Price elasticity income elasticity and cross elasticity

mo boodleary value snapshot income childs play and cross snap beanExplain the model of grab of take up and discuss the factors that determine snap of motivation. Distinguish between scathe gingersnap, income walk e verywhere and cross snap bean of learn and evaluate on their splendour peculiarly to pipelinemen. dissolvents to movement 22.1 Concept of centering of DemandElasticity is a term that was initi whatsoever(a)y highly-developed by sleep withn stintingal scholar called Alfred Marshall, and has been since used in measuring the relationship that exists between crop terms and its standard petiti unrivalledd. It typically fol brokened the law of request that states that the de crocked the value of wells and run, the high the bar that get out be contracted of such(prenominal) goods and services i.e. it generally explains besides the factual directions of trades in the subscribe for the goodness, but non rightfully explaining the extent of t hat permute. A nurture development on these lapses led to the conceit of shot of demands.In practical term, elasticity rigorouss the act of reactivity. Mean eyepatch, elasticity of demand has been theoretically defined as the reactivity of the actual measuring rod demanded of a product to the switch in its actual price. E.K. Estham argued further that elasticity of demand could be defined as the measure of the leg of responsiveness of the quantity demanded to any small change in its price.This measure of the breaker point of responsiveness of the actual quantity demanded of a product to any changes in its price stooge be calculated with the use of the formula belowA good diagram to represent the established moundward colored curve of elasticity of demand could be seen as the incremental changes that be curtilaged in the quantity that is demanded a unyielding the x axis, notably going in the opposite directions that argon relative to these changes in the commodity pr ice along the y axis. infra is figure 1 that aptly depicts the degree of responsiveness of demand due to changes in prices of the commodityThus, vivid observations of the above elasticity of demand complement the simple mathematical presentations of the elasticity of demand as presented above. Notably, the elasticity of demand is commonly expressed as Ed. Diagram 1 above indicates that depending on the actual responsiveness to any changes in prices of commodity, elasticity of demand could be either elastic or springless as seen described through the angles of the above demand curves. Importantly, economist deal argued that the flatter these curves, the more than elastic is the price of the commodity, meanwhile steeper curves result mean the more the price is inflexible.2.2 Factors that determine elasticity of demandBelow ar the important factors that directly or indirectly influence the degree of demand to any small change in price1. Nature of the commodityElasticity has been argued has earlier depending on if the actual commodity to be demanded is a basic necessity, a comfort or a luxury. This is because goods that fall down the stairs the basic necessities of life eat been categorized as having inelastic demand, while those comforts and luxuries goods ar categorized beneath the elastic demand.2. Availability of the substitutes of goods or servicesGoods or services with light(a) substitutes pretend been theoretically and often argued and established as having elastic demand and those goods and services that atomic number 18 without avail suitable substitutes commonly have inelastic demand. Good frameworks of these goods ar coffee and tea that serve as substitutes to each sepa investwise. They are substitutes because a change in the price of tea might progress to deal to switch all over to buying coffee. Alternatively, an development in the price of coffee may to a fault make people shift to buying tea. exclusively a good example of inelastic good is salt because it has no substitute.3. Uses and/or applications of the goods or servicesThe usage of goods or services may affect its elasticity either elastic or inelastic. Good example is electricity, any lower in its price lead planetually led to consumers ability to make more use and further establishing electricity as having elastic demand curve.4. Consumers proportion of the income that is spent on the commodityPractically we have observe that the consumers can fleet only a very small dower of its income in buying such goods. Good example is salt and matches that unremarkably take a very small percentage of consumers income, making them having inelastic demand curve.5. The prices of goodsGenerally speaking, cheap goods and services normally have inelastic demand curve, while the expensive goods normally have elastic demand curve.6. Income of the consumersScholarly arguments have shown that the teeming or high income earners normally have inelastic de mand curves for their goods and services, while the poor or lower income earners normally have elastic demand curve. This is because he rich and high income earners get out buy the goods and services at every aims of its prices, whereas the poor or lower income earners tends to change along the quantity of their consumptions due to changes in price.7. Time boundaryEvidence has shown that elasticity of demand would better occur in the long run production of the goods or services than at the short run. This is primarily because in the long run production and supply processes, the consumers could ad and to their exclusive demands by switching or trying cheaper substitutes. patience express has shown that productions of the cheaper substitutes are only possible only at the long run working(a) processes.8. Income and Wealth Distribution in the night clubThe presence of unequal distributions of the content income would the demand for the goods and services to be relatively inela stic. Most advance countries that befuddle up even distributions of their income and wealth testament make possible elastic demand for its commodity.2.3 Differences between price elasticity, income elasticity and cross elasticity of demandBelow are the third types of elasticity-Price elasticityIncome elasticity is further divided into 3 i.e. Zero income elasticity of demand, Negative income elasticity of demand and Positive income elasticity of demand.Cross elasticity1. Price Elasticity of demandPrice elasticity of demand has been defined as the actual degree of responsiveness of the quantity that is demanded of a good or services in response to the changes in its actual price i.e. price elasticity of demand primarily measures how a great deal of a change in actual price of any good that affects the demand for these goods or services, leaving all different factors to be constant. To calculate price elasticity, there is need to divide the proportionable of change in the quant ity that is demanded by the proportion of change in the price.EP= circumstances change in the quantity demandedPercentage change in the price2. Income elasticityIncome elasticity of demand has been argued as measuring how much of a change in consumers income that affects the demand for such goods or services if its price and all other factors remained constant. Below is the formula for calculating income elasticity of demandEY= Percentage change in the quantity demandedPercentage change in the incomeAs divided into three, Zero income elasticity shows that a change in the consumers income volition have no significant effect on the quantity that is demanded of such goods. Good examples are salts, matches and cigarettes. Next is negative income elasticity that shows that an increase in the incomes of consumers exit lead to the decrease in the quantity that is demanded of such goods. This office mostly occurs in inferior goods. Last is commanding income elasticity that means an inc rease in the incomes of consumers give lead to the increase in quantity that is demanded of such goods.3. Cross elasticityCross elasticity of demand measures the actual change in the demand for commodity A due to the change in the price of commodity B.ED= Percentage change in the quantity that is demanded of commodity APercentage change in the price of commodity BThe above formula indicates that if the goods or services that have substitutes and cross elasticity are positive i.e. as above any increase in price of commodity X exit finally result in the increase in gross revenue of commodity Y.2.4 Importance Elasticity of Demand to businessmen.As evident above, the concept of elasticity of demand has been playing a vital role in the decision making processes of the business human, especially as it relate to hole commodity prices with the aim of making larger profits. Good example is if the address of production tends to be increasing the association entrust take to last this rising hail to the consumers through raising the price of the commodity. Practical examples have a like shown that around companies do change their commodity price even without any visible change in the actual cost of their productions. But practically, whether the raising price is following any rise in the cost of production or otherwise has proved to be beneficial depends on the following situationsThe actual price elasticity of the demand for such goods or ser product, i.e. the percentage change is subject to how high or low the proportionate changes in its actual demand relate to the percentage change in commodity price.The price elasticity of the demand is as well as very applicable for business in determining the value of their substitute, this is because when the commodity price increases the actual demand for the product substitutes also increases automatically even if the products prices generally remained unchanged.businessmen are also able to know that increasing the price of their goods would only be beneficial ifThe demand for their products is less elasticThe demand for their products substitutes is also much less elastic.Finally, the usefulness of elasticity of demand also stands in its ability established the required quantitative relationships that exist between the quantity demanded of a product and its price or any other determinants of demand.Question 4 Discuss some of the characteristics of the Malayan thriftiness. Discuss some of its weaknesses and refer some appropriate policy proposals to strengthen the delivery in rule to enable it to become a developed prudence by 2020.Solution to Question 44.1 Characteristics of the Malaysian saving.Malaysia is one of the countries located in the southeast Asia. The neat is called Kuala Lumpur. Malaysia comprised of two personas, one part is the Peninsular Malaysia and while the other is the atomic number 99 Malaysia which is called Malaysian Borneo. The Peninsular part has 11 states while the East Malaysia comprises of 2 states. Malaysian frugality dodge is an open economy frame the scotch involves domestic community and the international community. More so the economy is a state oriented grocery economy. The re prevalent has a prompt growing economy. The economy was ranked 3rd largest among the south East Asiatic countries in 2007. Where Malaysia suited is a great advantage for its contrary trade.Malaysia gross domestic productThe Gross Domestic Product of Malaysia depends solely on its unpolished, manufacturing industries and the service welkins.The agricultural sphere contributed 9.7 % to the country gross domestic product in 2007. Also in the bowl of manufacturing industries it contributed 44.6% to the country and t of service sector contributed 45.7 % as well to the GDP. For the uvulopalatopharyngoplasty (Purchasing Power Parity), the country is ranked 29th in the world. They have GDP harvest tempo of 20 % and it was realized towards the end of 20th century. In 2009 GDP of Malaysia was estimated US$ 207,400 jillion PPP was calculated to be $ 3.9 billion.Malaysia ingrained ResourcesMalaysia is rich natural resource, like agriculture, minerals and forestry. Most agricultural plant resources of Malaysia are rubber, pine apple, palm oil tobacco etc. The countrys economy In the area of Forestry, the loggings contributed a larger amount to the countrys economy. More so, in the plantation area is timber, rubber plant and palm tree. When we talk of minerals resources, Malaysia is a rich deposit of minerals like tin and petroleum.Sectors of Malaysia EconomyMalaysian IndustriesMining perseverance Malaysian EconomyMalaysia mining industry has contributed a lot to the economy through the export of mine products. The most important ones are oil, waste and tin. Malaysia was ranked has the worlds largest producer of tin in 1980. The sea transportation was easy because the mine is located in location of the mines in the peninsula r Malaysia. blunt oil production and natural gas has change magnitude to a higher(prenominal) level over the last few years. In 1999, the overall production of petroleum reached 693,000 barrels. Production of liquefied natural gas was estimated to be 3.8 billion cubic feet. in that respect are major oil refiners in MalaysiaManufacturing Industry Malaysian EconomyIn Malaysia there are many developed manufacturing industries. The manufacturing industries of Malaysia are, electronics manufacturing industries, furniture manufacturing industries and Food processing industries etc. In the sector of manufacturing, the country is ranked in the 23rd position in the world countries.Malaysian ServicesMalaysian Tourism Malaysian EconomyMalaysia in the sector of tourism was ranking the 9th position in the world. The common tourism locations in Malaysia are Kuala Lumpur, Sabah, Perlis, Malacca, Terengganu etcBanking and FinanceThe bank Negara Malaysia is in charge of finance sector. schoolma ster Plan was introduced in 2001 after the 1999 financial crisis and this gave more room for to Muslim banking. May Bank is said to be the largest bank in Asia peace-loving that practice Islamic Banking. However Malaysian organisation plan to give licensure to more sectors by the end of 2010 to improve the opportunities of Islamic Banking.4.2 Some Weaknesses in Malaysian economy.4.2.1 Political WeaknessIn Malaysia Malay half of the commonwealth holds the constitutionally position in society, and this a kind of discrimination among the three race, this is not only in jobs but in wealth as well. Controversial Internal Security Act (ISA), give room for hold without trial, has been abuse by the presidency on many occasions with goal of quelling unrest. More so, some of the detentions presidential term used it to oppress the politics opposition.BMI Political Risk RatingsThe Malaysias short-term political risk rove (STPR) of 80.2 shows higher compared to other regional countr y like Indonesia, Philippines and Thailand. As the opposition to Pakatan Rakyat ever challenges the BN coalition being witnessed in the defeat of the 2010 budget bill in parliament in 2009, the people thought that general political stableness will be maintained. However, it is encourage that Malaysia was able to maintain a imperturbable political environment, but this all depend on Prime rector Najib Razaks his straight to encourage unity in the nation with diverse ethnicity and faiths.4.2.2 economicalal WeaknessMalaysias is becoming importer of oil in the next few years, Malaysia economic openness will be as much of a interference as a benefit, because of it confirmations of a high level of vulnerability to world(a) suppuration and ceiling flows. The revenuees collected on oil contribute over 40% of the states revenues despite the fact that it was expected to become a net oil importer by the beginning of 2011. Because the government had difficult in having substitute(a) income, this will make hard for the governments function perfectly and maintain economic development, which is potentially leading to stagnate economy.BMI Economic Risk RatingsIn the foregoing quarterly report Malaysias STER rating has being declining to be 73.5. And silent Malaysia is still in the respectable V-shaped recovery of 4.1% now the 2009.The actual GDP harvesting is1.7%), never the less Malaysia is exposed to a Chinese double-dip slowdown, most especially if Beijing was unable to diffuse the satisfactorily recent property gurgle in the near future. Malaysia in addition, has a huge fiscal dearth that is over 7% of GDP in the year 2009 and this has bring the LTER rating down to 72.6.4.2.3 Business purlieu WeaknessThe country will spare price subsidization will a peripheral and it has become part of the economy dust or economy life of Malaysia. Some of the salient construction project and contract for foreign firm are all under the domain of formal Prime Minister Ma hathir Mohamed so they are not directly connected to the government. In order words piquant in businesses in the country will evermore mean doing businesses with the politically connected people.BMI Business Environment Risk Ratings andmore, in (BER) Business Environment Rating Malaysia scores over average which is 63.4 but the score was dragged down because of the comparatively low score of 55.3 for the Infrastructure subcomponent like public transportation, mean while, in 2009 a reduction in the amount of red memorialise boosted the Institutions subcomponent to a score of 66.9 from 59.4.4.3 Some policy proposals to strengthen Malaysian economy.There is a recommendation policy which must(prenominal) be followed accompanied with this, is other improvements in the economy.Firstly there should be huge notification should be on diversification. Most of the Malaysias export markets focused on technology sector and electronics which are vulnerable to global slumps in demand, mostly t he US, the US are major exporter of Malaysian goods. Opening trade of a country economy is an important factor to decide a kind of exchange outrank system that is desirable. If any country relies on trade, the touch on exchange modernize judgment provide stability in the market economy. bothway, when having the exchange rate fixed does not mean the economy will remain competitive in foreign trade when some other countries are faced with pompousness. neer the less it resulted to the second element, the puffiness judge.The inflation rate of the trade cooperator is relevant factor so as the inflation of domestic inflation with the fixed rate in order words the approach is not straightforward. So it is better for the country to remain with the fixed rate to negate inflation tendency in the economy. Another recommendation is labor market flexibility which is used to determine which exchange is better in a given outcome of time. In this respect if there is flexibility in the la bor market, the fixed exchange system work better. There must be flexible labor market and flexible exchange rate in order to avoid unemployment because of the production shock.Further more, the degree of financial development of the country is important. So when a country seems to be financially underdeveloped, fixed exchange rate is better to avoid urge effect of foreign speculation.Lastly is how to decide on which exchange rate system is better, and the mobility of gravid. Mean while, it is better for exchange rate to be flexible when the capital mobility is high. Observation, Malaysias decision in pegging its currency to the dollar seems adequate. With solid financial institutions and apt policymakers, it would be adequate, as well transforming to a flexible exchange rate system.Concludsivly, easing the changings Malaysia will have to persistently implement consistent macroeconomic policies so as to maintain financial stability and sustainable fiscal and external positions.Q uestion 7 fat what you understand by famine financing. What are its limitation as an instrument of economic development. Assuming that you are the economic advisor to the prime minister and he/she ask for your recommendations to take key out a federal official famine, what would you recommend?Solution to Question 77.1 Elaborate what you understand by deficit financing.What do we mean by deficit financing this is a strategy or ways to management of notes which when disbursal is more than collected at the homogeneous period of time. In order words this is referred to budget deficit, this approach is used in business that is small, household budgets, in corporations and also in, governments sector mostly in all the level. If deficit financing is used in the right way it will help oneself to launch a chain of the event and this will help in financing situation instead of any debt may cause problem or difficult to pay. Mostly common or know example of government deficit finan cing is how the government stimulate the economy of that country or nation to put a stop to any recession that country is lining. The government has a set aside a plan which will involved using borrow resources to purchase, the government can use different strategy like increasing demand output for product in all business sector of that nation. It also helps in the motivation of many business in order for them to hire more employees and it will reduced the level of unemployment in the country during the period of recession. Further more, the consumer confidence and trust will be restored in the market place because of the safe transformation, and these make it safe for the buyer to buy more goods and services. If the economy of a country in closely looked into and the deficit financing is cautiously monitored, it will bring back economy stability in the country over short period of time like few month or few years.Deficit spending in economic does not only occurred in the governme nt sector only but also in all business as well A companionship may plan to spend a certain amount of bills as a kind of upfront thinking that they will be able to generate the fund back for investment .An investor or company owner may decide to buy a new motorcar for the company production with the hope that a new machine will hasten and make the production of goods in a less period of time with larger unit of goods, and with less cost. This kind of idea or strategy in business help the business to flourish and the shaper will be able to pay off his debt and have budget surplus instead of deficit, the owner of the business will be debt dissolve and enjoy the surplus.7.2 The limitations of Deficit financing being an instrument of economic development.In any given economy, the government normally embarked many projects that assisted it in generating the desired economy outputs both in investment and other capital projects. If the government prints more cash out it will cause in flation in that economy and this situation usually affected the poor people in that society. The rich will be richer and the poor will be poorer. The buyer straight will be reducing to greater level and the businessmen profit margin will increase. In any society there is always the people that have and those who do not have so any increase made in price domestics goods leads to import of cheap goods and the domestic goods high price will reduced the export. This in turn leads to adverse in balance of payments. Never the less this will affect the cost of the production because the raw material used in process of production has being increased, so the goods will be increased as well, perhaps it will definitely reflect on foreign investment, it will be less attracted by other country. Good example is figure 3 below that aptly depict government spending in OECD countriesSource OECD (2010).Listed below are the disadvantages of deficit financing and some other cogent reasons to be alert a bout a study debt.The raise PaymentIn a society people do not lend to the government with the charity. Government must pay engage on every debt they are involved in just like any one in the society, it was recorded that last year government spent the sum of 31 billon on following payments alone. Looking at this in a perspective manner it will equate to 15 p on income tax. This amount is more than what UK spends on National Defense. The government adoption for the year 2007/08 going to be 42 billion same amount the government pays in re relieve oneself.The Crowding Out effectsThe government debt always affect the mystical sector because they sell bond to the closed-door sector in order for the government to borrow cash and this in turn lead to less private investment because the government has bombard them with the bonds. Also the private spending is more efficient than the government level of spending because the government result to inefficient spending .this is what we c alled crowing out, the private investor is crowded out with government bonds because the government needs to borrowThe financial crowding outThe financial crowding out is when the government want to borrow large sum of money and they tried to increase the interest rate on bonds in order to attract many lender. The bonds rate is increased this will definitely put pressure on the interest rate generally, in order words this increase in the interest rate will affect the economy of that country because people will reduced their way of spending, investment level will be low and later run the economy gain will be low.The tax rises for the future.The tax rises for the future look into how the public sector debt is being paid. Any increasing public sector debts indicated that the future taxpayer will be the one to bear the burden by paying the bill. No matter the situation of the public sector debt reduced or not, the future taxpayer will be the one to pay the interest on the debts. Furthe r this will a problem because, has it was mentioned above, changing of demographics show that government finances is usually place under pressure, though without borrowing from at that moment of time.Limits Fiscal insurance policyIn a normal situation the government should be able expand the fiscal policy in a situation where the economy is facing problem or recession. When a government has urge public debt they tried to reduced the scope by lowering tax in order to enhance demand. Then government must increase taxes and have a go at it their spending in order to meet up with the budget .this is prudent because of the existing problems in the market economy.7.3 Suggested recommendations to eliminate a federal deficitIn summary, I like to recommend these three-step formulas for prosperity1) Elimination of federal taxes.It will good to cancel government taxes because when the citizen gives money to the government is just like throwing coals to Newcastle. Government is the maker of money, they are the producer that has no limitation to their production. . When the citizen sends taxes to the government, they just used it to pay debt. When you send your tax money to the government, the government simply uses it to pay down debt. When paying down debt it destroys the economy money in a given society. In order words taxes discredited money in the society.More so, the federal tax system is a waste of resources, it will be good if the government can spend the billions of dollars spent on compliance on production of useful goods for citizen and this will ease the problem of the economy and the people. The first suggested tax that should be eliminated is the Medicare taxes and social Security taxes. These will be politically popular also regressive taxes directly impact businesses on low and the middle income people. That politician that ends FICA will becomes a hero.This will give federal government the opportunity to create money to support retirement and wellness care sector.2) Elimination of federal borrowing.Government being a producer of money, an established government will not need to borrow money. These are inefficient they are harmful, the mould which provides no economic benefit. The Federal government borrowing provides semantic tactile sensation that government is in debt, and people it find repugnant.If there no borrowing there would not be debt.3) Establishing a national, money-supply goal.It is good to organize a relative, a congress that will look into the checking account called money created, They will add money to this account when needed. They will write checks and make a kind of transfers from the Money Created account in payment for all goods and services.This will be the suggested system for federal money creation in our economy. The congress will be the one to determine on how much money to be added to the Money Created account, however giving Congress power over money creation. Thus, the Federal will continue to co ntrol the interest rates and inflation. The congress will spend what is necessary on retirement, the military health care, crime prevention, education, the infrastructure, and other national needs.The country will be spare the tyranny of semantics and the problem of federal debt. This society prosper has rapid growth in their economy.Question 8 What are the constraints normally countries face in achieving a sustainable economic growth. What are the merits and demerits of attempting to achieve a immediate growth rate in this country.Solution to Question 88.1 Constraints facing the achievement of a sustainable economic growth.As evident in existing literatures that sustainable literally means ability of a system to endure and last long. So, sustainable economic growth means an economic development that is able to last longer According to late David Pearce who kick the bucket to be one of the best environmental economists in his generation, states that sustainable economic growth pr imarily indicates that each of the generation should be able to pass on much of its capital as inheritance to its coming generations, under this Pearce approach he defined capital as including physical capital like machineries and infrastructures, also intellectual capitals like knowledge and technology and in the end environmental capitals like environmental qualities and stocks of the natural resources.This sustainable growth is what the world is witnessing from the groups of emerging economies have been trying all within them to continue to excel, curiously China and India that have remained as major drivers of the recent global expansions.But, evidence has shown that while the recent global growth outlook seems more positive, I will like to use this opportunity to mention that there are major four constraints which could threaten the sustainable growth of any country, i.e.The prices of anele the unpredictable increase in the prices of oil by producing countries have always be en tried to remedy by both the OECD and its other sister organizations such as International Energy Agency all working very add to help many countries in addressing their short and long-term growth challenges as a result of sudden increase in strength prices, problems or fluctuations in security of supply and other alternative sources. If not properly curtailed globally, fluctuations in oil prices could significantly impede economic growth of countries.External imbalances in trades The imbalances in current accounts of trading partners across the earthly concern has reached an unprecedented levels especially between countries like the US, Japan, China, and some other Asian coun

Organisations Motivational Practices and Reward Systems

Organisations Motivational Pr phone numberices and Reward SystemsIn this t direct, what I seduce tried to accomplish is to eff online how an transcriptions wantal practices and rewards systems grass be action with the help of different motivational theories. For any arrangement to be lucky they pauperization to motivate their realiseforce to determine reveal so that they rat perform better, hence providing gauge service to the patients.Over the last one C organisations put one oer been dealing with the problems of having a technical aspect to the business and comparablely a cordial aspect. in that locationfore, it is evident that the requirement of the people (employees) mustiness be fulfilled in order to run a business success well(p)y. in that respect collapse been different motivational theories addressed with various rewards systems. However, here is what I believe that HNT should follow.I would ilk to befool theories of mayonnaise, Maslow and Herzberg to be implemented in HNT for the best possible results. Mayo has talked just around the Theory of humanity dealing that concent numbers on dickens main fixingss that isThe importance of team tend The sense of team purport and doing what the team expected ever more than increases motivation and the same passel be done for Hargreen infirmary. Sm every last(predicate) teams pile buoy be made and relieve oneselfn responsibilities.The engage for managers to take an interest in their workers (Hawthorne effect) If the master shows interest in what their subordinates ar doing and closely communicates thus that gives a sense of importance and boosts up the esprit de corps of the employee.HNT jumper cables to do the same in their organisation.Mayo received some criticism over his possible action as well. It is said that the experiment carried forth by Mayo be far from being scientific. Only groups with sm aloneer number of workers were observed and the later experiments substantiate failed to confirm the regulateings. A nonher occasion that has been pointed out from Mayos conjecture is that the goals of managers depart not be the same as for the worker despite their best effort. Trade may see these efforts as concerns attempt to fool workers into boosting productivity.Maslow on the another(prenominal) hand talks about the power structure of needs. HNT should use this to understand what their employees regard and how potful they provide it to them. The hierarchy is as followsSelf actualisation it means that HNT should arrange gear wheeling, challenges and opportunities to develop the skills of employees. lever needs HNT should give rewards for achievements, promotion and status.Love and be eagle-eyeding needs in that location should be opportunities for teamwork, social facilities and a positive working relationship amongst the employees.Safety needs The organisation must submit original that in that respect argon high standards of health and well(p)ty with job security measures and no bullying culture.Physiological needs Organisations must pay decent salaries to modify the needs of employees to be met. The working hours should be comfortable and so should be the condition.There have been some opponents for Maslows hierarchy as they find the theory unconvincing on various grounds. They argue that any generalisation about levels of human needs is bound to have exceptions. There be fibres where businesses would find that there ar workers who atomic number 18 not interested in gaining plaudit or developing their personal skills. Workers like artists can plane petition for creativity need before financial rewards. Another thing that is to be interpreted into account is that even if Maslows theory is levelheaded, it would be possible for workers to fight all levels of needs at the same study. If a person is satisfactory with his or her salary thus other levels of needs might not be that significant .Herzbergs Two-factor theory is as well something that intrigues me. It has two set of factorsMotivators These motivate the workers by providing job satisfaction includingSense of achievementRecognition of effort fire workResponsibilityHygiene factors Everything that can cause dissatisfaction in the workplace ar consociated to the working environment likeCompany indemnityRelationship with supervisor and colleagues manufacture and statusSecurityA study problem with Herzbergs theory according to several researches has shown that it cannot be applied to all workers in every business. Some jobs like low arch(prenominal) cannot be amended that easily and many workers may not see responsibility or advancement.In the above proveion I have tried to discuss different motivational theories and have illustrated their pros and cons. A mixture of these three motivational theories should be implemented in HNT. Rewards and recognitions twain should be stipulation in the shape of financi al as in some sort of pension or a paid trip to vacation spot sponsored by the connection. Non financial acknowledgement can be given as a promotion or certificate or allowter of appreciation that entrust make the employee feel good about working hard and result make them even more determined and hard working than before.BTEC issue award in transmission lineUnit 16- HUMAN RESOURCE vigilance IN BUSINESSTask 2 (P4)Cooperation through engender of workout and employment involving techniquesIn this section, I get out turn out to show the conditional relation of cooperation in an organisation. The cooperation at any level in any caller needs to be from both ends that is from the management side and the employee side. The two factors that play the most for the cooperation are the contract of employment and the employment involving techniques.For HNT to survive and pull a fashion its good reputation that is being lost at the moment they need to have consent from both sides that is the employer and the employee. With the cooperation of both parties only it is possible to have a successful plan implemented and getting the desired results. tailor of employment Clearly illustrates the terms and conditions to which both employer and employee has to abide by. If one of them violates the constitution thus the contract depart be dismissed. Contracts states the date of beginning with employer and employee secern on it. It understandably shows the responsibilities of both parties and what policies and procedures needs to be followed in the organisation. desire for HNT it will be mentioned that they are bound to pay the stated cadence of salary on the contract to the doctor and if they fail to do so they can be accountable for that. The same goes for the employee if they dont work for the stated occur of hours hence HNT has the honorable to deduct their salaries according or penalise the employee.a foresighted different aspects that are covered in the c ontract, one of the important aspects mentioned is conditions of work and service. In that paragraph says conditions may include the followingThe number of hours to be worked When HNT is signing a contract with its employees the number of hours worked by individuals should be clearly stated. There are some limitations even according to visa policies and the employees should be asked to work within their limits.Appointment and termination The clauses for appointment and termination are also mentioned where the employee and management is addressed to all responsibilities that are required to be adhered. The conditions in which an employee can be terminated are also explicitly mentioned so that when the contract is formed the employee exactly knows about it.The designation of the job The designation for which an employee has been hired in the company will be mentioned on to each one and every contract. If an employee is a heart surgeon then his or her designation will be clearly scrip ted on the contract.Pay What will be the salary of the employee being hired needs to be mentioned. Things like how the salary is paid? Will it be a sanctioned salary or will it also be commission establish? These things should be mentioned for HNT to be on synthetic rubberr side and for the employee as well.Benefits If HNT plans to give out turn a profits to their employee then they should be written in the contract as well. It will tell what benefits are available to the employee and when.Disciplinary procedures This shows what action will be taken by the Hargreen hospital if there is a problem with doctors and nurses or the low skilled workers. Action is taken only if the employees in Hargreen Hospital fail to comply with the disciplinary or organisational rules and regulations or if doctors and nurses do full fill their responsibilities. It is important to Hargreen Hospital because if the doctors and nurses knows what action will be taken for type if it states that breaking rules leads to dismissal, this will encourage doctors and nurses not to break the rules so that they can to retain their job in Hargreen Hospital. It is important to the Hargreen Hospital because it can easily take action if doctor and nurses misbehaves because it was written in the contract. The contract of employment forces the employees to change their behaviour and behaviour according to the rules and regulations of Hargreen Hospital and this case the employee cooperates with the employerNotice If an employee needs to leave the job or if the company is not happy with the performance of an employee there should be a notice catch of at least one month that both the parties of HNT, management and employee, must obey.Grievance procedures If there are complaint or issues by the employees of HNT there should a procedure mentioned in the contract that should guide the employees as to what they need to do to make a point.Employee salutarys All the decentlys that are being have by th e employee must be mentioned in clear words in the contract. If any employee wants to have maternity leave at HNT then it is their right to be given a paid leave and it should be written in the contract.All contracts have some express terms that are normally mentioned in the terms and conditions or the policy and procedure sections. These are the terms that are stated explicitly to make trusted that both parties abide by them. For example the leave system, it can be explicitly stated that an employee cannot take more than 20 days paid leave. There are some implied terms as well that are automatically included to every contract. For example the Data Protection Act. If the company ask the employee to disclose sensitive data like religion, sexual orientation or the employee faces racial discrimination then the company is accountable for that and can be taken to the thatterfly of justice at any time. There are individual labour laws that protect employees fromDiscrimination HNT have to make sure that there is no display of discrimination from their side on the root word of age, race or disability. For example if a patient is discriminated i.e. due to his or her age, gender, race or colour, that patient has the right to report that doctor to court or to the authorities. Hargreen Hospital could then carry out an investigation and also provide further training for the medical staff.Pay All employees doing similar jobs must be paid the same amount of money other than the employee has the right to hold HNT accountable in court.Absences HNT have to make sure they provide paid leave to the employees especially maternity leaves and the employees have the right to ask for these leaves.Dismissay Employees of HNT have the right not to be dismissed on disciplinary action for trade union activity or on health and safety grounds.Health and Safety Regulations The health and safety regulations relate to the physical environment of Hargreen Hospital, relates to aspects like s afety entry and exit routes, safe working environment, and safe equipment which also relates to theory of motivating staff by Frederick Herzberg who believed that employees are only motivated if their hygiene factors are met first and then the organisation can use them to work harder. He believed that if the working conditions in an organisation are unsafe, then the employees will remain demotivated and if the organisation has safe working environment, the safe will be motivated. If doctors in Hargreen Hospital have safe equipments, they will use these equipments effectively to finish their jobs quickly for example during surgery and examinations.All these above stated points will give government agency to both the employer and the employee and provide them a good healthy relation to work in concert that will result in better performance of Hargreen hospital and lesser employee dollar volume rate.Employment involving techniques It is another means of achieving organisational coop eration between the two parties. Its not just the legal binding between the employer and the employee that makes the work together hardly different techniques can be utilise that involves them both to work together. Here are some examplesQuality Circle HNT can define a group of employees (doctors, nurses, technicians etc) under supervision to identify, analyse and solve work-related problems and insert their solutions to management in order to improve the performance of the organization, and motivate and enrich the work of employees.Suggestion scheme The company can also implement a suggestion scheme where all employees will have the right to give in their suggestion regarding a certain problem and then the management will address to it in the best possible way and try to rectify it. Thus ensuring better working conditions and satisfaction to the employees. intercourse groups Different established (finance dept, accounts dept etc) and informal (sports club, charity club etc) g roups can be formed within HNT. These groups can be used often and then to socialise all the employee and management. This will allow the hands to know each other better and will increase the understanding between them. Therefore, it will increase the performance of the workforce and a better repute of HNT.From the above discussion it is understandable that cooperation between the management and the employee is a key factor for the success of HNT. They have to make sure that they abide by the rules and make sure that the communication link between the superior and subordinate is perpetually good and healthy just as said by Herzberg and Mayo in their respective motivational theories.BTEC National Certificate in BusinessUnit 16-HUMAN RESOURCE MANAGEMENT IN BUSINESSTask 2 (M2)Use of motivation theories in Hargreen HospitalIn this section, we will try and compare the use of motivation in an organisation. We will start finish with discussing the different motivations theories that we have discussed earlier and then see how they have managed to locomote the effectiveness of an organisation.The three motivational theories recommended by me to HNT (Mayo, Maslow and Herzberg) can be used at different levels of hierarchy in the organisation. But first let us have a look at the use of motivation.If the motivational theory of Mayo, Maslow and Herzberg is applied to HNT it will definitely reduce the turnover rate and absenteeism as all the needs of the employees will be fulfilled and the coordination of subordinates with their superior will be much better.When the staff is more motivated then they can be used in a much more efficient manner than before. When the employee is provided with good health and safety measures and they know that they are secured they will obviously work better than before.Motivational theories have always emphasised on better relation and understanding between management and staff. Good relation on the basis of motivation can lead to resolving big issues much(prenominal) as industrial relationship issues and problems like strikes. A good motivated team of labourer would never want to go on strike when they know that all their basic necessities are being taken care of by their management.A planned, well deft and flexible workforce can only be built if HNT has a good motivational plan implemented in the organisation. This will benefit the organisation in the retentive run.At this point we can even recommend that HNT can use Mayos theory for all blue pinch workers (porters, drivers etc) as it will provide them the sense of working in teams and would give them the idea of how important it is to have communication with their subordinates and peers.A combination of Herzberg and Maslow can be used for an efficient white collars (nurse, doctors etc) workforce as at this stage most of the staff is skilled or semi skilled and these are the people that HNT would want to retain for a longer plosive of time as they will be spend ing money to train them and they will have the expertise and knowledge that is vital for the companys growth.Last save not the least a combination of all three, Mayo, Maslow and Herzberg can be used for the gold collars (directors, CEO etc) at the top. They are the ones who have to do the decision making. They should be acquainted with each and every aspect of the organisation. Therefore, it is undeniable for them to know about all three motivational theories suggested so that they can implement them all to their subordinates and the process goes on until the last subordinate.BTEC National Certificate in BusinessUnit 16- HUMAN RESOURCE MANAGEMENT IN BUSINESSTask 2 (D1)Ways of improving motivation in HNTIn this section, we will try to suggest how different ways of motivation can be modify and then try to justify them. We will be giving examples where possible to make the point more clear.pickings into account the current situation it can be seen that the morale of the workforce is low at the moment. Due to this reason there is high turnover rate and also is the cause of absenteeism. For this issue Maslows hierarchy and Mayos theory of human relation can do wonders. If self actualisation is provided by the company to enhance the skills of their workforce then HNT will benefit from it in the long run. The more the employees get skilled the more will the service quality increase and thus increase the patient satisfaction rate. This will enable the employees to be motivated as they can be getting promotions for their good work. Thus the employees would not think of leaving HNT. The sense of working in teams will also be a vital player in the motivation of the employees. If the employee work together in teams they get to know their peers and other employees better. They develop better understanding that lifts up the performance of the whole organisation.The long and tedious hours of working and low security has also demotivated the employees. For this purpose Her zbergs two-factor theory is the best solution. A good motivator for the employees at this stage can be giving them interesting work to do. Cut down their long tedious shifts to normal sized shifts and give then different travail every day. Provide them with facilities to relax a bit (the concept of breaks by Taylor can be used at this point). When HNT will do all this it will make the employee feel good about their jobs. Formation of formal and informal groups at this stage will also be adept for the organisation. The Hygiene factor at this point can be providing security to the employees especially to those who work at night. We know that there is high execration rate in that area. No employee would want to work in such a place living is by far out of question. So HNT must try to provide as much security as possible to all its employees so that they are not intimidated at any point of the day while working.As stated there has been a decline in the standards as well. This is also clearly a lack of motivation. There is lot of potential in the organisation but the work force the human element needs to be boosted up. The social aspect of the strategy must be understood and motivational theories at all level from higher, middle and lower level must be implemented in order to regain the good standards that HNT once had.If Mayo, Maslow and Herzbergs theories are implemented in a proper way in HNT the organisation can be up and running within a matter of few days. New recruitment from Poland and Germany will also work as a catalyst in this scenario. New workforce coming from oversea will make the working environment more competitive and employees if given incentive with proper rewards and recognition will strive to do better than ever.Motivation can also be improved among employees by using job rotation at work for example different nurses and doctors can be assigned to observe during surgery so that they can see how surgery is carried out. This gives them time t o have new experiences and also this can act as an educational tour which can improve their skills.Employees can be assigned to perform tasks that porters do for example delivering mails or equipments to surgery room. The organisation uses this type of motivation so that doctors and nurses dont do the same job over and over which leads to boredom.Motivation in Hargreen Hospital can be improved by offering doctors and nurses some incentives for example free parking space, pay travel, vouchers, health insurance schemes, and nursery places for example if they are offered vouchers, it is like way of appreciating their services such instead of paying 5 for a repast in Hargreen canteen, they can only pay half price which is their way of being motivated. Free parking space enable them to free to precipitate in whenever they want because they will not charged for parking which allows them to do extra work for example the low skilled workers can move into in on weekends to clean the hospi tal even doctors and nurses can come in do work on their own without inviting them.Offering nursery places allows doctors and nurses to bring their children to study at Hargreen Hospital which will all them to have spare time that they have been using to go to get their kids from schools but if Hargreen offers nursery places to doctors then they can bring their kids to the hospital in the morn and go back home with them in the evening.

Effect Of Celebrity Endorsements On Brands Marketing Essay

pith Of reputation Endorsements On Brands marketing auditionFriedman and Friedman menti wizardd a repute contributor is an individual who is k instantern by the humankind for his or her achievements in argonas other than that of the fruit class endorsed. repute Endorsements20% of in all advertisements in India are endorsed by celebrities (Prakash, 2012). In encourage of the observation, a question shows that reputation stock- acquire warrants results in much favor fitting advertisement ratings and shuffling evaluations (Dean and Biswas, 2001) and dealister take over a substantial positive impact on financial returns for the companies that ingestion them (Erdogan, 2001). Though, celebrity imprimatur is non a modernistic phenomenon in India, with Hindustan Lever development super stars orderedly for its Lux grime over the grades. The number of celebrities endorsing deformitys has risen significantly in the past 20 eld in India. Celebrities corresponding Sac hin Tendulkar, Amitabh Bachchan and Shahrukh Khan have vex the admans preferred bet.Advertising professionals in India believe that on that point are two situations in which celebrity endorsements can be impelling. Lifestyle crossroads like Raymonds, Vimal etc. where celebrity epitomizes that kind of lifestyle. And in situations where customers are not sure active the growth and testimonials by celebrities tend to provide required assurance. However, in this case the be between the product and the celebrity needs to be perfect. According to capital of Minnesota Nayyar, a celebrity endorsement is used to achieve two ends to yield your products noticed and to show that it is tried and tested. (Prakash, 2012). Some industry insiders believe that a celebrity endorsement is effective plainly when it is in congruence with the product.possibility and practice prove that the use of super stars in advertizing generates a lot of publicity and attention from the public (Ohanian 199 1). One might say that victimization a celebrity in a product/ returns endorsement means guaranteed winner for the steel, but this is not unendingly the case. eon many companies had used a celebrity at one head up or the other to endorse its product/ work, only few of them have been succeederful in building a grunge and generating long bourn r plainues finished the tactic.ObjectiveTo study the phenomenon of celebrity endorsements for Brands and different consumer behavior forges associated with it. turn out the effect of celebrity endorsements on home runs.ApproachA three tincture approach has been taken to achieve the objectives of the study.Literature review to understand the confused theories and phenomenon describing the use of celebrity in advertisements.Survey outline to understand the consumer science of flick of sundry(a) celebrities watchn today in Indian advertising vis--vis the public figure of the blades they endorse.Analyze the performance of these tick offs in the light of their attribute match with their respective(prenominal) celebrities.Survey Analysis Online espouse was designed to gather the consumer perception of the propose of the various celebrities and the kitchen range of their endorsed products. Respondents were shown clips of the advertisements from the past and asked about the recall and likeability of these ads. Link to the measure ishttps//qtrial.qualtrics.com/SE/?SID=SV_ermlGxDswznQJk9Detailed questionnaire is attached here for reference.Assumption Market fate of the brand can be taken as a comely estimator of the performance of the brand when the industry has not seen any major(ip) motleys.4. Literature ReviewCelebrities have been used in advertising since modern nineteenth century and since and so a consider fit amount of research has been done in this domain. Studies on distinction endorsements have been undertaken to cave in initiation credibleness and attractiveness fabrics in advertising . These studies suggest that celebrities exert their influence on consumers through perceived attributes like nearise, trustworthiness, attractiveness, familiarity and likeability (Ohanian 1990, 1991). Another innovation in possibleness which defines the effect of celebrities on brands is termed as the match-up hypothesis. It examines the match (or fit) between the product being endorsed and the celebrity used. According to Kahle and Komer 1985 Kamins 1990 and cashbox and Bustler 2000, match-up hypothesis maintains that an endorsement is much effective when the image or characteristics of the celebrity are hearty matched with the endorsed product.Friedman and Friedman (1979) cerebrate that the break away the celebrity/product fit, as perceived by consumers, the higher the train of endorsement effectiveness. Till and Busler (2000) found that celebrity/product fit was effective for only certain measures of effectiveness such as brand attitude, but not for other measures such as purchase intention.McGuire (1969-1987) said that one of the most reli commensurate effects found in communication research is that expert and/or trustworthy origins are more persuasive than sources that are seen as having less(prenominal) expertise and trustworthiness. The literature likewise implies that celebrities fit appraise through the process of consequence transfer (McCracken 1986, 1989). The meaning transfer model posits that celebrities develop a soulfulnessa through the types of roles they joke in society as well as how they are envisioned in the media. McCracken (1989) inferred that the endorsement effectiveness depends on the meaning that the celebrity brings to the endorsement process. He described the whole consequence Transfer process in three stages. In the initial stage, the meanings generated from distant movie performances, or athletic achievements and performances reside in celebrities. In the second stage, meanings are transferred to the product th rough an advertisement process. In the third stage, the meanings are transferred from the product to the consumer, where the properties of the product become the properties of the consumer.A review of the literature revealed following other key predictors for the success of a celebrity endorsementCelebrity performance It refers to the achievement of a celebrity in their chosen profession. When a celebrity fails to perform acceptably, as defined by consumers, a celebrity endorsers effectiveness tends to decline (Agrawal Kamakura 1995).Celebrity believability Source credibility can be defined as a communicators positive characteristics that affect the receivers acceptance of a message (Ohanian 1990).Celebrity expertise Subjects exposed to a source perceived as expert exhibit more agreement with the sources recommendation than did those exposed to a source with low expertise (Ohanian 1990).Celebrity trustworthiness Miller and Baseheart (1969) found that a highly opinionated message fro m a highly trustworthy communicator produces an effective attitude change, while non-trusted communicators impact be immaterial.Celebrity attractiveness The source-attractiveness model suggests that the attractiveness of any source is determined by the communication receivers perceptions of the sources similarity, familiarity, and likeability. Likeability includes factors like Physical appearance, both(prenominal)bodyality and hearty status. When consumers perceive a celebrity as similar to them and if they are familiar with and like the celebrity, they go forth tend to witness the celebrity more attractive. Joseph (1982) in his study on endorsers attractiveness concluded that attractive endorsers deliver a more positive impact on the products they endorse as compared to less attractive endorsers. Caballero et al. (1989) in his study even observed that endorser attractiveness had no effect on advertising effectiveness. eternal rest TheoryFritz Heider developed proportion Theo ry to show how great deal develop relationships with things and other people in the environment. It says that if people see a set of cognitive elements as being a system, then they will have a preference to maintain a oddmentd press out among these elements. race are motivated to restore a survey of balance if there is discomfort.Fritz Heiders dimension Theory explains the effectiveness of celebrity endorsements when a well-liked celebrity uses a product. The balance theory states that people like balance in their lives and if they have a positive attitude towards a celebrity and they see that celebrity utilise a certain product or service, then they will likely have a positive attitude toward the product or service as well. The Principle of attractive force says that people are more likely to listen to a message from someone they hold attractive. Conversely, a celebrity with a poor image can foothold harm a brand. This phenomenon is explained below in the hazards of us ing a celebrity. conformation Balance TheoryThe crack-up HypothesisLiterature reveals that a example interacts with the type of brand being advertised. According to Friedman and Friedman (1979), a famous person relative to a normalspokesperson is more effective for products high in mental or social risk, involving such elements as good taste, self-image, and opinion of others. Till and Busler 1998, Martin 1996, Till and Shimp 1998 have examined the congruency between celebrity endorsers and brands to explain the effectiveness of using famous persons to foster brands. Results show that a number of celebrity endorsements prove very successful, whereas others completely failed, resulting in the termination of the respective celebrity communicator (Walker et al.1992)The importee Transfer ModelMcCracken (1989) explains the effectiveness of celebrity spokespersons by assessing the meanings consumers associate with the endorser and eventually transfer to the brand. The model suggests three stages. First, the meaning associated with the famous person moves from the endorser to the product or brand. Thus, meanings attributed to the celebrity become associated with the brand in the consumers mind. Finally, in the consumption process, the brands meaning is acquired by the customer. The third stage of the model explicitly shows the importance of theconsumers role in the process of endorsing brands with famous persons. cast Meaning Transfer ModelSource McCracken, 1989 paper on Meaning Transfer ModelCelebrities contain a broad range of meanings, involving demographic categories (e.g. age, gender, status), personality and lifestyle types. Madonna, for example, is perceived as tough, intense and modern women, and is associated with the disdain middle class (Walker et al. 1992).Risk of using CelebritiesThe celebrity may shadow the product being endorsed High ad recall but less brand recall and intentions to purchase. The 1996 BPL ad featuring Amitabh Bachchan is a cla ssic example of the phenomenon. People recalled Amitabh Bachchan more than BPL in the advertisement.The celebrity being overexposed, reducing his or her credibility -Some spokespersons promote more than one brand.eg Golf champion Tiger forest has endorsed Accenture, Rolex, and Nike. Tripp et al. (1994),suggested that endorsing as many as four products negatively influences the celebrity spokespersons credibility and likeability. These effects are independent of the celebrity, i.e. even the most liked stars can fall a prey to this phenomenon. Though these findings are found to be valid, the concept of multiple product endorsements is still prevalent in advertising.The stigma audience may not be receptive to celebrity endorsers Effect of region and culture on the selection of the celebrity for a product. In 2006 saw a surprising move from KSDL which roped in MS Dhoni as brand ambassador to endorse the soap. The purpose was to attract new-made contemporaries. solely it does not go along well and the entire draw proved to be very ordinary.The celebritys behavior may pose a risk to the company Since repeated pairings of a brand and celebrity strengthen the associatory link consumers establish between brand and celebrity, negative information about the celebrity may negatively impact the endorsed brand (ErdoganBaker 2000).Post-scandal, that global consulting securely Accenture dropped timber as a spokesman and Procter Gambles Gillette as well as announced limiting Woods presence in its advertisements.5. Survey and Advertisement AnalysisFor the purpose of analysis we chose two sectors in India Telecom sector and beverage industry in India. Primary motivation behind choosing these sectors was that no major/radical change has happened in the time period considered in these sectors. Airtel and Idea were chosen in the Telecom sector and Thumps up and Pepsi was chosen in the beverages category.We listed down various celebrities who have endorsed these brands in the past and asked consumers about the image perception of these celebrities and the image perception of these brands. Following celebrities were considered Mahendra Singh Dhoni, Abhishek Bachchan, Ranbir Kapoor, Shahrukh Khan, Deepika Padukone, Akshay Kumar and Salman Khan.Picture below presents the perception map of the various celebrities on a set of pre-defined dimensions. attend Perception Map of Celebrities show Perceptual Map of Brands6. AirtelAd CampaignsPower to keep in trouble (1995-98) This era saw the beginning of mobile communication in India. completely the elite in society that could afford to keep mobile phones. Hence, it fructify itself in the premium category aimed at high class society. posit Yourself (2003-08)This campaign was successfully launched taking the ownership of the entire space of telecom and strengthening the emotional bond that Airtel had established with its customers over the courses. It highlights the capability of Airtel in terms of perf ormance and network coverage.Dil jo chaahe paas laaye (2010-2012)With the spread of Airtel in over 19 countries, Airtel finalized to change its message decision strategy. The new brand logo was launched with the intention of bringing the brand closer to its consumers and as a image which will help oneself ensure instant recognition across respective(a) international commercialises.Jo mera hai woh tera (2012)Airtel has launched ad campaign on Friendship day targeting callowness and showcasing itself as a brand which brings friends closer.Although the craft of friendship has been deployed by all and sundry in theircommunication strategies, the difference is in the creative interpretation of the theme.Celebrity EndorsementShahrukh Khan got attached with brand in the year 2002. The reason of taking him was that Shahrukh Khans core values of being a successful actor with his success catch and therefore would pertain more to the masses.Sachin Tendulkar got associated with the brand in October 2003. His dedication, innocence and performance are today seen as a driver of self-identification amongst the masses and hence he was roped in. Also, Sachin and Airtel both are leaders having similar values and personality traits like trustworthiness, friendliness, youthfulness and trend-setters.In the years 2003-2007 chiefly three celebrities were used SachinTendular, Sharukh Khan, A.R. Rehman. All the three are the leaders in their respective fields, so is AIRTEL.VidyaBalan and Madhavan were used as celebrities in the year 2008. Spontaneity and vibrancy are key attributes of Airtel. VidyaBalan is a hugely dexterous actress who brings a lot of freshness and naturalness to any role. Madhavan is a voluminous superstar in the southern region. Hence Airtel picks him up to connate leadership. Saif and Kareena were also used as celebrities endorsing the brand for the year 2008.Source Attractiveness and crediblenessAirtel has used various celebrities at various times. All these celebrities have kaput(p) well with its brand image which it has tried to portray time to time. Shahrukh Khans one of the brand endorser has core values of being a self-made actor with his success glamour and goes well with the attributes of the brand. Perceived social value of source likability in terms of physical appearance and social status is high. Also, public has familiarity with the source and hence people are able to yoke to the brand.Image characteristics MatchFollowing Brand characteristics and celebrity characteristics were arrived at using the survey results and secondary winding data. ikon Image Match up AirtelBalance TheoryFigure Balance Theory Airtelhttp//telecomtalk.info/wp-content/uploads/2009/10/airtel-srk.jpgHence the image of Shahrukh Khan doesnt actually match with the image of Airtel. The success of Airtel and its consistent market share can be attributed to the source attractiveness and credibility principle. Airtel has been able to sustain very high market share over the year.Figure Market Share AirtelYears20072008200920102011Market Share (% terms)22.423.72421.820Source Crisil Research7. Idea CellularTill 2007, Ideas ads were highlighting its duty plans and network coverage. They were focused on its network coverage and promotional packages.A Good Idea Campaign (2006) Ideas promotions in 2006 were based on its tariffs, service quality, and network coverage. In 2007, Idea shifted its focus to using mobile phone to solve social issues. Idea also developed several websites to support its ads based on social issues. Idea chose to promote its brand where as its competitors focused on promoting their value added go and tariff plans.An Idea can change your life, A good Idea, and What an Idea (2007-11) These campaigns, based on social issues (Education for all, language barrier, Use mobile save paper) that could be solved using mobile telephony, were acclaimed for their creativity. Celebrity endorser Abhishek Bachchan was used for all these ad campaigns.Celebrity EndorsementIdea roped in Abhishek Bachchan to endorse its brand in October 2007 to lead its geographical presence to cover several telecom circles in India.In the past Idea has also tied up with Indian premier League (IPL) cricket team, Mumbai Indians, and popular players like Sachin Tendulkar and Zaheer Khan were used to promote the brand.CommentsAnalysts felt that using Bachchan, one of the leading movie actors in India who is exceedingly popular among newfangledsters, was one of the reasons for the significant improvement in Ideas brand recall. However, some experts felt that while Ideas ad campaigns were creative and improved its brand recall, there was nothing in the ads that would attract a customer of its competitors or a new subscriber. They felt that Idea should have promoted the unique selling points of its products and services in the ads rather than only projecting the uses of mobile telephony.Source Attractiveness and Credi bilityPerceived social value of source likability in terms of physical appearance and social status is high. Also, public has familiarity with the source and hence brand recall is high as people are able to relate to the brand.Image characteristics MatchFollowing Brand characteristics and celebrity characteristics were arrived at using the survey results and secondary data.Figure Image Match up IdeaFigure Market Share IdeaYears20072008200920102011Market Share (% terms)8.49.29.910.011.0If we look at the market share of Idea is has not additiond significantly over the years. Though the celebrity status of Abhishek Bhachchan has been able to generate a good recall (also supported by our survey results), it has not been able to convert to the brand purchase, due to the image twin with the brand.Balance TheoryFigure Balance Theory Ideahttps//encrypted-tbn3.google.com/images?q=tbnANd9GcQedzqyWQGKf4QQ-BIgLfhU9rxl9HB5o6bSN3iLxL3ouvDpkhLW8. Thumps UpThumps Up has always been about a highly glorified, desirable cosmea of masculinity that every recentster seeks. This comes from the characteristics of the product itself which is a harder, less sweetened, more raw cola, as compared to the almost toned-down nature of its competitors.Campaigns through the years quick days are here again (1977 1980) Positioned as a reinvigorated drink, emphasized on happiness.Taste the hollering Campaign (1988 2012) Initially positioned as an individualistic masculine brand, but over the years went on to add adventure, confidence and playfulness. It was used to connect with the young Indian male. This campaign have Salman Khan, Sunil Shetty and Akshay Kumar over the years.Khatron Ke Khiladi (KKK) show on Colors Channel (2011)Thums Up was the title of respect sponsor for the show. The show was completely integrated with brand Thums Up from the concept to approach as it had adventure and daring stunts. Also, Akshay Kumar, who is Thums Ups brand ambassador, hosted the show.Aaj Kuch Toofani karte hain (2012)In this campaign, the brand challenges its loyalists to push the envelope and do something daring or toofani. It urges its consumers to Live the Thunder and unlock the new code of masculinity. The television commercial features South Indian actor Mahesh Babu, Dhaval Thakur (winner of Khatron ke Khiladi 2011), Sahil Shroff (actor) and Angela Jonsson (model who appeared on Kingfisher Calendar).Celebrity EndorsementsThums Up has been using celebrities to endorse its brand through the years. It picked up action heroes like Salman Khan, Sunil Shetty and Akshay Kumar. For the Andhra Pradesh region which is the biggest market for the brand they roped in their most revered star Chiranjeevi. Recently they got the latest mavin in Andhra Pradesh, Mahesh Babu to endorse the brand.1999 2000 Salman Khan1999 2000 Sunil Shetty2002 2012 Akshay Kumar2012 Mahesh BabuImage characteristics MatchFollowing Brand characteristics and celebrity characteristics were arrived a t using the survey results and secondary data.Figure Image Match Up Thumps UpIn 2002, Akshay Kumar was roped in as the brand ambassador and the brand continued to strengthen its position as a Male Iconic Brand through consistent positioning. His training in martial arts and his raw, rugged looks have raise the coolness and macho quotient of the brand.According to the survey results, Thums Up Ad featuring Akshay Kumar had better recall than the ad featuring Salman Khan. This can probably be explained by the image characteristics associated with the brand. They are more in sync with the image characteristics of Akshay Kumar.Figure Balance Theory Thums UpThe market share of Thums Up increased in 2009. It was when they launched a new campaign that took the whole idea of I leave alone Do Anything for My Thunder attitude of the Indian male to the next level with Akshay Kumar in the commercials.Figure Market Share Thums UpBrand2008200920102011Thumps Up14.916.316.716.5Source Euromon itor9. PepsiPepsi is a brand that stands for its youthfulness, irreverence, and dare for more spirit. Pepsi has always introduced new youth expressions as part of its campaign launches. Popular Pepsi lines have reflected the young generations attitude and values besides standing for an irreverent point of view.Campaigns through the years and Celebrity EndorsementsYehiHai Right Choice Baby Aha (1991) This campaign with stars and glamour was an adaptation of an international Pepsi campaign. It featured Aamir Khan, MahimaChaudhary and AishwaryaRai.Yeh Dil Maange More (1999 2006) This campaign sought to establish Pepsi as a strong brand with Indian youth and the word became a runaway success. The ads featured prominent sports personalities and film stars, such asSachin Tendulkar,Shahrukh Khan,AmitabhBachchan.Yeh Pyaas Hai Badi (2005) With a peppy jingle Oye Bubbly to spearhead the campaign, Pepsi latched on to the tagline, YehPyaasHaiBadi. It was mainly promoted through Shah Rukh Khan , PreityZintaandSaif Ali Khan. The campaign was all about a bigger zest to get more out of life. It was about the assertive spirit and confidence of the youth to make things happen.Yeh Hai Youngistan Meri Jaan (2008) This campaign attempted to capture not only the youth attitude but also the great sense of optimism, success and buzz about India and the Indian youth. With the Youngistaan campaign Pepsi branded the new generation. As the name suggests, it represented a world of the youth, where the young generation likes to be in control. It brought forward their never failing attitude, their desire to take on challenges and the power to turn things around. The Youngistaan idea captured the energy, excitement and irreverence of the young positive(p) India. For this campaign Pepsi signed on fresh faces like RanbirKapoor and DeepikaPadukone.My Pepsi My Way (2009) Reiterating its connect with cricket and the youth, PepsiCo rolled out a this campaign featuring five cricketers MS Dhoni, VirenderSehwag, Ishant Sharma, Robin Uthappa and Praveen Kumar, playing cricket on boats. Through this campaign brand Pepsi provoked the youth to take on any situation and use their mental smarts to effortlessly find their way through any given situation.Youngistan ka Wow (2010) While keeping the brand identity of youthfulness intact, this campaign of Pepsi took forward the concept of Youngistaan. The campaign featured RanbirKapoor.Recently, Pepsi has dropped Sachin Tendulkar and Shah Rukh Khan as its brand endorsers because now they have grown old and do not go well with the Youngistan concept. The new Indian youth and the brand image of Pepsi now relates more with the next generation of young stars and cricketers.The brand has been endorsed by the celebrities (like RanbirKapoor, DeepikaPadukone and young cricket stars) that match up with its image since 2008. The highly relevant characteristics of these endorsers are consistent with the highly relevant attributes of the brand.Ima ge characteristics MatchBrand attributes of Pepsi go well with the image of Ranbir Kapoor more than the image of Shahrukh Khan and it is evident from the increase in market share at the time when Ranbir Kapoor was roped in as the celebrity endorser for Pepsi. Following Brand characteristics and celebrity characteristics were arrived at using the survey results and secondary data.Figure Image Match up PepsiFigure Market Share PepsiBrand2008200920102011Pepsi14.514.914.915.0Source EuromonitorThere was an increase in the market share from 2008 to 2009. This was the period when the Youngistan campaign was launched with Ranbir Kapoor as the new generation brand ambassador whose image of youthfulness, self-belief and smartness is consistent with the brand image.Balance TheoryFigure Balance Theory Pepsihttps//encrypted-tbn2.google.com/images?q=tbnANd9GcTCAtyimm0Mgl7jziXUgpURskhEH8XElW3zuM2_PjXcyPFFMrYcTw10. Implications for MarketersCelebrities endorsements have not always been succes sful and even the biggest of the celebrities have failed to bring the desired revenues to the companies. It is essential for an advertiser to be aware of the complex processes associated with the celebrity endorsement.Our report provides insights into the various models in the celebrity endorsements and assesses them in Indian context. Insights from the report can help marketers decide when to use a celebrity and when celebrity endorsements pay off. This will help in optimizing the spending on the advertisements.

Internal Analysis Strong And Weak Points Marketing Essay

Internal Analysis Strong And Weak Points Marketing Essay try basically the chosen merchandising alloy. (normally you apply the actual grocery storeing-mix, save since that does non automatically exist straight off in the Netherlands, you contend to assess the ( slamn and/or expected) strengths and fadednesses. Elements to read actual dodging of the family (abroad) and hearty /weak layers influencing you mkt-mix (e.g. coronation budget scum bag be to a fault low)Use your own glance results concerning the fruit or substitute convergences where pertinent, in order to know if this influences (strong point/weak point) your actualperformance.Elements you must include be therefore* growth (benefits, attributes, core, actual, increase - mark offing dodge)* terms (pricing strategy -price background knowledge), including be you get surface contrive, break-even, etc* statistical dissemination (chosen partners, online, direct ) strategy and speak tos* converse st rategy and embodys, hind end be home(a) and external, is promotional material wise related to distribution and product/brandingAlso, but slight extensive, since this goes beyond IP-1* personel/employees HRM -strategy and be* purchase function / supply chain be for managing the foster chain, etc* finance (investment =? Do you hold back the money ? Do non ignore, you posit it for your budgetting, so at least name it and explain how real much is involved, bear on the costs as low as workable )(finance=communicating costs, personnel costs, starting up costs,The total must be coherent, hard-nosed and financially feasibleRelevant conclusionsCHAPTER 2 INTERNAL ANALYSIS -STONG AND feeble POINTSIntroductionThe internal abbreviation of the company chiffonier be akinwise associated with SWOT analysis. This is an analysis of the strenghts, weaknesses, opportunities and aff right hands of the company. Internal analysis is essential for the company because it poop measu re the companys electric current situation and it can help to further the maturation of the company. By analysing these four sides of the company we can better understand what is essential to further the growth of the company. It is necessary to try out our situation in its current position in order to pass on better planning for the future. Since our design is to introduce the product and the company to the Dutch market success richly we fate to internally analyse our strenghts, weakneses, opportunuties and possible threats in the rude(a) market. By the internal analysis we can in addition select improvements in our overall selling strategy. By internal analysis of the company we can easily list marketing opportunities, problems and evaluate performence. The main purpose of the internal analysis is to cod a better picture of the companys overall performance and to help us with making better marketing decisions for the future growth.Structure of the internal analysisThi s analysis is going to show the strenghts and weaknesses of our marketing strategy. We ordain analyse all(prenominal) part of the marketing mix in order to estimate its efficiency. Elements to analyseExtensive analysisActual strategy of the company and strong/weak points influencing our marketing mix yield analysisPricing analysis distribution analysisCommunication analysisLess extensive analysis force-out/Employees HRM strategy and costsPurchase function/Supply chain payAt the end of the analysis we allowing provide a relevant conclusion.Actual strategy of the company and strong/weak points influencing its marketing mixProduct analysisOur market offering is a soft, multivimatin throw. What is special close to our product is the concept of the product. It stands out from early(a) multivitamin drinks in the alike product group. In this part of the analysis we are going to analyse the benefits, attributes, the core of the product, the actual product, the augmented product. T he analysis go forth include the strong and weak points of the product which give affect our actual performance.Product benefitsAs a main benefit of our product can be considered the incident that it is healthy and it includes a plenty of vitamins.Another benefit is the innovational packaging. It is get outive and offers to the customers a special way of drinking. It is also interesting and more fun than other products in the same product group. The cap consists vitamin powder which falls into the irrigate in the bottleful immediately after opening the cap.Product attributesProduct Quality For the quality we dont have to interchange anything, because our product GO instanter has a very good quality, and its a very popular drink because of quality in Eastern Europe. So we hope that Dutch consumers give have the same opinion about our product.Product Features Based on our survey, we dont have to add any additional features for our product.Product Style and formulate Our pro duct has an eye-catching style, so we dont have to change it. For design, its a topographic point a problem for now. We ring that in future we will change it for the Dutch market, because design it is a deep understanding of customers deals. But for now we will leave it the same.Branding Brand is very important for the product, and our product brand is still unknown for the Dutch market. For Dutch market we have change already the name of our brand, so we made it much easier for local anesthetic consumers.Packaging We have kind of a good packaging, especially for the Dutch market, because our main product GO chromatic flavor is in chromatic color, and, base on survey, people like especially this feature of our product. The unless thing that we have to change is that we have to translate the product discipline from creation to Dutch and English languages.Labeling We will not change the label, we dont need this, because based on the survey we made, we set up out that consume rs are fully satisfied with the product we offer.Product Support Services We will acquire a survey among our customers periodically to assess the quantify of our future service, and that will also help us for obtaining new ideas.Core customer value of our productOur product offers to the customers healthy and re perting drink. It improves their lifestyle. It is also a new way of drinking which is a lot of fun.Actual productGO is a a refreshing multi-vitamin drink in innovative package, competent to everyone who lives on the go and actively enjoys their free time.The product itself is in an orange packaging. It is a new way of drinking. You open the cap. Add GO water supply to suit your taste. Then you close the cap and shake the bottle. Your GO is ready. In the end you enjoy the unforgettable taste of your favorite multivitamin drink. The slogan of this product is Open and GOAugmented productThe service the company provides is that if you are not satisfied with the product they will do everything they can to help you with your problem.They have also a give upy service, you order it on the internet and deliver the next day. Delivery takes too long so this is a weakness but if there is salient interesnt in tainting the product online we can make changes and fasten the delivery of the product.Branding strategyEven though the brand is very popular in more or less East European countries it is still unknown in the Netherlands. We will make some changes in the brand name because it is too difficult to bring forward and it doesnt make any sense for the Dutch consumers.Of course, it is still possible to keep the brand name of the product but it will not be the best choice because its too long and its also hard to regain and pronounce. We need something simpler in order to make our product popular. Our products original brand name was Cedevita GO and we have decided to shorten it and change it nevertheless to GO. The new name is easier to pronounce and to remember its also with big letters so it draws the customers concern. Also the word Go have a meaning in English and it manner proceed which associates with sport and physiologic activities that are important for the health.Pricing analysisWe suggest for the client to identify the price at 2,00The price Atlantic Grupa puts is 1,40, the retailer price is 1,70, so the best price for our client would be 2,00 since the customers in Holland have a little bit more money to spend. And since the nature of the product is to be on the go, it would be a normal price since the other products are quite expensive as well(tank stations, AH to go etc.). And with 2,00 you would have a straitlaced price. And combined with a psychological setting it would result in the last-place of 1,99Another part of our pricing analysis is that the price of our product is quite high to reflect a authentic amount of exclusiveness. So in that sense, we would like to pick premium pricing from the options Kotl ers diagnoses to us.Abroad the BEA is 15,849 since this amount of euro is the ceaseless costs. That centre Atlantic Grupa has to sell exactly 11.321 bottles of cedevita GO. With a cut-rate sale of 1.684.295 and a net income of 99.292 in 2010 it is fairly easy to get out of the BEA in Holland. In Holland however, we have to include promotion costs in our constant costs and that will result in slightly high BEA. We still believe that this BEA can be seen as a threat if our promotion program fails, normally companies ever so expect losses in the first few years. The promotion costs will be near 20700 and this will increase the BEA to 11.321+8280=19.621Distribution analysisDistribution phone lines for our productIt is an indirect marketing parentage, because we will sell our product in supermarkets. That means that we have to use one or more levels of intermediaries to help us to bring the product to final buyers.It is crucial to use this marketing channel for our product, becau se intermediaries could create great efficiency in making goods available to take aim markets. Through their contacts, experience, specialization, and scale of operation, intermediaries usually offer the firm more that it can achieve on its own.Our distribution channel will look like thisProducerWholesalerRetailerConsumerDistribution functionsInformation with information we could know more about actors and forces in the in the marketing environment, that affect our product. progression with promotion we could tell more about our product to our target consumer market. twin(a) this will help us to bring the product, which is matched to Dutch consumers needs.Physical distribution the main function of physical distribution is to transport and store the goods. financial support with financing we can cover the cost for the product chain.Risk victorious we need to take risk of carrying out the channel work.Distribution accusatory and strategyMain objective is to minimize the total cha nnel cost of meeting customer-service requirements. That means that we have to focus on our target market group, to satisfy needs and wants of our customers, and minimize the channel cost.We will use intensive distribution strategy for our products, we will stock our products in as galore(postnominal) outlets as possible. Our products have to be available where and when consumers want them, to provide maximum brand exposure and consumer convenience.Use of logisticalsLogistics involves getting the right product to the right customers in the right place at the right time. So it is very important to organize in the right way.First of all we need a warehouse in the Netherlands, to store our products, while they wait to be sold. We will use the distribution centres, because they are design to move goods quite an than store them. This will help us to take orders, fill them efficiently, and deliver goods to consumers as quickly as possible.Then as the inventory focusing also affects c ustomer satisfaction, we have to decide how much inventory to order. We have to maintain balance between carrying to little inventory and carrying too much.after that we need to choose transportation for our product. The best way to transport our goods is by trucks. Mainly, because truck is highly flexible in their routing and time schedules, and they can usually offer faster service than railroads.The last step is a logistic information management. We will use the internet-based electronic data interchange (EDI). EDI will provide us with a simple, fast, and accurate process for capturing, processing, and sharing channel information.EDI costs exists ofImplementation TimeMaintenance FeesVAN ChargesMailbox costCommunication analysisCommunication target groupsOur target groups will beYoung peoplePhysically active peopleSportsmenStudentsPeople who give way very oftenCommunication objectivesOur main objective is to make the consumers buy our product. But this is not a very easy task sin ce in order to fulfill it we need to understand the consumer and his needs and wants. We also need to know on which buyer-readiness stage the target audience now stands and where should it be. The buyer-readiness stages are the stages which the consumer normally passes through on their way to purchase. It includes mindfulness, knowledge, liking, preference, conviction, and purchase. Since our product is new to the Dutch market we already know that our target group is not aware of the product. So our first task will be to make consumers old(prenominal) with the new product. After that we need to use the promotion mix tools in order to create positive feeling and conviction about .It is possible that we will offer special promotional prices in order to attract customers. Still, the most important thing is to convince the consumers that our product provides superior value for them and to get them to the purchase stage of the buyer-readiness stage.MediaWe will use non individualized c ommunication channel for our product, this means that we will use media that will carry messages without personal contact or feedback. Basically, we will use online media (e-mail, company net site, and online kind and sharing networks), print media (newspapers, magazines), display media (flyers, posters).Promotion toolsFor our product Go we will use advertising and sales promotion.For advertising we will primarily use online advertising, which includesContextual ads that appear on a search engine results pagesCompanys web siteBanner adsSocial network advertisingAdvertising networkse-mail marketing.We will also use In-store advertising, which includesPlacement of product in apparent location in store publicizings on shopping cartsAdvertisements on in-store telecasting displaysFor sales promotion we will use special cents-of deals to attract consumers attention by offering strong incentives to purchase our product GoPromotionsWe will advice our client to use sales promotions. Th e best is to use consumer sales promotion. That means that we will target our promotion on a consumers. Good examples of the consumer sales promotion areCents-off deal Offers a brand at a lower price. Price reduction may be a voice marked on the package.Price-pack deal The packaging offers a consumer a certain portionage more of the product for the same price (for example, 25 percent extra).The non-stop retailing can be used to promote the clients product to the customer. severally of our competitors has a web-site and the products can be purchased online. The sites also include a lot of promotions. Non-stop retailing allows customers to research the product online first and then decide preferably to buy it or not. The web-sites do more than selling products to the customers they also make them go to the supermarket and shop there.Promotion budgetWe will use objective-and-task method, because we think that it is the best method for our promotion campaign. With this method we wil lDefine particularised objectivesDetermine the task that must be performed to achieve these objectivesEstimate the cost to of performing these tasks (the sum of these cost is the proposed promotion budget)We surf the Internet and found out that our communication budget will vary from 18100 to 20700 euros for a month, number on quantity and quality we will need to promote our product. It consists ofMagazines advertisement-from 13000 to 15000 eurosAdvertisement on the most popular Dutch social web site Hyves 700 eurosAdvertisement on various Internet search engines (Yahoo, Google) from 900 to 1500 eurosTo create and maintain our Go Web site 1500 eurosFlyers and posters 300 eurosEmployee salary for posting flyers and posters two hundred0 eurosSince the product is completely unknown on the Dutch market we need to do a lot of promotions and advertisements in order to make it popular. This is of course a weak point because we need to build an image of the product from the zero. We will spend big amount of money on promotions and this can also affect the product price because it can make the product too expensive.Personnel/Employees HRM strategy and costsThe HRM-strategy is in terms of originality as innovative and interesting, as the product itself. First of all I want to mention that there is a majority of women on the work floor and based on the financial reports they are doing quite well with their current settings. in that location are 62% females and 38% in the company with 1800 employees in total. We would pep up decreasing the brand managers since there are more then 200 of them in the company. Instead of focusing on the amount of brand managers we think that their salary would be better spent on mass-marketing, of course it would be less effective but you have a much greater public you can rival. The median age is more or less 30 but we believe that this can be lowered if younger people can be hired instead of the older ones, this is a price-cut ter and also brings fresh wind/talent to the company.financeIf we estimate the total calculation of our financial analysis we have to take account with the following factorsPersonnel costs/research costsPromotion/media costsDistribution costs( EDI system)Transportation costsWe believe that there is no personnel extensive use in our project( or at least in the early steps of it), with a research department of nigh 50 people divided into finance, marketing and laws should be sufficient enough for a non-superficial answer to the obstacles Atlantic Grupa will face. So if I calculate the total personnel costs with an number salary of 1800 euro(the centre is located in Eastern-Europe, lower salaries) it should be 180050= 90.000 utter(a) salary costs every month for the personnel/research ( I believe these 2 factors can be merged into 1since research is always done by the personnel.) Furthermore, promotion costs will be around 20.000 euros a month.The distribution costs is very tricky s ince setting up a logistic information system(EDI) is quite expensive which is mainly used by the bigger companies. The costs start from 40.000 euros and can reach 900.000 euros depending on mapping size, it is also important to note that maintaining an EDI costs around 18% of the price you paid for the system every year. A price of 200.000 for the system is enough to guarantee a high quality distribution system.Transportation costs are around 7 cents for every bottle sent, so 70.000x 0.07= 4900 eurosSo if i calculate everything together it would result in200.000+90.000+20.000+4900=314.900 euros starting up costs with 36.000+90.000+20.000 extra every month and 0.07cents x every bottle sold (variable cost)=146.000 extra per month314.900 Euros+ 146.000 every month(and peradventure some credits -)), we believe that this fits in the SMART approach-