To remove conflict is major challenge for conflict management. First of all, concentrate all dealers on subordinate goals of company. If there is big confliction between company and dealers, then company can take some meeting with dealers and agree them by giving positive arguments.
* Diplomacy :- A person goes to dealer and resolve the confliction
* Mediation :- Solve problem by expert of third party.
* Arbitration :- Agreement between two party by giving argument and confliction by arbitrator.
Showing posts with label marketing. Show all posts
Showing posts with label marketing. Show all posts
Saturday, September 4, 2010
Conflict Management
Conflict management is the process to reduce the problems of channel of distribution by solving them effective ways.
Main conflicts
Suppose company wants to achieve rapid market. In this case fix low price policy. But all dealers are seeing short run high profit. So, they are charging high profit margin and products are not sold easily by dealers. It will create confliction between dealers and company
Main conflicts
Suppose company wants to achieve rapid market. In this case fix low price policy. But all dealers are seeing short run high profit. So, they are charging high profit margin and products are not sold easily by dealers. It will create confliction between dealers and company
Types of Marketing Channels
A. Conventional Channel or Non- Integrated Channel
1. Manufacturer to Consumer
In this channel there is no intermediary. Manufacturer makes the goods and directly distributes to consumers.
2. Manufacturer to Retailer to Consumer
Retailer is the intermediary between manufacturer and consumer. He purchases goods from manufacturer and sells to consumer.
3. Manufacturer to Wholesaler to Retailer to Consumer
In this channel, there are two option, one is wholesaler and other is retailer. Wholesaler buys large scale and sells to retailer and the retailer sells to consumer.
4. Manufacturer to Wholesaler to Consumer
Consumer can buy easily and directly from wholesaler. So, in this channel there is only one intermediary and he is wholesaler.
5. Manufacturer to agent to wholesaler to retailer to consumer
B. Integrated Channel or Non conventional channels
Integrated channel are modern channel for distribution of goods. These channel can be divided into two parts.
1. Vertical Channel
Vertical channel is that corporate channel which are useful for the flow of products which are capital nature. In this, if one company contracts with other manufacturers who will convert the capital product into most usable shape and sell it to the dealers. Then it will be vertical channel.
2. Horizontal Channel
Two companies join together for marketing of any product for reducing competition and excess capacity.
1. Manufacturer to Consumer
In this channel there is no intermediary. Manufacturer makes the goods and directly distributes to consumers.
2. Manufacturer to Retailer to Consumer
Retailer is the intermediary between manufacturer and consumer. He purchases goods from manufacturer and sells to consumer.
3. Manufacturer to Wholesaler to Retailer to Consumer
In this channel, there are two option, one is wholesaler and other is retailer. Wholesaler buys large scale and sells to retailer and the retailer sells to consumer.
4. Manufacturer to Wholesaler to Consumer
Consumer can buy easily and directly from wholesaler. So, in this channel there is only one intermediary and he is wholesaler.
5. Manufacturer to agent to wholesaler to retailer to consumer
B. Integrated Channel or Non conventional channels
Integrated channel are modern channel for distribution of goods. These channel can be divided into two parts.
1. Vertical Channel
Vertical channel is that corporate channel which are useful for the flow of products which are capital nature. In this, if one company contracts with other manufacturers who will convert the capital product into most usable shape and sell it to the dealers. Then it will be vertical channel.
2. Horizontal Channel
Two companies join together for marketing of any product for reducing competition and excess capacity.
Monday, June 14, 2010
Channel of Distribution
Channel of distribution are the intermediaries which transfer goods from producers to consumers. Thus marketing channel are useful for proper distribution of goods and services. Following are main principles which apply on the channel of distribution.
1. The principle of minimum total cost of transaction :
Suppose, if goods are transferred to direct, the cost of transferring goods is Rs. 10.
But if it is purchased by channel of distribution, its cost is Rs. 2, it will be useful to reduce the cost of producers.
2. The principle of smoothness gap in assortment and sorting :
The intermediaries takes the goods and save it in store and sells it when consumer needs the goods. So, manufacturing needs intermediaries.
3. The principle of searching :
Channel of distribution creates the market of specific goods where consumer can search and buy.
4. Personal Touch
The channel of distribution close to the consumer, so they can know the needs of consumer and solve the problems of consumers.
1. The principle of minimum total cost of transaction :
Suppose, if goods are transferred to direct, the cost of transferring goods is Rs. 10.
But if it is purchased by channel of distribution, its cost is Rs. 2, it will be useful to reduce the cost of producers.
2. The principle of smoothness gap in assortment and sorting :
The intermediaries takes the goods and save it in store and sells it when consumer needs the goods. So, manufacturing needs intermediaries.
3. The principle of searching :
Channel of distribution creates the market of specific goods where consumer can search and buy.
4. Personal Touch
The channel of distribution close to the consumer, so they can know the needs of consumer and solve the problems of consumers.
Sunday, June 13, 2010
Price Setting Process
When a company develops a product, it is very necessary to set its specific price. But there are many factors which affect its setting which we can show following steps of its process.
1st Step : Selecting the Price Objectives :
We all know the price setting is the major part of marketing policy and one of P4 of marketing mix. So, it is the first in which you have to select the price object for setting it. It may be
a) Survival the product in market :
Company thinks that his product is new and for creating its position in market, company should take minimum price from its customers.
b) Maximum profit objective :
If company wants to earn maximum profit, the company can set high price under price skimming. Company thinks that if it will fix high price, no competitor faces it.
c) High market share objective :
Company's object is to increase sale. So, it will determine low price than competitors.
2nd Step : Determining the Demand :
Main aim of taking second step is to check whether our set price is best for increasing demand or not. In this step, we takes following decisions
a) Create the demand curve and check the trend :
With past records of our company's product price and past sales company can create demand curve, it shows the effect of changing price on demand of customer. The company can take the help of economist which they can explain its technical explanation. But with this, company can know whether company's price are creating bad effect on demand or good effect on demand.
b) Demand Elasticity
With this, company can estimate about how much demand is effected with increasing or decreasing the price.
3rd Step : Estimate the Costs :
For determination the price of product company should estimate the cost of product.
I) Calculate variable and fixed cost :
Fixed cost = Electricity + salary bill etc
variable cost = raw material cost + labour cost + other expenses etc.
II) Calculate differential cost in differential market :
Use activity base costing system if company sells product different time period.
III) Target Costing :
This is japan's technique
at what price consumer wants the product xxxx
Less margin = xxxx
-------------------------------------------------
Estimated price = xxxx
--------------------------------------------------
Cost must be less than estimated price
IV) Also estimate competitor's price:
4th Step : Selecting a Good Price Method :
a) Markup pricing :
Total cost price xxxx
Add % Margin on sale xxxx
----------------------------
Sale price xxxx
----------------------------
b) Perceived value price :
it is fixed on the basis of cost of market mix and margin
( product cost + advertising cost + placement cost ) + margin = fix price
c) Value Price :
Low price of quality product than competitors.
6th Step : Select the Final Price
After analysis of above five steps, marketer selects the final price of a new product.
1st Step : Selecting the Price Objectives :
We all know the price setting is the major part of marketing policy and one of P4 of marketing mix. So, it is the first in which you have to select the price object for setting it. It may be
a) Survival the product in market :
Company thinks that his product is new and for creating its position in market, company should take minimum price from its customers.
b) Maximum profit objective :
If company wants to earn maximum profit, the company can set high price under price skimming. Company thinks that if it will fix high price, no competitor faces it.
c) High market share objective :
Company's object is to increase sale. So, it will determine low price than competitors.
2nd Step : Determining the Demand :
Main aim of taking second step is to check whether our set price is best for increasing demand or not. In this step, we takes following decisions
a) Create the demand curve and check the trend :
With past records of our company's product price and past sales company can create demand curve, it shows the effect of changing price on demand of customer. The company can take the help of economist which they can explain its technical explanation. But with this, company can know whether company's price are creating bad effect on demand or good effect on demand.
b) Demand Elasticity
With this, company can estimate about how much demand is effected with increasing or decreasing the price.
3rd Step : Estimate the Costs :
For determination the price of product company should estimate the cost of product.
I) Calculate variable and fixed cost :
Fixed cost = Electricity + salary bill etc
variable cost = raw material cost + labour cost + other expenses etc.
II) Calculate differential cost in differential market :
Use activity base costing system if company sells product different time period.
III) Target Costing :
This is japan's technique
at what price consumer wants the product xxxx
Less margin = xxxx
-------------------------------------------------
Estimated price = xxxx
--------------------------------------------------
Cost must be less than estimated price
IV) Also estimate competitor's price:
4th Step : Selecting a Good Price Method :
a) Markup pricing :
Total cost price xxxx
Add % Margin on sale xxxx
----------------------------
Sale price xxxx
----------------------------
b) Perceived value price :
it is fixed on the basis of cost of market mix and margin
( product cost + advertising cost + placement cost ) + margin = fix price
c) Value Price :
Low price of quality product than competitors.
6th Step : Select the Final Price
After analysis of above five steps, marketer selects the final price of a new product.
Monday, May 10, 2010
What are Brand and branding? What are the Main Strategies of Its?
Definition of Brand of Company
Brand means name, symbol or design of the product of company. It creates difference of one company's product with other competitor company's product.
Definition of Branding of Company
Branding is technique in which company provides the name and design to each product for creating a special identity. It is helpful for consumer to identify special quality product or products in market.
Strategies of Branding of Company
Following are the main branding strategy which can be used for making and developing of new brand.
1. Brand Positioning Strategy
Brand positioning means bring the brand name of company in mind of customer. When a customer goes to market and he or she should demand of specific product. It means company is successful to position the brand in the mind of consumer. Company must be careful while positioning the brand.
a) It must not be copied from other brand.
b) Company's brand shows the benefits of products.
c) It simply convey the idea of belief and values of company.
2. Brand Name Strategy
You often see that one company's brand name are easily copied due to weakness of brand selection. For example YouTube.com video site's brand name has been copied by many other site like utube.com etc.
So be careful when you are creating the name of brand.
a) It should tell the quality of product.
b) It should be easily to pronounce, recognize and remember.
c) It should easily be translated.
d) It should be capable for legal protection.
3. Brand Sponsorship
a) National brand
Sometime, a company can spend money for marketing of company brand as nation or international basis.
b) Middle men's brand
It is private brand which is created by middlemen.
c) Licensing
Sometime, company can take the brand of other company on license basis for increasing sale.
d) Co-brand
Sometime, company can contract with other company and mix other company brand as co-brand with his products brand and sell after this.
e) Takeover the brand
Google takeover the YouTube, so, its brand is also taken over by google.
4. Brand Development
a) Main name of brand + one more line which shows the quality of product
b) Use the same famous brand in other products.
c) Multi brand - Two or more name brand of same product.
5. Brand Management
a) Brand Equity
For brand management, management calculates the estimated value of brand. It shows as brand equity. It is an asset of company. Suppose, Lux, company creates lux brand equity fund with Rs. 9000000 and utilizes it for advertising, now its brand has becomes famous. Company can calculate its estimated value and try to protect it by opening brand asset management team.
Brand means name, symbol or design of the product of company. It creates difference of one company's product with other competitor company's product.
Definition of Branding of Company
Branding is technique in which company provides the name and design to each product for creating a special identity. It is helpful for consumer to identify special quality product or products in market.
Strategies of Branding of Company
Following are the main branding strategy which can be used for making and developing of new brand.
1. Brand Positioning Strategy
Brand positioning means bring the brand name of company in mind of customer. When a customer goes to market and he or she should demand of specific product. It means company is successful to position the brand in the mind of consumer. Company must be careful while positioning the brand.
a) It must not be copied from other brand.
b) Company's brand shows the benefits of products.
c) It simply convey the idea of belief and values of company.
2. Brand Name Strategy
You often see that one company's brand name are easily copied due to weakness of brand selection. For example YouTube.com video site's brand name has been copied by many other site like utube.com etc.
So be careful when you are creating the name of brand.
a) It should tell the quality of product.
b) It should be easily to pronounce, recognize and remember.
c) It should easily be translated.
d) It should be capable for legal protection.
3. Brand Sponsorship
a) National brand
Sometime, a company can spend money for marketing of company brand as nation or international basis.
b) Middle men's brand
It is private brand which is created by middlemen.
c) Licensing
Sometime, company can take the brand of other company on license basis for increasing sale.
d) Co-brand
Sometime, company can contract with other company and mix other company brand as co-brand with his products brand and sell after this.
e) Takeover the brand
Google takeover the YouTube, so, its brand is also taken over by google.
4. Brand Development
a) Main name of brand + one more line which shows the quality of product
b) Use the same famous brand in other products.
c) Multi brand - Two or more name brand of same product.
5. Brand Management
a) Brand Equity
For brand management, management calculates the estimated value of brand. It shows as brand equity. It is an asset of company. Suppose, Lux, company creates lux brand equity fund with Rs. 9000000 and utilizes it for advertising, now its brand has becomes famous. Company can calculate its estimated value and try to protect it by opening brand asset management team.
Sunday, May 9, 2010
What is Product Mix?
Product mix is the set or group of products which a particular company offers to public. Product mix is very helpful for taking advantage one product brand benefit for selling other product. For example:
Godrej Agrovet division has following product mix:
a) animal feeds
b) agricultural inputs
c) horticulture
d) tissue culture
e) retailing
Godrej Agrovet division has following product mix:
a) animal feeds
b) agricultural inputs
c) horticulture
d) tissue culture
e) retailing
What is Product Life Cycle? What are its main stages? What strategies will you follow in these stages?
Product life cycle shows the different stages in which it lives his life just as human being. A human being enjoys childhood, youth age and old age and after this, it is sure he will die. Same thing happens with all products. Product life cycle has four parts. In first stage introduction, second stage is stage of growth, third is the stage of maturity and in the end stage is decline. After this, value of product is totally dropped from market due to invention of new product. We can portray its sketch on the graph paper. Its shape will be bell shape.
Its strategies are divided in Four stages according to life of product.
Ist Stage
Introduction stage of Product life cycle
First stage of plc is called introduction stage. In this stage, product is newly developed and launched in the market. Because, consumer does not know about this product earlier, so its marketing is very difficult. Marketer has to teach the consumers about its benefits and its advance facilities . For new product's introductory stage, marketer can take the market with marketing skimming strategy or marketing penetration strategy. One more feature of this stage that company sale will be low.
2nd Stage
Growth stage of Product life cycle
In this stage, consumer knows the product because he has taken past experience after purchasing it at introductory stage. So, sale will increase. In this stage, company can increase the price for getting old promotion and advertising cost. Company can pay more on advertising for developing product brand image in the minds of consumers. In this stage company's profit will also rise.
3rd Stage
Maturity
At this stage product life cycle, our sale reaches at highest level. Product is become well known in the market. In this stage, we have to decrease our price for taking maximum part of product and defeating market competitors. Company can offer special discount to dealer for selling fast before reaching it declining stage.
4th Stage
Decline Stage
At this stage, sales fall very sharply. No more new customer wants to buy it . At this stage, company can offer public to switch to his new advance product. Company can take milk from brand name without any new advertising cost.
Saturday, May 8, 2010
Stages in Developing New Product
Before describing the stages in developing the new product in marketing mix, we will define the product with following way
Definition of Product
Product is the tangible and intangible things which satisfy the needs of consumers. It means not only physical things which we purchase are the products but all the services of other persons are also product. For example TV, computer, watch, food, house and Taxi driver's services are also products which we can purchase and satisfy our needs.
Following are the seven stages or steps in development of a new product
Ist stage
Idea generation
Idea generation is the first stage of product development. For developing a product, company takes the idea from his internal and external sources.
internal sources of idea generation
a) basic research on google b) idea from production department c) sales men's idea d) top management's idea
external sources of idea generation
a) business magazine b) competitors c) necessity of consumers c) inventor's idea
*
Idea should be helpful for satisfying consumer's need, other wise drop the idea. For taking second step ask from yourself, is it worth considering - if yes, then take second step
2nd Stage
Idea Screening
It is the second stage or step of development of new product. After collecting large number of idea for making new product, company will analyze them with his technical screening system or team and drop bad idea. Idea screening is helpful
a) to reduce the chance of development of product on the basis of poor idea.
b) to reduce the chance of not developing the product on the basis of very good idea.
*
Technical base of idea screening
Company can enumerate his employees to make check list for idea screening.
value of idea
basis of screening
good idea - should be selected
bad idea - should not be selected
3rd Stage
Laboratory Test
This is the third stage of development of new product. In this step, we test the product's development with in company before actual launch in the market for following purpose.
a) To know
whether our buyer will buy it or not?
b) To know
whether it will be suitable for consumer according to their need of product?
* Company can also use computer for lab testing.
4th Stage
Marketing strategy development
In this stage, company makes following planning for good product development
a) first year market budget - cost
b) estimate first year profit
c) value of sales and profit after one year.
5th Stage
Business Analysis
This is the fifth stage of development of new product. In this stage, company calculate his overall return on investment, if company will launch the product. If it is profitable, company will produce it otherwise, drop his plan because company's money is not money of one man or employee but this money is invested by large number of investors. So, board of directors can not waste it by unprofitable production of new product. For calculating this, they will analyze
a) demand b) cost c) profitability
6th Stage
Actual Product development
After this, company's R and D department produces one or two sample of products and check it.
7th Stage
Market Test
In this step or stage, company launches product in very small part of market as market test and for knowing the interest of consumers, dealers and retailers. If consumers' reaction are good, company will take the next action.
8th Stage
Commercialization
In this step, company manages large scale production, marketing and commercialization of new product with following marketing strategy.
a) when to produce - fix the time
b) where to produce - fix the geography
c) to whom to sell - target marketing strategy
d) How - Brand Strategy.
Definition of Product
Product is the tangible and intangible things which satisfy the needs of consumers. It means not only physical things which we purchase are the products but all the services of other persons are also product. For example TV, computer, watch, food, house and Taxi driver's services are also products which we can purchase and satisfy our needs.
Following are the seven stages or steps in development of a new product
Ist stage
Idea generation
Idea generation is the first stage of product development. For developing a product, company takes the idea from his internal and external sources.
internal sources of idea generation
a) basic research on google b) idea from production department c) sales men's idea d) top management's idea
external sources of idea generation
a) business magazine b) competitors c) necessity of consumers c) inventor's idea
*
Idea should be helpful for satisfying consumer's need, other wise drop the idea. For taking second step ask from yourself, is it worth considering - if yes, then take second step
2nd Stage
Idea Screening
It is the second stage or step of development of new product. After collecting large number of idea for making new product, company will analyze them with his technical screening system or team and drop bad idea. Idea screening is helpful
a) to reduce the chance of development of product on the basis of poor idea.
b) to reduce the chance of not developing the product on the basis of very good idea.
*
Technical base of idea screening
Company can enumerate his employees to make check list for idea screening.
value of idea
basis of screening
good idea - should be selected
bad idea - should not be selected
3rd Stage
Laboratory Test
This is the third stage of development of new product. In this step, we test the product's development with in company before actual launch in the market for following purpose.
a) To know
whether our buyer will buy it or not?
b) To know
whether it will be suitable for consumer according to their need of product?
* Company can also use computer for lab testing.
4th Stage
Marketing strategy development
In this stage, company makes following planning for good product development
a) first year market budget - cost
b) estimate first year profit
c) value of sales and profit after one year.
5th Stage
Business Analysis
This is the fifth stage of development of new product. In this stage, company calculate his overall return on investment, if company will launch the product. If it is profitable, company will produce it otherwise, drop his plan because company's money is not money of one man or employee but this money is invested by large number of investors. So, board of directors can not waste it by unprofitable production of new product. For calculating this, they will analyze
a) demand b) cost c) profitability
6th Stage
Actual Product development
After this, company's R and D department produces one or two sample of products and check it.
7th Stage
Market Test
In this step or stage, company launches product in very small part of market as market test and for knowing the interest of consumers, dealers and retailers. If consumers' reaction are good, company will take the next action.
8th Stage
Commercialization
In this step, company manages large scale production, marketing and commercialization of new product with following marketing strategy.
a) when to produce - fix the time
b) where to produce - fix the geography
c) to whom to sell - target marketing strategy
d) How - Brand Strategy.
Thursday, October 29, 2009
How to design a questionnaire
Labels:
business concepts,
business studies,
GCSE,
marketing,
marketing research,
questionnaire
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The most common research instrument is the questionnaire. Poorly designed questionnaires do not uncover the information you are seeking. Pretest any question with a few people to see which questions are being misunderstood or are not effective in drawing out the type of response you are interested in.Keep these tips in mind when designing your market research questionnaire.
- Keep it simple.
- Include instructions for answering all questions included on the survey.
- Begin the survey with general questions and move towards more specific questions.
- Keep each question brief.
- If the questionnaire is completed by the respondent and not by an interviewer or survey staff member, remember to design a questionnaire that is graphically pleasing and easy to read.
Read more of this article at dineshbakshi.com and find additional business studies, economics and accounting revision notes
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