Identify and explain the promotional tool of Marketing-mix which plays a persuasive, service and informative role and thereby link a business firm to its customers. Also explain by giving any four reasons how this tool helps in increasing the sales of businessmen.
The promotional tool of marketing mix which plays a persuasive, service and informative role and links a business firm to its customers is personal selling. Personal selling involves oral presentation of message in the form of conversation with one or more prospective customers for the purpose of making sales.
Personal selling is a powerful tool which helps to increase the sales of businessmen. The importance of personal selling to a business organisation may be described as follows:
(i) Effective Promotional Tool: Personal selling is a very effective promotional tool, which helps in influencing the prospects about the merits of a product and thereby increasing its sale.
(ii) Flexible Tool: Personal selling is more flexible than other tools of promotion such as advertising and sales promotion.
(iii) Minimizes Wastage of Efforts: Compared with other tools of promotion, the possibility of wastage of efforts in personal selling is minimum. This helps the business persons in bringing economy in their efforts.
(iv) Consumer Attention: There is an opportunity to detect the loss of consumer attention and interest in a personal selling situation. This helps a business person in successfully completing the sale.
Mediquip Ltd. is a company dealing in distribution of medical equipments. The company recently imported 15000 units of sugar testing machines to test the sugar levels without taking blood samples. For deciding the marketing strategy, the Chief Executive Officer of the company called a meeting of the marketing heads of different zones. In the meeting, Sandeep, the North Zone Marketing Head, suggested that since the machines were sophisticated they need to visit hospitals personally, to explain its working to the hospital staff who would be using the machines. He also suggested that additional trained people may be recruited for the same. Himanshu, another Zonal Head, added that since lot of money
had been spent on the import of the machines, the company was short of funds to pay to the additional staff as suggested by Sandeep. Rahul, a newly appointed Zonal Head of South Zone suggested that since the size of the order is not large, a detailed study of the factors determining the choice of channels of distribution is required before making the right choice.
(a) Identify the factors influencing the choice of channels of distribution which were discussed in the meeting.
(b) Also, explain briefly the other consideration to be taken care of in each factor identified in part (a).
(a) Factors influencing the choice of channels of distribution are:
i. Product related factors- As discussed in the paragraph ‘Machines were sophisticated they need to visit hospitals personally to explain its working to the hospital staff who would be using the machines.’
ii. Company characteristics- ‘The company was short of funds to pay the additional staff.’
iii. Market factors- “Size of the order was not large.’
(b) Consideration to be taken care in each factor would be:
i. Product-related factors- The decision regarding the channel of distribution largely depends upon the type of product. In this case, Machines are complex products requiring technical details. Thus, shorter channels of distribution would be more suitable.
ii. Company characteristics- The financial strength of the company determines the channel of distribution that can be used by it. Company which has a good financial strength should opt for Shorter channels of distribution. they can deploy spare funds in distribution and employing salesman, opening a different number of outlets etc. However, in the given case, the company is short of funds and thus would opt for indirect channels of distribution. Similarly, companies with shorter funds can choose longer channel of distribution and companies which have lesser control over their intermediaries can go for longer channel.
iii. Market factors- Factors such as the size of the market, present demand, changing the environment, geographical concentration of buyer also affects the choice of the distribution process.For example the if size of the order is small, the company should go for small channel of distribution and if order size is large then it should go with the larger channel of distribution.
Sunita took her niece, Aishwarya for shopping to ‘Benetton’ to buy her a dress on the occasion of her birthday. She was delighted when on payment for the dress she got a discount voucher to get 20% off for a meal of ` 500 or above at a famous eating joint. Identify the technique of sales promotion used by the company in the above situation.
The company used the usable benefits technique of sales promotion.
Ginika, Tanish and Rohit were friends from college days and now they are doing different kinds of business. They regularly meet and discuss their business ideas and exchange notes on customer satisfaction, marketing efforts, product designing, selling techniques, social concerns etc. In one of such meetings, Ginika drew the attention of Tanish and Rohit towards the exploitation of consumers. She told that most of the sellers were exploiting the consumers in various ways and were not paying attention towards the social, ethical and ecological aspects of marketing, whereas she was not doing so.Tanish told that they were under pressure to satisfy the consumers, but stated that the consumers would not buy or not buy enough unless they were adequately convinced and motivated for the same. Rohit stressed that a company cannot achieve its objectives without
understanding the needs of the customers. It was the duty of the businessmen to keep consumer satisfaction in mind because business is run by the resources made available to them by the society. He further stated that he himself was taking into consideration the needs of the customers. Identify the various types of thinking that guided Ginika, Tanish
and Rohit in the marketing efforts of their business. Also, state one more feature of the various types of thinking identified that is not given in the above para.
The following are the various types of thinking that guided Ginika, Tanish and Rohit in the marketing efforts of their business.
i. Societal marketing concept- According to the societal concept of marketing, an organisation should not only meet the demands of target market but also aim at consumer well-being and Interest. In addition, other aspects of consumer well-being (namely ecological, ethical and social) must be taken into consideration by the organisation.
ii. Selling concept- As per selling concept, customers would not buy or not buy enough unless they are adequately convinced and motivated for the same. In order to sell the products, products should be aggressively promoted. In this regard, the organisation should highly focus on their promotion mix strategies advertising, personal selling and sales promotion techniques can be used by the organisation.
iii. Marketing concept- According to the marketing concept of marketing management, the primary focus of business should be on customer satisfaction. A business must identify the target customer and satisfying their needs better than the competitors. Then only it can survive in the long run if it works effectively towards customer satisfaction.
Name the element of Marketing-mix in which a set of firms and individuals creates possession, place and time utility and helps in market offering. Also explain any five important functions performed by this element.
The element of marketing mix that creates possession, place and time utility is Place or Physical Distribution mix. It includes activities that make firm’s products available to the target customers. Important decision areas in this respect include selection of dealers or intermediaries to reach the customers, providing support to the intermediaries.
Important functions performed by physical distribution mix are:
1. Sorting: Middlemen procure supplies of goods from a variety of sources, which is often not of the same quality, nature, and size. So he sorts the product into homogenous groups on the basis of the size or quality.
2. Accumulation: This function involves accumulation of goods into larger homogeneous stocks, which help in maintaining continuous flow of supply.
3. Allocation: Allocation involves breaking homogenous stock into smaller, marketable lots.
4. Assorting: Middlemen build assortment of products for resale. There is usually a difference between the product lines made by manufacturers and the assortment or combinations desired by the users. Middlemen procure variety of goods from different sources and deliver them in combinations desired by customers.
5. Product Promotion: Mostly advertising and other sales promotion activities are organised by manufacturers. Middlemen also participate in certain activities such as demonstrations, special displays, contests, etc., to increase the sale of products.
Switch
