a) Wholesale Market Features of Marketing: Objectives of marketing:

Marketing: b) Retail Market

Marketing is consumer oriented To Satisfaction of human wants
Meaning: Time: Marketing precedes and succeeds production To Profit maximization
Marketing starts and ends with the buyer To develop marketing field
The term ‘market’ has been derived from the Latin word ‘Mercatus’ which a) Very short period Market Marketing guides business To Effective distribution of products
mean ‘to trade’. The term carries certain other meanings like merchandise, wares, b) Short period Market To find sources for further information market problems
etc. c) Long period Market Importance of marketing: To take appropriate actions in the course of actions

A market is essentially a place where goods and services are offered for 1) It enables the marketer to know the tastes and preferences of the customers
sale. It is here that buyers meet sellers and get firsthand information about the and accordingly make the product. As a result they are able to sell their
goods they want to buy. Different types of goods are sold in a market ranging from Importance: easily.
fruits and vegetables (perishable) to fridge and television (durables). 2) It fulfils the needs of the buyers by giving them what they want. The buyers
a) Primary Market get their money’s worth.
Definition: b) Secondary Market 3) Innovations in marketing have given the buyer superior goods at affordable
c) Terminal Market prices.
According to Pyle, “Market includes both place and region in which buyer and 4) Marketing, today, has developed to such an extent that buyer are able get
sellers are in free competition with one another”. Nature of goods: international brands of goods at their doorstep.
5) In the past, the buyer had to buy what was available. The growth of
a) Commodity Market
marketing has now given the buyers very many alternatives. The buyers are
b) Capital market
now in a position to select the best from among the many alternatives.
Classification of Market:
Regulation: 6) It has eliminated outdated or obsolete products over the years. It has updated
Markets can be classified in many ways. Generally, the classification is made the technology in tune with the needs.
on: a) Regulated Market 7) It helps the marketers in the matter of selection of the right promotional tool.
b) Unregulated Market 8) It also guides the manufacturers in selecting the correct channel of
Geographic Area: distribution fot their products.
Nature of transactions: 9) Marketing provides employment opportunities to many. There are brokers,
a) Local market commission, agents, truck operators, salesmen, copywriters and others who
b) National Market a) Spot Market are engaged in the field of marketing.
c) International Market b) Forward Market 10) Marketing has certainly converted ‘yesterday’s luxuries into today’s
necessaries’. Goods that were once considered a beyond the reach of the
Economic: Marketing: common man are now common household items.

a) Perfect Market Definition:

b) Monopolistic Market
c) Monopoly Market According to William J. Stanton “ Marketing is a total system of
d) Oligopoly Market interacting business activities designed to plan, price, promote and distribute want-
satisfying products and services to present and potential customers”
Volume of Business:
3 4 5 6

Approaches to the study of marketing:

etc., engaged in the marketing during the movement of goods. The approach is also services between producers and customers.” This system gives too much
Marketing functions: 1. Product or Commodity Approach: known as middlemen approach. Here, emphasis is given to understand and importance to various marketing functions and fails to explain how such functions
Under the commodity approach the focus is placed on the product analyses the functions of institutions, who are discharging their marketing are applied to the specific business operations.
or it is an approach on the marketing on commodity wise basis. In other words, the functions. 4. Management Approach:
study relates to the flow of a certain commodity and its movement from the
This approach is the latest and scientific. It concentrates upon the
The activities of each institution form a part of marketing and collectively
original producer right up to the ultimate customer. The subject-matter, under this
activities or marketing functions and focuses on the role of decision-making at the
complete the marketing functions. In the process of moving the goods from the
study, is commodity.
level of firm. This approach is mainly concerned with how managers handle
MARKETING FUNCTIONS producer to the final consumers, a large number of persons are engaged. This
When one studies the marketing on this basis—commodity approach, one must specific problems and situations. It aims through evaluation of current market
system pays attention to the problems and functions of marketing institutions-
begin to study and analyses the problems relating to a commodity i.e., sources and practices to achieve specific marketing objectives.
transporting, banks and other financial institutions, warehousing, advertising,
conditions of supply, nature and extent of demand, mode of transporting, storage, insurance etc. This method does not give adequate knowledge of the entire Generally there are two factors-controllable and uncontrollable, which are
standardization, packing etc. Again, take an example of a commodity, say rice. marketing functions and also’ fails to explain the interrelations of different more concerned with the decision-making. Controllable include price adjustment,
institutions. advertisement etc. Uncontrollable-economical, sociological, psychological,
One has to study the sources of rice, location, people involved in buying and
Functions of Exchange facilitating functions Functions of Physical supply
selling, means of transport, problems of selling the product, financing, storage, 3. Functional Approach: political etc. are the basic causes for market changes. And these changes cannot be

packing etc. Thus, we get a full picture of the marketing from the original producer The functional approach gives importance on the various functions of controlled by any firm.

to the ultimate consumer. The method of study is repeated for each item. marketing. In other words, one concentrates attention on the specialized services or
Transportation Storage & But controllable can be controlled by the firm. The uncontrollable limit the
Warehouse functions performed by marketers. In this approach, marketing splits into many
Selling The system claims that it is simple and gives good result over the marketing of marketing opportunities. As such, managerial approach is concerned with the study
Buying functions-buying, selling, pricing, standardization, storage, transportation,
each product; description study is possible. But at the same time this approach is of uncontrollable and then taking decisions for controllable within the scope set by
Assembling Financing Risk-taking Standardization Market advertising, packing etc. This may be studied one after another. Here each function
& grading time-consuming and repetitive process which is a drawback. uncontrollable. Managerial or decision-making approach emphasizes on the
Information is studied in detail in order to understand it and analyses the nature, need and
practical aspects of marketing, but ignores the theoretical aspects of marketing. At
importance of each function.
the same time, this approach, provides an overall information of the entire
2. Institutional Approach: In this approach, marketing is regarded as “business of buying and business.
In the institutional approach, the focus is on the study of institutions- selling and as including those business activities involved in the flow of goods and
middlemen, wholesalers, retailers, importers, exporters, agencies, warehousing
7 8 9 10
5. System Approach: 7. Legal Approach: 3. Selling concept: – UNIT-II
The system approach can be defined as “a set of objects together with the This approach emphasizes only one aspect i.e., transfer of ownership It is not sufficient for the manufacturer to made the goods and wait for MARKETING MIX:
the customers. Thus, according to this concept it is very important to inform the
relationships among them and their attributes.” Systems focus on interrelations and to buyer: It explains the regulatory aspect of marketing. In India, the marketing
consumer about the product which can be done through different ways of Definition:
interconnections among the functions of marketing. The system examines activities are largely controlled by Sales of Goods Act, Carrier Act etc. The study promotion.
The marketing mix refers to the set of actions, or tactics, that a company
marketing connections (linkage) inside as well as outside the firm. Inside the firm is concentrated only on legal aspects, leaving other important aspects. This does
uses to promote its brand or product in the market. The 4Ps make up a typical
there is a co-ordination of business activities-engineering, production, marketing, not give an idea of marketing. marketing mix - Price, Product, Promotion and Place. However, nowadays, the
4. Marketing concept: –
price etc. marketing mix increasingly includes several other Ps like Packaging, Positioning,
8. Economic Approach: Consumer now a day is treated as “GOD”. So it is very important for People and even Politics as vital mix elements.
This approach deals with only the problems of supply, demand and the manufacturer to produce the product which the consumer wants, so that
On the basis of feedback information proper control is exercised to modify or consumer get satisfaction and manufacturer earns profit. Meaning:
price. These are important from the economic point of view, but fail to give a clear
alter in the producing process, so that the desired output can be produced. Here, the
idea of marketing. The term 'marketing mix' is a foundation model for businesses,
aim is to secure profit through customer-satisfaction. Markets can be understood historically centered around product, price, place, and promotion (also known as
the "4 Ps"). The marketing mix has been defined as the "set of marketing tools that
only through the study of marketing information. For instance, business is Modern marketing concept: the firm uses to pursue its marketing objectives in the market”. Thus the marketing
5. Consumer concept:-
composed of many functions, which are composed of sub functions. Each function mix refers to four broad levels of marketing decision: product, price, place, and
Modern concepts of marketing are broad concepts. It means finding out the promotion
or sub-function is independent, but interrelated and enables the other to achieve Now not only marketing concept is sufficient rather the companies
consumer and make the goods as per their needs rather than to provide them what
are using consumer concept which means to give attention to individual consumer
the seller has made. Thus it is very essential for the seller to get the answer of the
marketing objectives. it can be done through one to one marketing.
question what are the things which the consumer want? And how these things can
be made available to them? Only then he can survive in the market and earn profit. 6. Societal marketing concept:
There are 6 modern concepts of marketing which are very important from the point
6. Societal Approach: of view of marketer. This concept means that company should not only work for the
This approach has been originated recently. The marketing process is consumer but also for the society. So the company should make balance between
1. Production concept: – company’s profits, consumer wants and society welfare.
regarded as a means by which society meets its own consumption needs. This
The companies which use the production concept generally focus too
system gives no importance as to how the business meets the consumer’s needs. narrowly on their own activities because according to this concept the companies
Therefore, attention is paid to ecological factors (sociological, cultural, legal etc.) think that consumer will buy the product which comes in the market.

and marketing decisions and their impact on the society’s well-being. 2. Product concept: –

As per this concept companies give importance to the features or the

quality of the product because in long run the product exists only with the
quality it is giving to the consumer.

11 12 13 14

costing of the product on offer. If a product is priced higher or lower than its The flow of goods from the place of destination, involves a number of activities A concentration takes place because of dispersion. Otherwise
perceived value, then it will not sell. This is why it is imperative to understand how which is not a simple task. These activities of transfer are functions which are concentration has no meaning. The goods or products, assembled at a central
a customer sees what you are selling. If there is a positive customer value, than a known as marketing process. place, have to be consumers. Some of the products are dispersed to
product may be successfully priced higher than its objective monetary value. manufacturers or processors and the remaining goods are dispersed to the
Conversely, if a product has little value in the eyes of the consumer, then it may 1) Concentration final consumers through a chain of wholesalers, retailers, agents, middlemen
need to be underpriced to sell. Price may also be affected by distribution plans, etc. The products meant for ultimate users are subdivided into small lots
value chain costs and markups and how competitors price a rival product. 2) Dispersion required to meet the final consumptions.
3) Equalization Dispersion is essential, the buyers are scattered or located not near the
Promotion
firm or in a concentrated place. In the absence of consumption, production
The marketing communication strategies and techniques all fall under 1) Concentration: has no meaning. The purpose of production and its concentration aims at
the promotion heading. These may include advertising, sales promotions, special finding consumers at profitable and accepted price.
offers and public relations. Whatever the channel used, it is necessary for it to be The first process of marketing is concentration. Concentration aims at the
suitable for the product, the price and the end user it is being marketed to. It is collection of products at a central place. It is because of:
important to differentiate between marketing and promotion. Promotion is just the
communication aspect of the entire marketing function. a) Small lot output: 3) Equalization:
Agricultural produce, eggs, fruits, vegetables, dairy products, such as Between the two activities i.e., concentration and dispersion, there is the
Place
milk, butter, ghee etc. are collected at a central place from innumerable equalization process. It implies the reconciliation between demand and
Place or placement has to do with how the product will be provided to farmers, scattered here and there. These are marketed in natural form. To supply through storage and transportation in needed quantity and quality at
the customer. Distribution is a key element of placement. The placement strategy make other marketing services such as grading and standardisation, for the required time and place. Adjustments of supply to demand are effected.
will help assess what channel is the most suited to a product. How a product is the benefit of consumers, all produces- rice, wheat, cotton, tea etc. are
Product accessed by the end user also needs to compliment the rest of the product strategy. brought to a central place. Concentration, dispersion and equalization constitute the soul of marketing.
The productt is either a tangible good or an intangiblele service that is All the functions are performed by middlemen. Each process is not
b) Assembly of parts: independent, but mutually interdependent and equally important. Middlemen
seem to meet a specificc customer need or demand. All produ ducts follow a
logical product life cycle an
and it is vital for marketers to understand and
an plan for the assist in the transfer of ownership to consumers, but do not take title. Such
Some types of manufactured products need assembly work; for middlemen are called functional middlemen. The middlemen, who buy
various stages and their uniq
nique challenges. It is key to understand those
th problems example, spare parts of products. These parts are manufactured at
that the product is attemptin
ting to solve. The benefits offered by thee product
p and all goods under an outright sale, are called merchant middlemen, who sell to
Marketing System: different firms and at different places. To make the final products, consumers.
its features need to be under
erstood and the unique selling proposition n of the product assembly or concentration is essential.
need to be studied. In addiddition, the potential buyers of the produ duct need to be A market system is the network of buyers, sellers and other actors that come
identified and understood. Product:
together to trade in a given product or service. The participants in a market c) To facilitate regular supply:
system include: Direct market players such as producers, buyers, and consumers Meaning:
who drive economic activity in the market. To ensure the continuous supply of products to the consumers,
concentration is essential. Generally the jobs are undertaken by In marketing, a product is an object or system made available for consumer use;
Price Marketing Process: wholesalers, exporters, agents, etc. it is anything that can be offered to a market to satisfy the desire or need of a
Price covers thee actual amount the end user is expected ted to pay for a customer.[1] In retailing, products are often referred to as merchandise, and
product. How a product iss ppriced will directly affect how it sells. This
Th is linked to in manufacturing, products are bought as raw materials and then sold as finished
Marketing is a process by means of which goods and services are exchanged.
what the perceived value of the product is to the customer rather tha han an objective goods. A service is also regarded to as a type of product.
The goal of marketing is to move the products from the producer to the consumer. 2) Dispersion:
15 16 17 18
Definition:
Screening of ideas means a close and detailed examination of ideas, to Product development encompasses the technical activities of engineering
A product is the item offered for sale. A product can be a service or an item. It determine which of the ideas have potential and are capable of making significant and design. At this stage, the engineering department converts the product concept
can be physical or in virtual or cyber form. Every product is made at a cost and
each is sold at a price. The price that can be charged depends on the market, the contribution to marketing objectives. In fact, generation of ideas is not that into a concert form of product in view of the required size, shape, design, weight,
quality, the marketing and the segment that is targeted. Each product has a useful
significant as the system for screening the generated ideas. colour etc. of the product concept.
life after which it needs replacement, and a life cycle after which it has to be re-
invented. In FMCG parlance, a brand can be revamped, re-launched or extended to
make it more relevant to the segment and times, often keeping the product almost 3. Product Concept Development:
A model or prototype of the product is manufactured on a limited scale.
the same. Screening of ideas means a close and detailed examination of ideas, to
Decisions are also made with regard to packaging, brand name, label etc. of the
Product Planning and Development: Top 7 Steps: determine which of the ideas have potential and are capable of making significant
product.
contribution to marketing objectives. In fact, generation of ideas is not that
The steps are: 1. Generation of New Product Ideas 2. Screening of Ideas 3. 6. Test Marketing:
significant as the system for screening the generated ideas. A sample of the product is tested in a well-chosen and authentic sales
Product Concept Development 4. Commercial Feasibility 5. Product Development
environment; to find out consumers’ reaction. In view of consumers’
6. Test Marketing 7. Commercialisation. The ideas should be screened properly; as any idea passing this stage would reactions, the product may be improved further.
cost the firm in terms of time, money and efforts, at subsequent stages in product
1. Generation of New Product Ideas: 7. Commercialisation:
planning and development.
The first step in product planning and development is generation of ideas for the After the management is satisfied with the results of test marketing, steps are
development of new/innovative products. 3. Product Concept Development: taken to launch a full-fledged programme for the production, promotion and
Those product ideas which clear the screening stage must be
developed into a product concept – identifying physical features, benefits, marketing of the product. It is the stage where the new product is born; and it
Ideas may come from internal sources like company’s own Research and
price etc. of the product. At this stage product idea is transformed into a enters it life cycle process.
Development (R&D) department, managers, sales-force personnel etc.; or from product concept i.e. a product which target market will accept.
external sources like, customers, dealers, competitors, consultants, scientists etc. 4. Commercial Feasibility:
Product life cycle: 1. Introduction
At this stage, the purpose is to determine whether the proposed product
At this stage, the intention of management is to generate more and more new Once a product has been developed, the first stage is its introduction stage. In
idea is commercially feasible, in terms of demand potential and the costs of this stage, the product is being released into the market. When a new product is
and better product ideas; so that the most practical and profitable ideas may be released, it is often a high-stakes time in the product's life cycle - although it does
production and marketing. Management must also ensure that product concept is
not necessarily make or break the product's eventual success.
screened subsequently.
compatible with the resources of the organization technological, human and
2. Screening of Ideas: financial Costs are generally very high and there is typically little competition. The
principle goals of the introduction stage are to build demand for the product and
get it into the hands of consumers, hoping to later cash in on its growing
5. Product Development: popularity.
19 20 21 22

2. Growth developing their product to meet with new demographics or developing UNIT-III The influencing factors fo
for a price decision can be divided into
to two groups:
By the growth stage, consumers are already taking to the product and technologies.
increasingly buying it. The product concept is proven and is becoming more PRICING:
popular - and sales are increasing. The maturity stage may last a long time or a short time depending on the product.
For some brands, the maturity stage is very drawn out, like Coca-Cola. Meaning:
Other companies become aware of the product and its space in the market,
which is beginning to draw attention and increasingly pull in revenue. If Pricing is a process of fixing the value that a manufacturer will receive in the
4. Decline exchange of services and goods. Pricing method is exercised to adjust the cost of
competition for the product is especially high, the company may still heavily invest
in advertising and promotion of the product to beat out competitors. As a result of the producer’s offerings suitable to both the manufacturer and the customer. The
the product growing, the market itself tends to expand. The product in the growth Although companies will generally attempt to keep the product alive in the pricing depends on the company’s average prices, and the buyer’s perceived value
stage is typically tweaked to improve functions and features. maturity stage as long as possible, decline for every product is inevitable. of an item, as compared to the perceived value of competitors product.
Every businessperson starts a business with a motive and intention of earning
As the market expands, more competition often drives prices down to make profits. This ambition can be acquired by the pricing method of a firm. While
In the decline stage, product sales drop significantly and consumer behavior
the specific products competitive. However, sales are usually increasing in volume fixing the cost of a product and services the following point should be considered:
changes as there is less demand for the product. The company's product loses more
and generating revenue. Marketing in this stage is aimed at increasing the product's
and more market share, and competition tends to cause sales to deteriorate. • The identity of the goods and services
market share.
• The cost of similar goods and services in the market
Marketing in the decline stage is often minimal or targeted at already loyal • The target audience for whom the goods and services are produces I .Internal Factors :
3. Maturity
customers, and prices are reduced. • The total cost of production (raw material, labour cost, machinery cost, Those factors, which are we
well within the control of the business, are
re called internal
When a product reaches maturity, its sales tend to slow or even stop - signaling transit, inventory cost etc).
• External elements like government rules and regulations, policies, economy, factors. These include :
a largely saturated market. At this point, sales can even start to drop. Pricing at this
Eventually, the product will be retired out of the market unless it is able to etc., 1) costs and
stage can tend to get competitive, signaling margin shrinking as prices begin
redesign itself to remain relevant or in-demand. For example, products like
falling due to the weight of outside pressures like competition or lower demand. 2) Business objectives.
typewriters, telegrams and muskets are deep in their decline stages (and in fact are
Marketing at this point is targeted at fending off competition, and companies will a) Return on investment
almost or completely retired from the market).
often develop new or altered products to reach different market segments. Definition:
b) Market share
Pricing is the method of determining the value a producer will get in the
Given the highly saturated market, it is typically in the maturity stage of a c) preventing competition
exchange of goods and services. Simply, pricing method is used to set the price of
product that less successful competitors are pushed out of competition - often producer’s offerings relevant to both the producer and the customer. d) meeting competition
called the "shake-out point." e) stability in price
Pricing Decisions: Internal and External Factors
f) Maximum profit
In this stage, saturation is reached and sales volume is maxed out. Companies
often begin innovating to maintain or increase their market share, changing or II. External Factors:

23 24 25 26
 Procedure for price determination: 8. To check seasonal decline in the volume of sales. 11. To train the dealers and customers.
Those factors, which are beyond the control of the marketer, are called external
There is no specific procedure applicable to all firms for price determination.
factor. Although they are beyond the marketer’s control, they cannot be ignored. Importance of Sales Promotion: 12. To assist and support other promotional measures.
However, the following steps may be followed to determine the price: The importance of sales promotion has increased tremendously in the modern
They play a crucial role in pricing decisions and are as important as the internal Determine demand for the product times. Lakhs of rupees are being spent on sales promotional activities to attract the 13. To help in collecting the amounts due from the market.
Anticipate and analyse the competitive reaction consumers in our country and also in other countries of the world.
factors. These include the following:
Establish expected share of the market 14. To help in gathering and reporting marketing intelligence.
1) Demand Some large companies have also begun to appoint sales promotion managers to
2) Competition Select pricing strategy handle miscellaneous promotional tools. All these facts show that the importance
3) Middlemen Consider company’s marketing policies of sales promotion activities is increasing at a faster rate. Advertising:
4) Government regulations Set the price
Personal selling: Definition:
5) Political condition
Personal selling is when a salesperson meets a potential buyer or buyers face-to- Advertising is a means of communication with the users of a product or
UNIT-IV face with the aim of selling a product or service.
service. Advertisements are messages paid for by those who send them and are
Sales Promotion
Different kinds of pricing: The objectives of Personal selling are as follows:
Definition: intended to inform or influence people who receive them, as defined by the
American Marketing Association defines sales promotion as “media and non- 1.To enhance the sales volume of the different products of the company
Odd pricing media marketing pressure applied for a predetermined, limited period of time in Advertising Association of the UK.
order to stimulate trial, increase consumer demand, or improve product 2. To ensure the there is a proper mix of products in the total sales volume
Psychological pricing
availability”.
Price based on the prevailing or ruling price Types of advertising may be classified as:
3. To ensure that the market share of the company is increased
Prestige price objectives:
Customary price 1. Product Advertising.
4. To ensure that the profits of the company have improved
1. To increase sales by publicity through the media which are complementary to 2. Institutional Advertising.
Free On Board pricing
press and poster advertising. 5. To bring down or reduce the overall selling expenses of the company 3. Other Types.
Cost, Insurance and Fright pricimg Types of Advertising Media
Dual pricing 2. To disseminate information through salesmen, dealers etc., so as to ensure the 6. To gain new accounts and ensure that there is growth of the business
Administered pricing product getting into satisfactory use by the ultimate consumers. Types of advertising media available to an advertiser are:
Monopoly pricing 7. It helps in the appointment of dealers and expansion of the distribution channel.
3. To stimulate customers to make purchases at the point of purchase. (1) Direct Mail
Price lining
Expected pricing 8. To secure channel members co-operation in stocking as well as selling the (2) Newspapers And Magazines
4. To prompt existing customers to buy more.
products of the company.
Sealed tender pricing
5. To introduce new products. (3) Radio Advertising
Negotiated pricing 9. To achieve the desired proportion of cash and credit sales.
Mark-up pricing 6. To attract new customers. (4) Television Advertising
Skimming pricing 10. To provide pre-sale and after-sale services.
7. To meet competition from others effectively. (5) Film Advertising
Penetration pricing
27 28 29 30

(6) Outdoor Advertising place which is a huge benefit to customers as they don’t have to visit level channel of distribution works best for manufacturers dealing in The Internet as A Distribution Channel:
different retailers for different products. shopping goods like clothes, shoes, furniture, toys, etc.
(7) Window Display • Sharing Risks: Since most of the channels buy the products beforehand, they • Two-Level Channel (Manufacturer to Wholesaler to Retailer to The internet has revolutionised the way manufacturers deliver goods. Other
also share the risk with the manufacturers and do everything possible to sell Customer): Wholesalers buy the bulk from the manufacturers, breaks it than the traditional direct and indirect channels, manufacturers now
(8) Fairs and Exhibition And it. down into small packages and sells them to retailers who eventually sell it to use marketplaces like Amazon (Amazon also provide warehouse services for
• Marketing: Distribution channels are also called marketing channels because the end customers. Goods which are durable, standardised and somewhat manufacturers’ products) and other intermediaries like aggregators
(9) Specially Advertising they are among the core touch points where many marketing strategies are inexpensive and whose target audience isn’t limited to a confined area use
executed. They are in direct contact with the end customers and help the two-level channel of distribution. (uber, Instacart) to deliver the goods and services. The internet has also resulted in
Distribution Channel: manufacturers in propagating the brand message and product benefits and • Three-Level Channel (Manufacturer to Agent to Wholesaler to Retailer the removal of unnecessary middlemen for products like software which are
other benefits to the customers. to Customer): Three level channel of distribution involves an agent besides distributed directly over the internet.
A distribution channel (also called a marketing channel) is the path or route Types of Distribution Channels: the wholesaler and retailer who assists in selling goods. These agents come
decided by the company to deliver its good or service to the customers. The route handy when goods need to move quickly into the market soon after the order
can be as short as a direct interaction between the company and the customer or Factors Determining the Choice of Distribution Channels
Channels of distribution can be divided into the direct channel and the indirect is placed. They are given the duty to handle the product distribution of a
can include several interconnected intermediaries like wholesalers, distributors, channels. Indirect channels can further be divided into one-level, two-level, and specified area or district in return of a certain percentage commission. The
retailers, etc. Selection of the perfect marketing channel is tough. It is among those few strategic
three-level channels based on the number of intermediaries between manufacturers agents can be categorised into super stockists and carrying and forwarding decisions which either make or break your company.
and customers. agents. Both these agents keep the stock on behalf of the company. Super
Hence, a distribution channel can also be referred to as a set of interdependent stockists buy the stock from manufacturers and sell them to wholesalers and
intermediaries that help make a product available to the end customer. Even though direct selling eliminates the intermediary expenses and gives more
retailers of their area. Whereas, carrying and forwarding agents work on a control in the hands of the manufacturer, it adds up to the internal workload and
commission basis and provide their warehouses and shipment expertise for raises the fulfilment costs. Hence these four factors should be considered before
Functions of Distribution Channels: 1) Direct Channel or Zero-Level Channel (Manufacturer To order processing and last mile deliveries. Manufacturers opt for three-level deciding whether to opt for the direct or indirect distribution channel.
Customer) marketing channel when the userbase is spread all over the country and the
In order to understand the importance of distribution channels, you need to demand of the product is very high.
understand that it doesn’t just bridge the gap between the producer of a product UNIT-V
Direct selling is one of the oldest forms of selling products. It doesn’t involve Dual Distribution:
and its user. the inclusion of an intermediary and the manufacturer gets in direct contact with Recent Trends in Modern Marketing:
the customer at the point of sale. Some examples of direct channels are peddling, When a manufacturer uses more than one marketing channel simultaneously to
• Distribution channels provide time, place, and ownership utility. They make brand retail stores, taking orders on the company’s website, etc. Direct channels reach the end user, he is said to be using the dual distribution strategy. They may 1. More Emphasis on Quality, Value, and Customer Satisfaction:
the product available when, where, and in which quantities the customer are usually used by manufacturers selling perishable goods, expensive goods, and open their own showrooms to sell the product directly while at the same time use Today’s customers place a greater weight to direct motivations
wants. But other than these transactional functions, marketing channels are whose target audience is geographically concentrated. For example, bakers, internet marketplaces and other retailers to attract more customers. (convenience, status, style, features, services and qualities) to buy product. Today’s
also responsible to carry out the following functions: jewellers, etc. marketers give more emphasis on the notion, “offer more for less.”
• Logistics and Physical Distribution: Marketing channels are responsible for A perfect example of goods sold through dual distribution is smartphones.
assembly, storage, sorting, and transportation of goods from manufacturers 2) Indirect Channels (Selling Through Intermediaries) 2. More Emphasis on Relationship Building and Customer Retention:
to customers. Distribution Channels for Services: Today’s marketers are focusing on lifelong customers. They are shifting
• Facilitation: Channels of distribution even provide pre-sale and post- When a manufacturer involves a middleman/intermediary to sell its product to the from transaction thinking to relationship building. Large companies create,
purchase services like financing, maintenance, information dissemination end customer, it is said to be using an indirect channel. Indirect channels can be Unlike tangible goods, services can’t be stored. But this doesn’t mean that all the maintain and update large customer database containing demographic, life-style,
and channel coordination. classified into three types: services are always delivered using the direct channels. past experience, buying habits, degree of responsiveness to different stimuli, etc.,
• Creating Efficiencies: This is done in two ways: bulk breaking and creating and design their offerings to create, please, or delight customers who remain loyal
assortments. Wholesalers and retailers purchase large quantities of goods With the advent of the internet, online marketplaces, the aggregator business to them. Similarly more emphasis is given to retain them throughout life.
• One-level Channel (Manufacturer to Retailer to Customer): Retailers
from manufacturers but break the bulk by selling few at a time to many other model, and the on-demand business model, even services now use intermediaries Marketers strongly believe: “Customer retention is easier than customer creation.”
buy the product from the manufacturer and then sell it to the customers. One
channels or customers. They also offer different types of products at a single to reach to the final customers.
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3. More Emphasis on Managing Business Processes and Integrated hiring salesmen, setting own distribution network, designing network marketing, i. Craze for international standards and emphasis on quality, value and customer If you compare its cost with traditional marketing media such as newspaper ads
Business Functions: applying online marketing, and contracting with giant shopping/retailing malls. satisfaction. Application of TQM (even, Six Sigma) in every aspect of marketing and billboards, then it’s much cheaper and efficient. You can reach a wide range of
Today’s companies are shifting their thinking from managing a set of semi management. audience with very limited resources.
independent departments, each with its own logic, to managing a set of People anywhere in the world can access the Internet and companies’ home
fundamental business processes, each of which impact customer service and pages to scan offers and order goods. Via online service, they can give and get ii. Changed attitude toward competition. They compete not for maximum gains but Tangible ROI
satisfaction. Companies are assigning cross-disciplinary personnel to manage each advice on products and services by chatting with other users, determine the best for maximum offers to customers. Small business owners can now check the turnover rate or ‘‘action taken’’ with
process. values, place orders, and get next-day delivery. the help of Infusionsoft. It analyzes multiple things like views of videos, number of
iii. Relationship marketing at both levels at internal functions of organisation and emails opened, and per click on the link. Most importantly, it tells us how much
Marketing personnel are increasingly working on cross- disciplinary terms rather As a result of advances in database technology, companies can do more at outside with service providers, to satisfy customers. sales the business has been made as a result of e-marketing.
than only in the marketing department. This is the positive development, which direct marketing and rely less on wholesale and retail intermediaries. Beyond this,
broadens marketers’ perspectives on business and also leads to broaden perspective much company buying is now done automatically through electronic data iv. Concept of global and complex customers.
of employees from other department. interchange link among companies. All these trends portend a greater buying and E-marketing is Cheaper than Traditional Marketing
selling efficiency. v. Marketing department is placed in the center of management. It enjoys unique
If you compare its cost with traditional marketing media such as newspaper ads
4. More Emphasis on Global Thinking and Local Market Planning: and dominant status in organisation.
and billboards, then it’s much cheaper and efficient. You can reach a wide range of
As stated earlier, today’s customers are global, or cosmopolitan. They exhibit 7. More Emphasis on Services Marketing: audience with very limited resources.
international characteristics. This is due to information technology, rapid means of As per general survey, about 70% people are, either directly or indirectly, vi. Use of latest technology for survey and research.
transportation, liberalization, and mobility of people across the world. Companies involved in service marketing. Because services are intangible and perishable, Tangible ROI
are pursuing markets beyond their borders. They have to drop their traditions, variable and inseparable, they pose additional challenges compared to tangible vii. More emphasis on after-sales services.
Small business owners can now check the turnover rate or ‘‘action taken’’ with
customs, and assumptions regarding customers. good marketing. Marketers are increasingly developing strategies for service firms the help of Infusionsoft. It analyzes multiple things like views of videos, number of
that sell insurance, software, consulting services, banking, insurance, and other viii. Entertaining value in advertising,
emails opened, and per click on the link. Most importantly, it tells us how much
They have to adapt to their offering as per the cultural prerequisites. Decisions are services. sales the business has been made as a result of e-marketing.
taken by local representatives, who are much aware of the global economic,
political, legal, and social realities. Companies must think globally, but act locally. 8. More Emphasis on High-tech Industries:
E-MARKETING: 24/7/365 Approach
Today’s marketers believe: “Act locally, but think globally.” Due to rapid economic growth, high-tech firms emerged, which differ from
It works 24 hours a day, 7 days a week and 365 days of the year. It doesn’t matter
traditional firms. High-tech firms face higher risk, slower product acceptance, Web marketing, digital marketing, internet marketing or online marketing; all of whether you’re homesick, sleeping, or attending a casual meetings; but e-
5. More Emphasis on Strategic Alliances and Networks: shorter product life cycles, and faster technological obsolescence. High-tech firms these words are synonymously used for E-Marketing. What it means is the marketing is always hard at work.
A company cannot satisfy customers without help of others. It lacks adequate must master the art of marketing their venture to the financial community and marketing of products or services by using the internet. E-mails and wireless
resources and requirements to succeed. Company needs to involve in partnering convincing enough customers to adopt their new products. marketing also fall into the category of e-marketing.
with other organisations, local as well as global partners who supply different
requirements for success. 9. More Emphasis on Ethical Marketing Behaviour: Eliminate Follow-up Failure
We can say that it uses different technologies and media to connect customers and
The market place is highly susceptible to abuse by those who lack scruples and Elimination of follow-up-failure is the main secrete behind the success of
businesses. Especially in this era of technology, e-marketing has become a very
Senior manager at top-level management spends an increasing amount of time for are willing to prosper at the expense of others. Marketers must practice their craft small business. It is done by entering your business figures into the Infusionsoft,
important part of the marketing strategy of different companies.
designing strategic alliance and network that create competitive advantages for the with high standards. Even, governments have imposed a number of restrictions to and then its automated marketing system will provide you the custom-tailored
Features of E-Marketing
partnering firms. Merger, acquisition, and partnering are result of a strong thirst for refrain them from malpractices. Marketers are trying to sell their products by information about your business, which areas to improve and what product to
Big or small, many businesses are using e-marketing because of various features
strategic alliance and networks. obeying and observing moral standards or business ethics. discontinue.
and multiple advantages. Some of the important features are as follows;
6. More Emphasis on Direct and Online Marketing: 10. Other issues:
E-marketing is Cheaper than Traditional Marketing E-Marketing Advantages
Information technology and communication revolution promise to
Some of the important advantages of e-marketing are given below;
change the nature of buying and selling. Companies follow direct channel in term
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1. Instant Response. The response rate of internet marketing is instantaneous; When we talk about digital and email marketing, then there are different It doesn’t matter whatever type of marketing methods you’re using; it has to be Inbound Telemarketing:
for instance, you upload something and it goes viral. Then it’d reach millions type and methods of e-marketing which are as follows; well focused and researched about your target market. Customer’s needs and It consists of handling incoming telephone calls—often generated by broadcast
of people overnight. demands should also be kept in mind; there should be consistency and coherency advertising, direct mail, or catalogues—and taking orders for a wide range of
2. Cost-Efficient. Compared to the other media of advertising, it’s much Email Marketing between the market and your product. Anything out of ordinary will make your
products. The representatives working in this type of telemarketing programme
cheaper. If you’re using the unpaid methods, then there’s almost zero cost. Email marketing is considered very efficient and effective because you already customers suspicious. It has to be realistic.
3. Less Risky. When your cost is zero and the instant rate is high; then what have a database of your targeting customer. Now, sending emails about your normally do not need as much training as the outbound representatives.
one has to loos. No risk at all. product or service to your exact targeted market is not only cheap but also very
4. Greater Data Collection. In this way, you have a great ability to collect a effective. Outbound Telemarketing:
wide range of data about your customers. This customer data can be used Tele-marketing: It can be aimed directly at the end consumer; for example, a home repair
later. Social Media Marketing business may call people to search for prospects and customers. Representatives
5. Interactive. One of the important aspects of digital marketing is that it’s Social media is a great source of directly communicating with your customers Definition: working on this side of the industry generally require more training and product
very interactive. People can leave their comments, and you’ll get feedback to increase your product awareness. It could be done by any or all of the social Telemarketing is the act of selling, soliciting, or promoting a product or knowledge, as more actual selling is involved in comparison to the inbound
from your target market. media channels such as LinkedIn, Facebook, Instagram, Twitter, Google, and service over the telephone; the telephone is the most cost-efficient, flexible, and operations.
6. Way to Personalized Marketing. Online marketing opens the door to YouTube. Some of the important advantages of social media are as follows;
statistically accountable medium available. At the same time, the telephone is still
personalized marketing with the right planning and marketing strategy, Advantages of Telemarketing:
customers can be made to feel that this ad is directly talking to him/her. Increase product awareness and reputation means more sales. very intimate and personal. It is individual to individual.
1. Human interaction:
7. Greater Exposure of your Product. Going viral with one post can deliver Directly communicating with your customers can increase brand loyalty. One of the advantages telemarketing has over other direct marketing methods
greater exposure to your product or service. You can increase the number of visits to your website and rank it up in the
Meaning: is that it involves human interaction.
8. Accessibility. The beauty of the online world and e-marketing is that it’s search engine.
accessible from everywhere across the globe. Targeting the exact audience will help you to know more about your Telemarketing is the process of using the telephone to generate leads, make
Disadvantages of E-Marketing customers’ needs. sales, or gather marketing information. Telemarketing can be a particularly
E-Marketing is not without disadvantages, some of them are as follows; Video Marketing valuable tool for small businesses, in that it saves time and money as compared 2. Small businesses:
It is said that a picture is worth a thousand words, and a video is worth with personal selling, but offers many of the same benefits in terms of direct Telemarketing can be a particularly valuable tool for small businesses,
1. Technology Dependent. E-Marketing is completely dependent on thousands of pictures. You can catch the attention and emotions of your target contact with the customers. in that it saves time and money as compared to personal selling, but offers many of
technology and the internet; a slight disconnection can jeopardize your whole market by showing them a video clip about your product or service. Video the same benefits in terms of direct contact with customers.
business. marketing is very effective if it conveys the right message to the right audience. Telemarketing is especially useful when the customers for a small business
2. Worldwide Competition. When you launch your product online, then you Article Marketing 3. Customer service:
products or services are located in hard-to-reach places, or when many prospects
face a global competition because it’s accessible from everywhere. Engaging quality content by providing valuable information to your targeted Building a loyal client base is a fundamental factor in establishing a
3. Privacy & Security Issues. Privacy and security issues are very high because must be contacted in order to find one interested in making a purchase.
market, what people are looking for over the internet to solve a certain problem? It long- term business success and increasing the value of the company.
your data is accessible to everyone; therefore, one has to be very cautious is a consistent and ongoing process of delivering quality content to your readers. It Telemarketing customer services can gain repeat orders and increase the
about what goes online. is not always about selling; you’re educating your audience and helping them by Although some small businesses operate exclusively by telephone, telemarketing
is most often used as part of an overall marketing programme to tie together penetration of the customer base. Telemarketing has the advantages of delivering
4. Higher Transparency & Price Competition. When privacy and security adding some value in their lives.
issues are high, then you have to spend a lot to be transparent. Price advertising and personal selling efforts. For example, a company might send excellent customer service.
competition also increases with higher transparency. Affiliate Marketing introductory information through the mail, then follow-up with a telemarketing call
5. Maintenance Cost. With the fast-changing technological environment, you Affiliate marketing is the process of promoting some products of certain brands to assess the prospect’s interest, and finally send a salesperson to visit. 4. Reduces cost:
have to be consistently evolved with the pace of technology and the and earning your commission out of every sale. It works for everyone; win, win As the costs of field sales continue to escalate, businesses are using
maintenance cost is very high. situation. Types of Telemarketing telemarketing as a way to reduce the cost of selling. It is also easier to
Types of E-Marketing Telemarketing can be either inbound or outbound in scope. communicate with customers. Most of the marketing efforts are directed towards
Wrapping Up E-Marketing select markets, so the cost per person contacted is less.
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 Mobile Marketing Marketing via text allows customers to opt-in to receive your text
5. Flexibility: messages. Here you can send coupons, special offers, and news on
It is the most flexible form of direct marketing. It helps in knowing Definition upcoming events directly to your customers’ cell phones.
and understanding what customers want, and are prepared to buy. Survey can be According to Mashable, marketing professor Andreas Kaplan defines mobile • Mobile Apps
conducted with the advantages of telemarketing, knowing what customers are marketing as “any marketing activity conducted through a ubiquitous network to
looking for, the product or service, the brand, etc.; one can constantly update the which consumers are constantly connected using a personal mobile device". In Do you have a specialized process that is unique to your company? For
client data base. other words, any promotion or advertising message sent through a cell phone, example, maybe you are a real estate company and are often asked to
usually a Smartphone. calculate mortgages. If so, create an app – like a mortgage calculator!
6. Response measurement: Creating a mobile app for a specialized process will make things easier for
Response measurement is possible by knowing the effectiveness of Benefits of Mobile Marketing your customers and generate new leads.
advertising. The results can be compared with the ones previously established, and According to Search Engine Journal, a Pew Study found that 57% of the U.S.
population owns a Smartphone and “are spending an average of two hours per • QR Codes
the future plans can be based on such results.
day on their mobile devices.” I think we are all well aware of the role mobile
QR codes can be scanned by mobile devices to provide special
Disadvantages of Telemarketing devices play in our day-to-day lives. This explains why marketers are targeting
information and discounts to users. Consider setting up a QR code to place
1. An increasing number of people have become averse to telemarketing. mobile devices with their advertisements. As far as benefits go, mobile marketing:
on paper ads, menus, or signs in your office. (Business2Community)
1. Allows you to reach a highly targeted market (i.e. via location)
2. No visual contact with the customer is possible. • Mobile Search
2. Has a much lower CPM (cost per thousand impressions) than other
traditional marketing channels (Wishpond) Optimize your website for mobile search by including localized terms as
3. More people are using technology to screen out unwanted callers, particularly
telemarketers. part of your keyword phrases (i.e. Pediatric Dentist Orlando, Florida). Make
1. Generates a higher response rate (Wishpond)
sure your phone number is also prominently displayed on your website,
2. Reaches your audience anywhere, anytime
4. Government is implementing tougher measures to curb unscrupulous especially when being displayed on mobile devices, and that it is clickable.
telemarketers. How to Use Mobile Marketing There are many more ways you can utilize mobile marketing to promote
your business and this trend is only going to grow in 2015. Keep your eyes peeled
5. If hiring an outside firm to do telemarketing, there is lesser control in the There are a handful of different ways to utilize mobile marketing to reach out to
for more mobile marketing strategies in the New Year! If you need assistance with
your customers. Below are some of the top mobile marketing strategies, as
process, given that the people doing the calls are not your employees. managing your mobile marketing strategy,
recommended by experts around the web:
6. A telephone conversation has very short memory. • Responsive Design
7. Pre-purchase inspection of goods not possible. If you plan on driving any traffic to your website as part of your mobile
marketing strategy, it is absolutely necessary that your website be
8. It can be extremely expensive, particularly if telemarketing is outsourced to an responsive. Responsive design refers to websites that dynamically resize to
outside firm. fit whatever device they are being displayed on. This is your first step in
mobile marketing.

• Text Messaging

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