Introduction and Marketing


Market:-Refers to a set of actual and potential buyers of a product or service.

Marketer:-Who takes an active part in the process of exchange

  • Seller examines the needs of the possible buyers, develops a market offering, and motivates the buyers to buy the product
  • In situations of rare supply, the buyer may be taking extra efforts in persuading the seller to sell the product.


  1. Gathering and Analyzing Market Information:
  • Begins with planning and designing a product for the consumers.
  • Includes collecting and analyzing information regarding customer needs and buying habits, the nature of competition in the market, prevailing prices, distribution network, effectiveness of advertising media, etc
  1. Standardization and Grading:
    • Refers to producing goods of fixed specifications, which helps in achieving consistency in the output. Increasing consumers’ confidence in the product quality.
    • Process of classification of products into different groups such as quality, size, etc.
  2. packaging and Labeling:
    • protects the product from leakages, spoilage, moisture, heat, and mishandling and adds value and life to the product
    • Designing the label to be put on the package. The label may vary from simple tags to complex graphics.
  3. Branding:
    • Name, term, symbol, or combination of all these which uniquely identify the products
    • Creates a corporate brand identity for consumer
  4. Customer Support Services:
    • Customer support services such as after-sales services, handling customer complaints, and obtaining credit services for the satisfaction of the customers.
  5. Pricing of Products:
    • Generally, the lower the price, the higher would be the demand for the product and vice-versa.
    • The marketers have to properly analyze the factors determining the price of a product and take several crucial decisions in this respect.
  6. Promotion:
    • Promotion of products and services involves informing the customers about the firm’s product, its features, etc., and persuading them to purchase these products.
    • Four important methods include advertising, Personal Selling, Publicity, and Sales Promotion.
  7. Physical Distribution
    • Include decisions regarding channels of distribution or the marketing intermediaries (like wholesalers, retailers) to be used
    • The physical movement of the product from where it is produced to a place where it is required by the customers for their consumption.
  8. Transportation:
  • Involves physical movement of goods from one place to the other.
  • On the basis of the nature of the product, the cost involved, urgency, nature of the goods, etc. suitable means of transportation can be selected
  1. Storage and Warehousing:
  • Wide gap between the production and actual sale of goods.
  • Involves making suitable arrangements for preserving the goods till they are bought by the consumers
  • Finished goods may be required to be stored for a period when demand is expected to rise.

Marketing Management


Marketing is finding out what people want and creating products, services, or ideas according to the needs of the consumers.

Market Management

  • Is the art and science of choosing target markets and getting, keeping, and growing customers through creating, delivering, and communicating superior customer value?


  1. Identification of Need to identify the needs of the target customers and develop products and services that satisfy such needs.
  2. Creating a Market Offering: Refers to a complete offer for a product having features like size, quality, taste, etc. at a certain price.
  3. Customer Value: Add value to the product so that the customers prefer it in relation to the competing products and decide to purchase it. Warranty, After-sale services, free home delivery
  4. Exchange Mechanism: Process through which two or more parties come together to obtain the desired product or service from someone giving something in return.



Marketing Mix


Set of four controllable variables (Popularly known as, product price, place, and promotion) which marketer uses in the best possible manner to achieve its marketing objectives.



Concerned with transferring the goods and services available at the right place and right time so that customers can purchase the same.


  • Physical Distribution
  • Channels of Distribution`

Refers to a team of merchants, agents and business institutions that combine physical movement and title movement of products to reach the producers to the consumers.

Product Mix


  1. Product is a mixture of tangible and intangible attributes, which are capable of being exchanged for a value, with the ability to satisfy customer needs.

Include services, ideas, persons, and places.

Three types of benefits for a customer from the product

  • Functional benefits

            Car provides the functional utility of transportation

  • Psychological benefits

            Satisfies the need for prestige and esteem

  • Social benefits.

            Acceptance from a group

Branding: Branding is a name, term, symbol, or combination of all these which uniquely identify the products and create a corporate brand identity for the consumer. Two components—brand name and brand mark.

    1. Brand Name: Part of a brand, which can be spoken, is called a brand name. For example, Asian Paints, SONY Maggie.
    2. Brand Mark: Part of a brand that can be recognized but which is not able to express. Appears in the form of a symbol, design, for Example, the tiger on Britannia biscuits

Trade Mark: A brand or part of a brand that is given legal protection is called a trademark.

Advantages to the Marketers

  1. Product Differentiation: Helps a firm in differentiating its product from that of its competitors. This enables the firm to secure and control the market for its products. Example Sony, Samsung, Nokia.
  2. Advertising and Display Programmers: Without a brand name, the advertiser can only create awareness for the product and branding increases the sale of the product.
  3. Introduction of New Product becomes easy: If a new product is introduced under a known brand, it enjoys goodwill and can get a good start.
  4. Differential Pricing: enables a firm to charge a higher price for its products than its competitors. Nokia, Sony charge higher prices than their competitors

Advantages to Customers

  1. Status Symbol: Some brands have become status symbols because of their quality. The consumers feel proud and improve their satisfaction level. Like Puma, Nokia
  2. Ease in shopping: Satisfied customer with a particular brand of a product, customer need not make a close check every time.
  3. Ensures Quality: Branding means quality. Customer is always confident about the quality McDonald's, Haldiram

Characteristics of Good Brand

  1. Suggestive it should suggest the product’s benefits and qualities. It should be appropriate to the product’s function. E.g. Boost. Sunsilk, Hajmola.
  2. Continuing Chosen name should have staying power i.e., it should not get out of date. Lifebuoy( more than 125 years)
  3. Adaptable should be suitably flexible to hold new products, which are added to the product line e.g., nestle, Samsung.
  4. Registration should be capable of being registered and protected legally.
  5. Easy to spell  should be short, easy to pronounce, spell, recognize and remember e.g., Ponds, VIP, Rin, Vim, etc
  6. Disincentive A brand name should be distinctive e.g., GOOGLE, Sprit, MICROSOFT,LG

Packaging: - anything which protects the product from leakages, spoilage, moisture, heat, and mishandling and adds value and life to the product

Levels of Packaging

  1. Primary Package:
  • Refers to the product’s immediate container.
  • Ready to use the product (e.g., plastic packet for socks);
  • Used throughout the entire life of the product (e.g., toothpaste tube, a matchbox, etc.).
  1. Secondary Packaging:
  • additional layers of protection that are kept till the product are ready for use, e.g., a tube of shaving cream
  1. Transportation Packaging:
  • Further packaging components are necessary for storage, identification, or transportation. For example toothpaste in cardboard boxes containing 10, 20, or 100 units.

Importance of Packaging

  1. Self-Service Outlets: Self-service retail outlets are becoming very popular, particularly in major cities and towns. Example reliance fresh, easy day, etc.
  2. Increasing Standards of Health and Sanitation: standards of living in the country are increasing, and more and more people have started purchasing packed goods as the chances of adulteration in such goods are less.
  3. Innovational Opportunity: packaging has completely changed the marketing scene in the country. milk can now be stored for 4-5 days, traveling pouches of  paste, tea, sugar, coffee, canned juices
  4. Product Differentiation, by looking at the package of a product customers can guess about the quality of the product contained in it.

Functions of Packaging

  1. Product usage: The size and shape of the package should be such that it should be convenient to open, handle and use for the consumers. 
  2. Identification: Colgate in red color or Ponds cream jar can be easily identified by its package.
  3. Promotion: color schemes, photographs, or typeface may be used to attract the attention of the people at the point of purchase. In self-service stores, this role of packaging becomes all the more important.
  4. Enables Protection: protects the contents of a product from spoilage, breakage, leakage, pilferage, damage, climatic effect, etc. This kind of protection is required during storing, distribution, and transportation of the product.

Labeling: - Part of the product that carries information about the product, its contents, method of use, seller, etc.


  1. Promotion of Products: Attractive labels can attract customers and can increase sales. For example the label on the soft drink‘20% Extra Free.
  2. Required Information By Law: For example, the statutory warning on the package of Cigarettes or Pan Masala, ‘Smoking is Injurious to Health’
  3. Identification of the Product: Labels help to identify the product or brand on its package from many products also including the name and address of the manufacturer.
  4. Describe the Product and Specify its Contents. Describe the product, its usage, cautions in use, etc. and specify its contents, MRP, expiry date, manufacturing date, batch number, etc.
  5. Enables grading of products: Grading the products into different categories. Different type of milk is sold by Amul brands under Red( full cream), blue (single tone) yellow(double tone)

Price Mix


Price is the monetary sacrifice of a product. Price mix refers to the decisions relating to the price charged for the product.

Determination of the Price of a Product is influenced by many factors.

  1. Pricing Objectives:
  • Competitive Market: to survive at competitive market prices has to keep low
  • Attaining Product Quality Leadership: normally higher prices are charged to cover high quality and high cost of Research and Development.
  • Obtaining Market Share Leadership: If a firm's objective is to obtain a larger share of the market; it will keep the price of its products at a lower
  1. The extent of  Competition: Apart from these internal considerations, external factors such as prices of similar products in the market, govt.-policy, etc. should also be considered
  2. Total Cost of production: Sales price = total costs + desired profit. No firm likes to sell its product below the total cost of the product.
  3. Demand for the product: If there is less demand for the product, it will not sell at a very high price. Demand should be predicted correctly before setting the price.
  4. Other marketing methods Used: The price fixation process is also affected by other elements of marketing such as distribution system, quality of salesmen employed, quality and amount of advertising, sales promotion efforts, the type of packaging, credit facility, and customer services provided.
  5. Government and Legal Regulations: to protect the interest of the public against unfair practices Government can declare certain products as essential products and regulate their price.(petrol, diesel, LPG)

Channels of Distribution


Types of Channels

Direct Channel (Zero Level)

  • Most simple and shortest mode of distribution
  • Goods are made directly available by the manufacturers to customers, without involving any intermediary
  • Mail order selling, internet selling and selling through own sales force, (e.g., Eureka Forbes).

Indirect Channels

When a manufacturer employs one or more intermediaries to move goods from the point of production to the point of consumption

  1. Manufacturer-Retailer Consumer(One Level Channel):
      1. One intermediary i.e., retailers is used between the manufacturers and the customers.
      2. Maruti Udyog
  2. Manufacturer-Wholesaler-Retailer-Consumer (Two-Level Channel):
      1. Wholesalers and retailers act as connecting links between the manufacturer and consumer.
      2. Consumer goods like soaps, clothes, rice,
  3. Manufacturer-Agent-Wholesaler-Retailer-Consumer (Three Level Channels):
      1. Manufacturers use their selling agents or brokers who connect them with wholesalers and then the retailers.

Factors Determining Choice of Channels

1. Product Related Factors:

  • Industrial products/consumer product is
    • Usually technical, made on order, and expensive products purchased by few buyers.   short channels
    • Consumer products usually standardized, less expensive, frequently bought products. by long channels
  • Unit value
    • Value of a product is low long channels
    • High-value products, shorter channels
  • Nature of products
    • Complex products require technical details as in the case of most industrial or engineering products, short channels
    • Simple Products sold through a long channel
  1. Related to Company’s

    Financial strength

    • Direct selling involves a lot of funds in fixed assets that can be used only by the financial sound company (reliance on the fresh, easy day)

Degree of Control

    • Greater control on the channel members, short channels are used (Bata India)
    • Less control over the middlemen longer channel (Colgate, nestle)

3. Issue Regarding Competitors

  • Go In line with the competitors (Maruti, Tata Motors, Hyundai)
  • Use Different lines from competitors( dell laptop sales through direct selling)
  1. Market Factors:
  • No of buyers
  • Number of buyers is small, industrial products, short channels
  • Number of buyers is large, soft drinks, toothpaste etc., longer channels
  • Size of order
  • Order is small, for example consumer products, longer channels
  • Size of the order is large, with short channels.

5. Environmental Factors:

  • Economic condition
  • Depressed economy marketers use shorter channels to reduce the cost due to limited sales
  • Legal constraints:-Govt may fix certain channels(petrol pumps)

Physical Distribution: - Activities required to physically move goods from manufacturers to the customers.

Creates place utility and time utility by the provision of goods at the appropriate place and at the appropriate time

Activities involved in physical distribution
  1. Transportation (movement of goods):
    • Helps in the movement of goods from the place of production to the place of consumption
    • There are various means of transportation i.e., rail, road, air, pipeline, water transport, etc.
    • Modes are evaluated and compared based on speed, frequency, flexibility, and cost, and the best-suited mode is selected by the company.
  2. Stock/Inventory:
    • Inventory refers to the maintenance of a stock of goods. The inventory needs to be maintained so that goods can be supplied whenever demanded.
    • The firm must consider the benefits of inventory and the cost involved and accordingly, the optimum level of inventory should be maintained.
  3. Warehousing:
    • Whatever is produced is not sold off immediately. Therefore every company needs to store the finished goods until they are sold in the market.
    • Storage of goods is necessary because some goods like crops are seasonal in production.
  4. Order processing:
  • The time and steps involved between taking order from customer and delivery of goods as per order.
    • There is a direct relationship between the time taken in order processing and the satisfaction of customers.
    • Fast order processing gives more satisfaction to customers (Dominos 30 minutes home delivery)

Promotion Mix


An Element marketing mix Refers to a combination of promotional tools

      • Sales Promotion
      • Advertising,
      • Personal Selling,
      • Public relations

Can be used in different combinations, to achieve its communication objectives of

  • Reminding is used for mature products since it keeps consumers thinking about the product
  • Informing potential customers used to inform consumers about a new product
  • Persuading them to buy, to tell the superiority of the product over its competitors

Advertising:-Impersonal, paid form of communication by the identified sponsor to promote some goods or service through common modes of some channels like ‘newspapers’, ‘magazines’, ‘television’, and ‘radio’.


  1. Paid Form: sponsor has to bear the cost to be paid to various channels of communications
  2. Information: informs the buyers about the benefits they get when they purchase a particular product.
  3. Identified Sponsor: A sponsor may be an individual or a firm that pays for the advertisement. The name of a reputed company may increase sales of products
  4. Non-Personal Presentation: advertising is non-personal.  There is the absence of personal appeal in advertising.

Role of Advertising in Business

  • Research: Motivates firm for research and development activities to find new products and or add value to the existing products. Example mobile firm keeps on adding new features.
  • Ease in Introduction of New Product: A firm can introduce itself and its product to the public through advertising. A new enterprise can't make an impact on possible customers without the help of advertising.
  • Provide employment: Advertising provides direct employment to a large number of people engaged in both electronic and print media
  • Enables Mass Production: Mass production reduces the cost of production per unit by the economical use of various factors of production.
  • Advance standard of living: Convince people to consume the latest things and thereby improves their standard of living.
  • To Promotion Sales: Promotes the sale of products by informing and persuading the people to buy them and helps in winning new customers and maintaining existing customers
  • Support to media: Provides an important source of revenue to the publishers and magazines. It enables them to increase the circulation of their publication by selling them at lower rates.

Personal selling: - Face-to-face communication between a seller and buyer. It involves an oral presentation by salespersons to one or more prospective buyers to make sales.

Features of Personal Selling

  1. Personal Form: direct face-to-face dialogue takes place that involves an interactive relationship between the seller and the buyer.
  2. Development of Relationship: this allows a salesperson to develop personal relationships with the likely customers.

Qualities of good salesmen

  1. Mentally healthy: Should possess certain mental qualities like imagination, initiative, self-confidence, sharp memory, alertness, etc. able to understand the needs and preferences of customers.
  2. Understanding: Should have a sense of understanding to convince the customers to buy. He must persuade the customer to finalize the purchase with a sense of satisfaction.
  3. Flexibility in approach: Should interact with customers with a flexible approach i.e., try to persuade different types of customers for different reasons.
  4. Full Knowledge of the product and the company: should have full knowledge of the product and the company he is representing. He should be able to explain every feature of the product.
  5. Inspired to trust: Should be co-operative and courteous. He should not feel irritated if the buyer puts up many questions even if the questions are irrelevant.
  6. Notable personality and sound health: Should have a good build and be well dressed.  Customers will be impressed by the salesman’s pleasing personality. He is to travel therefore should have good health.
  7. Superior communication skills: Should be good in conversations and able to convince customers and create the need in his mind of the customer.



Sales promotion

Refers to short-term incentives, which are designed to encourage the buyers to make immediate purchases of a product or service to boost the sales of a firm.

Methods of sales promotion

  1. Rebate:
  • Under it to clear the excess stock, products are offered at some reduced price.
  • For example, giving a rebate by a car manufacturer to the tune of 12,000/- for a limited period.
  1. Discount:
  • Under this method, the customers are offered products at less than the listed price.
  • For example, giving a discount of 30% on the sale of Liberty Shoes. Similarly giving a discount of 50% + 40% by the KOUTONS.
  1. Refunds:
    • Under this method, some part of the price of an article is refunded to the customer on showing proof of purchase.
    • This is commonly used by food product companies, to boost their sales.
    • For example, refunding an amount of 5/- on showing the empty packet of the product price 100/-.
  2. Product Combination: Under this method, along with the main product some other product is offered to the customer as a gift. The following are some examples:
    • Offer of a pack of ½ kg of rice with the purchase of a bag of Atta (wheat flour),
    • Get 128 KB Memory Card Free with a Digi cam’ or Buy a TV of 25+ and Get a Vacuum Cleaner Free
  3. Quantity Gift:
    • Under this method, some extra quantity of the main product is passed on as a gift to the customers.
    • For example, 25% extra toothpaste in a packet of 200 gm toothpaste. Similarly, a gift of one RICH LOOK shirt on the purchase of two shirts.
  4. Instant Draw and Assigned Gift:
    • Under this method, a customer is asked to scratch a card on the purchase of a product and the name of the product is inscribed thereupon which is immediately offered to the customer as a gift.
    •  For example, on buying a car when the card is scratched such gifts are offered – TV, Refrigerator, Computer, Mixer, Dinner Set, Wristwatch, T-shirt, Iron Press, etc.
  5. Lucky Draw:
    • Under this method, the customers of a particular product are offered gifts on a fixed date and the winners are decided by the draw of lots.
    •  While purchasing the product, the customers are given a coupon with a specific number printed on it. Based on this number alone, the buyer claims to have won the gift.
    • For example, the ‘Buy a bathing soap and get a gold coin’ offer can be used under this method.
  6. Usable Benefits:
    • Under this method, coupons are distributed among the consumers on behalf of the producer. A coupon is a kind of certificate telling that the product mentioned therein can be obtained at a special discount.
    •  It means that if a customer has a coupon for some product he will get the discount mentioned therein whenever he buys it. Possession of a coupon motivates the consumer to buy the product, even when he does not need it.
    • Such coupons are published in newspapers and magazines.
  1. Full Finance @ 0%:-
    • Under this method, the product is sold and money is received in installments at a 0% rate of interest.
    • The seller determines the number of installments in which the price of the product will be recovered from the customer.
    • No interest is charged on these installments.
  2. Samples or Sampling:-
  • Under this method, the producer distributes free samples of his product among the consumers. This method is used mostly in the case of products of daily use, e.g., Washing Powder, Tea, Toothpaste, etc.
  • Thus, the consumers willy-nilly make use of the free sample. If it satisfies them, they buy it and in this way, sales are increased.
  1. Contests:
    • Some producers organize contests with a view to popularizing their products.
    • Consumers taking part in the contest are asked to answer some very simple questions on a form and forward the same to the company.
    • Result is declared on the basis of all the forms received by a particular date

Public Relations Tools

Meaning - involves a variety of programs to promote and protect a company’s image or its products to strengthen relations with various stakeholders like customers, shareholders, employees, suppliers, investors, etc.

Public relations help in achieving the following marketing objectives:

  1. Building awareness: Public relations department can place stories and dramatize the product in the media. This will build marketplace excitement before the product reaches the market or media advertising takes place. This usually creates a favorable impression on the target customer.
  2. Building credibility: If news about a product comes in the media whether print or electronic it always lends credibility and people believe in the product since it is in the news.
  3. Stimulates sales force: It becomes easier for the sales force to deal with the retailers and convince dealers if they have already heard about the product in the news before it is launched. Retailers and dealers also feel it is easier to sell the product to the ultimate consumer.
  4. Lowers promotion costs: Maintaining good public relations costs much less than advertising and direct mail. However, it requires a lot of communication and interpersonal skills to convince the media to give space or time for the organization and its product.

The public relations department performs five functions:

  1. Press relations:
    • Information about the organization needs to be presented in a positive manner in the press.
    • Generating news requires skill in developing and researching a story and getting the media to accept press releases is a difficult task.
    • The public relations department is in contact with the media to present facts and a correct picture of the company.
  2. Product publicity:
    • New products require special effort to publicize and the company has to sponsor such programs.
    • The public relations department manages the sponsoring of such events.
    • The company can draw attention to new products by arranging sports and cultural events like news conferences, seminars, and exhibitions.
  3. Corporate Communication:
    • The image of the organization needs to be promoted through communicating with the public and the employees within the organization.
    • This is usually done with the help of a newsletter, annual reports, brochures, articles and audio-visual materials. Companies rely on these materials to reach and influence their target markets.
    • Speeches by the company’s executives at a meeting of trade associations or trade fairs can boost the company’s image.
  4. Lobbying:
    • The organization has to deal with government officials and different ministers in charge of corporate affairs, industry, and finance with respect to policies relating to business and the economy.
    • The government also wants to maintain a healthy relationship with associations of commerce and industry while formulating industrial, telecom, taxation policies, etc.
    • The public relations department then has to be positive in promoting regulations that affect them.
  5. Counseling:
  • The company can build goodwill by contributing money and time to certain causes like the environment, wildlife, children’s rights, education, etc.
  • Such cause-related activities help in promoting public relations and building goodwill.