, is normally themain justification for the expense of test markets. At the same time, however, such testmarkets can be used to test specific elements of a new products marketing mix; possiblythe version of the product itself, the promotional message and media spend, thedistribution channels and the price. In this case, several `matched test markets (usuallysmall ones) may be used, each testing different marketing mixes.Clearly, all test markets provide additional information in advance of a launch and mayensure that launch is successful: it is reported that, even at such a late stage, half theproducts entering test markets do not justify a subsequent national launch. However, alltest markets do suffer from a number of disadvantages: 1. Replicability - Even the largest test market is not totally representative of the national market, and the smaller ones may introduce gross distortions. Test market results therefore have to be treated with reservations, in exactly the same way as other market research. 2. Effectiveness - In many cases the major part of the investment has already been made (in development and in plant, for example) before the `product is ready to be test marketed. Therefore, the reduction in risk may be minimal; and not worth the delays involved. Competitor warning. All test markets give competitors advance warning of your intentions, and the time to react. They may even be able to go national with their own product before your own test is complete. They may also interfere with your test, by changing their promotional activities (usually by massively increasing them) to the extent that your results are meaningless. 3. Cost- Although the main objective of test markets is to reduce the amount of investment put at risk, they may still involve significant costs. 21
  22. 22. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comProducts & Packaging Factors to be Considered in Packaging Design21: Kotler 13e pg. 331Here is a quick overview listing of factors that should be considered when designing aproducts packaging: 1. Protection – Packaging is primarily used to protect the product from damage during shipping and handling, and to lessen spoilage if the protect is exposed to air or other elements. 2. Visibility – Packaging design is used to capture customers’ attention as they are shopping or glancing through a catalog or website. This is particularly important for customers who are not familiar with the product and in situations, such as those found in grocery stores, where a product must stand out among thousands of other products. Packaging designs that standout are more likely to be remembered on future shopping trips. 3. Added Value – Packaging design and structure can add value to a product. For instance, benefits can be obtained from package structures that make the product easier to use while stylistic designs can make the product more attractive to display in the customer’s home. 4. Distributor Acceptance – Packaging decisions must not only be accepted by the final customer, they may also have to be accepted by distributors who sell the product for the supplier. For instance, a retailer may not accept packages unless they conform to requirements they have for storing products on their shelves. 5. Cost – Packaging can represent a significant portion of a product’s selling price. For example, it is estimated that in the cosmetics industry the packaging cost of some products may be as high as 40% of a product’s selling price. Smart packaging decisions can help reduce costs and possibly lead to higher profits. 6. Expensive to Create - Developing new packaging can be extremely expensive. The costs involved in creating new packaging include: graphic and structural design, production, customer testing, possible destruction of leftover old packaging, and possible advertising to inform customer of the new packaging. 7. Long Term Decision – When companies create a new package it is most often with the intention of having the design on the market for an extended period of time. In fact, changing a product’s packaging too frequently can have negative effects since customers become conditioned to locate the product based on its package and may be confused if the design is altered. 8. Environmental or Legal Issues – Packaging decisions must also include an assessment of its environmental impact especially for products with packages that are frequently discarded. Packages that are not easily bio-degradable could draw customer and possibly governmental concern. Also, caution must be exercised in order to create packages that do not infringe on intellectual property, such as copyrights, trademarks or patents, held by others.21 source: 22
  23. 23. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com4. Basic Pricing Strategies & Practices Kotler 13e pg. 375, 389Before reading this module, spare 10 mins and go through my ppt at: In ordinary usage, price is the quantity of payment or compensation given by oneparty to another in return for goods or services.Objectives of pricing: Profit, revenue, quantity, differentiation, survivalFactors affecting pricing: marketing mix elements, demand, cost of goods, competitionMajor approaches to pricing: Price Vs. Non-price competition Market entry strategies: Skimming Penetration Discounts and allowances Quantity discounts Trade discounts Cash discounts Rebates Geographic pricing strategies Point of production pricing Uniform delivered pricing Zone delivered pricing Freight absorption pricing Special pricing strategies One price and flexible price strategies Price lining Odd pricing Leader pricing Everyday low pricing (EDLP) Resale price maintenancePlease read the book and my ppt to understand all the above strategies. You can also visit to read more on differentpricing strategies. 23
  24. 24. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com5. Advertising & PromotionBefore reading this module, spare 15 mins and go through my ppts at: is a form of communication used to persuade an audience (viewers, readers orlisteners) to take some action with respect to products, ideas, or services. Most commonly,the desired result is to drive consumer behavior with respect to a commercial offering,although political and ideological advertising is also common. Advertising messages areusually paid for by sponsors and viewed via various traditional media; including massmedia such as newspaper, magazines, television commercial, radio advertisement, outdooradvertising or direct mail; or new media such as websites and text messages.Role of Consumer Research in Advertising Decisions:Consumer Research leads to ‘Consumer insight’23 which is a flash of understanding on thepart of a marketer regarding an unidentified or unmet need in the marketplace, or anew/better way to satisfy an existing need. Discovering this consumer insight is the HolyGrail for marketers who want to break the clutter and get noticed.It is NOT about a product or service. Its about a consumer need that isnt being met aswell as it could be. The marketers challenge, having recognized the insight, is to find a wayto capitalize on the thinking that identified the need. That could lead to an advertisement,development of product or service etc.A good article on the role of research in advertising can be found at: of Advertising24:Local Planning Authorities are primarily responsible for the control of advertisements. Theyare required to consider applications for permission to display adverts and to exerciseenforcement powers over existing and unlawful advertisements.Advertising Standards Council of India is a self regulatory voluntary organization of theadvertising industry.The Advertising Standards Council of India (ASCI), established in 1985, is committed to thecause of Self-Regulation in Advertising, ensuring the protection of the interests ofconsumers. The ASCI was formed with the support of all four sectors connected withAdvertising, viz. Advertisers, Ad Agencies, Media (including Broadcasters and the Press)22 source: source : source: 24
  25. 25. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comand others like PR Agencies, Market Research Companies etc. Its main objective is topromote responsible advertising thus enhancing the publics confidence in Advertising.ASCI is represented in all committees working on advertising content in every Ministry ofthe Government of India. ASCI’s Code for Self-Regulation in Advertising is now part of adcode under Cable TV Act’s Rules. Violation of ASCI’s Code is now violation of Govt. rules.ASCI’s membership of The European Advertising Standards Alliance (EASA) ensures that itgets valuable advice, learning and even influence at the international level.The Consumer Complaints Council is ASCIs heart and soul. It is the dedicated work put inby this group of highly respected people that has given tremendous impetus to the work ofASCI and the movement of self-regulation in the advertising. This group comprise of 21drawn from various disciplines. 12 are eminent people not associated with advertising (such as lawyer, doctor, journalist, teachers, technical experts consumer activities etc.) and9 are from industry (advertiser, media, ad agencies and allied professionals.ASCI thus aims to achieve its own overarching goal: to maintain and enhance the publicsconfidence in advertising.Advertising Agencies25:An advertising agency or ad agency is a service business dedicated to creating, planningand handling advertising (and sometimes other forms of promotion) for its clients. An adagency is independent from the client and provides an outside point of view to the effort ofselling the clients products or services. An agency can also handle overall marketing andbranding strategies and sales promotions for its clients. Types of advertising agencies:Generalized advertising agenciesCreative agencies specialize in "creative" or design-based business models: their basicinterest is in the creation of the advertisement or branding. Other ("full-service") agenciesoffer design in conjunction with media buying. Media agencies concentrate on mediabuying. (In the 1990s, media and creative were often unbundled in the interests ofeconomies of scale in buying media.[4])Specialist advertising agenciesIn addition to the full-service, general-line advertising agencies, there are also agenciesthat specialize in particular kinds of advertising: recruitment, help-wanted, medical,classified, industrial, financial, direct-response, retail, yellow pages,theatrical/entertainment, investment, travel, and so on.In-House advertising agenciesSome advertisers believe that they can provide such advertising services to themselves ata lower cost than would be charged by an outside agency.25 source: 25
  26. 26. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comInteractive agenciesInteractive agencies may differentiate themselves by offering a mix of webdesign/development, search engine marketing, internet advertising/marketing, or e-business/e-commerce consulting. Interactive agencies rose to prominence before thetraditional advertising agencies fully embraced the Internet. Offering a wide range ofservices, some of the interactive agencies grew very rapidly, although some havedownsized just as rapidly due to changing market conditions. Today, the most successfulinteractive agencies are defined as companies that provide specialized advertising andmarketing services for the digital space.Agency departments:Creative departmentThe people who create the actual ads form the core of an advertising agency. Modernadvertising agencies usually form their copywriters and art directors into creative teams.Creative teams may be permanent partnerships or formed on a project-by-project basis.The art director and copywriter report to a creative director, usually a creative employeewith several years of experience. Although copywriters have the word "write" in their jobtitle, and art directors have the word "art", one does not necessarily write the words andthe other draw the pictures; they both generate creative ideas to represent the proposition(the advertisement or campaigns key message). Once they receive the creative brief fromtheir account team, the creative team will concept ideas to take to their creative directorfor feedback. This can often be a back and forth process, occurring several times beforeseveral ads are set to present to the client. Creative departments frequently work withoutside design or production studios to develop and implement their ideas. Creativedepartments may employ production artists as entry-level positions, as well as foroperations and maintenance. The creative process forms the most crucial part of theadvertising process.Media servicesThe media services department may not be so well known, but its employees are thepeople who have contacts with the suppliers of various creative media. For example, theywill be able to advise upon and negotiate with printers if an agency is producing flyers for aclient. However, when dealing with the major media (broadcast media, outdoor, and thepress), this work is usually outsourced to a media agency which can advise on mediaplanning and is normally large enough to negotiate prices down further than a singleagency or client can. They can often be restrained by the clients budget, in which, themedia strategy will inform the creative team what media platform theyll be developing thead for.Modern agencies might also have a media planning department integrated, which does allthe spots planning and placementsProductionWithout the production department, the ads created by the copywriter and art directorwould be nothing more than words and pictures on paper. The production department, in 26
  27. 27. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comessence, ensures the TV commercial or print ad, etc., gets produced. They are responsiblefor contracting external vendors (directors and production companies in the case of TVcommercials; photographers and design studios in the case of the print advertising or directmailers). Producers are involved in every aspect of a project, from the initial creativebriefing through execution and delivery. In some agencies, senior producers are known as"executive producers" or "content architects".Other departments and personnelIn small agencies, employees may do both creative and account service work. Largeragencies attract people who specialize in one or the other, and indeed include a number ofpeople in specialized positions: production work, Internet advertising, planning, orresearch, for example.Media Decisions – Budgets26: Kotler 13e pg. 487Method (1) Fixed percentage of salesIn markets with a stable, predictable sales pattern, some companies set their advertisingspend consistently at a fixed percentage of sales. This policy has the advantage of avoidingan “advertising war” which could be bad news for profits.However, there are some disadvantages with this approach. This approach assumes thatsales are directly related to advertising. Clearly this will not entirely be the case, sinceother elements of the promotional mix will also affect sales. If the rule is applied whensales are declining, the result will be a reduction in advertising just when greater salespromotion is required!Method (2) Same level as competitorsThis approach has widespread use when products are well-established with predictablesales patterns. It is based on the assumption that there is an “industry average” spend thatworks well for all major players in a market.A major problem with this approach (in addition to the disadvantages set out for theexample above) is that it encourages businesses to ignore the effectiveness of theiradvertising spend – it makes them “lazy”. It could also prevent a business with competitiveadvantages from increasing market share by spending more than average.Method (3) TaskThe task approach involves setting marketing objectives based on the “tasks” that theadvertising has to complete.These tasks could be financial in nature (e.g. achieve a certain increase in sales, profits) orrelated to the marketing activity that is generated by the campaigns. For example:• Numbers of enquiries received quoting the source code on the advertisement• Increase in customer recognition / awareness of the product or brand (which can bemeasured)• Number of viewers, listeners or readers reached by the campaign26 source: 27
  28. 28. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comMethod (4) ResidualThe residual approach, which is perhaps the worst of all, is to base the advertising budgeton what the business can afford – after all other expenditure. There is no attempt toassociate marketing objectives with levels of advertising. In a good year large amounts ofmoney could be wasted; in a bad year, the low advertising budget could guarantee afurther low year for sales.Branding: Kotler 13e pg. 250It is the process of creating brands. A brand can be defined as a "Name, term, design, symbol,or any other feature that identifies one sellers good or service as distinct from those of other sellers." [1]Refer to the following ppt to know more about branding: of Effectiveness27:How can the effectiveness of an advert be judged?The answer depends on what objectives or tasks were set for the advert.The table below sets out some possible objectives/tasks and how the effectiveness of theadvert might be measured:Advertising objective How success can be measured - Number of enquiries from advertStimulate an increase in sales - Number of enquiries converted into sales - Test customer awareness both before and after theRemind customers of the existence of a advertising campaignproduct - Number of enquiries - Test customer awarenessInform customers - Number of requests for further information -SalesBuild a brand image -Test customer awareness of brand recognition and perceived values - Levels of repeat purchaseBuild customer loyalty and relationship - Levels of customer retention - Measure demographic profile of purchasesChange customer attitudes - Measure type of goods ordered by new purchasers - Compare with previous data27 source: 28
  29. 29. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.com6. Organizations for MarketingBefore reading this module, spare 10 mins and go through my ppts at: major bases of performance evaluation28:Marketing performance measurement and management (MPM) is a term used by marketingprofessionals to describe the analysis and improvement of the efficiency and effectivenessof marketing. This is accomplished by focus on the alignment of marketing activities,strategies, and metrics with business goals. It involves the creation of a metrics frameworkto monitor marketing performance, and then develop and utilize marketing dashboards tomanage marketing performance. This strategy is used by several companies such as IBM,Intel, and Citrix.Performance management is one of the key processes applied to business operations suchas manufacturing, logistics, and product development. The goals of performancemanagement are to achieve key outcomes and objectives to optimize individual, group, ororganizational performance. MPM however, is more specific. It focuses on measuring,managing, and analyzing marketing performance to maximize effectiveness and optimizethe return of investment (ROI) of marketing.Basic channels of distributions: Kotler 13e pg. 407Distribution channel consists of an organization or set of organizations (go-between)involved in the process of making a product or service available for use or consumption bya consumer or business user.28 source: 29
  30. 30. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comRetailing / Retail Marketing: Kotler 13e pg. 432Retailing is the last step in the supply chain. Retail marketing is comprised of the activitiesrelated to selling products directly to consumers through channels such as stores, malls,kiosks, vending machines or other fixed locations, according to the Free Dictionary.Retailers buy products in bulk and sell them in small quantities to individual customers.Wholesaling29:Wholesaling usually, but not necessarily, involves sales in large quantity and at a cost thatis significantly lower than the average retail price.Wholesaling became particularly advantageous after the introduction of mass productionand mass marketing techniques in the 19th century. Without wholesale organizations, largemanufacturers would have to market their products directly to a great many retailersand/or consumers at high unit costs, and retailers or consumers would have to deal with alarge number of manufacturers at great inconvenience.Sales Management Tasks: Kotler 13e pg. 537Sales management is a business discipline which is focused on the practical application ofsales techniques and the management of a firms sales operations. It is an importantbusiness function as net sales through the sale of products and servicess and resultingprofit drive most commercial business. These are also typically the goals and performanceindicators of sales management.29 source: 30
  31. 31. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comThe tasks typically involves sales planning, human resources, talent development,leadership and control of resources such as organisational assets. They can be listed asbelow:Sales Functions30-Sales-Customers Sales-Market review-Sales Policies-Products Performance-Distribution-Customer ACCOUNTS review-Reseller MANAGEMENT-Sales Organization-Territories Sales-Sales Force MANAGEMENT-Sales Promotions-Sales support review-Sales training-Competition-Pricing-Sales problem solving-setting sales objectives-field visits-managing sales controlClassification of Industrial Products:Like the consumer product, the industrial products also offer a vast variety in nature andkind. The following classification would amply prove this fact:1. Goods entering the product completely- Material and Party.a) Raw materials:-i. Farm Products, e.g., Cotton, Jute, Sugarcane.ii. Natural products, e.g., Timber, petroleum, Minerals.b) Manufactured Materials, and Parts:i. Component materials, e.g., Steel, Cement, Chemicals.ii. Component parts, e.g., Electric motors, Lathes.2. Goods entering the product party- Capital Items.a) Installations:i. Building, Land.ii. Fixed Equipments-Machineries.30 source: 31
  32. 32. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comb) Accessory Equipments, e.g., Type-writers, Loose tools.3. Goods not entering the product-Supplies and Service.a) Supplies:1. Operating Supplies e.g., Lubricants, Coal.2. Maintenance and Repair Items.b) Business Services:i. Maintenance and Repair Services.ii. Business Advisory Services : e.g., Legal, Management Consultancy, etc.The general characteristic features of industrial products have been given earlier. Thecharacteristic features may change according to the nature of the particular product.Marketing Control SystemsIt is a system comprising of different procedures and various levels of managementto bring efficiency and to keep a check on different marketing functions within theorganization. There are primarily four types of marketing control systems. Theseare,Annual Plan Control, Profitability Control, Efficiency Control and Strategic ControlAnnual plan control – These are top and middle management tasks that try to examinewhether the planned results are being achieved.Profitability Control– This is done to examine whether the company is making or losing money while carryingout its business. Profitability is measured in terms of product category, territory, segment,channels, order size etcEfficiency Control– Used to evaluate and improve the spending efficiency and impactof marketingexpenditures. Efficiency of sales force, advertising, sales promotion anddistribution ismeasured.Strategic Control– This is used to examine whether the Company is pursuing its bestopportunities withrespect to markets, products and channels. To do a proper assessmentfor strategic controldifferent instruments including marketing audit, marketingeffectiveness, marketingexcellence review and the ethical and social responsibilityreview.Marketing AuditThe marketing audit is a fundamental part of the marketing planning process. It isconducted not only at the beginning of the process, but also at a series of points during theimplementation of the plan. The marketing audit considers both internal and externalinfluences on marketing planning, as well as a review of the plan itself. 32
  33. 33. Notes for marketing students of SSESGI (for private circulation only) © www.profmanishparihar.blogspot.comThere are a number of tools and audits that can be used, for example SWOT analysis forthe internal environment, as well as the external environment. Other examples includePEST and Five Forces Analyses, which focus solely on the external environment.Lets consider the marketing audit under three key headings: • The Internal Marketing Environment. • The External Marketing Environment. • A Review of Our Current Marketing Plan.Brief Idea of International Marketing31: Kotler 13e pg. 584International marketing is simply the application of marketing principles to more than onecountry. However, there is a crossover between what is commonly expressed asinternational marketing and global marketing, which is a similar term. For the purposes ofthis lesson on international marketing and those that follow it, international marketing andglobal marketing are interchangeable.After the decision to expand beyond the country of origin has been made, the exact modeof operation has to be determined. The risks concerning operating in foreign markets isoften dependent on the level of control a firm has, coupled with the level of capitalexpenditure outlayed. The principal modes of engagement are listed below: • Exporting (which is further divided into direct and indirect exporting) • Joint ventures • Direct investment (split into assembly and manufacturing) ***Disclaimers: • These notes have been compiled from various sources and as far as possible, all the sources have been acknowledged. • These notes are only for supplementary/additional reading and should NOT be used as a replacement to the recommended text books and reference books. • The material is intended for private circulation for the students of Saraswati Institute of Engineering and Management, Rajpur, Mehsana ( by: Prof. Manish Parihar, SIEM (Nov 2011) www.profmanishparihar.blogspot.com31 source: 33