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AN INTRODUCTION TO DIFFERENTIATED LEARNING TOOLS
Participants in flexible learning programs have limitations on the nature of the
time they can spend on learning. Typically they are employed fully or partially,
pursuing higher studies or have other social and familial responsibilities.
Availability of time is a great constraint to these students.
To aidthe participants,we have developedfour unique learningtools as below:
Bullet Notes : Helps in introducing the important concepts in each unit
of curriculum, equip the
student during preparation of
examinations and
Case Studies : Illustrate the concepts through real life experiences

Workbook : Helps absorption of learning through questions based on reallife nuggets
PEP Notes :Sharing notes of practices and experiences in the Industry will help the student to
rightly perceive and get inspired to learn concepts at the cutting edge
application level.placementinterviews
Why are these needed?
 Adults learn differently from B. School or college going
students who spend long hours at campus.
 Enhancing analytical skills through application related learning
kits trigger experiential learning
 Availability of time is a challenge.
 Career success increasingly depends on continuous learning
and success
What makes it relevant?

How is it useful?


Where does this lead to?
As and when you get 5 to 10 minutes you can read one of these and absorb and comprehend.
Spending more time is your choice.
You can use the time in travel, waiting for meetings, lunch time, small breaks or at home
usefully.
Through these tools, the learning bytes are right sized for ease of learning for time challenged
participants.
The content starts from practice and connect to precept making it easy to connect to industry
and retain.
They can be connectedto continuous assessment process of the academic program.
Practitioners can use their real life knowledge and skill to enhance learning skills.
Immediate visualization of the practical dimension of the concept will offer a rich learning
experience.

Easier to move ahead in the learning process.

Will facilitate the student to complete the program earlier than
otherwise.Helpsstay motivated and connected.
When is it useful?


© The ICFAI Foundation for Higher Education (IFHE),
Hyderabad, May, 2015.All rights reserved
No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or
transmitted in any form or by any means – electronic, mechanical, photocopying or otherwise – without
prior permission in writing from The ICFAI Foundation for Higher Education (IFHE), Hyderabad.
Ref. No. MM-WB-IFHE – 052015
For any clarification regarding this book, the students may please write to The ICFAI Foundation for Higher
Education (IFHE), Hyderabad giving the above reference number of this book specifying chapter and page
number.
While every possible care has been taken in type-setting and printing this book, The ICFAI Foundation for
Higher Education (IFHE), Hyderabad welcomes suggestions from students for improvement in future
editions.
Our E-mail ID: cwfeedback@icfaiuniversity.in
ii

INTRODUCTION
Participants in ICFAI University Programs are eager to learn more from practice. They realize that
application orientation can enhance their learning and subsequent usage of management precepts and
practices. Picking out the principle behind real world events is critical to this learning, as also identifying the
alternative/solution using the principle. Towards this end the institution has reengineered the Workbook.
The Workbook is a set of questions which typically illustrate a real life context from contemporary
corporate happenings and then poses a question to the student for reflection. The narration of question helps
the reader to reinforce the concept and facilitates the student to enhance his/her capabilities in analyzing and
interpreting the conceptual frameworks.
The examples depicting the names of existing persons or companies are taken from news clippings/
published articles from various public domain websites or website of respective companies. Since live
examples reinforce the understanding of the students, the possible responses are connected to the concepts
taught directly or indirectly. In many cases the alternatives provided are choices in a work situation based on
alternative approaches.
These questions provoke the learner to start thinking fromthe application side and connect to the knowledge
that he will use to solve. Practitioners can connect better thereby improving the learning experience. This
form of assessment improves learning while assessing whereas the conventional form is more about
assessment of learning.
The learning outcomes expected are:
The examples are linked back to application of theoretical knowledge in the illustrated real-time
situation. This facilitates the student to develop analytical approach in similar or related situations.
Application based approach which enhances absorption and retention significantly.
Exposure to the current incidences and situations in relation to important concepts ofthe
subject.The Workbook format is also used for Assessment.
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DETAILED CURRICULUM
UNIT 1: MARKETING: THE DEVELOPMENT OF A CONCEPT
Definition of Marketing - Evolution of Marketing: Marketing Concept – Customer orientation, Long term
profitability, Functional integration; Societal Marketing Concept (SMC) –Holistic marketing, Marketing 3.0,
Marketing Dynamics: Company Responses and Adjustments, Marketer Response and Adjustments –
Customization, Building a good relationship with customers, Target marketing, Customer database,
integrated marketing communication - Significance of Marketing : The Airline Industry – Marketing of
Airlines, Marketing Strategies; The Banking Industry – Defi nition of Bank Marketing, Banks and
Marketing; The Education Industry – Marketing of Education, Marketing strategy.
UNIT 2: DELIVERING CUSTOMER VALUES AND SATISFACTION
Business Components: Stakeholders, Processes,Resources,Organization - Customer Satisfaction- Concept
of Value: Value Chain, Providing Value-cost Balance, Value Delivery System - Attracting and Retaining
Customers: Attracting Customers, Cost of Losing a Customer, Need for Retention – Increased revenue,
Decrease in cost of selling, Advertising, Cross selling possibilities, structural ties - Customer Profitability –
Customer equity, Relationship Marketing, Internal marketing.
UNIT 3: MARKETING ENVIRONMENT
Competitive Forces: Monopoly, Oligopoly, Monopolistic competition, Pure competition – Monitoring
competition –Intellectual property rights, Laws affectin g marketing/promotional decisions, Macro
Economic Factors: Demographic Environment, Consumer Groups - Age-wise Classification: Infants,
Children (school going-teens), Young Adults (19-30 years), Adults, Senior Citizens; Other demographic
variables – Women, Singles, Occupation and Literacy, Location, Cultural diversity; Political Environment –
Domestic Politics, International Politics Economic Environment – General Eco nomy, Business Cycle,
Buying Power, Willingness to Spend, Socio Cultural Forces, Technology, Impact of Technology Natural
Environment; Legal Environment – Consumer protection Act, State Regul atory Agencies, Non-government
Regulatory Agencies - Indian Business Environment and MNCs in India.
UNIT 4: MARKETING BUDGETS AND COSTS
Marketing Cost Analysis: Importance of Marketing Cost Analysis, Steps in Marketing Cost Analysis, Full
Cost versus Contribution Margin Approach - Customer Profitability Analysis: Steps in Customer
Profitability Analysis, Financial Situation Analysis, Contribution Analysis - Budgeting for the Sales Force
Department - Production and Efficiency: Learning Effect and Experience Curve, Economies of Scale.
UNIT 5: UNDERSTANDING CONSUMER BUYING BEHAVIOR
Factors Influencing Consumer Buying Behavior: Cultural Factors – Culture, Subculture, Social Class-Upper
Class, Upper middle class,Middle class, Lower class - Social Factors: Reference Groups, Family - Indian
consumer, Indian rural vs. urban consumer, Personal Factors - Age and Lifecycle Changes,Occupation and
Financial Status,Life Style; Psychological Factors –M otivation, Perceptions, Beliefs and Attitudes - Buying
Decisions: Buying Roles, Buying behavior – Extensive problem solving behavior, routinized buying
behavior, Variety seeking behavior - Buying Decision Process - Problem Recognition - Information Search -
Evaluation of Alternatives - Purchase Decision - Post Purchase Behavior, Cognitive Dissonance.
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UNIT 6: ORGANIZATIONAL MARKETS AND ORGANIZATIONAL BUYING BEHAVIOR
Concept of Organizational Buying – Difference between orga nizational markets and consumer markets,
Types of organizational buying situations and situational factors - New task, Modified re-buy, Straight re-
buy, organizational markets in India – Chemical and Pharm aceutical Sector, Energy and natural resources,
Industrial and automotive sector - Dimensions of Organizational Buying - Classification of Organizational
Markets: Producers’ markets, Resellers markets, Government markets, Institutional markets - Factors
Influencing Organizational Buying, Environmental Factors, Organizational Factors, Social Factors, Personal
Factors - Participants in Organizational Buying: Initiators, Influencers, Users, Deciders, Approvers,
Gatekeepers- Procurement Process: Buying, Supply Management Orientation - Stages of Buying: Problem
Recognition, General Need Recognition, Product Specification, Searching for Potential Suppliers, Value
Analysis, Vendor Analysis, Order Routine Specification, Multiple Sourcing, Performance Review.
UNIT 7: MARKETING RESEARCH, MKIS, AND DEMAND FORECASTING
Meaning and Scope of Marketing Research - The Marketing Research Process: Formulating the Problem,
Developing Objectives of the Research, Designing an Effective Research Plan: Research Instruments –
Questionnaire, Mechanical Instruments, Sampling, Date Collection Techniques: Primary date collection –
Mail interviews, Telephonic interviews, Personal interview, Observation, Secondary date collection,
Evaluating the Data and Preparing a Research Report - Meaning and Scope of Marketing Information
System (MkIS): MkIS Components –Internal record System: Order to payment scale, Sales reporting
system; Marketing intelligence system, Marketing decision support system - Demand Forecast and
Measurement: Market Classification: Potential market, Available market, qualified available market, Target
market - The Concept of Market Demand for Marketing: Company Demand, Company Sales Forecast, Sales
Quota and Sales Budget, Current Demand Estimation - Future Demand Estimation: Composite sales force
opinion, Survey of buyer intentions, Expert opinion, Past sales analysis, Exponential smoothing, Statistical
demand analysis, Econometric analysis, Test marketing method.
UNIT 8: MARKET SEGMENTATION AND MARKET TARGETING
Need for Segmenting Markets - Market Segmentation Levels: Segment Marketing, Individual Marketing,
Niche Marketing, Local Marketing - The Selection of Segmentation Variables: Criteria for segmenting
consumer, Geographic segmentation, Demographic segmentation, Age and life cycle stage, Gender, Income,
Generation, Social class, Psychographic segmentation, Lifestyle, Personality, Values, Behavioral
segmentation, Occasions, Benefits, Usage rate, Loyalty status, Buyer-readiness stage, Attitude, Multi-
attribute segmentation, Criteria for segmenting organizational markets, Demographics, Industry, Company
size, Customer location, Operating variables, Company technology, Produce and brand use status, Customer
capabilities, Purchasing approaches, Situational factors, Urgency of order fulfilment, Product application ,
Size of the order, Personal characteristics of the purchasers - Effective Segmentation: Characteristics in
segmentation- Measurable, Substantial, Accessible, Differentiable, Actionable - Target Market Selection
Process: Evaluating the market segments, Selecting the market segments, Single segment concentration,
Selective specialization, Product specialization, Market specialization, Full market coverage, Other
considerations – Ethical choice of market targets, Segm ent interrelationships and super segments, Segment-
by-segment invasion plans, Inter-segment cooperation.
UNIT 9: STRATEGIC PLANNING PROCESS IN MARKETING
Defining Strategic Market Planning - Corporate and Divisional Strategic Planning: Corporate Mission,
Establishment of SBUs, Resource Allocation: BCG competitive advantage matrix, General electric model,
Planning new Businesses and Downsizing Existing businesses: Intensive growth, Integrative growth,
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Diversification growth, Downsizing older businesses - Strategic Business Planning: Steps in Preparing
Strategic Business Plan; Stages in Business plan – Busines s Mission, SWOT Analysis, Strategies, Strategic
alliances, Implementation, Feedback and control - Marketing Process: Value delivery sequence – Focus on
product, Focus on customer - Steps in the Planning Process – Analyzing marketing opportunities, developing
marketing strategies, planning marketing programs, Managing the marketing effort - Marketing Plan:
functions – Content, Executive summary, Opportunity and issue analysis, Marketing strategy, Action
programs, Projected profit and loss statement, Control.
UNIT 10: MARKETING AND COMPETITIVE STRATEGIES
The Concept of Competitive Advantage - Porter’s Five Forces Model: Barriers to Entry/Threat of New
Entrants, Intensity of Rivalry among Firms, Threat of Substitutes, Bargaining Power of Buyers, Bargaining
Power of Suppliers - Analysis of Competitors: Classes of Competitors – Generic competition, Firm
competition, Industry competition, Brand competition, Identifying Competition; Analyzing Competition,
Strategies, Objectives, Strengths and Weaknesses, Reaction Patterns - Porter’s Generic Competitive
Strategies: Cost Leadership Strategy, Differentiation Strategy, Focus Strategy, Generic Strategy Mix -
Designing Competitive Strategies: Market Leader Strategies, Market Challenger Strategies, Market Follower
Strategies, Market Niche Strategies, marketing strategies during economic downturn, Competitive
Intelligence System: Setting Up the System, Data Collection, Analysis and Evaluation of Data, Information
Communication and Response - Total Quality Management (TQM).
UNIT 11: PRODUCT AND PRODUCT PORTFOLIO
Product Personality: Core features, Associated features; Nature of the Product – Generic product, Expected
product,Augmented product,Potential product; Product Hierarchy - Product Classification: Durability and
Tangibility – Durables, Non-durables, Services, Usage: Co nsumer products,Shopping products,Specialty
products,Unsought products,IndustrialProducts: Raw material, Component parts, Process material, Support
products, Capital equipment: Accessory equipment, Consumable supplies, Business services - Product
Policy: Product mix, Product Mix Strategies – Expansion of product mix, contraction of product mix,
Altering existing products, positioning the product, Trading up, Trading down Managing product lines:
Product line analysis, Product line length, Line stretching, Line filling, Product line modernization, Product
line pruning, Reasons for line extension, Limitations of line extension - Product Life Cycle: Introduction,
Strategies for introduction stage – Rapid skimming, Slow ski mming, Rapid penetration, Slow penetrations;
Growth, Maturity, Decline.
UNIT 12: PRODUCT DIFFERENTIATIONS AND POSITIONING
Product Differentiation: Product Form, Design, Features, Product Quality, Durability, Size of Package -
Service Differentiation: Ordering Ease, Delivery, Installation, Guarantees, Financial Arrangement, Customer
Training, Maintenance and Repair, Disposal - Personnel Differentiation - Channel Differentiation - Image
Differentiation: Company’s Management, Symbols, Logos, Atmosphere, Events - Positioning: Getting into
the Mind of the Consumer, Positioning of a Leader, Positioning of a Follower, The Power of a Name,
Pitfalls in Positioning.
UNIT 13: NEW PRODUCT DEVELOPMENT
Challenges in New Product Development - Organizing the Product Development Process: Product
Managers, Product Committees, Product Departments, Product Venture Teams - Stages of New Product
Development: Idea Generation, Idea Screening, Concept Testing and Analysis - Business analysis, Total
sales estimation, Estimating costs and profits, Product Development, Test Marketing, Commercialization.
vi

UNIT 14: BRANDING AND PACKAGING
Brand as a Concept and its Significance: Value and Significance of a Brand - Types of Brands and their
challenges: Manufacturers’ brand, Private brands, Generic brands, Brand challenges - Brand Equity:
Selection of a Brand Name, Brand equity models, Measuring brand equity - Brand Sponsorship - Brand
Strategy Decision: Line Extension, Brand Extension, Brand Rejuvenation, Brand Relaunch, Brand
Proliferation, Multi-brands, New Brand Name, Co Brands - New Developments in Brand Management -
Packaging and its Importance in Marketing: Importance of Packaging in Marketing, Packaging and
Marketing Strategies, Innovations in packaging, -Labeling: Universal Product Codes.
UNIT 15: PRICING AND MARKETING
Significance and Importance of Price to a Marketer - Price and Non Price Competition - The Process of
Product/Service Pricing: Setting pricing objectives- Survival, Profit, Market Share, Status quo, Product
Quality - Analyzing competitor’s pricing - The selection of a pricing method – Mark-up pricing, Target
return pricing, Perceived value pricing, Going rate pricing, Sealed bid pricing, Differentiated pricing, Value
pricing, Market Skimming, Dynamic pricing, - The Selection of pricing policy: Psychological pricing,
Transfer pricing - Approaches to Price Adjustment: Geographical pricing, Promotional pricing,
Discriminatory pricing, Discounts and allowances-Seasonal discounts, Cash discounts, Quantity discounts,
Trade discounts, Experience curve pricing, Product mix pricing – Product line pricing, Optional feature
pricing, Captive product pricing, Two-part pricing, By-product pricing, Product Bundling Pricing, Pricing
techniques of Online retailers - Effects of Price Changes: Buyers’ perceptions on the price changes,
Competitors’ reactions.
UNIT 16: CHANNELS OF MARKETING
Nature of Marketing Channels -Role of Marketing Channels: Channel flow, Channel levels, Service Sector
Channels - Functions of Marketing Channels: Facilitating the Exchange Process, Alleviating Discrepancies -
Steps in Regrouping - Sorting , Accumulating, Allocating, Assorting, Standardizing Transactions, Matching
Buyers and Sellers, Providing Customer Service - Designing Distribution Channels: Analyzing Customer
Expectations of Service Output, Lot Size Utility, Convenience Utility, Selection Utility, Service Utility,
Formulating Objectives, Evaluation of Distribution Environment, Evaluating Channel Alternatives,
Economic Criteria, Control Criteria, Adaptive Criteria - Channel Management: Channel Member Selection,
Channel Member’s Training, Member Motivation and Evaluation, Modifying Channel Arrangement, Legal
and Ethical Issues in Channel Management - Channel Dynamics: Horizontal Marketing System, Vertical
Marketing System (VMS), Corporate VMS, Administered VMS, Contractual VMS - Multi-Channel
Marketing System - Channelsand Conflicts: Types of Channel Conflicts, Causes of Channel Conflicts,
Managing Channel Conflicts.
UNIT 17: LOGISTICS AND WHOLESALING
Objectives of Marketing Logistics: Delivering customer service, Reducing total distribution, Reducing cycle
time - Market Logistic Decisions: Order processing, Inventory management- Reorder point, Order lead time,
Safety stock, Economic order quantity, Just-in-time, Fixed order interval system; Transportation - Functions
of Warehousing - Strategic Issues in Managing Logistics - Growth of Wholesaling - Classification of
Wholesalers: Merchant wholesalers, Agents and Brokers, Manufacturers’ sales branches and offices -
Market Decision: Target market, Price, Promotion, Place - Changing Patterns in Wholesaling: Wholesale
consolidation, Productivity and quality, Global expansion.
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UNIT 18: RETAILING
Types of Retailers: Ownership, The number of Product Lines Handled, Specialty Stores, Department Stores,
Discount Stores, Super markets, Retailing Based on the Service vs. Goods Retail Strategy Mix, Non-Store
Based Retailing, Direct Selling, Direct Marketing, Automatic Vending, Implications of Merchandising -
Franchising: Types of Franchising – Product distribution fran chise, Business format franchise, Trade name
franchise, Advantages and disadvantages ofFranchising – Adva ntages to the Franchiser, Disadvantages to a
Franchiser, Advantages to a Franchisee, Disadvantages to a Franchisee - Strategic issues in Retailing:
Location, Store Image Decisions - Market Decisions: Product Assortment and Procurement, Service Mixand
Retailing Environment, Place Promotion, Private label - Global Trends in Retailing - Trends in Retailing in
India.
UNIT 19: COMMUNICATION MIX IN MARKETING
Communication and Promotion Process: The Communication Process – Communication source, Receiver,
Coding process, medium of transmission, Decoding process, Noise, Feedback - Types of Communication
Channels: Personal Channels, Non-personal channels - Promotional Tools: Advertising, Sales promotion,
Publicity, Public relations, Personal selling, Direct marketing, Integrated marketing communication (IMC) -
Developing a Communication Program: Target audience identification, Determination of communication
objectives – Awareness, Knowledge, Liking, Preference, Con viction, Purchase, Stimulate demand;
Developing marketing communication budget – Objective and task m ethod, Competitive parity method,
Affordable method Factors influencing the designing of communication message: Message content –
Rational appeal, Emotional appeal, Moral appeal, Format, Source - Marketing Communication Mix: Product
market type, Pull-Push strategy, The product life cycle, Effectiveness of advertising.
UNIT 20: ADVERTISING, SALES PROMOTION AND PUBLIC RELATIONS
Benefits of Advertising - Developing an Advertising Program: Identify the Target Audience, Define the
Objectives of an Advertising Campaign, Set the Advertising Budget, Objective and Task Method, Percent -
of-sales Method, Affordability Method, Competitive Parity Method, Developing the Advertising Message –
Meaningful, Distinctive, Believable, Message Structure, Selecting the Right Media, Evaluation of
Advertising Effectiveness - Advertising Agencies: Ad Agencies in India - Sales Promotion: Purpose of Sales
Promotion, Importance of Sales Promotion, Decisions in Sales Promotion - Public Relations: Marketing and
PR, Major decisions in PR, Major Tools of PR, Dealing with Unfavourable PR, Sponsorship.
UNIT 21: PERSONAL SELLING AND SALES FORCE MANAGEMENT
Nature and Importance of Personal Selling - Types of Salespersons: Order takers, Order getters, Support
personnel - Personal Selling Process: Prospecting and evaluating, Generating leads, Identifying prospects,
Qualifying the Prospects, Pre-Approach, Approach, Presentation, Handling objections Closing, Follow-Up -
Improving Personal Selling Efforts: Professional training, Negotiations, Relationship marketing - Sales
Force Management: Establishing sales objectives, Fixing the sales quota, Designing the sales force,
Determining the sales force size, Recruiting and selecting salespeople, Routing and scheduling, Training
sales personnel, Compensation, Evaluating sales force, Motivating the sales force.
UNIT 22: DEVELOPING AND MANAGING HOLISTIC MARKETING ORGANIZATION
Trends in Business Environment: Reengineering, Outsourcing, Benchmarking, Collaborating with Suppliers,
Customer Relationships, Mergers, Globalizing, Downsizing, Focus, Empowering - Marketing Organization:
Evolution of a Marketing Department, Simple Sales Department, Sales Department with Auxiliary
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Marketing Functions, Modern Marketing Department, Modern Marketing Company, The Designing of
Marketing Organizations, Functional Organization, Geographical Organization, Product or Brand
Management Organization, Market Management Organization, Corporate/Divisional Organization -
Linkages with other Departments: Research and Development (R&D), Engineering, Manufacturing and
Operations, Purchasing, Finance - Strategies for Organization Wide Marketing Orientation, Outsourcing of
marketing functions & its challenges - Marketing Implementation - Evaluation and Control: Annual Plan
Control, Sales Analysis, Market Share Analysis, Marketing Expense to Sales Analysis, Financial Analysis,
Market Based Score Card Analysis, Profitability Control, Efficiency Control, Strategy Control.
UNIT 23: GLOBAL MARKETING STRATEGIES
Significance of Global Marketing - Selecting a Potential Market: Regional free trade zone, Evaluation of
potential markets - The Impact of Environmental Forces on Global Marketing: Economic environment,
Political environment, Social and cultural environment, Legal and regulatory environment, Technological
environment - Methods of Entering a New Market: Direct exports, indirect exports, Licensing, Joint
Ventures, Internationalization process - Types of Marketing Organization: Export Division, International
Division, Global Organization - Developing Global Strategies: Product Strategies, Promotion Strategies,
Pricing Strategies, Place Strategies.
UNIT 24: DIRECT AND DIGITAL MARKETING
Nature and Scope of Direct Marketing - The Growth and Benefits of Direct Marketing - Database Marketing
Forms of Direct Marketing: Catalogue Marketing, Telemarketing, Kiosk Marketing, Home Shopping,
Other Media - Direct Marketing in India - The Growth of Online Marketing - Advantages and Disadvantages
of Online Marketing -Developing Online Marketing Strategies- Online Advertising: Forums, Newsgroups,
Bulletin Boards, Web Communities, E-mails, Web Casting, Social Media Marketing, Customer experience
management, User generated content - Opportunities and Challenges in Online Marketing.
UNIT 25: MARKETING OF SERVICES
Bases for Service Classification: Classification on the Basis of the Degree of Involvement of Customer:
People processing, Possession processing, mental stimulus processing, Information processing -
Classification on the Basis of the Service Tangibility: Highly tangible, Service linked to tangible goods,
Tangible goods linked to services, Highly intangible - Classification on the Basis of Skills and Expertise
Required: Professional services, Non-Professional services - Classification on the Basis of the Business
Orientation of Service Provider: Not-for-profit organizations, Commercial organization - Classification on
the Basis of the Type of End-user: Consumer Services, Business-to-Business services, Industrial services -
Characteristics of Services: Intangibility, Inseparability, Heterogeneity, Perishability - Developing
Marketing Strategies for Services: Product, Price, Promotion, Distribution, People, Process, Physical
evidence - Service Differentiation: Offer, Delivery, Image - Managing Service Quality: Strategic Concept-
Commitment of the Top Management, High Standards, Monitoring Systems, Customer Co mplaints,
Satisfying Employees, Service Gap Model, Metrics in Service marketing - Managing Productivity - Product
Support Service Management: After-Sales Service Strategy.
UNIT 26: MARKETING OF ORGANIZATIONS, INDIVIDUALS, PLACES AND IDEAS
Organization Marketing: Image Assessment, Image Planning and Control - Idea Marketing - Person
Marketing - Place Marketing.
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UNIT 27: MARKETING MANAGEMENT: ETHICAL AND SOCIAL DIMENSIONS
Importance of Marketing Ethics - Social Impact of Marketing: Individual Customer, Society, Financial tasks,
Economic and production tasks, Maintenance tasks, Political tasks, Environmental tasks, Other businesses -
Social Regulations in Marketing: Consumer rights, Community relations, Green marketing, Consumer
protection act, Consumer forums, Bureau of Indian standards, Competition policy, Environmentalism, Public
action to regulate marketing - Business Regulations in Marketing: Enlightened marketing – Cus tomer-
specific marketing, Social responsibility marketing, Innovative marketing, Value marketing, Sense-of-
Mission marketing, Marketing ethics, Corporate code, Principles of Public Policy Towards Marketing –
Principle of consumer and producer freedom, Principle of curbing potential harm, Principle of meeting basic
needs, Principle of economic efficiency, Principle of innovation, Principle of consumer education and
information, principle of consumer protection.
UNIT 28: GREEN AND SUSTAINABLE MARKETING
Green Marketing – Green washing and Green Marketing Myopia - Green Consumer, Green Products, Eco
Labels and Green Brands - Reasons for the Growth of Green Marketing - Evolution of Green Marketing -
Sustainability: People, Planet and Profit (TBL) - Towards Sustainable Marketing- Sustainable Marketing -
Analysis of Social, Environmental and Economic Dimension - Sustainable Consumer Behaviour -
Sustainable Marketing Values and Goals - Sustainable Marketing Strategy - Sustainable Segmentation,
Targeting and Positioning - Sustainable Marketing Mix - Sustainable Marketing Transformation -
Advantages of Sustainable Marketing.
UNIT 29: MARKETING ANALYTICS
Market Intelligence - Competitive Intelligence - Difference between Competitive Intelligence, Marketing
Intelligence and Business Intelligence - Big Data - Analytics Model - Advertising Analytics.
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CONTENT
Multiple Choice Questions
1. Unit 1: Marketing: the Development of a Concept 1
2. Unit 2: Delivering Customer Values and Satisfaction 3
3. Unit 3: Marketing Environment 5
4. Unit 4: Marketing Budgets and Costs 7
5. Unit 5: Understanding Consumer Buying Behavior 10
6. Unit 6: Organizational Markets and Organizational Buying Behavior 13
7. Unit 7: Marketing Research, Mkis and Demand Forecasting 15
8. Unit 8: Market Segmentation and Market Targeting 17
9. Unit 9: Strategic Planning Process in Marketing 19
10. Unit 10: Marketing and Competitive Strategies 21
11. Unit 11: Product and Product Lines 23
12. Unit 12: Product Differentiation and Positioning 26
13. Unit 13: New Product Development 29
14. Unit 14: Branding and Packaging 31
15. Unit 15: Pricing and Marketing 33
16. Unit 16: Channels of Marketing 36
17. Unit 17: Logistics and Wholesaling 38
18. Unit 18: Retailing 40
19. Unit 19: Communication Mix in Marketing 42
20. Unit 20: Advertising, Sales Promotion and Public Relations 44
21. Unit 21: Personal Selling and Sales Force Management 46
22. Unit 22: Developing and Managing Marketing 48
23. Unit 23: Global Marketing Strategies 50
24. Unit 24: Direct and Online Marketing 52
25. Unit 25: Marketing of Services 54
26. Unit 26: Marketing of Organisations, Individual, Places and Ideas 56
27. Unit 27: Marketing Management- Ethical and Social Dimensions 58
28. Unit 28: Green and Sustainable Marketing 61
29. Unit 29: Marketing Analytics 64
Multiple Choice – Answers and Explanations
30. Unit 1: Marketing: the Development of a Concept 67
31. Unit 2: Delivering Customer Values and Satisfaction 68
32. Unit 3: Marketing Environment 69
33. Unit 4: Marketing Budgets and Costs 70
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34. Unit 5: Understanding Consumer Buying Behavior 71
35. Unit 6: Organizational Markets and Organizational Buying Behavior 72
36. Unit 7: Marketing Research, Mkis and Demand Forecasting 73
37. Unit 8: Market Segmentation and Market Targeting 74
38. Unit 9: Strategic Planning Process in Marketing 75
39. Unit 10: Marketing and Competitive Strategies 76
40. Unit 11: Product and Product Lines 77
41. Unit 12: Product Differentiation and Positioning 78
42. Unit 13: New Product Development 79
43. Unit 14: Branding and Packaging 80
44. Unit 15: Pricing and Marketing 81
45. Unit 16: Channels of Marketing 82
46. Unit 17: Logistics and Wholesaling 83
47. Unit 18: Retailing 84
48. Unit 19: Communication Mix in Marketing 85
49. Unit 20: Advertising, Sales Promotion and Public Relations 86
50. Unit 21: Personal Selling and Sales Force Management 87
51. Unit 22: Developing and Managing Marketing 88
52. Unit 23: Global Marketing Strategies 89
53. Unit 24: Direct and Online Marketing 90
54. Unit 25: Marketing of Services 91
55. Unit 26: Marketing of Organisations, Individual, Places and Ideas 92
56. Unit 27: Marketing Management- Ethical and Social Dimensions 93
57. Unit 28: Green and Sustainable Marketing 94
58. Unit 29: Marketing Analytics 95
xii

MULTIPLE CHOICE QUESTIONS
UNIT 1: MARKETING: THE DEVELOPMENT OF A CONCEPT
NIKE has a business model that allows the customer to purchase a product which is customized to meet
his/her exact needs, for example the colour of his/her shoe, his/her own drawing on shoe or creating a
pair of shoe with his/her size. It has the ability to provide customers with whatever they want, whenever
they want it, wherever they want it and however they want it. This refers to the ________________.
a. Product concept b. Production concept
c. Sales concept d. Marketing concept
e. Societal marketing concept
Industrial Revolution began in the seventeenth century and continued till the late 1920s. During
Industrial Revolution, manufacturing was given importance, and it was assumed that all that gets
produced gets sold. For example, Henry Ford said, “You can have any colour car you want, as long as it
is black”. This was with reference to ____________ .
a. Product era b. Production era
c. Sales era d. Marketing era
e. Societal marketing era
Tata Consultancy Services (TCS) has undertaken sustainable community initiatives such as ‘adult
literacy programs, village development, webHealth Center, etc. as a good corporate citizen and at the
same exceed customer expectations of quality, delivery and cost by following -------approach.
a. Sales orientation b. Marketing orientation
c. Production orientation d. Product orientation
Societal marketing orientation
Narendra Mukharjee started a small readymade garments shop in 1920. At that time, he merely
concentrated on making an adequate number of garments, in a cost effective manner. Through the years,
the shop expanded and went on to become a retail garment house. By 2013, it had started offering
customized garments. Identify the form from the following that reflects the evolution of his business
orientation.
Production to Sales to Marketing orientation
Production to Product to Marketing orientation
Societal marketing to Production to Marketing orientation
Sales to Marketing to Societal Marketing orientation
Marketing to Sales to Production orientation
Companies are offering products based on customers individualized tastes. For example, a restaurant in
New Delhi offers variety of ‘dosas’ such as masala dosa, chi cken dosa, dry fruit dosa, onion dosa, etc.
based on wider customer choice.
a. Selling b. Standardization
c. Customization d. Product focus
e. Segmentation
Toyota Motors uses all types of media channels such as TV advertising, Google paid search, local
Toyota dealership ad, a link to YouTube video and an ad in Car and Driver magazine to promote Toyota
Camry to influence customer at various touch points. Toyota follows -------- approach to gain maximum
advantage out of its communication campaign.
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Work Book: Marketing Management
a. Customization of marketing communication b. Integrated marketing communication
c. Standardization of marketing communication d. Focus more on Internet communication
e. Outsourcing of marketing communication
Marketing in the education industry has gained importance, with the education sector opening up to the
private players. The players are focusing on marketing mix to attract customers. Distance education has
become a priority for many working executives. Distance education is considered as ----element of
marketing mix.
a. Product b. Place
c. Price d. Promotion
e. None of the above
Microsoft has announced that it will fire around 18,000 employees over the next year, which is 15% of
its global workforce of 127,000. The mass job-cut is occurring for two key reasons:There is a lot of
“synergy and strategic alignment” to be made following M icrosoft’s acquisition of Nokia — and, to
provide space so that Microsoft CEO can successfully reorient the company towards his Mobile and
Cloud dream vision. The reorientation of Microsoft’s CEO, Nadella is referred to:
a. Lean operations b. Franchising
c. Decentralization d. Reengineering
e. Value chain analysis
McDonald’s has developed the best franchise model and is best in class at everything it does.
Franchisers around the world wanted to emulate and follow the systems and practices of McDonald’s
model. Which of the following tools can be considered as an invaluable asset for franchisers to enhance
their business practices on the lines of McDonald’s?
a. Insourcing b. Benchmarking
c. Customization d. Standardization
e. Outsourcing
US companies prefer Indian companies to complete their business operations cost-effectively. The
reasons for the transfer of work to India are many such as availability of skilled manpower, cheap labour
rates, quality output, time-to-market, etc. Which of the following concepts helps India to get the work
from foreign companies?
a. Insourcing b. Outsourcing
c. Offshoring d. Customization
Reshoring
2

UNIT 2: DELIVERING CUSTOMER VALUES AND SATISFACTION
Wal-Mart follows EDLP (everyday low price) strategy to provide consistent better value. It forces
suppliers to provide quality goods. It tells employees that customers are always right. Wal-Mart has
become No.1 retailer due to its primary focus on the ____________.
a. Competitors b. Products
c. Customers d. Discounts
e. Promotions
State Bank of India (SBI) has been rated as No. 1 bank in India. It is the leading bank in India when it
comes to number of branches, ATM’s, net profits, total assets managed, etc. With an employee base of
close to 3 Lakh people. SBI commands 20% (approx) of the Indian banking sector. The bank has over
17,000 branches with more than 27,000 ATM’s. The bank manages assets worth more than 390 billion
USD. What business components are explained while describing SBI?
a. Customer base b. Resources
c. Efficient processes d. Organization culture
e. All the above
BMW India offers customers an unparalleled luxury experience with exclusively authentic premium
products, world-class dealerships and high quality after-sales services. These measures are meant
primarily
a. Generate more profits b. Introduce more luxury cars
c. Enhance customer satisfaction d. Expand dealer network
e. Eliminate competitors
GAP, American clothing retailer, has boosted margins by streamlining its organization by reducing
inefficiencies in its supply chain and cutting costs. An organization’s capability to realize a profit
margin depends on their ability to manage the linkages between all activities.
a. Cost-benefit analysis b. Value chain analysis
c. Market analysis d. Sales analysis
e. Competitor analysis
Indian Oil Corporation Ltd (IOCL) is primarily engaged in the business of refining the crude oil and
generating the petroleum products. It is not engaged in the production/extraction of crude oil (which is
done in India by OIL/ONGC etc.). It is not engaged in the automobile sector where the major part of the
petrol and diesel produced by it, are consumed. Further, IOCL does not own all the petrol bunks where
its oil is distributed. It engages middlemen for distribution of its products by allotting dealership to
petrol bunks. Which of the following reflect all these activities?
a. Value chain of IOCL b. Value Chain of Oil Industry
c. Value Chain of ONGC d. Vendor management of IOCL
e. Activity Based Costing of IOCL
Future Group has taken the whole concept of customer loyalty to the next level by joining hands with
PAYBACK. PAYBACK is India’s largest and one of Europe’s most successful multi-partner loyalty
programs. This program enables consumers to collect millions of points across online and offline
partners – with just a single card. Today, with more than 30 partners with 1,500 outlets and 10 million
card members, it’s the only program which works with mar ket leading pan-India players from the
banking, travel, petroleum and online sectors such as ICICI Bank, HPCL, Univercell, BookMyShow
and MakeMyTrip. The basic motive behind PAYBACK loyalty program is _______________.
3

a. Customer retention is more profitable b. Attracting new customers is easy
c. Customer retention is difficult d. Attracting new customers is
e. PAYBACK program may benefit few players easierthan retention
Michael Dell, the founder of Dell says "At Dell, we’ve always tried to exceed customer expectations
with our products and services. When you delight yourcustomer – consistently – by offering better
products and better services,you create strong loyalty. When you go beyond that to build a meaningful,
memorable total experience, you win customers for life. Our goal, at the end of the day, is for our
customers to say, Dell is the smarter way to buy a computer." Identify the approach followed by Dell.
a. Basic marketing b. Reactive marketing
c. Accountable marketing d. Proactive marketing
e. Partnership marketing
Ascent Software Company Ltd, New Delhi wanted to segregate customers based on customer
profitability. It has identified a list of profitable customers and its level of dependence on these
customers. It has also identified the unprofitable customers and the amount of the company’s resources
being consumed by them. Which one of the following approaches is followed to segregate profitable
customer and unprofitable customer?
a. Activity Based Costing b. Action Based Costing
c. Expenditure Based Costing d. Revenue Based Costing
e. Customer Based Costing
Shoppers’ Stop provides special benefits like additional discounts to the ‘First Citizen’ club members. It
has developed long-term relationship with the customers through its relationship marketing strategies.
How do you think Shoppers’ Stop has influenced customers to become loyal?
a. Customers –clients –members of the company club – advocates
Clients –members of the company club – advocates -cus tomers
Members of the company club – advocates-customers – clients
Advocates -customers –clients –members of the company club
Advocates –customers-members of the club-clients
Srujana Electricals Ltd. sells emergency lamps to customers. The company does not bother to meet
them again to check whether the product is working properly or not. Which of the following is being
followed by the company?
a. Accountable marketing b. Partnership marketing
c. Reactive marketing d. Basic marketing
One-time marketing
4

UNIT 3: MARKETING ENVIRONMENT
Tata NanoSingur faced a controversy generated by land acquisition of the proposed Nano factory of
Tata Motors at Singur in Hooghly district, West Bengal, India to manufacture Rs. 1 lakh people car. The
project faced massive opposition from displaced farmers. The unwilling farmers were given political
support by West Bengal’s opposition leader, Mamata Banerjee. Banerjee’s "Save Farmland" movement
was supported by environmental activists like Medha Patkar, AnuradhaTalwar and Arundhati Roy.
Which of the following marketing environmental factors influenced Tata Motors to finally move out of
Singur to set up TataNano plant in Sanand, Gujarat?
Industry-friendly policies of Gujarat Government
Lack of support from local community in West Bengal
c. Loan facility from Gujarat Banks d. a and b
e. Technological factors
India is facing coal shortage despite having some of the largest coal deposits globally. The shortage of
coal supply also hampers India’s growth prospects in terms of energy deficiency in manufacturing and
other sectors. Coal India Limited (CIL) is the largest producer of coal in India. NTPC recently claimed
that CIL supplied inferior quality coal and also stopped coal purchases on the grounds of huge dues. The
other charge was that CIL was simply leveraging its power to pass off substandard coal at premium
rates. NTPC and other buyers say that they need independent third-party certified quality control and
grading of coal. The coal market competition in India can be described as_________________.
a. Oligopoly b. Monopoly
c. Pure competition d. Monopolistic competition
Nielsen has released the findings of the Indian Smartphone User study conducted recently, and the
numbers thrown up are very interesting. The country currently has 900 million mobile phones in use,
out of which 40 million are smart phones. Deeper into those numbers, the survey reveals that 50% of
those 40 million smart phones are with people under the age of 25. Which of the following marketing
environmental factors should be focused on by the smart phone companies to gain market share?
a. Demographic environment b. Political environment
c. Economic environment d. Naturalenvironment
e. Legal environment
ᜀ Ā ᜀ Ā ᜀ Ā ᜀ Ā ᜀ
r Reddy’s Labs’ (DRL) share price dipped about two per cent following a verdict delivered by a US
court that a generic drug manufactured by the company’s would infringe the innovator’s patent. The
United States Court of Appeals for the Federal Circuit ruled that the generic drug would infringe on the
patent of Sunovion Pharmaceuticals’ insomnia treatment drug Lunesta. Sunovin is a wholly-owned
subsidiary of Osaka-based Dainippon Sumitomo Pharma Co. Ltd (DSP). Which of the marketing
activities of Dr. Reddy’s Labs’ (DRL) were influenced in th e U S?
a. Consumer protection Act b. IntellectualpropertyAct
c. Non-government regulatory agencies d. Political environment
e. Economic environment
The Consumer Complaints Council (CCC) under the Advertising Standards Council of India (ASCI) has
banned as many as 177 advertisements across segments during July 2013. Among these are ads from
prominent companies like Nivea, L’Oreal, Hindustan Unilever (HUL), Dabur, ITC, Audi, Maruti Suzuki
and Apple India; they range from FMCGs to autos, personal accessories to alcohol, and education to
media. The advertising environment in India is regulated by __________ .
a. Non-government regulatory agency b. State regulatory agency
c. Natural environment d. Economic environment
Consumer protection act
5

The number of new cars sold annually was a reliable indicator of the nation’s economic health. The
automakers industry experienced a global decline of overall demand during the 2008-2010 periods due
to a global financial crisis which seemingly started off in North American mortgage crisis. The financial
downturn affected auto manufacturers all round the globe, but the worst hit automakers were the
American “big three” consisting of Chrysler, Ford and Ge neral Motors. Which of the following
business cycles during the 2008-10 influenced ‘big three’?
a. Growth b. Recovery
c. Recession d. Slump
e. Boom
To increase competition in the smart phone space and to boost to gain market share in the consumer
lending business, ICICI Bank announced EMI (equated monthly instalment) facility on debit cards to
enable its customers to convert their high value transactions into easy instalments. The bank has tied up
with Samsung India to offer this facility. The debit card holders can pay in EMIs of 3, 6, 9 or 12. The
Interest rate will be calculated on reducing balance method. The current interest rate is 13% for tenures
till 12 months. Most banks currently offer EMI facility only on credit cards. The purpose behind EMI
facility is to --------
a. Enhance buying power of customers b. Enhance selling power of customers
c. Enhance buying power of Samsung d. Enhance buying power of ICICI Bank
e. Enhance selling power of ICICI Bank
Starbucks launched “Tweet a Coffee” to engage customers an d build awareness of the brand. Not only
do they provide giveaways, but Starbucks always creates content that encourages its fans to like,
comment, and share. Starbucks wanted to use social media technology for the following purpose.
a. To reduce price of the product b. To transportthe goods faster
c. To enhance the connectivity with customers d. To eliminate competitors
e. To minimize advertising cost
Gopal Shinde is a customer of mobile service provider ABC, in Mumbai, India. Unsatisfied with the
coverage problem, he decided to opt for mobile number portability option and switch to a better service
provider XYZ. After applying for number portability, for nearly six months he was made to wait for
various reasons. At the end, his present provider ABC convinced him that they will improve the
coverage in his house and fixed a booster. Gopal Shinde is still not happy with the coverage. He can
approach the following agency to keep a check on mobile service providers to get a quality service.
a. District consumer forum b. Mobile service provider ABC
c. Mobile service provider XYZ d. TelecomRegulatory AuthorityofIndia (TRAI)
e. High Court of Maharashtra
Chakor Jain, Business Head of Lee India said, “According to e stimates, the size of the denim market in
India is about 65-70 million pairs. It is a large structured industry growing at about 15-20% a year. We
are only growing as there is a robust demand for denim in India”. The ‘Lee’ brand is experimenting with
different washes like washed down denims, dark washes and fabrics like back stretch fabric, fabrics
which are coated and Jeggings—a hybrid between jeans and l eggings that offer greater stretchability.
Denim majors are selling big in India with aggressive plans lined up to launch new brands and
innovative trends for the market. The new trend for denim market is due to -------------.
a. Socio cultural forces b. Legal environment
c. Competitive forces d. Government supportive policies
Scarcity of Khadi in India
6

UNIT 4: MARKETING BUDGETS AND COSTS
The CEO of Nagpur Mineral Bottling Ltd. directed CMO Mr. Santosh Kapadia to examine the costs
associated with each individual marketing activity to assess the profitability of each. Santosh Kapidia
identified inventory handling, channel margin and advertising, are absorbing most of the expenditure
without adding much value. CEO advised CMO to cut one level of channel and install Supply Chain
Management software to handle inventory in an efficient way. CEO also advised CMO to cut
advertising cost to one-third and focus on social media to promote the brand. The changes have helped
the company to increase its profit by 20% and reduce its costs by 40%. Which of the following concepts
is followed by the CEO and the CMO to increase the profit and reduce the costs of the company?
a. Sales analysis b. Profit analysis
c. Revenue analysis d. Marketing cost analysis
Financial situation analysis
32. Dr. Robert Kaplan of Harvard Business School stated “…the most profitable 20% of customers generate
between 150 and 300% of total profits. The middle 70% of customers about break even, and the least
profitable 10% of customers lose 50 – 200% of total profits , leaving the company with its 100% of total
profits. And, often, some of the largest customers turn out to be the most unprofitable.” Which of the
following methods is used by the company to differentiate customers into profitable, break-even and
least profitable categories?
a. Sales analysis b. Balance sheet analysis
c. Profit analysis d. Customer satisfaction analysis
Customer profitability analysis
Answer Q33, Q34 and Q35 are based on the following graph.
http:/ / www.worldofapple.com/ category/ apple-financial-news/
Apple has announces Q3 2014 Profit of $7.7 Billion on Revenue of $37.4 Billion. The iPad Unit Sales
between Q3 2010 – Q3 2014 are shown in the graph.
Apple’s Gross margin was 39.4 percent in Q3 2014 compared to 36.9 per cent in the year-ago quarter
i.e. Q3 2013. What was the cost of goods sold during Q3 2014?
a. $22.66 billion b. $22.66 million
c. $2.266 billion d. $2.266 million
$226.6 billion
7

34. The sales of iPad Units increased during Q1 2011 and Q4 2011 by ---- units.
a. 30,000,000 million b. 18,750,000 million
c. 11,250,000 million d. 7,500,000 million
e. 3,750,000 million
Which of the following ‘Quarter’ has shown the maximum i Pad sales during the year 2013?
a. Q1 2013 b. Q2 2013
c. Q3 2013 d. Q4 2013
Wal-Mart is a dominant player in retailing. The company’s size provides it with enormous efficiency that it
uses to keep costs low. For example, its size allows Wal-Mart to do its purchasing more efficiently since
it has roughly 5,000 large stores worldwide. This gives the company tremendous bargaining power with
its suppliers. Not only does it get its products cheaper, but its size allows it more inexpensive
distribution. Which of the following factors has helped Wal-Mart to gain all these advantages?
a. Economies-of-scale b. Better negotiation skills
c. Customer relationship management d. Vendor relationship management
e. Better overhead management
The Boston Consulting Group (BCG) came out with a research finding that ‘there is a strong
relationship between the cost of production and the cumulative volume of production (total units
produced from the first unit to the last)’. Himachal Pradesh Metals Private Limited (HPMPL) wanted to
test the BCG’s research finding on Manganese production. HPMPL has experienced a consistent cost
reduction with increase in Manganese production. Identify the factor from the following that is
concluded by HPMPL and is responsible for cost reduction through employee productivity.
a. The economies-of-scale b. The production curve
c. The sales curve d. The experience curve
e. The technology adoption curve
Ashok Chandra has become an expert in web designing with his increased volume. The time taken for
website designing over a period of time surprised him with outstanding results. Ashok Chandra is able
to design more websites in less time and he has also noticed that there is a hidden relationship between
time spent and number of websites designed. For example, if the first website takes 100 hours, then after
the second website the cumulative average time will be 80 hours (80% of 100 hours). The cumulative
average of 80 hours consists of 100 hours for the first website plus only 60 hours for the second website
resulting in a total of 160 hours divided by 2 websites. After the fourth website the cumulative average
time will be 64 hours (80% of 80 hours). After the eighth website the cumulative average will be 51.2
hours (80% of 64 hours). In other words, the total time to have completed all eight websites will be
409.6 hours (8 websites times an average time of 51.2 hours).
Ashok Chandra has found that ‘the cumulative average time to complete a manual task decreases 20%
whenever volume doubles’. Which of the following describes the hidden relationship between time
spent and no. of websites designed?
a. 80% Learning effect b. 80/20 Pareto’s rule
c. 80% Efficiency curve d. 80 % sales curve
e. 80/20 profit-sales relationship
Hero MotoCorp Ltd. (Formerly Hero Honda Motors Ltd.) is the ‘World No.1’ two-wheeler company in
terms of unit volume sales in a calendar year. Hero MotoCorp Ltd. continues to maintain this position
till date. Indian customers still consider two-wheeler as an expensive product. Hero MotoCorp Ltd. is
able to offer the two-wheeler to Indian customers at a cheaper price based on experience curve effect
when it reaches ---------- stage of Product Life Cycle as shown in the diagram.
8

a. Product development b. Introduction
c. Growth d. Maturity
e. Decline
Arvind Eye Care System (AECS) is one of the best eye hospitals in the world in terms of productivity
and scale. An assembly-line approach has helped AECS to become the best player in cataract surgery.
India is a home to a quarter of the world’s blind, and every year at least 4 million Indians develop
cataracts, the major cause of blindness. Arvind’s doctors perform 2,000 surgeries a year versus the
national average of 400 and few doctors perform cataract surgery just in 3.5 minutes. What factors
helped AECS doctors to perform 2000 surgeries with a time span of 3.5 minutes?
a. More patients b. Efficiency of doctors
c. Experience of doctors d. b and c
Chance
9

UNIT 5: UNDERSTANDING CONSUMER BUYING BEHAVIOR
Two of the country’s most visited pilgrimage sites, wher e McDonald’s planned to serve all vegetarian
fare for the first time, are near the Golden Temple in Amritsar and Jammu and Kashmir’s Katra town,
the base of Vaishno Devi shrine. Out of the two, the all-vegetarian McDonald’s is now operational at
Amritsar. Restaurant manager Harjinder Singh said, "Prior to paying obeisance in the Golden Temple it
is good to have vegetarian food. I request and invite people to grab a vegetarian bite before going to the
shrine." What factors have influenced McDonald’s to go for 100 percent vegetarian menu at restaurants
near the Golden Temple and the Vaishno Devi Shrine?
a. Cultural factors b. Economic factors
c. Social factors d. Political factors
e. Demographic factors
Smartphone penetration by age in 10 countries is shown in the following table. In which country, does the
Smartphone penetration increases with the increase in customer age group most of the times?
S. No Country Smartphone Penetration by Age in %
16-24 25-34 35-44 45-64
1 South Korea 86 90 70 50
2 China 83 80 68 52
3 Australia 80 81 72 52
4 United Kingdom 78 82 70 48
5 United States 68 79 70 49
6 Italy 60 78 80 50
7 Russia 50 42 40 60
8 Brazil 40 40 40 30
9 Turkey 30 25 20 15
10 India 10 10 10 10
a. India b. Australia
c. Italy d. Russia
e. China
Italian super carmaker ‘Lamborghini’ has opened a second showr oom in New Delhi after Mumbai in a
bid to sell 20 cars in India. Lamborghini, which is owned by Volkswagen, thinks India’s super-rich have
an appetite for their expensive cars, despite the country’s high taxes on luxury vehicles and notoriously
potholed roads. In India, Lamborghini sells two models, the Gallardo and the Aventador, priced between
Rs. 2.8 crore and Rs. 6.3 crore (ex-showroom Delhi) with a top speed of 217mph. The company is
planning an SUV range that should be ready by 2017. Lamborghini’s Indian customers are "much
younger" than those in Europe, with a typical buyer being a first-time entrepreneur in their 30s. The
following factors influence customers to purchase Lamborghini cars in India.
a. Aspiration reference group b. Disclaimant reference group
c. Membership reference group d. Avoidance group
e. Secondary reference group
The global fashion brand Diesel gives special importance to celebrities. The company CEO says ‘th ey
bring eyeballs to the brand. Fans love them and love what they are wearing. They define trends. So it is
important that they try and wear Diesel. We never sign contracts with celebrities because we want them
to choose our brand on their own. It is our philosophy’. Why does Diesel show special interest in
celebrities?
10

a. To minimize promotional expenses b. Celebrity is seen as a reference group
c. To take feedback on future trends d. Influencing celebrities to promote the brand
e. To keep competitors away from celebrities
Xavier and Mercy are couples living in New Jersey have purchased new IKEA tasteful furniture. They
have also purchased BMW very recently. They also do more travelling and spend more on dental bills
and magazines. Xavier and Mercy are in the --------------stage of family lifecycle that help companies to
target their needs.
a. Full nest III b. Newly married couple
c. Bachelor stage d. Full nest I
Full nest II
After entry into India, McDonald’s has made an addition to its earlier menu with the latest product, the
McEgg Burger. With this launch, McDonald’s aims to open up to a completely new segment of
customers who do not eat non-vegetarian food, but eat eggs. McDonald’s has gone for an advertising
campaign spread across traditional vehicles like outdoor, print and radio, along with engagement-led
media like mall activation and consumer promos. The television campaign for McEgg consists of three
films, each showing people eating McEgg Burgers and voicing chicken-like sounds thereafter.
Commenting on the new launch, Rajesh Kumar Maini, general manager, corporate communications,
McDonald’s India (North and East), pointed out that the launch opened up a new segment of consumers,
‘Eggetarians’. The purpose behind advertising campaign is to ----
Influencing non-vegetarians to become eggetarians
Changing perceptions of vegetarians to become eggetarians
Shaping attitudes and beliefs of vegetarians to become eggetarians
Motivating customers who do not eat non-vegetarian food but eat eggs to purchase McEgg Burger
Motivating non-vegetarians to buy McEgg Burger
A survey by International Data Monitor Inc. shows that ‘in Europe and the U.S. the gap between the
young and the old is not much. Now consumer groups are not fixed by age as much as they are by
lifestyle. It is not uncommon to find couples with an age difference of 20-30 years. The young and not-
so-young want to look and feel the same. Both of themwant to look cool and fashionable. They want to
wear similar kinds of clothes and accessories that are considered in fashion. So, there is no target group
and the real focus is on lifestyle’. Fashion retailers have to focus on the --------factor to influence
consumer buying behaviour.
a. Sub culture b. Social class
c. Lifecycle d. Family
e. Individual taste
Table Mate is a portable table and can be carried anywhere along with the customer. Table Mate is
suitable for everyone due its adjustability in shape. It has perhaps been the most advertised product ov er
the internet, due to its features it has got a huge acclaim everywhere. It is an outstanding product that
can be used for various indoor and outdoor activities. Its storing is also easy just by folding it and put it
under a sofa or bed. The family members play various buying roles in a purchase decision. What is the
role played by a mother in Table Mate purchase decision?
a. Initiator b. User
c. Buyer d. Decider
e. Maintainer
Harvard Business School (HBS) is consistently ranked among the foremost business schools in the world.
In the most recent rankings of US business schools, HBS ranked #5 in the Financial Times. Students can
join one or more of the more than 80 clubs on campus. The clubs invite speakers to campus; organize
trips, social events, and help forming bonds between students of similar interests. The
11

Student Association (SA) is the main interface between the MBA student body and the
faculty/administration. No two HBS students are alike and similarly, no two HBS career paths are alike.
Rakesh Malhotra, a final year engineering student from Dehradun in India, wants to join HBS for MBA
program in the next academic year. Rakesh Malhotra displays the following buying behaviour?
a. Variety seeking behaviour b. Routinized buying behaviour
c. Extensive problem solving behaviour d. Executive problemsolving behaviour
e. Unique buying behaviour
Indo-Japanese joint venture Toyota Kirloskar Motor (TKM) has recalled 44,989 units of the multi-utility
vehicle ’Innova’ manufactured between February 2005 and Dece mber 2008. According to the
company, the recall has been mandated due to an error discovered in the spiral cable mounted on the
steering wheel. The recall is a part of a global exercise as the company plans to fix 6.58 million vehicles
around the world which may suffer from faults in steering and seats. This will be one of the largest
vehicle recalls to date in the global auto industry. The company wanted to influence the _______ stage
of the buying decision process of customers.
a. Problem recognition b. Information search
c. Evaluation of alternatives d. Purchase decision
Post purchase behaviour
12

UNIT 6: ORGANIZATIONAL MARKETS AND
ORGANIZATIONAL BUYING BEHAVIOR
L&T Hyderabad Metro Rail Ltd (LTMRHL) has placed an order to purchase Metro Trains with
Hyundai-Rotem Factory, South Korea for Hyderabad Metro Rail project. V.B. Gadgil, chief executive
and managing director, LTMRHL has experienced the ----------organizational buying situation while
placing an order for Metro Trains from the Hyundai-Rotem Factory.
LTMRHL wanted a customized rebuy
LTMRHL wanted to buy Metro trains first time as New task
Hyderabad people are interested in customized buying
LTMRHL wanted to buy Metro trains as System buying
LTMRHL are interested in modified rebuy
Tata made a big bet on the Nano, the people car priced at around $2000. It spent close to $400 million
developing the vehicle and hundreds of millions more building a factory capable of manufacturing
15,000 to 20,000 of the tiny cars a month. With sales now hovering around 2,500 a month, down froma
peak of about 10,000 in April 2012, that means a lot of idle capacity at the plant in the western state of
Gujarat, and a lot of frustrated Tata dealers around the country.Identify the type of demand from the
following that Tata Nano is experiencing in India today.
a. Inelastic demand b. Derived demand
c. Joint demand d. Fluctuating demand
e. Elastic demand
Driving down the price of the Tata Nano couldn’t have been done without the collective effort of the
component suppliers. Tata Johnson Controls developed the seats for the small car. Tata TACO worked
on parts like interior injection mouldings, dashboard aggregates and door handles. Bosch was asked to
develop the engine management system for the car.Kinetic Engineering supplied the transmission gears
for the car, a crucial component in the drivetrain. Who of the following is considered as the Original
Equipment Manufacturer (OEM)?
a. Tata Nano and Bosch b. Tata JohnsonControls
c. Tata Taco and Tata Nano d. Bosch and Kinetic Engineering
Tata Johnson Controls, Tata taco, Bosche
Anglo-Italian firm Agusta Westland has submitted its bid for two military tenders to supply helicopters
to the Indian Navy and the Indian Coast Guard. The firm has submitted its response to Indian Navy’s
tender for procuring 56 naval utility helicopters and Coast Guard’s Request for Proposal (RPF) for
buying 14 medium-lift choppers. Why does Indian military follow the procedures of tenders and RPF?
Government markets wanted to delay the purchase decision
Indian military wanted to buy directly from Agusta Westaland
Military officials are incompetent in direct purchase
To bribe players for a better price
To enhance transparency in military purchases
The University of Chicago had opened a centre in New Delhi. Virginia Polytechnic Institute and State
University, known as Virginia Tech in on the way to open its center. Harvard Business School has an
Indian research centre in Mumbai and Deakin University, a well-known name from Australia, has a
centre in New Delhi. Some global higher education brands are opening research centres to capture a
portion of the growing market of executive education and other research partnership opportunities.
Foreign universities are yet to open independent campuses in India due to ______________.
13

a. Organizational factors b. Social factors
c. Personal factors d. Environmental factors
e. Financial factors
Telangana government has decided to purchase 1500 cars for its police department. The two brands
which are competing against each other to get the order from the Telangana government are Ertiga and
Innova. Maruti Car Company representatives presented their Ertiga car before the higher officials of
government and police officials and explained them the huge difference between the price and mileage
of the two cars. Which of the following roles is played by Government and Police officials in the
organizational buying?
a. Police officials as Initiators b. Government as Influencers
c. Police officials as Buyers d. Government as Users
e. Police officials as Gatekeepers
According to a Retail Journal from the Boston, US, the retail giant Wal-Mart, stocks products made in
more than 70 countries and at any given time, operates more than 11,000 stores in 27 countries around
the world, and manages an average of $32 billion in inventory. Over the past ten years, Walmart has
become the world’s largest and arguably most powerful retailer with the highest sales per square foot,
inventory turnover, and operating profit of any discount retailer. In its transition fromregional retailer to
global powerhouse, the organization has become synonymous with the concept of successful ------------.
a. Buying b. Supply ManagementOrientation
c. Vendor Management Orientation d. Customer Management Orientation
Retail Store management
Airports Authority of India (AAI) aims to expand airports in Tier-II and Tier-III towns across country in
the next five years. AAI has already identified Surat as one of the cities where 70% of customers prefer
to travel by air. AAI is at the ----stage of organizational buying process for setting up an airport at Surat.
Surat people requested AAI to recognize general need of Surat people
AAI has recognized a problem with Air travel of Surat people
Surat needs an airport with capacity of 20 lakh population/annum
Searching for suitable land for airport
Surat government issued a notification for Vendor analysis
Embraer S.A., a Brazilian aerospace company, has signed an agreement with India’s Air Costa for an
order for 50 E-Jet planes. The acquisition is a mix of 25 E190 and 25 E195 Jet planes and has an
estimated value of USD 2.94 billion based on 2014 list prices. Air Costa has become the first customer
of E-Jet planes in the Indian market and will take delivery of the 50 Jet planes in 2018. Air Costa is at --
-----stage of organizational buying process to purchase 50 E-Jet planes
a. Product specification b. Searching for potential suppliers
c. Value Analysis d. VendorAnalysis
e. Order Routine Specifications
NTPC has decided to give away contracts to set up Rs 11,800 crore power plant in Chattisgarh. NTPC has
received bids from three firms - BHEL, L&T and Doosan Heavy Industries. NTPC officials say ‘We
will evaluate the bids and call price bids from the qualifying companies." NTPC is at ---------------stage
of organizational buying process to set up power plant in Chattisgarh.
a. Problem recognition b. Product specifications
c. Searching for potential suppliers d. multiple sourcing
Performance review
14

UNIT 7: MARKETING RESEARCH, MKIS AND DEMAND FORECASTING
Rural Marketing Association of India (RMAI) is a national industry body with a membership base of more
than 70 companies that promotes the cause of promoting rural marketing. With 12.2% of the world’s
population, rural India represents the single largest potential market and accounts for 53% of FMCGs
and 59% of durables sale in India. The rural market has therefore become vital for the growth of most
companies. The association undertakes market research to enable________________.
Improving the overall understanding ofrural markets
Increase knowledge base of rural marketers
Promote, improve, develop and further the cause of rural marketing in India.
(a), (b) and (c)
(b) and (c)
In 1979, Xerox researched Japanese competitors to understand how they could sell mid-size copy machines
for less than what it cost Xerox to make them. Today, a lot of companies frequently use benchmarking
as a standard research tool. The design of the research plan employed in the said example
is____________.
a. Exploratory b. Descriptive
c. Causal d. (a) and (b)
e. (a) and (c)
ȀĀᜀĀ ᜀ Ā ᜀ Ā ᜀ Ā ᜀ
igher end fine dining restaurants in the city like Zaffran, gives their customers a form to be filled up
giving their valuable feedback in terms of ambience, food, service quality, areas of improvement etc.
This kind of market research instrument to collect primary data is referred to as___________.
a. Mechanical instruments b. Sampling
c. Questionnaires d. Personal interview
One to one interviews
The New York Times collected Twitter traffic during the 2009 super bowl and produced stunning
visualization of comments throughout the game. The primary data collection and secondary data
collection differs in_________.
Secondary data collection is cheaper and less time consuming.
Secondary data is there all around us and more accessible than primary data.
Secondary data can be more powerful and reliable than primary data.
(a) and (b)
(a) and (c)
Wal-Mart knows the sales of each product by store and total each evening. This enables it to transmit
nightly orders to suppliers for new shipments of replacement stock. Wal-Mart shares its sales data with
its large suppliers such as P&G and expects P&G to re-supply its stores in a timely manner. This
component of MkIS is referred to as______________.
a. Order to payment scale b. Sales information system
c. Marketing intelligence system d. Marketing decisionsupport system
e. Data warehousing
American Airlines produced a marketing decision support system that helps decide how much to
overbook and how to set prices for each seat so that a plane is filled and profits are maximized. Which
of the following benefits the Marketing decision support system?
15

a. Speed up problem solving in an organization b. Helping automate managerialprocesses
c. Speed up the process of decision making d. (a) and (b)
e. (a), (b) and (c)
Irish House, the famous pub is a brand catering to the niche. The patrons can enjoy the Irish alcoholic
beverages and food in their pubs and also happy hours every day at particular time period. With retro
music played by the in-house DJ’s, the pub is upbeat for its Irish ambience and culture. This type of
market is referred to as_____________.
a. Potential market b. Available market
c. Qualified available market d. Target market
e. Penetrated market
McDonald’s, with its locations all over the globe, introduced Mclobster in their menu. They experimented
this within theirown restaurants,by doing small, local promotions and offering it on their menu with a big “
NEW” next to it. Having been not ve ry profitable to commercialise, they reintroduced over the years as a
seasonalproduct andtargetedcoastalconsumers who love theirseafood.This method of estimation of future
demand for products is referred to as__________________.
a. Composite sales force opinion b. Survey of buyerintention
c. Past sales analysis d. Statisticaldemand analysis
Test marketing method
The USDA, on November 16, released its most recent forecast of meat production and consumption through
the rest of 2012 and the year 2013. These projections indicate a continued decline in the per capita
consumption of all four major meat categories: beef, pork, chicken and turkey. But, consumption is not
the same as demand. For example, when prices rise or incomes fall, the per capita consumption of
product may drop but not necessarily the demand for the product. Animal advocates are interested in
reducing per capita meat consumption, but they are even keener on actually reducing the demand for
meat. Which of the following describes the advantage of statistical demand analysis?
Determines the effect of factors like marketing expenditure and price of product on sales
To find a business’s potentialdemand in order to make accurate decisions about pricing business
growth and market potential
To enter into a new market
All of the above
(b) and ( c)
If the target market for Coca-Cola is the US market for soft drinks, then when Coca-Cola took their
products to Russia, that was an example of market development since the market potential for Coca-
Cola increased. The Volkswagen Beetle is increasing its market potential by making its newest version
more masculine. Finally, Evian placed their bottled water in both the regular and health sections of
grocery stores. This expanded their market potential by appealing to different psychographic
segments—in effect broadening their target market to includ e regular water drinkers and health-seeking
water drinkers (who perhaps before bought specific heath drinks).It is also possible for existing brands
to find new uses for their products. This classification of market is referred to as_________.
a. Potential markets b. Nascent market
c. Target market d. New market
Qualified market
16

UNIT 8: MARKET SEGMENTATION AND MARKET TARGETING
GM has identified about 40 different ‘customer needs” and c orrespondingly, 40 different market
segments in which it would present with its vehicles. For example, it has targeted the Pontiac at active
sports- oriented, young couples, the Chevrolet at price conscious young families, the Oldsmobile at
affluent families, and the Buick at older, more conservative couples. In the light of the said example
identify the need from the following for market segmentation.
Grouping consumers who have similar tastes and design product mix in such a way so as to appeal
to the target market
Increase in market share and higher profits
Companies that lack resources to tap mass market can adopt segmentation.
(a) and (b)
(a), (b) and ( c)
Eureka Forbes uses direct salesmen to visit different houses and sell their famous water purifier
AQUAGUARD, after providing demo and information about the product. That way Eureka Forbes is
able to target mass market individually, who falls into the segment of consumers installing water
purifiers in their household. The strategy adopted by Eureka Forbes is-
a. Mass marketing b. Segment marketing
c. Individual marketing d. Local marketing
Niche marketing
Harley Davidson manufactures higher end niche bikes, Mont Blanc manufactures higher end platinum
tipped, gold covered higher end fountain pens for connoisseurs of writing instruments, Abercrombie and
Kent markets their very exclusive higher holiday packages to exotic destinations for higher end
customers. In the light of the above examples of niche marketing, which of the following are the key
features of niche marketing?
Sellers cater to a very specific market segment which requires more attention and very high quality
of services.
Operates in very high competition among sellers to target the focus group
Segment size is small and sellers can charge premium pricing for the higher quality and services.
(a) and ( c)
(a) and (b)
Titan created a sub brand, FASTRACK. These watches are specifically designed for younger
generation. While SONATA and the steel series caters to the older and professionals. This is an example
of segmentation classified based on______ factors.
a. Geographic b. Demographic
c. Psychographic d. Behavioural
e. Technological
Hallmark cards, greeting cards for all occasions used the strategy of promoting its cards in a manner
that, be it any occasion, the right kind of card can be found by the customer and thereby enabling
him/her to express themselves to the receiver of the card perfectly. The variable highlighted in this
segmentation is__________.
a. Occasions b. Benefits sought
c. Usage rate d. Loyalty
Attitude
17

Tata Motors manufactures and sells their cars in the Asian, East European and Middle East through a
vendor tie up in the respective locations. Citigroup, headquartered in US, have global operations divided
into Europe, Asia, Middle East and Africa. This is an example of segmentation of Organizational
markets based on ___________variable.
a. Demographics b. Geographic
c. Company size d. Industry
e. Company technology
Liril of HUL has a commanding position in segmentation wherein its brands Pears and Dove are well
entrenched in the premium segment and therefore enjoy a differentiation advantage and are marketing
savvy. They strategise and position this brand in the premium segment by innovative marketing and
therefore enjoy continued access to this segment. HUL has been effective in its segmentation strategy by
being________.
a. Accessible b. Measurable
c. Substantial d. Differentiable
e. Actionable
Samsung Electronics, especially their television sets and air conditioners are targeted to the entire
market and not a particular segment. They also have positioned their smart phones to cater to the entire
market with phones being available from the range of Rs.10,000 to Rs.45,000. This is an example of
___________strategy employed by Samsung to target their customers.
a. Concentrated marketing b. Full market coverage
c. Segment by segment invasion plans d. Product specialization
e. Market specialization
Marriott International has fifteen different types of facilities designed to meet the needs of different
types of market segments which are Marriott Courtyard targeted at over the road travellers, Ritz Carlton
targeted at luxury travellers, Marriott Conference centers targeted at businesses hosting small and
midsized meetings, Marriott vacation clubs targeted at travellers seeking to buy timeshares. This target
marketing is an example of ___________ strategy.
a. Selective specialization b. Single segment concentration
c. Segment interrelationships and supersegments d. Segment by segment invasion plans
Product specialization
Swarovski markets their very unique and exclusive crystal jewels at their exclusive outlets, targeting
higher end prestigious customers who have a taste for crystal jewels. Watch makers like Choppard, Tag
Haeur, Omega etc manufactures watches with finesse and precision engineering, targeted to premium
customers. These are examples of single segment concentration. In the light of the above, which of the
following are the key features of single segment concentration?
Benefits marketers with high sales as all his marketing efforts are concentrated on the segment.
Marketers can serve single segment successfully if improvisations are made to the product in
keeping with changes in the tastes and preferences of their customers
If their customers stop patronizing the product for some reason, the marketer will face severe loss
(a), (b) and (c)
(a) and (c)
18

UNIT 9: STRATEGIC PLANNING PROCESS IN MARKETING
Starbucks mission statement says “ To inspire and nurture the human spirit-one person, one cup and one
neighbourhood at a time”. In the wake of the said examp le, which of the following commercial mission
statements consist of the essential elements?
Identify and describe the key market
Spell out the contribution which is, mentioning the product or service provided to the key market
Highlight the distinction by mentioning what makes the product or service unique that the key
market would chose this product or services over the others
(a) and (c)
(a), (b) and (c)
At Dell computers, segmentation initially started as a sales concept to effectively meet the needs of
different groups of customers. It soon evolved into a series of complete business units, each with its own
sales, service, finance, IT, technical support and manufacturing arms. They envisaged that the direct
connection to the customers would enable themto understand the different needs of different customers.
The highlighting features of a SBU are-
a. Profit center b. Objectives are same as parent company
Strategic business units is an individual business unit with its own mission statement and self
sufficient in conducting business
d. (a) and (c) e. (b) and (c)
iPod when released, Apple invested money to maintain growth, distribution and promotion in order to
maintain their product in the high growth rate and high market share category. Wal Mart, with its most
competitive pricing was able to secure the high growth rate and high market share category. Based on
the BCG matrix, the mentioned examples fits into which category of the matrix-
a. Stars b. Cash cows
c. Question marks d. Dogs
e. Shooting stars
DVD players of Sony are cash cows which have secured a hold in the market, but are onthe verge of
replacement of the DVD’s with digital downloads. Sony, needs to manage its products such as the above
mentioned so that they continue to generate revenue to fund star products. In the light of the said
example what are the key features of cash cows based on BCG matrix?
a. Functions in a mature market b. Low potentialfor growth and high market share
c. High investment and high revenues d. (b) and (c)
(a) and (b)
DELL, after recognizing software service as a potent market penetration tool, it is assembling a services
portfolio that now includes email disaster recovery, spam/virus filtering and archiving via its Message
One acquisition. Pakistan State Oil penetrate in Pakistan market from 40% to 65% in the duration of
four years by developing new retail outlets. The said examples, as per Ansoff matrix, falls under
___________category.
Developing new products in existing markets
Increasing the sales and profits for existing products in existing markets
Increasing sales and profits for new products in existing markets
Market development for existing products in new markets
Penetration of new products in new markets
19

Walt Disney diversified from making animated movies to theme parks and vacation properties. Canon
diversified from camera making company into producing whole new range of office equipment. Based
on the examples mentioned above, the fourth quadrant of Ansoff matrix features______________.
Development of new products in the new market
Adopted by companiesifthe current market is saturated due to which revenues and profits are lower.
The prospect ofenteringa promising business outside the scopeofexisting business unit is promising.
(a) , (b) and (c)
(a) and (b)
Nestle Corporation adopted the strategy to acquire good human talent, quality equipment, technology of
the competitors. By integration with other firms, Nestle managed to come up with attractive product
line. Today Nestle exists almost in every part of the world with large market share. Most of integration
in 1980 with Rowntree Mackintosh amounted to euro 2.55billion. This integration helped Nestle to
bring attractive product line in the confectionery market. It also ensured competitive advantage, higher
market share, more profit and long term existence for Nestle. Nestle, while planning for their new
business adopted the strategy of_______________.
a. Intensive growth strategy b. Integrative growth strategy
c. Diversification growth strategy d. (a) and (c)
(b) and (c)
Starbucks partnered with Barnes and Nobles bookstores in 1993 to provide in house coffee shops
benefitting both retailers. Later on, they partnered with The Coffee Connection to bottle,to distribute
and sell the popular coffee based drink, Frappuccino. Starbucks initiated the strategic alliances to gain
advantage in terms of ______.
Work togetherto achieve objectives that are mutually beneficial
Sharing of resources,information, capabilities and risks to attain mutually beneficial objectives
Acquire / buy the other company’s innovations without having to invest in new R&D
(a) and (b)
(b) and (c)
Japanese company, Yamaha, which had struggled to capture 40 percent of the world piano market only to
see global demand for pianos decline by 10 percent a year. The way out of Yamaha’s doldrums was to
be found neither in cost cutting nor in becoming the next Steinway. It was found in player pianos. Given
the shrinking sales figures, the challenge was to bring some value out of the world’s existing 40 million
pianos, many of which were sitting in the living rooms collecting dust. So Yamaha created a digital and
optical technology that would distinguish among 92 degrees of strength and speed of key touch. Identify
the value adding strategy adopted by Yamaha from the following.
Provide value for customers rather than aping customers
Identify the customer needs precisely and create value delivery in the products that specifically
meet those needs
Manufacture the product first, fixing the price and then sell it
(a) and (b)
(a) and (c)
The mission statement of Dow Chemical Company says “ T o constantly improve what is essential to
human progress by mastering science and technology. The mission statement of an organisation, in
order to be effective, needs to have __________ characteristics.
a. Feasibility b. Precise and clear
c. Distinctive d. (a) and (c)
(a) , (b) and (c)
20

UNIT 10: MARKETING AND COMPETITIVE STRATEGIES
The Xerox Corporation started its thrive towards TQM with the invention of PARC, Palo Alto Research
Center, which was created to do research in computer science, electronics, and material science. The
Xerox Corporation focuses on benchmarking, a reduced supplier base and leadership teams as a way of
producing TQM. The strategies that Xerox uses include issuing surveys and developing events for
employees to take part in to further benefit the corporation. The highlighting features of TQM are____.
Continuous process to eliminate defects or mistakes in products or services
Reduction of costs while improving the production process through Six sigma methodology
Training provided to all employees of organization to improvise the business process.
d. (a) and (c) e. (a), (b) and (c)
Ebay and Craigslist are online shopping websites wherein more and more buyers and sellers use the site
and therefore making the website more and, more valuable to customers. This makes it extremely
difficult for new entrants to start something that can compete with these websites and lure customers
away. Based on Porters five forces model that influence competition in an industry, these examples fall
under___________category as per the model.
a. Intensity of rivalry among firms b. Barriers to entry
c. Threat of substitutes d. Bargaining power of buyers
Bargaining power of suppliers
Malaysian Airlines ( MAS)is faced with threat of intense rivalry because various large equally balanced
competitors such as Air Asia, Tiger Airways, Singapore Airlines etc provide almost similar services. As
result MAS is in high rivalry because more firms are competing with same margin segments and
resources. MAS have successfully differentiated their product as full services carrier. Rivalry in slow
industry growth becomes more intense as firms battle to increase their market shares. The main
competitor of MAS being Singapore Airlines, MAS intends to reassess the effectiveness of its route
network both international and domestic by reviewing the viability of the existing fare structure and
routes and also the realigning of its aircraft capacity to markets that offer the greates t opportunities.
Which of the scenarios reflect the intense rivalry among the firms?
When switching costs for customers are low.
Presence of large number of players operating in the industry with almost equal market shares
When there are few large players
d. (a) and (b) e. (a) and ( c)
Wal-Mart is extremely powerful as a buyer. It has enormous reach and thousands of end users. It also
buys in large quantities and controls how a customer accesses the brands and products that it stocks.
This means that WalMart can dictate prices, delivery times and product quality from its suppliers. The
suppliers in turn cater to this pressure by basing their operations close to Wal Mart headquarters and
allowing easy access to the company’s purchase departments to test products and negotiate terms. Wal
Mart can easily switch suppliers which gives the company additional power to dictate terms. In certain
cases Wal Mart can also integrate vertically. Considering the said example, which of the following
circumstances make the bargaining power of WalMart high?
Suppliers industry is dependent on WalMart as a largest buyer for large percentage of total orders.
When WalMart as a buyer can purchase input from several companies at a time economically
WalMart as a buyer can integrate horizontally to provide their own needs and use it as a threat to
force down the prices
d. (a) and (b) e. (a), (b) and (c)
Sear’s as a super store faced a situation of stocks running out and leaving customers with a choice of
either purchasing only what is available and not what they want. With the entry of Wal- Mart, they used
the competitive intelligence system most efficiently and conducted in-depth study of the problems their
competitor Sear’s encountered especially with their distribution system. Based on the information
gathered, Wal-Mart built state-of-the-art distribution system so that their customers were not frustrated
by out- of-stock items, as were Sear’s customers. The highlights of this data collection are ______
21

Information collected by Wal-Mart to bring in a competitive edge to Sears was legal and ethical
means of securing information.
Always collected from customers of Wal-Mart and Sears
Authentic Information collected from annual reports of Sears
d. (b) and (c) e. (a) and (c)
Unilever challenged Procter and Gamble for a long time in the US laundry detergent market, but in the
end chose to follow P&G and focus on profits. Dell faced an indirect attack for identifying a gap and
selling computers directly to customers and attacking IBM. Which of the following strategies is
followed in the above mentioned examples?
a. Market follower, market challenger b. Market follower, market leader
c. Market leader, market follower d. Market leader, market challenger
e. Market follower, market nicher
A South-West airline focuses to provide short haul point –to-point flights in contrast to the hub-and-spoke
model of main stream carriers like Delta. Based on Porter’s Generic competitive strategies, the said
example falls into ___________.
a. Cost leadership strategy b. Differentiation strategy
c. Focus strategy d. Market leadership strategy
e. Product development strategy
Ford pick-up truck competes fiercely with Toyota pick-up truck which in turn competes with Volvo pick-
up truck. Nike, the shoes and sportswear apparel maker competes against Adidas, and Reebok.
Starbucks, the coffee producer and retailer, competes against McDonalds Pacific coffee. This type of
competition is classified into _________category.
a. Generic competition b. Form competition
c. Industry competition d. Brand competition
None of the above
IKEA, the Swedish furniture retailer, revolutionized the furniture industry by offering cheap but stylish
furniture. Ikea is able to keep its prices low by sourcing its products in low wage countries and by
offering a very basic level of service. Ikea does not assemble or deliver furniture, customers must collect
the furniture in the warehouse and assemble at home themselves. While this is less convenient than
traditional retailers, it allows Ikea to offer lower prices that attract customers. Under what circumstances
does Ikea gain cost leadership advantage-
By managing to keep cost of production lower than that of its competitors by managing its
resources efficiently.
By keeping prices low over competitors and introducing technology.
Higher profits due to lower profit margins and higher sales volume
d. (a) and (b) e. (b) and (c)
Earlier, airline travel was considered to be luxury as only a privileged few could afford to travel by air,
while most people preferred travelling by AC trains, which was a lot cheaper. However, with the arrival
of low cost carriers in the market like Deccan, Spice Jet, Indigo, etc, the customers had an option which
was better than travelling by train. Not only were the airlines prices were competitive as compared to the
railway stations, but also reduced the time travel with better facilities for travellers at airport terminals
compared to railway stations. Thus, customers preferred travelling by low cost airlines and this lead to a
decline in the number of premium railway passengers travelling by AC trains. Therefore, innovation in
services is also essential so as to act against threat of substitutes, and retaining market share against
cheaper or better substitutes. Whether a substitute product is really a threat depends upon ________.
Existence of close substitutes which are very similar to each otherbut for a subtle difference
The greater the cost for customers to switch to substitute product,the less the threat there is for
substitution.
People are less likely to switch to an alternative product if they think that if would be difficult to
replicate all of the features of their original product.
d. Buyers propensity to substitutes. e. All of the above
22

UNIT 11: PRODUCT AND PRODUCT LINES
Apple has unveiled two new iPhones, the iPhone 6 at $199 and the iPhone 6 Plus at $299 price. While
both models include the same 64-bit A8 chip and the same general design, there are several differences
between the two phones. The iPhone 6 measures in at 6.9mm, while the iPhone 6 Plus is slightly thicker
at 7.1mm. Apple’s iPhone 6 Plus also has three major differentiating factors: optical image stabilization
for the camera, and a longer battery life, and an iPad-style landscape mode that displays more content
on the screen. Which of the following product personality is represented by the two products iPhone 6
and iPhone 6 Plus?
iPhone 6 as Augemented product and iPhone 6 Plus as Potential product
iPhone 6 as Potential product and iPhone 6 Plus as Potential product
iPhone 6 as Augemented product and iPhone 6 Plus as Augumented product
iPhone 6 as Potential product and iPhone 6 Plus as Augumented product
iPhone 6 as Augemented product and iPhone 6 Plus as Expected product
Doctors prescribe Crocin, a drug commonly used to treat fever and pain. The main chemical in the drug is
Paracetamol. A chemist in a medical shop near All India Institutes Medical Sciences (AIIMS), New
Delhi suggests another drug that has the same chemical Paracetamol with a cheaper price to attract more
AIIMS patients. Once there was news in the press that few of the doctors insisted that patients should
buy prescribed drugs which were expensive, in order to get incentives from pharmaceutical companies.
Customers are happier with the drug suggested by the chemist because it is more affordable and
effective too. Customers also don’t like to be burdened with doctor’s incentives. Which of the following
product personality suits the drug suggested by the chemist?
Expected product since customers want a cheaper product
Augmented product because a chemist added value into the drug
Potential product where the drug has more future potential
Generic product that avoids taxes and advertising expenses
Augumented product because Crocin offers more incentives to doctors
Chandu Tailor & Son Ltd, a London-based Gujarati Family business house,offers a “Golden Charter”
pre-paid funeral plan for clients. It is like an insurance for which the client pays at today’s price the
‘premium’ equalling £2,299 for the basic plan. When the client passes away,Golden Charter pays for
the funeral cost from the accumulated fund. Based on the usage of the product, ‘Golden Charter’ can be
classified as ---------.
Convenience product that makes funeral more convenient
Shopping product where customer spends considerable time and effort before buying funeral plan
Specialty product which is expensive hence planned well before the death
Industrial product which can be preserved for future usage after death
Unsought product which is purchased in the face of uncertainty of death
Box, headquartered in Palo Alto, Calif., has a playful take on seating arrangements as they added swings
to their office. Microsoft employees pull up a seat around the large touch screen tablet table. Facebook
employees can take advantage of a video game room. Google keeps some fun in mind at one of their
offices as employees can literally slide from one floor down to the next with well designed set up. The
seating arrangements, large touch screen tablet table, video game roomand slide fromone floor down to
the next with well designed set up, etc. facilitate more productivity. These types of set up help office
activities for better performance. The facilitating products are called -----------------.
a. Accessory equipment b. Consumable supplies
c. Capital equipment d. Component parts
Process material
23

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