Money & Functions of money

 Money is the set of assets in the economy that people regularly use to buy goods and services from other people. The cash in your wallet is money because you can use it to buy a meal at a restaurant or a shirt at a clothing store.

 To an economist, money does not refer to all wealth but only to one type of it: money is the stock of assets that can be readily used to make transactions. Roughly speaking, the dollars in the hands of the public make up the nation’s stock of money.

 Functions of money

Money plays different types of significant roles in modern production system and social lives.

While describing the functions of money, the poet says,

'the thing that measures exchange and value

Paying the loans and savings,

Everyone knows that, Money it is'

 

The following two lines of an English poem refers to the functions of money-

"Money is a matter of functions four; A medium, a measure, a standard, a store." This means that, money has four functions. Those are: medium of exchange, measure of price, means of savings and standard of delayed or postponed transaction.

 Below is a description of the four major functions of money:

 Medium of exchange:

Transaction is done through exchange of money as money is acceptable to everyone. A salesman takes money in exchange of things and a customer buys thing by paying money. In this way, by exchanging money anytime any product or service can be purchased. For that reason transaction becomes easy and fast. So, it can be said that money is the easiest and the most convenient medium of exchange.

 Measure of price:

The way meter measures length and kilogram measures weight, money is also used as the scale to measure the price of product and services. For example, Amir buys a book with 50 taka. Here, 50 taka is the assessor of price of that book. Through money, we can easily measure the price of product and services and we can also make comparisons between the former and upcoming price of product and services.

 Means of savings:

Savings cannot be built through products as most of the products are perishable. On the other hand, service is a living item for consumption so industry and services cannot be stored. But the price of these kinds of products and services can be stored by money as everything can be exchanged through money. Nowadays people can save their surplus after subtracting the consumption cost from the production wages because saving through money is more secure and comparatively stable.

 Standard of delayed or postponed transaction:

Delayed transaction refers to future dealings. The calculation of these dealings is done through money. Moreover, taking and returning loan by money is more appropriate. As a result, economic activities can be done without any hindrance. At present, most of the business transaction cheques, bank drafts, exchange bills etc. are finalized through debentures. The bank circulates these debentures on the basis of the cash saved as fixed deposit. Thus, money is considered to be the basis of loan and the standard of delayed transaction. Apart from the above mentioned tasks, money also works as price transmission medium, standard of liquidity and symbol of social status. These roles of money are not different; rather one has been arisen from another. Hence, it is said that the economic development of the society has become easily accessible because of the functions of money.

Methods of Calculating GDP

 The general definition of GDP is rather simple – however, economists seldom like simplicity, and therefore there are three different ways to calculate GDP.

1. Production Method

The production approach to GDP is the market value of all final goods and services. Also called the “net product” method, it includes three statistics:

Ø  Gross Value Added: Estimation of the gross value of various domestic economic activities.

Ø  Intermediate Consumption: Determination of the cost of materials, supplies, and labor used to create goods and services.

Ø  Value of Output: Deduction of the intermediate consumption from the gross value, which gives you the GDP. This is how you determine GDP via the production method.

 

Weakness of the Production Method

The major problem with the production method of measuring GDP is that there is no 100% accurate way to determine what is true production. Services like babysitting have no way of being measured, and therefore are not included – though it can be argued that a babysitter allows parents to go out and spend money on a service, like dinner at a restaurant, and therefore has a positive effect on the economy. Also, if you make baked goods or have a small garden, you are producing, but your output is likely not included in the GDP, especially if you do not sell your goods.

 

If you do sell your baked goods, that could be considered part of the underground economy. For example, if you pay a person cash under the table to fix your car, it does not count toward GDP, although a service has been rendered.

 

2. Income Approach

Many economists dislike the production method as a means to measure GDP as it does not include income. Rather, they believe that the money each family brings home is a better way to evaluate the economic strength of the country. Therefore, the income approach measures the annual incomes of all individuals in a country.

 

Incomes are culled from five different areas:

ü  Wages, salaries, and supplementary labor income

ü  Corporate profits

ü  Interest and miscellaneous investment income

ü  Farmers’ income

ü  Income from non-farm unincorporated businesses

 

Once these numbers are added, two further adjustments must be made to arrive at the GDP via this method. Indirect taxes, such as sales taxes at a convenience store, minus tax subsidies (tax breaks or credits) are added to arrive at market prices. Then, depreciation on various hard assets (buildings, equipment, etc.) is added to that to arrive at the GDP number. The idea behind the income method is to try to get a better handle on real economic activity.

 

Weakness of the Income Approach

A quick review of the items utilized in the income approach makes its weakness obvious: Production is not included, nor is saving or investment. When you sit with an investment advisor and invest money in a mutual fund, you are releasing money from your hands to get more back. That is economic activity, but it is not counted in the income approach. Similarly, increased production at factories can occur without higher wages, and because there is a delay from the time the increased production of goods hits the marketplace and sales are recorded, the increased income may not show up in the corporate profits until later.

 

3. Expenditure Approach

There are, in fact, other economic theorists who believe that neither the income approach nor the production method is sufficient. In theory, income is not generated to be hoarded. People might save and invest, but they will definitely purchase needed and desired goods. From this basic viewpoint, the expenditure approach was developed. This approach measures all expenditures by individuals within one year.

 

The components of this method are:

 

Consumption as defined by purchases of durable goods, non-durable goods, and services. Examples include food, rent, gas, clothes, dental expenses, and hairstyling. The purchase of a new house, however, is not included as consumption. Consumption is the largest component of this method of determining GDP.

 

Investment means capital investments, such as equipment, machinery, software, or digging a new coal mine. It does not mean investments in financial products, like stocks and mutual funds.

 

Government Spending is the total of government expenditures on goods and services, including all costs of government employee salaries, weapons purchased by the military, and infrastructure costs. For example, the money spent on the war in Iraq is included, as is the money spent in the stimulus bill in 2008. Social Security and unemployment benefits, however, are not included.

 

Net Exports are calculated by subtracting the value of imports from the value of exports. Exports are goods that are created in this country for other nations to consume, while imports are created in other nations and consumed domestically.

 

Weakness of the Expenditure Method

The weakness of this method is similar in nature to the weakness of the income approach. First, savings are not included in the equation – so savings accounts and stock investments are not accounted for. Also, deeply discounted and even free services from government, business, and nonprofit organizations are included. This presents a problem because the actual value of these services – not what is charged for them – is estimated. For this reason, the final GDP number is likely to be inaccurate.

 

Lastly, some services are counted based on their costs, but that value can be substantially higher than is estimated or reported. For example, when a major infrastructure collapse happens, such as the result of 9/11 or the tornadoes in Alabama, medical and building costs go up. This creates a temporary increase in infrastructure costs, which increases the final GDP number. This skews the numbers by representing a spike – but not a growth curve that is sustainable. Consider this: When you buy a new house, you may spend a lot of money on new furniture – but you do not buy new furniture every month.

Describe the problems in measuring the GDP of a country

 First, GDP figures omit production of goods and services that are not sold on markets. This component includes housework, meals cooked at home, and child care provided by parents, as well as services volunteered for charities and other groups. For example, when parents care for their own children, the value of their care does not appear in GDP. However, when parents pay for child care, those services appear in GDP.

Second, GDP includes only a very imperfect estimate of production of goods and services sold on the underground economy (or black market). This activity includes production of illegal goods and services (such as drugs and prostitution). It also includes production of legal goods that goes unreported to avoid taxes. Many estimates suggest that the underground economy in the United States amounts to between 5 and 10 percent of GDP; this figure is even larger in many other countries.

Third, special measurement problems result when GDP includes certain goods that are not sold on markets. When you rent a house or apartment, your expenses appear in GDP as payments for housing services. However, if you own the house or apartment where you live, GDP includes the government’s estimate of the rent that you would pay if you were renting.

Fourth: Substitution bias: As consumers' tastes change and as new technological improvements are introduced, the relative prices of goods change. Such changes are independent of inflation so optimally we would like the real GDP measure to take them into consideration. For example, as more people started using cellular phones, the cost of supplying this service went down and so has price. In the real GDP the value of these services is measured using old, higher prices, overstating the increase in the value of production.

New-good bias: it is very difficult to include new goods into the real GDP: In the base year they did not exist and hence their price was infinite.

Quality-change bias: if you simply take the number of TV sets produced and multiply it by the price of a typical TV set in the base year, the value of production is going to be underestimated, as this measure does not take into account the improvements in quality.

 

GDP is the value of goods and services produce in a country during the time period of year.

Discuss about major channels of Director Marketing

Direct marketers can use a number of channels for reaching individual prospects and customer. Those channels are describe below-

Face to face selling: -

The original and oldest form of direct marketing is the field sales call. Today most industrial companies rely heavily on a professional sales force to locate prospects, develop them into customers, and grow the business, or they hire manufacturers’ representatives and agents to carry out the direct selling task.

Direct Mail:

Direct mail marketing involves sending an offer, announcement, reminder or other item to a person. Using highly selective mailing list, direct marketers send out millions of mail prices each year –letters, folders and other “sales people with wings “ Some direct marketers mail audiotapes, videotapes, CD’s, and computer diskettes to prospect and customers.

Catalog Marketing:

In catalog marketing companies may send full line merchandise catalogs, specially consumer catalogs and business catalogs, usually in print form but also sometimes as CD’s , Videos, or online.

E- Marketing:

The newest channels for direct marketing are electronic. E- Business describes a wide variety of electronic platforms, such as the sending of purchase orders to. Those are the activities company undertakes for marketing and promotion of the product. 

What is Direct Marketing? Discuss the Benefits of direct marketing

A form of advertising in which physical marketing materials are provided to consumers in order to communicate information about a product or service. Direct marketing does not involve advertisements placed on the internet, on television or over the radio. Types of direct marketing materials include catalogs, mailers and fliers.

            Direct marketing removes the "middle man" from the promotion process, as a company's message is provided directly to a potential customer. This type of marketing is typically used by companies with smaller advertising budgets, since they cannot afford to pay for advertisements on television and often do not have the brand recognition of larger firms.

Philip Kotler & Gray Armstrong: Direct marketing consist of direct communications with carefully targeted individual consumers to both obtain an immediate responses, and cultivate lasting customer relationships.

American Direct Marketing Association: Direct marketing is an interactive form of marketing using one or more advertising media to affect a measurable response and or transaction at any location.

Benefits of direct marketing:

Direct marketing gives you the opportunity to promote your products and services directly to the customers who most need them. A good direct marketing campaign will:

·         help you build relationships with new customers

·         test the appeal of your product or service

·         tell you which marketing approaches reach your target market

·         increase sales.

Direct marketing campaigns require careful planning and a clear understanding of responsible direct marketing practice. Being aware of the benefits and challenges of direct marketing will help you use direct marketing effectively as follows:

Making the most of direct marketing

A well-planned direct marketing campaign can take you straight to your ideal customers.

Target your ideal customers

Using direct marketing allows you to target specific groups of customers with tailored messages.

Market on a budget

Direct marketing that is targeted to a specific audience can help you set realistic sales goals and improve sales results on a tight marketing budget. Businesses can run effective and purposeful direct marketing campaigns at a fraction of the cost of broadcast advertising.

Increase sales to current and lapsed customers

You can increase sales to your existing customers by maintaining reliable customer records and choosing simple, well-planned promotional tactics.

Improve customer loyalty

You can personalize promotions, letters and offers to create an immediate link with your customer and increase their personal connection to your business.

Create new business

When using direct marketing you can communicate directly with your chosen target market and this should give you a better sales success rate than communicating to the mass market, many of whom may not be interested in your products and services. e.g. you could use a direct marketing campaign to:

·         boost sales of a particular product

·         run out discontinued stock

·         renew stale sales figures

·         increase customer contacts

·         directly follow-up on a promotion.

Test and measure your products and sales performance

Direct marketing also allows you to test new markets, review sales results, measure the effectiveness of your sales and advertising tactics, and easily make adjustments to your campaign. Each time you run a direct marketing campaign you should monitor and review the results, using this information to improve the success of your next campaign.

Discuss about measuring forecasting demand. How can we estimating the market demand

 Marketers will want to estimate three aspects of current market demand- total market demand, area market demand and actual sales & market shares.

The total market demand for a product or service is the total volume that would be bought by a defined consumer group in a defined geographic area in a defined time period in a defined marketing environment under a defined level and mix of industry marketing effort. Total market demand is not a fixed number, but a function of the stated conditions. It will also depend on many environmental factors, ranging from the level of consumer health concerns to the weather in key market areas.

Figure A2-1 shows the relationship between total market demand and various market conditions. The horizontal axis shows different possible levels of industry marketing expenditures in a given time period. The vertical axis shows the resulting demand level. The curve shows the estimated level of market demand at varying levels of industry marketing effort. Some minimum level of sales would occur without any marketing expenditures. Greater marketing expenditures would yield higher levels of demand, first at an increasing rate, and then at a decreasing rate. Companies have developed various practical methods for estimating total market demand. A common way to estimate total market demand is as follows:

Q=n x q x p,     Where, Q = Total Market Demand

                                n= Number of buyers in the market

                                q = quantity purchased by an average buyer per year.

                                p = price of an average unit.

Thus, if there are 100 million buyers of compact discs each year, the average buyer buys six discs a year, and the average price is $17, then the total market demand for discs is $10.2 billion = (100 000 000 x 6 x  $17).

 

Estimating Area Market Demand

Companies face the problem of selecting the best sales territories and allocating their marketing budget optimally among these territories. Therefore, they need to estimate the market potential of different cities, provinces, and countries. Two major methods are available: 1) Market-buildup method, which is used primarily by business goods firms, and 2) Market-factor index method, which is used primarily by consumer goods firms.

Market-Factor Index Method

Consumer goods companies also have to estimate area market potentials. A common method for calculating area market potential is the market-factor index method, which identifies market factors that correlate with market potential and combines them into a weighted index. The Market Rating Index(MRI) for a specific area is given by MRI = percentage of national retail sales in the area / percentage of national population in the area.

Estimating Actual Sales And Market Shares

Besides estimating total and area demand, a company will want to know the actual industry sales in its market. Thus, it must identify its competitors and estimate their sales.

Industry’s trade associations often collect and publish total industry sales, although not individual company sales. In this way, each company can evaluate its performance against the industry as a whole.

Marketing Management is Demand Management – Evaluate the comment

 Most people think of marketing management as finding enough customers for the company’s current output, but this is too limited a view. The organization has a desired level of demand for its products. At any point of time, there may be no demand, adequate demand. Irregular demand, ar too much demand and marketing management must find ways to deal with these different demand statuses. Marketing Management with        not only with finding and incurring demand, but also with changing or even reducing it. Thus, Marketing management seeks to affect the level, timing and native of demand in a way that helps the organization achieve its objectives, so that people says, Marketing Management is a Demand Management.

Explain in the fundamental concepts of Marketing Management? Marketing management is the demand management- Explain.

 Marketing means working with markets to bring about exchanges for the purpose of satisfying human needs and wants.

      Marketing Management as the analysis, planning, implementation & control programs designed to create, build and maintain beneficial exchanges with target buyers for the purpose of achieving objectives.

There are five concepts under which organizations conduct their marketing activities: the production, product, and selling, marketing & social marketing concepts.

a)      The production concept holds that consumers favor products that have available at low cost and that management’s task is to improve production efficiency & bring down prices.

b)      The product concept holds that consumers favor quality products and that little promotional effect is this required.

c)      The selling concept holds that consumers will not buy enough of the company’s products unless stimulated through heavy selling & promotion.

d)     The marketing concept holds that a company should research the needs and wants of a well-defined target market and deliver the desired satisfactions.

e)      The social Marketing concept holds that the company should generate customer satisfaction and long run societal well being as the key to achieve both its goals and its responsibilities.

“Marketing Management is a Demand Management”-explain

 Marketing management is a business discipline which is focused on the practical application of marketing techniques and the management of a firm's marketing resources and activities. Marketing managers are often responsible for influencing the level, timing, and composition of customer demand accepted definition of the term. In part, this is because the role of a marketing manager can vary significantly based on a business's size, corporate culture, and industry context.

For example, in a large consumer products company, the marketing manager may act as the overall general manager of his or her assigned product. To create an effective, cost-efficient marketing management strategy, firms must possess a detailed, objective understanding of their own business and the market in which they operate. In analyzing these issues, the discipline of marketing management often overlaps with the related discipline of strategic planning.

In economics, demand management is the art or science of controlling economic demand to avoid a recession. Within manufacturing firms the term is used to describe the activities of demand forecasting, planning, and order fulfillment. On the other hand, Marketing management is the art and science of choosing target markets and building profitable relationships with them

Ø  What customers will we serve?

Ø  How can we best serve these customers?

Marketing management and demand management both are run parallel or similar. If one are not able to make strategies to fulfill the demand of market/consumer, they cannot run their business successfully. Finding the customer needs and making policies to provide them facilitate them; all depend on your marketing plan. How much effective plan you will make for your customer, customer will be loyal with you as much. So we can say that a good marketing management system is the demand of business to retain your customer.

Marketers are indeed skilled at stimulating demand for their company’s products, but that too limited a view of the tasks they perform. Just as production and logistics professionals are responsible for supply management, marketers are responsible for demand management. Marketing managers seek to influence the level, timing, and composition of demand to meet the organization’s objectives. The following demand states are possible in context of marketing management.

·         Negative Demand: Consumer dislikes the product and may even pay a price to avoid it.

·         No Demand: Consumers may be unaware of or uninterested in the product.

·         Latent Demand: Consumers may share a strong need that cannot be satisfied by an existing product.

·         Declining Demand: Consumers being to buy the product less frequently or not at all.

·         Irregular Demand: Consumer purchases vary on a seasonal, monthly weekly daily or even hourly basis.

·         Full Demand: Consumers are adequately buying all products put into the marketplace.

·         Overfull Demand: More consumers would like to buy the product than can be satisfied.

·         Unwholesome Demand: Consumers may be attracted to products that have undesirable social consequences.

In each case, marketers must identify the underlying cause of the demand state and then determine a plan of action to shift the demand to a more desired state. Thus, Marketing Management is a Demand Management.

What do you mean by Marketing? Discuss the importance of Marketing. Explain “Marketing Management is a Demand Management”. Explain the fundamental concept of Marketing Management. What are the goals of Marketing System? Explain the chanallenges of Marketing.

What do you mean by Marketing? Discuss the importance of Marketing. Explain “Marketing Management is a Demand Management”. Explain the fundamental concept of Marketing Management. What are the goals of Marketing System? Explain the chanallenges of Marketing.

Marketing is the process of communicating the value of a product or service to customers. Marketing might sometimes be interpreted as the art of selling products, but selling is only a small fraction of marketing.

The American Marketing Association defines marketing as "the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large."

Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers in return. Marketing is a process of planning and executing the conception, pricing, promotion and distributing of ideas, goods and services to create exchanges that satisfy individual and organizational objectives. From a societal point of view, marketing is the link between a society’s material requirements and its economic patterns of response. Marketing satisfies these needs and wants through exchange processes and building long term relationships.

 

Q:  Mention the importance of marketing

Marketing is a process by which companies create value for customers and build strong customer relationships to capture value from customers in return. Marketing is a process of planning and executing the conception, pricing, promotion and distributing of ideas, goods and services to create exchanges that satisfy individual and organizational objectives.

Marketing is a very important aspect in business since it contributes greatly to the success of the organization. Production and distribution depend largely on marketing. Many people think that sales and marketing are basically the same. These two concepts are different in many aspects. Marketing covers advertising, promotions, public relations, and sales. It is the process of introducing and promoting the product or service into the market and encourages sales from the buying public.

Since the goal of marketing is to make the product or service widely known and recognized to the market, marketers must be creative in their marketing activities. In this competitive nature of many businesses, getting the product noticed is not that easy. Strategically, the business must be centered on the customers more than the products. Although good and quality products are also essential, the buying public still has their personal preferences. If you target more of their needs, they will come back again and again and even bring along recruits.

Marketing Promotes Product Awareness to the Public

It has already been mentioned in the previous paragraph that getting the product or service recognized by the market is the primary goal of marketing. No business possibly ever thought of just letting the people find out about the business themselves, unless you have already established a reputation in the industry. Various types of marketing approaches can be utilized by an organization.

Marketing Helps Boost Product Sales

Apart from public awareness about a company’s products and services, marketing helps boost sales and revenue growth. Whatever your business is selling, it will generate sales once the public learns about your product through TV advertisements, radio commercials, newspaper ads, online ads, and other forms of marketing.

Marketing Builds Company Reputation

In order to conquer the general market, marketers aim to create a brand name recognition or product recall. This is a technique for the consumers to easily associate the brand name with the images, logo, or caption that they hear and see in the advertisements.

Role of Marketing Research

 Marketing research is the systematic and objective search for, and analysis of, information relevant to the identification and solution of any problem in the field of marketing." Marketing research can be concerned with any of a variety of aspects of the market: the product, sales, buyer behaviour, promotion, distribution, pricing, packaging, etc. Since the researcher cannot investigate everything about a market, he/she must be selective. The brief must inform the researcher which aspects of the market are particularly important. In particular, the research brief should include:

• the purpose of the research
• the objectives stated in a clear, concise, attainable, measurable and quantifiable way
• a time horizon
• a resource allocation, including the budget and facilities
•  a reporting period.

Role: Market research is one of the vital components of marketing: it plays its part before one makes any policy decisions in the field of marketing and communications. Market research can be defined as "the implementation of subjective and objective research methods, whose aim is to collect information and analyze it. This information constitutes the basis that enables marketers to (re)define and evaluate their strategies". This information is generally concerning behavior, attitudes and motivations of a particular target group. Market research is the first step before any decisions are taken. As a supplier of information its role is only effective if it enables companies to make useful marketing decisions. Research is conducted throughout the marketing process: at each stage the reactions of the target public, after being analyzed, enable one to review the policies.

Types and Methods of Research

Every Research needs lots of dedication from the researcher’s part-the amount of dedication mainly depends on the subject matter of the research. Any scientific research may fall into the following three broadly categories:

Exploratory research-This type of research may generate any novel idea in the domain of knowledge. It is primarily done for the purpose of finding anything new in any subject arena and always tries to shed some light in the unknown domain of knowledge.

Constructive research- This is mainly done by many technological corporates in order to find new/alternative solutions to any particular crisis or problems. For example-renewable energy research or development of the capacity of optical fiber may fall into this category of research.

Empirical research-This is very impressive observational type of research, where one observes or test on real-life data or analysis the pattern of some specific events in order to identify the nature or the class of trend that specific phenomenon maintains. Based on the test result, researchers try to draw lines in order to predict the result of that type of incidents with certain level of confidence.

Research method is a way of collecting inputs and finding the outputs, to conduct your research successfully.

As a research method you can choose one of the following or a combination:

Experiments-this is used in exploratory type research. What types of experiments necessary depends on the research topic. This is very time consuming and expensive type of research method.

Surveys-this is used in empirical or exploratory type of research, usually used in business studies. You can use questionnaires or even interview some specific group of people to get your research result.

Observation – observational data can be recorded in order to find empirical relationship between different parameters of your research. One disadvantage of this type of research is that it is very time-consuming and expensive method.

Existing data-this type of research is done on the available data to find any findings or patterns in the data. This is the most effortless, time-saving and less-expensive type of

Pricing Strategy

 Pricing strategies for products or services encompass three main ways to improve profits. These are that the business owner can cut costs or sell more, or find more profit with a better pricing strategy. When costs are already at their lowest and sales are hard to find, adopting a better pricing strategy is a key option to stay viable.

Merely raising prices is not always the answer, especially in a poor economy. Many businesses have been lost because they priced themselves out of the marketplace. On the other hand, many business and sales staff leave "money on the table". One strategy does not fit all, so adopting a pricing strategy is a learning curve when studying the needs and behaviors of customers and clients.

Model of Pricing: Cost-plus pricing, Skimming, Limit Pricing, Loss Leader, Market oriented pricing, Penetration Pricing, Price discrimination, Premium pricing, Predatory Pricing, Contribution margin – based pricing, Psychological pricing, Dynamic Pricing, Price leadership, Target Pricing, Absorption pricing, High-Low Pricing, Premium decoy pricing, Marginal-cost pricing, Valur-based pricing, Pay what you want, Freemium, Odd pricing.

Customer delightness or satisfaction

 The very favorable experience of the client of a business when they have received a good or service that significantly surpasses what they had initially anticipated. A marketing department can use instances of customer delight to a company's advantage by requesting referrals and obtaining testimonials from delighted customers that can help attract new customers. Ingredient of customer delight ness:

·         It produces a ‘wow’ reaction!

·         It appears spontaneous or unexpected!

·         It’s the personal touch!

·         It makes customers feel ‘valued’

·         It’s genuine!

·         It creates a ‘talking point’!

 

Customer Satisfaction = Perceived Service – Expected Service

Types of customer satisfaction: Criminal, Basic, Expected, Desirable, Unbelievable

Niche marketing

 Concentrating all marketing efforts on a small but specific and well defined segment of the population. Niches do not 'exist' but are 'created' by identifying needs, wants, and requirements that are being addressed poorly or not at all by other firms, and developing and delivering goods or services to satisfy them. As a strategy, niche marketing is aimed at being a big fish in a small pond instead of being a small fish in a big pond. Also called micromarketing.

            A niche market is the subset of the market on which a specific product is focusing. So the market niche defines the specific product features aimed at satisfying specific market needs, as well as the price range, production quality and the demographics that is intended to impact. It is also a small market segment. For example, sports channels like STAR Sports, ESPN, STAR Cricket, and Fox target a niche of sports lovers.