Class 12 OCM Chapter 8: Marketing

Key concepts: Marketing

Marketing

A key management function of creating, communicating, delivering and exchanging offerings that have value for customers, partners and society. It is both an art and a science.

Market

From the Latin 'mercatus' (to trade). It is where buyers and sellers exchange goods or services for money. Concepts are place, commodity, exchange, area, demand or customer, and digital.

Types of market

Classified by area, time, volume of transaction, importance, nature of goods, regulation and competition. Imperfect markets include monopoly, duopoly, oligopoly and monopsony.

Importance of marketing

It raises the standard of living, gives employment and national income (society); builds awareness, sales and trust (firm); gives choice, quality and satisfaction (consumers).

Functions of marketing

Thirteen functions: research, buying and assembling, planning, product development, grading, packaging, branding, support service, pricing, promotion, distribution, transportation and warehousing.

Standardisation and grading

Standardisation sets standards for size, quality, design and weight to keep uniform quality. Grading sorts products by similar features or quality, mostly farm produce.

Marketing mix

The blend of variables a firm controls to reach its target market. Product marketing mix has 4Ps; service marketing mix has 7Ps (adds people, process, physical environment).

Quick revision: important points

• Market comes from the Latin word 'mercatus'; six concepts of market are given.
• Seven bases of classifying markets: area, time, volume, importance, nature of goods, regulation, competition.
• Imperfect markets: monopoly (one seller), duopoly (two), oligopoly (few), monopsony (one buyer).
• 4Ps by E. Jerome McCarthy (1960); Booms and Bitner added 3 more Ps in 1981.
• Transportation creates place utility; warehousing creates time utility.

Practice MCQs with answers

1. The term 'market' is derived from the Latin word 'mercatus'. What does it mean?

   1. To produce
   2. To trade
   3. To advertise
   4. To store
   Show answer

   Answer: B. To trade
   'Mercatus' means to trade or a place where business is transacted.

2. Which concept of market stresses the buying and selling of goods and services and NOT the place where it happens?

   1. Place concept
   2. Area concept
   3. Digital concept
   4. Commodity concept
   Show answer

   Answer: D. Commodity concept
   In the commodity concept, the process of buying and selling and the commodity itself matter, not the place.

3. Which concept of market insists that exchange must be voluntary, with no fraud, coercion or undue influence?

   1. Exchange concept
   2. Place concept
   3. Demand concept
   4. Area concept
   Show answer

   Answer: A. Exchange concept
   The exchange concept stresses free consent and mutual trust between buyer and seller.

4. Which concept of market grew from e-commerce portals and mobile applications that put buyers and sellers in direct contact?

   1. Commodity concept
   2. Place concept
   3. Exchange concept
   4. Space or digital concept
   Show answer

   Answer: D. Space or digital concept
   Information technology gave rise to the space or digital concept of market.

5. Which concept defines the market as the aggregate demand of potential buyers for a product?

   1. Demand or customer concept
   2. Place concept
   3. Exchange concept
   4. Area concept
   Show answer

   Answer: A. Demand or customer concept
   The demand or customer concept looks at the market from the viewpoint of buyers' needs and demand.

All Class 12 OCM chapters

• Chapter 1: Principles of Management
• Chapter 2: Functions of Management
• Chapter 3: Entrepreneurship Development
• Chapter 4: Business Services
• Chapter 5: Emerging Modes of Business
• Chapter 6: Social Responsibilities of Business
• Chapter 7: Consumer Protection
• Chapter 8: Marketing

Class 12 OCM notes: all chapters