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NARSEE MONJEE INSTITUTE OF MANAGEMENT STUDIES (Deemed University) Distance learning programs in management DBM/PGDBM/DMM/PGDMM I Total Marks-100 Time 3 hrs Section 1-

Consumer Behavior

(40 marks)

Fill in the blanks(20 marks) 1.Which of the following statements is not true about the concept of a customer? a) A customer and consumer are always the same thing - the terms are completely interchangeable b) A customer doesn't necessarily consume the product that they have purchased c) Students can be described as customers of a university 2. When Steve goes to the grocery store every other week, he buys the same brands of coffee, milk, cereal, and dog food. This type of buying behaviour is called a) b) c) d) e)

Routine response behaviour Extensive decision making Limited decision making Situation convenience Both (b) and (d) above

3. Decision making perspective believes that consumers make decision on -----------basis. Emotional/rational/ external pressure 4. ------------ is that to which an individual doesn’t belong but would like to belong to. contractual group /primary group /aspirational group 5 The process where by a child acquires skills, knowledge, attitude, necessary to function as consumers is called consumer___________

enlightenment/initiation/socialization 6 _____________ are the last people to adopt an innovation 7 A secretary who answers calls from suppliers, for a company buyer, may be taking on which role within the company’s decision-making unit? (a) User (b) Influencer (c) Gatekeeper (d) Buyer (e) Decider. 8

Involvement with a purchase is high when the ______________ Perceived risk is low/ when product is interesting/when perceived risk is high

9

___________ image describes how individuals feel others see them Ideal social self/ideal self/social self

10. Incomplete task is better remembered than complete task this is called _________ Zeigernik effect/halo effect/subjectivity 11 ________________ is based on trial and error learning instrumental conditioning/ classical condition/cognitive learning 12

___________ is the process by which we recover information from long term memory reinforcement/ call back/ retrieval

13 The theory of reason action model measures both attitude towards behavior and ________ as a background to intention buy Subjective norms/rational thought/emotional charge 14 In the tricomponent attitude model___________component measures knowledge and beliefs. Affective/cognitive/conative

15 According to Sigmund Freud personality is a product of struggle of three interactive forces-Id, Ego and _________. 16 When there is high involvement and many difference between brands, individuals display ____________buying behavior dissonance reducing/variety seeking/Complex 17 Out of the awareness set, only some brands will fall in ___________set. consideration set/ total set/purchase set 18 In the expectancy value model, marketers strategy of altering beliefs about brands is an example of ______________ repositioning Psychological repositioning/ Competitive depositioning/real positioning

19

Which of the following consumer responses is least likely to overcome cognitive dissonance experienced by a consumer who is dissatisfied with their purchase? a) Rationalizing that a product is actually quite good b) Seeing the product in a different light so that the bad aspects of a product are emphasized c) Seeing the product in a different light so that the good aspects of a product are emphasized d) Complaining and returning goods to the supplier e) Find alternative uses of the product.

20 Pooja, a Chartered Accountant, reads an article that states that CAs receive the highest starting salary offers from consulting firms. The article also states that marketing majors start with lower salaries but surpass all other majors' salaries within ten years. Pooja doesn't remember reading this last part of the article, just the first part. This is an example of (a)Selective distortion (b) Selective exposure (c)Selective retention (d) Subliminal perception (e) Selective comprehension

Read the caselet carefully and answer the following questions: 1. Discuss the various bases or criteria for segmenting consumer markets. Explain Tanishq’s segmentation and positioning strategy. (12 marks)

2. What are Tanishq’s key brand values or brand strengths? Explain. (8 marks) The market for jewellery in India is second only to that for foods and the trade is built around so-called family jewelers. Tanishq belongs to the House of Tata and, true to the group's policy it aims at bringing in credibility and professionalism to the jewellery industry. India's jewellery market is estimated to be worth Rs. 400 billion a year and the share of the organised sector – jewellery stores and brands managed by corporate houses - stands at about Rs. 10 billion. This small but significant niche is largely the creation of Tanishq, a path-breaking effort that has earned a well-deserved reputation for reliability and excellence, and for introducing pioneering concepts in an industry where tradition once ruled. The brand has a 40% share of the organised jewellery market and a 1% bite of the overall jewellery pie. There are more than 300,000 independent, non-branded jewellery retailers in India. Tanishq was a trailblazing endeavour to create a national retail chain that would provide consumers with jewellery of reliable worth and high design value. Its entry changed, in more ways than one, the way the Indian jewellery market operates. With 66 exclusive outlets spread across some 50 cities and a fully integrated jewellery manufacturing facility at Hosur, in Tamil Nadu, Tanishq has emerged as one of India's biggest retailers. The introduction of 'Karatmeters' - instruments that can be easily used by consumers to measure the purity of gold in a non-destructive manner - at its outlets is a key innovation that has developed tremendous equity for the brand. Another Tanishq novelty, one on which the brand's growth strategy is premised, is in the matter of differentiated designs, be they contemporary or traditional, Indian or international. Modern retail values and principles in the selling of branded jewellery in India are almost completely the handiwork of Tanishq. The brand has broken fresh ground in retailing by creating exclusive outlets with hitherto unknown in-store ambience and hospitality touchstones. It has launched new collections at a quicker rate than its competitors, and conducted marketing promotions and fashion shows to enhance the shopping experience of consumers. Although the purchase of branded jewellery is still a new experience for a whole lot of Indians, the Tanishq brand enjoys increasing levels of consumer loyalty. In 2002, about one million people shopped at Tanishq stores all over the country. A highlight of the brand's success is that, while the jewellery market growth has declined during the past two years, Tanishq has recorded an annual growth of approximately 40%. Besides catering to Indian consumers, Tanishq has successfully entered key export markets such as the US, the UK, the Middle East, Singapore and Australia. This is testimony to the brand's ability to craft products that meet the requirements of varied cultures and sensibilities. The brand Tanishq, like the Tata name, has established itself as an ethical brand, earning the respect and affection of its consumers. The Tanishq portfolio comprises a wide range of jewellery, including 18-carat studded products, 22-carat plain-gold products, silverware and coins. Tanishq is the first brand in the jewellery category to introduce collections designed exclusively for the modern Indian woman, especially working women. Among the Tanishq collections that have

caught the imagination of consumers are Aria and Diva. Collection G, with a selection of over 90 designs, addressed the everyday jewellery needs of working women. Positioned as ‘9-to-5 jewellery’, the collection is stylish and modern and is designed to suit all forms of attire, western and Indian, casual and formal. The introduction of lightweight gold –jewellery that looked heavy but was light in weight and on the purse – marked another milestone in Tanishq’s brand history. Tanishq’s retail boutiques are temples for the brand and are used as a platform for celebration, be it the launch of a new collection, a new marketing promotion or a festival. This gives Tanishq outlets a unique appeal and consumers an opportunity to heighten their shopping experience. One of Tanishq’s more innovative ideas is to offer special schemes during various festivals. Tanishq has also initiated a loyalty program called the Golden Harvest Savings Scheme, which offers buyers the benefit of getting more jewellery than what they have paid for. The scheme allows consumers to planfuture purchases in advance and pay for them in easy installments. In sync with the Tata brand values, Tanishq is synonymous with trust and purity in a category that is fraught with questionable practices. Being a member of the Tata family has meant that it can leverage the group’s well-earned reputation for ethics and values in a business where such attributes are critical to win the trust of consumers. Tanishq consumers can afford to take issues such as purity for granted, and they know they can depend upon the brand to deliver quality products all the time. The brand’s winning virtues in design and overall quality have shaped a class of discerning buyers who seek the best in jewellery products. Leadership and innovation are two of the other brand features that Tanishq is consistently identified with. These values have helped the brand bond with its consumers like no other Indian jewellery retailer. Tanishq has deliberately moved away from mass-media advertising and focused on store promotions to make the brand more accessible to consumers. This has been done to correct the consumer perception that the brand is highly priced and only meant for the rich and the famous. This approach has also ensured that Tanishq’s promotional approach is product-led.

Section 2 Integrated Marketing Communication

(marks-60)

Fill in the blanks/complete the sentence( marks 10) 1.Sony’s communication objective is to achieve 95 percent awareness for its latest camcorder model during the six-month introductory period. Which of the following methods can Sony use to set its advertising budget? (a) Affordable method (b) Percentage of sales method

(c) Objective and task method (d) Competitive parity method (e) Discount method. 2.The statement that "It costs five times as much to attract a new customer as it does to keep an old customer" means that firms should (a) Advertise more (b) Build lasting customer relationships (c) Provide quality products (d) Price their products low (e) Customize their products. 3. Magazine have a long life span and ___________ readership 4. There are four kinds of images that a company can project: current image, mirror image, wish image and ____________image. 5. Rajeev Kapoor is a chef in a new downtown restaurant. He has sent out press releases to the major local media and has invited food critics to dine in his restaurant. Rajeev is engaging in a. Public relations b. Personal selling c. Sales promotion d. Advertising e. Publicity. 6. A rental car company with the second largest market share runs advertisements showing how its customer service is superior to that of the largest competitor. This is an example of a. Comparative advertising b. Corrective advertising c. Primary demand advertising d. Institutional advertising e. Pioneering advertising.

7. When Procter & Gamble introduced Swiffer, a new product to make it easier to clean increasingly popular hardwood floors, it knew it had to achieve high brand awareness among its potential consumers because the product was low-tech and fairly easily imitated. Which promotional element did P & G emphasize? (a) Advertising (b) Personal selling (c) Sales promotion (d) Public relations (e) All of the above equally.

8. When the salesperson told the safety engineer his company needed to buy a mercury clean-up kit, the engineer promptly replied his company did not need such a thing and refused to introduce the salesperson to the company’s purchasing agent. In this instance, the safety engineer acted in which buying center role? (a) Influencer (b) Buyer (c) User (d) Decider (e) Gatekeeper. 9. Which type of advertising is most appropriate for introducing new product categories? (a) Reminder advertising (b) Informative advertising (c) Persuasive advertising (d) Comparison advertising (e) Reinforcement advertising.

10.A company in its communication message lays emphasis on the quality, performance and value of its products. What is the communication objective of the company? (a) Awareness (b) Knowledge (c) Liking (d) Action

Section II (Do any two question) 1) Enumerate the various forms of consumer promotion. 2) What is scheduling and the various patterns 3) Elaborate how reason-why reinforces the benefit promise 4) What is reach and gross rating points

Section III Read the caselet carefully and answer the following questions: What was the initial positioning strategy adopted by Lifebuoy? Was it successful? If ‘yes’ then why it had to relaunch and reposition its product again? (8 marks) What do you think were the strengths and weaknesses of the Brand? What steps do you suggest and why do you suggest those steps for the brand in future? (to be taken by the company). (12 marks) BRAND BUILDING - THE EXAMPLE OF LIFEBUOY, THE 100 YEAR OLD BRAND Nurturing a brand into a strong, profitable brand is a challenging task. It is worth examining the case of Lifebuoy which provides an instance of successful brand building.

Lifebuoy is probably the oldest toilet soap available today. From its small beginnings in England in 1894, Lifebuoy has come a long way to become one of the most popular and largest selling soaps in the world. In the Indian market, Lifebuoy has been enjoying a place of prominence ever since it was introduced in its red tablet form in 1895. From a sale of 200 tonnes, Hindustan Lever now sells 1.25 lakh tonnes of Lifebuoy which accounts for 39 percent of the total 3.20 lakh tonne toilet soap market of India. When Lifebuoy was introduced in the Indian market 100 years ago, its positioning was clear. Lifebuoy was the soap that would destroy germs and keep the body healthy. To quote Hindustan Lever "It was the clean, honest hardworking brand with no frills". Though the properties were clear, the brand found the going tough especially in rural markets where the concept of using toilet soap was alien. Most rural people were accustomed to bathing with plain water. Therefore, HLL decided to launch Lifebuoy as soap for hand wash. After initial resistance, the brand began to look up. By 1900, it had established itself as a good medium for hand wash. At this stage the brand's inherent properties were expanded and Lifebuoy was repositioned as bath soap. 'Where there is Lifebuoy, there is health" became a very popular jingle. In 1964, the brand was relaunched with a slight change in its shape and wrapper design. The relaunch was also backed by advertising the health aspect. Rural promotions were intensified with mobile display-cum-sales vans. And during this period Lifebuoy started associating itself with sports events. This kind of sales promotion helped Lifebuoy to gain a more 'macho image' and it was getting accepted as a champion's soap. By the seventies, competitors also entered the market; Lifebuoy's supremacy was being challenged, especially in the rural markets. Those were anxious years for HLL as the rural markets were the brand’s mainstay. The USPs in the soap market was also fast changing from health care to deodorant-based products. HLL defended Lifebuoy from the challengers by reinforcing the brand. HLL now launched Lifebuoy Personal - perfumed, pink-coloured, 75 gm soap. But the brand suffered because it did not carry the USPs of health and value for money. HLL subsequently mended these drawbacks. In the eighties HLL made special attempts to make Lifebuoy more acceptable to urban consumers. To quote HLL, "Lifebuoy was considered down-market especially in the urban areas. So, we had to instil a sense of pride in the user and not be ashamed of using Lifebuoy". This thinking resulted in the launch of Lifebuoy Plus, which basically was the old Lifebuoy with a new perfume. Backed by high-powered advertising, HLL managed to popularise Lifebuoy Plus. 'With Lifebuoy Plus, we could widen the appeal to new urban consumers. By this time Liquid Lifebuoy also staged its entry to strengthen the brand's presence in the urban market. In the rural markets Lifebuoy continued its dominance; there was the old, stubborn user in the rural areas who continued to patronise Lifebuoy. Even today 60 percent of lifebuoy sales are from rural areas. The brand remains the largest selling brand and a Cash Cow for HLL. Read the caselet carefully and answer the following questions:

Is PSI successful in delivering the message to the target audience? Justify your comments. (8 marks) Government represented organisations play a vital role in the social marketing campaigns. Explain the advantages and disadvantages if government has an active role in such campaigns. (12 marks) The question has the assembled audience squirming. "How many of you have touched a condom this week? Those who have, raise your hands," urges the speaker. Amidst silence, some shifting and some embarrassed laughter, Sanjay, Programme Director (HIV/AIDS Prevention), Population Services International (PSI), tries to make the point that the stigma attached to discussing sexual health issues is more dangerous than the virus that causes AIDS. Sanjay is giving a presentation at the regional conference on AIDS prevention. PSI, which was set up in India in 1988, uses social marketing to deliver health products and services to lower-income groups in developing countries, to motivate their use and promote healthy behaviour. A Washington, DC-based non-profit organisation working in over 50 countries, its forte is AIDS prevention, family planning, maternal and child health. In India, PSI markets its own brand of Masti condoms, and helps market the Kama Sutra and Nirodh Dlx brands in smaller towns and remote areas. Among other health products it markets are the Pearl brand of contraceptive pills, the Union Government's Mala D, oral rehydration solution and a clean delivery kit. PSI, which has just launched a campaign in Tamil Nadu and Andhra Pradesh, among the States with the highest incidence of HIV, is involved in social marketing and communications for health. Aimed at increasing awareness of the risk of contracting HIV/AIDS through unprotected sex with non-regular partners and at busting certain misconceptions associated with it, the campaign has two parts to it. The campaign is part of Operation Lighthouse, a port-based HIV/AIDS/STD intervention, set to reach millions of people, specifically vulnerable populations in port communities, with the information, services, and products they need to protect themselves from HIV/AIDS. The key target groups include truck drivers, commercial sex workers and their clients, and port workers. These high-risk populations are responsible for the vast majority of HIV incidence in port communities. They also play a critical role in accelerating the spread of HIV to the general population. "Puli Rajavukku AIDS varumaa?" is the horrified question that rings through the teaser ad. This goes on to three more spots which advise the target 'consumer' to practise safe sex with non-regular partners. The other part urges the target group to `be faithful'. The exercise is based on the Balbir Pasha campaign that PSI ran in Mumbai, one that generated much controversy and flak for the organisation. The Balbir Pasha campaign (developed by Lowe) was slammed for being "anti-women", perceived as implying that women spread HIV/AIDS and charged with stigmatizing sex workers but was "remarkably successful" in that post campaign, PSI's helpline received 250 per cent more calls; its Saadhan clinics, (Saadhan integrates the multiple issues of family health by offering more accessible information on more choices) voluntary counselling and testing centres, had

150 per cent more visitors and there was a 300 per cent rise in all brands of condoms sold in the red light district of Mumbai. The Puli Raja campaign uses TV, radio, print and outdoors. It uses locations frequented by the target group. In Mumbai, Kolkata and Delhi, there are clearly defined red light areas, but not so in TN and AP, which is major challenge of this endeavour. The points that PSI seeks to address are, that a healthy-looking person or known partner need not necessarily be HIV/AIDS-free, and that alcohol-induced forgetfulness leads to the failure of using a condom. In fact, this is the ideal on which the second sub-campaign, Be Faithful, is based. It shows how, by having extra-marital affairs, men can give HIV to their wives and thus to unborn children, putting their lives at risk. Puli Raja, who was visualised as a tall, hefty, invincible, fun-loving hero in pre-campaign testing, actually remains faceless throughout the campaign. "He is every man, his conscience. He's an idea. By keeping him abstract, it's easier for those in the target group to identify with him. Giving him a face will lead people to develop associations and reject similarities with him. The organisation is looking at developing a campaign with a local celebrity who urges the target group to overcome their reserve in talking about AIDS. In Mumbai, the Balbir Pasha campaign was followed by a primarily print one which created awareness of the Saadhan clinics, and this is what is planned for TN and AP too. The campaign tries to break away from the established pattern of social cause advertising, which is "not engaging" though informative. Mass media can be effective in such contexts if they are used strategically, PSI's tack is to focus on the consumer, get him involved in on-ground activity (interpersonal communication) and then go on to making him aware of the products and the services available.