Final Project

IMPLEMENATION OF MARKETING ON
NEW PRODUCT DEVELOPMET
SUBMITTED TO: MAM RIZWANA AKBER
SUBMITTED BY: Shakeel Ahmad (MB09021) (GL)

Numan maqsood (MB09056)
Zeeshan munawer (MB09060)
Waqas sarfraz ( MB09037)
Muhammad asif (MB09059)
Kamran (MB09015)
Muahmmad ameen (MB09009)
Hafiz ishtiaq (MB09147)

Dear MAM,
Here is the report, you asked us to prepare on the implementation of Marketing on “New
Product Development.”
We developed a company “Soft Touch” and formulated a new product fabric softener named
“Bubbles” basically meant for clothes softness and the additional benefits are the color
retention and long lasting fragrance.
As a company, our mission is to fulfill customer’s needs and provide them maximum
satisfaction at affordable price. We are a people company. Our people are our greatest
strength, and nothing can be achieved without their commitment.
In the project report we gave the introduction of our organization , discussed in detail the
product development process of our product. We have designed a Marketing Mix plan for the
product..
Our report is fully meeting your demand and we followed all the instructions that you gave us
for completing it.
Cordially
ENTIRE GROUP
ii
This report summarizes the approach taken to the development and advertisement of new
product in the market. It is based on a newly developed product “Bubbles-FABRIC
SOFTNER” by a well reputed company Soft Touch Company. The report includes different
aspects of New Product Development in the market.
The report highlights the product itself with a detailed description of development process
from idea generation to product commercialization. The report is an authenticate proof of the
company charging a reasonable price for its product because it describes the complete
production process of fabric softener along with the details of per unit cost incurred to
produce it. Tools and techniques used by the marketers to analyze the different aspects of
market and to determine the demand and worth of fabric softener in the market are also
mentioned in the report. The report also includes a business analysis segment in which the
business analyst has checked the basic business strengths for this product to produce on large
scale. Marketing Strategies, policies of advertisements, channels of distribution and
promotional mix elements that the company is using, are also discussed in this report.
Report also contains company’s information, with a brief description of the departments of
the organization as well as their Vision and Mission Statement. Company has a strong good
reputation since its incorporation. This is because of the highly qualified quality control staff
of Premium Industries. This quality is also maintained in the production of new product of
fabric softener.
At the end the report is also supported by a rich glossary to describe different terminologies
used in this report and an annexure section to include the documents that were used in any
way during the development of fabric softener.
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All praises for Allah who is the ultimate source of knowledge we offer our
humblest thanks from the cores of our hearts to the Holy Prophet Hazrat
Muhammad (PBUH) who is forever a model of guidance and knowledge for
mankind.
We wish to express our special thanks to our worthy teachers MAM

RIZWANA AKBER for his Cooperation, Valuable guidance and kind
supervision under which this project has been completed.
We are also thankful to all those persons whose assistance makes it possible for
us to complete our project.
Holly Prophet peace be upon him
iv
The greatest social reformer
Our Honorable Teachers & Loving Parents
Whose,
Love, Affection, Motivation, Patience, Support,
Spiritual Inspirational, Give us Encouragement,
To all those People who have quenched for Knowledge,
To all those who have dedicated their lives to others,
To all of those who have served and sacrificed for
Sake of Freedom
To all of those people, who may be gone now,
But they will never be
Forgotten....
v
CONTENTS PAGE NO.
Title Page i
Letter of Transmittal ii
Executive Summary iii
Acknowledgement iv
Dedication v
Table of Contents vi
List of Illustration x
Introduction to Report 1
Organization Profile 2
History of Organization 3
Vision 5
Mission 6
Nature of Business 7
Departments of Soft Touch 16
Production Department 16
Quality Control Department 17
Sales Department 19
Human Resource Department 20
Research and Development Department 24
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Accounts and Finance Department 26
Marketing Department 27
New Product Development 29
Idea Generation 33
Idea Screening 35
Concept Development 36
Concept Testing 37
Market Analysis 38
Customer Analysis 38
Market segmentation 41
Levels of Segmentation 45
Patterns of Segmentation 47
Evaluation of Segments 48
Segmentation Variables for Fabric

50
Softener
Selecting the Target Market 51
Patterns of Target Market 51
Positioning 54
Positioning strategy for Fabric Softener 58
Business Analysis 59
Demand Estimation 59
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Cost Figures 59
Capital Demand 63
Price of Product 68
Product Development 70
Development of Fabric Softener 72
Basic Formulation of Product 73
Main solvent 73
Conditioning Agent 73
Surfactant 74
Emulsifiers 75
Preservative 75
Wrinkle Remover 76
Ph Stabilizer 76
Perfuming Agent 76
Fluorescent Brightener 77
Production Process 77
Quality Control 79
Test Marketing 81
Commercialization 84
Commercialization Plan for Fabric 85

Softener
viii
Marketing Mix 87
Product 89
Products of Soft Touch 94
Product Decisions of Fabric Softener 97
Price 98
Price of Product 108
Place 110
Levels of Marketing Channels 112
Marketing Channel for Fabric softener 114
Promotion 115
Promotional Mix 116
Steps in Effective Communication 117
Conclusion 127
Glossary 128
Bibliography 140
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TABLE NO TABLE NAME PAGE NO.
1 Direct Material Cost 60
2 Depreciation Values 61
3 Price of 500ml Bottle 68
5 Basic Formulation of Product 73
6 Quality Control Test 80
7 Direct Material Cost 104
8 Depreciation Values 105
x
FIGURE NO. FIGURE NAME PAGE NO.
1 Firm Setup 14
2 Department of Firm 15
3 Water Treatment Plant 63
4 Mixing Vessel 64
5 Mixing Vessel 64
6 Bottling Line 65
7 Labeling Machine 66
8 Labeling Machine 66
9 Mixing Vessel Working 78
10 Marketing Mix 88
11 Categories of Consumer Products 91
12 Levels of Marketing Channel 112
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The report is issued by a well-known and reputed firm SOFT TOUCH. The firm relates to
detergent industry. Soft touch is a partnership firm. The organization has successfully
launched its two products washing soap “WASH NOW” and washing powder “QUICK
CLEAN” in the market. This report is a detailed description of the procedures of launching
and marketing Soft Touch new product “BUBBLES” -FABRICS SOFTENER.
Fabric Softener is liquid composition which makes fabrics soft enhances color and imparts
long lasting fragrance. The report summarizes different aspects of introducing and advertising
a high quality fabrics softener, ranging from idea generation to achieving a high market share
with the help of effective advertisement.
It contains detailed information about company, its departments, and the committed partners
who are always willing to give a hand to the success of the company. It discusses in detail the
whole procedure of segmentation, targeting and positioning. Information about production
process, raw materials used and the systematic & controlled process of making the high
quality fabrics softener is an integral part of the report. The pricing strategy used for setting
the price of the product is on the basis of real facts and figures.
Further, the business analysis and capital demand are also a part of the report. The report also
provides valuable information how the marketing mix for the product is designed. Methods
used for test marketing and the commercialization procedure used for obtaining the largest
market share are also discussed. In the end of report, there is a rich section of Glossary,
Appendix and Annexure for easy reading of the report.
UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

HISTORY OF THE COMPANY:
The “Soft Touch” is a partnership firm. It was established in the year 1999.It is comprised of
all types of partners mentioned here
 General partner
 Sleeping partner
 Active partner
 Partner not for profit
 Limited partner
The “Soft Touch” belongs to detergent industry. It has chosen to market its products only in
segmented areas. The segmented areas of “Soft Touch” are
 Rawalpindi district
 Faisalabad district
 Lahore district
 Gujranwala district
We have made 2 successful launches in its span of 11 years. First the soft touch came in the
market in 1999 with a big launch of a washing soap named “WASH NOW”. This launch was
very successful and made value in the minds of the customers for the company. The company
after gaining trust of the people made more than better launch of its new product. This time
the product was a washing powder named “QUICK CLEAN”. It got a very good response
from general public.
It hit its segmented areas effectively due to the fact that the company always takes a deep
look on its lacking and consults it with its research and development department which in
result made the company produce a product which crosses all the levels of the previous
launch in quality and in production as well it was also more economical.

Now in 2010
“Soft Touch” has launched a new product from the same detergent family and that is a fabric
softener and the company named it “BUBBLES”. The fabric softener is
“Liquid composition which makes the fabrics soft

protects color and imparts a long lasting fragrance.”

VISION
“To be known as leader of quality products.
Dedication to quality is a way of life at our company. In its activities the company will pursue
goals aimed at the achievement of quality excellence and succeed as a profitable business.
We not only want to be able to perceive and appropriately respond to social change but also
to be actively involved in forging the future and setting its trends.”

MISSION STATEMENT
“Our mission is to become competitive, dynamic and growing company. We want to be the
recognized industry leader in quality and service, providing more than expected for our
customers, employees and stakeholders.
We will make people’s lives beautiful by adding “Vitality” through our products enabling
them to feel good, look good and get more out of life.
We will continue maintaining the tradition of pride in our products, growth through
innovation, integrity in the management of our business and by fulfilling social
responsibilities in the community”

NATURE OF THE BUSINESS
By nature our business is a firm i.e. a PARTNERSHIP FIRM.
“Partnership” is the relation between persons,

who have agreed to share the profits of a business,
carried on by all or any one of them acting for all.”
Partnership Act is one of very old mercantile law. Partnership is one of the special types of
Contract Act .Its act is PARTNERSHIP ACT 1932.our partnership firm is formed by the
mutual; consent of all its partners .Initially its partners are 10 but due to is successful
business its number of partners increased by 15.
BASIC REQUIREMENTS OF CONTRACT
 Legally enforceable agreement

 Mutual consent
 Parties competent to contract
 Free consent
 Lawful object
 Consideration etc. apply to partnership contract also.
FIRM LEGAL ENTITY FOR PURPOSE OF TAXATION:
For tax law, income-tax as well as sales tax, partnership firm is a legal entity. It is liable for
tax. Though a partnership firm is not a juristic person, Civil Procedure Code enables the
partners of a partnership firm to sue or to be sued in the name of the firm. - A partnership
firm can sue only if it is registered.

PARTNER, FIRM AND FIRM NAME
“Persons who have entered into partnership wit one another are called individually “partners”
and collectively “a firm”, and the name under which their business is carried on is called the
“firm name”.
“Business” includes every trade, occupation and profession. Thus, a ‘partnership’ can be
formed only with intention to share profits of business. People coming together for some
social or philanthropic or religious purposes do not constitute ‘partnership’.
PARTNERS ARE MUTUAL AGENTS
The business of firm can be carried on by all or any of them for all. Any partner has
authority to bind the firm. Act of any one partner is binding on all the partners. Thus, each
partner is ‘agent’ of all the remaining partners. Hence, partners are ‘mutual agents’.
PARTNERSHIP CAN BE MADE AS ORAL OR WRITTEN AGREEMENT
As per normal provision of contract, a ‘partnership’ agreement can be either oral or written.
WRITTEN AGREEMENT:
Agreement in writing is necessary to get the firm registered. Similarly, written agreement
is required, if the firm wants to be assessed as ‘partnership firm’ under Income Tax Act. A
written agreement is advisable to establish existence of partnership and to prove rights and
liabilities of each partner, as it is difficult to prove an oral agreement. However, written
agreement is not essential under Partnership Act. It may be oral as well. But OUR
PARTNERSHIP FIRM IS BASED ON WRITTEN AGREEMENT BECAUSE IT IS
REGISTERED.

SHARING OF PROFIT NECESSARY:
The partners must come together to share profits. Thus, if one member gets only fixed
remuneration (irrespective of profits) or one who gets only interest and no profit share at all,
is not a ‘partner’. Similarly, sharing of receipts or collections (without any relation to profits
earned) is not ‘sharing of profit’ and the association is not ‘partnership’.
NUMBER OF PARTNERS
Since partnership is ‘agreement’ there must be minimum two partners. The Partnership Act
does not put any restrictions on maximum number of partners. However, section 11 of
Companies Act prohibits partnership consisting of more than 20 members, unless it is
registered as a company or formed in pursuance of some other law. Our numbers of
partners are 15 and it is registered.
DETERMINATION OF RIGHTS AND DUTIES OF PARTNERS BY CONTRACT

BETWEEN THE PARTNERS:
Subject to the provisions of this Act, the mutual rights and duties of the partners of a firm
may be determined by contract between the partners, and such contract may be express or
may be implied by a course of dealing.
EVERY PARTNER HAS RIGHT TO TAKE PART IN BUSINESS
Subject to contract between partners, every partner has right to take part in the conduct of the
business. Thus, every partner has equal right to take active part in business, unless there is
specific contract to the contrary.

THE PROPERTY OF THE FIRM
Subject to contract between the partners, the property of the firm includes all property and
rights and interests in property originally brought into the stock of the firm, or acquired, by
purchase or otherwise, by or for the firm, or for the purposes and in the course of the business
of the firm, and includes also the goodwill of the business.
PARTNER TO BE AGENT OF THE FIRM
Subject to the provisions of this Act, a partner is the agent of the firm for the purposes of the
business of the firm.
PARTNERS JOINTLY AND SEVERALLY LIABLE TO ACTS OF THE FIRM
Every partner is liable, jointly with all the other partners and also severally, for all acts of the
firm done while he is a partner. ‘An act of a firm’ means any act or omission by all the
partners, or by any partner or agent of the firm which gives rise to a right enforceable by or
against the firm ‘Joint and several’ means each partner is liable for all acts.
RECONSTITUTION OF A PARTNERSHIP FIRM
A partnership firm is not a legal entity. It has no perpetual existence as in case of a company
incorporated under Companies Act. However, the Act gives the partnership limited rights of
continuity of business despite change of partners. In absence of specific provision in
partnership deed, death or insolvency of a partner means dissolution of the firm. However,
partnership can provide that the firm will not dissolve in such case.
Change in partners may occur due to various reasons like death, retirement, admission of new
member, expulsion, insolvency, transfer of interest by partner etc. After such change, the

rights and liabilities of each partner are determined afresh. This is termed as reconstitution of
a firm.
DISSOLUTION OF A FIRM
A partnership firm is an ‘organization’ and like every ‘organ’ it has to either grow or perish.
Thus, dissolution of a firm is inevitable part in the life of partnership firm some time or the
other.
Dissolution of a firm without intervention of Court can be
(a) By agreement
(b) Compulsory dissolution in case of insolvency
(c) Dissolution on happening of certain contingency
(d) By notice if partnership is at will
(e) A firm can also be dissolved by Court
REGISTRATION OF FIRMS
Registration of firm is not compulsory, though usually done as registration brings many

advantages to the firm. Since ‘partnership contract’ is a ‘Concurrent Subject’ as per
Constitution, registration of firms and related work is handled by State Government in each
State. Law authorizes State Government to make rules for
 Prescribing fees for filing documents with registrar

 Prescribing forms of various statements and intimations are to be made to registrar
 Regulating procedures in the office of Registrar.
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DISADVANTAGES OF FIRM:
 Partner cannot sue if firm is unregistered

 Unregistered firm cannot sue third party
TYPES OF PARTNERS
 Active partner
 Sleeping partner
 Nominal partner
 Minor partner
 Secret partner
 Partners in profit only
 Salaried partner
1. ACTIVE PARTNER
He is the partner who actively participates in the management of the organization. He

shares the profit and loss of the business according to his share.
2. SLEEPING PARTNER
He is the partner who invests his share in the business but does not take part in the
management of the firm.
3. NOMINAL PARTNER
Firms take only his name for the good reputation of the firm.
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4. MINOR PARTNER
He is the partner who is below the age of 18.He is not liable for the losses of the firm.
5. SECRET PARTNER
He is one who takes active part in the management and has investment in the business
but people don’t know him as a partner.
6. PARTNERS IN PROFIT ONLY

He is a partner of the firm who only shares the profits of the firm. It is written in the
agreement of the firm.
7. SALARIED PARTNER
He is the partner who takes part in the management of the firm but he does not share
the profits of the firm rather he receives the salary.
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FIRM SETUP
FIGURE 1 FRIM SETUP

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DEPARTMENTS OF THE FIRM
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FIGURE 2 DEPRTMENTS OF FIRM
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DEPARTMENTS
Departments of Soft Touch Company (STC) are:
 Production department
 Quality control department
 Accounting and finance department
 Sales Department
 Human resource department
 Marketing department
 Research and development department
1. PRODUCTION DEPARTMENT:
Production department is established to control overall production process .In manufacturing

concern production process is the backbone of the company .To ensure that products are
processed properly this department.
OBJECTIVE OF DEPARTMENT:
It has objectives such as
 How much to produce

 In what manner is to be produced
 Make sub plans to coordinate activities
 To make economical use of labor, equipment and materials to manufacture the
company’s products in the quality.
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 Ensure whether desired units of production are achieved or not and if not they will
correct it according to desired performance.
 Controls the work of employees by suggesting them to follow necessary actions to
correct the situation.
Production department approves all the raw material, which is used in the production process.
These materials should be according to the standards of the detergent industry. If in any case
the material does not match with the standards, STC has a right to return it to the supplier. In
this case the entire cost of the material is beard by the supplier. This strong check on the
material is because of maintaining the high quality in the products, which are the credentials
of our firm.
PRODUCTION UNIT:
Our production unit is located in Lahore as it is convenient to get raw materials from here. Its
proper area is 26-b Multan road Lahore.
2. QUALITY CONTROL DEPARTMENT:

In manufacturing processes, quality controls are used in developing systems to ensure
products are designed and produced to meet or exceed customer requirements. These systems
are often developed in conjunction with other business and engineering disciplines using a
cross-functional approach.
Quality control is the branch of engineering and manufacturing which deals with assurance
and failure testing in design and production of products or services, to meet or exceed
customer requirements.
Quality maintenance is the basic organizational objective of STC. Quality check is made
from zero level to final products. For this purpose, samples are taken from the production to
16

check the quality control lab. These samples are tested according to the detergents industry
standards.
LABORATORY
In order to maintain the high quality the plant has a well equipped lab. Laboratory is
sufficient to measure the standards and to test raw materials and final products. The well
equipped lab enables the smooth flow of production process.
The company is very conscious about its products .Its new launched products pass through
many tests before approval. This is the reason for their successful launches.
TESTS OF FABRIC SOFTENER:
The finished fabric softer formulations are tested using a number of different protocols.
Simple laboratory tests are used to determine basic properties such as pH, viscosity, and
percent solids. These tests can help confirm that the correct ingredients were added at the
appropriate levels.
Other, more rigorous, tests are done to ensure the formulation is functioning correctly. One
such evaluation is a water absorbency test, sometimes called the Drays Wetting Test.
This procedure involves dropping small pieces of treated fabric onto water and recording the
length of time required for the fabric to sink. This measurement is taken 10 times to obtain an
average result.
Anti-wrinkle properties can be evaluated by asking panelists to rate samples of fabric before
they have been ironed. They are asked to numerically rate the amount of wrinkling between
the test sample and the fabric softener treated sample. The test to measure ease of ironing is
also done using trained panelists.
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3. SALES DEPARTMENT:
Our company has an organized sales department. The sales team records to whom the
organization has sold its products, when and for what price they were sold. This data will
come from the sales order. They may also be responsible for defining these output products.
The sales department uses different channels for making products available to the market.
The distribution channel is an organization or set of organizations involved in the process of
making a product or service available for use or consumption by a consumer or business user.
A number of channels of distribution are available:
 Selling direct, such as with an outbound sales force, Internet and telephone sales
 Agent, who typically sells direct on behalf of the producer
 Distributor
 Wholesaler, who sells to retailers
 Retailer, who sells to end customers
These channels comprise two types of delivery systems i.e.
 Direct delivery system

 Indirect delivery system
The basic difference between the direct and the indirect delivery system is that in a direct
distribution system, the company spends its own resources while in an indirect distribution;
the dealer spends his own resources on all the factors, which increases the sales volume.
DIRECT DELIVERY SYSTEM
Manufacturer Retailers consumer
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INDIRECT DELIVERY SYSTEM
Manufacturer distributor wholesaler retailer

consumer
The STC mostly uses the indirect way of selling. In selling process it is first involved in
distributing its products to the distributors then the distributers are involved in further
dealings but all the distributors are in contract with the sales department of the company.
4. HUMAN RESOURCE DEPARTMENT:
Human resource department is said to be the back bone of any organization .This department
is concerned with the management of organization most valuable asset , the people working
there who individually and collectively contribute to the achievement of the organization
goals and objectives. This department takes keen observation on all the matters relating to the
human resource e.g. employees compensation, employee leaves, medical facility, pension
funds, employees career management, human resource planning etc.
OBJECTIVE OF DEPARTMENT:
 Plan by assessment of current and future human resources on basis of capabilities,

experiences, skills and expertise.
 Set criteria for the recruitment of the employees and design programs regarding
human resource development.
 After planning, coordinates work of its employees. Divide the tasks among the
employees.
 Guides employees what tasks are to be performed to achieve targeted goals.
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 Whole activities are monitored to ensure that right person select for right job.
 The persons working are performing their duties effectively and efficiently.
 Determine the requirement of employees and provide benefits and compensation.
MAJOR FUNCTIONS:
 Human Resource Planning

 Human Resource Forecasting
 Recruitment and Selection
 Compensation and Benefits
HUMAN RESOURCE PLANNING
Human Resource Planning Parallels the plans for the business as a whole. HRP focuses on
questions such as these:
□ What do the proposed business strategies imply with respect to human resources?
□ What kinds of internal and external constraints will (or do) we face?
□ What are the implications for staffing, compensations practices, training and
development, and Management succession?
□ What can be done in the short run (tactically) to prepare for long-term (strategic)
needs?
Although HRP means different things to different people, general agreement exist on its
ultimate objective-namely the most effective use of scarce talent in the best interest of the
worker and organization.
HUMAN RESOURCE FORECASTS:
The purpose of human resource forecasting is to estimate labor requirements at some future
time. Such forecasts are two types.
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1. The external and internal supply of labor and
2. The aggregate external and internal demand for labor
Forecasting External Human Resource Supply:
Recruitment and hiring new employees are essential activities for virtually all firms, at least
over the long run. Whether they are due to projected expansion of operations due to the
forces of demand or due to normal workforce attribution, changes into the labor market are
necessary.
Forecasting Internal Human Resource Supply:
A reasonable starting point for projecting a firm’s future supply of labor is its current supply
of labor. The simplest type of internal supply forecast is the succession plan. Succession
plans may be developed for management employees, non-management employees, or both.
The process for developing such a plan includes
□ Setting plan
□ Identifying replacement candidates for each key position
□ Assessing current performance
□ Readiness for promotion
□ Identifying career development needs
□ Integrating the career goals of individuals with company goals.
Forecasting Human Resource Demand:
In contrast to supply forecasting, demand forecasting is beset with the help of the following
factors:
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□ Multiple uncertainties-changes in technology
□ Consumer attitudes
□ Patterns of buying behavior
RECRUITMENT AND SELECTION:
Recruitment is a form of business competition. Just as corporations complete to develop,

manufacture, and market the best product or service, so they must also complete to identify,
attract, and hire the most qualified people. Recruitment is a business and it is big business. It
demands serious attention from management, for any business strategy will fail without the
talent to execute it. Certainly, the range of recruitment needs is broad.
RECRUITMENT PROCEDURE IN SOFT TOUCH COMPANY:
Major sources of potential job candidates are:
□ Newspaper Adds
□ Internal Search Advertisement
□ Employees Referrals
Types of Recruitment:
□ Permanent Recruitment (Minimum Requirement Intermediate)

□ Daily Wages (At least Metric)
□ Contract (Graduation and Master for one year)
The candidates are selected on the basis of
□ Interview by HR Manager
□ Interview by Factory Manager
□ Interview by Concerned Department Head
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□ Final Interview by MD/Director
Check list for newly hired employees
□ Application form
□ Application (own hand written)
□ Original Resume
□ Attested copies of academic certificates
□ Four number of photographs (passport size)
□ Salary evidence
□ Two reference with complete name, address, Designation and contact number
□ Driving license of the employee
□ Interview evaluation form and test result
5. RESEARCH AND DEVELOPMENT DEPARTMENT:

This department is specially designed to cater the needs and desires of valued customers.
Research is a consciously directed investigation to find new knowledge. It is the forerunner
of an increasing number of products and process. Progressive firms actively search out new
product ideas from both external and internal sources. Externally, customers and competitors
are major contributor.
New product design and development is more than often a crucial factor in the survival of a
company. In an industry that is fast changing, firms must continually revise their design and
range of products. This is necessary due to continuous technology change and development
as well as other competitors and the changing preference of customers. A system driven by
marketing is one that puts the customer needs first, and only produces goods that are known
to sell. Market research is carried out, which establishes what is needed. If the development is
technology driven then it is a matter of selling what it is possible to make. The product range
is developed so that production processes are as efficient as possible and the products are
23

technically superior, hence possessing a natural advantage in the market place. All these
important function are performed by the R&D department.
R&D has a special economic significance apart from its conventional association with
scientific and technological development. R&D investment generally reflects a government's
or organization's willingness to forgo current operations or profit to improve future
performance or returns, and its abilities to conduct research and development.
The R&D department sets goals and plans such as:-
□ What research activities are to be performed to analyze the demand of the product in
the market?
□ What steps are to be taken to make the innovations and modifications in the product?
□ What steps are to be taken to develop the product according to market research?
□ How the research activities are to be performed to analyze the demand in the market.
□ What tasks are to be performed for the development of the product?
□ Find out market segment where product demand is high.
□ Analyzes deviations in the actual performance and after comparison he will make
necessary steps to achieve desired results.
Our company also has a very strong R&D department. The company came into existence
with the single product a washing soap named “WASH NOW”. Then a washing powder
named “QUICK CLEAN” and now by the success of both the products the company is now
in a position with the help and hard work of its R&D department to launch a new product
named “BUBBLES” which is a fabric softener.
24

6. ACCOUNTS AND FINANCE DEPARTMENT:
This department produces the data that measures company’s financial health and guides the
company in responding to weakness and opportunities Basic skills in financial management
start in the critical areas of cash management and bookkeeping, which should be done
according to certain financial controls to ensure integrity in the bookkeeping process.
Financial analysis shows the "reality" of the situation of a business -- seen as such; financial
management is one of the most important practices in management. The finance department
of a business takes responsibility for organizing the financial and accounting affairs including
the preparation and presentation of appropriate accounts, and the provision of financial
information for managers.
The main areas covered by the financial department include:
BOOKKEEPING PROCEDURE:
Keeping records of the purchases and sales made by a business as well as capital spending.
These records today are typically kept on computer files. But we still use the term ledger
entries to refer to the days when all financial transactions were carefully recorded in thick
books (ledgers).
CREATING A BALANCE SHEET AND PROFIT AND LOSS ACCOUNT.

Financial statements need to be produced at given time intervals, for example at the end of
each financial year. Trial balances are extracted from the ledger entries to create a Balance
Sheet showing the assets and liabilities of a business at the year end. In addition, records of
purchases and sales are totaled up to create a Profit and Loss (P&L) account
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PROVIDING MANAGEMENT INFORMATION:
Managers require ongoing financial information to enable them to make better decisions. For
example, they will want information about how much it costs to produce a particular product
service, in order to assess how much to produce and whether it might be more worthwhile to
switch to making an alternative product.
MANAGEMENT OF WAGES:
The wages section of the finance department will be responsible for calculating the wages
and salaries of employees and organizing the collection of income tax and national insurance.
ACQUIRING FIANANCE:
The finance department will also be responsible for the technical details of how a business
raises finance e.g. through loans, and the repayment of interest on that finance. In addition it
will supervise the payment of dividends to shareholders.
MANAGEMENT ACCOUNTS:
There is an important distinction between management accounts which involves the provision
of information to managers for ongoing decision making, and financial accounting which is
concerned with the preparation of financial statements outlining the financial health and
performance of a company in previous time periods.
The accounts and finance department of “SOFT TOUCH” is well equipped of all the
requirements needed to maintain the proper records of the company and making proper
evaluations and analysis.
7. MARKETING DEPARTMENT:
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Soft Touch is committed to maintaining and enhancing its presence in key markets in
Pakistan. The market force is well equipped with modern facilities of communication as
mobiles, fax and e-mails. This department is operating to stimulate demand for organization
products. Marketing management is a business discipline focused on the practical application
of marketing techniques and the management of a firm's marketing resources and activities.
Marketing managers are responsible for influencing the level, timing, and composition of
customer demand in a manner that will achieve the company's objectives. Marketing
management’s defined as the art and science of choosing target markets and getting, keeping
and growing customers through creating, delivering, and communicating superior customer
value. Any activity or resource the firm uses to acquire customers and manage the company's
relationships with them is within the purview of marketing management.
27

28

NEW PRODUCT:
By new product it means;
“Original products, product improvements,

product modifications and new brands that
a company develops through its own research
and development efforts.”
Every company must develop new products. New-product development shapes company's
future. Replacement products must be created to maintain or build sales. Customers want
new products, and competitors will do their best to supply them.
Methods for New Products Development:
A company can add new products through ACQUISITION or DEVELOPMENT.
The acquisition route can take three forms.
□ The company can buy other companies.
□ It can acquire patents from other companies.
□ It can buy a license or franchise from another company.
The development route can take two forms.
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□ The company can develop new product in its own laboratories.
□ It can contract with independent researchers or new-product development firms to

develop specific new products.
Categories of New Products:
Booz, Allen & Hamilton has identified six categories of new products.
1. New-to-the-world products: New products that create an entirely new market.
2. New product lines: New products that allow a company to enter an established
market for the first time.
3. Additions to existing product lines: New products that supplement a company’s
established product lines (package sizes, flavors, and so on).
4. Improvements and revisions of existing products: New products that provide
proved performance or greater perceived value and replace existing products.
5. Repositioning: Existing products that are targeted to new markets or market segments.
6. Cost reductions: New products that provide similar performance at lower cost.
Less than 10 percent of all new products are truly innovative and new to the world. These
products involve the greatest cost and risk because they are new to both company and the
marketplace. Most new-product activity is devoted to improving products.
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NEW PRODUCT DEVELOPMENT:
New product development is a complete process of bringing a new product or service into the
market. The product development process must carry out two things i.e.
Strong New Product Planning

It leads to the well-defined product concept prior to the product development, in which the
companies carefully defines and assess the target market, the product requirements and the
benefits to the company and consumers.
Systematic New Product Development Process

The new product development process is typically broken down into nine major steps.
1. Idea generation
2. Idea screening
3. Concept development
4. Concept testing
5. Market analysis
6. Business analysis
7. Product development
8. Test marketing
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9. Commercialization
The systematic approach allows for an easy approach to a complex process of product
development allowing a company to focus on all aspects.
1. IDEA GENERATION
New product development starts with idea generation.
“The systematic search for new product ideas.”
Sources of New Product Ideas:

□ Internal idea sources.
□ External idea sources.
Internal Idea Sources

The company can find new product development ideas internally from:
 Executive Level Management

 Production department
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 Sales personnel
 Marketing Research Officers
 Workers
 R & D department
 Other organizations
External Idea Sources

Beyond internal sources Good new product ideas can also come from:
 Customers
 Competitors
 Suppliers
 Distributors
 Trade magazines
 Research teams
 Government agencies
A number of ideas were generated by R&D Department of Premium Industries with the
objective of finding and developing a product which has the power to
“Enthrall Customers, Foil Competitors and Thrill investors”.
Some of the meaningful ideas were;
1. Fabric Softener to maintain the softness of fabric especially the heavy fabric.
2. Color Retainer & Enhancer for all cloth types.
3. Liquid washing Detergent.
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These were the basic ideas but the company has to choose one of them to proceed further.
2. IDEA SCREENING:
“Screening new product ideas

in order to
support good ideas and drop
poor one as
soon as possible”.
All the ideas proposed by R&D Department and collected from other sources were then
written and evaluated against a set of general criteria by new product committee.
New Product Committee

Basically this is a panel of experts from Production department, Finance department, R&D
department, purchasing department and Marketing department. As the new product
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development is most effective when there is team work among departments. This cross-
functional team guides the project through its development.
The new product committee rated the ideas against the following questions to check their
effectiveness and to choose the relevant ideas. The questions were:
□ Do these ideas match with the organizational goals?
□ Does the company have the ability to pursue these?
□ Which product has the ability to capture the big market?
□ What are the needs and wants of the people?
□ Which of them matches with the resources of the company?
After rating and screening new ideas the final decision of new
product committee favors and voted for the production of
FABRIC SOFTNER. The reason behind selection was
 It was intended to deliver more value to customers.

 It was demanding, trouble-free and interesting to advertise. .
 It was economical.
3. CONCEPT DEVELOPMENT:
“Concept development is a detailed version of the new
product idea stated in meaningful consumer terms.”
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After the idea screening the company developed some concepts which are the major source of
defining our product. The concepts were;
□ Fabric softener suitable for all fabrics used in households.
□ Convenient to use as can be added to clothes during

washing.
□ Suitable for all temperatures of water.
□ Excellent color retaining power.
□ Enchanting fragrance
□ An economical product accessible to all social classes in different volume packages.
□ Environment safe product made up of environment friendly ingredients.
4. CONCEPT TESTING:
“Testing the new product concepts with a group of
Target/potential consumers to find out if the concepts
Have strong consumer appeal”.
The company presented the product ideas in front of the potential customers through a written
and oral description. It was done to determine the attitudes and initial buying intentions of the
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buyers about the fabric softener .Marketing staff asked the following questions with the
different customers and departmental stores regarding the product.
Question asked
Q1. Can you understand the idea?
Q2. Do you feel any competitive advantage?
Q3. Will you purchase the product?
Q4. How frequently you will purchase it?
Q5. Any suggestion regarding the product?
After collecting the views of the customers and departmental stores, we determine the
following results:
 They appreciate our idea.

 They say that we like your product.
 They confirm the competitive edge.
These results suggest us to develop the product with moderate price in different volume
packages.
5. MARKET ANALYSIS
“Designing an initial marketing strategy for new
product based on product concept".
Marketing strategy development is also called market analysis. In it we analyze our

customers, competitors, segment our market and select the target market. Initial marketing
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mix for the product is also developed at this stage. The different factors considered in this
respect are as follows:
□ Customer analysis
□ Segmentation
□ Targeting
□ Positioning
CUSTOMER ANALYSIS:
The customer analysis allows organization to identify and target the most profitable
customers with marketing campaigns directed at various distribution channels. Integrating
these channels allows for targeted sales force management and the tracking and monitoring of
campaign results.
The Customer Analysis section assesses the customer segments that the company serves. In
it, the company must
1. Identify its target customers.
2. Assess the needs of these customers.
3. Show how its products and services satisfy these needs.
The first step of the Customer Analysis is to define exactly which customers the company
is serving or in future want to serve. This requires specificity; it is not adequate to say the
company is targeting small businesses.
Once we have clearly identified and defined the company's target customers, it is necessary to
explain the demographics of these customers. Questions to be answered include:
1. How many potential customers fit the given definition and is this customer base growing or
decreasing?
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2. What is the average revenue/income of these customers?
3. Where are these customers geographically based?
After explaining customer demographics, we explain detail of needs or the attitudes of

these customers. Conveying customer or the attitudes needs could take the form of
 Past actions ( purchasing behavior for a similar product in the past),
 Future projections (when interviewed, said that they would purchase product)
 Implications (because a particular segment use a similar product/service which our

product/service is going to enhances/replaces, then that segment will need our
product/service).
It should also contain the detail of the drivers of customer decision-making. Important
questions to answer include:
1. Do customers find price to be more important than the quality of the product or service?
2. Are customers looking for the highest level of reliability?
It is essential to truly understand customers to develop a successful business and marketing

strategy. As such, sophisticated investors require comprehensive profiles of a company's
target customers. The time spent to research and analyze target customers, will develop and
enhance business strategy and funding success.
Customer Analysis Results for fabric softener:
Demographics
 Age …………………... For every age

 Gender …………………… Both
 Income …………………… For any income group
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 Nationality …………………… Pakistani
 Social class ……………………. For every class
The major consumer expectations that proposed fabric softener should deliver:
 Softness
 Color Care
 Ease of ironing
 Fragrance
 Long Lasting Freshness
 Skin Mildness
 Luxury and Comfort
Customers are both price and quality conscious they want the product with the high
performance with the affordable prices.
MARKET SEGMENTATION:
What is a Market?
“A market is a social arrangement and an aggregate of people who, as individuals or
organizations, have needs for products in a product class and who have the ability,
willingness and authority to purchase such products”.
SEGMENTATION:
“A segment market is the identification of sub-sets of buyers within a market who share
similar needs and who have similar buying process.”
In other words we can say
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“Dividing a market into distinct groups with distinct needs,
characteristics, or behavior who might require separate
products or marketing mixes is termed as segment market.”
Why segment a market?

It’s a matter of fact that a focus on customer’s needs is a defining characteristic of marketing.
A true marketing orientation requires companies to focus on meeting the needs of individual
customers. In a simple world where consumers all have broadly similar needs and
expectations, a company could probably justify developing a marketing program that meets
the needs of the ‘average’ customer.
Segmentation, then, is essentially about identifying groups of buyers within a marketplace

who have needs that are distinctive in the way they deviate from the ‘average & high ’
consumer.
Benefits of Market Segmentation:
By tailoring marketing programs to individual market segments, any company can do a better
marketing job and make more efficient use of its marketing resources and they also develop
strong position in the market and can grow rapidly.
Classification of Markets:
Market segmentation can be classified depending on whether we are selling our offering to
individual consumers or a business. So according to the nature of product there are two types
of market:
 Business market
 Consumer market
BUSINESS MARKET:
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The business market consists of all individuals and organizations that buy goods and services
for one or more purposes like
 To make other goods and services.

 To resell to other business users or to consumers.
 To conduct the organization’s operations.
So, any good or service purchased for a reason other than personal household consumption is
the part of the business market.
CONSUMER MARKET: Total Market

Consumer market is that in which consumers buy goods or services for their own personal or
household use.
Market Segment Targeted
Bases for Segmenting Consumer Markets:
Geographic segmentation:
Geographic segmentation calls for dividing the market into different geographical units, such
as nations, states, regions, counties, cities or neighborhoods. A company may decide to
operate in one or a few geographical areas, or to operate in all areas but pay attention to
geographical differences in needs and wants. Variables considered are:
 Region
 County size
 City size
 Density
 Climate
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Demographic Segmentation:
Demographic segmentation consists of dividing the market into groups based on variables
such as age, gender, family size, family life cycle, income, occupation, education, religion,
race and nationality. Demographic factors are the most popular bases for segmenting
customer groups. One reason is that consumer needs, wants and usage rates often vary closely
with demographic variables. Another is that demographic variables are easier to measure than
most other types of variable. Even when market segments are first defined using other bases
-such as personality or behavior - their demographics need knowing to assess the size of the
target market and to reach it efficiently. The variables considered in demographic
segmentation are:
 Age
 Gender
 Family size
 Family life cycle
 Income
 Occupation
 Education
 Religion
 Race
 Nationality
Psychographic Segmentation:
Dividing a market into different groups based on social class, lifestyle or personality
characteristics. Variables considered are:
 Social class
 Lifestyle
 Personality
Behavioral Segmentation:
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Behavioral segmentation divides buyers into groups based on their knowledge, attitudes, uses
or responses to a product. Many marketers believe that behavior variables are the best starting
point for building market segments.
The variables considered in behavioral segmentation are:
 Purchase occasion
 Benefits sought
 User status
 Usage rate
 Loyalty status
 Readiness state
 Attitude towards product
The Process of Market Segmentation:

Market segmentation process is a systematic procedure but sometimes marketers segment
their market intuitively on the basis of experience and following the competitors and earlier
market entrants.
The real way of segmenting a market is to perform a structured analysis, usually supported by
some market research, in order to identify segments and measure their potential.
Segmentation policy of our company is not on the basis of intuition rather we have followed
all steps of market segmentation to segment our target market. Before segmenting a market, it
is necessary to all organizations to have a complete know how about the levels, patterns, and
procedure and characterizes of effective market segmentation.
LEVELS OF SEGMENTATION:
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Mass Marketing:
“In mass marketing, the seller engages in the mass
production, mass distribution, and mass promotion
of one product for all buyers in about the same way”.
Mass production and mass distribution, which leads to the lowest costs, which in turn can
translate into either lower prices or higher margins.
Segment Marketing:
A company that practices segment marketing recognizes that buyers differ in their needs,
perceptions and buying behaviors.
“The company tries to isolate broad segments that

make up a market and adapts its offers to match
more closely the needs of one or more segments”.
The company can market more efficiently, targeting its products or services, channels and
communications programmers towards only consumers that it can serve well. The company
can also market more effectively by fine-tuning its products, prices and programmed to the
needs of carefully defined segments. And the company may face less competition if fewer
competitors are focusing on this market segment.
Niche Marketing:
“Niche marketing focuses on subgroups within these segments”.
A niche is a more narrowly defined group, usually identified by dividing a segment into sub-
segments or by defining a group with a distinctive set of traits who may seek a special
combination of benefits. Segments are fairly large and normally attract several competitors;
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niches are smaller and normally attract only one or a few competitors. Niche marketers
presumably understand their niches' needs so well that their customers willingly pay price
premium. In many markets today, niches are the norm.
Local Marketing:
“Local marketing involves tailoring brand
and promotions to the needs and wants
of local customer groups - cities,
neighborhoods and even specific stores”.
Local marketing has some drawbacks. It can drive up manufacturing and marketing costs by
reducing economies of scale. It can also create logistical problems as companies try to meet
the varied requirements of different regional and local markets. And a brand's overall image
may be diluted if the product and message vary in different localities. Still, as companies face
increasingly fragmented markets, and as new supporting technologies develop, the
advantages of local marketing often outweigh the drawbacks. Local marketing helps a
company to market more effectively in the face of pronounced regional and local differences
in community demographics and lifestyles.
Individual Marketing:
“Individual marketing is tailoring products

and marketing programmes to the needs
and preferences of individual customers”.
Individual marketing has also been labeled 'markets-of-one marketing', 'customized

marketing' and 'one-to-one marketing'. It can be referred as mass customization. ''Mass
customization is the ability to prepare on a mass basis individually designed products and
communications to meet each customer's requirements
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Patterns of Market Segmentation:
Homogeneous preferences
All the consumers have roughly the same preference. The market shows no natural segments.
We would predict that existing brands would be similar and cluster around the middle of the
scale.
Diffused preferences
At the other extreme, consumer preferences may be scattered throughout the space, indicating
that consumers vary greatly in preferences. The first brand to enter the market is likely to
position in the center to appeal to the most people. A brand in the center minimizes the sum
of total consumer dissatisfaction. A second competitor could locate next to the first brand
and fight for market share. Or it could locate in a corner to attract customer group that was not
satisfied with the center brand. If several brands are in the market, they are likely to position
throughout the space and show real differences to match consumer-preference differences.
Clustered preferences
The market might reveal distinct preference cluster; natural market segments. The first firm
in this market has three options. It might position in the center, hoping to appeal to all groups.
 It position in the largest market segment
 It might have several brands, each positioned in a different segment.
 If the first firm developed only one brand, competitors would enter and introduce
brands in the other segments.
“The fabric softener level of segmentation is Segment Marketing as company Is offering the
same product in all the different segments. Patter of segmentation is homogenous preferences
as all the individual seek more or less the same benefits from the product and have the same
preferences.
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EVALUATION REGARDING MARKET SEGMENTATION:
In evaluating different market segments, a firm must look at two dimensions; segment
attractiveness and company resources and objectives.
Segment Attractiveness:
Segments with the right size and growth characteristics are interesting. But 'right size and
growth' are relative matters. A segment might have desirable size and growth and still not be
attractive from a profitability point of view. The company must examine several significant
structural factors that affect long-run segment attractiveness.
 The company should assess current and potential competitors. A segment is less
attractive if it already contains many strong and aggressive competitors.
 Marketers also should consider the threat of substitute products. A segment is less
attractive if actual or potential substitutes for the product already exist. Substitutes
limit the potential prices and profits from segments.

 The relative power of buyers also affects segment attractiveness. If the buyers in a
segment possess strong or increasing bargaining power relative to sellers, they will try
to force prices down, demand more quality or services, and set competitors against
one another.
 Segment attractiveness depends on the relative power of suppliers, a segment is less
attractive if the suppliers of raw materials, equipment, labor and services in the
segment are powerful enough to raise prices or reduce the quantity of ordered goods
and services. Suppliers tend to be powerful when they are large and concentrated,
when few substitutes exist, or when the supplied product is an important input.
Company Resources and Objectives:
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Even if a segment has the right size and growth and is structurally attractive, the company
must consider its objectives and resources for that segment. It is best to discard some
attractive segments quickly because they do not mesh with the company’s long-run
objectives. Although such segments might be tempting in themselves, they might divert the
company's attention and away from its main goals.
Segmentation Variables for Fabric Softener Segmentation:

Type of product according to the market being served Consumer Product
Segmentation on the basis of the Consumer Market Segmentation Variable
1. Geographic segmentation:
 Region of country …………………... Punjab

 Climate …………………... Mixed
2. Demographic Segmentation:
 Age …………………... For every age

 Income …………………… For any income group
 Social class ……………………. For every class
3. Behavioral Segmentation:
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 Benefits sought …………………. Softness of clothes, Color retention of fabrics.
 Usage rate …………………. On average once a week.
 User status …………………. Segment contains potential customers.
 Occasions …………………. Around the year more in winter seasons.
The fabric softener benefits are two dimensional, functional and emotional. Both works
together to create overall consumer perception and the product appeal. The major functional
benefits provide by the fabric softener are softness, perfume, antistatic properties and ease of
ironing.
The major emotional benefits are tenderness, pleasure, well being, and sense of care for the
family. These emotional benefits are generally reinforced by the communication on the labels
and the advertisement. The relative importance of functional and emotional benefits are
highly variable and are generally linked to the cultural, psychological and life-style factors.
Level of Segmentation …………………. Segment Marketing
Pattern of Segmentation …………………. Homogenous Pattern
SELECTING THE TARGET MARKET:
“A target market consists of a set of buyers

who share common needs or characteristics
that the company decides to serve”.
When a segment fits the company's strengths, the company must then decide whether it has
the skills and resources needed to succeed in that segment. Each segment has certain success
requirements. If the company lacks and cannot readily obtain the strengths needed to compete
successfully in a segment, it should not enter the segment. Even if the company possesses the
50

required strengths, it needs to use skills find resources superior and differentiated to those of
the competition to really win in a market segment. The company should enter segments only
where it can offer superior value and gain advantages over competitors.
PATTERN OF TARGET MARKET:
Company can consider five different patterns of target market selection.
□ Single segment concentration

□ Selective specialization
□ Product specialization
□ Market specialization
□ Full market coverage
Single segment concentration

The company may select a single segment, through concentrated marketing the firm gains a
strong knowledge on the segment’s needs and achieves a strong market presence. If it
captures segment leadership the firm can earn high return on investment. Through
concentrated marketing, a firm can achieve a strong market positioning; it also enjoys many
operating economies because of specialization in production, distribution and promotion.
Selective specialization
The firm selects a number of segments, each with different attractiveness. Segments can be
remarkably different but each segment proves to be money maker.
Product Specialization
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The firm specializes in making a certain product that it sells to several segments. Through a
product specialization strategy, the firm builds a strong reputation in the specific product
area. The risk is that the product may be replaced by an entirely new technology.
Market Specialization
The firm concentrates on serving many needs of a particular customer group. The firm gains a
strong reputation in serving this customer group and becomes a channel for further products
that the customer group could use.
Full market coverage

A firm attempts to serve all customer groups with all the products they might need. Only
very large firms can undertake a full market coverage strategy. Large firms can cover a whole
market in two broad ways:
 Un-differentiated marketing
 Differentiated marketing.
In undifferentiated marketing, the firm ignores market-segment differences and goes after
the whole market with one market offer. It focuses on a basic buyer need rather than on
differences among buyers. It designs a product and a marketing program that will appeal to
the number of buyers. It relies on mass distribution and mass advertising. It aims to endorse
the product with a superior image in people's minds. Undifferentiated marketing is the
marketing opposite to mass production.
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In differentiated marketing, the firm operates in several market segments and designs
different programs for each segment.
The pattern of target market for our product is Product specialization as we are providing
same product for the market satisfying the needs of all the costumers in a market.
TARGET MARKET PATTERN FOR THE FABRIC SOFTENER
Pattern of target market for the fabric softener is Product Specialization. The firm specializes
in making a certain product that it sells to several segments. Through a product specialization
strategy, the firm builds a strong reputation in the specific product area. The risk is that the
product may be replaced by an entirely new technology.
POSITIONING:
“The way the product is defined by consumers

on important attributes or the place the product
occupies in consumers' mind relative to the
competitors products.”
POSITIONNG STRATEGIES:
Marketers follow several strategies to position their products.
 Product Attributes
 Products Benefits
 Product Usage Occasions
 According to certain classes of users
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 Against a Competitor
 Away from Competitor
 Product Class Positioning
CHOOSING AND IMPLEMENTING POSITIONG STRATEGY:
First a firm has to choose the right kind of the positioning strategy and then comes the
implementation step. The positioning task consists of the following steps.
1. Identify possible competitive advantage on which we want to build a

position
2. Selecting the right competitive advantage
3. Effectively communicating and delivering chosen position.
IDENTIFY POSSIBLE COMPETITIVE ADVANTAGE:
“Competitive advantage is the advantage over competitors

gained by offering consumers greater value, either through
lower prices or by providing more benefits that justify higher prices.”
Consumers typically choose products and services that give them the greatest value. The key
to keeping customers is to understand their needs and buying preferences better than
competitors, and to deliver more value. A company can position itself as providing superior
value to selected target markets, either by offering lower prices than competitor’s do or by
providing more benefits to justify higher prices.
Positioning therefore begins with differentiating the company's marketing offer; so that it will
give consumers more value than competitors'. It is not just a matter of being different;
success comes from being different in a way that customers want.
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DIFFERENTIATING MARKETS:
A company differentiates its offer from those of competitors in the following ways.
PRODUCT DIFFERENTIATION
A company can differentiate its physical product. Some companies offer highly standardized
products that allow little variation, other companies offer products that can be highly
differentiated, It can offer a variety of standard or optional features not provided by
competitors.
 Companies can also differentiate their products on performance.

 Similarly, companies can differentiate their products on such attributes as
consistency, durability, reliability or repair ability.
 Services Differentiation: In addition to differentiating its physical product, the firm
can also differentiate on the basis of services that accompany the product.
 Some companies gain competitive advantage through speedy or careful
delivery.
 Companies can further distinguish themselves through their repair
services.
 Some companies differentiate their offers by providing a customer
training service.
In fact, they can choose from a virtually unlimited number of specific services and benefits
through which to differentiate them from the competition.
PERSONNEL DIFFERENTIATION:
Companies can gain a strong competitive advantage through hiring and training people better
than their competitors do. Personnel differentiation requires that a company should select its
customer contact people carefully and train them well. These personnel possess the required
55

skills and knowledge. They need to be courteous, friendly and respectful. They must serve
customers with consistency and accuracy. And they must make an effort to understand
customers, to communicate early with them, and to respond quickly to customer requests and
problems.
IMAGE DIFFERENTIATION:
Buyers may perceive a difference based on company or brand images. Thus companies’
works to establish images that differentiate them from competitors. A company or brand
image should convey distinctive message that communicates the product's main benefits and
positioning. Developing a strong and distinctive image calls for creativity and hard work. A
company cannot implant an image in the public’s mind overnight using only a few
advertisements.
SELECTING THE RIGHT COMPETITIVE ADVANTAGES:
If a company is fortunate enough to have several potential competitive advantages, it must

now choose the ones upon which it will build its positioning strategy.
 It must decide how many differences to promote and which ones.
 A company should develop a unique selling proposition (USP) for each brand and
stick to it.
 The difficulty of keeping functional superiority has made firms focus on having a
unique emotional selling proposition (ESP) instead of a USP. The product may be
similar to competitors', but it has unique associations for consumers.
Which Differences to Promote?

Not all brand differences are meaningful or worthwhile. Not every difference makes a good
differentiator. Each difference has the potential to create company costs as well as customer
benefits. Therefore, the company must carefully select the ways in which it will distinguish
56

itself from competitors. A difference is worth establishing insofar as it satisfies the following
criteria: Important. The difference delivers a highly valued benefit to target buyers.
Distinctive: Competitors do not offer the difference or the company can offer it in a more
distinctive way. The difference is superior to other ways that customer might obtain the same
benefit.
Communicable: The difference is communicable and visible to buyers.
Pre-emptive: Competitors cannot easily copy the difference.
Affordable: Buyers can afford to pay for the difference.
Profitable: The Company can introduce the difference profitably.
COMMUNICATING AND DELIVERING THE CHOSEN POSITION:

Once it has chosen a position, the company must take strong steps to deliver and
communicate the desired position to target consumers. All the company’s marketing-mix
efforts must support the positioning strategy. Designing the marketing mix - product, price,
place and promotion - involves working out the tactical details of the positioning strategy. It
must hire and train more service people, find retailers that have a good reputation for service,
and develop sales and advertising messages that broadcast its superior service. This is the
only way to build a consistent and believable high-quality, high-service position.
POSITIONING STRATEGY FOR THE FABRIC SOFTENER:

PRODUCT ATTRIBUTES:
The positioning strategy selected for the fabric softener is on the basis of the product
attributes.
 Softness
 Color Care
 Ease of ironing
 Fragrance
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 Long Lasting Freshness
 Skin Mildness
 Luxury and Comfort
COMPETITIVE ADVANTAGE:
 High quality product
 Affordable prices
6. BUSINESS ANALYSIS:
In this step companies take a review of the sales, costs and profit projections for a new
product to find out whether these factors satisfy the company’s objectives. If they do, the
product can move to the product development stage.
We took the analysis of following factors:
 Demand estimation
 Cost figures
 Capital demands
 Price of the product
Demand Estimation:
Whenever any product is developed and launched in the market the success of the product
depends on the correct estimation of the demand of the product. The R & D department plays
58

an important role in this regard. They use different demand estimation tools and techniques to
estimate the exact demand as it is the estimation on which the company is dependent for the
production and hence the manufacturing cost.
Cost Figures:
The amount of money, time, or energy required to obtain or produce something is called cost.
The company wants to charge a price that covers its cost of producing, distributing, and
selling the product, including a fair return for its effort and risk.
Direct cost are the ones without which the product cannot come into being whereas the
indirect are the ones without the product can exist physically.
Direct Material Cost per Liter:

COMPONENTS Quantity in ml Rate (Rs) Price per liter
Deionized Water(H2O) 680 10/liter 13.6
Sodium Carbonate 75 90/kg 6.75
Sodium Omadine 17.5 500/liter 8.75
Amino Silicon 32.5 260/kg 8.45
Formaldehyde 22 800/liter 18.7
Methyl Jasmonate 30 375/liter 11.25
Methyl Acrylate 20 400/liter 8.00
Dimethyldicholorosilane 95 1500/kg 33
Diphenyloxide Disodium Salt 6 1200/kg 7.2
Fluorescent Brightener 95 225/kg 21.375
TOTAL 1000ml 137.075
TABLE 1: DIRECT MATERIAL COST
Bottle Cost = Rs2/ bottle
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Direct Labor Cost:
Six personnel working on four plants namely:
2 personnel operating Water treatment Plant
2 Personnel operating Mixing Vessel
1 Personnel operating Bottling line
1 Personnel operating Labeling Machine
Rate of wage = Rs 200/day
Total Labor Expense = 6 x 6000 = Rs. 36,000 /month
Factory over Head:

1. Depreciation
Useful Life in Annual Monthly Amount

Asset Name Cost (Rs)
(Years) Amount (Rs) (Rs)
Water
8000000 35 220000 18333
Treatment Plant
Mixing Vessel 4500000 30 140000 11667
Bottling Line 2500000 15 153333 12777
Labeling Line 700000 10 50000 4167
Depreciation rate
Building 9000000 1080000 90000
(12%)
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Total 24700000 1643333 136944
Table 2: DEPRECIATION VALUES
2. Label Cost = Rs 0.75/bottle

3. Electricity Bill = 125,000
Fixed = 25,000
Variable = 100,000
4. Insurance Payments = 24,000
5. Indirect Labor
4- Supervisor 8,000 x 4 = 32,000
2- Security guard 5,000 x 2 = 10,000
2- Electrician 4,000 x 2 = 8,000
2- Sweeper 3,000 x 2 = 6,000
2- Peon 3,000 x 2 = 6,000

6. Others (Packing Material, Prepayments) = 50,000
PRODUCTION CAPACITY:
Daily = 18,000 units
Monthly = 468,000 units
As we are introducing our product in two ranges i.e. 500ml and 250ml bottle range the 75%
of production would be in the 250ml range and the remaining 25% would be in the 500 ml
range.
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COST OF PRODUCTION
75% of 468,000 = 351,000 units of 250 ml bottle
25% of 468,000 = 117,000 units of 500 ml bottle
Cost of Production of 351,000 units = 351,000 x 36.28 = Rs 12,734,280/month

Cost of Production of 117,000 units = 117,000 x 72.56 = Rs 8,489,520/month
CAPITAL DEMAND:
WATER TREATMENT PLANT
Figure 3 WATER TREATMENT PLANT
The reverse osmosis device is an equipment to purify the raw water with the action of
pressure difference of permeable membrane. This system has two parts: One is pre-filtration
62

and the other is RO purification. The latter is the main equipment and the other one is for
assistance.
Price = Rs 8000000
Design
1. Output water quality: International drinkable water standard (WHO)
2. Output water capacity: 1000 ~ 5000 L/h Reverse osmosis
3. System running: Could be 24 hours one day
4. Water resource supply: Continuously
5. Purified water supply: Continuously

6. Operation mode: Auto control and parts of manual control
MIXING VESSEL
FIGURE 5 MIXING VESSEL

FIGURE 4 MIXING VESSEL
Price = Rs 4500000
DETAILED DESCRIPTION
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Vessel, chemical tank, stainless steel tank has capacity of 5000L (individual). The single
layer has the thickness of 5mm; with top and bottom end and with the Manhole 600*600mm
inside and outside mirror polishing. The diameter is 1600mm. Height of the vessel is
3150mm. With a spraying ball inside
for cleaning with inlet opening.
Material Used: Stainless Steel
304(connecting with the material)
With legs, the height can be customized
15KW Propeller Mixer
Power Supply: 380V, 60Hz, 3 Phases
Power: 15KW ABB Motor, Ex-proof
Rotation Speed: 0- 120 rpm
Three layer propeller, which is removable
BOTTLING LINE
FIGURE 6 BOTTLING LINE
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Price = Rs 2500000
KEY SPECIFICATIONS
Applies for washing, filling and capping all shapes of small PVC, PET bottles
Automatic bottle washing, filling and sealing processing fission block unit
Suspension technology and neck locking structure to assure the convenience of changing
bottles
Whole equipment controlled by PLC system
Equal pressure filling in high accuracy
Capping system in magnetic technology with non-hurting
Cap sorter in rotary running with check sensors
Low noise transmission, running and working
Bottle sizes can be customized
Production capacity: 1500 bottles per hour (based on 500mL bottle)
Line including: 2 units of worktable, 1 unit of bottle washing, 1 unit of bottle filling, 1 unit of
bottle capping, 1 set of conveyor belt
Washing heads: 14
Filling nozzles: 12
Capper: 1
LABELING MACHINE
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Figure 7 LABELING MACHINE Figure 8 LABELING MACHINE
Price = Rs 700000
KEY SPECIFICATIONS
Applications:
Suitable label for various round bottle of PET
bottle, drug bottle, salad oil bottle, wine, soy bottle
and conical bottle and more
Features:
If also can design labeling front and back of round bottle or just label neck of bottle
PLC control system match human machine interface is easy to read and operate
Memory capacity up to 60 sets labeling parameters for fast change of production conditions
Entire machine is constructed of S304 stainless steel, and aluminum alloy for rust free
performance.
Specifications:
Labeling speed: 0-25m/min (adjustable)
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Labeling accuracy: around 1mm
Roll inter: 3"or 75mm
Roll outer: below 360mm
Power source: 110V/220V, 50/60Hz
Standard label height: below 130mm
Maximum label height: 200mm
Machine dimensions: 2, 014(L) x 900(W) x 1, 320(H) mm
Machine weight: 75kg.
PRICE OF THE PRODUCT:
Price of 500 ml Bottle Amount (Rs)
72.56
Cost Price of 500 ml bottle
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14.51
Profit (20% of cost price)
Total 87.1
Distributor Functional discount (5%) 4.355
Total 91.455
Retailer Standard Discount (1%) 0.91
92.36
Retail Price
14.78
Sales Tax (16%)
107.14
Sales Price
TABLE 3 PRICE OF 500ml BOTTLE
Price of 250 ml Bottle Amount (Rs)
36.28
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7.256
Total 43.536
Distributor Functional discount (5%) 2.1786
Total 45.7128
Retailer Standard Discount (1%) 0.4571
46.17
Retail Price
7.39
Sales Tax (16%)
53.56
Sales Price
7. PRODUCT DEVELOPMENT:
“Product development means to develop

the product concept into a physical product
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in order to ensure that the idea can be turned
into a workable product”.
Fabric Softener
Everyone of us have experienced the stiffening and curling up of clothes especially of

sweaters, towels, socks, T-shirts, shawls, woolen and velvet fabrics, socks . There is variety
of reasons for this problem.
The fibers in the fabrics retain the detergents residue even after we cannot get rid of the
detergent residue. The chemicals in the detergents have different charges and bind them to
the fibers of the clothes, resulting in the stiffness of the fabrics.
One of the reasons is static cling. Cling is a manifestation of static electricity. Each atom has
a nucleus that consists of Protons and Neutrons, and Electrons that orbit around the nucleus.
Protons have positive (+) charge, Neutrons are neutral, and Electrons have negative (-)
charge. Normally the Protons and Electrons have parity in numbers as well as force and
therefore the atom as such is without charge. But sometimes an Electron might migrate to
another atom due to friction or other reasons, upsetting the equilibrium. That results in a
charge known as static electricity. This energy remains stagnant unless it is eliminated or
diffused.
When clothes made of certain fibers—typically, woolen clothes, synthetic materials like
polyester—rub against each other or against dry skin they create static electricity. Such
clothes will cling together. With these materials, some take on a positive (+) charge and same
have a negative (−) electrical charge, thus causing them to attract or cling. Clothing with
similar charges repels each other, but that is not noticeable as is the clinging effect.
Some clothes made of these materials will also start to cling to your legs as you walk,
especially on days were the humidity is low or the air is dry. The skin becomes positive (+) in
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charge and the polyester clothes gain a negative (−) charge, thus causing them to attract. The
cellulose fabrics also give a harsh feel after washing. Many methods are used by the
households in order to overcome these problems. Some conventional methods used by
households are as follows:
1. Vinegar and baking soda both are added to laundry in the rinse cycle.
2. Other method is to add vinegar in water and dip the cloth in it after rinsing.
3. Solution of Vinegar and Baking Soda:
1 part Vinegar
1 part Baking Soda
2 parts Hot Water
Mix the baking soda and hot water, stir till the powder is dissolved. Then add the vinegar.
Baking soda and vinegar reacts with fizzing in this solution the baking soda won’t dissolve
completely, so thorough shaking before use is required, resulting in reduced shelf life.
Merits and Demerits of Vinegar Use:
Vinegar is beneficial in:
Removing soap residue from clothes and softening laundry articles
But it has the following disadvantages:
 Vinegar added during the rinse cycles reacts with the detergents and changes the Ph of
water. It leads to the brittleness of detergents causing insolubility and failing the
ultimate purpose of detergents i-e proper cloth cleaning.
 Vinegar added after rinse cycle leads to very unpleasant smell. Both of these methods
require extra efforts. These methods are also costly as vinegar in large volume is
required which is not economical.
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DEVELOPMENT OF FABRIC SOFTENER
By keeping in mind all the above considerations, the R&D department researched a lot and
developed a trial model of the product that could overcome the disadvantages of using
conventional methods for softening of clothes. Their research resulted in a multi-functional
fabric softener. They developed and tested many physical versions of the product concept.
They make such model of the product which can satisfy and excite the consumers and also
can be produced quickly and at budgeted costs.
ATTRIBUTES OF FABRIC SOFTENER:
Product development chemists created fabric softener that is designed to meet a series of
specific customer and marketing requirements.
First, the formulations must deliver a variety of attributes desired by consumers such as
superior softness
 Improved iron glide

 Improved wrinkle removal after washing
 Better color retention
 Long lasting freshness
 Safe to use
 Environmentally friendly
 Aesthetically pleasing
 Cost effective.
BASIC FORMULATION OF PRODUCT:
COMPONENTS FUNCTIONS PROPORTION
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Deionized Water(H2O) Main solvent 68%
Sodium Carbonate Emulsifier 7.5%
Sodium Omadine Preservative 1.75%
Amino Silicon Surfactants 3.25%
Formaldehyde Wrinkle Remover 2.2%
Methyl Jasmonate Perfuming agent 3%
Methyl Acrylate ph stabilizer 2%
Dimethyldicholorosilane Conditioning agent 9.5%
Diphenyloxide Disodium Salt Surfactants 2.2%
Fluorescent Brightener Color retainer 0.6%
TABLE 5 BASIC FORNULATION OF FABRIC SOFTENER
MAIN SOLVENT:
The main solvent used in the product is Deionized water. Deionized water is a type of
purified water with mineral ions (salts) removed. These mineral ions include sodium,
calcium, iron, copper, chloride, and bromide.
CONDITIONING AGENTS:
Conditioning agents are used to make the fabric soft and static cling free. They are also used
for their ability to improve the cleaning performance of detergents in hard water.
Conditioners mainly come from silane class of materials. Silane is a silicone based fluid that
has the ability to lubricate fibers to give improved softening and ease of ironing. The silanes
are water insoluble by their nature, they attach to the fabrics during the rinse cycle but do not
detach during the washing process. Conditioning agent is useful due to the fact that a part of
73

the molecule has a positive charge, which attracts and binds it to negatively charged fabric
fibers. This charge interaction also helps in dispersing the electrical forces, which are
responsible for static cling. The other part of the molecule is fatty in nature and hence offers
the slip and lubricity, which makes the fabric feel soft.
SURFACTANTS:
Surfactants are wetting agents that lower the surface tension of a liquid, allowing easier
spreading, and lower the interfacial tension between two liquids. The term surfactant is a
blend of surface acting agent.
Surfactants are usually organic compounds that are amphiphilic,

meaning they contain both hydrophobic groups (their "tails") and
hydrophilic groups (their "heads"). Therefore, they are soluble in both
organic solvents and water. Most surfactants consist of two parts, a
hydrophilic head group and one to four hydrophobic tail. The figure
aside shows schematic drawing of some surfactants.
Tails are good in solving oil and the head are good soluble in water the can bridge the gap
between hydrophobic and hydrophobic. This happen by forming aggregates with the oil in the
center and the ten sides around. The tails of the ten sides are oriented towards the oil while
the head face to the water. In this way the whole aggregate became water soluble, although
there is a lot of hydrophobic stuff inside.
EMULSIFIERS:
Emulsifiers are low molecular weight surfactants that are used to create the emulsions. In
order to achieve the emulsion the two requirements must be fulfilled: the surfactant must
reduce the oil water interfacial tension to low values and the surfactant must rapidly diffuse
so newly created interface. The last requirement is important as the high molecular weight
surfactants are good in stabilizing the oil water interface but these are all large molecules that
74

diffuse slowly to newly formed interface. Low molecular weight surfactants are therefore
preferable in creating emulsions i.e. dispersion of one non-miscible liquid droplet.
The emulsifiers are therefore more preferable in creating emulsion and the surfactants are
preferable in stabilizing the emulsions therefore a combination of both is used. It is also
found that the combination f surfactant is more superior to the individual surfactant. Good
emulsions are formed by using combination if surfactants as such the one is hydrophilic and
the other one is hydrophobic.
In the product sodium carbonate is used as emulsifier. Amino silicon is the hydrophobic
surfactant whereas Diphenyloxide disodium salt is hydrophilic surfactant.
PRESERVATIVE:
A preservative is a natural or synthetic chemical that is added to products such as foods,

pharmaceuticals, paints, biological samples, wood, chemical products etc. to prevent
decomposition by microbial growth or by undesirable chemical changes.
A biocide is a component which preserves the composition from attack by microorganisms

including bacteria, mildew, and fungus. Preferably, the biocide should interact with the
surfactant system. Biocide used in the product is sodium omadine.
WRINKLE REMOVER:
Wrinkle remover is designed to reduce the appearance of and even remove wrinkles from the
fabrics. The cross-linked hydrogen bonds keep in place the cellulose polymers in cellulose
fabrics such as cotton, hemp and flax. The hydrogen bonds are relatively weak and easily
broken by moisture. Once the hydrogen bonds holding the cellulose fibers in place are broken
75

by moisture, then the fibers can shift place and realign themselves and wrinkles are born in
cellulose-based fabrics.
Formaldehyde resins forms cross linking of formaldehyde and hydrogen atoms in the cotton’s
cellulose fibers; formaldehyde used not only create cross link bond with the hydrogen atoms
in the cellulose polymers which help wrinkle-resistance but also help protect from fabric
shrinking and improved color retention and color fastness.
pH STABILIZER:
pH is a measure of the acidity or basicity of a solution. It is defined as the co-logarithm of the

activity of dissolved hydrogen ions (H+). An alkaline source is used to raise the pH of the
wash water. It is preferred that the alkaline source does not contribute any odor. Alkaline
source used in product is sodium carbonate which also increases the detergency of
clay soils, fatty acids.
PERFUMING AGENT:
Perfume is a mixture of fragrant essential oils and aroma compounds, fixatives, and solvents
used to give a "pleasant" smell.
Product scent is the key characteristic as it is the feature with the consumers relates the most.
It should be aesthetically pleasing. Customer analysis in detergents shows that smell is the
one of the key reasons of choosing one product over the other and it also plays a major role in
shaping repurchase intention.
FLUORESCENT BRIGHTENER:
Optical brighteners, fluorescent brightening agents or fluorescent whitening agents (FWAs)

are dyes that absorb light in the ultraviolet and violet region (usually 340-370nm) of the
.These additives are often used to enhance the appearance of color of fabric causing a
76

perceived "whitening" effect, making materials look less yellow by increasing the overall
amount of blue light reflected.
A surface treated with an optical brightener can emit more visible light than that which shines
on it, making it appear brighter. The blue light emitted by the brightener compensates for the
diminishing blue of the treated material and changes the hue away from yellow or brown and
toward white.
THE PRODUCTION PROCESS:
1. The method for manufacturing liquid softeners involves heating the

ingredients together in one large mixing vessel. Mixing tanks are constructed
from high grade stainless steel to prevent attack from the corrosive agents in
the formula. The tank is typically equipped with a jacketed shell that allows
steam and cold water to be circulated, so the temperature of the batch can be
easily controlled. In addition the tank is fitted with a propeller type mixer that
is driven by a large electric motor. This kind of mixing blade provides the high
shear that is needed to properly disperse the ingredients. The first step in the
manufacturing process is to fill the tank with the specified amount of water.
Water is added first because it acts as a carrier for all the other ingredients.
Deionized water is used because it is free from metal ions that can affect the
performance of the batch.
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FIGURE 9 MIXING VESSEL WORKING
2. Once the water has been added to the tank, heating and mixing is initiated.
When the water has reached the appropriate temperature i-e 155-158F, the
emulsifiers are added. Since these chemicals tend to be waxy solid materials
they are added at relatively high temperatures (between 158-176TF [70-
78

80°C]). While the order of addition depends on the specific formula, it usually
more effective to disperse the emulsifiers prior to adding the less water-
soluble materials.
3. The conditioning ingredients used in softeners are not typically water soluble,
so they are added to the water phase after the emulsifiers. For concentrated
formulations, levels of 11% are used.
4. Heating and mixing continues until the batch is homogeneous. At this point
cool water is circulated around the tank to lower the temperature. As the batch
cools, the remaining ingredients, such as ph stabilizer, surfactants, emulsion
stabilizer, dewrinklizer, preservatives, and fragrance, are added. These
ingredients are used at much lower concentrations. When the batch is
complete, a sample is sent to the analytical chemistry lab to ensure it meets
quality control standards for solids, pH, and viscosity. The completed batch
may be pumped to a filling line or stored in tanks until it is ready to be filled.
5. When the product is ready to be filled into the package, it is transferred to an

automated filling line. Plastic bottles are fed onto a conveyor belt that carries
them under a filling nozzle. At the filling head there is a large hopper that
holds the formulation and discharges a controlled amount, usually set by
volume, into the bottle. The filled package continues down the conveyor line
to a capping machine that applies the closure and tightens it. Finally, the filled
bottles are packed in cartons and stacked pallets for shipping.
QUALITY CONTROL:
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The finished fabric softer formulations are tested using a number of different protocols.
Simple laboratory tests are used to determine basic properties such as pH, viscosity. These
tests can help confirm that the correct ingredients were added at the appropriate levels.
TEST RANGE
pH 5.5-8.5
Specific Gravity 1.05-1.25
Viscosity 3,000-20,000 cps
Color Pentane 297U(sky blue)
Fragrance Present
TABLE 6 QUALITY CONTROL TEST
Other, more rigorous, tests are done to ensure the formulation is functioning correctly. One
such evaluation is a water absorbency test, sometimes called the Drayes Wetting Test. This
procedure involves dropping small pieces of treated fabric onto water and recording the
length of time required for the fabric to sink. This measurement is taken 10 times to obtain an
average result.
Anti-wrinkle properties can be evaluated by asking panelists to rate samples of fabric before
they have been ironed. They are asked to numerically rate the amount of wrinkling between
the test sample and the fabric softener treated sample. The test to measure ease of ironing is
also done using trained panelists.
These tests are performed on swatches of identical fabrics with the only difference being that
one fabric has been treated with softener and the other has been washed in detergent only.
100% cotton pillowcases are used for wrinkling and ironing tests while 100% cotton terry
towels are used for evaluating softness and water absorbency. The swatches are dried in a
controlled environment at 71.6°F (22°C) and 65% relative humidity for 24 hours before
testing.
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HOW FABRIC SOFTENER WORKS:
During washing process the bonds of fabrics are broken resulting in the stiffness of most
clothing items. Fabric softener, smooth the fabrics by making bonds with these broken fabric
molecules. Fabrics Fabric softeners are positively charged. How fast they deposit on a
garment depends on the strength of the positive charge which they carry. This, in turn,
depends on the pH. In very acidic solutions softeners carry a higher charge and therefore are
depleted more rapidly. This is very undesirable, since it tends to leave fabrics with "hot
spots" or areas, which receive too much softener while other areas, receive little or none. The
ideal positive charge on a softener molecule occurs when the pH is kept between 6 and 7.
STATIC ELECTRICITY
Fabrics are poor conductors of electricity. When they tumble in a dryer or we air dry them the
fibers rub against each other producing static electricity. Softeners lubricate fibers during
drying, which prevents this static build up. Softeners also act as conductors though which any
residual static can be discharged.
8. TEST MARKETING:
“The stage of new product development

where the product and marketing program
tested in more realistic market settings”.
Test marketing gives the marketer experience with marketing the product before going to the
great expense of full introduction. It lets the company test the product and its entire marketing
81

program - positioning strategy, advertising, distribution, pricing, branding and packaging, and
budget levels - in real market situations.
The company uses test marketing to learn how consumers and dealers will react to handling,
using and repurchasing the product. The results can be used to make better sales and profit
forecasts. Thus a good test market can provide a wealth of information about the potential
success of the product and marketing program.
When using test marketing, consumer-products companies usually choose one of three
approaches
 Standard test markets

 Controlled test markets
 Simulated test markets
Standard Test Markets:

Using standard test markets, the company finds a small number of representative test cities,
conducts a full marketing campaign in these cities and uses store audits, consumer and
distributor surveys, and other measures to judge product performance. It then uses the results
to forecast national sales and profits, to discover potential product problems and to improve
the marketing program. Standard market tests have some drawbacks.
□ They can be costly
□ They may take a long time
Controlled Test Markets:

Several research firms keep controlled panels of stores which have agreed to carry new
products for a fee. The company with the new product specifies the number of stores and
geographical locations it wants. The research firm delivers the product to the participating
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stores and controls shelf location, amount of shelf space, displays and point-of- purchase
promotions, and pricing according to specified plans. Sales results are tracked to determine
the impact of these factors on demand.
Controlled test markets take less time than standard test markets (six months to a year).
Sometimes the limited number of small cities and panel consumers used by the research
services may not be representative of their products' markets or target consumers.
Simulated Test Markets:

Companies also can test new products in a simulated shopping environment. The company or
research firm shows, to a sample of consumers, ads and promotions for a variety of products,
including the new product being tested. It gives consumers a small amount of money and
invites them to a real or laboratory store, where they may keep the money or use it to buy
items. The researchers then ask consumers the reasons for their purchase or non-purchase.
Some weeks later, they interview the consumer by phone to determine product attitudes,
usage, and satisfaction and repurchase intentions.
They usually cost much less, they are fast and inexpensive, and they can be run to assess
quickly a new product or its marketing program.
Test Marketing for fabric Softener:

For our test marketing we have used controlled test marketing strategy. The company
specified the number of stores and geographical locations it wants. The research firm delivers
the product to the participating stores and controls
 Shelf location
 Amount of shelf space
 Displays
 Point-of- purchase promotions
83

 Pricing according to specified plans.
Sales results are tracked to determine the impact of these factors on demand.
9. COMMERCIALIZATION:
“Commercialization is introducing the new product into the market”.
The company launching a new product must make four decisions. The first decision is
introduction timing - whether the time is right to introduce the new product.
When?
The first decision is introduction timing - whether the time is right to introduce the new
product.
First Entry:
The first firm entering a market usually enjoys the “first-mover advantage” of locking up the
most of the distribution channels and customers and gaining reputation of leader. Bur if the
product is rushed to the market before it is thoroughly tested and proper time for development
is not given, the product image will be crushed.
Parallel Entry:
The firm might time its entry to the same time when the competitor is entering the market.
The market pays more attention when two companies are advertising the new product.
Late Entry:
The firm may delay its launch until after the competitor has entered. The competitor will have
to bear the cost of educating the customers. It may also reveal faults that the late entrant can
avoid.
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Where?
The company must decide where to launch the new product. Should it be in single location,
or region, several regions, the national market or the international market? Few companies
have the confidence, capital and capacity to launch new products into full national or
international distribution. They will develop planned market rollout over time. In particular,
small companies may enter attractive cities or regions one at a time. Larger companies may
quickly introduce new products into several regions or into the national market.
To Whom?
The company must target its distribution and promotion to customer groups who represent
the best prospects. These prospects should have been selected by the firm in earlier research
and test marketing.
How?
The company also must develop an action plan for introducing the new product into the
selected markets. It must spend the marketing budget on the marketing mix and various other
activities.
COMMERCIALIZATION PLAN FOR FABRIC SOFTENER:

When:
Being the first one to introduce the fabric softener in Pakistan. We as initiators, enjoy the first
mover advantage.
Where:
Based on geographic segmentation, our segment is Punjab province in Pakistan and the
targeted markets are:
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 Lahore District
 Rawalpindi District
 Gujranwala District
 Faisalabad District
To Whom:
Based on demographic and behavioral segmentation the target market is:
Demographic Segmentation:
 Age …………………... Useful for every age group

 Income …………………… Above 15,000
 Social class ……………………. Middle Class and above
Behavioral Segmentation:
 Benefits sought …………………. Softness of clothes, Color retention of fabrics.

 Usage rate …………………. On average once a week.
 User status …………………. Segment contains prospects.
 Occasions …………………. Around the year more in winter seasons.
How:
It involves the marketing mix, the four “P’s
 Product : Consumer product with excellent attributes
 Price : At affordable price
 Place: We will sell our product through distributors.
 Promotion: Through electronic and print media, display media.
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MARKETING MIX:
In order to achieve your marketing objectives you need to have a strategy that includes
different elements - the various parts of the marketing mix. Calling it a mix reminds you to
try and get the balance right between the different elements. Marketing mix will be consisted
on following points:-
 Product
 Price
 Place
 Promotion
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FIGURE 10 MARKETING MIX

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WHAT IS A PRODUCT?
A product is anything that can be offered to a market for attention, acquisition, use, or
consumption that might satisfy a want or need. It could be a good, service, place, person, or
idea. The term product means all the tangible, physical and all the services of the company.
IMPORTANCE OF PRODUCT DECISION:
Marketing starts with the product since it is what an organization has to offer to its target
market. Organizations attempt to provide solutions to a target market’s problems. These
solutions include tangible or intangible (or both) product offerings marketed by an
organization.
In addition to satisfying the target market’s needs, the product is important because it is how
organizations generate revenue. It is the “thing” that for-profit companies sell in order to
realize profits and satisfy stakeholders and what non-profit organizations use to generate
funds needed to sustain it. Without a well-developed product strategy that includes input
from the target market, a marketing organization will not have long-term success.
CLASSIFICATION OF PRODUCTS:
Products can be classified depending on who the final purchaser is. To design effective
marketing programs, organizations need to know what kinds of products they are offering to
potential customers. So there are two types of products.
CONSUMER PRODUCTS:
Consumer products are the products which are bought by final consumer for personal
consumption purpose not fro resale or further processing.
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BUSINESS PRODUCTS:
Business products are the products which are bought by individuals and organizations for
further processing or for use in conducting a business.
Our product is related to Consumer products as we are making fabric softener, a cloth
softening agent which is a consumer product being targeted at the households not on the
business units.
CATEGORIES OF CONSUMER PRODUCTS:
FIGURE 11 CATEGORIES OF CONSUMER PRODUCTS

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CONVENIENCE PRODUCTS:
A consumer product that the customer usually buys frequently and with a minimum of
comparison and buying effort. They are usually low priced and widely available.
SHOPPING PRODUCTS:
These are products consumers purchase and consume on a less frequent schedule as
compared to convenience products. Consumers are willing to spend more time locating these
products since they are relatively more expensive than convenience products and because
these may possess additional psychological benefits for the purchaser, such as raising their
perceived status level within their social group.
SPECIALTY PRODUCTS:
These are products that tend to carry a high price tag relative to convenience and shopping
products. Consumption may occur at about the same rate as shopping products but consumers
are much more selective. The target markets are generally very small and outlets selling the
products are very limited to the point of being exclusive.
EMERGENCY PRODUCT:
These are products a customer seeks due to sudden events and for which pre-purchase
planning is not considered. Often the decision is one of convenience (e.g., whatever works to
fix a problem) or personal fulfillment (e.g., perceived to improve purchaser’s image).
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UNSOUGHT PRODUCTS:
These are products whose purchase is unplanned by the consumer but occur as a result of
marketer’s actions. Such purchase decisions are made when the customer is exposed to
promotional activity, such as a salesperson’s persuasion or purchase incentives like special
discounts offered to certain online shoppers.
IMPULSE PRODUCTS:
These are products whose purchase is unplanned by the consumer and are bought quickly.
Such purchase decisions are made when the customer is entered in the shop to purchase the
required product and suddenly sees a product in the shop and feel a need of that and
purchases.
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PRODUCTS OF “SOFT TOUCH”
Our first product was the washing soap
“WASH NOW”
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Our second product was the washing powder
“QUICK CLEAN”
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NOW WE ARE LAUNCHING NEW PRODUCT A “FABRIC SOFTENER”
“BUBBLES”
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PRODUCT DECISIONS OF FABRIC SOFTENER
Product Name Bubbles –Fabric Softener
Product Type Shopping Product
Brand Name SOFT TOUCH
Brand Slogan
Touching Lives,
Improving Lives
Product Size 250ml, 500ml
Product Quality Medium Quality
Product Bottle Color Sky Blue Color
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PRICE
One of the four major elements of the marketing mix is price. Pricing is an important
strategic issue because it is related to product positioning. Price can be defined as
“The amount of money charged for a product or service,

or the sum of the values that consumers exchange for the
benefits of having or using the product or service”.
Part art, part science, pricing is perhaps the most important of the four Ps of marketing. Price
is the only element in the marketing mix that produces revenue; all other elements represent
costs. Price is also one of the most flexibly elements of the marketing mix. Unlike product
features and channel commitments, price can be changed quickly.
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Pricing strategies usually change as the product passes through its life cycle. The introductory
stage is especially challenging. Companies bringing out an innovative, product faces the
challenge of setting prices for the first time. They can choose between two strategies:
 Market-Skimming pricing
 Market- Penetration pricing
MARKET-SKIMMING PRICING
Setting a high price for anew product to skim maximum revenues layer by layer from the
segments willing to pay the high price; the company makes fewer but more profitable sales.
MARKET- PENETRATION PRICING

Setting a low price for a new product in order to attract large numbers of buyers and a large
market share. The initial low price is set in order to penetrate the market quickly and deeply
to attract a large number of buyers quickly and win a large market share. The high sales
volume results in falling costs, allowing the company to cut its price even further.
PRICING STRATEGY FOR “BUBBLES” FABRIC SOFTENER

As the fabric softener is a new product to the market the aim of the organization is to capture
the maximum market share resulting in high sales volume. The market we are targeting is
price sensitive so setting a low price and providing quality product will enable the
organization to achieve its objectives.
HOW TO SET THE PRICE?
The firm has to consider many factors in setting its pricing policy. It is a six-step procedure:
1. Selecting the pricing objective
2. Determining demand
3. Estimating costs
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4. Analyzing competitors' costs, prices, and offers
5. Selecting a’ pricing method
6. Selecting the final price
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1. SELECTING THE PRICE OBJECTIVE
The company first decides where it wants to position its market offering. The clearer a firm's
objectives, the easier it is to set price. A company can pursue any of five major objectives
through pricing:
 Survival
 Maximum current profit
 Maximum market share
 Maximum market skimming
 Product-quality leadership.
The pricing objective of our company is to capture the maximum market share.
2. DETERMINING DEMAND
Each price will lead to different level of demand and will have different impact on a
company's marketing objectives. The relation between alternative prices and the resulting
current demand is captured in a demand curve. In the normal case, demand and price are
inversely related: the higher the price, the lower is demand. In the case of prestige goods, the
demand curve sometimes slopes upward. This is known as price elasticity of demand that
how the demand of a product is affected by the change in the prices.
Our product is the normal product not the prestige product therefore the inverse relation
between the price and demand exists. We have to set the price of our product that enables us
to increase the demand of the product and also foil us from any of our competitors also.
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3. ESTIMATING COST
The amount of money, time, or energy required to obtain or produce something is called cost.
The company wants to charge a price that covers its cost of producing, distributing, and
selling the product, including a fair return for its effort and risk.
TYPES OF COSTS AND LEVELS OF PRODUCTION
Any company's costs take two forms, fixed and variable.
 Fixed costs are costs that do not vary with production or sales revenue. A company
must pay bills each month for rent, heat, interest, salaries, and so on, regardless of
output. The total cost is fixed in total value and is variable for each unit. With the
increase in production the total cost per unit decreases.
 Variable costs vary directly with the level of production. These costs tend to be
constant per unit produced. They are called variable because their total varies with the
number of units produced.
 Total costs consist of the sum of the fixed and variable costs for any given level of
production.
 Average cost is the cost per unit at that level of production; it is equal to total costs
divided by production. Management wants to charge a price that will at least cover the
total production costs at a given level of production.
To price intelligently, management needs to know how its costs vary with different levels of
production.
DIRECT LABOR COST:

Six personnel working on four plants namely:
2 personnel operating Water treatment Plant
2 Personnel operating Mixing Vessel
1 Personnel operating Bottling line
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1 Personnel operating Labeling Machine
Rate of wage = Rs 200/day
Total Labor Expense = 6 x 6000
= Rs. 36,000 /month
DIRECT MATERIAL COST PER LITER:
COMPONENTS Quantity (ml) Rate (Rs) Price per liter (Rs)
Deionized Water(H2O) 680 10/liter 13.6
Sodium Carbonate 75 90/kg 6.75
Sodium Omadine 17.5 500/liter 8.75
Amino Silicon 32.5 260/kg 8.45
Formaldehyde 22 800/liter 18.7
Methyl Jasmonate 30 375/liter 11.25
Methyl Acrylate 20 400/liter 8.00
Dimethyldicholorosilane 95 1500/kg 33
Diphenyloxide Disodium Salt 6 1200/kg 7.2
Fluorescent Brightener 95 225/kg 21.375
TOTAL 1000ml 137.075
TABLE 7 DIRECT MATERIAL COST
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FACTORY OVER HEAD
1. Depreciation
Useful Life in Annual Monthly Amount

Asset Name Cost (Rs)
(Years) Amount (Rs) (Rs)
Water
8000000 35 220000 18333
Treatment Plant
Mixing Vessel 4500000 30 140000 11667
Bottling Line 2500000 15 153333 12777
Labeling Line 700000 10 50000 4167
Depreciation rate
Building 9000000 1080000 90000
(12%)
Total 24700000 1643333 136944
TABLE 8 DEPRECIATION VALUE
2. Label Cost = Rs 0.75/bottle

3. Electricity Bill = 88,000/month
Fixed = 8,000
Variable = 80,000
4. Insurance Payments = Rs 24,000/month
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5. Indirect Labor
4- Supervisor Rs 8,000 x 4 =Rs 32,000/month
2- Security guard Rs 5,000 x 2 = Rs 10,000/month
2- Electrician Rs 4,000 x 2 = Rs 8,000/month
2- Sweeper Rs 3,000 x 2 = Rs 6,000/month
2- Peon Rs 3,000 x 2 = Rs 6,000/month
6. Packing Material = Rs 50000/month
Direct material cost and direct labor cost are 100% variable costs. In factory over head the
amount of depreciation is fixed. In indirect labor cost the 58%, in electricity cost the 9% of
the total is variable cost. Also the label cost, insurance is variable. Packing Material cost is
also variable; it is Rs 50,000/month according to the current production but is viable to
change according to the change in production level.
4. ANALYZING COMPETITORS COSTS, PRICES AND OFFERS:
A firm must take into account the competitors costs, prices, and possible price reactions. If
the firm's offer is inferior, the firm will not be able to charge more than the competitor. If the
firm's offer is superior it can charge more than the competitor. The firm must be aware, how
competitors might change their prices in response.
The fabric softener we are introducing is a new product to market there are no competitors in
the market but after sometime the Soft Touch competitors and other organization may enter
into the market so we have to set the prices in a way that become difficult for the competitors
to compete to us on the price basis. Also the low price will enable us to capture the maximum
market share which once captured can remain loyal to us because we are offering the quality
products at affordable rate.
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5. SELECTING THE PRICING METHOD
Companies set prices by selecting a general pricing approach that includes one or more of
these three sets of factors Costs, Consumer perception and Competitors’ prices. Different
pricing approaches based on the above mentioned factors are as follows:
 Cost-based approach
□ Cost-plus pricing
□ Break-even analysis
□ Target profit pricing
 Buyer-based approach
□ Perceived-value pricing
 Competition based approach
□ Going-rate
□ Sealed-hid pricing
The pricing strategy adopted by Soft Touch in setting the price of “BUBBLES” is the Cost
based approach. To the cost of the product the return rate is applied to get the desired profit
margin.
6. SELECTING THE FINAL PRICE:
Selection of the pricing method narrows down the range from which the company can select
its final price. In this step the effect of other pricing mix element is also determined in order
to set the final price. All the other three “P” contributes significantly to the Pricing “P”. The
product quality its distribution channel, its positioning through promotion are the determining
factors in the selection of the final price.
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The price calculation is as follows:
Price of 500 ml Bottle

Amount (Rs)
72.56
14.51
Total
87.1
Distributor Functional discount (5%)

4.355
Total
91.455
Retailer Standard Discount (1%)

0.91
92.36
Retail Price
14.78
Sales Tax (16%)
107.14
Sales Price
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To the cost price the desired return rate (20%) is added. To the resulting amount the amount
of the discount is added that the firm is paying to the distributor as the functional discount for
the selling and further distribution to the retailers and wholesalers. The discount that the
distributor gives to the retailers and wholesalers is also added to the amount. The standard
discount given to the retailers and wholesalers is 1%.
Besides this, the Trade Offers are also given to push the sales of the firm. Trade offers are
the additional discounts given to the retailers and wholesalers they in return tries their best to
increase the sales of the product. Trade offers varies in on-season and off-season and are
decide every month by the firm management. To the retail price the standard sales tax 16% is
added and the resulting amount is the sale price of the product.
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PLACE (METHOD OF DISTRIBUTION)
“Place is also known as channel, distribution
or intermediary. It is the mechanism through
which goods and/or services are moved from
the manufacturer/ service provider to the user
or consumer”.
Depending on what it is the company is selling will directly influence how to distribute it,
and it affects mainly those businesses that are in production”
MARKETING CHANNEL FUNCTIONS

A distribution channel moves goods from producers to consumers. It fills the main time,
place and possession gaps that separate goods and services from those who would use them.
Members of the marketing channel perform many key functions.
 Information Gathering and distributing marketing research and intelligence
information about actors and forces in the marketing environment needed for planning
and facilitating exchange.
 Promotion. Developing and spreading persuasive communications about an offer.
 Contact. Finding and communicating with prospective buyers.
 Matching. Shaping and fitting the offer to the buyer's needs, including such activities
as manufacturing, grading, assembling and packaging.
 Negotiation. Reaching an agreement on price and other terms of offer, so that
ownership or possession can be transferred.
 Physical distribution. Transporting and storing goods.
 Financing. Acquiring and using funds to cover the costs of the channel work.
 Risk taking. Assuming the risks of carrying of the channel work.
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LEVELS OF MARKETING CHANNEL
Distribution channels can be described by the number of channel levels involved. Each layer
of marketing intermediaries that performs some work in bringing the product and its
ownership closer to the final buyer is a channel level. Because the producer and the final
consumer both perform some work, they are part of every channel. The number of
intermediary levels indicates the length of a channel.
 Direct-marketing channel: A marketing channel that has cut intermediary levels.\

 Indirect Marketing Channel: A channel containing one or more intermediary levels
is called the indirect marketing channel.
FIGURE 12 LEVELS OF MARKETING CHANNELS
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DIRECT OR INDIRECT?
The question to go direct, indirect or both are often determined by the following:
ABILITY TO RECRUIT RESELLERS:

If we cannot get your product into distribution, or find resellers, we go direct.
PRODUCT TYPE:
If firms are selling a product that requires a lot of training, installation and support, they may
go direct until you get resellers trained and certified--or, if they have a large enough sales
force, they may stay direct.
MARKET DYNAMICS:
As the market technology adoption changes and products that used to require support become
easier to use, and customers know what they want-firms may go direct.
PRICE POINT:
High-end premium quality consumer products are sometimes sold direct and usually person-
to-person since the benefits which are real, but not always obvious must be sold. However,
this does not mean that high-priced products can’t be sold via the channel
CUSTOMER REQUIREMENTS:
Some customers require mandate a direct relationship with the vendor to ensure their needs
are met. In some cases, when an account insists on going direct, the reseller can still earn a
bounty for delivering the qualified, pre-sold lead.
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ABILITY TO MANAGE RESELLERS:
Much of the decision to go direct or indirect is also dependent on the companies’ ability to
understand how the channel functions, come up with a competitive program, and manage the
reseller programs and relationships.
The final decision on direct or indirect is based on business model and how the companies
address the questions above.
MARKETING CHANNEL FOR THE FABRIC SOFTENER:

The Soft Touch is using the indirect marketing channel for the “BUBBLES” distribution.
Using an indirect system means get a lower price or pay a higher one and give up control, but
you also transfer responsibility and risk to intermediaries.
The firm will deal with the distributors that further deliver the products to the retailers and
wholesalers. This decision save the cost of the companies going city to city dealing with the
retailers and wholesalers. Distributors have the complete setup in the areas they are operating
they specialize in that particular area. This enables them to perform their duties more
efficiently and effectively.
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PROMOTION:
“Designing and managing the marketing mix element
to inform persuade and remind current and potential
customers, is called promotion”.
Today marketing calls for more than just developing a good product, pricing it attractively,
and making it available to target customers. Companies must also communicate with their
customers, and what they communicate should not be left to chance. To communicate well,
companies often hire advertising agencies to develop effective ads, sales promotion
specialists to design sales-incentive programmes, direct-marketing specialists to develop
databases and interact with customers and prospects by mail and telephone, and public
relations firms to develop corporate images. They train their salespeople to be friendly,
helpful and persuasive. The company communicates with its intermediaries, consumers and
various publics. Its intermediaries communicate with their consumers and publics.
Consumers have word-of-mouth communication with each other and with other publics.
Meanwhile, each group provides feedback to every other group.
PROMOTION MIX
“The specific mix of advertising, personal selling,
sales promotion and public relations that a company
uses to pursue its advertising and marketing objectives.
ADVERTISING:
Any paid form of non-personal presentation and promotion of ideas, goods or services by an
identified sponsor.
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PERSONAL SELLING:
Oral presentation in a conversation with one or more prospective purchasers for the purpose
of making sales and building customer relationships.
SALES PROMOTION:
Short-term incentives to encourage the purchase or sale of a product or service.
PUBLIC RELATIONS AND PUBLICITY:

Building good relations with the company's various publics by obtaining favorable publicity,
building up a good 'corporate image, and handling or heading off unfavorable rumors, stories
and events.
STEPS IN DEVELOPING EFFECTIVE COMMUNICATION

Deciding the right promotional is not enough if the promotional is not used properly and
effectively. For the effective communication the marketing communicator must do the
following:
 Identify the target audience
 Determine the communication objectives
 Design message
 Selecting communication channel
 Establish the total communication budget
 Decide the communication mix
 Measure the communication results
 Manage the integrated communication process
1. IDENTIFYING THE TARGET AUDIENCE

A marketing communicator starts with a clear target audience in mind. The audience may be
potential buyers or current users, those who make the buying decision or those who influence
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it. The audience may be individuals, groups, special publics or die general public. The target
audience will heavily affect the communicator's decisions on 'what will be said, how it will be
said, when it will be said, where it will be said and who will say it.
2. DETERMINING THE COMMUNICATION OBJECTIVES

Once the target audience has been defined, the marketing communicator must decide what
response is sought. The final response should be Purchase, but purchase is the result of a long
process of consumer decision-making. The marketing communicator needs to know where
the target audience now stands and to what state it needs to be moved. To do this he or she
must determine whether or not the customer is ready to buy. The target audience may be in
any of six buyer-readiness stages - the stages that consumers normally pass through on their
way to making a purchase. These stages are awareness, knowledge, liking, preference,
conviction and purchase. The purpose of marketing communication is to move the customer
along these stages and ultimately to achieve final purchase.
The communication objective of Soft Touch is to inform the target market about its new
product, providing awareness about the fabric softener.
3. DESIGNING A MESSAGE
Having defined the desired audience response, the communicator turns to developing an
effective message. Ideally, the message should get Attention, hold interest, arouse Desire and
obtain Action (a framework known as the AID A model). The marketing communicator must
decide
 What to say (message content)
 How to say it (message structure and format).
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MESSAGE CONTENT
The communicator has to figure out an appeal or theme that will produce the desired
response. There are three types of appeal: rational, emotional and moral.
Rational appeals relate to the audience's self-interest. They emphasize the functional benefits,
better performance, higher quality, outstanding economy or value of the product.
Emotional appeals attempt to stir up either negative or positive emotions that can motivate
purchase. These include fear, guilt and shame appeals that get people to do things they should
or to stop doing things they shouldn't.
Moral appeals are directed to the audience's sense of what is 'right' and’ proper'. They are
often used to urge people to support social causes such as cleaner environment, butter race
relations, equal rights for women and aid to the disadvantaged.
The message content will use the emotional selling preposition because the fabric softener
benefits are two dimensional, functional and emotional. Both works together to create overall
consumer perception and the product appeal. The major functional benefits provide by the
fabric softener are softness, perfume, antistatic properties and ease of ironing. The major
emotional benefits are tenderness, pleasure, well being, and sense of care for the family.
MESSAGE STRUCTURE
The communicator must decide how to say it. This requires the communicator to
Handle three message-structural issues.
The first is whether to draw a conclusion or to leave it to the audience.
The second message structure issue is whether to present a one-sided argument or a two-sided
argument.
The third message-structure issue is whether to present the strongest arguments first or last.
The message structure is as such: we will present the strong argument in the last, drawing a
conclusion.
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MESSAGE FORMAT
The communicator also needs a strong format for the message.
□ In the print ad, to attract attention, advertisers can use: novelty and contrast, eye-
catching pictures and headlines, distinctive formats, message size and position, color,
Shape and movement.
□ If the message is to be carried over the radio, the communicator has to choose words,
sounds and voices.
□ If the message is to he transmitted on television or conveyed in person, then all these
elements plus body language have to he planned.
SELECTING THE MESSAGE SOURCE
The message's impact on the target audience is also affected by how the audience views the
communicator. The credibility and attractiveness of the message source - the company, the
brand name, the spokesperson for the brand or the actor in the ad who endorses the product -
must therefore be considered.
4. SELECTING THE COMMUNICATION CHANNEL:

The communicator must now select channels of communication. There are two broad types of
communication channel:
PERSONAL COMMUNICATION CHANNELS

In personal communication channels, two or more people communicate directly with each
other. They might communicate face to face, over the telephone, through the mail or even
through an internet 'chat'. Personal communication channels are effective because they allow
for personal addressing and feedback.
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NON-PERSONAL COMMUNICATION CHANNELS
Non-personal communication channels are media that carry messages without personal
contact or feedback. They include major media, atmospheres and events. Important media
consist of print media (newspapers, magazines, direct mail); broadcast media (radio,
television); and display media (billboards, signs, posters). Atmospheres are designed
environments that create or reinforce the buyer’s leanings towards buying a product. Events
are occurrences staged to communicate messages to target audiences Non-personal
communication affects buyers directly. In addition, using mass media often affects buyers
indirectly by causing more personal communication.
The communication channel Soft Touch will use for the marketing is the non personal
communication channel. It allows the company to communicate to enormous number of
people. In the non personal channel, the sub channels we will be using are the print media,
broadcast media and the display media.
5. SETTING THE TOTAL PROMOTION BUDGET

One of the hardest marketing decisions facing a company is how much to spend on
promotion. There are four common methods used to set the total budget for advertising:
The Affordable Method: Setting the promotion budget at the level management thinks the
company can afford.
Unfortunately, this method of setting budgets completely ignores the effect of promotion on
sales. It leads to an uncertain annual promotion budget, which makes long-range market
planning difficult.
Percentage-Of -Sales Method: In the percentage-of-sales method, marketers set their

promotion budget at ascertain percentage of current or forecast sales. It is simple to use and
helps managers think about the relationship between promotion spending, selling price and
profit per unit. The method supposedly creates competitive stability because competing firms
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tend to spend about the same percentage of their sales on promotion. Despite these claimed
advantages, however, there is little to justify the method. It wrongly views sales as the cause
of promotion rather than as the result.
Competitive-Parity Method: Companies use the competitive-parity- method, setting their

promotion budgets to match competitors' outlays. They watch competitors' advertising or get
industry promotion-spending estimates from publications or trade associations, and then set
their budgets based on the industry average.
Objective-and-Task Method: The most logical budget-setting method is the objective-and-

task method, whereby the company sets its promotion budget based on what it wants to
accomplish with promotion. The method entails:
(1) Defining specific objectives;
(2) Determining the tasks needed to achieve these objectives
(3) Estimating the costs of performing these tasks. The sum of these costs is the proposed
promotion budget. Managers using this method have to set sales and profit targets and then
work back to what tasks must be performed to achieve desired goals. The main advantage of
this method is that it forces managers to define their communication objectives, to determine
extent to which each objective will be met using selected promotion tools and the financial
implications of alternative communication programme.
The budget setting technique used by the Soft Touch is the objective and task method.
6. SETTING THE PROMOTION MIX

The company must divide the total promotion budget among the main promotion tools. It
must blend the promotion tools carefully into a coordinated promotion mix. Designing the
promotion mix is even more complex when one tool must be used to promote another.
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ADVANTAGES AND DISADVANTAGES OF EACH ELEMENT OF THE
PROMOTIONAL MIX:
ADVANTAGES DISADVANTAGES
MIX ELEMENT
Good for building awareness
Impersonal - cannot answer
Effective at reaching a wide
customer's questions
audience
ADVERTISING
Not good at getting
Repetition of main brand and
customers to make a final
product positioning helps build
purchasing decision
customer trust
Highly interactive - lots of

communication between the Costly - employing a sales
buyer and seller force has many hidden costs
PERSONAL SELLING in addition to wages
Excellent for communicating
complex / detailed product Not suitable if there are
information and features thousands of important
buyers
Can stimulate quick increases in If used over the long-term,

sales by targeting promotional customers may get used to
SALES PROMOTION
incentives on particular the effect
products
Too much promotion may
Good short term tactical tool damage the brand image
more "credible"
Risk of losing control -
PUBLIC RELATIONS Cheap way of reaching many cannot always control what
customers - if the publicity is other people write or say
achieved through the right about your product
media
123

FACTORS IN SETTING THE PROMOTION MIX
Companies have to consider many factors when developing their promotion mix
TYPE OF PRODUCT/MARKET
The importance of different promotional tools varies between consumer and business
markets. Consumer goods companies usually put more of their funds into advertising,
followed by sales promotion, personal selling and then public relations. Advertising is
relatively more important in consumer markets because there are a larger number of buyers,
purchases tend to be routine, and emotions play a more important role in the purchase-
decision process. In contrast, industrial-goods companies put most of their funds into
personal selling, followed by sales promotion, advertising and public relations, general,
personal selling is used more heavily with expensive and risky goods and in markets with
fewer and larger sellers. The fabric softener Soft Touch is launching is a new consumer
market product the promotion a mix will be used in the following particular order.
□ Advertising
□ Sales Promotion
□ Personal Selling
□ Public Reactions
PUSH VERSUS PULL STRATEGY:

The promotional mix is influenced by whether the company chooses a push or pulls strategy.
A push strategy involves 'pushing' the product through distribution channels to final
consumers. The firm directs its marketing activities (primarily personal selling and trade
promotion) towards channel members to induce them to carry the product and to promote it
to final consumers.
In a pull strategy, the producer directs its marketing activities (primarily advertising and
consumer promotion) towards final consumers to induce them to buy the product. If the pull
124

strategy is effective; consumers will then demand the product from channel members, which
will in turn demand it from producers. Thus under a pull strategy, consumer demand 'pulls'
the product through the channels.
Both strategies are needed for successful marketing, because each strategy attracts a different
type of consumer.
□ For the new product an initial push strategy is useful because product is as yet
unfamiliar to target market. Push-marketing makes brand pervasive. Push-marketing
involves the active engagement of a target market through. In push-marketing, we will
largely focus on the features of product and seek a direct response from the targeted
audience.
□ Pull-marketing largely involves the active development of a highly visible brand. This
will encourages customers to actively seek out, because they believe our product can
fulfill their needs.
BUYER-READINESS STAGE:
The effects of the promotional tools vary for the different buyer-readiness stages.
Advertising, along with public relations, plays the leading role in the awareness and
knowledge stages, more important than that played by 'cold calls' from salespeople. Customer
liking, preference more affected by personal selling, which is closely followed by advertising.
Finally, closing the sale is mostly done with sales calls and sales promotion. Clearly,
advertising and public relations are the most cost effective at the early stages of the buyer
decision process, while personal selling, given its high costs, should focus on the later stages
of the customer buying process.
As Soft Touch is introducing new product to the market, we have to make enormous effort to
affect the prospects minds. First we have to inform them about our product and then persuade
them it is the product they are looking for. Advertisement in this regard is great help because
125

we can perform simultaneously the two tasks of informing and persuading to a relatively
large target market.
PRODUCT LIFE-CYCLE STAGE:

The effects of different promotion tools also vary with stages of the product life cycle. In the
introduction stage, advertising and public relations are good for producing high awareness,
and sales promotion’s useful in getting early trial. In the initial stage of product aim is to
inform market about our product presence. As we are in the introduction stage the most
affective tool would be advertising.
7. COLLECTING FEEDBACK
After sending the message, the communicator must research its effect on the target audience.
This involves asking the target audience members whether they remember the message, how
many times they saw it, what points they recall, how they felt about the message, and their
past and present attitudes towards the product and company. The communicator would also
like to measure behavior resulting in the message - how many people bought a product,
talked to others about it or visited the store.
8. MANAGING INTEGRATED MARKETING COMMUNICATION

Integrated marketing communication is the concept under which a company carefully
integrates and co-ordinates its many communications channels mass-media advertising,
personal selling, sales promotion, public relations, direct marketing, packaging and others to
deliver a clear, consistent, and compelling message about the organization and its products. It
builds a strong brand identity in the marketplace by tying together and reinforcing all the
company's positioning, images and messages across all its marketing communications
venues.
126

It is by this painstaking method of careful examination and eventual rejection that we
reach a conclusion: life is something to do when you can't get to sleep. The report
summarizes the systematic process of introducing and marketing a new product introduced by
Soft Touch Company. This process defines how a new product is actually worked upon and
what efforts are behind the whole story.
Introduction and launching the new product covers the following nine steps nine steps, idea
generation, idea screening, and concept development, Concept testing, marketing analysis,
business analysis, product development, test marketing and commercialization.
Only introducing a product is not the true success of the company but to make the best
product image and position the product in the minds of the customers is the ultimate goal of
the company, which must be carefully managed by considering the different aspect of the
market to be severed.
Estimation of customers demand, purchasing power and the overall market condition forms
the basis of price to be offered to attract new customer and that also contribute in increasing
the profit earning capacity of the company. Much efforts and time should be delivered to
analyze the marketing mix elements i-e product, price, place, & promotion. Because without
considering these elements a product cannot gain an attractive market share and may even
result in the full wastage and destruction of all efforts made in launching a new product.
127

AWARENESS: A measure of the percent of target customers who are aware
of the new product's existence. Awareness is variously
defined, including recall of brand, recognition of brand,
recall of key features or positioning.
BRAND: A name, term, design, symbol, or any other feature that

identifies one seller's good or service as distinct from those
of other sellers. The legal term for brand is trademark. A
brand may identify one item, a family of items, or all items
of that seller.
BUSINESS An analysis of the business situation surrounding a

ANALYSIS: proposed project. Usually includes financial forecasts in
terms of discounted cash flows, net present values or
internal rates of returns.
BUYER: The purchaser of a product, whether or not they will be the

ultimate user. Especially in business-to-business markets, a
purchasing agent may contract for the actual purchase of a
good or service, yet never benefit from the function(s)
purchased.
CONCEPT: A clear written and possibly visual description of the new

product idea which includes its primary features and
consumer benefits.
128

CONCEPT The act by which new concepts, or product ideas, are
GENERATION: generated. Sometimes also called idea generation or
ideation.
CONCEPT The process by which a concept statement is presented to

TESTING: consumers for their reactions. These reactions can either be
used to permit the developer to estimate the sales value of
the concept or to make changes to the concept to enhance
its potential sales value.
CONSUMER: The most generic and all-encompassing term for a firm's

targets. The term is used in either the business-to-business
or household context and may refer to the firm's current
customers, competitors' customers, or current non-
purchasers with similar needs or demographic
characteristics. The term does not differentiate between
whether the person is a buyer or a user target. Only a
fraction of consumers will become customers.
CONSUMER The purchasing of goods and services by individuals and

MARKET: for household use (rather than for use in business settings).
Consumer purchases are generally made by individual
decision-makers either for themselves or others in the
family.
CUSTOMER: One who purchases or uses your firm's products or services
COMPETITIVE Offering a different benefit then that of your competitors.

ADVANTAGE:
COMPETITOR Process of understanding and analyzing a competitor’s

ANALYSIS: strengths and weaknesses, with the aim that an organization
will find a competitive positioning difference within the
market.
129

COMPETITION Setting a price in comparison with competitors.
PRICING:
DEMOGRAPHIC Dividing the population into age, gender, income and socio-

SEGMENTATION: economic groups amongst other variables..
DISTRIBUTION: The method and partners used to get the product (or
service) from where it is produced to where the end user
can buy it.
DIRECT The process of sending promotion material to a named

MARKETING: person within an organization.
INITIAL The first decision to spend resources (time or money) on a

SCREENING: project. The project is born at this point. Sometimes called
"idea screening."
LAUNCH: The process by which a new product is introduced into the

market for initial sale.
MARKET The characteristics of the market into which a new product

CONDITIONS: will be placed, including the number of competing
products, level of competitiveness, and growth rate.
MARKET Taking current products to new consumers or users. This

DEVELOPMENT: effort may involve making some product modifications.
MARKET The act of dividing an overall market into groups of

SEGMENTATION: consumers with similar needs, where each of the groups
differs from others in the market in some way.
130

MARKET SHARE: A company's sales in a product area as a percent of the total
market sales in that area.
MARKET TESTING: The product development stage when the new product and
its marketing plan are tested together. A market test
simulates the eventual marketing mix and takes many
different forms, only one of which bears the name tests
market.
MASS The promotion of a product or service to all consumers.

MARKETING:
MARKETING MIX: The strategy of the organization consisting of products,

price, place and promotion strategy (also known as the
4p's).
NEW PRODUCT A preliminary plan or purpose of action for formulating

IDEA: new products or services.
NICHE The process of concentrating your resources and efforts on

MARKETING: one particular segment
PRODUCT: Term used to describe all goods and services sold. Products
are bundles of attributes (features, functions, benefits and
uses) and can be either tangible as in the case of physical
goods, or intangibles such as those associated with service
benefits or a combination of the two.
131

PRODUCT The overall process of strategy, organization, concept
DEVELOPMENT: generation, product and marketing plan creation and
evaluation, and commercialization of a new product.
PRODUCT A disciplined and defined set of tasks and steps which

DEVELOPMENT describe the normal means by which a company repetitively
PROCESS: converts embryonic ideas into salable products or services.
PRODUCT LINE: A group of products marketed by an organization to one

general market. The products have some characteristics,
customers and uses in common and may also share
technologies, distribution channels, prices, services and
other elements of the marketing mix.
PSYCHOGRAPHICS Characteristics of consumers which, rather than purely

demographic, measure their attitudes, interests, opinions,
and lifestyles.
PENETRATION A pricing strategy where the organization sets a low price

PRICING: to increase sales and market share.
PERSONAL Selling a product or services one to one.

SELLING:
SALES An incentive to encourage the sale of a product/service e.g.

PROMOTION: money off coupons, buy one, get one free.
SEGMENTATION: The process of dividing a market into groups that display

similar behavior and characteristics.
132

TARGET MARKET: The group of consumers or potential customers selected for
marketing. A market segment of consumers.
TEST MARKETS: The launching of a new product into one or more limited
geographic regions in a very controlled manner and
measuring consumer response to the product and its launch.
When multiple geographies are used in the test, different
advertising or pricing policies may be tested and the results
compared.
USER: Any person who uses a product or service to solve a

problem or obtain a benefit, whether or not they purchase it.
Accounting and finance department 26 Average cost 103
Additions to existing product lines 31 Behavioral segmentation 44
Advertising 116 Business analysis 59
133

Business market 42 Diffused preferences 47
Direct-marketing channel 112

Business products 91
Emergency product 92
Buyer-readiness stage125
Emulsifiers 75
Clustered preferences 48
First entry 84
Commercialization84
Fixed costs 103

Competitive advantage 55
Fluorescent brightener 77
Competitive-parity method 122
Concept development 36
Test marketing 81
Concept testing 37
Conditioning agents 73 Full market coverage 53
Consumer market 42 Geographic segmentation 43
Homogeneous preferences 47
Consumer products 90
Human resource department 20
Controlled test markets 82 Idea generation 33
Convenience products 92 Idea screening 35
Cost reductions 31 Image differentiation 56
Customer analysis 38 Improvements and revisions of existing

products 31
Demand estimation 59
Impulse products 93
Demographic segmentation 43
Indirect marketing channel 112
Differentiated marketing 53
Individual marketing 47
134

Integrated marketing communication 126 New product committee 35
Late entry 84 New product lines 31
Levels of marketing channel 112 New product 30
Local marketing 46 New-to-the-world products 31
Main solvent 73 Information 111
Niche marketing 46
Market analysis 38
Nominal partner 12
Market- penetration pricing 100

Non-personal communication channels
Market specialization 52
121
Marketing department 27
Objective-and-task method 122
Marketing mix 88 Parallel entry 84
Market-skimming pricing 100 Partners in profit only 13
Mass marketing 45 Percentage-of -sales method 121
Matching 111 Perfuming agent 76
Message content 119 Personal communication channels 120
Message format 120 Personal selling 117
Message structure 119 Personnel differentiation 56
Minor partner 13 Ph stabilizer 76
Negotiation 111 Place 11
135

Positioning 54 Salaried partner 13
Preservative75 Active partner 12
Price 99 Production department 16
Product development 70 Sales department 19
Product differentiation 55 Sales promotion 117
Product specialization 52 Secret partner 13
Promotion mix 116 Segment attractiveness48
Segment marketing 45
Promotion 111
Segmentation 41
Promotion 116
Selective specialization 52
Psychographic segmentation 44
Shopping products 92
Public relations and publicity 117
Simulated test markets 83
Pull strategy124
Single segment concentration52
Push strategy 124
Specialty products 92
Quality control department 16 Standard test markets 82
Repositioning 31 Surfactants 74
Research and development department 24 Target market 51
Human resource planning 21
Human resource forecasts 21 The affordable method 121
Recruitment and selection 23 Total costs 103
136

Undifferentiated marketing 53
Unsought products 93
Variable costs 103
Wrinkle remover 76
Written agreement 8
Registration of firms 11
Sleeping partner 12
137

Form No. III
[Rule 4(iv)]
Intimation of change in the place of business

(Other than Principal Place of Business)
Presented or forwarded to the Registrar of Firms for filing by

Under Section 61 of the Indian Partnership Act, 1932 intimation is hereby given that the
changes specified below have occurred in the place of business of the firm *
Date of Change:
1. The Firm has discontinued business at______________________________________
2.______________________________________________________________________
The Firm has begun to carry on business at___________________________ Station

Date
Verified
Signature of any partner
Or agent of the Firm
------------------------------------------------------------------------------------------- -* Here enter name

of Firm.
NB: Strike out items not required

This form must be signed by any of the partners or his agent specially
authorized in this behalf in the presence of a witness who must be Gazette Offi cer,
Advocate, Attorney, Vakil, Magistrate or Registered Accountant.

Form No. VI
[Section 63(i) & Rule 4(vi)]
Notice of Dissolution of a Registered Firm

THE INDIAN PARTNERSHIP ACT, 1932.
To
The Registrar of Firms,
I,_______________________________________________________, a partner of
The firm____________________________________________* (kor an authorized agent)
Of______________________________________________________ a partner of the firm
* Hereby give notice of dissolution of the said firm which took effect from the_______day of
Of 20 .
Certified copy of a deed dissolving the firm, if any and certified translation of
the deed, if not in English Language must accompany the notice
Signature *

Kotler Philip, Gary Armstrong, John Saunders, Veronica Wong. Principles of Marketing.12th
Edition. Prentice Hall Europe. 2007
Kotler Philip. Marketing Management.12th Edition. Prentice Hall Europe. 2005.
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IMPLEMENATION OF MARKETING ON

NEW PRODUCT DEVELOPMET

SUBMITTED TO: MAM RIZWANA AKBER

SUBMITTED BY: Shakeel Ahmad (MB09021) (GL)

Zeeshan munawer (MB09060)

Waqas sarfraz ( MB09037)

Muhammad asif (MB09059)

Muahmmad ameen (MB09009)

Hafiz ishtiaq (MB09147)

We wish to express our special thanks to our worthy teachers MAM

Holly Prophet peace be upon him

Our Honorable Teachers & Loving Parents

Love, Affection, Motivation, Patience, Support,

Spiritual Inspirational, Give us Encouragement,

To all those People who have quenched for Knowledge,

To all those who have dedicated their lives to others,

To all of those who have served and sacrificed for

To all of those people, who may be gone now,

But they will never be

Executive Summary iii

Departments of Soft Touch 16

Quality Control Department 17

Human Resource Department 20

Research and Development Department 24

New Product Development 29

Segmentation Variables for Fabric

Patterns of Target Market 51

Positioning strategy for Fabric Softener 58

Development of Fabric Softener 72

Basic Formulation of Product 73

Commercialization Plan for Fabric 85

Products of Soft Touch 94

Product Decisions of Fabric Softener 97

Price of Product 108

Levels of Marketing Channels 112

Marketing Channel for Fabric softener 114

Promotional Mix 116

Steps in Effective Communication 117

1 Direct Material Cost 60

3 Price of 500ml Bottle 68

4 Price of 250ml Bottle 69

5 Basic Formulation of Product 73

6 Quality Control Test 80

7 Direct Material Cost 104

8 Depreciation Values 105

9 Price of 500ml Bottle 108

3 Water Treatment Plant 63

9 Mixing Vessel Working 78

11 Categories of Consumer Products 91

12 Levels of Marketing Channel 112

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

“Liquid composition which makes the fabrics soft

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

“To be known as leader of quality products.

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

By nature our business is a firm i.e. a PARTNERSHIP FIRM.

“Partnership” is the relation between persons,

BASIC REQUIREMENTS OF CONTRACT

 Legally enforceable agreement

FIRM LEGAL ENTITY FOR PURPOSE OF TAXATION:

UNIVERSITY OF THE PUNJAB, GUJRANWALA CAMPUS

PARTNERS ARE MUTUAL AGENTS