MB0030: MARKETING MANAGEMENT

ASSIGNMENT SET – I

1. Explain BCG Matrix.

Ans:- BCG matrix: This model is used to identify company’s SBU’s position in the market. This
model identifies the SBU’s strength, weaknesses, opportunities and threats on the basis of
market growth rate and relative market share. This model is also known as growth share
matrix.

?
DOG
Model components:
Star: This category represents the high market share and high industry growth. SBU’s in this
category require large investment to defend their position. SBU will turn as cash cow after some
time.

Cash cows: This category represents the low growth rate and high market share which is the
characteristic of SBU operating in mature industry. Here company needs less investment to hold
their position. Hence it generates more cash or in management terms we say cash cow can be
milked.

Question Mark: This category represents high market growth and low market share. SBU’s in
this category has two options, either to invest heavily and bring them to star position or divest /
liquidate from that position.

Dogs: SBU’s in this category generates less cash for the company as it operates in low growth
and low market share. Usually companies will not invest in this category and try to liquidate or
divest.

2. Describe the marketing mix for Pepsi.

Ans:- Pepsi Co., one of today's leading soft drink companies, has not only revolutionized the soft
drink industry with its creative marketing techniques and unforgettable taste, but for years has
dominated the snack food and juice industry as well. Pepsi Co. is amongst the most successful
consumer product companies in the world. The company consists of the Pepsi-Cola which is the
world's second largest beverage company, Frito-Lay Company which is the world's largest
manufacturer and distributor of snack chips, and Tropicana Products, Inc. which is the world's
largest marketer and producer of branded juices. Pepsi Co. is proud to declare that its overall
mission statement is: "To increase the value of our shareholder's investment through sales
growth, cost controls, and wise investments of resources. PepsiCo believes that commercial
success depends upon offering quality and value to consumers and customers; providing
products that our safe, wholesome, economically efficient, and environmentally sound while
adhering to the highest standards of integrity."

PepsiCo's company objectives are based on one question: "What exactly is it that enables the
best consumer product companies to grow year in and year out?" Market positioning is one of
the most important aspects of PepsiCo success. It has been a leader and gaining market share in
each of its core businesses and strives to continue in recognizing under-marketed target regions
throughout the world to continually gain market share from its competitors. The second aspect
of PepsiCo's objectives deals with continuing is strong well- recognized consumer brand name
domestically and internationally. Third the company strives to recognize good growth prospects
and opportunities for new and alternative product development within each of its core
businesses. PepsiCo's fourth objective is to globally diversify its portfolio. Pepsi Cola brand
beverages are now available in over 160 different countries, Frito-Lay operates in over 42
countries, and Tropicana has a presence in over fifty countries spanning over Europe, Asia, and
South America. Finally, the last objective of PepsiCo is to be more productive and efficient
through the competitive advantages of its product innovation capabilities, the company's
streamlined patented manufacturing process, and the vast scale of the manufacturing and
distribution system.

Through its promotions, advertising, and sponsorships Pepsi has created one of the largest and
most opportunistic and unique companies around. Through its use of integrated marketing
communications it has created a brand name and product that is unique to all others. It strives
to globalize is business abroad with its Frito-Lay product line, Tropicana juices, and Pepsi
beverages. It continues to find different and un-tapped target markets around the world to gain
market share from its competitors. It also continues its innovation of products to adapt to a
changing global economy which has been a key to its success in the past and will be key to its
success in the future. The fact that PepsiCo has many different product lines and business
ventures that incorporate its name creates many different target markets for each of its
products. In focusing on the Pepsi-Cola beverage product, PepsiCo. has retained a long history of
concentrating on youth as its main target market-"Generation Next!" It has spent billions of
dollars in trying to woo the young and nearly young, implying that Coca-Cola is for the older
generation. The reason Pepsi-Cola has fiercely targeted this market is because it is the largest
amongst its users. Market segment profiles have shown that the majority of carbonated
beverage drinkers are youth and middle age people. Also, Pepsi continually targets the college
market in which they spend huge amounts of money to compete with Coca Cola in acquiring
contracts with universities (i.e. CSUF) to have sole representation of their products distribution.
Pepsi's use this behaviouristic segmentation has been a key to the company's success.

3. Choose any well-known company and study the micro environment and
macro environment for the same.
Ans: - Analysis of Micro and Macro Environment of TATA Motors
 Micro Environment: they have a direct impact on business (Change more quickly) eg:
Tastes and Preferences of Customers.
 Customers: Remote as well as country side customers mainly.
 Competitors: Mahindra, Eichier, Bajaj
 Employees: Satisfied employees efficient work,
 Suppliers: Raw Material Providers
 Company: State of Art as well as largest Utility MUV manufacturer in India.

Macro Environment:
 Macro Environment: Has an Indirect and Long term Impact on Business.
  It is also known as PESTEL analysis.
 Socio Cultural Environment: People need a strong Builded Vehicle, as they think that
India has not so good roads to DRIVE ON.
 Legal Environment: law and regulations of a country, favourable for vehicle Industry
{SEZ}.
 Economic Environment: Phase of Economic Cycle Inflation and Purchasing power of
People.
 Political Environment: From last 15 years we are having a democratic alliance into
power, and they have favoured Industrial Growth.
 Technological Environment: Now Country India has a holding hand in technological
progress.

TATA ACE SWOT ANALYSIS

Tata Motors Limited, formerly known as TELCO (TATA Engineering and Locomotive Company),
is India's largest passenger automobile and commercial vehicle manufacturing company. It is
also the world's 5th largest commercial vehicle manufacturer.

Strengths
Tata Motors is the largest truck manufacturer and second largest passenger vehicle
Manufacturer of India. In addition, the company is the fifth largest truck manufacturer in the
world. Tata Motors produces a diversified range of vehicles catering to a wide range of
customers and is witnessing a constant growth in its sales.

Weaknesses
While many of its competitors have aggressively expanded into overseas markets, Tata Motors
has ventured into foreign countries only in the recent past. In addition, the company is
dependent on the Indian market, as nearly 83% of its sales were generated from India in FY
2005/06.

Opportunities
In July 2006, Tata Motors made an industrial partnership agreement with fiat to share the
Indian facilities to manufacture vehicles, engines and transmissions for both Indian as well as
overseas markets. In August 2006, Tata Motors announced that the company would venture
into the Russian market by introducing commercial vehicles and buses. Two months later, Tata
Motors announced the launch of its passenger vehicles in Ghana.

Threats
As Tata is a late entrant to the global market, stiff competition might put pressure on the
company's expansion plans. In addition, the foray of top global manufacturers into India and
other neighbouring countries has increased competitive pressures. Other factors such as rising
fuel and raw material costs, stringent emission norms and the related of compliance can affect
the company's performance, going forward.

4. Write a short note on consumer buying behaviour.

Ans: - Consumers are individuals, households or businesses who use the products. Consumer
characteristics vary from country to country. Therefore it has become challenging task for
marketer to understand the need, buying behavior of consumer before developing product and
marketing it.

Characteristics affecting consumer behavior.

Cultural, Social, Personal and Psychological factors influence the consumer behavior. These are
external to the company and cannot be controlled. Marketer would like to understand the
impact of these factors on his/her organization.

I. Cultural factors:
1. Culture is the combination of customs, beliefs and values of consumers in a particular nation.
Majority Indians are vegetarians and a company which sells non vegetarian items should
analyze these values of the consumer. For example, KFC which sells chicken dishes all over the
world added vegetarian burgers in their menu to serve vegetarian consumers. Another
multinational McDonald, whose majority of sales comes form selling beef lets, didn’t include in
the Indian menu as cow is a sacred animal.

2. Subcultures are part of culture comprising, geographic regions, religions, nationalities and
racial groups. The value system of these groups differs from others. For example, Hindus in
north India eat special vegetarian food during the Navaratra festival. They prefer to spend their
time with their family. During this time restaurants will have lesser traffic. To attract the
customers, restaurants started offering the authentic Navaratra dish. This helped the restaurant
to attract the family who don’t have time, bachelors and people want to spend their time with
family without allotting much time for food preparation and so on.

3. Social class these are permanent groups in the society whose members have common likings.
According to Mckinsey consumer report, Indian consumers can be classifies into five different
categories. They are:
a. Deprived b. Aspires c. Seekers d. Strivers and e. Global Indians.

a. Deprived are the people who earn less than Rs 90,000 annually. This group is also known as
below poverty line. They are the poorest people in the country. They won’t get continuous
employment and they earn their lively hood from seasonal work. People in this category will do
less skilled or semi skilled work.

b. Aspires belongs to the families who earn between Rs90, 000 to Rs 2, 00,000. This group
consist small shop keepers, industrial workers, and small land holding farmers. Though they
earn more than deprived class, but half of their money goes for basic amenities and food.

c. Seekers earn between Rs 200,000 to 500,000. This class varies largely. The group contains
fresh workers, middle level employees, government employees and business people. The class
varies widely on the age, attitude and other factors.

d. Strivers belong to the group who earn between Rs 500,000 to 1,000,000. People in this
category are considered very successful. The group contains business people, large farmers,
senior government officials and professionals. Their earnings are enough to fill their apatite of
materials. They are leading the consumption led growth in India.

e. Global Indians are earning more than Rs 1,000,000. This group is comprised of senior
government officials, professionals, business people and top business executives. India is
witnessing the growth in this class. They are truly global; they purchase international brands
and have international cuisine.

II. Social factors

Human beings are social animals. They live and interact with other people. Therefore there is a
chance of influence by others on their opinions. Marketers like to identify such influential
persons or groups of consumer. Generally such groups are classified into two major groups
namely reference groups and family.

Reference groups are used in order to evaluate and determine the nature of a given individual
or other group’s characteristics and sociological attributes. Reference groups provide the
benchmarks and contrast needed for comparison and evaluation of group and personal
characteristics. “Reference groups are groups that people refer to when evaluating their own
qualities, circumstances, attitudes, values and behaviors.” – William Thompson & Joseph Hickey,
Society in Focus, 2005.” Reference groups act as a frame of reference to which people always
refer to evaluate their achievements, their role performance, aspirations and ambitions.

Family: Indian culture gives utmost importance to the family. People discuss with their family
before purchasing the valuable items. Wife, children and parents influence the decisions of the
family. Therefore many companies use either whole family or kids in their promotional
programs.

III. Personal factors:

Individual factors like age, occupation, lifestyle and personality influence the consumer decision
making. We discussed age and occupation factors and their application earlier in the marketing
environment unit. We will discuss lifestyle and its influence on the consumer in the
segmentation unit. In this section we will focus on the personality and its influence on the
consumer decision making process. Personality is the image of people’s traits. Traits include Self
confidence, Dominance, autonomy, defensiveness, adaptability and aggressiveness. Many
companies used these concepts in their marketing communications. Bajaj pulsar used
muscularity to highlight its image (definitely male). Fair and lovely and stay free tried to
highlight 21st century Indian girl and their aspirations in their communications.

5. Company A has homogeneous consumer preferences in the market;

Company B sells different variants of soaps, while Company C is a small firm
with constrained resources. What do you think is the most suitable market
coverage strategy for the all the three companies.

Ans: - Differentiated Marketing Strategy will be the most suitable market coverage strategy for
all the three companies.

6. Describe various bases for positioning the product with example.

The bases for positioning strategies that are available are:
1 Attribute Positioning: A company positions itself on an attribute such as size or number of
years in existence. Sun feast position its snacky brand as bigger lighter and crisper.
2 Benefit Positioning: The product is positioned as the leader in a certain benefit.
3 Use or Application Positioning: Positioning the product as best for some use and
application.
For Example, Kenstar positioned its product as unexpectedly cold.
4 User Positioning: Positioning the product as best for some user group.
5 Competitor Positioning: The product claims to be better in some way than a named
competitor.
6 Product Category Positioning: The product is positioned as the leader in a certain product
category. Bajaj CT 100 was positioned as leader in the entry segment bikes.
7 Quality or Price Positioning: The product is positioned as offering the best value.