Marketing Management

Q-1) New product development.

Ans. New product development is a task taken by the company to introduce newer products in the
market. Regularly there will arise a need in the business for new product development. Your existing
products may be technologically outdated, you have different segments to target or you want to
cannibalize an existing product. In such cases, new product development is the answer for the
company. New product development (NPD) is the process of bringing a new product to the
marketplace. Your business may need to engage in this process due to changes in consumer
preferences, increasing competition and advances in technology or to capitalize on a new
opportunity. Innovative businesses thrive by understanding what their market wants, making smart
product improvements, and developing new products that meet and exceed their customers'
expectations.

New products' can be:

• Products that your business has never made or sold before but have been taken to market by
others

• Product innovations created and brought to the market for the first time. They may be completely
original products, or existing products that you have modified and improved.

There are 7 stages of new product development and they are as follows: -

1. Idea Generation

In this you are basically involved in the systematic search for new product Ideas. A company has to
generate many ideas in order to find one that is worth pursuing. The Major sources of new product
ideas include internal sources, customers, competitors, distributors and suppliers. Almost 55% of all
new product ideas come from internal sources according to one study. Companies like 3M and
Toyota have put in special incentive programs or their employees to come up with workable ideas.
Almost 28% of new product ideas come from watching and listening to customers. Customers even
create new products on their own, and companies can benefit by finding these products and putting
them on the market. Example - Pillsbury gets promising new products from its annual Bake-off. One
of Pillsbury's four cake mix lines and several variations of another came directly from Bake-Off
winners' recipes

2. Idea Screening

The second step in new product development is Idea screening. The purpose of idea generation is to
create a large pool of ideas. The purpose of this stage is to pare these down to those that are
genuinely worth pursuing. Companies have different methods for doing this from product review
committees to formal market research. It, is helpful at this stage to have a checklist that can be used
to rate each idea based on the factors required for successfully launching the product in the
marketplace and their relative importance, against these, management can assess how well the idea
fits with the company's marketing skills and experience and other capabilities. Finally, the
management can obtain an overall rating of the company's ability to launch the product successfully.
 3. Concept Development and Testing

The third step in new product development is Concept Development and Testing. An attractive idea
has to be developed into a Product concept. As opposed to a product idea that is an idea for a
product that the company can see itself marketing to customers, a product concept is a detailed
version of the idea stated in meaningful consumer terms. This is different again from a product
image, which is the consumers' perception of an actual or potential product. Once the concepts are
developed, these need to be tested with consumers either symbolically or physically. For some
concept tests, a word or a picture may be sufficient, however, a physical presentation will increase
the reliability of the concept test. After being exposed to the concept, consumers are asked to
respond to it by answering a set of questions designed to help the company decide which concept
has the strongest appeal. The company can then project these findings to the full market to estimate
sales volume.

4. Marketing Strategy Development

This is the next step in new product development. The strategy statement consists of three parts: the
first part describes the target market, the planned product positioning and the sales, market share
and profit goals for the first few years. The second part outlines the product's planned price,
distribution, and marketing budget for the first year The third part of the marketing strategy
statement describes the planned long-run sales, profit goals, and the marketing mix strategy.

Business Analysis-Once the management has decided on the marketing strategy, it can evaluate the
attractiveness of the business proposal. Business analysis involves the review of projected sales,
costs and profits to find out whether they satisfy a company's objectives. If they do, the product can
move to the product development stage.

5. Product Development

Here, R&D or engineering develops the product concept into a physical product. This step calls for a
large investment. It will show whether the product idea can be developed into a full-fledged
workable product. First, R&D will develop prototypes that will satisfy and excite customers and that
can be produced quickly and at budgeted costs. When the prototypes are ready, they must be tested.
Functional tests are then conducted under laboratory and field conditions to ascertain whether the
product performs safely and effectively.

6. Test Marketing

If the product passes the functional tests, the next step is testing marketing: the stage at which the
product and the marketing program are introduced to a more realistic market setting. Test marketing
gives the marketer an opportunity to tweak the marketing mix before the going into the expense of a
product launch. The amount of test marketing varies with the type of product. Costs of test
marketing can be enormous and it can also allow competitors to launch a "me-too" product or even
sabotage the testing so that the marketer gets skewed results. Hence, at times, management may
decide to do away with this stage and proceed straight to the next one:
 7. Commercialization

The final step in new product development is Commercialization. Introducing the product to the
market-it will face high costs for manufacturing and advertising and promotion. The company will
have to decide on the timing of the launch (seasonality) and the location (whether regional, national
or international). This depends a lot on the ability of the company to bear risk and the reach of its
distribution network. Today, in order to increase speed to market, many companies are dropping this
sequential approach to development and are adopting the faster, more flexible, simultaneous
development approach. Under this approach, many company departments work closely together,
overlapping the steps in the product development process to save time and increase effectiveness.

Q-2) product life cycle.

The Product Life Cycle contains mainly four distinct stages. For the four stages introduction, growth,
maturity and decline, we can identify specific product life cycle strategies. These are based on the
characteristics of each PLC stage. Which product life cycle strategies should be applied in each stage
is crucial to know in order to manage the PLC properly.

Product life cycle stages

1. Introduction stage

The introduction stage is the stage in which a new product is first distributed and made available for
purchase, after having been developed in the product development stage. Therefore, the
introduction stage starts when the product is first launched. But introduction can take a lot of time,
and sales growth tends to be rather slow. Nowadays successful products such as frozen foods and
HDTVs lingered for many years before entering a stage of more rapid growth.

Furthermore, profits in the introduction stage are negative or low due to the low sales on the one
hand and high- distribution and promotion expenses on the other hand. Obviously, much money is
needed to attract distributors and build their stocks. Also, promotion spending is quite high to inform
consumers of the new product and get them to try it.

In the introduction stage, the focus is on selling to those buyers who are the readiest to buy
(innovators). Concerning the product life cycle strategies, we can identify the proper launch strategy:
the company must choose a launch strategy that is consistent with the intended product positioning.
Without doubt, this initial strategy can be considered to be the first step in a grander marketing plan
for the product's entire life cycle. The main objective should be to create product
awareness and trial.

To be more precise, since the market is normally not ready for product improvements or refinements
at this stage, the company produces basic versions of the product. Cost-plus pricing should be used
to recover the costs incurred. Selective distribution in the beginning helps to focus efforts on the
most important distributors. Advertising should aim at building product awareness among innovators
and early adopters. To entice trial, heavy sales promotion is necessary. Following these product life
cycle strategies for the first PLC stage, the company and the new product are ready
for the next stages

2. Growth stage

The growth stage is the stage in which the product's sales start climbing quickly. The reason is that
early adopters will continue to buy, and later buyers will start following their lead, in particular if they
hear favorable word of mouth. This rise in sales also attracts more competitors that enter the
market. Since these will introduce new product features, competition is fierce and the market will
expand. As a consequence of the increase in competitors, there is an increase in the number of
distribution outlets and sales are augmented due to the fact that resellers build inventories. Since
promotion costs are now spread over a larger volume and because of the decrease in unit
manufacturing costs, profits increase during the growth stage.

The main objective in the growth stage is to maximize the market share.

Several product life cycle strategies for the growth stage can be used to sustain rapid market growth
as long as possible. Product quality should be improved and new product features and models
added. The firm can also enter new market segments and new distribution channels with the
product. Prices remain where they are or decrease to penetrate the market. The company should
keep the promotion spending at the same or an even higher level. Now, there is more than one main
goal: educating the market is still important, but meeting the competition is likewise important. At
the same time, some advertising must be shifted from building product awareness to building
product conviction and purchase.

The growth stage is a good example to demonstrate how product life cycle strategies are
interrelated. In the growth stage, the firm must choose between a high market share and high
current profits. By spending a lot of money on product improvements promotion and distribution,
the firm can reach a dominant position. However, for that it needs to give up maximum current
profits, hoping to make them up in the next stage.

3. Maturity stage

The maturity stage is the stage in which the product's sales growth slows down or levels off after
reaching a peak. This will happen at some point, since the market becomes saturated. Generally, the
maturity stage lasts longer than the two preceding stages. Consequently, it poses strong challenges
to marketing management and needs a careful selection of product life cycle strategies. Most
products on the market are, indeed, in the maturity stage. The slowdown in sales growth is due to
many producers with many products to sell. Likewise, this overcapacity results in greater
competition. Since competitors start to mark down prices, increase their advertising and sales
promotions and increase their product development budgets to find better versions of the product, a
drop in profit occurs. Also, some of the weaker competitors drop out, eventually leaving only well-
established competitors in the industry.

The company's main objective should be to maximize profit while defending the market share.

To reach this objective, several product life cycle strategies are available. Although many products in
the maturity stage seem to remain unchanged for long periods, most successful ones are actually
adapted constantly to meet changing consumer needs. The reason is that the company cannot just
ride along with or defend the mature product-a good offence is the best defense. Therefore, the firm
should consider to modify the market, product and marketing mix. Modifying the market means
trying to increase consumption by finding new users and new market segments for the product. Also,
usage: among present customers can be increased. Modifying the product refers to changing
characteristics such as quality, features, style or packaging to attract new users and inspire more
usage. And finally, modifying the marketing mix involves improving sales by changing one or more
marketing mix elements. For instance, prices could be cut to attract new users or competitors'
customers. The firm could also launch a better advertising campaign or rely on aggressive
sales promotion.
 4. Decline stage

Finally, product life cycle strategies for the decline stage must be chosen. The decline stage is the
stage in which the product's sales decline. This happens to most product forms and brands at a
certain moment. The decline can either be slow, such as in the case of postage stamps, or rapid, as
has been the case with VHS tapes Sales may plummet to zero, or they may drop to a low level where
they continue for many years. Reasons for the decline in sales can be of various natures. For
instance, technological advances, shifts in consumer tastes and increased competition can play a key
role. As sales and profits decline, some competitors will withdraw from the market.

Also, for the decline stage, careful selection of product life cycle strategies is required. The reason is
that carrying a weak product can be very costly to the firm, not just in profit terms. There are also
many hidden costs. For instance, a weak product may take up too much of management's time. It
requires advertising and sales-force efforts that could better be used for other, more profitable
products in other stages. Most important may be the fact that carrying a weak product delays the
search for replacements and creates a lopsided product mix. It also hurts current profits and
weakens the company's foothold on the future. Therefore, proper product life cycle strategies are
critical. The company needs to pay more attention to its aging products to identify products in the
decline stage early. Then, the firm must take a decision: maintain, harvest or drop the
declining product.

The main objective in the decline stage should be to reduce expenditure. General strategies for the
decline stage include cutting prices, choosing a selective distribution by phasing out unprofitable
outlets and reduce advertising as well as sales promotion to the level needed to retain only the most
loyal customers.

If management decides to maintain the product or brand, repositioning reinvigorating it may be an

option. The purpose behind these options is to move the product back into the growth stage of the
PLC. If management decides to harvest the product, costs need to be reduced and only the last sales
need to be harvested. However, this can only increase the company's profits in the short-term:
Dropping the product from the product line may involve selling it to another firm or simply liquidate
it at salvage value

In the following, all characteristics of the four product life cycle stages discussed are listed. For
each, product life cycle strategies with regard to product, price, and distribution, advertising and
sales promotion are identified. Choosing the right product life cycle strategies is crucial for the
company's success in the long-term
Q-3) price and non-price factors in setting price of product.
Different pricing methods are discussed below: -

1. Cost-based Pricing
Cost-based pricing refers to a pricing method in which some percentage of desired profit margins is
added to the cost of the product to obtain the final price. In other words, cost-based pricing can be
defined as a pricing method in which a certain percentage of the total cost of production is added to
the cost of the product to determine its selling price. Cost-based pricing can be of two types, namely,
cost-plus pricing and markup pricing.

These two types of cost-based pricing are as follows:

(i) Cost-plus Pricing

Refers to the simplest method of determining the price of a product. In cost-plus pricing method, a
fixed percentage, also called mark-up percentage, of the total cost (as a profit) is added to the total
cost to set the price. For example, XYZ organization bears the total cost of Rs. 100 per unit for
producing a product. It adds Rs. 50 per unit to the price of product as profit. In such a case, the final
price of a product of the organization would be Rs. 150. Cost-plus pricing is also known as average
cost pricing. This is the most commonly used method in manufacturing organizations.

In economics, the general formula given for setting price in case of cost-plus pricing is as follows:

P=AVC + AVC (M)

AVC= Average Variable Cost

M=Mark-up percentage

AVC (m)= Gross profit margin

Mark-up percentage (M) is fixed in which AFC and net profit margin (NPM) are covered.

AVC (m)= AFC+ NPM

For determining average variable cost, the first step is to fix prices. This is done by estimating the
volume of the output for a given period of time. The planned output or normal level of production is
taken into account to estimate the output.
The second step is to calculate Total Variable Cost (TVC) of the output. TVC includes direct costs, such
as cost incurred in labor, electricity, and transportation. Once TVC is calculated, AVC is obtained by
dividing TVC by output, Q. [AVC=TVC/Q1. The price is then fixed by adding the mark-up of some
percentage of AVC to the profit (P=AVC+AVC (m)].

The advantages of cost-plus pricing method are as follows:

• Requires minimum information

• Involves simplicity of calculation
• Insures sellers against the unexpected changes in costs

The disadvantages of cost-plus pricing method are as follows:

• Ignores price strategies of competitors

• Ignores the role of customers

(ii) Markup Pricing

Refers to a pricing method in which the fixed amount or the percentage of cost of the product is
added to product's price to get the selling price of the product. Markup pricing is more common in
retailing in which a retailer sells the product to earn profit. For example, if a retailer has taken a
product from the wholesaler for Rs. 100, then he/she might add up a markup of Rs. 20 to gain profit.

It is mostly expressed by the following formula:

• Markup as the percentage of cost= (Markup/Cost) *100

• Markup as the percentage of selling price= (Markup/ Selling Price) *100
• For example, the product is sold for Rs. 500 whose cost was Rs. 400. The mark up as a
percentage to cost is equal to (100/400) *100= 25. The mark up as a percentage of the
selling price equals (100/500) *100=20.
2. Demand-based Pricing
Demand-based pricing refers to a pricing method in which the price of a product is finalized
according to its demand. If the demand of a product is more, an organization prefers to set high
prices for products to gain profit, whereas, if the demand of a product is less, the low prices are
charged to attract the customers. The success of demand-based pricing depends on the ability of
marketers to analyze the demand. This type of pricing can be seen in the hospitality and travel
industries. For instance, airlines during the period of low demand charge less rates as compared to
the period of high demand. Demand-based pricing helps the organization to earn more profit if the
customers accept the product at the price more than its cost.

3. Competition-based Pricing
Competition-based pricing refers to a method in which an organization considers the prices of
competitors' products to set the prices of its own products. The organization may charge higher,
lower, or equal prices as compared to the prices of its competitors.

The aviation industry is the best example of competition-based pricing where airlines charge the
same or fewer prices for same routes as charged by their competitors. In addition, the introductory
prices charged by publishing organizations for textbooks are determined according to the
competitors' prices.
 4. Other pricing methods

In addition to the pricing methods, there are other methods that are discussed as follows:

(i) Value Pricing

Implies a method in which an organization tries to win loyal customers by charging low prices for
their high-quality products. The organization aims to become a low-cost producer without sacrificing
the quality. It can deliver high-quality products at low prices by improving its research and
development process, Value pricing is also called value-optimized pricing

(ii) Target Return Pricing

Helps in achieving the required rate of return on investment done for a product. in other words, the
price of a product is fixed on the basis of expected profit.

(iii) Going Rate Pricing

Implies a method in which an organization sets the price of a product according to the prevailing
price trends in the market. Thus, the pricing strategy adopted by the organization can be same or
similar to other organizations. However, in this type of pricing, the prices set by the market leaders
are followed by all the organizations in the industry.

(iv) Transfer Pricing

Involves selling of goods and services within the departments of the organization, it is done to
manage the profit and loss ratios of different departments within the organization. One department
of an organization can sell its products to other departments at low prices. Sometimes, transfer
pricing is used to show higher profits in the organization by showing fake sales of products within
departments.
Q-4) segmentation and targeting.
Segmentation
Segmentation means to divide the marketplace into parts, or segments, which are definable,
accessible, actionable, and profitable and have a growth potential. In other words, a company would
find it impossible to target the entire market, because of time, cost and effort restrictions. It needs to
have a 'definable' segment-a mass of people who can be identified and targeted with reasonable
effort, cost and time. Once such a mass is identified, it has to be checked that this mass can actually
be targeted with the resources at hand, or the segment should be accessible to the company. Beyond
this, will the segment respond to marketing actions by the company (ads, prices, schemes, promos)
or, is it actionable by the company? After this check, even though the product and the target are
clear, is it profitable to sell to them? Is the number and value of the segment going to grow, such that
the product also grows in sales and profits?

Description: Segmentation takes on great significance in today's cluttered marketplace, with

thousands of products, media proliferation, ad-fatigue and general economic problems around the
world markets. Rightly segmenting the market place can make the difference between successes and
shut down for a company. Segmentation allows a seller to closely tailor his product to the needs,
desires, uses and paying ability of customers. It allows sellers to concentrate on their resources,
money, time and effort on a profitable market, which will grow in numbers, usage and value.

Basis of Segmentation
Segmenting is dividing a group into subgroups according to some set 'basis'. These bases range from
age, gender, etc. to psychographic factors like attitude, interest, values, etc.

1. Gender

Gender is one of the simplest yet important bases of market segmentation. The interests, needs and
wants of males and females differ at many levels. Thus, marketers focus on different marketing and
communication strategies for both. This Type of segmentation is usually seen in the case of
cosmetics, clothing, and jewellery industry, etc.

2. Age group

Segmenting marker according to the age group of the audience is a great strategy for personalized
marketing Mast of the products in the market are not universal to be used by all the age groups
Hence, by segmenting the market according to the target age group, marketers create better
marketing and communication strategies and get better conversion rates.

3. Income

Income decides the purchasing power of the target audience. It is also one of the key factors to
decide whether to market the product as a reed, want or a luxury, Marketers unusually segment the
market into three different groups considering their income. These are: -

• High income Group

• Mid income Group
• Low Income Group
 4. Place

The place where the target audience lives affect the buying decision the mast. A person living in the
mountains will have ess or no demand for ice cream than the peruse lung in a desert

5. Occupation

Occupation, just like income, influences the purchase decision of the audience. A need for an
entrepreneur might be a luxury for a government sector employee. There are even many products
which cater to an audience engaged in a specific

6. Usage

Product usage also acts as a segmenting basis. A user can be labelled as heavy, medium or light user
of a product. The audience can also be segmented on the basis of their awareness of the product.

7. Lifestyle

Other than physical factors, marketers also segment the market on the basis of lifestyle Lifestyle
includes subnets he marital status, interests, hobbies, religion, values, and other psychographic
factors which affect the decision making of an individual.

Targeting

Target marketing involves breaking a market into segments and then concentrating your marketing
efforts on one or a few key segments consisting of the customers whose needs and desires most
closely match your product or service offerings, it can be the key to attracting new business,
increasing sales, and making your business a success. Targeting in marketing is a strategy that breaks
a large market into smaller segments to concentrate on a specific group of customers within that
audience. It defines a segment of customers based on their unique characteristics and focuses solely
on serving them. Instead of trying to reach an entire market, a brand uses target marketing to put
their energy into connecting with a specific, defined group within that market.

Five Different Types of Targeting

1. Behavioral Targeting (aka audience targeting)

Behavioral targeting is the practice of segmenting customers based on web browsing behavior,
including things like pages visited, searches performed, links clicked, and products purchased. If you
add mobile and physical store data into the mix, that can also include things like location, and in-
store purchases. Visitors with similar behaviors are then grouped into defined audience segments,
allowing advertisers to target them with specific, relevant ads and content based on their browsing
and purchase history. An oft cited example of behavioral targeting is retargeting ads.

2. Contextual Targeting

Contextual targeting involves displaying ads based on a website's content. Think: placing an ad for
dishware on a recipe site, or an ad for running shoes on a running forum. It's kind of like the digital
version of placing a print ad in a niche magazine. It works based on the assumption that someone
reading a page about running is likely to also be interested in your ad for sneakers.

3. Search Retargeting
Search retargeting is when you serve display ads to users as they browse the web based on their
keyword search behavior. Campaigns are set up with keywords that you choose and that are relevant
to your business or products. For example, if you are a furniture retailer, you might want to serve
display ads to users who have searched for "leather couch", or "leather sectional". This kind of
advertising is successful because it uses intent to connect with shoppers. The shopper may or may
not know about you, but they are showing interest in a product or solution that you offer. Think of
this as an upper funnel, prospecting strategy.

4. Site Retargeting

Site retargeting, also known as just "retargeting, involves showing display ads to users who visited
your site and then left without completing a purchase to browse elsewhere. It differs from search
retargeting in two important ways: it is not keyword based, and it is targeting people who are already
familiar with your brand, or who at least have visited your site once and showed interest in your
offerings. Because of this brand recognition, the ROI of site retargeting is often extremely high. Think
of this as a lower funnel, conversion focused strategy.

5. Predictive Targeting

Predictive targeting uses all of the web browsing data from behavioral targeting, layers in 3rd party
data (if available), and applies powerful Al and machine learning to analyze the data and predict
future buying patterns based on past behaviors. The Al that powers predictive targeting can make
connections between behaviors, identify similar and related products for upselling and cross-selling,
and zero in on the shoppers most likely to convert at any given time-all in an instant. And the more
data it analyzes, the more it learns and the better its models become.
Q-5) explain the marketing concept and how is it different from selling
concept.
Marketing concept
Core Concept of Marketing

Philip Kotler, the eminent writer, defines modern marketing as, "Marketing is social and managerial
process by which individuals and groups obtains what they need and wants through creating and
exchanging product and value with others." Careful and detailed analysis of this definition
necessarily reveals some core concepts of marketing, shown in Figure.

1. Needs

Existence of unmet needs is precondition to undertake marketing activities. Marketing tries to satisfy
needs of consumers. Human needs are the state of felt deprivation of some basic satisfaction. A need
is the state of mind that reflects the lackness and restlessness situation. Needs are physiological in
nature. People require food, shelter, clothing, esteem, belonging, and likewise. Note that needs are
not created. They are pre-existed in human being. Needs create physiological tension that can be
released by consuming/using products.

2. Wants

Wants are the options to satisfy a specific need. They are desire for specific satisfiers to meet specific
need. For example, food is a need that can be satisfied by variety of ways, such as sweet, bread, rice,
chapati, puff, etc. These options are known as wants. In fact, every need can be satisfied by using
different options. Maximum satisfaction of consumer need depends upon availability of better
options. Needs are limited, but wants are many; for every need, there are many wants. Marketer can
influence wants, not needs. He concentrates on creating and satisfying wants.

3. Demand

Demand is the want for specific products that are backed by the ability and willingness (may be
readiness) to buy them. It is always expressed in relation to time. All wants are not transmitted in
demand. Such wants which are supported by ability and willingness to buy can turn as demand.
Marketer tries to influence demand by making the product attractive, affordable, and easily
available. Marketing management concerns with managing quantum and timing of demand.
Marketing management is called as demand management.

4. Product

Product can also be referred as a bundle of satisfaction, physical and psychological both. Product
includes core product (basic contents or utility), product-related features (colour, branding,
packaging, labeling, varieties, etc.), and product related services (after—sales services, guarantee
and warrantee, free home delivery, free repairing, and so on). So, tangible product is a package of
services or benefits. Marketer should consider product benefits and services, instead of product
itself.

Marketer can satisfy needs and wants of the target consumers by product. It can be broadly defined
as anything that can be offered to someone to satisfy a need or want. Product includes both good
and service. Normally, product is taken as tangible object, for example, pen, television set, bread,
book, etc.

However, importance lies in service rendered by the product. People are not interested just owning
or possessing products, but the services rendered by them. For examples, we do not buy a pen, but
writing service. Similarly, we do not buy a car, but transportation service. Just owning product is not
enough, the product must serve our needs and wants. Thus, physical product is just a vehicle or
medium that offers services to us.

As per the definition, anything which can satisfy need and want can be a product. Thus, product may
be in forms of physical object, person, idea, activity, or organization that can provide any kind of
services that satisfy some needs or wants.

5. Utility (value), Cost, and Satisfaction

Utility means overall capacity of product to satisfy need and want. It is a guiding concept to choose
the product. Every product has varying degree of utility. As per level of utility, products can be ranked
from the most need-satisfying to the

least need-satisfying. Utility is the consumer's estimate of the product's overall capacity to satisfy
his/her needs. Buyer purchases such a product, which has more utility. Utility is, thus, the strength of
product to satisfy a particular need. Cost means the price of product. It is an economic value of
product. The charges a customer has to pay to avail certain

services can be said as cost. The utility of product is compared with cost that he has to pay. He will
select such a product that can offer more utility (value) for certain price. He tries to maximize value,
that is, the utility of product per rupee.

Satisfaction means fulfillment of needs. Satisfaction is possible when buyer perceives that product
has more value compared to the cost paid for. Satisfaction closely concerns with fulfillment of all the
expectations of buyer. Satisfaction releases the tension that has aroused due to unmet need(s). In
short, more utility/value with less cost results into more satisfaction.