IM Porject

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Q b

Process of New Product Development

Developing a new product shouldn’t feel like you’re fighting in the dark. There’s an easier way.

What you need is a structured road-map that gives your business a clear path to follow.

Actually developing the tangible product or service is only a small part of the new product

development process, which includes the complete journey from generating the initial idea to

bringing the product to market.

By setting out the steps involved, and sticking to them, your product development will become a

more focused and flexible approach that can be adapted for all different types of products and

services.

1.Idea Generation

The development of a product will start with the concept. The rest of the process will ensure that

ideas are tested for their viability, so in the beginning all ideas are good ideas (To a certain

extent!)

Ideas can, and will come, from many different directions. The best place to start is with a SWOT

analysis, (Strengths, Weaknesses, Opportunities and Threats), which incorporates current

market trends. This can be used to analyse your company’s position and find a direction that is in

line with your business strategy.

In addition to this business-centred activity, are methods that focus on the customer’s needs and

wants. This could be:

• Under-taking market research

• Listening to suggestions from your target audience – including feedback on your current

products’ strengths and weaknesses.

• Encouraging suggestions from employees and partners

• Looking at your competitor’s successes and failures

#2.Idea Screening

This step is crucial to ensure that unsuitable ideas, for whatever reason, are rejected as soon as

possible. Ideas need to be considered objectively, ideally by a group or committee.

Specific screening criteria need to be set for this stage, looking at ROI, affordability and market

potential. These questions need to be considered carefully, to avoid product failure after

considerable investment down the line.

3.Concept Development & Testing

http://www.cambridgemr.com/Expertise/NewProductDevelopment/IdeaGeneration/https://www.boundless.com/marketing/products/new-product-development--2/screening--2/http://mnav.com/focus-group-center/concept-testing/https://www.boundless.com/marketing/products/new-product-development--2/screening--2/http://mnav.com/focus-group-center/concept-testing/http://www.cambridgemr.com/Expertise/NewProductDevelopment/IdeaGeneration/


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You have an idea and it’s passed the screening stage. However, internal opinion isn’t the most

important. You need to ask the people that matter – your customers.

Using a small group of your true customer base – those that convert – the idea need to be tested

to see their reaction. The idea should now be a concept, with enough in-depth information that

the consumer can visualise it.

Do they understand the concept?

Do they want or need it?

This stage gives you a chance to develop the concept further, considering their feedback, but

also to start thinking about what your marketing message will be.

4.Business Analysis

Once the concept has been tested and finalised, a business case needs to be put together to

assess whether the new product/service will be profitable. This should include a detailed

marketing strategy, highlighting the target market, product positioning and the marketing mix that

will be used.

This analysis needs to include: whether there is a demand for the product, a full appraisal of the

costs, competition and identification of a break-even point.

#5.Product Development

If the new product is approved, it will be passed to the technical and marketing development

stage. This is when a prototype or a limited production model will be created. This means you

can investigate exact design & specifications and any manufacturing methods, but also givessomething tangible for consumer testing, for feedback on specifics like look, feel and packaging

for example.

#6.Test Marketing

Test marketing (or market testing) is different to concept or consumer testing, in that it introduces

the prototype product following the proposed marketing plan as whole rather than individual

elements.

This process is required to validate the whole concept and is used for further refinement of all

elements, from product to marketing message.

#7.Commercialisation

When the concept has been developed and tested, final decisions need to be made to move the

product to its launch into the market. Pricing and marketing plans need to be finalised and the

sales teams and distribution briefed, so that the product and company is ready for the final stage.

#8.Launch

A detailed launch plan is needed for this stage to run smoothly and to have maximum impact. It

should include decisions surrounding when and where to launch to target your primary consumer

http://www.strategyconsultinglimited.co.uk/marketing-and-advertising/new-product-development/http://hbr.org/2012/05/six-myths-of-product-development/http://smallbusiness.chron.com/three-major-disadvantages-test-marketing-20409.htmlhttps://www.innovateuk.org/documents/1524978/2138994/Concept+to+Commercialisation+-+A+Strategy+for+Business+Innovation+2011-2015/f9debf80-dd43-4284-be56-a11a3dda25a8http://businesscasestudies.co.uk/cadbury-schweppes/launching-a-new-product-into-a-developed-market/the-launch-strategy.htmlhttp://www.strategyconsultinglimited.co.uk/marketing-and-advertising/new-product-development/http://hbr.org/2012/05/six-myths-of-product-development/http://smallbusiness.chron.com/three-major-disadvantages-test-marketing-20409.htmlhttps://www.innovateuk.org/documents/1524978/2138994/Concept+to+Commercialisation+-+A+Strategy+for+Business+Innovation+2011-2015/f9debf80-dd43-4284-be56-a11a3dda25a8http://businesscasestudies.co.uk/cadbury-schweppes/launching-a-new-product-into-a-developed-market/the-launch-strategy.html


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group. Finally in order to learn from any mistakes made, a review of the market performance is

needed to access the success of the project.

New product development can be made much simpler and focused, with a higher likelihood of

success, by following these steps to guide you.

Q c

How can we define Packaging?

Kotler defines packaging as "all the activities of designing and producing the container

for a product." Packaging can be defined as the wrapping material around a consumeritem that serves to contain, identify, describe, protect, display, promote, and otherwisemake the product marketable and keep it clean. Packaging is the outer wrapping of aproduct. It is the intended purpose of the packaging to make a product readily sellable

as well as to protect it against damage and prevent it from deterioration while storing.Furthermore the packaging is often the most relevant element of a trademark and

conduces to advertising or communication.

Functional Requirements

1. Protection and preservation

A basic function of package is to protect and preserve the contents during transit fromthe manufacturer to the ultimate consumer. It is the protection during transport and

distribution From climatic effects !heat and cold, moisture, vapour, dryingatmospheres from ha#ardous substances and contaminants and from infestation.

Protection is re$uired against transportation ha#ards spillage, dirt, ingress and egress ofmoisture, insect infection, contamination by foreign material, tampering pilferage etc. Apackage should preserve the contents in %Factory Fresh% condition during the period ofstorage and transportation, ensuring protection from bacteriological attacks, chemicalreaction etc.

2. Containment

&ost products must be contained before they can be moved from one place to another.'o function successfully, the package must contain the product. 'his containmentfunction of packaging makes a huge contribution to protecting the environment. A better

packaging help to maintain the $uality of the product and reachability of the product inthe consumer%s hand without spillages It gives better image to the organisation.

3. Communication

A ma(or function of packaging is the communication of the product. A package mustcommunicate what it sells. )hen international trade is involved and different languages

are spoken, the use of unambiguous, readily understood symbols on the distributionpackage is essential. It is the interest further that to get appropriate communication to

the consumer about the product, how to use it and other utility informations. Packagingprotects the interests of consumers. Information includes* $uantity price inventory


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levels lot number distribution routes si#e elapsed time since packaging colour andmerchandising and premium data.

!pes of packaging

An important distinction is to be made here between two types of packaging

o ransport packing" 'he product entering in to the trade need to be packed well

enough to protect against loss damage during handling, transport and storage. +g*fiberboard, wooden crate etc.

o Consumer Packing" 'his packaging holds the re$uired volume of the product forultimate consumption and is more relevant in marketing. +g* beverages, tobacco etc.

Ha#ards of ransport

'here are four main ha#ards of transport

-rops and impacts ompression forces

/ibration limatic variations

$arious %ec&anical ests

o 'rop est" 'his test help to measure the ability of the container and inside packingmaterials to provide protection to its contents and to measure the ability of the containerto withstand rough handling.

o $i(ration est" 'his test is to determine the ability of the container to withstand

vibration and the protection offered by materials used for interior packing.

o Compression est" 'his test is carried out, generally, on empty containers, tomeasure the ability of the container to resists e0ternal compressive loads applied tofaces or applied to diagonally opposite edges or corners.

o )nclined )mpact est" 'his test help to study the e0tend of damage in a way ofcrushing, breaking, cracking, distortion, and shifting during handling storage and

transport which occurs to the container and its content.

o Rolling est" 'his test helps to evaluate the overall strength of the container and thecushioning material provided inside and any failure of the content.

o 'rum test" 'his test help to evaluate loaded shipping containers with respect togeneral overall durability and for the protection afforded to the contents against certainha#ards of handling and shipment.

$arious Climatic ests

o Rain est" 'his test is conducted in a simulated rain condition to assess its impact onthe test area for two hours.

o *and and 'ust est" 'his test is to evaluate the resistance of a package to thepenetration of sand and dust.

o *alt *pra! est" 'his test is to evaluate the resistance of a package to corrosion by


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salt spray and to serve as a general standard for corrosion.

o Fungus Resistance est" 'his test is to evaluate all the materials used in thefabrication of shipping containers for fungus resistance.

)mportance of Cus&ion %aterials

ushioning is that part of packaging, which protects the article from damage due to

shock and vibration. 'he main functions of cushioning materials can be detailed asfollows*

o 1hock protection against vibration

o Protection against abrasion

o Protection of grease proof and water proof barriers at ponut of contact with solid blocks

o Protection of moisture vapour barriers at points of contact with sharp edges of the

article itself.

o Protection of small pro(ections

o Filling of void space in the container

o 2ther secondary purposes

Packaging Cost

'he most important aspect when we look into packaging is the packaging cost.Packaging cost include the following*

%aterial cost" It means the cost of the pack and $uality control cost.

*torage and &andling cost of empt! packages" 'his include the handling cost ofbulky packages, heavy materials of construction, drums etc.

Packaging operation costs" 'his includes the cost involved in operations like,cleaning the package product filling 3 closing, labeling 3 uniti#ing, stenciling, handling

cylindrical slums etc.

*torage of filled packages" 'his includes the cost incurred to shift the goods fromone form of packaging to another.

ransportation cost of filled packages" 'his involves the transportation cost bysea, air etc. !freight by volume

+oss and 'amage cost" It is related to the loss and damage during operation,transportation delivery etc.

)nsurance cost" It varies depending on the vulnerability of package

,ffect of packages on sales" 'he package that influence on sales.

-(solescence Cost" 'his cost involves when changes in the packaging materials,

packages and labels happen.


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Package developmental cost" 'his include the evaluation cost, pilot test cost, fieldtesting cost, consumer research cost, feed back cost, final trial cost etc.

)mportance of packaging" n -verview

1ome of the ma(or significance of packaging can be detailed as follows*

an make a product more convenient to use or store, easier to identify or promote or

to send out a message.

an make the important difference to a marketing strategy by meeting customers%needs better.

Packaging plays a key role in brand promotion and management. Packaging is of greatimportance in the final choice the consumer will make, because it directly involvesconvenience, appeal, information and branding.

'he paramount concern of packaging is the reachability of the product without any

damage. 4o matter where and how the products are transported or shipped, they arriveat the customer%s door in working condition without need of repair or ad(ustment.

Packaging is especially important in certain industry where future sales may be basedlargely on the $uality, integrity and performance of a company%s previous delivery.

Conclusion

'he significance of packaging has come to be increasingly recogni#ed in e0port as well asin marketing of a wide range of consumer goods and industrial products within the

country. 'he volume of e0ports depends not only on the $uantity of the production andprices, but also to a substantial e0tends on the standards of packaging adopted for the

products. 5oods damaged in transit or arriving at the destination in an unacceptablecondition tarnishes the reputation of the manufacturer as well as the country as a whole,besides colossal wastage of scarce economic resources. Further, packaging has a crucialrole to play in the fetching higher unit values for our consumer goods !like tea andcashew through the substitution of the bulk packs by consumer packs. In the recentpast packaging has been increasingly recogni#ed as a significant factor in the nationse0port promotion effort. +ffort should be there to understand the importance ofpackaging there by to avoid the loss and damage cost incurred during transport and

delivery. Keep in mind that a conscious effort on the part of marketing managers canincrease the volume of sales and there by improve the reputation of the product and

organisation.


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Q e

PRICING STRATEGIES Price is the amount of money charged for a product or

service. Price product ! service ! pro"t ! image. Price #i$$ inc$ude the cost of

producing your product% the cost of providing any needed services that may

accompany the product% the amount of pro"t that you need to ma&e in order to

stay in 'usiness. (ften the "rm is trying to portray the 'est )ua$ity or the $o#est

price. Therefore% price can 'e a direct re*ection of )ua$ity or even perceived

)ua$ity. There are severa$ 'asic pricing strategies considered #hen ma&ing

decisions for e+port,

Economy and Premium Premium pricing is adopted #hen there is a su'stantia$

competitive advantage% and the product or service is uni)ue -Concord *ights%

and economy pricing strategy #hen the cost of mar&eting and manufacture is

&ept at a minimum.

Penetration or /o# Price This "rst mode$ uses a $o# pro"t margin to penetrate

the mar&et. It is designed to gra' mar&et share )uic&$y. Penetrating the mar&et

#ith an e+ceptiona$$y $o#0priced item creates a 'road customer 'ase. It a$so

provides highva$ue0for0the0do$$ar to the customer. Penetration is used #hen

prices are set "rst $o# in order to attract ne# customers and to gain mar&et

share% and then the price is increased after the mar&et share has 'een achieved. To penetrate the mar&et and gain mar&et share% 'usinesses set a $o# price in

comparison to other competitors. Note that a$so $o# price is sometimes

perceived as indication of $o# )ua$ity product. It may a$so 'e di1cu$t to increase

price in the future #ithout incurring $oss.

S&imming This is appropriate for some product to 'e priced as high as the

mar&et #i$$ 'ear. 2o#ever% fe# 'uyers are attracted% and $o#er sa$es vo$umes

can 'e achieved #hen price is such high. This strategy is often used #hen a ne#

product is introduced into the mar&et% and is in great demand. 3or this strategy%

the product or service is charged high 'ecause of a su'stantia$ competitiveadvantage. This high price tend to attract ne# customers into the mar&et% and

then fa$$s due to $o#er unit cost as economies of sca$e are achieved. S&imming is

the opposite of penetration and is a high priced mode$% sometimes ca$$ed 4top

pricing.4 The idea 'ehind this pricing strategy is to return high pro"ts% even at

the cost of $osing a $arge num'er of customers. Typica$$y% #hen a company

$aunches a ne# product% they charge higher prices in the 'eginning to he$p

recoup R56 e+penditures as fast as possi'$e. To 'e successfu$% "rms must have a

uni)ue product that7s in demand. 3or e+amp$e% 8chip manufacturers9 often use

this methodo$ogy during the introductory phase of a ne# proprietary product.

Another mode$ that c$ose$y resem'$es 4s&imming the cream%4 is the high cost

option ca$$ed 8prestige pricing.9 Companies $i&e :ercedes0;en< or ;:= are good


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e+amp$es of this mode$. Customers purchase products from them &no#ing they

pro'a'$y paid too much. ;ut% these companies have the prestigious reputation of

high )ua$ity products and customer service.

Competitor>s Pricing To attract the $argest num'er of customers and generate

consistent turnover% it may 'e necessary to set price not too high% not too $o#% ?ust in the midd$e in $ine #ith other competitors. Prices are tagged to the

competition and pro"ts are accepta'$e. 8In the $ong run% no sing$e pricing

strategy #i$$ a$#ays #or& 'est% and producers shou$d 'e prepared to ad?ust to

any opportunities or dangers #hich arise in the ever0changing mar&et.9 3or

e+port pricing% e+porters shou$d consider other factors such as freight and

transport% duties% and ris&s.

Even though premium pricing% penetration pricing% economy pricing% and price

s&imming are the main pricing strategies for mar&eting mi+% there are other

strategies to pricing such as, psycho$ogica$ pricing% product $ine and optiona$

product pricing% captive and product 'und$e pricing% promotiona$% geographica$%

va$ue pricing% rigid and *e+i'$e cost0p$us strategy% dynamic increment% margina$

cost% and $oss $eader pricing strategies.

Rigid Cost0P$us Strategy In order to ma&e pro"ts% managers adopt rigid cost0p$us

pricing strategy. This is accomp$ished 'y adding internationa$ customer costs and

a gross margin to domestic manufacturing costs. 2ence% the cost to the

customer inc$udes administrative and R56 costs% transportation% pac&aging%

insurance% and other mar&eting e+penses. Cost0p$us pricing strategy appears to

'e the most dominant strategy among Americans "rms -Cavusgi$ @BB.

3$e+i'$e Cost0p$us Strategy 3$e+i'$e strategy a$$o#s price variations depending on

circumstances. 3or e+amp$e there may 'e some discounts depending on the

customer% the order% or competitive factors. This strategy is often used to

encounter competitive pressures or e+change rate *uctuations.

6ynamic Incrementa$ Strategy The strategy assumes that "+ed and varia'$e

domestic costs are incurred regard$ess of e+port sa$es. In this strategy% some

domestic costs such as, R56% domestic promotion and mar&eting costs% are

disregarded. The dynamic incrementa$ strategy a$so assumes that there #i$$ 'e

a$#ays unused capacity or e+cess supp$y% and therefore e+ported products

cannot 'e so$d at fu$$ cost. This he$ps companies to enter% penetrate and

compete in internationa$ mar&ets.

Qe part


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Po$icy Environment 3or mar&eters considering an entry strategy into a foreign

country or region% a num'er of environmenta$ factors shou$d 'e used to assess

mar&et opportunities and constraints. Cu$tura$ and structura$ issues are

common$y eva$uated as a "rst step in the mar&et e+pansion process.

Environmenta$ monitoring shou$d continue throughout the 'usiness cyc$e. In $ight

of mu$ti$atera$ trade agreements and other economic and po$icy integrations%

mar&eters must a$so 'ecome adept at eva$uating country standards% mu$ti$atera$

standards% and their interaction eDects. Since mar&eters must comp$y #ith the

$a#% an understanding of governmenta$ po$icy and the process 'y #hich it is

created is centra$ to eDective mar&eting decision0ma&ing. To operate%

internationa$ "rms must understand the po$icy0ma&ing process and diDerent

categories of $a#s% and mar&eters must a$so investigate the genera$ po$icy

c$imate and $oca$ $a#s that aDect the operation of their 'usiness. In deve$oping

mar&eting and 'usiness o'?ectives% decision0ma&ers can unintentiona$$y create

incentives and pressures that run counter to $ega$ and ethica$ standards.

A$though not a$#ays conceptua$i


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:ar&eters a$#ays #atch not on$y the present economic prosperity of a country%

'ut a$so its future deve$opment in terms of popu$ation and density% in*ation and

economic gro#th% age and distri'ution of income% $eve$ of ur'anis costs% determines demand potentia$ for a particu$ar

productHservice% in addition to the prices that $oca$ customers can aDord and are

#i$$ing to pay -=hite$oc& and Pim'$ett @. 3or e+amp$e% some products that

are considered essentia$ in #estern countries% are vie#ed as $u+ury items in my

country -R#anda% and most of the su'Saharan African countries. This con"rms

the hypothesis that the demand for a productHservice at diDerent price $eve$s is a

function of the purchasing po#er of targeted customers% determined 'y the $eve$

of economic deve$opment of the country -Jain @B.

Socia$ 3actors Peop$e from diDerent cu$tures have diDerent tastes% 'uy diDerent

products and respond in diDerent #ays to the same service or product.

Therefore% the demographic structure of a foreign mar&et shou$d 'e considered.

The aging of popu$ation in ma?or #estern mar&ets% and the increase in popu$ation

in severa$ countries such as India and China% is another continuing deve$opment

that #i$$ aDect internationa$ mar&eting. As teens around the #or$d are 'ecoming

a g$o'a$ mar&et segment today% and su'0Saharan Africa is 'ecoming part of

g$o'a$ mar&et% the mar&eting strategies mi+% inc$uding internationa$ and e+port

pricing #i$$ have to adapt to socia$ factors. That is #hen pricing for internationa$

mar&ets% one has to ta&e into consideration of $oca$ materia$ cu$ture% $anguage%

aesthetics% education and re$igion% as #e$$ as attitudes and va$ues. 3irms need to

e+amine carefu$$y target mar&et country>s characteristics and purchasing

'ehaviors% to se$ect appropriate pricing strategy. Price $eve$ is an important

criteria used 'y consumers in eva$uating competing products. (ther criteria such

as product )ua$ity and performance are important to customers -6oug$ass and

=ind @B. Thus% in deve$oping pricing strategy% "rms must 'e a#are of foreign

consumers> preferences% perceptions% and purchasing 'ehaviors #ith respect to

various price $eve$s -Theodosiou% .

Techno$ogica$ 3actors 3irms need to ana$ys needs. Internationa$ "rms often re$y on

e+isting $oca$ distri'ution infrastructure in order to transport and distri'ute their

products to consumers. This may have signi"cant eDect on costs% and in turn

may in*uence price% as #e$$ as pro"ts. Techno$ogy change is another dynamic

'ut ongoing phenomenon. A perfect e+amp$e is the internet. Internet a$$o#s

on$ine contact #ith the "rm7s customers% supp$iers% and partners and su'sidiaries

around the #or$d% 'ut it may a$so increases the opportunities for e+isting

competitors and openings for ne# competitors. Therefore% techno$ogy provides

'oth opportunities and cha$$enges. Pricing is a strategic choice% and it #i$$ 'e


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partia$$y in*uenced 'y environmenta$ factors. Ta&ing into account e$ements of

cost% the 'ehaviora$ assumptions of se$f0interest $ead "rms to ta&e advantage

#hen environmenta$ forces *uctuate -=i$$iamson% @K. 2o#ever% some

environmenta$ factors% such as, economic and regu$atory vo$ati$ity% and

competitive intensity% have 'een identi"ed as moderating eDects 'et#een

strategy and performance -Cavusgi$ and Lou% @M :yers @.

:odu$e

Qa

Generally, the ways you can market your products or services can be sorted into two distinct

categories: direct and indirect. Direct marketing involves any marketing strategy that targets a

demographic for the purpose of making a sale at that time. Indirect marketing refers to marketing

strategies that aim to establish a business as an expert in its field and build a following that will

convert to sales over time. Both have advantages and disadvantages.

Advantages of Direct Marketing

Direct marketing strategies make the desired sale obvious to the customer. xamples of direct

marketing include mailers, telemarketing calls and coupons. !ince the sales pitch is obvious to

consumers, one of the advantages of direct marketing is that it typically works "uickly. #hat is,

you either get the sale or your don$t at the time of the marketing pitch. #his also makes these

techni"ues highly measurable, another advantage to direct marketing.

Disadvantages of Direct Marketing

In light of how immediate the payoff is for effective direct marketing, the mediums used for direct

marketing can be more expensive than those for indirect marketing. #elevision ads, large%scale

direct mailings and contracting telemarketers can be costly, particularly for smaller businesses

that haven$t done extensive market research before launching a campaign. &urthermore,

consumers may perceive heavy%handed direct marketing as too pushy, turning them off to your

company.

Advantages of Indirect Marketing

Indirect marketing refers to marketing strategies that offer potential customers benefits outside of

the product or service your company is offering, such as entertainment or expertise in your field.

xamples of indirect marketing include blogging and social media. 'ne advantage to this

techni"ue is that potential customers are invited to engage at the level they feel comfortable, so

you can avoid hard%selling tactics. #hese techni"ues also tend to be inexpensive.


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Disadvantages of Indirect Marketing

Because indirect marketing relies on building relationships and trust, these marketing strategies

can take a long time to start working. (nother disadvantage to indirect marketing is that it can be

difficult to measure. &or example, you could measure the number of #witter followers your

company has, but that doesn$t necessarily translate into sales. &inally, indirect marketing

techni"ues rely heavily on content generation and creativity, something your company may not

have the resources to handle.

Direct marketing, like television commercials and maga)ine ads, allow you

to specifically target a demographic with a sales pitch built especially for

them. But where do we get the information we need to build thesemarketing campaigns* It used to be that companies would spend a large

sum of money on market research, which not too long ago used to be

conducted most often on the phone, or in person.

#hat should no longer be the case today, with the expansion of our

information providing technologies, namely the Internet. With the advent

of the personal computer and easily accessible Internet capabilities,

market research no longer takes an exorbitant amount of money! (ll of the information that you seek all lives within the ease of the click of a

button.

+ust because traditional marketing has spawned the creation of indirect

marketing tactics does not mean that they can not be used in conunction

with each other. In fact, combining these two techni"ues can provide

valuable information that you-ve garnered from indirect techni"ues for use

in your direct campaigns later on.

What Direct Marketing Can Do For You

Direct marketing, as mentioned earlier, includes things like television and

maga)ine ads, billboards, and telemarketing. #hese tactics allow you to

target, directly, a demographic of your choosing with a customi)ed

message, made special, for them.

http://www.surveygizmo.com/survey-blog/how-to-develop-a-market-research-plan/http://www.surveygizmo.com/survey-blog/how-to-develop-a-market-research-plan/


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#here are some obvious downsides to this method, the one that is probably

the most obvious being the cost of it all. #hese methods are very

expensive, and that can deeply cut into your return on the investment,

especially if you-re a small business with a small budget.

hat counter balances the cost to develop and run these campaigns is the

speed with which you begin to see a return. #his return is also easily

measured, especially if the campaign was well thought out and well

received. But how do we make sure that our campaigns will align the most

precisely with the audience that we are targeting*

It used to be that thousands of dollars were spent on market research into

what our target audience wants to see in a product or service, to produce a

rapport amongst consumers. /ampaigns were often run with the sole goal

of increasing the customer-s trust in the brand being promoted.

This is not the case any more. 0eople now%a%days like their businesses

to be friendly, customer service often makes and breaks customer

relationships. ith the rise of the Internet and the subse"uent social

epiphany of social media, it is now easier, and cheaper , than ever to

create this kind of relationship with your customers. (ll it takes is a person,or team, using indirect marketing techni"ues to gather the type of

information you will need to create campaigns for your chosen

demographic.

Indirect Marketing: Customer Rapport is the

Key

Indirect marketing is social media accounts, blogs, and newsletters, that

don-t try and sell you anything. #hese tactics allow you to build customer

trust and loyalty, and allows you to build a rapport with potential customers

by not shoving pushy sales pitches on them when they are interacting with

you1

In fact, positive interactions on social media can lead to your audience

base being converted from ust potential customers to potential brandevangelists. Indirect marketing leads to this by providing a personali)ed

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point of contact from your business to them. #his conversion from customer

to evangelist all by itself can lead to a huge increase in your return on the

investments you have made 2as explained in our blog here3 and the best

part about it is that it barely costs you anything1

#he only cost normally associated with indirect marketing is the salary, or

salaries, of the marketers 2and marketing interns13 tasked with writing

articles and working with whatever social media accounts you have, be it

&acebook, #witter, or one of the more visual services like Instagram.

#here are downsides to indirect marketing tactics such as the time it takes

to get yourself, or your business, well established on whichever social

media platform you choose. #here are a great many sources on how to

market on social media 2ours is here3, and there are always more popping

up, but it can take some time to get used to the ins and outs of things like

hashtags and search engine optimi)ation.

(nother downside is the difficulty you may find yourself having measuring

results from these tactics. ( retweet, or a reblog, never necessarily means

that the person is interested in buying your product or service. 0erhaps,

though, if we can combine both direct marketing techni"ues, withinformation gleaned from indirect marketing techni"ues, we can find

ourselves in a happy land full of usable data that will provide a great benefit

to your business1

Combine the Techniques Reap the !ene"its o"

!oth#

4ow things will begin to get interesting. ith the potential to build stronger,

closer relationships with your customers through social media, there is a

potential to harvest information from these places that you can then apply

to your direct marketing campaigns.

Information like what television stations your target audience watches most

often, or what maga)ines or newspapers 2online, or traditional paper ones3

they are reading, and even when they may be online and actively checkingtheir email are all pieces of intel that you can use to make sure you get the


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biggest bang for your buck when you go to print, or send off that sales offer

to your list of contacts.

/ollecting this information and using it correctly will lead to larger returns

on your investments, with a smaller financial input from your pocket and a

maximi)ation of the potential of your direct marketing campaigns.

/ombining older, traditional marketing techni"ues with the newer, less

direct tactics of the new market is sure to make the return on every dollar

you spend be the very largest it can be1

Q6

lobal sourcing is the practice of sourcing from the global market for goods and services

across geopolitical boundaries. Global sourcing often aims to exploit global efficiencies in the

delivery of a product or service. #hese efficiencies include low cost skilled labor, low cost raw

material and other economic factors like tax breaks and low trade tariffs. ( large number of

Information #echnology proects and !ervices, including I! (pplications and 5obile (pps and

database services are outsourced globally to countries like 0akistan and India for more

economical pricing.

/ommon examples of globally sourced products or services include: labor%intensive

manufactured products produced using low%cost /hinese labor, call centers staffed with low%cost

nglish speaking workers in the 0hilippines and 0akistan and India, and I# work performed by

low%cost programmers in India and 0akistan and astern urope. hile these examples are

examples of 6ow%cost country sourcing, global sourcing is not limited to low%cost countries.

5aority of companies today strive to harness the potential of global sourcing in reducing cost.

7ence it is commonly found that global sourcing initiatives and programs form an integral part of

the strategic sourcing plan and procurement strategy of many multinational companies.

Global sourcing is often associated with a centrali)ed procurement strategy for a multinational,

wherein a central buying organi)ation seeks economies of scale through corporate%wide

standardi)ation and benchmarking. ( definition focused on this aspect of global sourcing is:

8proactively integrating and coordinating common items and materials, processes, designs,

technologies, and suppliers across worldwide purchasing, engineering, and operating locations

2p. 9;38

#he global sourcing of goods and services has advantages and disadvantages that can go

beyond low cost. !ome advantages of global sourcing, beyond low cost, include: learning how todo business in a potential market, tapping into skills or resources unavailable domestically,

https://en.wikipedia.org/wiki/Procurementhttps://en.wikipedia.org/wiki/Geopoliticalhttps://en.wikipedia.org/wiki/Geopoliticalhttps://en.wikipedia.org/wiki/Call_centershttps://en.wikipedia.org/wiki/Call_centershttps://en.wikipedia.org/wiki/Philippineshttps://en.wikipedia.org/wiki/Philippineshttps://en.wikipedia.org/wiki/Philippineshttps://en.wikipedia.org/wiki/Pakistanhttps://en.wikipedia.org/wiki/Indiahttps://en.wikipedia.org/wiki/Indiahttps://en.wikipedia.org/wiki/Indiahttps://en.wikipedia.org/wiki/Information_technologyhttps://en.wikipedia.org/wiki/Information_technologyhttps://en.wikipedia.org/wiki/Eastern_Europehttps://en.wikipedia.org/wiki/Low-cost_country_sourcinghttps://en.wikipedia.org/wiki/Low-cost_country_sourcinghttps://en.wikipedia.org/wiki/Strategic_sourcinghttps://en.wikipedia.org/wiki/Strategic_sourcinghttps://en.wikipedia.org/wiki/Procurementhttps://en.wikipedia.org/wiki/Multinational_companyhttps://en.wikipedia.org/wiki/Multinational_companyhttps://en.wikipedia.org/wiki/Economies_of_scalehttps://en.wikipedia.org/wiki/Economies_of_scalehttps://en.wikipedia.org/wiki/Benchmarkinghttps://en.wikipedia.org/wiki/Benchmarkinghttps://en.wikipedia.org/wiki/Global_sourcing#cite_note-1https://en.wikipedia.org/wiki/Procurementhttps://en.wikipedia.org/wiki/Geopoliticalhttps://en.wikipedia.org/wiki/Call_centershttps://en.wikipedia.org/wiki/Philippineshttps://en.wikipedia.org/wiki/Pakistanhttps://en.wikipedia.org/wiki/Indiahttps://en.wikipedia.org/wiki/Information_technologyhttps://en.wikipedia.org/wiki/Eastern_Europehttps://en.wikipedia.org/wiki/Low-cost_country_sourcinghttps://en.wikipedia.org/wiki/Strategic_sourcinghttps://en.wikipedia.org/wiki/Procurementhttps://en.wikipedia.org/wiki/Multinational_companyhttps://en.wikipedia.org/wiki/Economies_of_scalehttps://en.wikipedia.org/wiki/Benchmarkinghttps://en.wikipedia.org/wiki/Global_sourcing#cite_note-1


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developing alternate supplier?vendor sources to stimulate competition, and increasing total

supply capacity. !ome key disadvantages of global sourcing can include: hidden costs

associated with different cultures and time )ones, exposure to financial and political risks in

countries with 2often3 emerging economies, increased risk of the loss of intellectual property, and

increased monitoring costs relative to domestic supply. &or manufactured goods, some key

disadvantages include long lead times, the risk of port shutdowns interrupting supply, and the

difficulty of monitoring product "uality. 2ith regard to "uality in the food industry, see @oth et al.

2A3.3.

International procurement organi)ations 2or I0's3 may be an element of the global sourcing

strategy for a firm. #hese procurement organi)ations take primary responsibility for identifying

and developing key suppliers across sourcing categories and help satisfy periodic sourcing

re"uirements of the parent organi)ation. !uch setups help provide focus in country%based

sourcing efforts. 0articularly in the case of large and complex countries, such as /hina, where a

range of sub%markets exist and suppliers span the entire value chain of a product?commodity,

such I0's provide essential on%the%ground information.

'ver time, these I0's may grow up to be complete procurement organi)ations in their own right,

with fully engaged category experts and "uality assurance teams. It is therefore important for

firms to clearly define an integration and scale%up plan for the I0'.

Q

What is Inventory Management

"ffective inventory management is all about kno#ing #hat is on hand, #here it is in use, and

ho# much finished product results$

Inventory management is the process of efficiently overseeing the constant flow of units into and out

of an existing inventory. #his process usually involves controlling the transfer in of units in order to

prevent the inventory from becoming too high, or dwindling to levels that could put the operation of the

company into eopardy. /ompetent inventory management also seeks to control the costs associated

with the inventory, both from the perspective of the total value of the goods included and the tax

burden generated by the cumulative value of the inventory.

Balancing the various tasks of inventory management means paying attention to three key aspects of

any inventory. #he first aspect has to do with time. In terms of materials ac"uired for inclusion in the

total inventory, this means understanding how long it takes for a supplier to process an order and

execute a delivery. Inventory management also demands that a solid understanding of how long it will

take for those materials to transfer out of the inventory be established. Cnowing these two important

lead times makes it possible to know when to place an order and how many units must be ordered to

keep production running smoothly.

/alculating what is known as buffer stock is also key to effective inventory management. ssentially,

buffer stock is additional units above and beyond the minimum number re"uired to maintain

production levels. &or example, the manager may determine that it would be a good idea to keep one

https://en.wikipedia.org/wiki/Global_sourcing#cite_note-2https://en.wikipedia.org/wiki/Market_(economics)https://en.wikipedia.org/wiki/Market_(economics)https://www.barcodesinc.com/solutions/market-applications/inventory.htmhttps://www.barcodesinc.com/solutions/market-applications/inventory.htmhttps://www.barcodesinc.com/solutions/market-applications/inventory.htmhttps://en.wikipedia.org/wiki/Global_sourcing#cite_note-2https://en.wikipedia.org/wiki/Market_(economics)https://www.barcodesinc.com/solutions/market-applications/inventory.htm


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or two extra units of a given machine part on hand, ust in case an emergency situation arises or one

of the units proves to be defective once installed. /reating this cushion or buffer helps to minimi)e the

chance for production to be interrupted due to a lack of essential parts in the operation supply

inventory.

Inventory management is not limited to documenting the delivery of raw materials and the movementof those materials into operational process. #he movement of those materials as they go through the

various stages of the operation is also important. #ypically known as a goods or work in progress

inventory, tracking materials as they are used to create finished goods also helps to identify the need

to adust ordering amounts before the raw materials inventory gets dangerously low or is inflated to an

unfavorable level.

&inally, inventory management has to do with keeping accurate records of finished goods that are

ready for shipment. #his often means posting the production of newly completed goods to the

inventory totals as well as subtracting the most recent shipments of finished goods to buyers. hen

the company has a return policy in place, there is usually a sub%category contained in the finished

goods inventory to account for any returned goods that are reclassified as refurbished or second

grade "uality. (ccurately maintaining figures on the finished goods inventory makes it possible to

"uickly convey information to sales personnel as to what is available and ready for shipment at any

given time.

In addition to maintaining control of the volume and movement of various inventories, inventory

management also makes it possible to prepare accurate records that are used for accessing any

taxes due on each inventory type. ithout precise data regarding unit volumes within each phase of

the overall operation, the company cannot accurately calculate the tax amounts. #his could lead to

underpaying the taxes due and possibly incurring stiff penalties in the event of an independent audit.

:odu$e

Importance of %ales &romotion for a 'ompany!

!ales are the lifeblood of a businesswithout sales there would be no

business in the first placeE therefore it is very important that if a business

wants to succeed, it should have a sales promotion strategy in mind. #he

primary obective of a sales promotion is to improve a company-s sales by

predicting and modifying your target customer-s purchasing behaviour and

patterns. !ales promotion is very important as it not only helps to boost

sales but it also helps a business to draw new customers while at the same

time retaining older ones.


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( business can promote itself through and effective sales promotion

because it says something about work and helps the business to identify

themselves. #hey can be an inexpensive way of increasing awareness, of

reaching new buyers or extending the buying choices of existing

audiences. (s an essential part of any promotional campaign they should

be planned from the beginning.

hile sales promotions can often be done cheaply, there should always be

a line item for this activity in the budget, no matter how small because the

support can in turn increase the efficiency and impact of the sales

promotion. !ales promotions often involve working with other

organi)ations. #his could help in building mutually beneficial relationships,

leading to sponsorships.

dvertisements are messages paid for by those who send them and are intended to inform or

influence people who receive them.

Definition( (dvertising is a means of communication with the users of a product or service.

(dvertisements are messages paid for by those who send them and are intended to inform or

influence people who receive them, as defined by the (dvertising (ssociation of the FC.

Description( (dvertising is always present, though people may not be aware of it. In today$s

world, advertising uses every possible media to get its message through. It does this via

television, print 2newspapers, maga)ines, ournals etc3, radio, press, internet, direct selling,

hoardings, mailers, contests, sponsorships, posters, clothes, events, colours, sounds, visuals

and even people 2endorsements3.

#he advertising industry is made of companies that advertise, agencies that create the

advertisements, media that carries the ads, and a host of people like copy editors, visuali)ers,

brand managers, researchers, creative heads and designers who take it the last mile to the

customer or receiver. ( company that needs to advertise itself and?or its products hires an

advertising agency. #he company briefs the agency on the brand, its imagery, the ideals and

values behind it, the target segments and so on. #he agencies convert the ideas and concepts to

create the visuals, text, layouts and themes to communicate with the user. (fter approval from

the client, the ads go on air, as per the bookings done by the agency$s media buying unit.

Whether at home or at work, if you want to reach customers directly,

the best way to do it is with direct mail. Physical mailings can make


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product promotion more targeted, give fuller product descriptions

and lead directly to sales.

ith a broad range of design possibilities, you can really get people-s attention. ou can

respond effectively to cultural differences and use targeted, personal forms of address to

get close to your target group. Direct mail has a high acceptance level, which means that

potential customers are more likely to pay attention to the offering H even if they don-t

2yet3 know the sender.

Direct mail is inexpensive in comparison to other marketing activities such as # spots.

/ost and wastage levels are significantly lower. #hey also provide an excellent

opportunity for applying recipient selection criteria, which allows you to test multiple

alternatives for your target country. ou can evaluate the mailing-s success right away

using codes on the reply elements.

(dvantages over e%mails

#here are fewer e%mail addresses than postal addresses and the address sources are

generally poorer. %mails generally have a shorter lifespan and there is no guarantee

that they are displayed correctly. ven if you have correct e%mail addresses, your mails

may end up in the spam bin or be deleted immediately. #he content of electronic

advertising provides only initial appealE it is not at all suitable for providing detailed

information. hile campaigns that use only e%mail have limited success, e%mail is a very

good method to use in combination with physical mailings in multichannel marketing.

#hey give you an additional, cost%effective way to reach your customers.

(dvantages over print ads or supplements in maga)ines and newspapers

(ds and supplements are often ignored or merely skimmed. It is harder to target them,

which means that fewer people read them. /ustomers feel less personally addressed by

advertising that is addressed to everyone than they do by direct one%to%one

communication. #he space for presenting an offering is also very limited in print ads,

which is usually due to high costs.

#he advantages of an envelope with a supplement and reply element

( mailing gives the impression of being premium%"uality and it sparks the recipient$s

curiosity. /ustomers have the opportunity to get comprehensive information and respond

immediately if they are interested. @eply elements are also well%suited for dialogue with

the customer 2en"uiries, orders, etc.3 and for performance measurement.

By combining elements, you have the opportunity to divide the message among different

parts of the mailing. #his is also particularly good for en"uiries, complex messages,

comprehensive information, confidential information, notices of sale, orders and

sweepstakes, and for achieving a high response rate.


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It has always been the case that customers respond to striking, unusual mailings that

stand out because of their unconventional si)e or design. 5ailing packages that include

a letter, a flyer and a reply element are ideal for sparking a campaign on a tight

schedule.

#raditional mailing will be around for a long time. In combination with other marketing

instruments, it provides increased sales in e%commerce, as well as in mail%order

business and over%the%counter retailing.

#he advantages of postcard mailings

0ostcard mailings are eye%catching, cost%effective, and ideal for "uickly conveying

simple messages. 0ostcards are perfect to use for advance notices, reminders or

information about special deals at retail locations or in web%shops. #hey are particularly

useful if the communication is networked % for example, if they provide an Internet link or

trigger a phone call.

0ostcards are an efficient marketing instrument for small budgets, and will always play a

role in the dialogue marketing mix because of their expediency and their high attention

value.

Qc

Defnition: E-Marketing

E-Marketing (Electronic Marketing) are also known as Internet Marketing, Web Marketing, Digital

Marketing, or Online Marketing. E-marketing is the process o marketing a pro!"ct or ser#ice

"sing the Internet. It not onl$ incl"!es marketing on the Internet, b"t also incl"!es marketing

!one #ia e-mail an! wireless me!ia. It "ses a range o technologies to help connect b"sinesses to

their c"stomers.


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5arketing has pretty much been around forever in one form or another . !ince the day when humans first

started trading whatever it was that they first traded, marketing was there. 5arketing was the stories they used to

convince other humans to trade. 7umans have come a long way since then, 2ell, we like to think we have3

and marketing has too.

#he methods of marketing have changed and improved, and we$ve become a lot more efficient at telling our

stories and getting our marketing messages out there. e5arketing is the product of the meeting betweenmodern

communication technologies and the age%old marketing principles that humans have always applied.

#hat said, the specifics are reasonably complex and are best handled piece by piece. !o we-ve decided to break

it all down and tackle the parts one at a time. #his week we-ll be looking at the )#hat) and )#hy) of

eMarketing, outlining the benefits and pointing out how it differs from traditional marketing methods.

By the end of the series we$re pretty sure you$ll have everything you need to tell better marketing stories.

hat is e5arketing*

ery simply put, eMarketing or electronic marketing refers to the application of marketing principles and

techni"ues via electronic media and more specifically the Internet. #he terms eMarketing, Internet

marketing and online marketing, are fre"uently interchanged, and can often be considered synonymous.

e5arketing is the process of marketing a brand using the Internet. It includes both direct response marketing

and indirect marketing elements and uses a range of technologies to help connect businesses to their customers.

By such a definition, e5arketing encompasses all the activities a business conducts via the #orld#ide #ebwith

the aim of attracting new business, retaining current business and developing its brand identity.

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hy is it important*

hen implemented correctly, the return on investment 2@'I3 from e5arketing can far exceed that of traditional

marketing strategies.

hether you$re a 8bricks and mortar8 business or a concern operating purely online, the Internet is a force that

cannot be ignored. It can be a means to reach literally millions of people every year. It$s at the forefront of a

redefinition of way businesses interact with their customers.

/&at is ,commerce and t&e )mportance of ,commerce

,lectronic commerce0 or ,commerce, which literally means business trading

through the Internet, has been around the globe since mid 67s. 8owever, until therecent few years, +commerce is getting more and more attention from entrepreneurand consumers, both local and international. 2ne of the main reasons is due to the

highly successful operations of some well known names on the Internet, such as e9ay,:ahoo and -ell. 'he sales revenue these companies shown in their annual reports arewithout doubt, one of the biggest factors whyEcommerce is important in thecommercial market nowadays.

+commerce proved its importance based on the fact where time is essence. In the

commercial markets, time plays an important role to both the business andconsumers. From the business perspective, with less time spent during each

transaction, more transaction can be achieved on the same day. As for the consumer,

they will save up more time during their transaction. 9ecause of this, +commercesteps in and replaced the traditional commerce method where a single transaction cancost both parties a lot of valuable time. )ith (ust a few clicks in minutes, a transactionor an order can be placed and completed via the internet with ease. For instance, abanking transaction can be completed through the Internet within a few minutescompared to the traditional banking method which may take up to hours. 'his factobviously proves that +commerce is beneficial to both business and consumer wise aspayment and documentations can be completed with greater efficiency.

From the business viewpoint, +commerce is much more cost effective compared totraditional commerce method. 'his is due to the fact where through +commerce, the

cost for the middleperson to sell their products can be saved and diverted to anotheraspect of their business. 2ne e0ample is the giant computer enterprise, -ell, whichpractice such a method by running most of their business through internet withoutinvolving any third parties. Aside from that, marketing for +commerce can achieve abetter customer to cost ratio as putting an advertisement on the internet iscomparably much cheaper than putting up a roadside banner or filming a televisioncommercial. For +commerce, the total overheads needed to run the business issignificantly much less compared to the traditional commerce method. 'he reason due

to that is where most of the cost can be reduced in +commerce. For e0ample, inrunning an +commerce business, only a head office is needed rather than a head office

with a few branches to run the business. In addition to that, most of the cost for staff,maintenance, communications and office rental can be substitute by a single cost, webhosting for the +commerce business.

'o both the consumers and business, connectivity plays an important part as it is thekey factor determining the whole business. From the business point of view,

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+commerce provides better connectivity for its potential customer as their respectivewebsite can be accessed virtually from anywhere through Internet. 'his way, morepotential customers can get in touch with the company%s business and thus,eliminating the limits of geographical location. From the customer standpoint,+commerce is much more convenient as they can browse through a whole directoriesof catalogues without any hassle, compare prices between products, buying from

another country and on top of that, they can do it while at home or at work, withoutany necessity to move a single inch from their chair. 9esides that, for both consumers

and business, +commerce proves to be more convenient as online trading has less redtape compared to traditional commerce method.

In global market sense, the appearance of +commerce as a pioneer has opened upvarious windows of opportunities for a variety of other companies and investors. Forinstance, due to the booming of +commerce, more and more resources are beingdirected into electronic securities, internet facilities, business plans and newtechnologies. In result of this phenomenon, a variety of new markets have emergedfrom +commerce itself giving a boost to the global market.

In short, if without any ma(or obstacles, ,commerce will certainly continue to maturein the global market and eventually, it will become an essential business plan for a

company in order to survive and stay competitive in the ever changing market.

The $ist goes on %ith many e&amp$es such as In!e' acquiring !ud%eiser to

add to their house o" brands that inc$udes (te$$a !ecks and )abatt* +r ,ee$ey

Motors o" China acquiring cu$t (%edish -uto brand .o$'o* +r Mahindra o"

India buying (sangyong Korea/s third $argest car company*

!randing is "undamenta$* !randing is basic* !randing is essentia$* !ui$ding

brands bui$ds incredib$e 'a$ue "or companies and corporations*

I" you are sti$$ not con'inced $et me gi'e you another e&amp$e* The do$$ar is a

%or$d brand* In essence it is simp$y a piece o" paper* !ut branding has made it

'a$uab$e* -$$ the too$s o" marketing and brand bui$ding ha'e been used to

create its 'a$ue* +n the "ront you %i$$ "ind the o%ner o" the brand: the Federa$

Reser'e* There is a testimonia$ "rom the "irst 0resident o" the 1nited (tates

,eorge =ashington* There is a simp$e users guide: 2This note is $ega$ tender

"or debts pub$ic and pri'ate*3 -nd i" you/re sti$$ not con'inced the o%ner has

added the a$$ important emotiona$ message: 2In ,od We Trust3* The do$$ar is a %or$d brand* It con"ers a uni"orm 'a$ue g$oba$$y* !ut as I said it/s rea$$y 4ust a

piece o" paper* !randing has made it %orth something*

I mentioned ear$ier that brands are more important today than in the past*

There are a "e% reasons "or this* First$y the %or$d has come on$ine and there

are many ne% markets and a gro%ing midd$e c$ass in p$aces $ike India China

!ra5i$ Russia (outh -"rica 6igeria Indonesia and in many more p$aces*

These consumers buy brands* They buy premium brands* The best branding

today is based on a strong idea* The best brands ha'e remarkab$e creati'ity inad'ertising to he$p them break through peop$e/s %a$$ o" indi""erence to create

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brand heat and product $ust* Case in point the recent turn around of

Chrys$er and it>s re$iance on mar&eting and advertising* (r $oo& at

the reinvention of /evis. -nd a "ina$ e&amp$e is this campaign 'y my

o#n agency #hich has he$ped reenergis great

iconic 'rands Jim ;eam*

(econd$y %hen %e create ne% brands at my Ne# Oor& City ad'ertising agency

(tra%berryFrog %e ha'e "e%er brand names to choose "rom* The

0harmaceutica$ Industry has patented e'erything under the sun "or ne%

medications* This makes e&isting brands %ith their strong %e$$7kno%n names

and credibi$ity more 'a$uab$e* It a$so means creating a ne% 'ibrant brand is a

cha$$enge %hich requires a sophisticated strategy* It is not 4ust about a product

and a name it/s about a $ot more*

The sophisticated strategy is a cu$tura$ mo'ement strategy* I be$ie'e that

bui$ding brands no% requires a cu$tura$ mo'ement strategy as opposed to

simp$y a brand bui$ding strategy* - cu$tura$ mo'ement strategy can acce$erate

your brand/s rise to dominance* +nce you ha'e cu$tura$ mo'ement you can do

anything in a "ragmenting media en'ironment ma&imi5ing the po%er o" socia$

media and techno$ogy* The %or$d has changed* We are no% $i'ing in the age o"

uprisings and mo'ements* I ha'e %ritten about ho% to bui$d a brand in this

ne% age in my ne% book prising* 6o% bui$ding brands has become a $ot $ess

e&pensi'e and smart brands can take ad'antage o" ne% too$s and rocket upthere g$oba$$y 'ery "ast*

In the "ace o" the current economic cha$$enges it/s %orth noting that brands do

better in tough times compared to unbranded products* !rands out$i'e

product cyc$es* -nd in these cha$$enging times there are sti$$ great brands

being bui$t* !rand o%ners sti$$ recognise opportunity and their brands %i$$

thri'e in the years ahead* !rands such as 89M o" (%eden or Tes$a a great

ne% car brand as %e$$ as ne% names such as Tom/s (hoes 8onest Tea and a

rising brand "rom F$orida ca$$ed uropean Wa& Center %hich Inc* Maga5inenamed a company to %atch*

6o branding no di""erentiation* 6o di""erentiation no $ong7term pro"itabi$ity*

0eop$e don/t ha'e re$ationships %ith products they are $oya$ to brands* In a

mo'ement strategy brands ha'e a purpose that peop$e can get behind* !rands

can inspire mi$$ions o" peop$e to 4oin a community* !rands can ra$$y peop$e "or

or against something* 0roducts are one dimensiona$ in a socia$ media enab$ed

%or$d brands are Russian do$$s %ith many $ayers tenents and be$ie"s that can

create great "o$$o%ings o" peop$e %ho "ind them re$e'ant* !rands can acti'ate a

http://www.forbes.com/sites/jeanhalliday/2012/03/13/the-art-of-advertising-a-la-chrylsers-groups-cmo/http://www.forbes.com/sites/jeanhalliday/2012/03/13/the-art-of-advertising-a-la-chrylsers-groups-cmo/http://www.forbes.com/sites/jeanhalliday/2012/03/13/the-art-of-advertising-a-la-chrylsers-groups-cmo/http://www.youtube.com/watch?v=HG8tqEUTlvshttp://www.youtube.com/watch?v=HG8tqEUTlvshttp://www.youtube.com/watch?v=HG8tqEUTlvshttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.forbes.com/places/ny/new-york/http://www.forbes.com/places/ny/new-york/http://www.uprisingmovements.com/http://www.forbes.com/sites/jeanhalliday/2012/03/13/the-art-of-advertising-a-la-chrylsers-groups-cmo/http://www.forbes.com/sites/jeanhalliday/2012/03/13/the-art-of-advertising-a-la-chrylsers-groups-cmo/http://www.youtube.com/watch?v=HG8tqEUTlvshttp://www.youtube.com/watch?v=HG8tqEUTlvshttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.time.com/time/specials/packages/article/0,28804,2101344_2101187_2101181,00.htmlhttp://www.forbes.com/places/ny/new-york/http://www.uprisingmovements.com/


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passionate group o" peop$e to do something $ike changing the %or$d* 0roducts

can/t rea$$y do that*

In today/s %or$d branding is more important than e'er* !ut you can/t simp$y

bui$d a brand $ike they did in the o$d days* You need a cu$tura$ mo'ementstrategy to achie'e kinetic gro%th "or your brand* With that the sky/s the $imit*

:odu$e M

Qa

(n obvious "uestion arises is: why is documentation needed in export

business* (nswer to this "uestion lies in the nature of the business

relations between the exporter and the importer operating from two

countries. 'ne knows, unlike the domestic business, the commercial

practices and legal systems are different in the two countries the exporter

and importer are operating from.

#herefore, in order to protect the respective interests of the exporter and

the importer involved in export business, certain documentary formalities

become essential. !uch documentation facilitates the smooth flow of goods

and payments thereof across national frontiers.

"xport documents based on the functions performed by them are

broadly classified into four types(

=. /ommercial Documents

A. @egulatory Documents

9. xport (ssistance Documents

;. Documents re"uired by Importing /ountries.


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6et us now discuss the specific documents and functions performed by

them under each category.

Commercial Documents: 1. Commercial Invoice:

#his is the first basic and the only complete document in an export

transaction. It is, in fact, a document of contents containing information

about goods. 7armoni)ed !ystem 4omenclature 27!43, price charged, the

terms of shipment and marks and numbers on the packages containing the

merchandise.

The exporter needs this document for other purposes also such as(

2i3 'btaining export inspection certificate

2ii3 Getting excise clearance

2iii3 Getting customs clearance and

2iv3 !ecuring such incentives as cash compensatory support 2//!3 and

import license.

#his document is prepared at both the pre%shipment and post%shipment

stages.

Besides commercial invoice, there is a proforma invoice also. It is a

temporary commercial invoice which is sent by the exporter to the importer.

It covers contemplated shipment which may or may not be made in future.

#he importer re"uires this document for obtaining an import license and

opening a letter of credit in favour of the exporter. ith such obvious

importance of proforma invoice, the exporter should cultivate a habit of


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sending proforma invoice to the importer, even if the same is not

demanded.

2. Bill of Lading:

Bill of lading 2B?63 is a document which is issued by the shipping company

acknowledging that the goods mentioned therein are either being shipped

or have been shipped. #his is also an undertaking that the goods in like

order and condition as received will be delivered to the consignee, provided

that the freight specified therein has been duly paid.

*ill of lading serves three distinct functions(

2i3 It is an evidence of the contract of affreightment 2transport3.

2ii3 It is a receipt given by the shipping company for cargo received by it.

2iii3 It is a document of title to the goods shipped.

#he bill of lading gives the details about the exporter, carrying vessel,

goods shipped, port of shipment, destination, consignee and the party to be

notified on arrival of the goods at destination. Bill of ladings is made the

sets.

3. Airway Bill:

In air carriage, the transport document is known as the airway bill. #his

document performs three functions of a forwarding note for the goods,

receipt for the goods tendered, and authority to obtain delivery of goods.

!ince it is non%negotiable, so it does not carry the same validity as a bill of

lading for sea transport carries.


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4. Bill of Exchange (BE!:

Bill of exchange is an instrument or draft used for the payment in

international ? export business. It is an instrument in writing containing anunconditional order, signed by the marker, directing a certain person to pay

a certain sum of money only to or to the order of a person or to the bearer

of the instrument. #he person to whom the bill of exchange is addressed is

to pay either on demand or at a fixed or a determinable future.

There are three parties involved in a bill of exchange(

+i The Dra#er +"xporter(

#he person who makes and executes the B? or say, the person to whom

payment is due.

+ii The Dra#ee +Importer(

#he person on whom the B? is drawn and who is re"uired to meet the

terms of the document.

+iii The &ayee +"xporter or "xporter-s *ank(

#he party to receive the payment.

". Le##er of Credi#:

It is a written instrument issued by the buyer-s 2importer-s3 bank,

authorising the seller 2exporter3 to draw in accordance with certain terms

and stipulating in a legal form that all such bills 2drafts3 will be honoured.

6etter of credit provides the exporter with more security than open accounts

or bills of exchange.

A commercial letter of credit involves the follo#ing three parties(


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2i3 #he opener or importer H the buyer who opens the credit

2ii3 #he issuer H the bank that issues the letter of credit.

2iii3 #he beneficiary H the seller in whose favour the credit is opened.

*ased on differing conditions, letters of credit may be of the follo#ing

types(

+a .evocable and Irrevocable(

In case of revocable letter of credit, the buyer or issuer can cancel or

change an obligation at any time prior to payment without prior notice to the

exporter or seller. hen the letter is irrevocable, the buyer cannot cancel or

change obligation without the exporter-s permission.

+b 'onfirmed and /nconfirmed(

In case of confirmed letter of credit, the payment is guaranteed by the

issuing bank. hen the letter is unconfirmed, no such guarantee is given

by the bank.

+c With and Without .ecourse(

ith recourse means if the buyer fails to pay the bank after a specified

period, the bank can have recourse on the exporter. #here is no such

provision in the letter of credit without recourse.

Regulatory Documents:

0$ 1egal Documents for "xport from India(

There are t#o types of regulatory documents(


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2i3 Documents needed for registration, and

2ii3 Documents needed for shipment.

The first category documents include applications and other

supporting documents for obtaining(

2i3 /ode number from the @eserve Bank of India 2@BI3,

2ii3 Importers and exporters- code numbers from the /hief /ontroller of

Imports and xports,

2iii3 @egistration%cum%membership certificate 2@/5/3, etc.

The documents needed for shipment of goods include the follo#ing(

(i! $% &orm:

It is re"uired to be filled in duplicate for all exports other than by post. Both

of the copies have to be submitted to the customs authorities at the port of

shipment. #hey will retain the original copy to be sent to the @eserve Bank

of India directly.

#hey will return the duplicate copy which is submitted to the negotiating

bank along with other documents after shipment of goods. #he negotiating

bank sends the duplicate copy to the @BI after the export proceeds have

been realised.

(ii! '' &orm:

xports to all countries by parcel post 2003, except when made on Jvalue

payable- or Jcash on delivery- basis should be declared on 00 forms.


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(iii! 'C)* &orm:

It is re"uired to be filled in one copy for exports to all countries by post

parcel under arrangements to realise proceeds through postal channels onJvalue payable- or Jcash on delivery- basis.

(iv! E' &orm:

!hipment to (fghanistan and 0akistan other than by post should be

declared on 0 forms.

(v! +)&,E- &orm:

It is re"uired to be prepared in triplicate for export of computer software in

non%physical form.

2$ %hipping *ill(

#he shipping bill is the main document on the basis of which the custom-s

permission for export is given. 0ost parcel consignment re"uires customs

declaration form to be filled in. #here are three types of shipping bills

available with the customs authorities.

These are(

+i 3ree %hipping *ill(

It is used for export of goods for which there is no export duty.

+ii Dutiable %hipping *ill(

0rinted on yellow paper, it is used in case of goods which are subect to

export duty?cess.

+iii Dra#back %hipping *ill(


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It is usually printed on green paper and is used for export of goods entitled

to duty drawback.

4$ Marine Insurance &olicy(

It is the basic instrument in marine insurance. ( marine policy is a contract

and a legal document which serves as evidence of the agreement between

the insurer and the assured. #he policy must be produced to press a claim

in a court of law. (n exporter must also put up the marine insurance policy

as a collateral security when he gets an advance against his bank /redit.

Exports Assistance Documents:

&or availing of a number of incentives and assistance, an exporter is

re"uired to fill in a number of documents.

%ome of the important ones of these are discussed here(

0$ Application 3orm for .egistration(

xporters desirous of availing themselves of the benefits of the import

policy are re"uired to register themselves with the appropriate registering

authority such as xport 0romotion /ouncils 20/3, /ommodity Boards

and /hief /ontroller of Imports and xports 2//I3, 4ew Delhi.

#he application for registration should be accompanied by a certificate from

the exporter-s bankers in regard to his financial soundness. In case of a

firm having branches, the application for registration shall be submitted only

by the 7ead 'ffice.

2$ Allotment of Indigenous .a# Materials on &riority *asis(


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5anufacturer% exporters may apply to the Director of xport 0romotion,

5inistry of /ommerce, for replenishment of the indigenous materials used

in the manufacture of goods for export.

4$ Duty Dra#back(

&or claiming this incentive, the main document is the customs attested

drawback copy of shipping bill. #his is to be accompanied by other

documents such as drawback payment order, final commercial invoice and

a copy of bill of lading or airway bill, as the case may be.

5$ ."& 1icense and ''%(

&or claiming @0 license and cash compensatory support 2//!3, the

exporter is re"uired to prepare and file a number of documents.

The main documents in this regard are(

2i3 (pplication in the prescribed form

2ii3 (cknowledgement slip

2iii3 Bank challan issued by the treasury for the application fee paid.

2iv3 (dvance receipt for cash assistance amount

2v3 ( duly certified copy of shipping bill.

2vi3 4on%negotiable copy of bill of lading?airway bill.


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Documents required by importing Countries:

In case of export business, the importing countries need some documents

because of the legal necessity. #hese documents are obtained by theexporter and are sent to the importer.

%ome of the #ell6kno#n documents are as follo#s(

1. Con/lar Invoice:

It is usually issued on the specified form by the consulate of the importing

country situated in the exporting country. It gives a declaration about the

true value of goods shipped. #he customs authorities of importing company

charge valorem based on the value mentioned on consular invoice.

2. Cer#ifica#e of )rigin:

#his certificate is issued by the independent bodies like chamber of

commerce or export promotion council in the exporting country. #his is a

certification that the goods being exported were actually produced in that

particular country.

3. $+' Cer#ifica#e of )rigin:

Goods which get the benefit preferential import%duty treatment in countries

which implement the Generalised !ystem of 0references 2G!03 should be

accompanied by the G!0 certificate of origin. #his certificate is given on the

forms prescribed by the importing countries.

4. C/#om Invoice:

It is also made out on a specified form prescribed by the customs authority

of the importing country. #he details given on the document will enable the

customs authority of the importing country to levy and charge import duty.


35/53

". Cer#ified Invoice:

#his is the self%certified invoice by the exporter about the origin of the

goods.

Import and E+port /icensing Procedures

in India

0osted on (ugust =A, A=9 by India Briefing

Editor’s Note: Please find an updated July 2014 version of this article linked here.

India-s import and export system is governed by the &oreign #rade 2Development K @egulation3 (ct of =LLA and

India-s xport Import 2MI53 0olicy. Imports and exports of all goods are free, except for the items regulated by

the MI5 policy or any other law currently in force. @egistration with regional licensing authority is a prere"uisite

for the import and export of goods. #he customs will not allow for clearance of goods unless the importer has

obtained an Import xport /ode 2I/3 from the regional authority.

Import &olicy

#he Indian #rade /lassification 2I#/3%7armoni)ed !ystem 27!3 classifies goods into three categories:

=. @estricted

A. /anali)ed

9. 0rohibited

Goods not specified in the above mentioned categories can be freely imported without any restriction, if theimporter has obtained a valid I/. #here is no need to obtain any import license or permission to import such

goods. 5ost of the goods can be freely imported in India.

Restricted Goods

@estricted goods can be imported only after obtaining an import license from the relevant regional licensing

authority. #he goods covered by the license shall be disposed of in the manner specified by the license authority,

which should be clearly indicated in the license itself. #he list of restricted goods is provided in I#/ 27!3. (n

import license is valid for A; months for capital goods, and = months for all other goods.

Canalized Goods

/anali)ed goods are items which may only be imported using specific procedures or methods of transport. #he

list of canali)ed goods can be found in the I#/ 27!3. Goods in this category can be imported only through

http://www.india-briefing.com/news/author/india-briefing/http://www.india-briefing.com/news/author/india-briefing/http://www.india-briefing.com/news/import-policy-procedures-duties-8728.html/http://www.india-briefing.com/news/import-policy-procedures-duties-8728.html/http://www.india-briefing.com/news/author/india-briefing/http://www.india-briefing.com/news/import-policy-procedures-duties-8728.html/


36/53

canali)ing agencies. #he main canali)ed items are currently petroleum products, bulk agricultural products, such

as grains and vegetable oils, and some pharmaceutical products.

Prohibited Goods

#hese are the goods listed in I#/ 27!3 which are strictly prohibited on all import channels in India. #hese include

wild animals, tallow fat and oils of animal origin, animal rennet, and unprocessed ivory.

"xport &olicy

+ust like imports, goods can be exported freely if they are not mentioned in the classification of I#/ 27!3. Below

follows the classification of goods for export:

• @estricted

• 0rohibited

• !tate #rading nterprise

Restricted Goods

Before exporting any restricted goods, the exporter must first obtain a license explicitly permitting the exporter to

do so. #he restricted goods must be exported through a set of procedures?conditions, which are detailed in the

license.

Prohibited Goods

#hese are the items which cannot be exported at all. #he vast maority of these include wild animals, and animal

articles that may carry a risk of infection.

State Trading Enterprise (STE)

/ertain items can be exported only through designated !#s. #he export of such items is subect to the

conditions specified in the MI5 policy.

Types of Duties

#here are many types of duties that are levied in India on imports and exports. ( list of these duties follows

below:

Basic Duty

Basic duty is the typical tax rate that is applied to goods. #he rates of custom duties are specified in the &irst and

!econd !chedules of the /ustoms #ariff (ct of =LNO. #he &irst !chedule contains rates of import duty, and the

second schedule contains rates of export duties. 5ost of the items in India are exempt from custom duty, which isgenerally levied on imports.

#he first schedule contains two rates: !tandard rate and preferential rate. #he preferential rate is lower than the

standard rate. hen goods are imported from a place specified by the central government 2/G3 for lower rates,

the preferential rate is applicable. In any other case, the standard rate will be applicable. If the /G has signed a

trade agreement with the country of origin, then the /G may opt to charge a lower basic duty than indicated in

the first schedule.

Additional Custos Duty (Counter!ailing Duty)

In addition to the basic duty on imported goods, a countervailing duty is also applicable to imported goods. #he

rate of duty is e"ual to the rate of excise applied to goods manufactured in India. If the article is not manufacturedin India, then goods of a similar nature are used to determine the correct duty amount. If there are different rates

of duty on similar goods, then the highest rates of the known products will be applied to the article in "uestion.


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Additional Duty ("AT)

#he /G may levy an additional duty e"uivalent to sales tax or (# charged on sale?purchase in India. #he rate

cannot exceed ; percent. 7owever, the additional duty shall be refunded when the imported goods are sold if the

following conditions are satisfied:

=. #he importer pays all the custom dutiesE

A. #he sale invoice shall bear the indication that the credit of such duty shall not be allowedE and

9. Importer shall pay (#?sales tax on the sale of these goods.

Anti#Duping Duty

#he /G may impose an anti%dumping duty if an article is imported to India at less than its normal price, and will

notify the importer if they decide to do so. #he amount of duty cannot exceed the margin of dumping. #he margin

of dumping means the difference between the export price and the normal price.

#he notification issued by /G in this regard shall be valid for five years. #he period can be further extended.

7owever, the total period cannot exceed = years from the date of first imposition.

Counter!ailing Duty on Subsidized Articles

( countervailing duty is a tariff applied to imported goods to neutrali)e the effect of a subsidy from the country of

origin. If any country grants subsidies on any article to be imported to India, whether directly from the same

country or otherwise, then the /G may impose a countervailing duty e"ual t