Marketing Management – II CBCBA6T12A

Syllabus topics (RTMNU)

• Meaning and significance of consumer behaviour
• Understanding Industrial and individual buyer behaviour – influencing factors
• Responding to buyer behaviour
• Online buyer behaviour
• Building and measuring customer satisfaction
• Customer relationships management
• Customer acquisition, Retaining, Defection

Meaning and Significance of Consumer Behaviour

Consumer behaviour is the study of how individuals, groups and organisations select, buy, use and dispose of goods, services, ideas or experiences to satisfy their needs and wants.

Significance: helps in market segmentation and targeting; product design as per needs; deciding price, place and promotion; predicting market trends; building loyalty; designing better services; reducing failure of new products; useful to government and consumer bodies for consumer protection.

Individual Buyer Behaviour and Influencing Factors

Buying decision process (5 stages): (1) need recognition → (2) information search → (3) evaluation of alternatives → (4) purchase decision → (5) post-purchase behaviour (satisfaction or cognitive dissonance).

Factors influencing consumer behaviour (Kotler):

1. Cultural – culture, sub-culture (religion, region, language), social class. E.g. festival buying during Diwali and Ganeshotsav.
2. Social – reference groups, family, roles and status, opinion leaders and influencers.
3. Personal – age and life-cycle stage, occupation, income, lifestyle, personality and self-concept.
4. Psychological – motivation (Maslow), perception, learning, beliefs and attitudes.

Industrial (Organisational) Buyer Behaviour

Industrial buying is the decision process by which organisations buy goods and services for production, resale or operations (e.g. a car maker buying steel).

Features: fewer but larger buyers; derived demand (depends on consumer demand); professional purchasing; buying centre (several people involved – users, influencers, buyers, deciders, gatekeepers); formal procedures (tenders, quotations); long-term relationships; rational rather than emotional buying.

Types of buying situations: straight rebuy, modified rebuy, new task.

Factors: environmental (economy, technology, government policy), organisational (objectives, policies, systems), interpersonal (authority, status of buying-centre members), individual (age, education, risk attitude of buyers).

Responding to Buyer Behaviour

Marketers respond by: identifying the decision-makers and influencers; providing information at the search stage (ads, websites, reviews); offering trials and demonstrations; making buying easy (EMI, online ordering, many outlets); reducing post-purchase dissonance through warranties, follow-up calls and easy returns; and using loyalty programmes. For industrial buyers – technical support, customised offers, credit terms and key-account management.

Online Buyer Behaviour

Online buyer behaviour is the process of searching, comparing and buying products through the internet and apps.

Factors: convenience (24×7 shopping), price comparison and discounts, product variety, reviews and ratings, trust and security of payment (UPI, cash on delivery), website/app ease of use, delivery speed, return policy, social media influence.

Trends: mobile-first shopping, quick-commerce, social commerce (buying through Instagram/WhatsApp), voice and vernacular search, buy-now-pay-later.

Building and Measuring Customer Satisfaction

Customer satisfaction is the feeling of pleasure or disappointment that results from comparing a product's perceived performance with expectations. Performance < expectations → dissatisfied; = → satisfied; > → delighted.

Building satisfaction: understand expectations; deliver consistent quality; train staff; quick complaint handling; keep promises in ads; personalised service.

Measuring satisfaction: customer satisfaction surveys (rating scales); Net Promoter Score (NPS = % promoters − % detractors); complaint and suggestion systems; mystery shopping; lost-customer analysis; online reviews and ratings; repeat-purchase rate.

Example: of 200 customers, 120 are promoters and 30 detractors → NPS = 60% − 15% = 45.

Customer Relationship Management (CRM)

CRM is the overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction. It uses customer databases and software to manage each "touch point".

Benefits: customer loyalty, higher lifetime value, cross-selling and up-selling, word-of-mouth, better targeting. Tools: loyalty cards, personalised offers, CRM software, call centres, WhatsApp updates.

Customer Acquisition, Retention and Defection

• Customer acquisition – attracting new customers through advertising, offers, referrals and digital marketing. Cost per acquisition is usually high.
• Customer retention – keeping existing customers through quality, service, loyalty programmes and relationship building. Getting a new customer often costs several times more than keeping an existing one.
• Customer defection (churn) – customers leaving for competitors because of poor service, high price, better offers elsewhere or unresolved complaints. Firms reduce defection by tracking churn rate, exit surveys, win-back offers and fixing root causes.

Churn rate = customers lost during the period ÷ customers at the start × 100. Example: lost 50 out of 1,000 → 5%.

Likely exam questions

1. (Long, 8/16 marks) What is consumer behaviour? Explain the factors influencing consumer buying behaviour.
2. (Long, 8/16 marks) Distinguish between individual and industrial buyer behaviour. Explain the factors influencing industrial buying.
3. (Short, 4 marks) Explain the stages of the consumer buying decision process.
4. (Short, 4 marks) How is customer satisfaction measured?
5. (Short, 4 marks) Write a note on customer acquisition, retention and defection.

Syllabus topics (RTMNU)

• Distribution Channel: Types and Importance
• Channel Intermediaries: Wholesalers and Retailers
• Promotion mix: Introduction to personal selling
• Sales Promotion
• Public Relations and Publicity

Distribution Channel: Meaning, Types and Importance

A distribution channel is the path through which goods move from the producer to the final consumer, including all the intermediaries involved.

Types (levels):

• Zero-level (direct): Producer → Consumer (door-to-door, company website, factory outlets).
• One-level: Producer → Retailer → Consumer (cars, large appliances).
• Two-level: Producer → Wholesaler → Retailer → Consumer (FMCG goods).
• Three-level: Producer → Agent → Wholesaler → Retailer → Consumer.
• Industrial channels: Producer → Industrial distributor → Industrial user.
• Hybrid / omnichannel: several channels together (stores + app + marketplace).

Importance: makes goods available at the right place and time; breaks bulk into small lots; provides assortment; stores goods; gives credit; promotes products; collects market information; reduces the number of transactions; bears risk; provides after-sales service.

Factors in choosing a channel: nature of product (perishable, technical, high value), market (size, spread), company resources, intermediaries' availability, competition, cost and control.

Channel Intermediaries: Wholesalers and Retailers

Wholesaler – buys in bulk from producers and sells in smaller lots to retailers or industrial users.

Services of wholesalers: to producers – bulk buying, finance, storage, risk bearing, market information, distribution; to retailers – ready stock, credit, small quantities, variety, information on new products.

Retailer – sells goods in small quantities directly to final consumers. Retailing is the last link in the channel.

Types of retailers:

• Small-scale / itinerant – hawkers, weekly bazaar sellers; fixed shops like kirana stores.
• Large-scale – departmental stores, supermarkets and hypermarkets (D-Mart, Reliance Smart), chain stores (Bata), specialty stores, malls.
• Non-store – e-commerce (Amazon, Flipkart), quick-commerce, direct selling, mail order, vending machines.

Services of retailers: to consumers – convenient location, variety, small quantities, credit, home delivery, product information, after-sales service; to wholesalers/producers – distribution, promotion, feedback on demand.

Promotion Mix and Personal Selling

The promotion mix is the combination of tools a company uses to communicate with customers: advertising, personal selling, sales promotion, public relations/publicity and direct/digital marketing.

Personal selling is the oral, face-to-face presentation of a product to one or more prospective buyers for the purpose of making sales.

Features: two-way communication; personal contact; flexible message; builds relationships; immediate feedback; costly per contact.

Process: prospecting → pre-approach → approach → presentation and demonstration → handling objections → closing the sale → follow-up.

Importance: essential for technical and high-value products (machinery, insurance, real estate); educates customers; gets quick orders; provides market feedback.

Sales Promotion

Sales promotion consists of short-term incentives to encourage the purchase or sale of a product.

Consumer promotions: discounts and price-offs; coupons; free samples; buy-one-get-one; contests and lucky draws; cash-back (common on UPI apps); loyalty points; exchange offers; free gifts.

Trade promotions (to dealers): extra margins, quantity discounts, display allowances, dealer contests, free goods.

Sales-force promotions: bonuses, sales contests, conventions.

Merits: quick increase in sales; attracts new customers; clears old stock; counters competitors. Limitations: short-lived effect; may hurt brand image if overused; customers may wait for offers.

Public Relations and Publicity

Public relations (PR) means building good relations with the company's various publics (customers, employees, investors, media, government, community) by obtaining favourable publicity, building a good corporate image and handling unfavourable rumours.

PR tools: press releases and press conferences; events and sponsorships (sports, cultural); CSR activities (mandatory CSR for eligible companies under Section 135 of the Companies Act, 2013); company newsletters and annual reports; social media engagement; crisis management.

Publicity is non-paid communication about a company or product in the media, such as a news story or review. It is credible but the company cannot control the message.

Likely exam questions

1. (Long, 8/16 marks) What is a channel of distribution? Explain its types and importance.
2. (Long, 8/16 marks) What is the promotion mix? Explain personal selling and sales promotion.
3. (Short, 4 marks) State the services of wholesalers.
4. (Short, 4 marks) Distinguish between advertising and publicity.
5. (Short, 4 marks) State the tools of public relations.

Syllabus topics (RTMNU)

• Digital marketing: Meaning, concept, evaluation
• Difference between digital marketing and traditional marketing
• Opportunities and challenges in digital marketing
• Digital marketing channels: mobile marketing, search engine optimisation, affiliate marketing, and content marketing
• Online consumer: concept, factors influencing, latest trends
• Business requirements for online consumer

Digital Marketing: Meaning, Concept and Evolution

Digital marketing is the promotion of products and brands through digital channels such as websites, search engines, social media, e-mail, mobile apps and online advertising.

Concept: reach the right customer at the right time with the right message, track every click and improve campaigns using data.

Evolution (the syllabus says "evaluation"): 1990s – websites and e-mail; 2000s – search engines (Google), banner ads, e-commerce; 2010s – social media, smartphones, YouTube, influencers; in India – cheap mobile data after 2016, UPI, regional-language content; 2020s – AI-driven personalisation, short videos (Reels, Shorts), WhatsApp Business, voice search.

Digital Marketing vs Traditional Marketing

Opportunities and Challenges in Digital Marketing

Opportunities: huge and growing internet user base in India; low cost; precise targeting; measurable results; small firms can compete with big ones; global reach; personalisation; new careers (SEO, content, social media managers).

Challenges: intense competition and information overload; ad blockers; fake reviews and frauds; data privacy rules (Digital Personal Data Protection Act, 2023); constant changes in platform algorithms; need for skilled people; digital divide in rural areas; negative comments spread fast.

Digital Marketing Channels

1. Mobile marketing – reaching customers on smartphones through SMS, WhatsApp Business, mobile apps, app notifications, in-app ads and location-based offers. Example: a food app sending lunch-time offers. Mobile-friendly websites are essential.

2. Search engine optimisation (SEO) – improving a website so that it ranks higher in unpaid (organic) search results.

• On-page SEO – keywords, titles, meta descriptions, quality content, page speed, mobile-friendliness.
• Off-page SEO – backlinks from other sites, social signals, Google Business Profile reviews.
• Technical SEO – site structure, secure (https) site, sitemap.

SEM (search engine marketing) is paid search advertising, e.g. Google Ads (pay-per-click).

3. Affiliate marketing – a business pays commission to affiliates (bloggers, influencers, coupon sites) for each sale or lead they bring through a special tracking link. Example: Amazon Associates. It is performance-based – pay only for results.

4. Content marketing – creating and sharing valuable, relevant content (blogs, videos, infographics, e-books, podcasts) to attract and retain a target audience, rather than directly selling. Example: a bank's YouTube videos on saving tax. It builds trust and supports SEO.

Other channels: social media marketing, e-mail marketing, influencer marketing, display advertising, video marketing.

Online Consumer: Concept, Influencing Factors and Latest Trends

An online consumer is a person who searches for information, compares and buys products or services through the internet.

Factors influencing online consumers: convenience; price and discounts; product range; reviews and ratings; trust and website security; payment options (UPI, cards, COD); delivery time and cost; easy return policy; user-friendly app; social influence; past experience.

Latest trends: quick-commerce (10-minute delivery); social commerce and live shopping; vernacular (regional-language) apps; voice search; buy-now-pay-later; AI chatbots and personalised recommendations; growth of shopping from smaller towns; ONDC network; sustainability-conscious buying.

Business Requirements for Online Consumers

1. User-friendly, mobile-responsive website/app with fast loading.
2. Secure payment gateway and multiple payment options.
3. Clear product information – photos, price, specifications, MRP as per legal metrology rules.
4. Reliable logistics – tracking, timely delivery.
5. Customer support – chat, phone, e-mail; grievance officer as required by the Consumer Protection (E-Commerce) Rules, 2020.
6. Easy returns and refunds.
7. Data protection and privacy policy.
8. Digital presence – SEO, social media, reviews management.
9. Personalisation and analytics to understand customers.

Likely exam questions

1. (Long, 8/16 marks) What is digital marketing? Distinguish it from traditional marketing and explain its opportunities and challenges.
2. (Long, 8/16 marks) Explain the digital marketing channels: mobile marketing, SEO, affiliate marketing and content marketing.
3. (Short, 4 marks) Who is an online consumer? State the factors influencing online consumers.
4. (Short, 4 marks) State the latest trends among online consumers.
5. (Short, 4 marks) What are the business requirements for serving online consumers?

Syllabus topics (RTMNU)

• Marketing Research - Types
• Process
• Tools and techniques
• Application of marketing research – product launching, demand estimation, advertising, brand preferences, customer satisfaction, retail stores image, customer perception, distribution, customer relationship, competitor analysis and related aspects

Meaning of Marketing Research

Marketing research is the systematic design, collection, analysis and reporting of data and findings relevant to a specific marketing situation facing the organisation.

Features: systematic and scientific; objective; based on facts; continuous; decision-oriented; covers all areas of marketing.

Marketing research vs market research: market research studies only the market (size, customers, competitors); marketing research is wider – it covers product, price, place, promotion and the market.

Types of Marketing Research

1. Exploratory research – to understand a problem when little is known; uses secondary data, expert interviews, focus groups.
2. Descriptive research – describes characteristics (who, what, when, where) – e.g. profile of buyers; uses surveys.
3. Causal (experimental) research – finds cause-and-effect, e.g. effect of a price cut on sales; uses experiments and test marketing.
4. By subject: product research, consumer research, advertising research, sales research, pricing research, distribution research, motivation research.
5. By data: qualitative (opinions, reasons) and quantitative (numbers, statistics).
6. Primary vs secondary research.

Process of Marketing Research

1. Define the problem and research objectives – e.g. "Why are sales falling in Vidarbha?"
2. Develop the research plan – type of research, data sources, methods, sampling plan, budget and time.
3. Collect data – secondary (company records, government reports, journals, websites) and primary (surveys, observation, experiments).
4. Analyse and interpret data – tabulation, percentages, averages, charts, statistical tests.
5. Prepare and present the report – findings, conclusions and recommendations.
6. Follow-up – check whether recommendations were used and with what result.

Tools and Techniques of Marketing Research

Data collection methods:

• Survey method – personal interviews, telephone, mail, online forms (Google Forms).
• Observation – watching shoppers, mystery shopping, store audits.
• Experimental method – test marketing in one city before national launch.
• Focus group – 6–10 people discuss a product with a moderator.
• Depth interviews and projective techniques – word association, sentence completion (used in motivation research).
• Panel research – same group studied over time.
• Online and social media analytics – web traffic, reviews, social listening.

Research instruments: questionnaire (open and closed questions, rating scales like the Likert scale), interview schedule, observation sheet.

Sampling: probability (random, stratified, cluster) and non-probability (convenience, judgement, quota) sampling.

Analysis tools: percentages, averages, cross-tabulation, correlation and regression, chi-square test; software such as Excel and SPSS.

Applications of Marketing Research

Importance: reduces risk in decisions; identifies opportunities; helps in planning the marketing mix; improves customer satisfaction; monitors performance; keeps the firm ahead of competitors.

Limitations: costly and time-consuming; respondents may give wrong answers; results can become outdated; it guides decisions but cannot guarantee success.

Likely exam questions

1. (Long, 8/16 marks) Define marketing research. Explain its types and the process of marketing research.
2. (Long, 8/16 marks) Explain the tools and techniques of marketing research and its applications in product launching, advertising and distribution.
3. (Short, 4 marks) Distinguish between marketing research and market research.
4. (Short, 4 marks) What is a focus group?
5. (Short, 4 marks) State the applications of marketing research in competitor analysis and brand preference.