BABU BANARASI DAS

NORTHERN INDIA INSTITUTE OF TECHNOLOGY, LUCKNOW

MBA 2 YEAR – MODEL PAPER
nd
ACADEMIC SESSION 2023-24 (ODD SEMESTER)
Marketing Analytics (KMBNMK02)
Time: 3 hrs Max Marks: 100
NOTE: Attempt all sections
SECTION A
Q01. Attempt ALL questions in brief: [10x02 =20]
Question Mark CO BTL
s
1A Define Marketing Analytics. 2 1 I
1B Define Market Sizing. 2 1 I
1C Define Pricing Analytics. 2 2 II
1D What is power demand curve? 2 2 II
1E Name the various factors considered for sales forecasting. 2 3 I
1F What are the different types of elements of a good sales forecasting? 2 3 I
1G What is market segmentation? 2 4 II
1H What is positioning? 2 4 II
1I What is advertising analysis? 2 5 I
1J What is retail space planning? 2 5 II
SECTION B
Q 02. Attempt any THREE of the following: [03x10 =30]
Question Marks CO BTL
2A Discuss the different sources of Data in marketing analytics. 10 1 II
2B What is price optimisation? Explain. 10 2 II
2C What do you mean by time series analysis? Explain its components. 10 3 III
What is product
2D positioning. positioning? Discuss the various ways to achieve great product 10 4 III
2E Briefly explain the various types of Store Layout and Design. 10 5 II
SECTION C
Q03. Attempt Any One of the Following: [01x10 =10]
Question Marks CO BTL
3A Explain the different steps to estimate the market size. 10 1 II
3B Write down PESTEL Analysis in detail. 10 1 II
Q 04. Attempt Any One of the Following: [01x10 =10]
Question Marks CO BTL
4A What do you mean by Price Bundling? Explain. 10 2 II
4B What are the advantages and disadvantages of bundle pricing? 10 2 III
Q 05. Attempt Any One of the Following: [01x10 =10]
Question Marks CO BTL
5A How regression model can be used in sales forecasting? Explain. 10 3 III
5B What do you mean by Conjoint Analysis? How does it work? Discuss. 10 3 II
Q 06. Attempt Any One of the Following: [01x10 =10]
Question Marks CO BTL
6A What is customer value? How it can be measured? 10 4 II
6B Briefly explain all the steps of segmentation process. 10 4 III
Q 07. Attempt Any One of the Following: [01x10 =10]
Question Marks CO BTL
7A Describe the relationship between sales and marketing. 10 5 II
7B What is online advertising? Discuss its various types with examples. 10 5 III
 BABU BANARASI DAS
NORTHERN INDIA INSTITUTE OF TECHNOLOGY, LUCKNOW
MBA 2 YEAR – MODEL PAPER SOLUTION
nd
ACADEMIC SESSION 2023-24 (ODD SEMESTER)
Marketing Analytics (KMBNMK02)
Time:3hrs Max Marks: 100

SECTION A
Q1. Attempt ALL questions in brief:
Answer 1/A) Marketing analytics is the practice of using data to evaluate the
effectiveness and success of marketing activities. Marketing analytics allows you to
gather deeper consumer insights, optimize your marketing objectives, and get a
better return on investment.
Answer 1/B) The "market size" is made up of the total number of potential buyers of
a product or service within a given market, and the total revenue that these sales may
generate. It's important to calculate and understand market size for several reasons.
Answer 1/C) Pricing analytics are the metrics and associated tools used to
understand how pricing activities affect the overall business, analyze the profitability
of specific price points, and optimize a business’s pricing strategy for maximum
revenue.
Answer 1/D) The market demand curve is a graph that shows the relationship
between the price of a product and the demand for that particular product. The price
is typically shown on the Y axis of the graph while the demand is shown on the X axis.
Answer 1/E) Major factors in sales forecasting include business policy, turnover rate,
marketing strategy, quality, and the cost of your products.
Answer 1/F) While data is an intrinsic part of a sales forecast, it is not the only
component. A sales forecast also incorporates CRM software, sales procedures,
sales quotas and targets and a sales pipeline.
Answer 1/G) Market segmentation is a way of aggregating prospective buyers into
groups with common needs and who respond similarly to a marketing action.
Answer 1/H) Market positioning is a variety of strategies used to convey key
differentiators of your product, in comparison to others on the market.
Answer 1/I) Advertising analysis is the process of evaluating and examining a
commercial in order to understand its goal, message, target audience, and
persuasion tactics. Experts use this kind of market research to create captivating and
unique advertising.
Answer 1/J) Retail space planning is the process of designing the internal layout of
retail stores to ensure the best shopping experience for customers and maximise
sales of the products on display.
SECTION B
Q2. Attempt any THREE of the following:
Answer 2/A) Market analysis is a crucial skill for product managers, as it helps them
understand the needs, preferences, and trends of their target customers and
competitors. But where can product managers find reliable and relevant data for
market analysis? In this article, we will explore some of the best sources of data for
market analysis and how to use them effectively.
1. Customer feedback
One of the most direct and valuable sources of data for market analysis is customer
feedback. Customer feedback can help you identify the problems, pain points, and
expectations of your users, as well as their satisfaction and loyalty. You can collect
customer feedback through various methods, such as surveys, interviews, reviews,
ratings, social media, and analytics. However, you need to be careful about how you
design, distribute, and analyze your feedback tools, as they can be biased,
incomplete, or misleading if not done properly.
2. Market research
Another source of data for market analysis is market research, which is the
systematic collection and analysis of data about a specific market, industry, or
segment. Market research can help you understand the size, growth, structure, and
dynamics of your market, as well as the opportunities and threats that exist. You can
conduct market research through primary or secondary sources, depending on your
budget, time, and objectives. Primary sources are data that you collect yourself, such
as surveys, interviews, focus groups, or experiments. Secondary sources are data
that are already available, such as reports, publications, databases, or websites.
3. Competitive analysis
A third source of data for market analysis is competitive analysis, which is the
process of evaluating and comparing your competitors' products, strategies,
strengths, and weaknesses. Competitive analysis can help you identify the gaps,
trends, and best practices in your market, as well as your competitive advantage and
differentiation. You can perform competitive analysis by using various tools, such as
SWOT analysis, Porter's five forces, feature matrix, or benchmarking. You should also
monitor your competitors' online presence, such as their websites, blogs, social
media, reviews, and ratings.
4. Industry analysis
A fourth source of data for market analysis is industry analysis, which is the study of
the external factors that affect your market, such as the economic, political, social,
technological, environmental, and legal aspects. Industry analysis can help you
assess the attractiveness, stability, and risks of your market, as well as the
opportunities and threats that arise from the changes and developments in your
industry. You can conduct industry analysis by using various frameworks, such as
PESTEL analysis, Porter's diamond, or industry life cycle.
5. Data analysis
A fifth source of data for market analysis is data analysis, which is the process of
transforming, modeling, and interpreting data to extract meaningful insights and
conclusions. Data analysis can help you measure, monitor, and optimize your product
performance, customer behavior, and market trends. You can use various techniques,
such as descriptive, inferential, predictive, or prescriptive analytics, depending on
your goals and questions. You can also use various tools, such as spreadsheets,
databases, dashboards, or visualization software, to organize, manipulate, and
display your data.
6. Market validation
A sixth source of data for market analysis is market validation, which is the process of
testing and validating your product idea, concept, or prototype with your target
customers and stakeholders. Market validation can help you evaluate the feasibility,
desirability, and viability of your product, as well as the feedback and suggestions for
improvement. You can conduct market validation through various methods, such as
MVPs, prototypes, landing pages, beta testing, or user testing. You should also define
and track your key metrics, such as conversion, retention, or revenue, to measure
your market validation results.
Answer 2/B
Price optimization
Price optimization allows businesses to make informed decisions based on customer
and market data to find the most effective price point. Using data, instead of guesses,
businesses can price their product or service to attract customers, therefore
maximizing sales or profitability.
But why would you want to focus on this method, aside from the obvious? The goal of
price optimization enables you to find the perfect balance between various KPIs and
differing price stages.
Each product or service will have three major price stages: the initial price, the
discounted price, and the promotional price. Let’s explore these further.
Initial price
The initial price is what your customer will see first and be part of the basis of their
first impression. With the data in mind, starting prices should be optimized to match
the product’s baseline demand without the need for any discounts or promotions.
When setting the initial price, using price optimization works particularly well for
products and services with a secure base of long life-cycle products such as
supermarkets, chemists, office supply stores, and commodities manufacturers.
Discounted price
The discounted price is often used by businesses selling products with a short life-
cycle. These would be in line with changing fashions, seasonal relevance etc. We see
this a lot within the clothing, airline and hospitality industries.
The benefit of this is that businesses can get rid of inventory while also enticing new
customers with lower prices. The precise level of discounts over the life cycle is
critical to the product’s overall profit contribution.
Promotional price
The promotional price is a temporary reduction of price for a product or service to
create a sense of urgency and scarcity, giving a quick sales boost.
When optimizing promotional prices, businesses can introduce customers to a new
product or a bundle to drive sales. This is true of ‘Buy One, Get One Free’ – a well-
used promotional tactic.
Answer 2/C)
Time series
A time series is a collection of data points gathered over a period of time and ordered
chronologically. The primary characteristic of a time series is that it’s indexed or listed
in time order, which is a critical distinction from other types of data sets. If you were
to plot the points of time series data on a graph, and one of your axes would always
be time.
Time series metrics refer to a piece of data that is tracked at an increment in time. For
instance, a metric could refer to how much inventory was sold in a store from one day
to the next.
Time series data is everywhere, since time is a constituent of everything that is
observable. As our world gets increasingly instrumented, sensors and systems are
constantly emitting a relentless stream of time series data. Such data has numerous
applications across various industries. Let’s put this in context through some
examples.
Examples of time series analysis:
 ● Electrical activity in the brain
● Rainfall measurements
● Stock prices
● Number of sunspots
● Annual retail sales
● Monthly subscribers
● Heartbeats per minute
Components of Time Series

Secular Trend
It indicates the long-running pattern identified from the chain of data recorded. It can
be increasing or decreasing, indicating the future direction. Although it is commonly
known as an average tendency of any aspect, the trend may vary in specific parts
oscillating between upward and downward. Still, the overall trend will depict a single
movement only, either upward or downward. For example, in summer, the
temperature may rise or decline in a day, but the overall trend during the first two
months will show how the heat has been rising from the beginning.
Seasonal Trend
Seasonal variations represent the presence of rhythmic patterns. Certain pattern
repeatedly occurs at the same period or point every year. For example, the sale of
umbrellas increases during the rainy season, and air conditioners increase during
summer. Apart from natural occurrences, man-made conventions like fashion,
marriage season, festivals, etc., play a key role in contributing to seasonal trends.
Cyclical Variations
It represents a cyclical pattern composed of up and down movement. It may span
more than one year and go from phase to phase to complete a cycle. A business
cycle is a significant example of a cyclic variation, denoted that a business goes
through four stages in its life. Starting from the introduction, expansion, prosperity,
and decline. How well the company can perform and stretch its phases depends on
its performance.
Irregular Variations
It refers to variations that are uncontrollable and inevitable. It occurs randomly,
opposite to regular changes or occurrences, and does not associate with a pattern.
These fluctuations are unpredictable and unexplainable. Forces like natural and man-
made disasters can trigger irregular variations.
Answer 2/D)
Product Positioning
Product positioning is about defining where your product stands in the marketplace.
It involves showcasing the unique features that make your product exceptional and
communicating why it’s better than competing alternatives.
Imagine it as your product’s identity, personality, and the role it plays in consumers’
lives. Whether you’re introducing a groundbreaking innovation or entering an existing
market, positioning your product is your compass for navigating the competitive
landscape.
Importance of product positioning
Here are some key reasons highlighting the importance of product positioning:
● Differentiation

A crowded marketplace with numerous products and brands helps your offering
stand out. It highlights what makes your product unique, whether it’s a distinctive
feature, superior quality, or a compelling brand identity. Without differentiation, your
product may get lost in the sea of alternatives.
● Competitive advantage

A well-executed positioning strategy can give you a competitive advantage. It allows

you to occupy a space in the market that is distinct from your competitors, making it
harder for them to replicate your success. Consumers are more likely to choose your
product when they perceive it as the best solution.
● Brand building

Product positioning is integral to brand building. It helps create a consistent brand

message that resonates with your intended audience. Over time, this strengthens
your brand’s identity, fosters trust, and enhances brand recognition.
● Customer loyalty

When you effectively communicate your product’s value and how it fulfills the needs
of your customers, you build loyalty. Satisfied customers are more likely to return for
repeat purchases and become advocates for your product.
● Product development

It influence product development. It guides decisions about product features, quality,

and design to align with the desired position in the market. This ensures that the
product meets or exceeds customer expectations.
● Risk mitigation

Effective product positioning reduces the risk of market failure. When you thoroughly
understand your target customer and their needs, you are less likely to invest
resources in products that won’t resonate with consumers.
Challenges of product positioning
While it offers numerous benefits, businesses may encounter several challenges:
● Competition: In a crowded market, differentiating your product from
competitors can be challenging.
● Limited resources: Smaller companies may have limited resources for
marketing and branding, making effective positioning more difficult.
● Changing market conditions: Rapidly changing market conditions may
necessitate adjustments to your positioning strategy to stay relevant.
● Lack of clarity: Without a clear positioning strategy, it can be challenging to
communicate your product’s value to the target customer.
● Misalignment with the target audience: If your product’s positioning doesn’t
align with the needs and values of your audience, it may not succeed.
Answer 2/E)
Types of Store Layouts
Depending on factors like the size of the store and the nature of products that you
sell, a store might benefit from some layouts more than others. To find the layout
that's best for you, it's helpful to read about some potential design choices. Here are
six different store layouts that you might want to try:
1. Racetrack layout
The racetrack layout is a loop that takes customers through the store in a large
perimeter. This layout typically features a center display and an array of shelves or
racks on the walls. The racetrack layout can be an effective design in stores that
benefit from showing the customers its entire inventory.
2. Grid layout
A grid layout is ideal for businesses that want to maintain control over their inventory.
This layout features a grid of shelves arranged in a uniform pattern throughout the
store. The grid layout is common in drug and hardware stores, as it makes it easy for
shoppers to find the products that they came for.
3. Diagonal layout
The diagonal layout is similar to the grid layout, but in this configuration, all the
shelves turn diagonally. The diagonal store layout gives customers better visibility of
the items on each shelf and can provide a more open feel to the store. This is an
effective layout for stores that can have a lot of foot traffic, as it's an efficient use of
space.
4. Angular layout
The angular layout incorporates round shapes and curved walls. This layout also uses
a mix of different shelf and rack sizes to highlight premium products. The angular
layout is common in smaller retail locations, as it can highlight the quality of products
rather than the quantity.
5. Geometric layout
Geometric store layouts use sharp lines to produce a modern look. This layout
combines differently sized displays to highlight particular products. The geometric
layout is common in clothing and apparel shops, as it can provide an interactive way
to display articles of clothing.
6. Mixed floor plan
Mixed floor plans combine aspects of both geometric and angular layouts. Mixed
layouts are common in large stores that want to maintain an open floor plan where
customers can browse at their own pace. These layouts use geometric shelves to
display most of the inventory and angular displays to highlight some of the more
premium products.
 SECTION C
Q3. Attempt any One of the following:
Answer 3/A)
Below are the 5 basic steps in estimating market size.
1. Defining the Market
Knowing the level of detail necessary to approach your strategic questions is the key
to properly scoping your market sizing approach. Defining your target market should
always be the first step in estimating market size, and it is critical that you do not
stray from your determined market definition through the data collection process.
Market size can be viewed in terms of Total Available Market (TAM), Served Available
Market (SAM), and Share of Market (SOM). Total Available Market refers to the
combined revenue or unit volume in a specified market. Often a company or investor
will require the market size or Total Available Market for a particular geographic area.
If we take the example of food packaging, the Total Available Market can be
calculated by adding sales of food packaging producers in a particular geographic
region or market segment.
The Served Available Market refers to the
percentage or size of TAM that a company
can reasonably serve based on product,
technology and geographic constraints.
SAM typically will be less than TAM. Using
the same example of food packaging, if the
TAM for food packaging is $200 BN, then
the Served Available Market for companies
making flexible packaging would be only a
percentage of TAM. Lastly, Share of
Market or SOM refers to the percentage of
SAM that a particular company currently
serves or plans to serve. Again, SOM
should be less than SAM except in the
case of a monopoly.
In your market sizing process, start by determining what products or services should
be included as part of your TAM. Then narrow down by geographic scope—US, North
America, Europe, etc. Another factor to consider is the timeframe. Are you looking for
historic market sizing or future projections? By defining what should be included in
your market sizing estimation, your company can more accurately determine the
market potential and the estimated available share of the market.
2. Determining Your Approach
There are two basic methodologies for determining market size: top-down and
bottom-up. Your selected approach may be based on what market information is
available. However, the best approach is to develop market sizing estimations using
both methodologies in order to gain a higher confidence in your estimation.
The top-down methodology uses a broad market size figure and determines the
percentage that the target market represents. For example, to determine the TAM for
food packaging, you might start with retail sales of packaged food and multiply by an
assumed packaging cost (e.g. 10% of the total retail food value is packaging cost). In
general, a top-down approach is typically a quicker, more time efficient approach. It is
great for validation or a quick assessment of market size but seldom will provide the
detail necessary for a true opportunity analysis.
The bottom-up methodology builds the TAM by totaling the main variables of the
target market. Using the same example of food packaging, a researcher might total
the food packaging sales of packaging producers – all food packaging or by package
type or by geography. This method is generally considered to be more accurate and
takes considerably more time to complete. As a result, the bottom-up method is a
more valid estimate because it is less likely to include non-addressable revenue or
units.
3. Selecting Sources
Your selected approach will dictate the necessary sources to estimate market
size. Secondary research or desk research searches for existing data and is the most
commonly used form of research in this type of exercise because it is quicker to
obtain and therefore usually more cost effective. Through general web searching, a
wealth of information can be found at little or no cost. Subscription-based or
syndicated research is a great place to start, but there are also free sources that
contain valuable information. Articles about companies or products in the target
market will often quote data from these sources. You might also check whitepapers
and product announcements for similar information. Publicly held companies are
required to share information in analyst and investor reports. Quarterly and annual
reports are typically available on these company websites as well as through the SEC
filings. Also, trade associations will often conduct market research and aggregate
industry data.
Primary research, also called field research, is often used in addition to secondary
research. The primary research can take on many forms and can strengthen your
understanding of the market, allowing you to make better informed assumptions. The
most versatile form of primary research is in-depth telephone interviews that can be
used to capture more sensitive information. If possible, on-site visits can be used to
confirm or contradict market sizing estimations or determine key information on
market trends, such as technology, market performance, relative competitive position
or other information dealing with understanding scope and defining the target market.
4. Data Structuring—Typology
To further develop your understanding of the market, it is important to gather trend
information, which is typically in the form of qualitative data. This information can
come through secondary research or comments from primary research. If we look at
food packaging, it may be of interest to evaluate trends for specific food segments,
such as dairy, meats/poultry/fish, or beverages. For example, look for trends in beef
packaging that differ from chicken or pork. It may also be valuable to look for trends
in packaging type (cans, cartons, trays, etc.) or fill technology (hot fill, aseptic, ESL,
etc.).
Once the trends information has been collected, you can start structuring data by
group or theme. Typology is the strategy for qualitative data analysis to group
findings into distinct categories in order to identify data themes.

This process allows the researcher to quickly consider the value of information by
comparing with other information in the same “cluster” or “line.” Typology is also
useful for creating a story line as the project moves into analysis stage and the
development of conclusions.
5. Data Analysis
As mentioned above, it is often necessary to develop multiple estimates using
different approaches or sources. This is called triangulation. When multiple sources
or estimations triangulate, the confidence in a market estimate increases. If the
approaches widely differ, additional
research is required to reduce risk and is
recommended to narrow the range of
market sizing estimates.
Common pitfalls or mistakes often start
early on by not properly defining the
market or gathering data from non-
reputable sources. The market definition
should remain consistent throughout the
data collection process and methodology
should be based on market
knowledge—not just demographics.
Where possible, attempt to verify each
significant finding through multiple
published source materials or primary research. By confirming findings, you are able
to leverage the value of various information sources and thus increase confidence in
the final results.
Download our free white paper for more information on the benefits of market
research and how to use market research to better understand your industry.
Answer 3/B)
PESTEL analysis
A PESTEL analysis is a tool that allows organizations to discover and evaluate the
factors that may affect the business in the present and in the future.
PESTEL is an acronym for Political, Economic, Social, Technological, Legal, and
Environment. This unit of analysis assesses these four external factors concerning
the business situation. The analysis examines opportunities and threats arising from
these four factors.
With the results offered by the PEST analysis, it is possible to have a favorable view
when carrying out market research, creating marketing strategies, developing
products, and making better decisions for the organization.
Advantages of PESTEL analysis
Below, we mention the main benefits of carrying out a PEST analysis, one of the
components of market analysis:
● It helps you spot trading opportunities and gives you a warning of significant
 threats.
● It reveals the change of direction within the organization. This helps you shape
your actions to work with the change rather than against it.
● Avoid starting projects that are likely to fail for reasons you can’t control.
● It helps you leave assumptions behind when you enter a new market, allowing
you to develop an objective view of this new environment.
● It provides an overview of all the crucial external influences on the organization.
● It supports more decisive and well-informed decision-making.
● Assists in planning, marketing, organizational change initiatives, business and
product development, project management, and research papers.
Q4. Attempt any One of the following:
Answer 4 A) Price Bundling
Price bundling or product bundling pricing is a pricing strategy where two or more
complementary products are sold together for a price that’s lower than what the
products would have cost individually.
The discounted price motivates consumers to buy the bundle because it’s a better
deal than buying them separately. This leads to increased sales of all the products in
the bundle for the seller.
For example, an art supply store sells a popular canvas for $5, washable paints for
$2 and slow-moving paint brushes for $3, and wooden easels for $3 separately. The
company then decides to create a beginner’s art bundle with all the products for a
discounted price of $10.99.
The customer’s perceived value of the package is higher because it has everything
they need to start their painting hobby. It’s convenient because they don’t have to
look for brushes, canvases, or paints separately. They’re also saving $2, so they buy
the bundle.
On the seller’s side, they’re now able to move the inventory of the slow-moving
brushes and easels together with canvases and paints while still making a profit. It’s a
win-win.
Different price bundling strategies
There are different price bundling strategies or techniques. The type of products
you’re selling will determine which bundling strategy is appropriate for your business.
The two common bundling strategies are pure bundling and mixed bundling.
Pure bundling
Pure bundling is where the products within a package or bundle are only sold
together. You can’t buy one without the others. From our art bundle example, if the
seller only sold the bundle together and not separately, it would classify as a pure
bundle.
Another example of pure bundling is Blue Apron’s subscription meal kits. The kits are
made up of fresh ingredients which you use to create a home-cooked meal based on
your chosen menu. The ingredients cannot be bought separately.
Mixed bundling
With mixed bundling, the products are sold together as a bundle but there’s an option
to buy them separately. Billie sells women’s shaving kits, including the smooth
operator deluxe starter kit. The 5 products in the bundle complement each other to
provide a “full shaving experience”. Buying the products separately on their website
will cost $40.00, but as a kit they sell for $35.
Answer 4/B)
The Advantages of Product Bundling Pricing
Price bundling helps you overcome the challenge of attracting potential clients to buy
certain items or services. It streamlines customers’ shopping experience and
potentially raises average order values through the mix of high-value and low-value
items.
1. Increase Average Order Value
Product bundling can boost the revenues and sales of individual goods over time.
Your average order value will increase if you bundle your products together to
encourage buyers to purchase more things simultaneously. For example: Instead of
buying only one pencil during a single transaction, you can offer customers to buy a
pencil, eraser, and sharpener as a bundle. Letting them purchase more than one
product raises your average order value.
2. Introduce New Products and Attract New Buyers
If you find a popular product among customers, you can put it in a bundle. Combine it
with another product you’re attempting to promote. You can use consumer interest in
one particular item and showcase other things, potentially raising interest in those
items.
Bundle pricing can draw customers looking for deals and discounts or customers
hoping to find complementary items. At the same time, your products may attract
specific customers. New buyers can boost your general popularity among consumers
and increase your revenues.
Making a purchasing decision is easier when you provide your customers with a
curated collection of individual products. When packed together, you give your
customers everything they could want in a purchase.
3. Reduce Marketing Costs
Bundling enables you to sell more and decrease marketing and distribution costs.
Instead of marketing every product individually, you can group complementary
products and market them as a single product. When you package various items
together, you only need one warehouse bin to store them instead of using multiple
ones. Bundling also reduces the number of boxes of individual items you need to ship
and reduces postage costs. Instead of creating print and web advertisements for
each product, you can present them as a package. Doing this lowers your marketing
expenses while simultaneously promoting all of your products.
4. Clear Excess Stock
Merchandise that doesn’t get sold remains in your inventory as dead stock. It adds to
your holding expenses, and eventually ends up as waste. You can use bundling to
clear out dead stock before it becomes a problem. If you package slow-moving or
stagnant items with a faster-selling product, people will consider the bundle deal and
potentially acquire it. This lowers inventory holding costs, decreases waste, and frees
warehouse space.
5. Reduced Risk of Errors
If a bundle includes multiple items, the chance of error is lowered. Delivering separate
goods can increase order and delivery errors. With a bundle, there’s only one
opportunity for a mistake.
Disadvantages of price bundling
While there are several benefits to this strategy, there are also some disadvantages
to consider, including:
Lowers profit on specific items: If a product sells more when it's part of a bundle, the
business may make less in comparison to if customers buy it as a standalone item.
The profit that a business can make on an item may also decrease when people no
longer purchase the bundle it's a part of, but can't buy it separately.
Impacts customer satisfaction: Introducing new products through bundling may not
work if these prove to be unpopular with consumers. Customer satisfaction may
suffer if the buyers feel they are purchasing products they do not want when they
take advantage of these bundles.
Changes the consumer perception: While package deals can attract more customers
to a business, these can affect the way the market perceives the company and its
products. Consumers may start to see the items in bundles as less valuable as they're
not available for purchase individually, potentially lowering the products' reputations.
Q5. Attempt any One of the following:
Answer 5/A)
Regression analysis is a powerful tool for forecasting sales based on historical data
and explanatory variables. It can help you identify the relationships between sales
and factors such as price, demand, seasonality, and competition. However, to use
regression analysis effectively, you need to follow some best practices and avoid
some common pitfalls. In this article, you will learn how to use regression analysis to
forecast sales in the context of operations research (OR), a discipline that applies
mathematical and analytical techniques to improve decision making.
1. Choose the right type of regression model
Depending on the nature of your data and your forecasting objectives, you may need
to choose between different types of regression models. For example, if your sales
data is linear, you can use a simple linear regression model that assumes a straight-
line relationship between sales and one or more explanatory variables. However, if
your sales data is nonlinear, you may need to use a nonlinear regression model that
can capture more complex and curved relationships. Additionally, if your sales data is
discrete or categorical, you may need to use a logistic regression model that can
predict the probability of sales outcomes.

2. Collect and prepare your data

Before you run a regression analysis, you need to collect and prepare your data
carefully. You should have enough data points to ensure the reliability and validity of
your results. You should also check your data for accuracy, consistency, and
completeness. Moreover, you should perform some exploratory data analysis (EDA)
to understand the characteristics and distributions of your data. For example, you
can use descriptive statistics, graphs, and correlation matrices to summarize and
visualize your data. EDA can help you identify potential outliers, missing values, and
multicollinearity issues that may affect your regression analysis.
3. Validate and evaluate your regression model
After fitting your regression model to your data, you need to validate and evaluate it
to make sure it is suitable for forecasting. You can use various methods and criteria
to assess its performance, such as splitting your data into training and testing sets
and comparing the model's predictions with the actual sales data in the testing set.
Other measures of performance include the coefficient of determination (R-squared)
and adjusted R-squared, which measure how well your model explains the variation in
sales. Additionally, you can calculate the root mean square error (RMSE) and mean
absolute percentage error (MAPE) to gauge the accuracy of the model's predictions.
Hypothesis testing and p-values can be used to test the significance of the model's
coefficients and overall model. Finally, you should check the residuals of your model
for normality, homoscedasticity, and autocorrelation using diagnostic plots and tests.
4. Update and refine your regression model
Finally, you need to update and refine your regression model periodically to account
for new data and changing conditions. Monitor its performance over time and
compare it with other forecasting methods. Additionally, consider ways to improve
accuracy and robustness, such as adding or removing explanatory variables based
on their relevance, transforming data or the model to address nonlinearity or non-
normality issues, incorporating seasonal or cyclical effects using dummy variables or
time series techniques, and using regularization techniques to prevent overfitting or
underfitting.
5 B) CONJOINT ANALYSIS :-
Conjoint analysis is a form of statistical analysis that firms use in market research to
understand how customers value different components or features of their products
or services. It’s based on the principle that any product can be broken down into a
set of attributes that ultimately impact users’ perceived value of an item or service.

Conjoint analysis is typically conducted via a specialized survey that asks consumers
to rank the importance of the specific features in question. Analyzing the results
allows the firm to then assign a value to each one.
CONJOINT ANALYSIS USED FOR :-
The insights a company gleans from conjoint analysis of its product features can be
leveraged in several ways. Most often, conjoint analysis impacts pricing strategy,
sales and marketing efforts, and research and development plans.
1. Conjoint Analysis in Pricing
Conjoint analysis works by asking users to directly compare different features to
determine how they value each one. When a company understands how its
customers value its products or services’ features, it can use the information to
develop its pricing strategy.
For example, a software company hoping to take advantage of network effects to
scale its business might pursue a “freemium” model wherein its users access its
product at no charge. If the company determines through conjoint analysis that its
users highly value one feature above the others, it might choose to place that feature
behind a paywall.
As such, conjoint analysis is an excellent means of understanding what product
attributes determine a customer’s willingness to pay. It’s a method of learning what
features a customer is willing to pay for and whether they’d be willing to pay more.
2. Conjoint Analysis in Sales & Marketing
Conjoint analysis can inform more than just a company’s pricing strategy; it can also
inform how it markets and sells its offerings. When a company knows which features
its customers value most, it can lean into them in its advertisements, marketing copy,
and promotions.
On the other hand, a company may find that its customers aren’t uniform in assigning
value to different features. In such a case, conjoint analysis can be a powerful means
of segmenting customers based on their interests and how they value
features—allowing for more targeted communication.
For example, an online store selling chocolate may find through conjoint analysis that
its customers primarily value two features: Quality and the fact that a portion of each
sale goes toward funding environmental sustainability efforts. The company can then
use that information to send different messaging and appeal to each segment's
specific value.
3. Conjoint Analysis in Research & Development
Conjoint analysis can also inform a company’s research and development pipeline.
The insights gleaned can help determine which new features are added to its
products or services, along with whether there’s enough market demand for an
entirely new product.
For example, consider a smartphone manufacturer that conducts a conjoint analysis
and discovers its customers value larger screens over all other features. With this
information, the company might logically conclude that the best use of its product
development budget and resources would be to develop larger screens. If, however,
future analyses reveal that customer value has shifted to a different feature—for
example, audio quality—the company may use that information to pivot its product
development plans.
Q6. Attempt any One of the following:
Answer 6/A) Customer value :-
Customer value is best defined as how much a product or service is worth to a
customer. Here’s how companies can enhance their value to improve the customer
experience and increase satisfaction.
How to measure customer value
Customer value optimization starts with measuring it.
1. Ask customers a small set of questions
2. Determine customer benefits and customer costs
3. Determine if the benefits outweigh the costs
1. Ask customers a small set of questions
To track customer value, you need to communicate directly with your customers. Ask
them how your business is providing value and how it can continue to do so. Many
companies opt to gather customer feedback by sending out regular surveys via email
or by calling customers directly.
First, come up with a small set of questions that will allow you to gauge the value
you’re delivering. For example, you could ask customers how your product or service
helped them achieve their goals or how your company could improve or provide more
value.
2. Determine customer benefits and customer costs
Along with qualitative questions, you should also pose quantitative questions to
evaluate the value of your products or services. To get a sense of perceived value,
you could ask buyers to rate how satisfied they were with their purchase based on a
scale from 1 to 5. Then, you can take the average numerical rating and determine
whether or not your company is delivering high value.
Once you have your feedback, create a list of the ways your team delivers—and
doesn’t deliver—customer value.
3. Determine if the benefits outweigh the costs
Finally, you can start to see whether the benefits (like convenience, quality, and brand
reputation) outweigh the costs (such as price, time investment, and emotional stress).
While it takes time and effort to measure your customer value, the insights you’ll gain
will be invaluable.
Answer 6/B)
Market Segmentation Process
1. Target Audience / Market and The Size of The Market
Identifying the market and the target audience is the foundation for any marketing
campaign. It helps marketers study the type of consumers in the target audience
section and set expectations according to their needs. It helps organize and plan
their marketing strategies as per the size of the target audience’s market and taste.
2. Set Expectations for the Targeted Audience
Once the target audience and size of the targeted audience are identified, it is
necessary to review the needs and requirements of the consumers to meet the
demands and expectations of the consumers.
3. Distinguish the Categories and The Subcategories of Products
Based on the demographic factors of the classification of the consumers, the
marketers must subcategorize the products to fit the requirements of different age
groups, different gender, and so on.
4. Study or Research the Needs and Behavior of the Targeted Consumers
The marketing team must review the needs and preferences of the consumers from
each section of society. It will also be easy to develop a generic marketing strategy if
the requirements of the consumers are studied and reviewed carefully.
5. Strategize the Marketing Campaign
Once the market research of all the necessary factors has been done, and the
marketers have accumulated the consumer interest and their behavior, the marketing
team is all set to strategize their campaign for a particular product or service.
Different advertisements and promotions, banners, etc., are included to promote the
product or the service. The promotion should be done to establish a connection
between the consumer and the product or the service, as the connection is very
important for the campaign’s success.
Market segmentation has been the cornerstone for all successful brands, whether
the company/marketer was a product-based company or a service provider
company. For example, Redmi/Xiaomi has established itself as the market’s most
popular and highest-selling mobile phone brand as they did their homework correctly.
They studied their consumers and their expectations and the consumers’ sensitivity
towards the phones’ pricing. After reviewing the market carefully, they came up with
a successful launch and promotion of the product.
Q7. Attempt any One of the following:
Answer 7/A)
Sales:- Sales is the process of selling goods and services. It involves convincing
potential customers to buy from your company. The convincing can be through
various means such as explaining your product's benefits, offering discounts or
making your product more attractive than that of your competitors. Some common
sales generation methods include making cold calls, holding one-on-one meeting
with business leads, participating in trade fairs and promotional events and cross
selling (selling another product to an existing customer).
Sales is the starting point of a contract between a business and its customers. A
company often looks to retain its customer-base by nurturing a positive relationship
with its customers.
Marketing:- Marketing is the process of making people interested in your product
through various strategies like pricing, packaging, positioning (creating a perception),
placement and promotion. Marketing efforts of a company may or may not focus on
generating direct sales leads, but they definitely intend to make sales easier and
increase revenues over a longer period of time.
For example, marketing teams often work on intangible strategies like creating a
brand image and improving public relations. Having a good brand image may not
generate direct sales leads, but it definitely influences customers to make a purchase
decision in favour of the company's products. Thus, marketing mainly focuses on
analysing customers' needs, interests and behaviour in order to make products more
appealing to them.
Differences Between Sales And Marketing:-
Here are some other differences between sales and marketing:
1. The sales process takes an individualistic, customer-centric, one-to-one approach,
while marketing is media-driven and targets the entire segment.
2. Sales fulfill the demand, while marketing creates a new demand or fits a product
into an existing demand.
3. Marketing focuses on moving the product from the company to the market
(through product launches and awareness campaigns), while sales focuses on
moving the product from the market to the customer.
4. Sales focuses on the needs of the company, while marketing focuses on the needs
of the market.
5. Sales begin where marketing ends.
6. Sales is relationship-driven, whereas marketing is image-driven.
7. Sales requires convincing and conversational skills, while marketing requires
analytical skills.
8. Sales aims at maximising profits, while marketing aims at increasing market share
and customer satisfaction.
9. Marketing attracts the customers towards the product, while sales pushes the
product to the customers.
Answer 7/B)
Online Advertising Meaning :- In the 90s, nobody could have believed that
technological advancement would lead to so many new opportunities. Many fields
have tried to avail these opportunities, and marketing is no different. The process of
obtaining information for purchasing has completely changed for consumers; there is
now so much information online.
Mobile devices like smartphones, tablets, etc., have allowed people to access
information anytime via the Internet. Online advertising has become an increasingly
important tool for companies to market their products/services on these devices. As
a result, companies are allocating more funds for online advertising.
Online advertising refers to the marketing message delivered and seen via the
Internet on search engines, websites, social media, and mobile devices.
Types of Online Advertising
There are many online advertising types, and some important ones are discussed
below. Marketers could run campaigns on any one or simultaneously across all these
types of online advertising.
Content marketing – It generates organic traffic for a website through SEO – search
engine optimization. It is used to deliver a message to the target audience. Another
way to promote content is through paid advertising. Companies pay others to feature
their content on relevant websites.
Social media marketing – Marketing done through social media platforms is called
social media marketing. Facebook, Twitter, Instagram, etc., are all examples of social
media platforms. These sites have analytical tools that help marketers track the
marketing campaigns' performance.
Display ads – These ads appear on third-party websites and are often related to the
information being viewed. These ads are engaging and prompt users to seek
information about them. These ads have evolved rapidly; marketers now use rich
media ads for advertising. Videos, sound, animation, and rich text are used for such
ads.
Mobile advertising – Advertisement appearing on smartphones and tablets is called
mobile advertising. It is done through mobile apps, text messaging, and push
notifications. It aims to get users to click and purchase a product/service.