Format:Questions: Italic - Calibri -12Answers: Calibri 11 (No bold)1. Explain waterfall model.2. What would the company have to do to maintain the market share of the new product? 3. Explain product mix with an example of HUL, Pepsi, etc.4. When and how a company makes a decision regarding a line extension or line pruning? 5. What is social marketing? 6. What is social media marketing? 7. Explain mobile marketing. 8. What is marketing mix? Themarketing mixis a business tool used in marketingand bymarketers. Themarketing mix is often crucial when determining a product or brand's offer, and is often associated with the four P's: price, product, promotion, and place.Physical evidenceThe evidence which shows that a service was performed, such as the delivery packaging for the item delivered by a delivery service, or a scar left by a surgeon. This reminds or reassures the consumer that the service took place, positively or negatively.

PeopleThe employees that execute the service, chiefly concerning the manner and skill in which they do so.

ProcessThe processes and systems within the organization that affect the execution of its service, such as job queuing or query handling.

9. Take a new product of your choice and strategize the 4ps for it. 10. Explain product life cycle. 11. Product v/s Service12. Product Management v/s Brand Management13. What is a brand?

a) A brand is a product, service, or concept that is publicly distinguished from other products, services, or concepts so that it can be easily communicated and usually marketed. A brand name is the name of the distinctive product, service, or concept. Branding is the process of creating and disseminating the brand name. Branding can be applied to the entire corporate identity as well as to individual product and service names.

b) Unique design, sign, symbol, words, or a combination of these, employed in creating an image that identifies a product and differentiates it from its competitors. Over time, this image becomes associated with a level of credibility, quality, and satisfaction in the consumer's mind. Thus brands help harried consumers in crowded and complex marketplace, by standing for certain benefits and value. Legal name for a brand is trademark and, when it identifies or represents a firm, it is called a brand name. See also corporate identity.

14. What is brand equity?The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable and superior in quality and reliability. If consumers are willing to pay more for a generic product than for a branded one, however, the brand is said to have negative brand equity. The additional money that consumers are willing to spend to buy Coca Cola rather than the store brand of soda is an example of brand equity

15. How do you measure brand equity?Brand Equity Index (Moran)Marketing executive Bill Moran has derived an index of brand equity as the product of three factors:

Effective Market Share is a weighted average. It represents the sum of a brand's market shares in all segments in which it competes, weighted by each segment's proportion of that brand's total sales.

Relative Price is a ratio. It represents the price of goods sold under a given brand, divided by the average price of comparable goods in the market.

Durability is a measure of customer retention or loyalty. It represents the percentage of a brand's customers who will continue to buy goods under that brand in the following year.

16. Which companies do it? What is the brand equity of TCS?TCS 5 billion brand 4th largest1st IBM-37 billionThe Tata Group has retained its place as the country's most valuable brand at USD 21 billion, while the total worth of top-100 Indian brands now stands at USD 92.6 billion, says a Nielsen study 2014.The brand value of Tata Group has risen by USD 3 billion in the past one year, primarily led by its international diversification strategy and the flagship firm TCS, as per consulting firm Brand Finance India's annual study.

17. What is a strategy?Michael Porter, a strategy expert and professor at Harvard Business School, emphasizes the need for strategy to define and communicate an organization's unique position, and says that it should determine how organizational resources, skills, and competencies should be combined to create competitive advantage.

Long term plan to communicate an organization's unique position and its competencies to create competitive advantage.

18. What are the types of strategy?http://www.smartdraw.com/articles/blog/three-kinds-of-business-strategy.htmThere are at least three basic kinds of strategy with which people must concern themselves in the world of business: (1) just plain strategy or strategy in general, (2) corporate strategy, and (3) competitive strategy.Some Fundamental QuestionsRegardless of the definition of strategy, or the many factors affecting the choice of corporate or competitive strategy, there are some fundamental questions to be asked and answered. These include the following:Related to Mission & Vision Who are we? What do we do? Why are we here? What kind of company are we? What kind of company do we want to become? What kind of company must we become?Related to Strategy in General What is our objective? What are the ends we seek? What is our current strategy, implicit or explicit? What courses of action might lead to the ends we seek? What are the means at our disposal? How are our actions restrained and constrained by the means at our disposal? What risks are involved and which ones are serious enough that we should plan for them?Related to Corporate Strategy What is the current strategy, implicit or explicit? What assumptions have to hold for the current strategy to be viable? What is happening in the larger, social, political, technical and financial environments? What are our growth, size, and profitability goals? In which markets will we compete? In which businesses? In which geographic areas?Related to Competitive Strategy What is the current strategy, implicit or explicit? What assumptions have to hold for the current strategy to be viable? What is happening in the industry, with our competitors, and in general? What are our growth, size, and profitability goals? What products and services will we offer? To what customers or users? How will the selling/buying decisions be made? How will we distribute our products and services? What technologies will we employ? What capabilities and capacities will we require? Which ones are core? What will we make, what will we buy, and what will we acquire through alliance? What are our options? On what basis will we compete?SummaryThe preceding discussion asserts that strategy in general is concerned with how particular objectives are achieved, with courses of action. Corporate strategy is concerned with choices and commitments regarding markets, business and the very nature of the company itself. Competitive strategy is concerned with competitors and the basis of competition.

19. What is marketing? How is it different from Sales?According to KotlerMarketing is a terribly misunderstood subject in business circles and in the publics mind. Companies think that marketing exists to support manufacturing, to get rid of the companys products. The truth is the reverse, that manufacturing exists to support marketing. The company can always outsource its manufacturing. What makes a company is its marketing offerings and ideas. Manufacturing, purchasing, R&D, finance and the other company functions exist to support the companys work in the customer marketplace.

Marketing is too often confused with selling. Selling is only the tip of the marketing iceberg. What is unseen is the extensive market investigation, the research and development of appropriate products, the challenge of pricing them right, of opening up distribution, and of letting the market know about the product. Thus, Marketing is a far more comprehensive process than selling.

Marketing and selling are almost opposites. Hard sell marketing is a contradiction. Long ago I said: Marketing is not the art of finding clever ways to dispose of what you make. Marketing is the art of creating genuine customer value. It is the art of helping your customers become better off. The marketer's watchwords are quality, service, and value.

Selling starts only when you have a product. Marketing starts before there is a product.

Marketing is the homework the company does to figure out what people need and what the company should make. Marketing determines how to launch, price, distribute and promote the product/service offering in the marketplace. Marketing then monitors the results and improves the offering over time. Marketing also decides when to end the offering.

All said, marketing is not a short-term selling effort but a long-term investment effort. When marketing is done well, it occurs before the company makes any product or enters any market; and it continues long after the sale.

Marketing is the science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit. Marketing identifies unfulfilled needs and desires

20. What is Market Capitalization?The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying a company's shares outstanding by the current market price of one share.If a company has 35 million shares outstanding, each with a market value of $100, the company's market capitalization is $3.5 billion (35,000,000 x $100 per share).Tata Consultancy Services (TCS) crossed the Rs 5 lakh crore mark in market capitalization21. What is the importance of a positioning statement? How do you write a positioning statement? Give any 2 examples.Positioning is defined as the act of designing the companys offering and image to occupy a distinctive place in the target markets mind.For Example What brand occurs in your mind when I say walkman? I guess Sony. Similarly what do you think of when I say photocopies? I think Xerox or Cannon. Thus these brands have positioned themselves in the mind of their customer such that whenever the generic product is mentioned immediately these brands come into our mind. Now if I ask most innovative company I guess you will name APPLE : I agree with youA positioning statement is an expression of how a given product, service or brand fills a particular consumer need in a way that its competitors don't. Positioning is the process of identifying an appropriate market niche for a product (or service or brand) and getting it established in that area.22. What do you understand by POD (Points of Differentiation) and POP (Points of parity)?23. Explain different pricing strategies.Pricing is one of the four elements of the marketing mix, along with product, place and promotion. Pricing strategy is important for companies who wish to achieve success by finding the price point where they can maximize sales and profits. Companies may use a variety of pricing strategies, depending on their own unique marketing goals and objectives.Premium PricingPremium pricing strategy establishes a price higher than the competitors. It's a strategy that can be effectively used when there is something unique about the product or when the product is first to market and the business has a distinct competitive advantage. Premium pricing can be a good strategy for companies entering the market with a new market and hoping to maximize revenue during the early stages of the product life cycle.Penetration PricingA penetration pricing strategy is designed to capture market share by entering the market with a low price relative to the competition to attract buyers. The idea is that the business will be able to raise awareness and get people to try the product. Even though penetration pricing may initially create a loss for the company, the hope is that it will help to generate word-of-mouth and create awareness amid a crowded market category.Economy PricingEconomy pricing is a familiar pricing strategy for organizations that include Wal-Mart, whose brand is based on this strategy. Aldi, a food store, is another example of economy pricing strategy. Companies take a very basic, low-cost approach to marketing--nothing fancy, just the bare minimum to keep prices low and attract a specific segment of the market that is very price sensitive.Price SkimmingBusinesses that have a significant competitive advantage can enter the market with a price skimming strategy designed to gain maximum revenue advantage before other competitors begin offering similar products or product alternatives.

Psychological PricingPsychological pricing strategy is commonly used by marketers in the prices they establish for their products. For instance, $99 is psychologically "less" in the minds of consumers than $100. It's a minor distinction that can make a big difference.24. What is a push and pull strategy.Push MarketingPush marketing is a promotional strategy where businesses attempt to take their products to the customers. The term push stems from the idea that marketers are attempting to push their products at consumers. Common sales tactics include trying to sell merchandise directly to customers via company showrooms and negotiating with retailers to sell their products for them, or set up point-of-sale displays. Often, these retailers will receive special sales incentives in exchange for this increased visibility.Example of Push MarketingOne common example of push marketing can be seen in department stores that sell fragrance lines. The manufacturing brand of the fragrance will often offer sales incentives to the department stores for pushing its products onto customers. This tactic can be especially beneficial for new brands that aren't well-established or for new lines within a given brand that need additional promotion. After all, for many consumers, being introduced to the fragrance at the store is their first experience with the product, and they wouldn't know to ask for it if they didn't know it existed.Pull MarketingPull marketing, on the other hand, takes the opposite approach. The goal of pull marketing is to get the customers to come to you, hence the term pull, where marketers are attempting to pull customers in. Common sales tactics used for pull marketing include mass media promotions, word-of-mouth referrals and advertised sales promotions. From a business perspective, pull marketing attempts to create brand loyalty and keep customers coming back, whereas push marketing is more concerned with short-term sales.Example of Pull MarketingYou can often recognize pull marketing campaigns by the amount of advertising that's being used. Pull marketing requires lots of advertising dollars to be spent on making brand and products a household name. One example includes the marketing of children's toys. In the first stage, the company advertises the product. Next, the children and parents see the advertisement and want to purchase the toy. As demand increases, retailers begin scrambling trying to stock the product in their stores. All the while, the company has successfully pulled customers to them.25. What is bucket pricing?Pricing strategy followed by airline industry. Booking tickets as early as possible give customers a seat at low bucket price. As some seats are filled then airline airline starts charging premium price ie high bucket price to customers up to certain level. A day before travelling charges are very high. Each sets of tickets fall in different buckets eg-First 10 tickets- 1000Next 20 ticktes-2000Next 30 tickets-4000So on. 26. What is a pricing tripod? (Cost based, Value based /& Competitor based)The foundations underlying pricing strategy can be described as a tripod, with costs to the provider, competitors pricing, and value to the customer as the three legs. In many service industries, pricing used to be viewed from a finance and accounting standpoint; therefore, cost-plus pricing often was used. Today however, most services have a good understanding of value-based and competitive pricing. In the pricing tripod, the costs a firm needs to recover usually sets a minimum price for a specific service offering, and the customers perceived value of the offering sets a maximum, or ceiling.Cost-Based PricingPricing typically is more complex in services than in manufacturing. Because theres no ownership of services, its usually harder to determine the financial costs of creating a process or intangible real-time performance for a customer than it is to identify the labor, materials, ma-chine time, storage, and shipping costs associated with producing and distributing a physical good. In addition, because of the labor and infrastructure needed to create performances, many service organizations have a much higher ratio of fixed costs to variable costs than is typical in manufacturing firm. Service businesses with high fixed costs include those with ex- pensive physical facilities (such as hospitals or colleges), or a fleet of vehicles (such as airlines or trucking companies), or a network (such as railroads or telecommunications and gas pipeline companies).Value-Based PricingAnother leg of the pricing tripod is value to the customer. No customer will pay more for a service than he or she thinks it is worth. So, marketers need to understand how customers perceive service value in order to set an appropriate price.UNDERSTANDING NET VALUE. When customers purchase a service, they are weighing the perceived benefits of the service against the perceived costs they will incur. Companies sometimes create several tiers of service, recognizing the different tradeoffs that customers are willing to make between these various costs.Value is low price.Value is whatever I want in a product.Value is the quality I get for the price I pay.Value is what I get for what I give.8

If the perceived costs of a service are greater than the perceived benefit then the service in question will possess negative net value, and the consumer will not buy. You can think of calculations customers make in their minds as similar to weighing materials on a pair of old-fashioned scales, with product benefit in one tray and the costs associated with obtaining those benefit in the other tray. When customers evaluate competing services, they are basically comparing the relative net values .A marketer can increase the value of a service by adding benefit to the core product and by improving supplementary services.Competition-based PricingThe last leg of the pricing tripod is competition. Firms with relatively undifferentiated services need to monitor what competitors are charging and should to try to price accordingly. When customers see little or no difference between competing offerings, they may just choose what they perceive to be the cheapest. In such a situation, the firm with the lowest cost per unit of service enjoys an enviable market advantage and often assumes price leadership. Here, one firm acts as the price leader, with others taking their cue from this company. You can sometimes see this phenomenon at the local level when several gas stations compete within a short distance of one another. As soon as one station raises or lowers its prices, the others follow suit.Price competition intensifies with (1) an increasing number of competitors, (2) an in- creasing number of substituting offers, (3) a wider distribution of competitor and/or substitution offers, and (4) an increasing surplus capacity in the industry

27. B2B v/s B2CWhile there are many similarities between B2C and B2B marketing in general, there are some key differences, especially on social media.1. Marketers can use industry jargon to excellent effect on B2B platforms, but on B2C, the voice must be at least relatable to the majority of consumers meaning fewer buzzwords and (usually) simpler language.2. Drivers matter. The B2B audience is seeking efficiency and expertise, while the consumer audience is more likely to be seeking deals and entertainment. Accordingly, the B2B purchase process tends to be rationally and logically driven, while consumer choices are typically emotionally triggered (whether by hunger, desire, status or cost).3. B2B clientele want to be educated and provided with expertise. They often want to look like the workplace rock stars or heroes thanks to their excellent decisions. B2C customers just want to enjoy themselves, be happy with their purchase and have it adequately fulfill the needs mentioned in No. 2.4. Highly detailed content is required for B2B marketing. Its an audience that expects to be catered to by a sales and marketing team. On the other hand, B2C social media activities simply need to meet the basic needs of being useful, humorous and shareable, which admittedly, can be just as complicated.5. Lengthy content tends to work for B2B since a brand or business has to prove its expertise and give its target audience a reason to buy in. Consumers tend to prefer something short and snappy, especially for lower-priced B2C products.6. A B2C consumer following your brand isnt necessarily looking to build a close relationship with it. Inversely, the B2B crowd wants information and the ability to build a close relationship with brands.7. B2B marketers have a much longer chain of command to deal with since procurement, accounting and their superiors often need to approve purchases. On the other hand, an individual typically makes their own speedy B2C purchase choices possibly with the slight influence of others via recommendations or suggestions.8. The B2B buying cycle is often much longer than the B2C decision process. Therefore, it requires much more nurturing and close attention. B2C buys tend to satisfy immediate needs, while B2B decisions are meant to complete long-term goals.9. A contract for a B2B purchase tends to last months or even years, making it a much more significant decision. On the contrary, the total B2C cycle can be as short as a few minutes depending on the product.10. The two types of marketers have distinctive problems. Often, the largest problem that B2B marketers have is a lack of content and time to create it. This differs from B2C marketers who would rather have a bigger advertising budget and other ways to spread the word about their products. Naturally, this has a significant effect on tactical executions.28. 29. What is brand recall? How is it measured?Aqualitativemeasureof how well abrand nameis connected with aproduct typeorclassofproductsbyconsumers.

Brand recognition means the customer is shown the brand and is asked to recognize provided he is already aware or has a prior exposure to that particular brand whereas Brand recall refers to giving a product category to the customer and asking him to recall the brand name for that particular product category...example: Showing the logo of pepsi to customer and asking to recognize is brand recognition and giving the category of soft drinks and asking him to recall the brands is brand recall.30. What are your favorite concepts in marketing? ( STPD and SWOT)

31. What are segmentation, its classification and examples to support them? (I read Kotler so most of the answers and examples were from the book only)

32. Situational Question: - If one wants to come in Soap domain how one must segment the market? Same for mobile industry too?

33. Company life cycle of Nokia. (From competitive dynamics chapter in Kotler one will find all the types of PLC). 34. What is cross selling, up-selling and down selling?Although companies often look for ways to sell pricier goods, offering the customer low-end products and services can be more profitable and the best way to build a customer base. However, you also have to cater your sales strategy to your industry. Sometimes, anything less than high-cost products can hurt your business.IdentificationUp-selling is a marketing technique where you try to convince a customer to purchase a more expensive product. For example, if a customer looks to purchase an entry-level laptop computer, you could attempt an up-sell by informing him of the upgrades of a mid-range or premium laptop. A down-sell involves a reversal of the up-sell. If a customer does not want the product you want to sell, you suggest a cheaper alternative. For instance, when a customer cannot afford a laptop, you might suggest an older model desktop that costs less.BenefitsAlthough your higher-priced items may have a larger profit margin, down-selling can be just as or more important to your company. Entry-level products can help you build brand loyalty when a customer cannot afford premium products at the moment. For example, one boutique that sells purses found that sales were dropping because customers could not afford the item. Instead of slashing prices and potentially diluting the market with their product, the boutique designed a cellphone holder with a similar design as their purses but at a fraction of the price of their handbags.Cross-SellingRelated to up-selling and down-selling is "cross-selling." Using the cross-selling technique, you offer related products and services to the initial purchase. Warranties are a common cross-selling technique. If someone buys a computer for $300, for example, you might offer a warranty to replace the computer in case it breaks for $100. Cross-selling also builds brand loyalty.

Cross-sellingFor a given product or combination of products, you can specify that additional products are to be suggested for purchase.ExampleIf a business partner orders a PC, you can cross-sell by suggesting that they also buy a printer or a particular software package.Up-sellingYou can define other products that should be proposed if you sell a specific product.ExampleIf a business partner orders a fax machine, youup-sellby proposing a more expensive, better-equipped version.Down-sellingUnder certain circumstances, you may want to suggest a cheaper product as an alternative (down-selling).ExampleA telesales agent is able to view both more expensive (up-selling) and cheaper (down-selling) alternatives (depending on Customizing settings). As a rule, the agent will generally try to promote up-selling products to the customer, but to prevent a no-sale he or she may also be forced to propose down-selling alternatives instead. If you create up-selling and down-selling rules that are target-group-specific, you can control for which business partners you generally want to perform up-selling, and for which down-selling.

35. What are the different types of advertisement? (All concepts were asked like AIDA, Hierarchy of effects model, tools of marketing mix and 5Ms) AIDA-- is anacronymused inmarketingandadvertisingthat describes a common list of events that may occur when a consumer engages with an advertisement. A attention (Awareness): attract the attention of the customer. I interest: raise customer interest by focusing on and demonstrating advantages and benefits (instead of focusing on features, as in traditional advertising). D desire: convince customers that they want and desire the product or service and that it will satisfy their needs. A action: lead customers towards taking action and/or purchasing.

4 Asof Marketing:AcceptabilityAffordabilityAvailabilityAwarenessMarketing Mix and the Five Ms of MarketingWritten by Clayton Reeves for Gaebler VenturesWhen you produce a marketing strategy, there is a mix that must be created. This involves the five Ms of marketing and how they convince buyers to purchase your items.Marketing has many different interactive parts.(article continues below)Among them is the communication aspect.The five Ms of advertising provide a framework by which you can create an advertising platform.First, the firm must decide what the purpose of the advertisements will be. This is called the mission. Monetary constraints usually determine how large any project can be. This is the money aspect of the advertising project. Message is the creative aspect of the advertising strategy. Next, the media by which the message will be delivered must be determined. Finally, measuring the project is important to determine how effective the advertisements actually were. This can sometimes be the most difficult part of the plan, since measuring changes in customer opinion can be time consuming and costly.In this article, we take a deeper look at the five Ms of marketing.MissionThere are several ways that a company can determine what the mission of an advertising strategy should be. Quantitative measures such as increasing the awareness of the brand among a certain segment by a certain percentage can be chosen. For example, increasing the awareness among financial executives of a certain audit control offered by your company by 20% could be a mission. This could be measured before and after using a survey or some other form of primary research.MoneyBudget constraints are everywhere in business, and nowhere are they more evident than in small businesses. Advertising and marketing can sometimes be ignored because they do not offer immediate results. However, in every business environment, some resources must be allocated to building a brand and image. Without this, the company will not continue to grow. Even during recessions, marketing must be a priority to avoid losing market share. Having a suitable budget is an important part of the process.MessageAdvertising is a creative process. There are slogans, themes and gimmicks that try to lure the customer in. The message of an advertisement is this creative aspect. Any manner of theme can be implemented as long as it is in line with what the company stands for.MediaThis aspect of the program refers to the media that will be used to communicate the message. This can include television, radio, mail, telephone and in person contact. Most media has metrics to measure their efficiency and costs associated with those metrics. Choosing the right media can make or break an advertising program.MeasurementFinally, the firm must measure the effects of the program on their intended audience. This can be done by measuring sales or trying to gauge interest through research. It is often very difficult to measure how much the advertisements actually impacted customer interest and how much other external factors played a part.When he's not playing racquetball or studying for a class, Clayton Reeves enjoys writing articles about entrepreneurship. He is currently an MBA student at the University of Missouri with a concentration in Economics and Finance.

36. Situational Question: - What kind of advertisement one should do when new brand is introducing new product and existing brand introducing new product?

37. Sales Promotion

38. Consumer Behavior

39. Market research

40. What PODs (points-of difference) should Whatsapp / Amazon develop to combat competition and protect market share? Explain why?

41. What is IT Service? What is Business Solution? What is the difference between the two? 42. Can you state an instance where your ego has come in way of you playing a team role? 43. So that means you have no ego? So what about self-respect? Do you not have that too? 44. If you face such a scenario where in the team you are a part of has to do something that is completely against your values and will crush your self-respect, what will you do? 45. Would you let your team members go ahead with it and keep yourself out of it, to keep-safe your self-respect or would you not mind losing your self-respect? 46. Explain law of diffusion. .Rogers proposes that four main elements influence the spread of a new idea: the innovation itself, communication channels, time, and a social system. This process relies heavily onhuman capital. The innovation must be widely adopted in order to self-sustain. Within the rate of adoption, there is a point at which an innovation reachescritical mass. The categories of adopters are: innovators,early adopters, early majority, late majority, and laggards.[2]Diffusion manifests itself in different ways in various cultures and fields and is highly subject to the type of adopters and innovation-decision process.

47. Explain different types of Consumer Attitudes? (Cognitive/affective/ behavioral) Cognitive: This represents our thoughts, beliefs and ideas about something. Typically these come to light in generalities or stereotypes, such as 'all teenagers are lazy,' or 'all babies are cute.'

Affective: This component deals with feelings or emotions that are brought to the surface about something, such as fear or hate. Using our above example, someone might have the attitude that they hate teenagers because they are lazy or that they love all babies because they are cute.

Conative or Behavioral: This can also be called the behavioral component and centers on individuals acting a certain way towards something, such as 'we better keep those lazy teenagers out of the library,' or 'I cannot wait to kiss that baby.'

48. Explain Maslows hierarchy?

49. Father of marketing. (Peter Drucker)50. Father of rural marketing. (Pradeep Kashyab)51. IMC& types?Integrated marketing communication refers to integrating all the methods of brand promotion to promote a particular product or service among target customers. In integrated marketing communication, all aspects of marketing communication work together for increased sales and maximum cost effectiveness.It is essential for organizations to promote their brands well among the end-users not only to outshine competitors but also survive in the long run. Brand promotion increases awareness of products and services and eventually increases their sales, yielding high profits and revenue for the organization.To understand integrated marketing communication, let us first understand what does brand communication mean?Brand communication is an initiative taken by organizations to make their products and services popular among the end-users. Brand communication goes a long way in promoting products and services among target consumers. The process involves identifying individuals who are best suited to the purchase of products or services (also called target consumers) and promoting the brand among them through any one of the following means: Advertising Sales Promotion Public Relation Direct Marketing Personal Selling Social media, and so on52. What is Marketing Plan?

53. What is positioning?There are four elements or components of a positioning statement:1. Target Audience- the attitudinal and demographic description of the core prospect to whom the brand is intended to appeal; the group of customers that most closely represents the brands most fervent users.2. Frame of Reference- the category in which the brand competes; the context that gives the brand relevance to the customer.3. Benefit/Point of Difference- the most compelling and motivating benefit that the brand can own in the hearts and minds of its target audiencerelativeto the competition.4. Reason to Believe- the most convincing proof that the brand delivers what it promises.Template for a Positioning Statement:For(target audience),(brand name)is the(frame of reference)that delivers(benefit/point of difference)because only(brand name)isreason to believe).

54. Rule of 3 and their Strategies?Therule of threein Business and Economics is arule of thumbsuggesting that there are always three major competitors in any free market within any one industry.Leader , challenger and follower.55. Pricing Strategies?Pricing is one of the four elements of the marketing mix, along with product, place and promotion. Pricing strategy is important for companies who wish to achieve success by finding the price point where they can maximize sales and profits. Companies may use a variety of pricing strategies, depending on their own unique marketing goals and objectives.Ads by Google$0.01 Web HostingScalable, Secure Web Hosting. Try Our Award-Winning Service Now!www.hostgator.com/1PennyPremium PricingPremium pricing strategy establishes a price higher than the competitors. It's a strategy that can be effectively used when there is something unique about the product or when the product is first to market and the business has a distinct competitive advantage. Premium pricing can be a good strategy for companies entering the market with a new market and hoping to maximize revenue during the early stages of the product life cycle.Penetration PricingA penetration pricing strategy is designed to capture market share by entering the market with a low price relative to the competition to attract buyers. The idea is that the business will be able to raise awareness and get people to try the product. Even though penetration pricing may initially create a loss for the company, the hope is that it will help to generate word-of-mouth and create awareness amid a crowded market category.Related Reading:Pricing Vs. Nonpricing StrategiesEconomy PricingEconomy pricing is a familiar pricing strategy for organizations that include Wal-Mart, whose brand is based on this strategy. Aldi, a food store, is another example of economy pricing strategy. Companies take a very basic, low-cost approach to marketing--nothing fancy, just the bare minimum to keep prices low and attract a specific segment of the market that is very price sensitive.Price SkimmingBusinesses that have a significant competitive advantage can enter the market with a price skimming strategy designed to gain maximum revenue advantage before other competitors begin offering similar products or product alternatives.Psychological PricingPsychological pricing strategy is commonly used by marketers in the prices they establish for their products. For instance, $99 is psychologically "less" in the minds of consumers than $100. It's a minor distinction that can make a big difference.

56. Cause- Related marketing?Cause Related Marketing is a commercial activity by which businesses and charities (or causes) form a partnership with each other to market an image, product or service for mutual benefit. It is a marketing tool used to help address the social issues of the day, through providing resources and funding, whilst at the same time addressing important business objectives.57. Surrogate advertising/marketing?Surrogate Advertisingis a form ofadvertisingwhich is used to promotebannedproducts likecigarettesandalcohol, in the disguise of another product. This type of advertising uses a product of a fairly close category, as:club soda,mineral waterin case of alcohol, or products of a completely different category, for examplemusic CD'sorplaying cardsto hammer thebrand nameinto the heads of consumers. The banned product (alcohol or cigarettes) may not be projected directly to consumers but rather masked under another product under the same brand name, so that whenever there is mention of that brand, people start associating it with its main product (the alcohol or cigarette). InIndiathere is a large number of companies doing surrogate advertising, fromBacardiBlast music CD's, Bagpiper Club Soda to Officers Choice playing cards.The masking product i.e. the music CD's, or mineral water might not even be marketed in real, it is just a strategy used to generate top of the mindrecall.58. Integrated & Interactive Marketing?What is integrated marketing?Integrated marketing is the act of incorporating your marketing messages throughout all of your marketing vehicles for the company or a specific product or service line so that the message is clear and consistent. For example, a tool manufacturer may want to use specific marketing messages, tactics and vehicles for the purposes of promoting its corporate identity whereas it may use different messages, tactics and vehicles for promoting specific tools. The tool manufacturer will want to ensure that the messaging designed for a specific tool line is consistent across the different vehicles such as trade shows, product information, commercials and even customer support.What is interactive marketing?Interactive marketing is when the marketing messages and campaigns allow recipients to be actively involved in the campaign and possibly even, the results. Given todays markets and digitally engaged consumers, interactive marketing is something as consumers we do without even thinking about it. For example, if you have a smart phone, you may have scanned aQR Code(Quick Response Code) off the side of a bus, in the airport or even off the back of a business card. Scanning the code allows you to be immediately interactive with the companys marketing and gives the company real-time feed back about you the consumer.One of the biggest benefits of interactive marketing for companies is the collection of data. Data collection and analysis helps companies, schools and governments, learn more about their customers, students and constituents. One of the biggest benefits of interactive marketing for users is the immediate access to information, knowledge and services.

59. Inbound/Outbound, Reverse, relationship, Permission, Affiliate, Guerrilla, Umbrella, Ambush, Online/Offline Marketing?

60. Horizontal/ Vertical Integration?Inmicroeconomicsandmanagement,vertical integrationis where thesupply chainof a company is owned by that company. Usually each member of the supply chain produces a differentproductor (market-specific) service, and the products combine to satisfy a common need. It is contrasted withhorizontal integration. Vertical integration has also described management styles that bring large portions of the supply chain not only under a common ownership, but also into one corporation (as in the 1920s when theFord River Rouge Complexbegan making much of its own steel rather than buying it from suppliers).Vertical integration is one method of avoiding thehold-up problem. A monopoly produced through vertical integration is called avertical monopoly.Three types[edit]Vertical integration is the degree to which a firm owns its upstream suppliers and its downstream buyers. Contrary tohorizontal integration, which is a consolidation of many firms that handle the same part of the production process, vertical integration is typified by one firm engaged in different parts of production (e.g., growing raw materials, manufacturing, transporting, marketing, and/orretailing).There are three varieties: backward (upstream) vertical integration, forward (downstream) vertical integration, and balanced (both upstream and downstream) vertical integration. A company exhibitsbackward vertical integrationwhen it controlssubsidiariesthat produce some of the inputs used in the production of its products. For example, an automobile company may own atirecompany, aglasscompany, and a metal company. Control of these three subsidiaries is intended to create a stable supply of inputs and ensure a consistent quality in their final product. It was the main business approach ofFordand other car companies in the 1920s, who sought to minimize costs by integrating the production of cars and car parts as exemplified in theFord River Rouge Complex. A company tends towardforward vertical integrationwhen it controls distribution centers and retailers where its products are sold.Examples[edit]One of the earliest, largest and most famous examples of vertical integration was theCarnegie Steelcompany. The company controlled not only the mills where thesteelwas made, but also the mines where theiron orewas extracted, the coal mines that supplied thecoal, the ships that transported the iron ore and the railroads that transported the coal to the factory, thecokeovens where the coal was cooked, etc. The company also focused heavily on developing talent internally from the bottom up, rather than importing it from other companies.[2]Later on, Carnegie even establishedan instituteof higher learning to teach the steel processes to the next generation.Oil industry[edit]Oil companies, both multinational (such asExxonMobil,Royal Dutch Shell,ConocoPhillipsorBP) and national (e.g.Petronas) often adopt a vertically integrated structure. This means that they are active along the entire supply chain fromlocating deposits, drilling and extractingcrude oil, transporting it around the world,refiningit into petroleum products such aspetrol/gasoline, to distributing the fuel to company-owned retail stations, for sale to consumers.Inbusiness,horizontal integrationis a strategy where acompanycreates or acquiresproductionunits for outputs which are alike - either complementary or competitive. One example would be when a company acquires competitors in the same industry doing the same stage of production for the creation of amonopoly.[1]Another example is the management of a group of products which are alike, yet at different price points, complexities, and qualities. This strategy may reducecompetitionand increasemarket shareby usingeconomies of scale. For example, a car manufacturer acquiring its competitor who does exactly the same thing.Horizontal integrationis the opposite tovertical integration, where companies integrate multiple stages of production of a small number of production units.

61. Organic/ Inorganic Growth strategies?

62. Blue Ocean Strategy?63. Types of sales?64. Sales process- 7 steps or Stages is Selling65. ATL, BTL activities?66. What is Demarketing?Efforts aimed at discouraging (not destroying) thedemandfor aproductwhich (1) a firm cannotsupplyin large-enoughquantities, or (2) does notwantto supply in a certainregionwhere thehighcostsofdistributionorpromotionallow only a too littleprofit margin.Commondemarketingstrategiesinclude higherprices, scaled-downadvertising, and product redesign.67. 7 S?TheMcKinsey 7S Frameworkis amanagementmodel developed by well-known business consultantsRobert H. Waterman, Jr.andTom Peters(who also developed the MBWA-- "Management By Walking Around" motif, and authoredIn Search of Excellence) in the 1980s. This was a strategic vision for groups, to includebusinesses,business units, and teams. The 7S are structure, strategy, systems, skills, style, staff and shared values.The model is most often used as anorganizational analysistool to assess and monitor changes in the internal situation of an organization.The model is based on the theory that, for an organization to perform well, these seven elements need to be aligned and mutually reinforcing. So, the model can be used to help identify what needs to be realigned to improve performance, or to maintain alignment (and performance) during other types of change.Whatever the type of change restructuring, new processes, organizational merger, new systems, change of leadership, and so on the model can be used to understand how the organizational elements are interrelated, and so ensure that the wider impact of changes made in one area is taken into consideration.

68. 7 C?here are7 Cs of effective communicationwhich are applicable to both written as well as oral communication. These are as follows:1. Completeness -The communication must be complete. It should convey all facts required by the audience. The sender of the message must take into consideration the receivers mind set and convey the message accordingly. A complete communication has following features: Complete communication develops and enhances reputation of an organization. Moreover, they are cost saving as no crucial information is missing and no additional cost is incurred in conveying extra message if the communication is complete. A complete communication always gives additional information wherever required. It leaves no questions in the mind of receiver. Complete communication helps in better decision-making by the audience/readers/receivers of message as they get all desired and crucial information. It persuades the audience.

2. Conciseness -Conciseness means wordiness, i.e, communicating what you want to convey in least possible words without forgoing the other Cs of communication. Conciseness is a necessity for effective communication. Concise communication has following features: It is both time-saving as well as cost-saving. It underlines and highlights the main message as it avoids using excessive and needless words. Concise communication provides short and essential message in limited words to the audience. Concise message is more appealing and comprehensible to the audience. Concise message is non-repetitive in nature.3. Consideration -Consideration implies stepping into the shoes of others. Effective communication must take the audience into consideration, i.e, the audiences view points, background, mind-set, education level, etc. Make an attempt to envisage your audience, their requirements, emotions as well as problems. Ensure that the self-respect of the audience is maintained and their emotions are not at harm. Modify your words in message to suit the audiences needs while making your message complete. Features of considerate communication are as follows: Emphasize on you approach. Empathize with the audience and exhibit interest in the audience. This will stimulate a positive reaction from the audience. Show optimism towards your audience. Emphasize on what is possible rather than what is impossible. Lay stress on positive words such as jovial, committed, thanks, warm, healthy, help, etc.4. Clarity -Clarity implies emphasizing on a specific message or goal at a time, rather than trying to achieve too much at once. Clarity in communication has following features: It makes understanding easier. Complete clarity of thoughts and ideas enhances the meaning of message. Clear message makes use of exact, appropriate and concrete words.5. Concreteness -Concrete communication implies being particular and clear rather than fuzzy and general. Concreteness strengthens the confidence. Concrete message has following features: It is supported with specific facts and figures. It makes use of words that are clear and that build the reputation. Concrete messages are not misinterpreted.6. Courtesy -Courtesy in message implies the message should show the senders expression as well as should respect the receiver. The sender of the message should be sincerely polite, judicious, reflective and enthusiastic. Courteous message has following features: Courtesy implies taking into consideration both viewpoints as well as feelings of the receiver of the message. Courteous message is positive and focused at the audience. It makes use of terms showing respect for the receiver of message. It is not at all biased.7. Correctness -Correctness in communication implies that there are no grammatical errors in communication. Correct communication has following features: The message is exact, correct and well-timed. If the communication is correct, it boosts up the confidence level. Correct message has greater impact on the audience/ readers. It checks for the precision and accurateness of facts and figures used in the message. It makes use of appropriate and correct language in the message.Awareness of these 7 Cs of communication makes you an effective communicator.69. Difference between Direct marketing & Sales Promotion?70. Stages of Buying Decision Process?

71. Explain - Pure monopoly, Oligopoly, Monopolistic competition, Pure Competition?

72. What are the advantages/disadvantages of celebrity endorsement? How would you choose any celebrity for the company? (Asked in Asian Paints)

73. Explain BCG matrix in brief. Draw a BCG matrix for any category of your choice. Justify the placement of each unit in the matrix. OrWhat is the significance of each quadrant of BCG and what decisions have to be taken with respect to each quadrant? OrFor a company, how many stars, dogs, cash cows and question marks are preferred? OrWhen a product is launched, in which quadrant of the BCG will it fall in? [My answer was that it depends on the industry growth rate] OrGive us examples of both cases, new product in high growth rate industry and new product in low growth rate industry, which quadrants would the new product fall in? Or[I gave the example of Whatsapp- new product in high growth market, qualifies as a Star. Following questions i.e. 11 to 14 were based on this example. My answer to each question led to the next question] OrSo if the new product is a Star today, what would it become after some time? OrIn the BCG, how will you maintain your Cash Cows as Cash Cows? OrHow will you maintain or further increase market share? There is no condition where there would be no competition. How can you protect yourself from competition? OrCan a Dog ever be converted into a Question Mark or Cash Cow? If yes, how? Cite example(s). [Given that industry growth rate picks up] OrYour answer seems hypothetical. It may work. But what do you really feel? Can a Dog be really converted into a Cash Cow or Question Mark ever?Definition1. BCG matrix(or growth-share matrix) is a corporate planning tool, which is used to portray firms brand portfolio or SBUs on a quadrant along relative market share axis (horizontal axis) and speed of market growth (vertical axis) axis.2. Growth-share matrixis a business tool, which uses relative market share and industry growth rate factors to evaluate the potential of business brand portfolio and suggest further investment strategies.Understanding the toolBCG matrix is a framework created by Boston Consulting Group to evaluate the strategic position of the business brand portfolio and its potential. It classifies business portfolio into four categories based on industry attractiveness (growth rate of that industry) andcompetitive position(relative market share). These two dimensions reveal likely profitability of the business portfolio in terms of cash needed to support that unit and cash generated by it. Thegeneral purposeof the analysis is to help understand, which brands the firmshould invest inand which onesshould be divested.

Relative market share.One of the dimensions used to evaluate business portfolio is relative market share. Higher corporates market share results in higher cash returns. This is because a firm that produces more, benefits from higher economies of scale and experience curve, which results in higher profits. Nonetheless, it is worth to note that some firms may experience the same benefits with lower production outputs and lower market share.Market growth rate.High market growth rate means higher earnings and sometimes profits but it also consumes lots of cash, which is used as investment to stimulate further growth. Therefore, business units that operate in rapid growth industries are cash users and are worth investing in only when they are expected to grow or maintain market share in the future.There are four quadrants into which firms brands are classified:Dogs.Dogs hold low market share compared to competitors and operate in a slowly growing market. In general, they are not worth investing in because they generate low or negative cash returns. But this is not always the truth. Some dogs may be profitable for long period of time, they may provide synergies for other brands or SBUs or simple act as a defense to counter competitors moves. Therefore, it is always important to perform deeper analysis of each brand or SBU to make sure they are not worth investing in or have to be divested.Strategic choices: Retrenchment, divestiture, liquidationCash cows.Cash cows are the most profitable brands and should be milked to provide as much cash as possible. The cash gained from cows should be invested into stars to support their further growth. According to growth-share matrix, corporates should not invest into cash cows to induce growth but only to support them so they can maintain their current market share. Again, this is not always the truth. Cash cows are usually large corporations or SBUs that are capable of innovating new products or processes, which may become new stars. If there would be no support for cash cows, they would not be capable of such innovations.Strategic choices: Product development, diversification, divestiture, retrenchmentStars.Stars operate in high growth industries and maintain high market share. Stars are both cash generators and cash users. They are the primary units in which the company should invest its money, because stars are expected to become cash cows and generate positive cash flows. Yet, not all stars become cash flows. This is especially true in rapidly changing industries, where new innovative products can soon be outcompeted by new technological advancements, so a star instead of becoming a cash cow, becomes a dog.Strategic choices: Vertical integration, horizontal integration, market penetration, market development, product developmentQuestion marks.Question marks are the brands that require much closer consideration. They hold low market share in fast growing markets consuming large amount of cash and incurring losses. It has potential to gain market share and become a star, which would later become cash cow. Question marks do not always succeed and even after large amount of investments they struggle to gain market share and eventually become dogs. Therefore, they require very close consideration to decide if they are worth investing in or not.Strategic choices: Market penetration, market development, product development, divestitureBCG matrix quadrants are simplified versions of the reality and cannot be applied blindly. They can help as general investment guidelines but should not change strategic thinking. Business should rely on management judgement, business unitstrengths and weaknessesandexternal environment factorsto make more reasonable investment decisions.

Advantages and disadvantagesBenefits of the matrix: Easy to perform; Helps to understand the strategic positions of business portfolio; Its a good starting point for further more thorough analysis.Growth-share analysis has been heavily criticized for its oversimplification and lack of useful application. Following are the main limitations of the analysis: Business can only be classified to four quadrants. It can be confusing to classify an SBU that falls right in the middle. It does not define what market is. Businesses can be classified as cash cows, while they are actually dogs, or vice versa. Does not include other external factors that may change the situation completely. Market share and industry growth are not the only factors of profitability. Besides, high market share does not necessarily mean high profits. It denies that synergies between different units exist. Dogs can be as important as cash cows to businesses if it helps to achieve competitive advantage for the rest of the company.Using the toolAlthough BCG analysis has lost its importance due to many limitations, it can still be a useful tool if performed by following these steps: Step 1. Choose the unit Step 2. Define the market Step 3. Calculate relative market share Step 4. Find out market growth rate Step 5. Draw the circles on a matrixStep 1. Choose the unit.BCG matrix can be used to analyze SBUs, separate brands, products or a firm as a unit itself. Which unit will be chosen will have an impact on the whole analysis. Therefore, it is essential to define the unit for which youll do the analysis.Step 2. Define the market.Defining the market is one of the most important things to do in this analysis. This is because incorrectly defined market may lead to poor classification. For example, if we would do the analysis for the Daimlers Mercedes-Benz car brand in the passenger vehicle market it would end up as a dog (it holds less than 20% relative market share), but it would be a cash cow in the luxury car market. It is important to clearly define the market to better understand firms portfolio position.Step 3. Calculate relative market share.Relative market share can be calculated in terms of revenues or market share. It is calculated by dividing your own brands market share (revenues) by the market share (or revenues) of your largest competitor in that industry. For example, if your competitors market share in refrigerators industry was 25% and your firms brand market share was 10% in the same year, your relative market share would be only 0.4. Relative market share is given on x-axis. Its top left corner is set at 1, midpoint at 0.5 and top right corner at 0 (see the example below for this).

Step 4. Find out market growth rate.The industry growth rate can be found in industry reports, which are usually available online for free. It can also be calculated by looking at average revenue growth of the leading industry firms. Market growth rate is measured in percentage terms. The midpoint of the y-axis is usually set at 10% growth rate, but this can vary. Some industries grow for years but at average rate of 1 or 2% per year. Therefore, when doing the analysis you should find out what growth rate is seen as significant (midpoint) to separate cash cows from stars and question marks from dogs.Step 5. Draw the circles on a matrix.After calculating all the measures, you should be able to plot your brands on the matrix. You should do this by drawing a circle for each brand. The size of the circle should correspond to the proportion of business revenue generated by that brand.ExamplesCorporate A BCG matrixBrandRevenues% of corporate revenuesLargest rivals market shareYour brands market shareRelative market shareMarket growth rate

"1"$500,00054%25%25%13%

"2"$350,00038%30%5%0.1712%

"3"$50,0006%45%30%0.6713%

"4"$20,0002%10%1%0.115%

This example was created to show how to deal with a relative market share higher than 100% and with negative market growth.Corporate B BCG matrixBrandRevenues% of corporate revenuesLargest rivals market shareYour brands market shareRelative market shareMarket growth rate

"1"$500,00055%15%60%13%

"2"$350,00031%30%5%0.17-15%

"3"$50,00010%45%30%0.67-4%

"4"$20,0004%10%1%0.18%

74. Strategic ToolsValue Chain, Porters Generic Strategies, Porters 5 forces, PESTEL, SWOT, STPD, Ansoff , GE Matrix, Marketing MIX, PLC POLITICAL ECONOMIC SOCIAL TECHNOLOGICAL ENVIRONMENTAL LEGAL

VALUE CHAIN ANALYSIS:1. Value chain analysis(VCA) is a process where a firm identifies its primary and support activities that add value to its final product and then analyze these activities to reduce costs or increase differentiation.2. Value chainrepresents the internal activities a firm engages in when transforming inputs into outputs.Understanding the toolVCA is a strategy tool used to analyze internal firm activities. Its goal is to recognize, which activities are the most valuable (i.e. are the source of cost or differentiation advantage) to the firm and which ones could be improved to providecompetitive advantage. In other words, by looking into internal activities, the analysis reveals where a firms competitive advantages or disadvantages are. The firm that competes through differentiation advantage will try to perform its activities better than competitors would do. If it competes through cost advantage, it will try to perform internal activities at lower costs than competitors would do. When a company is capable of producing goods at lower costs than the market price or to provide superior products, it earns profits.M. Porter introduced the generic value chain model in 1985. Value chain represents all the internal activities a firm engages in to produce goods and services. VC is formed ofprimary activitiesthat add value to the final product directly andsupport activitiesthat add value indirectly. Below you can see the Porters VC model.Primary Activities

Support Activities

Although, primary activities add value directly to the production process, they are not necessarily more important than support activities. Nowadays, competitive advantage mainly derives from technological improvements or innovations in business models or processes. Therefore, such support activities as information systems, R&D or general management are usually the most important source of differentiation advantage. On the other hand, primary activities are usually the source of cost advantage, where costs can be easily identified for each activity and properly managed.Firms VC is a part of a larger industry VC. The more activities a company undertakes compared to industry VC, the morevertically integratedit is. Below you can find an industry value chain and its relation to a firm level VC.

Using the toolThere are two different approaches on how to perform the analysis, which depend on what type ofcompetitive advantagea company wants to create (cost or differentiation advantage). The table below lists all the steps needed to achieve cost or differentiation advantage using VCA.Cost advantageDifferentiation advantage

This approach is used when organizations try to compete on costs and want to understand the sources of their cost advantage or disadvantage and what factors drive those costs.The firms that strive to create superior products or services use differentiation advantage approach.

Step 1.Identify the firms primary and support activities. Step 2.Establish the relative importance of each activity in the total cost of the product. Step 3.Identify cost drivers for each activity. Step 4.Identify links between activities. Step 5.Identify opportunities for reducing costs. Step 1.Identify the customers value-creating activities. Step 2.Evaluate the differentiation strategies for improving customer value. Step 3.Identify the best sustainable differentiation.

Cost advantageTo gain cost advantage a firm has to go through 5 analysis steps:Step 1. Identify the firms primary and support activities.All the activities (form receiving and storing materials to marketing, selling and after sales support) that are undertaken to produce goods or services have to be clearly identified and separated from each other. This requires an adequate knowledge of companys operations because value chain activities are not organized in the same way as the company itself. The managers who identify value chain activities have to look into how work is done to deliver customer value.Step 2. Establish the relative importance of each activity in the total cost of the product.The total costs of producing a product or service must be broken down and assigned to each activity. Activity based costing is used to calculate costs for each process. Activities that are the major sources of cost or done inefficiently (when benchmarked against competitors) must be addressed first.Step 3. Identify cost drivers for each activity.Only by understanding what factors drive the costs, managers can focus on improving them. Costs for labor-intensive activities will be driven by work hours, work speed, wage rate, etc. Different activities will have different cost drivers.Step 4. Identify links between activities.Reduction of costs in one activity may lead to further cost reductions in subsequent activities.For example,fewer components in the product design may lead to less faulty parts and lower service costs. Therefore identifying the links between activities will lead to better understanding how cost improvements would affect he whole value chain. Sometimes, cost reductions in one activity lead to higher costs for other activities.Step 5. Identify opportunities for reducing costs.When the company knows its inefficient activities and cost drivers, it can plan on how to improve them. Too high wage rates can be dealt with by increasing production speed, outsourcing jobs to low wage countries or installing more automated processes.Differentiation advantageVCA is done differently when a firm competes on differentiation rather than costs. This is because the source of differentiation advantage comes from creating superior products, adding more features and satisfying varying customer needs, which results in higher cost structure.Step 1. Identify the customers value-creating activities.After identifying all value chain activities, managers have to focus on those activities that contribute the most to creating customer value.For example,Apple products success mainly comes not from great product features (other companies have high-quality offerings too) but from successful marketing activities.Step 2. Evaluate the differentiation strategies for improving customer value.Managers can use the following strategies to increase product differentiation and customer value: Add more product features; Focus on customer service and responsiveness; Increase customization; Offer complementary products.Step 3. Identify the best sustainable differentiation.Usually, superior differentiation and customer value will be the result of many interrelated activities and strategies used. The best combination of them should be used to pursue sustainable differentiation advantage.ExampleThis example is partially adopted from R. M. Grants book Contemporary Strategy Analysis p.241. It illustrates the basic VCA for an automobile manufacturing company that competes on cost advantage. This analysis doesnt include support activities that are essential to any firms value chain, thus the analysis itself is not complete.Step 1

Step 2$164 Mless important$410 Mvery important$524 Mvery important$10 Mnot important$384 Mimportant$230 Mless important

Step 3 Number and frequency of new models Sales per model Order size Average value of purchases per supplier Location of suppliers Scale of plants Capacity utilization Location of plants Level of quality targets Frequency of defects Size of advertising budget Strength of existing reputation Sales Volume Number of dealers Sales per dealer Frequency of defects requiring repair recalls

Step 41. High-quality assembling process reduces defects and costs in quality control and dealer support activities.2. Locating plants near the cluster of suppliers or dealers reduces purchasing and distribution costs.3. Fewer model designs reduce assembling costs.4. Higher order sizes increase warehousing costs.

Step 51. Create just one model design for different regions to cut costs in designing and engineering, to increase order sizes of the same materials, to simplify assembling and quality control processes and to lower marketing costs.2. Manufacture components inside the company to eliminate transaction costs of buying them in the market and to optimize plant utilization. This would also lead to greater economies of scale.

ANSOFF MATRIX

Market penetration[edit]Inmarket penetrationstrategy, the organization tries to grow using its existing offerings (products and services) in existing markets. In other words, it tries to increase its market share in current market scenario.Market development[edit]Inmarket developmentstrategy, a firm tries to expand into new markets (geographies, countries etc.) using its existing offerings.Product development[edit]Inproduct developmentstrategy, a company tries to create new products and services targeted at its existing markets to achieve growthDiversification[edit]Indiversificationan organization tries to grow their introducing new offerings in new markets. It is the most risky strategy since both product and market development is required.

PORTERS 5 FORCES

Tip:The terms "Cost Focus" and "Differentiation Focus" can be a little confusing, as they could be interpreted as meaning "afocus on cost" or "afocus on differentiation."Remember that Cost Focus means emphasizing cost-minimizationwithin a focused market, and Differentiation Focus means pursuing strategic differentiationwithin a focused market.The Cost Leadership StrategyPorter's generic strategies are ways of gaining competitive advantage in other words, developing the "edge" that gets you the sale and takes it away from your competitors. There are two main ways of achieving this within a Cost Leadership strategy: Increasing profits by reducing costs, while charging industry-average prices. Increasing market share through charging lower prices, while still making a reasonable profit on each sale because you've reduced costs.Tip:Remember that Cost Leadership is about minimizing the cost to the organization of delivering products and services. The cost or price paid by the customer is a separate issue!The Cost Leadership strategy is exactly that it involves being the leader in terms of cost in your industry or market. Simply being amongst the lowest-cost producers is not good enough, as you leave yourself wide open to attack by other low-cost producers who may undercut your prices and therefore block your attempts to increase market share.You therefore need to be confident that you can achieve and maintain the number one position before choosing the Cost Leadership route. Companies that are successful in achieving Cost Leadership usually have: Access to the capital needed to invest in technology that will bring costs down. Very efficient logistics. A low-cost base (labor, materials, facilities), and a way of sustainably cutting costs below those of other competitors.The greatest risk in pursuing a Cost Leadership strategy is that these sources of cost reduction are not unique to you, and that other competitors copy your cost reduction strategies. This is why it's important to continuously find ways of reducing every cost. One successful way of doing this is by adopting the JapaneseKaizenphilosophy of "continuous improvement."The Differentiation StrategyDifferentiation involves making your products or services different from and more attractive those of your competitors. How you do this depends on the exact nature of your industry and of the products and services themselves, but will typically involve features, functionality, durability, support and also brand image that your customers value.To make a success of a Differentiation strategy, organizations need: Good research, development and innovation. The ability to deliver high-quality products or services. Effective sales and marketing, so that the market understands the benefits offered by the differentiated offerings.Large organizations pursuing a differentiation strategy need to stay agile with their new product development processes. Otherwise, they risk attack on several fronts by competitors pursuing Focus Differentiation strategies in different market segments.The Focus StrategyCompanies that use Focus strategies concentrate on particular niche markets and, by understanding the dynamics of that market and the unique needs of customers within it, develop uniquely low-cost or well-specified products for the market. Because they serve customers in their market uniquely well, they tend to build strong brand loyalty amongst their customers. This makes their particular market segment less attractive to competitors.As with broad market strategies, it is still essential to decide whether you will pursue Cost Leadership or Differentiation once you have selected a Focus strategy as your main approach: Focus is not normally enough on its own.But whether you use Cost Focus or Differentiation Focus, the key to making a success of a generic Focus strategy is to ensure that you are adding something extra as a result of serving only that market niche. It's simply not enough to focus on only one market segment because your organization is too small to serve a broader market (if you do, you risk competing against better-resourced broad market companies' offerings.)The "something extra" that you add can contribute to reducing costs (perhaps through your knowledge of specialist suppliers) or to increasing differentiation (though your deep understanding of customers' needs).Tip:Generic strategies apply to not-for-profit organizations too.A not-for-profit can use a Cost Leadership strategy to minimize the cost of getting donations and achieving more for their income, while one with pursing a Differentiation strategy will be committed to the very best outcomes, even if the volume of work they do as a result is lower.Local charities are great examples of organizations using Focus strategies to get donations and contribute to their communities.