A-AS Level (CIE) Business Studies Paper-3: Specimen Questions with Answers 2 - 3 of 20

Passage

Case Study -1

Music and youth go hand in hand. It was this generalization, based on observations, that made Akio Morita, the legendary chairman of Sony Corporation, launch the Walkman. Television channels and Internet thus dedicated channels to music for the young in keeping with the times. Television channels (V) , MTV, and Napster Country Music on the Net and Planet M — the music store for the youth are the symbols of today՚s youth. Channel [V] was launched as a young western music channel. Soon it was overtaken by MTV which reflected the Indian Youth՚s performances in a better way, MTV brought in the language that young people used in common conversation. A combination of English and Hindi, nicknamed- Hinglish is the lingua franca of MTV. It introduced Hindi music and reveled in making fun of itself. Today՚s youth are more casual and willing to take shots at themselves. In 1999, Channel [V] decided to fight back by positioning itself as a youth channel and dumping its previous music channel image. The channel announced 21 new pro grammes, 19 of which were non-music. The new programmes were targeted at the Indian youth, who believed in substance rather than style alone. According to the in house research of Channel [V] , the youth of India was less swayed by music than their Parents feared. The youth think about relationships, career, sex, AIDS, and politics. This market was looking for information which no channel provided the youth had matured in terms of tastes. These findings made Channel [V] reduce its music component to 50 to 60 percent. The balance were programmes dedicated to information on career, fashion, gadgets, and so forth. With this revamp, [V] aims to keep the wandering young surfer hooked. Accordingly, it reoriented its programming to three main segments-teen, main stream, and the young adult. This classification was based on prime time for these three sub-segments of the youth market. The rationale for determining prime time for these segments was: The youth had no control over what the family watched during the family prime time (7: 00 pm to 10: 00 pm)

  • The 13 - 19-year-old watched TV either prior to school timing or immediately after that (i.e.. 7 - 10 am and 4 - 7 pm)
  • The young adult watched TV after 10: 00 pm Backed with this research, [V] decided to market itself on air, on ground, and online. On ground, it decided to organize events, enter tie ups with other brands and music stores like Planet M (the music store with a youth image promoted by the Times of India group) , and with Catcher with the youth merchandise.

Thus, the challenge in marketing for youth goes beyond a simple product development. It involves continuously researching and customizing the marketing mix on an ongoing basis.

Question 2 (2 of 10 Based on Passage)

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Write in Short

Short Answer▾

What is segmentation?

Explanation

Market Segmentation is the process of dividing a heterogeneous market into homogeneous sub units. The total population of a market indicates only the market size. This, however does not indicate anything more. And the marketer must identify similarities among different groups of customers. It involves dividing a broad market into subset of consumers, business or countries who share common need, interest, and priorities and then strategies are designed and implemented to target the market.

Question 3 (3 of 10 Based on Passage)

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Describe in Detail

Essay▾

Commonly used bases for industrial product markets?

Explanation

Commonly used Bases for Segmenting Industrial Product Markets:

Size of the Customer This has been one of the traditional methods of segmenting industrial market. Based on the size and purchases, we may have:

  • category customers: large buyers
  • category customers medium sized buyers
  • small buyers

Generally, firms have different payment terms, product packaging, and sales call frequencies catch of these customer groups, the size of a customer can help a firm determine its sales potential competitive position in that customer group. This type of segmentation can also help the market correct any imbalances that may exist in his selling efforts.

  • Geographical Location The geographical location of a customer is another basis for segmenting the industrial products market
  • End Use Another way of segmenting the industrial market is by differentiating the end users of the 7 firm՚s product. For a steel manufacturer, some of the end user segments include automobiles, construction, office furniture, and cables. Each of these segments have them characteristics and require a different marketing approach.
  • Buyer Behavior/Motivation or Purchase Criteria Within any specific end use segment, we can further segment the market based on purchase criteria.

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