Unit I Business Studies.docx

Paper - II ========== **Course Code -- 3CC1 Course Name -- Business Studies** --------- -- -- -- -- -- **CO1** **CO2** **CO3** **CO4** --------- -- -- -- -- -- UNIT - I ======== UNIT - II ========= UNIT - III ========== UN...

Paper - II ========== **Course Code -- 3CC1 Course Name -- Business Studies** --------- -- -- -- -- -- **CO1** **CO2** **CO3** **CO4** --------- -- -- -- -- -- UNIT - I ======== UNIT - II ========= UNIT - III ========== UNIT - IV ========= Reference Books =============== 1. Marketing Management by Namaswamy & Ramakumari. 2. Financial Management -- I M Pandey -- S. Chand & Co. Pvt. Ltd. 3. Aswathappa, K.; Human Resource and Personnel Management (Text and Cases), Tata McGraw Hill Publishing Company 4. Production and Operations Management, K.Aswathappa & K. Shridhara Bhat, Himalaya Publication 1. **Marketing is an economic function**: marketing embraces all the business activities involved in getting goods and services, from the hands of producers into the hands of final consumers. The Business steps through which goods progress on their way to final consumers is the concern of marketing. 2. **Marketing is a Legal process by which Ownership transfers**: In the process of marketing the ownership of goods transfers form seller to the purchaser to the end user. 3. **Marketing is a Managerial function**: According to managerial or system approach- "marketing is the combination of activities designed to produce profit through ascertaining, creating, stimulating, and satisfying the needs and/ or wants of a selected segment of the market. 4. **Marketing is system of Interacting Business Activities**: Marketing is the process through which a business enterprise, institution, or organization interacts with the customers and stakeholders with the objective to earn profit, satisfy customers, and manage relationship. It is the performance of business activities that direct the flow of goods and services from producers to consumer or user. a. Knowing and understanding the consumer's changing needs and wants b. Efficiently and effectively managing the supply and demand of products and services c. Efficient provision of distribution and payment processing systems. 6. Marketing is a philosophy based on consumer orientation and satisfaction. 7. Marketing had dual object ves- profit making and consumer satisfaction. **Scope of Marketing** 1. Study of consumer wants and needs: Goods are produced to satisfy consumer wants. Therefore study is done to identify consumer needs and wants. These needs and wants motivates consumer purchase. 2. Study of consumer behavior: Marketers performs study of consumer behavior. Analysis of buyer behavior helps marketer in market segmentation and targeting. 3. Product on planning and development Product planning and development starts with the generation of product idea and ends with the product development and commercialization. Product planning includes everything from branding and packaging to product line expansion and contraction. 4. Pricing policies: Marketer has to determine pricing policies for their products. Pricing policies differs form product to product. It depends on the level of competition, product life cycle, marketing goals and objectives etc. 5. Distribution: Study of distribution channel is important in marketing. For maximum sales and profit goods are required to be distributed to the maximum consumer at minimum cost. 6. Promotion: Promotion includes personal selling, sales promotion, and advertising. Right promotion mix is crucial in accomplishment of marketing goals. 7. Consumer satisfaction: The product or service offered must satisfy consumer. Consumer satisfaction is the major objective of marketing. 8. Marketing Goal: Marketing audit is done to control the marketing activities. Importance of Marketing in Business 1. Helps in business planning and decision making Marketing helps in business planning as it helps to shape the product from its production to it reaching the customers. The 4Ps of marketing help the business to make sure what alternatives are better for the growth of the business and help to make decisions that prove beneficial for the customers. 2. Product development The product part of the 4Ps provides alternatives for developing the product regarding its branding, labelling, packaging, and how it should be brought into the market. Moreover, customer feedback and market research provide a blueprint of how the product has to be further modified to suit the needs of the consumers. 3. Effect ve consumer engagement with the use of various platforms online and offline, the company can gain consumer engagement in some form or another. In personal selling, for example, salesmen interact with the customers and get to know their needs. 4. Builds relationships among customers: marketing always tries to establish a cordial relationship with the customers. Modern marketing deals with the customers as they are the king. Hence continuous efforts make customers satisfied. And this helps them stay with the brand or company for a long time. 5. Marketing creates revenue options: When marketing techniques convert the leads to actual sales. It ultimately increases revenue. Hence, marketing is crucial to generating and increasing revenue by communicating the products with potential customers. 6. Set better goals for your business: Marketing helps the business know about the customers\' demands and needs. They could set their goals according to these. 7. Build a reputation on for your brand effective marketing tends to impact the customers\' minds. Hence, they build brand awareness among them. **Marketing management ** Marketing management facilitates the activities and functions which are involved in the distribution of goods and services. The main focus of all the firms turned from hard selling towards Identification of customer needs, deciding to fulfil those need and maintaining long-term relationships with customers by satisfying their changing needs. The Marketing concept resulted in a separate marketing department in the organization, and today we can see much organization have structured them as marketing organization where every employee is contributing towards customer satisfaction whether or not he's a marketing person.   According to Philip Kotler "Marketing management is the analysis, planning, implementation and control of programs designed to bring about desired exchanges with target markets to achieve organizational objectives. It relies mainly on designing the organizations offering regarding the target markets needs and desires and using effective pricing, communication and distribution to inform, motivate and service the market." Marketing management is concerned with the chalking out of a specific program, after careful analysis and forecasting of the market situations and the ultimate execution of these plans to achieve the objectives of the organization. Further, their sales plan to a greater extent rest upon the requirements and motives of the consumers in the market. To achieve this objective, the organization has to pay heed to the right pricing, effective advertising and sales promotion, distribution and stimulating the consumers through the best services.   - Needs -- it is something inevitable for the existence of life; many adverse things can occur without it. The worst-case situation would be death. Needs cover many things, like food, shelter, self-development, security, social belonging, self-esteem, and respect. - Wants -- wants are our desires and wishes in life; our social setup and culture mold our wants. - Demands -- when our desires, needs, and wants are backed by our ability to pay, they become demands. 1. Product on Concept 2. Product Concept 3. Selling Concept 4. Marketing Concept 5. Societal Marketing Concept 1. Product or Commodity Approach 2. Institutional Approach 3. Functional Approach 4. System Approach 5. Decision making approach 6. Social approach 7. Holistic approach 1. Product or Commodity Approach: 2. Institutional Approach: 3. Functional Approach: 4. System Approach: 5. Societal Approach: 1. Demographic environment Demography is the study of populations. The demographic environment for a company encompasses the people who are part of a specific market. This environment includes the size and density of a particular population and the common occupations people have. It also covers the age, race and gender of prospective customers in a demographic group. 2. Economic environment A company\'s economic environment refers to the factors that influence consumer buying habits and the company\'s performance. A company\'s economic environment may fluctuate based on government funding, credit availability, market trends, interest rates and shifts in the global economy. For example, an economic recession could negatively affect a business\'s profits, but an economic surplus might encourage customers to make larger purchases. 3. Natural environment A natural environment, or physical environment, refers to both the location a business operates and the place it sources any natural resources it needs. For example, a lumber shortage is a natural marketing environment that may affect a construction business. Here are a few common factors that impact the natural environment of a business: - A shortage or surplus of raw goods - A fluctuation in the cost of energy - A change in the quality of air - Natural disasters - Climate change - A change in government policies 4. Technolog cal environment A technological environment includes a specific market, technological equipment and innovative practices and products. Technology like laptops, automated machines and social media can all improve an organization\'s productivity and reach. In this type of marketing environment, it\'s important for companies to understand customer behavior. 5. Political environment Changes in a country\'s national or local political situation can modify a company\'s external marketing environment. Politics might determine tariffs, regulations and other standards that affect the cost of purchasing goods and conducting business operations. Political environments may sometimes influence the global economy, which can alter the behavior of a market. 6. Social environment A social environment refers to the way companies and consumers respond to social experiences. For example, an organization might donate a portion of its earnings to nonprofits or government agencies that help communities in need. 7. Cultural environment Similar to social environments, a cultural environment refers to the way local communities interact with each other and your brand. Depending on the region, this type of marketing environment can vary widely. Some factors that influence a cultural environment include people\'s opinions about their community, other social groups and the company. 1. Suppliers: Suppliers provide raw materials, services or goods to a company. The prices, service availability and product quality that a supplier offers can affect the cost and condition of products that customers purchase. 2. Distributors and resellers: Distributors help companies store and deliver their goods, often using warehouses. They also assist organizations by delivering products safely and on time. They may represent a specific brand, especially if they deliver to different outlets. 3. Partners: Partners are organizations that a company collaborates with to develop a product, deliver a service or provide a promotion. Typically, the members of a partnership include two or more companies that may operate in similar industries. However, a company may sometimes partner with a business from a different industry to expand its customer base. 4. Customers: Customers exercise a major influence on a company\'s marketing environment. Companies may collect information about customer behaviors and opinions to help inform future business decisions. 5. Competitors: A company\'s competitors are part of its microenvironment because they directly affect daily business operations. A company can determine its position in the market to decide on strategies that can help it outperform its competition. Competing businesses often share customers, so it\'s helpful to monitor how the competitors are succeeding to understand ways that the company you work for might improve. 6. The public: The public includes any person who might engage with the company. The public can also include potential investors and people who refer new customers to the business. Understanding the public as a group of potential customers can help you target new markets to increase brand awareness. 1. Analyzing Market Opportunities: Marketing management collects and analyses information related to consumer's needs, wants and demands, competitor's marketing strategies, changing market trends and preferences. This helps to identify market opportunities. 2. Determination of Target Market Marketing management helps to identify the target market that the organization wishes to offer its product. 3. Planning and Decision Making: Marketing management helps to prepare future course of action. Planning relates to product introduction, diversification. Decision making regarding pricing, selection of promotional mix, selection of distribution channel is taken by the marketing management. 4. Creat on of Customer: Consumers determine the future of the market.Therefore providing the best product to the consumer according to their preference is the important task of marketing. Marketing management helps in creation of new customers and retention of current customers. 5. Helps in Increasing Profit Marketing caters to the varied and unlimited needs of consumers. Marketing management helps to increase profit and sales volume. This is achieved by expansion of market and increasing customers. 6. Improvement in Quality of Life: Marketing management aims at providing innovative product and services to the customers. Marketers continuously strive to incorporate new technology and mechanism in their product to provide more satisfaction to customers than before. This improves quality of life and makes life of consumers easier than before. 7. Employment Opportunities: Marketing process is a combination of different activities like research work to assess the marketing environment, product planning and development, promotion, distribution of product to customers and after sales service. Marketing process requires researcher, production engineer, different distribution intermediaries, sales personnel also creates employment opportunities in advertisement section. Thus marketing management opened up different employment avenues thus creating employment opportunities.  **Marketing Mix of Services** A product is an item produced or procured by the business to satisfy the needs of the customer. It is the actual item that is held for sale in the market. A company usually sells different types of products. **For example, **[Patanjali](https://www.feedough.com/patanjali-brand-study/) deals in different categories of products which include shampoo, flour, toothpaste, etc. Shampoo, here, forms a different product line, flour forms a different product line as well, and so does toothpaste. However, when they all are grouped together, they form the product mix of Patanjali. These different product brands are also known as [product lines](https://www.feedough.com/what-is-product-line/). A combination of all these product lines makes up the product mix. What Is Product Mix? -------------------- Product mix, also known as product assortment, refers to the total number of product lines that a company offers to its customers. The product lines may range from one to many and the company may have many products under the same product line as well. All of these product lines when grouped together form the product mix of the company. The four Ps classification for developing an effective marketing strategy was first introduced in 1960 by marketing professor and author E. Jerome McCarthy.1 It was published in the book entitled *Basic Marketing: A Managerial Approach. *Depending on the industry and the target of the marketing plan, marketing managers may take various approaches to each of the four Ps. Each element can be examined independently, but in practice, they often are dependent on one another.  Product mix depends on many factors like: - *Company Age* - *Financial Standing* - *Area of Operation* - *Brand identity, etc.* ### Traditional Mix are 04 only i.e. - Product - Price - Place - Promotion Expanded or modern 03 mix are 1. People 2. Physical Evidence 3. Process ### Product In the case of services, the \"product\" is intangible, heterogeneous and perishable. Moreover, its production and consumption are inseparable. Hence, there is scope for customizing the offering as per customer requirements, and the actual customer encounter therefore assumes particular significance. However, too much customization would compromise the standard delivery of the service and adversely affect its quality. Therefore, particular care has to be taken in designing the service offering. ### Pricing Pricing of services is tougher than pricing of goods. While the latter can be priced easily by taking into account the raw material costs, in the case of services there are attendant costs\--such as labor and overhead costs\--that also need to be factored in. A restaurant not only has to charge for the cost of the food served but also has to calculate a price for the ambiance provided. ### Place Since service delivery is concurrent with its production and cannot be stored or transported, the location of the service product assumes importance. Service providers have to give special thought as to where the service is provided. A fine dining restaurant is better located in a busy, upscale market as opposed to the outskirts of a city. A holiday resort is better situated in the countryside away from the rush and noise of a city. ### Promotion Since a service offering can be easily replicated, promotion becomes crucial in differentiating a service offering in the mind of the consumer. Service providers offering identical services such as airlines or banks and insurance companies invest heavily in advertising their services. This is crucial in attracting customers in a segment where the services providers have nearly identical offerings. ### People People are a defining factor in a service delivery process, since a service is inseparable from the person providing it. A restaurant is known as much for its food as for the service provided by its staff. The same is true of banks and department stores. Consequently, customer service training for staff has become a top priority for many organizations today. ### Process The process of service delivery is crucial since it ensures that the same standard of service is repeatedly delivered to the customers. Most companies have a service blue print which provides the details of the service delivery process, often going down to even defining the service script and the greeting phrases to be used by the service staff. ### Physical Evidence Since services are intangible in nature, most service providers strive to incorporate certain tangible elements into their offering to enhance customer experience. Many hair salons have well designed waiting areas, often with magazines and plush sofas for patrons to read and relax while they await their turn. Similarly, restaurants invest heavily in their interior design and decorations to offer a tangible and unique experience to their guests. ### What Is STP in Marketing? Effective marketing involves getting the right message to the right people. That's why STP marketing is a tool marketers often use to ensure their messaging is directed at the right audience and communicated in a way that entices them to heed a call to action.  So what does STP stand for in marketing? STP in marketing stands for segmentation, targeting, and positioning. These three basic steps dictate how marketers can identify the right customers, serve them the right messaging, and give them the information they need for successful [targeting](https://www.wrike.com/marketing-guide/faq/what-is-targeting-in-marketing/).  1. **Segmentation**: First, marketers use [marketing analytics](https://www.wrike.com/marketing-guide/marketing-analytics/) to create specific segments of a target audience based on predetermined criteria. [The marketing department](https://www.wrike.com/marketing-guide/marketing-team-department/) could choose to segment the audience based on demographics, geography, purchasing frequency, or even by lifestyle characteristics like hobbies.  2. **Targeting**: Once you have divided your audience into different segments, you'll assess those segments. This is necessary in order to determine which segment would be the most profitable to target based on the size of the segment, how willing this segment would be to purchase your product, and how well you'll be able to reach this segment of the audience with marketing channels available to you.  3. **Positioning**: Finally, positioning involves creating bespoke messaging designed for the segment you've chosen to target. This messaging should set your product or service apart from your competitors and push your targeted segment to purchase. Once you've determined the target segment, you can create just the right mixture of marketing activities to turn them into customers.  ### Benefits of STP marketing STP in marketing should make tailoring your [marketing communications](https://www.wrike.com/marketing-guide/faq/marketing-communications-definition/) simpler and more effective. Rather than creating generic messaging designed to appeal to large swathes of people, you're creating personalized messaging that should hopefully appeal to the niche you've chosen to focus on. This should result in higher engagement with the target audience and more sales converted in the marketing campaign.  As is the case with many marketing processes, STP in marketing relies heavily on robust marketing analytics that gives marketers the ability to create those segments and analyze them accurately. Marketers will need [marketing analytics software](https://www.wrike.com/marketing-guide/marketing-tools-software/) that can drill down into specific demographic and behavioral details. This will help them create the most effective marketing campaigns.