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Business Ethics

Team submission on "Ethics in Marketplace". Course: Business ethics.

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Business Ethics

  2. 2. AGENDA Packaging, Labelling & Product launch 01 Government Regulation 03 Pricing Strategies 05 Pricing Objectives 02 Brand Management 04
  3. 3. What is Marketing Marketing is the science and art of exploring, creating, and delivering value to satisfy the needs of a target market at a profit. The activities of a company associated with buying and selling a product or service. It includes advertising, selling and delivering products to people. Why is Marketing required 4P’s • Finding the Target audience for the product • To differentiate your product from competitors • To set competitive pricing • The most effective promotion techniques • To form strategies to compete in the market INTRODUCTION
  4. 4. Packaging is anything used to contain, protect, handle, deliver or present raw materials and processed goods. Container : It is a physical necessity that most contents need a suitable container. Physical Protection : Physical protection from shock, vibration, temperature Agglomeration : Small packets are packed in bulk Portion control : The immediate container of the product is a natural vessel for the quantity Packaging
  5. 5. Labelling • Display of information about a product on its container, packaging, or the product itself. Logical information • Immediate communication about what is contained in the package • Products with chemicals, foodstuffs and Pharmaceuticals need extra guild lines Marketing • It directly communicates what customer wants • Maintains customers relationship Packaging & Labelling
  6. 6. Launching a Product. Mantra of 3 Major FMCG companies • Dabar : Widen Market share and increase investment • Marico : Brand Building • ITC Ltd. Introduce as many new products as possible Things required to do before Launching a product. • Market Research • Communication • Visibility • Strategy for execution Product launch
  7. 7. Pricing Strategies - Penetration pricing strategy – Considerable discounts/ freebies, sudden withdrawal , price war, unfair comparisons, imperceptible volume reductions
  8. 8. Pricing Strategies - Price skimming – gradually reducing prices for same product, wiping out competitions & achieve monopoly in the market - Competitive pricing- watchful, dynamic prices, shadow pricing, lower prices to wipe out others
  9. 9. Pricing Strategies - Price shading –distributors given a free hand on discounts , constant escalation may cause glut in the market, if sales goes down profit will b e hit badly - Seasonal pricing-Lesser price at end of season, seasons clearance very often an excuse to clear inventory - Term pricing- Discounts to those who pay in full, large industrial buyers benefit from this - Segment pricing-Discounts /freebies for a particular segment, deceptive tactic - Volume pricing- larger the volume greater the discount, creating demand wont be beneficial on the long run
  10. 10. Pricing - Free market – marketers lower price to raise demand, higher prices higher the supply & lower demand, equilibrium is achieved after some time - Ethically ideal situation is when both parties are happy & ethical behavior is ensured from both ends - Monopoly market –Extremely unethical because they violate the fundamentals of free market, here illegal control of supply forces & pricing
  11. 11. Role of Government • Government plays an important role in encouraging businesses to behave in an ethical manner. • Its control is important to have a control on the monopoly market. • In poor and developing countries its role is very crucial • Example – India, rationing of food grains and other essentials
  12. 12. Protecting the economy • Having control measures like price control by fixing base price or floor price to protect farmers Protecting the consumers • Measures like price ceiling to protect tenants Ethical problems • Problems related to human freedom • Curtailing the entrepreneurial freedom of people • People depend on government for everything which harmed the self esteem of the people • What ever role government plays it should be for the benefit of the people
  13. 13. Brand Management • Brand is the identity of a company • A company is responsible for the goods and services it produces under the brand name • Brand has a character shaped by the company internally • It is recognized by the consumers externally • Brands that connect ethically to society earn reputation
  14. 14. Deterrence: • Refers to any action taken by an existing business • discourages potential entrants from entering into competition in that market • barriers to entry • product differentiation through heavy spending on new product development, capacity expansion to achieve lower unit costs, and predatory pricing. • Virgin Atlantic v British Airways Pre-emptive Strike: Frontal Attack • Gather as many customers as possible • Leaving a blazing trail that keeps competitors away • Customers may dislike too much intrusion in personal life Pricing Strategies
  15. 15. Flanking: • To tap the untapped are or in which competitors are less interested. • Blue ocean • Good space to nurture a new entrant • Might go unnoticed. Sequential Strategies: • This is about the people who has ample amount of experience in the field. • Well thought out and long term plans • Detailed plan and policies • Demerit is that they might be bogged down by the bureaucratic process. Alliances: • When companies feel that they are being part of undue competition • Might provide better product an services and not merely look after acquiring customers • Lead to Monopoly • E commerce companies mutually decided to cut down on coupon discounts. Pricing Strategies
  16. 16. Counter Offensive marketing strategies : • Are used to secure competitive advantages; • Market leaders, runner-ups or struggling competitors are usually attacked • Keeps the company at toes • Might loose out more because of hyperactive digital media. Mobile defense: • Company keeps the product mix flexible • Allows innovation and repositioning of its products. • Might loose stability Encirclement: • Long term strategy, surrounds competitor slowly • Might miss the bigger picture and be bogged down Pricing Strategies
  17. 17. Strategic withdrawal: • Defensive tactic • Foresight of an economic down turn • Competitors might get n upper hand. Leapfrogging: • Innovate strategy coupled with the new technology ; leave competitors behind with the primitive style of business. • May not be appreciated by customers. Pricing Strategies
  18. 18. Pricing - Most important among 4Ps – Crucial role in free market economies - Pricing Objectives - Competitive pricing – Follow the leader & differentiate using other characteristics like quality , strategies adopted to be different should be fair - Prestige pricing- To enhance reputation for up-market areas through limited supplies, products will not be value for money - Profitability pricing – maximize revenues through fair price & high volumes , ways to maximize revenue should be fair - Volume pricing- Lowest pricing for max. sales, difficult for small players to survive
  19. 19. Creation of Consumer capacity • General assumption is that people have money or people with money are the customers. • Fortune is at the bottom of the pyramid. • In social marketing assumption is that consumer have very less money Strategy for them: Innovative product and services Affordability Partners in business Supportive relationship Empowerment and dignity Availability Access Unusual Strategy: Integral marketing paradigm
  20. 20. Affordability Vs Access Availability Innovative product and services Local Branded