IGNOU ASSIGNMENT SOLUTIONS
MASTER OF COMMERCE (MCOM - SEMESTER 2)
MCO-06 - MARKETING MANAGEMENT
MCO-06/TMA/2022-2023
Please Note:
These assignments are valid for two admission cycles (July 2022 and January 2023). The validity is
given below:
1. Those who are enrolled in July 2022, it is valid upto January 2023. (Term End Examinations in December 2022)
2. Those who are enrolled in January 2023, it is valid upto December 2023. (Term End Examinations in June 2023)
Question No. 1
What do you mean by Buyer Behavior? Discuss various social and Cultural factors
which influence the buyer behavior?
(20 Marks)
Solution:
Buyer Behaviour simply means the decision and acts pursued by any buyer while purchasing any product or service. Another term for buyer behavior that is majorly used in the market of digital monetization is “consumer buying behavior,”.
It is the highlighted driving force behind any marketing campaign. But how it can benefit you or your business or why should you even care what is buyer behavior? The following reasons will make the significance of buyer behavior supremely certain:
- Buyer Behaviour helps you understand the dynamics behind any purchase done by the consumer regarding a wide range of products.
- It reveals substantial reasons behind the loyalty of consumers, for a specific brand or product.
- Also, it helps you in analyzing & predicting the demand of any service or product prior to its launch.
- Moreover, is the wizard’s wand when it comes to generating influential marketing campaigns.
- In addition to that, it makes your product or services more engaging & relatable to the target audience.
- We are social beings, and we always want to be around a group of people. There a few groups of people who are always around us, and they have a direct or indirect influence on our behaviour and attitudes. These are called the Reference Groups.
- Don't most of us used to want the bicycle that our friends used to have in our childhood? A few groups like family, friends, colleagues; with whom we interact regularly are called the Primary Groups.
- On the other hand, we have few groups with whom we interact less and conversations are required to be formal; these groups are called the Secondary Groups. But how do these groups influence our behaviour as a consumer?
- The below mentioned three points will answer this better:
- Let's say, most of the times you get to know about the latest cool gadgets from your friends and colleagues only; this means that they expose us to new behaviours and lifestyle.
- Now, you also need to have the same product. Hence, they influence our behaviour and self-image.
- You want to buy that cool gadget from a few specific brands only; they create a pressure of conformity.
- Apart from this, there are also certain groups to which you want to belong to but you are not currently a part of it. Suppose you cannot afford expensive designer clothes today but someday you want then that group which buys premium designer clothes is an Aspirational Group for you. Whereas, the groups whose values and attitudes we reject are called the dissociative groups.
- Now, marketers reach and influence these groups through an Opinion leader; he is a person who informs and gives information about various products and brands to his group members. They have a good influence on their group members.
- According to some communication researchers, our society comprises small groups, known as cliques, and their members interact with each other frequents. This scenario can be compared to the different clubs and committees in B-schools, where all the students from different clubs and committees (cliques) interact with each other.
- Now, as a promoter of any event of your B-school, you would want cliques to talk more about your event with each other. For that, you will find people who have networks in most of the cliques. These people are known as bridges.
- Many companies do pay money to influencers to promote their product in different cliques anonymously. This tactic is known as shill marketing or stealth marketing.
- You must have also heard that many of the reviews on digital platforms are being given by the people who are in some financial contract with the company. Another interesting example could be of some comedy shows where there are anonymous people who laugh while sitting in the audience.
- This is the most important determinant in influencing the buying and deciding characteristics of consumers. We acquire a lot of values, attitudes, beliefs and perspectives from our family.
- In most of the Indian families, the women are considered to be the main purchasing member; hence they influence the buying decision the most. The marketers of specific products very cleverly target these women to promote their product.
- All of us play multiple roles in lives, the roles that we play influences our behaviour and choices. The role that we play decides our "status". This also influences the kind of products and services that we use. Most of the times, we like those brands and products which relates to our identity that emerges from the kind of roles we play.
- You must have observed that people who are fit and muscular generally prefer to buy Royal Enfield among other bikes. This is nothing but a buying behaviour arising out of social factors.
- It influences consumer behaviour to a great extent.
- Cultural values and elements are passed from one generation to another through family, educational institutions, religious bodies, social environment, etc. Cultural diversity influences food habits, clothing, customs and traditions, etc.
- For instance, consuming alcohol and meat in certain religious communities is not restricted, but in certain communities, consumption of alcohol and meat is prohibited.
- Each culture consists of smaller sub-cultures that provide specific identity to its members.
- Subcultures include sub-caste, religious sects geographic regions as South Indians, North Indians, and based on languages etc.
- The behaviour of people belong to various sub-cultures is different. Therefore, marketers may adopt multicultural marketing approach, i.e., designing and marketing goods and services that cater to the tastes and preferences of consumers belonging to different sub-cultures.
Question No. 2
What are the objectives of Pricing? Discuss the basic methods of Price
Determination.
(20 Marks)
Solution:
Pricing Methods:
Pricing method is a technique that a company apply to evaluate the cost of their products. This process is the most challenging challenge encountered by a company, as the price should match the current market structure and also compliment the expenses of a company and gain profits. Also, it has to take the competitor’s product pricing into consideration so, choosing the correct pricing method is essential.
The pricing method is divided into two parts:
- Cost Oriented Pricing Method– It is the base for evaluating the price of the finished goods, and most of the company apply this method to calculate the cost of the product. This method is divided further into the following ways.
- Cost-Plus Pricing- In this pricing, the manufacturer calculates the cost of production sustained and includes a fixed percentage (also known as mark up) to obtain the selling price. The mark up of profit is evaluated on the total cost (fixed and variable cost).
- Markup Pricing- Here, the fixed number or a percentage of the total cost of a product is added to the product’s end price to get the selling price of a product.
- Target-Returning Pricing- The company or a firm fix the cost of the product to achieve the Rate of Return on Investment.
- Market-Oriented Pricing Method- Under this category, the is determined on the base of market research
- Perceived-Value Pricing- In this method, the producer establish the cost taking into consideration the customer’s approach towards the goods and services, including other elements such as product quality, advertisement, promotion, distribution, etc. that impacts the customer’s point of view.
- Value pricing- Here, the company produces a product that is high in quality but low in price.
- Going-Rate Pricing- In this method, the company reviews the competitor’s rate as a foundation in deciding the rate of their product. Usually, the cost of the product will be more or less the same as the competitors.
- Auction Type Pricing- With more usage of internet, this contemporary pricing method is blooming day by day. Many online platforms like OLX, Quickr, eBay, etc. use online sites to buy and sell the product to the customer.
- Differential Pricing- This method is applied when the pricing has to be different for different groups or customers. Here, the pricing might differ according to the region, area, product, time etc.
Question No. 3
Write short notes on the following:
(a) Positioning
(b) Warehousing
(c) Personal Selling
(d) Relationship Marketing. (4×5 Marks)
Solution:
(a) Positioning
(b) Warehousing
- Pick and Pack: A process of selecting one or more products that was ordered by a customer, checking it, and packaging it for shipping.
- Inventory Management: The inventory definition is tracking, measuring, updating, and retrieving products in a storage facility, including minimum and maximum quantities, stock-outs, and service level agreements.
- Order Fulfillment: The process of getting an order ready for shipment to a customer, and making sure it is shipped out as soon as possible.
- Warehouse Management System (WMS): A software program designed to oversee warehouse operations, inventory storage, demand forecasting, and daily efficiency.
(c) Personal Selling
- Human contact: It involves person-to-person interaction where a seller interacts directly with the prospective customer and executes a personalised sales strategy according to the customer’s needs, wants, and expectations.
- Development of relationship: Personal selling involves developing a relationship between the seller and the buyer where trust is established, and the prospective buyer can rely on the salesperson. Moreover, this technique even results in the salesperson becoming a part of the buying process.
- Two-way flow of information: Unlike mass marketing, personal selling is characterised by a two-way flow of information. The prospective buyers get their chance to ask questions and clear their doubts directly from the seller before purchasing.
- Quick communication: Since personal selling involves person-to-person interaction, the communication flow is really quick.
- Flexibility: It involves the salesperson to tailor the sales pitch according to the prospective audience’s persona and requirements, making this sales tool flexible.
- Satisfaction: The process of personal selling requires the salesperson to understand the customer’s needs and satisfy the same by offering the customer the opportunity to buy something he has to offer.
- Persuasion: Personal selling isn’t just about informing prospective customers about the company’s offerings. It also involves using the power of persuasion to make customers accept the seller’s point of view or convince the customer to take a particular action.
(d) Relationship Marketing
Question No. 4
Differentiate between the following
(a) Consumer goods and Industrial goods
(b) Selective and Intensive Distribution
(c) Advertising and Publicity
(d) Selling and Marketing
(4×5 Marks)
Solution:
S.No. | SELLING | MARKETING |
---|---|---|
01. | Selling refers to creating products and selling them to customers. | Marketing refers to finding wants of people/customer and fill them. |
02. | Selling revolves around the needs and interest of the seller. | Whereas Marketing revolves around the needs and interest of the consumer. |
03. | It emphasis more on product or service. | It emphasis more on consumer needs and wants. |
04. | Selling is a only an integrated part of the marketing process. | While marketing is a wider term consisting of number of activities. |
05. | Selling is based on short term business planning. | Marketing is based on long term business planning. |
06. | It manufactures the product first. | It identifies the market first. |
07. | It is sales volume oriented. | It is customer satisfaction with profit oriented. |
08. | It views business as a goods producing and selling process. | It views business as a consumer satisfying process. |
09. | Here seller is considered as king pin of market. | Here consumer is considered as king pin of market. |