Basics Fundas of Marketing

Submitted to: Ms. Karon Shaiva

Submitted by: Sunny Pawar – A010

PT MBA(SE) - III

School of Business Management

NMIMS (2014-15)

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Q.1. Levels of Product

• Core Product – What is the core benefit your product

offers? The core product is not the tangible, physical product. You can’t

touch it. That’s because the core product is the benefit of the product

that makes it valuable to you.

• Basic/Tangible Product – The tangible product is the actual,

physical product. You can get some use out of it.

• Expected Product –The expected product is the product the

customers expect it to be

• Augmented Product – The augmented product is the non-physical

part of the product. This meets the customer’s desires beyond his

expectations. It usually consists of lots of added value, for which you may

pay a premium.

• Potential Product – The potential product is the futuristic aspect of

the product i.e. how the product can be ideally with further add-ons and

technological or other improvements . The possible evolutions that can be

made to make the product a distinguished offer14/08/2014 2

In a midday meal (Annakshetra) project

of Akshaypatra for kids in municipal

school in rural areas of south India

these can be:

• Core Product :Hunger

• Basic: Edible and Sufficient Khichdi

• Expected: Tasty

• Augmented: Nutritious

• Potential: Khichdi + Buttermilk 14/08/2014 3

Product levels in social sector

Core (Hunger)

Basic (edible and sufficient khichdi)

Expected (Tasty)

Augmented (Nutritious)

Potential (khichdi + buttermilk)

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Q.2. a) Porter's Five Forces analysis Industry Focus

• While a Porter's Five Forces analysis focuses specifically on the

industry in which a company operates and a SWOT analysis focuses

primarily on the company itself, both analyses actually focus closely

on the industry.

• In a SWOT analysis, the strengths and weaknesses of a company are

analyzed relative to the entire industry, while the threats and

opportunities originate primarily within the industry.

• The industry focus of both of these tools helps managers concentrate

on the most relevant environment when considering strategic

planning initiatives.

• Porter's Five Force model can be used in a scenario where you want

have more micro level Planning.

• It gives you a detailed insight vertically and horizontally in a value

system. Be it be a Production, Marketing or Finance.

• SWOT is more of assessing a Scenario at a Macro Level which can

give a bird's eye view of a situation or scenario.

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Intensity of rivalry

within the industry

KEF, YuvaP, Pratham

Threats from Substitute product-(MCGM,

Unorganized Job Sector)

Bargaining power of Buyers

(Customers)-Trained Youth &

Corporate Companies, Placement Agencies

Threats of new entrants-School for

Dropout, New NGO’S, 2% CSR, Direct

Placement by Corporate

Bargaining power of

Suppliers-CBOS’s, NGO,

Youth And Parents,

Corporate

Porter's Five Forces analysis - Kotak Education Foundation

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Q.2. a) SWOT Analysis

• Opposition is an inevitable part of change and one that can

significantly impact our community development initiatives

•A SWOT analysis guides us to identify the positives and negatives

inside our organization (S-W) and outside of it, in the external

environment (O-T).

• Developing a full awareness of our situation can help with both

strategic planning and decision-making.

• The SWOT method (which is sometimes called TOWS) was

originally developed for business and industry, but it is equally

useful in the work of community health and development,

education, etc.

• SWOT is more of assessing a Scenario at a Macro Level which

can give a bird's eye view of a situation or scenario.

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STRENGHTS:

•Self funded

• NGO networking: Snehasagar,

Minim Charitable Foundation,

MuktiSadan Foundation

• Networking with MCGM & other

govt. agencies such as MAVIM,

ICDS, Virar Vasai

Mahanagarpalika, etc.

•USP :Rs. 300/- for rigorous 3

month training and 100% job

placement to dropouts from B.P.L.

Category.

• Good rapport with community &

primary stakeholders through

CBO’s such as Triratna Prerana

Mandal

• MBA students internship for 2

months every from ITM college

Kharghar work as volunteer

Weakness:

• Lack of Training and

Development for staff

• No impact assessment

• No update of curriculum

• More emphasis is on

quantity and not the quality

of the training provided

• Top down approach in

decision making

• Poor human resource

management leading to high

Attrition rate.

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Opportunity:

• Increasing no of dropout

in Mumbai- Rich

demographic resource.

• Foreign direct

investment in retail

industry will provide

further job opportunities

to fresher & trainees

• Strategic CSR tie-ups

with MNCs and Hotel

Industry.

Threat:

• Competition for new

entrants such as

Rustomjee Construction

ltd.

• PRATHAM- Residential

training

• MCGM thinking to

introduce new project for

dropout youths

•School for dropout youth

getting direct jobs from

Corporate

• Innovation in Vocational

training

•Policy change e.g. NSDC

withdrawing its support.

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Internal vs External

Forces and facts beyond one’s control

include:

• Future trends - in your field (Is

research finding new treatments?) or

the culture (Do current movies

highlight your cause?)

• The economy - local, national, or

international

• Funding sources - foundations,

donors, legislatures

• Demographics - changes in the age,

race, gender, culture of those you

serve or in your area

• The physical environment (Is your

building in a growing part of town? Is

the bus company cutting routes?)

• Legislation (Do new legal

requirements/ policies make your job

harder...or easier?)

• Local, national or international

events

Internal factors include one’s resources and experiences such as :

• Human resources - staff, volunteers, board members, target population

• Physical resources - your location, building, equipment (Does your building have a prime location? Does it need renovations?)

• Financial resources - grants, funding agencies, other sources of income

• Activities and processes - programs you run, systems you employ

• Past Experiences & Expertise - building blocks for learning and success, your reputation in the community.

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Q.3. STP & Marketing strategy

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Levels of Market Segmentation

A market segment is a

classification of potential

customers by one or more

characteristics, in order to

identify groups of

customers, which have

similar needs and demand

similar products and/or

services concerning the

recognized qualities of these

products.

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• In case of mass marketing, the seller does mass production, mass

distribution and mass promotion for the product. The single product then

caters to all the buyers in the population.

• Mass marketing thus creates the largest potential market leading to lower

costs and thereby lowering prices and higher margins, but it also creates

difficulty of reach and makes it real difficult as well as expensive to reach all

audience.

• Because of this reason, sellers are turning towards micro-marketing

which happens at one of the following four levels:

1. Segment marketing – targeting a group of customers having a similar

set of needs and wants.

2. Niche (Tiny) marketing – targeting a narrowly defined customer group

who seek a distinctive set of benefits.

3. Local marketing – targeting a local group of customers

4. Individual marketing – This is ultimate level of segmentation where

segmentation boils down to segments of one.

http://geekyfry.com/management/marketing/segmentation-levels-

variables/

Segmentation Levels

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Segmentation Variables (Customer Profile)

:

Segmentation, Targeting,

And Positioning.

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TYPE OF FIRM SEGMENTATION BASE POSSIBLE MARKET SEGMENTS

1. Banking Demographic segmentation Young couples, young families, older families, pre-retirement, retired

2. Mobile phone carriers

Benefit segmentation Highly social, work-oriented, safety contact, status symbol

3. Frozen foodmanufacturers

A broad mix is used here:

• Demographic segmentation

• Psychographic segmentation

• Behavioral segmentation

Single households, diet-conscious, family dining, parties, budget-conscious, variety seekers

4. Toothpaste Benefit segmentation Teeth whitening, sensitive teeth, fresh breath, cavity protection, tartar control

5. Restaurant Behavioral segmentation Regulars, special occasion, business lunch, quick spot

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Concentrated (Niche/Tiny)

marketing

Merit base Educational scholarship for M.Phil/Ph.D programs in

USA

Segment Remote Rural Villages Of South India

Target

Group

Post Graduate Girls (With Distinction)

From Low Income Groups

Positioning Coveted scholarship by an India

corporate to deserving Indian

candidates

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Differentiated (segmented)

Marketing

Microfinance Products

Segment Rural Markets and Tier II cities

Target

Group

Women from Low Income Groups,

SHG’s, JLG’s, etc.

PositioningCustomized loans for your unique

needs with tailor-made payment

options to match the income patters

of the community 14/08/2014 20

Undifferentiated (Mass) marketing-

One common standardized product

for all Kotak Education Foundation’s Vocational

training program

Segment Slums & Chawls of Mumbai

Target

Group

Dropouts/ unemployed youth (18-25

years) from Low income group.

Positioning Skill Building + Placements. Starting

salary of Rs. 6,500/- per month after

successful completion of the 3 month

training 14/08/2014 21

Q.4. a) Value Chain (Vertical Linkage)

Analysis

“ Gaining and sustaining a competitive advantage

requires that a firm understand the entire value

delivery system, not just the portion of the value

chain in which it participates. Suppliers and

customers and suppliers’ suppliers and customers’

customers have profit margins that are important to

identify in understanding a firm’s

cost/differentiation positioning, because the end-

use customers ultimately pay for all the profit

margins along the entire value chain.”

- Shank and Govindarajan (1993)

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Value Chain of Amul

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The existing supply chain of AMUL

• The distribution network

Amul products are available in over 500,000 retail outlets across India through its network of 3,500 distributors.

There are 47 depots with dry and cold warehouses to buffer inventory of the entire range of products.

• Gujarat Cooperative Milk Marketing Federation (GCMMF) transacts on an advance demand draft basis from its wholesale dealers instead of the cheque system adopted by other FMCG companies.

• This practice is consistent with GCMMF’s philosophy of maintaining cash transactions throughout the supply chain and it also minimizes dumping.

• Wholesale dealers carry inventory that is just adequate to take care of the transit time from the branch warehouse to their premises. This just in time inventory strategy improves dealer’s ROI. All the branches of GCMMF are engaged in route scheduling and have dedicated vehicle operations.

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The existing supply chain of AMUL

• Largest Cold Chain: AMUL has the largest cold chain network inIndia (18000 refrigerators) as compared to any other company. Thechemical components of milk are water, SNF and solids. It is aperishable product so it has to be consumed within 24 hours. Inorder to avoid wastage AMUL converts the milk into SNF (Solids notfats) and milk solids by evaporating the water, which comprises of60-70% of the milk contents.

• Customers: India is still in the evolutionary stage with tremendouspotential for high value products such as variants of milk. Thedistribution network is quite reasonable with access to metros aswell as rural areas.

• Suppliers: A majority of suppliers are small or marginal farmerswho are illiterate, poor and with liquidity problems. Farmers nowhave better access to information relating to markets, technologyand best practices in the dairy industry through net enabled kiosksin the villages and also improved bargaining power Indeed, in noother agriculture commodity does the farmer control the entire valuechain, from procurement to processing to marketing. In the dairysector, the Gujarati farmer is a link and value adder.

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The existing supply chain of AMUL

• Third party logistics service: There are ample deficiencies in the current infrastructure and the outbound logistics is taken care by GCMMF coordinating with distributors. It also connects with unions for product mix, product allocations and in developing production plans. The key lies in matching supply and demand as the demand outstrips supply by a big margin.

• Interlocking control: The objective of interlocking mechanism is to ensure that the interest of the farmer is always kept at the top of the agenda through representatives who constitute the Boards of different entities that compromise the supply chain. Professional managers and farmers work together as a team to strengthen the cooperative.

• Coordination agency: Objective of such an agency is to ensure the milk produced by the farmer is sold in the market either as milk or as value added product. With the creation of GCMMF (Amul), competition among co-operatives was eliminated while they could band together and take on the private sector.

GCMMF has ensured remunerative returns to the farmers whileproviding consumers with quality products under the brand nameAmul.

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FORM UTILITY: Enhancing the marketability of a product by changing

its physical characteristics. For example, boxed detergent can be

produced in liquid form, which may be more advantageous for certain

consumer requirements.

TIME UTILITY: Enhancing a product's marketability by making it

available at a convenient time. For example, a daily newspaper home

delivered so that the customer has it available immediately when he/she

awakes for the day.

PLACE UTILITY: Where the product or service is made available. For

example, if it is a retail establishment, people should be provided with

easy access. Mail order companies make it easy for customers to shop

whenever they want and then have their purchases delivered to them.

BRAND UTILITY:“The term brand utility describes a method of linking a brand to a cause or a mission. Brand utility therefore consists of showing and demonstrating the use of a brand. This ‘use’ is often social. The message brand utility communicates can replace or complement the classic persuasive advertising discourse on a product’s performance. The line of brand utility is often developed through a signature catchphrase or slogan. Some examples of brand utility practices: EDF - people connecting people / Nike -maximizing human potential through its signature "Just do It".”http://www.spotter.com/en/content/what-earth-%E2%80%98brand-utility%E2%80%99

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• FORM UTILITY: Customized sanitary napkins manufactured

by an SHG after understanding the specific requirement of each

& every women.

• PLACE UTILITY: Sanitary napkins are made easily available

and accessible at a place where women meet for usual

discussions & meetings.

• TIME UTILITY: Sanitary napkins are home delivered so that

women have it available immediately when they need it.

• Quality/ BRAND UTILITY: Several women still preferring

superior quality sanitary napkins provided by well known

brands such as Whisper, Carefree, etc. as against sanitary

napkins provided by NGOs through SHG’s i.e. trusting the

brand name of private companies.

Example: Sanitary napkins

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Q.4. b) Value vs. Satisfaction

Its means the customers’ evaluation (perceived value) of the difference

between all the benefits and all the costs of the product. For example: I

consider MicroMax phone as Value For Money to me as compared to the

expensive Samsung

CUSTOMER VALUE

Customer Satisfaction (Absolute)

• Its the match between customer expectations of the product and the product’s actual performance.

• “It is a person’s feelings of pleasure or disappointment resulting from comparing a product’s perceived performance in relation to his or her expectations”

• Its the desired marketing tool : Loyalty, retention, acceptance of new offers, word of mouth advertising and all these result to repeat buys

www.berlysitumorang.blogspot.com

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Q.5. C.E. vs. S.E.

• The primary difference between the business and the socialentrepreneurs is the purpose for setting up the venture. Whilethe business entrepreneurs' efforts focus on building a businessand earning profits, the social entrepreneurs' purpose is tocreate social change.

• A business entrepreneur may create changes in the society, but that is not the primary purpose of starting the venture. Similarly, a social entrepreneur may generate profits, but for him/her that is not the primary reason for starting the venture.

• Another key difference between the social and the businessentrepreneur is in the meaning of wealth creation. For thebusiness entrepreneur, 'wealth' is same as profits. For the socialentrepreneur, however, wealth also encompassescreation/sustenance of the social and environmental capital.Therefore, to be viable, a social entrepreneurship venture mustshow a positive Social and/or Environmental ROI.

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C.E. vs. S.E.Perceptions of Value

• For the business entrepreneur, value lies in the profit the entrepreneur and

investors expect to reap as the product establishes itself in a market that

can afford to purchase it. The business entrepreneur is accountable to

shareholders and other investors for generating these profits. To the social

entrepreneur, there's also value in profits, as profits are necessary to support

the cause. That said, value for the social entrepreneur lies in the social

benefit to a community or transformation of a community that lacks the

resources to fulfill its own needs.

Measure of Profitability

• The ventures of business entrepreneurs are always designed to turn profits

that benefit stakeholders, such as shareholders or private investors. Social

entrepreneurs also may engage in for-profit activities. However, they often

structure their organizations as nonprofits, or they donate their profits to the

causes they support. NIKA Water, for example, is a for-profit company that

sells bottled water. According to "Entrepreneur," 100 percent of the

company's profits support clean-water projects in Uganda, Kenya, Sri Lanka

and Nicaragua.

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Towards Balance ? ? ?

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Current Trend?

Towards convergence. . .

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SOURCE: http://www.4lenses.org/setypology/print

It’s Not a Compromise !

True social enterprise companies compete purely on the basis of quality, price

and delivery. They may have nonprofit status in the eyes of other people but

when you meet the management team you will be engaging with experienced

business managers that have worked in the "for profit” world of corporate

organizations successfully creating shareholder value. Now they have new

shareholders and instead of just creating profits they have a dual role of also

creating social value by investing in people.

http://www.adgshred.com/blog/bid/245203/Paper-Shredding-Social-Enterprise

Social enterprises could have organized as non-profits and relied on government

funding. Instead, they chose to demonstrate they can do well while doing good.

Providing clear regulations to include social enterprises is a necessary step

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Thank you!

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