Chapter -1

Introduction

 MARKETING
The concept of exchange leads to the concept of market .a market is the set
of actual and potential buyers of a products .these buyers share a particular need or
want that can be satisfied through exchange .thus, the size of a market depends on
the number of people who exhibit the need, have resources to engage in exchange,
and are willing to offer these resources in exchange for what they want.
Originally the term market stood for the place where buyers and sellers gathered
to exchange their goods, such as village squares. Economics use the term market to
refer to a collection of buyers and sellers who transport in a particular product
class, as in the housing market or the grain market.

Marketing
Exchange processes involve work. Seller must search for buyer, identify
their needs, design good products and service, set price for them promote them and
store and deliver them. Activities such as product development, research,
communication, distribution, pricing, and service are core marketing activities.
Although we normally think of marketing activities. Consumers do marketing

when they search for the goods they need a price they can offered. Company
purchasing agent do marketing when they track down seller and bargain for good
terms.

DEFINITION OF MARKETING
Marketing is concerned with the people and activities involved in the flow
of goods and services from producer to consumer.
-American marketing association
The purpose of business is to create a customer by which lays stress on two
aspects.
(a) Identification of consumer needs and
(b) Organizing the business to meet these needs
- Peter F. drucker

MARKETING MANAGEMENT
We define marketing management as the analysis, planning, implementation,
and control of programs designed to create, build, and maintain beneficial
exchange with target buyers for the purpose of achieving organization objectives,

thus, marketing management involves managing demand, which in turn involves

managing customer relationship.

MARKETING MIX
The set of controllable tactical marketing tools-product, price, place, and
promotion that the firm blends to produce the response it wants in the target
market. Once the company has decided to its overall competitive marketing
strategy, it is ready to begin planning the details of the marketing mix.
The marketing is one of the major concepts in modern marketing as the set
of controllable tactical marketing tools that the firm blends to produce the response
it wants in the market. The marketing mix consist of everything the firm can do it
influences the demand for its product. The many possibilities can be controlled into
four groups of variables known as the four Ps. Product, Price, Place,
Promotion.

PRODUCT:
Products mean the goods-and-service combination the company offers to
the target market. The product is the first element of the marketing mix. A product
is anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or need. Products include physical goods,

services, places, organization and ideas. Marketing oriented firms are able to
modify their products to bring about the greatest benefit. Designs, packaging,
convenience and warranty are all components of the complete products.

PRICE
Price is the amount of money customer has to pay to obtain the product.
Another

element of the marketing mix is price .or the perceived value of the

product must be affordable for the targeted customers, yet affordability varies from
buyer to buyer .an important correspondent of a complete program is the
companys policies regarding payment of offering credit. Price is the only element
of the marketing mix that produces revenue that other element quickly unlike
product features.
At the same time pricing & pure competition are the number one problems
facing many marketing executives? Companies handle pricing and variety of
ways. Ti is by a separate dimension or may even be safety marketing or sales
people.

PLACE

Place includes company activities that make the product available to target
customers. it is where and when satisfaction that consumer and users requires. It
makes little difference how attractive or functional the product might be if is not
available when needed. The company must identify, recruit and like various
middleman and marketing facilities so that its products and services are efficiently
supplied to the target market. It must understand the various types of retailers,
wholesalers and physical distribution firms and how they make their decisions.

PROMOTION
Promotion means that communicate the merits of the products and persuade
target customers to buy it .promotion, the fourth marketing mix tool, stands for the
various activities the company undertake to communicate and promote its products
to the target market. The glamour and sheer volume of advertising make promotion
mare evidence than the other elements. Promotion is the vehicle marketers use to
inform, remind or persuade potential buyer.
This element of the marketing mix can be powerful and influenced force in
determining consumer preference .An effective marketing program blends all of
the marketing mix elements into a co-ordinate program designed to achieve the
companys marketing objectives by delivering value to consumer. The marketing
mix constitutes the companys tactical tool to kit for establishing the four Ps

represent the sellers view of the each marketing tools available for influencing
buyers. From a consumers view point, each marketing tool is designed to deliver a
customer benefit. One marketing expert suggests that companies should view the
four Ps in terms of the customers four CS

Customer needs and wants.

Cost to the customer
Convenience.
Communication.

CONSUMER ATTITUDE
All business firms have realized that marketing is a core element of
management philosophy and the key to its success lies in focusing more on the
customer .that is, it will be the customer who will decide where the firm is heading.
Thus the challenge before the market is to ensure that they satisfy every customer.
Adam smith in his, the wealth of nation, has said
Consumption is the sole end and purpose of all production and the interests of the
products ought to be attended to only so far as it may be necessary for promoting
that consumer
This quotation only reiterates that the purpose is consumption and ones own
purpose will be served only if the consumers interests are attended to. Here then
arises a very vital question. How can a market ensure that his or her firm is able to

respond to their customers requirement quickly? The answer to his lies in quality
of service it is offering to its customers. This again will depend upon the customer
expectation from the product or service.

Factors influencing consumer attitude :

The major factors influencing consumer behavior are

CULTURAAL FACTORS :
Cultural factors exert the broadest and deepest influence on consumer
behavior .It includes:
1. Culture
2. Subculture

SOCIAL FACTORS :

1.Family
2.Reference group
3.Social class and caste
4.Status

PERSONAL FACTOR:
Personal chacteristics include characteristic such as the buyers
a.Age and stage in the life cycle
b. Occupation
c.Economic circumstances Life style

PSYCHOLOGICAL FACTORS:
a. MOTIVATION
b. Perception
c. Learning
d. Personality

e. Belief and attitude

GSM Market in India

Regional Interest Groups - GSM India
With a population of around 1.3 billion growing at roughly 1.9 per
cent a year, India is potentially one of the most exciting GSM markets in the world.
India's telecommunications have undergone a steady liberalisation since 1994
when the Indian government first sought private investment in the sector. More
significant liberalisation followed in 1996 with the licensing of new local fixed line
and mobile service providers. However, it has been the government's New Telecom
Policy (1999) that has had the most radical impact on the development of GSM
services. 'The policy's mission statement is 'affordable communications for all;
There is a genuine commitment to creating a modern and efficient communications
infrastructure that takes account of the convergence of telecom, IT and media. In
addition, the policy places significant emphasis on greater competition for both
fixed and mobile services.' Competition in the mobile sector has already had a
visible impact on prices with calls currently costing less than 9 cents per minute.
This means that service costs have fallen by 60 per cent since the first GSM

networks became live in 1995. It also helps explain why a recent Telecom Asia
survey revealed that more than 70 per cent of Indian mobile subscribers felt that
prices were now at a reasonable level.
One of the challenges facing GSM operators in India is the diversity of the
coverage regions -from remote rural regions to some of the most densely populated
metropolitan areas in the world. India has more than 40 networks, which cover the
seven largest cities, over 7000 towns and several Lacs villages. Such depth of
coverage has required enormous investment from India's operators. It is estimated
that more than Rs200 billion had been invested in India's GSM industry by mid2000, a figure that is set to be supplemented by a further Rs. 300 billion over the
next five years.
The good news is that subscriber growth is beginning to look healthy. With Indias
low PC penetration and high average Internet usage -at 14-20 hours a month per
user it is comparable to the US -the market for mobile data and m-commerce looks
extremely promising. WAP services have already been launched in the
subcontinent and the first GPRS networks are in the process of being rolled out. In
the year ahead, GSM India will work with its members to realise the potential of
early packet services in anticipation of the award of 3GSM licences.

India fastest growing GSM market

The Cellular Operators Association of India (which includes most of

Indias GSM telecom operators), has reported an addition of 3.50 million GSM
connections in April 2013, closing in at 664.4 million subscribers, a 0.53%
increase from 660.9 million subscribers in the previous month. Globally, the GSM
market reached 3.9 billion users in February 2013, adding GSM accounted for 80
per cent of the new subscriber growth in 2012."Almost every Latin American
operator has chosen GSM. In North America GSM growth is bigger than CDMA
(code division multiple access)," he said. Commenting on the raging debate over
GSM versus CDMA in mobile services arena, Hadden said: "GSM is the world's
most successful mobile standard with over 2 billion users, and is an open mobile
standard. It also supports automatic international roaming, which is a major
contributor to business plans."
Indias private telecoms firms offering GSM-based mobile services
reported a 21 percent rise in revenue in the year to March 2012 but said future
growth rates could slow because of heavy taxes on the nascent industry. Although
Indias mobile sector is the worlds fastest growing major wireless market, it is
amongst the highest taxed industries in the country. Mobile carriers pay as much as
25 percent of their revenue as licence fee, spectrum charges and other taxes. The
Cellular Operators Association of India (COAI) said revenue for fiscal 2003/04
stood at 83.08 billion rupees ($1.86 billion) compared with 64 billion rupees a year

earlier. According to T.V. Ramachandran, director general at COAI, These

revenue growth rates cannot be maintained unless there is a concerted effort by the
government to cut excessive levies and allow sharing of infrastructure. But the
potential to do much better exists as there is still huge demand in the sector.
Ramachandran said the sector was still losing money but declined to elaborate.
Sales jumped because of a doubling of the GSM (Global System of Mobile
Communications ) user base

as more people entered the flourishing market

thanks to one of the lowest call rates in the world. But the monthly average
revenue per user, a key measure of profitability, declined 17.4 percent to 432
rupees in the fourth quarter compared with 523 rupees in the first quarter due to a
cut in tariffs and excessive competition among companies.

Growth slowing,

demand untapped: The association has not included the financial performance and
the GSM-user base of state-run firms Bharat Sanchar Nigam Ltd, the secondranked player, and Mahanagar Telephone Nigam Ltd, Ramachandran said. There
are 650 million GSM customers and more than 96 million users of the rival
CDMA-based mobile services in the country.
The pace of growth in monthly additions is increasing after just 8.25 million users
took up the service in April compared with 6.9 million in the previous month.
Ramachandran blamed the slowdown on a majority of small GSM operators being

unable to expand networks into rural swathes where demand remained largely
untapped.
Our surpluses are not enough to cover costs of network expansion and financing
charges on loans. We are making money only to cover operating expenses, he
said. Carriers are now subsidising handset costs to woo users into the
underpenetrated industry forecast to have more than 750 million customers by
2014.