Maharashtra HSC Marketing & Retail Management (Vocational) cheat sheet

Marketing is the process of identifying, anticipating and satisfying customer needs profitably; selling is only one component of it.

Core concepts: need (felt deprivation), want (need shaped by culture and personality), demand (want backed by ability and willingness to pay).

Exchange requires two parties, each with something of value, communication and delivery ability, and freedom to accept or reject the offer.

Marketing management orientations in sequence: production, product, selling, marketing, and societal marketing.

The marketing mix is the set of controllable tools (traditionally the 4Ps) a firm blends to produce the response it wants in the target market.

Difference rule: selling focuses on the seller's need to convert product to cash; marketing focuses on satisfying the buyer's need as the route to profit.

Marketing functions: buying, selling, transporting, storing, standardising and grading, financing, risk bearing, and market information gathering.

Customer value = perceived benefits minus perceived costs; customer satisfaction = perceived performance minus prior expectations.

Relationship marketing aims at repeat purchase and lifetime value rather than a single transaction; the 80:20 rule says a small share of customers often yields a large share of revenue.

Micro environment: company, suppliers, marketing intermediaries, customers, competitors, publics. Macro environment: demographic, economic, natural, technological, political-legal, socio-cultural (PESTLE-style).

SWOT classifies internal strengths and weaknesses against external opportunities and threats; it is a matching tool, not a strategy by itself.

Segmentation variables: geographic, demographic, psychographic (lifestyle, values), and behavioural (usage rate, benefits sought, loyalty status).

Effective segments must be measurable, accessible, substantial, differentiable and actionable.

Targeting strategies: undifferentiated (mass), differentiated (multiple segments), concentrated (niche), and micromarketing (local or individual).

Positioning is the place a brand occupies in the consumer's mind relative to competitors; a positioning statement follows: for [target], [brand] is the [category] that [benefit] because [reason to believe].

Differentiation must be important, distinctive, superior, communicable, affordable and profitable to be defensible.

Perceptual mapping plots brands on two attributes chosen by buyers; white space between clusters can indicate a positioning gap.

Product levels: core benefit, actual product (features, design, quality, brand, packaging), and augmented product (warranty, installation, after-sales service).

Product mix width = number of product lines; length = total items; depth = variants within a line; consistency = relatedness of lines.

Product life cycle stages: introduction, growth, maturity, decline; pricing and promotion normally shift from skimming/awareness in introduction to competitive pricing/reminder advertising in maturity.

Price setting sequence: select objective, estimate demand, estimate costs, analyse competitors, choose method (cost-plus, break-even, value-based, going-rate, sealed-bid), select final price.

Break-even quantity = fixed cost / (price - variable cost per unit).

Place: channel levels describe intermediaries between producer and consumer; a zero-level channel is direct selling.

Channel conflict can be vertical (between levels) or horizontal (between firms at the same level); disintermediation is removal of a channel member.

Promotion mix: advertising, sales promotion, personal selling, public relations, direct and digital marketing; push targets channel members, pull targets end consumers.

AIDA describes the communication sequence: Attention, Interest, Desire, Action.

Five-stage buying process: need recognition, information search, evaluation of alternatives, purchase decision, post-purchase behaviour; low-involvement purchases may skip stages.

Information sources: personal, commercial, public and experiential; commercial sources are the most numerous but personal sources are the most influential for many buyers.

Buying roles in a family or organisation: initiator, influencer, decider, buyer, user.

Buyer black box model: stimuli enter, buyer characteristics and decision process operate, observable responses (product, brand, dealer, timing, amount) come out.

Factors affecting consumer behaviour: cultural, social (reference groups, family, roles), personal (age, occupation, income, lifestyle) and psychological (motivation, perception, learning, beliefs and attitudes).

Maslow's hierarchy ascends physiological, safety, social, esteem, self-actualisation; lower needs are generally satisfied first.

Cognitive dissonance is post-purchase discomfort from doubts about a choice; it rises with price and irreversibility, and is reduced by reassurance and after-sales contact.

Perception processes: selective attention, selective distortion and selective retention; these explain why repetition and consistency in messaging matter.

Retailing covers all activities in selling goods or services directly to final consumers for personal, non-business use.

Retail functions: sorting and breaking bulk, holding stock, providing assortment, adding services, and passing information back up the supply chain.

A retailer's core decisions: target market, merchandise assortment, service level, price policy, promotion, and location.

Retail life cycle follows introduction, growth, maturity and decline, with formats evolving as new formats enter at lower cost or higher convenience.

Wheel of retailing: new formats enter as low-price, low-service outlets and gradually trade up, creating room for newer low-cost entrants.

Retail strategy grid (wheel of retailing plus service): margin and service levels must be internally consistent; a high-service promise with low prices is not sustainable.

Key performance indicators: sales per square foot, gross margin return on inventory, stock turnover, shrinkage percentage, and conversion rate (transactions / footfall).

Location decision factors: catchment population, purchasing power, footfall, accessibility, competition density, rent, and complementary stores.

Food-oriented formats: convenience store (small, long hours, limited range, high price), supermarket (self-service, food plus some non-food), hypermarket (very large, food plus general merchandise, edge-of-town).

General merchandise formats: department store (multiple departments, high service), discount store (low price, low service), specialty store (narrow line, deep assortment), and category killer (deep assortment in one category, large scale).

Non-store formats: e-commerce, catalogue and direct mail, vending machines, telesales, and direct selling.

Ownership types: independent store, chain store, franchise, leased department, and consumer cooperative.

Store operations tasks: opening and closing routines, cash handling, stock replenishment, planogram compliance, staff rostering, and customer complaint handling.

Shrinkage = book stock minus physical stock; main causes are theft (internal and external), supplier fraud, and administrative or paperwork error.

Queue management levers: staffing to peak footfall, express counters, self-checkout, and single-queue-multiple-server design.

Franchising: the franchisor supplies brand, system and training; the franchisee supplies capital and local management and pays fees or royalty.

Merchandise planning balances assortment breadth (number of categories) against depth (variants per category) within a budgeted inventory investment.

Assortment dimensions: variety, breadth, depth, and consistency; a deep narrow assortment suits specialty stores, a broad shallow one suits discount and hypermarket formats.

Merchandise hierarchy: department, category, sub-category, SKU; category management treats each category as a strategic business unit.

Buying cycle steps: forecast sales, plan assortment, select vendors, negotiate terms, place orders, receive and allocate to stores, review sell-through.

Sell-through rate = units sold / units received (or opening stock plus receipts) x 100; markdowns are taken when sell-through lags plan.

Visual merchandising elements: window display, mannequins, point-of-purchase material, signage, lighting, colour blocking, and props.

Visual merchandising principles: sight lines and eye-level shelving for high-margin items, colour and size gradation, repetition for impact, and clean sight lines into the store.

Grid layout suits supermarkets (efficient, high product exposure, functional); free-flow layout suits fashion and specialty stores (browsing, longer dwell time); racetrack/loop layout guides shoppers past multiple departments.

Planogram: a diagram specifying product placement, facings and shelf space by SKU; it is used for compliance checks and space productivity.

Pricing approaches: cost-plus (markup on cost), keystone (double the cost), manufacturer suggested retail price, competitive pricing, and psychological pricing (odd pricing, price ending in 9).

Markup percentage on cost = (retail price - cost) / cost x 100; margin percentage on retail = (retail price - cost) / retail price x 100. The two bases give different numbers.

Markdown percentage = (original price - new price) / original price x 100.

High-low pricing uses frequent promotions from a high base price; everyday low pricing (EDLP) holds consistently low prices with few promotions.

Loss leaders are priced below normal margin to drive footfall, and must be supported by profitable attached purchases.

Price bundling, multi-buy offers, and seasonal clearance are common retail promotional tactics; each has a margin cost that must be planned.

Sales promotion tools: discounts, coupons, loyalty points, free samples, contests, and point-of-purchase displays.

Service quality dimensions (SERVQUAL): reliability, responsiveness, assurance, empathy, tangibles; reliability is usually rated the most important by customers.

Service recovery rule: fix the problem quickly and fairly; a well-handled complaint can raise loyalty above the pre-complaint level.

Customer lifetime value = average purchase value x purchase frequency x customer lifespan, used to justify retention spending.

Inventory costs: holding (carrying) cost, ordering cost, and stock-out cost; total cost is minimised where ordering and holding costs balance.

Economic order quantity (EOQ) = square root of (2 x annual demand x ordering cost per order / holding cost per unit per year).

Reorder point = average daily demand x lead time in days, plus safety stock.

Safety stock covers demand and lead-time variability; higher service-level targets require larger safety stock.

Stock turnover (inventory turnover) = cost of goods sold / average inventory at cost; days of inventory = 365 / turnover.

Valuation methods: FIFO (first in, first out), LIFO (last in, first out), and weighted average cost; FIFO is typical for perishables and fashion.

Supply chain flows: product flows downstream, information and cash flow upstream; bullwhip effect is demand distortion amplified up the chain.

Logistics components: order processing, warehousing, inventory management, transportation, and reverse logistics for returns.

Just-in-time reduces holding cost but raises vulnerability to supply disruption; cross-docking moves goods from inbound to outbound with minimal storage.

E-commerce models: B2C, B2B, C2C (marketplace), and D2C (brand sells directly, bypassing intermediaries).

Omnichannel retail integrates store, web, app and marketplace so the customer sees one inventory and one brand experience; multichannel runs separate channels that may not be integrated.

Common omnichannel services: buy online pick up in store (BOPIS), click and collect, ship-from-store, and unified returns across channels.

Digital marketing tools: search engine optimisation (SEO), paid search, social media marketing, content marketing, email marketing, affiliate marketing, and influencer marketing.

Key digital metrics: click-through rate (CTR) = clicks / impressions; conversion rate = conversions / visits; customer acquisition cost (CAC) = total acquisition spend / new customers acquired.

Return on ad spend (ROAS) = revenue from ads / ad spend; a ROAS below the reciprocal of the gross margin destroys profit.

Showrooming is in-store browsing followed by online purchase; webrooming is online research followed by in-store purchase.

Phygital retail blends physical store experience with digital tools such as QR codes, virtual try-on, and self-checkout apps.

Social commerce sells through social platforms; live-stream selling and shoppable posts shorten the path from discovery to purchase.

The 4Ps are controllable; the marketing environment is uncontrollable and must be adapted to.

Marketing myopia is defining a business by the product rather than by the customer need it satisfies (for example, a railway company seeing itself as being in railways rather than transport).

The production concept assumes availability and low price drive demand; the product concept assumes quality alone sells; both risk ignoring actual customer needs.

Societal marketing balances company profit, consumer wants and long-run social welfare.