Given below are two statements:
Statement I: In a situation of overfull demand, the marketing manager may reduce the demand temporarily by increasing the prices.
Statement II: In a situation of irregular demand, the marketing manager may change the time pattern of demand by reducing the expenditure on promotion.
In the light of the above statements, choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Statement I is correct but Statement II is incorrect.
Statement I: In a situation of overfull demand, the marketing manager may reduce the demand temporarily by increasing the prices. — Correct. Overfull demand means the demand is more than the company can or wants to handle. The manager then tries to reduce the demand for a time. Increasing the prices, or spending less on promotion, does this.
Statement II: In a situation of irregular demand, the marketing manager may change the time pattern of demand by reducing the expenditure on promotion. — Incorrect. Irregular demand rises and falls with the season, as for fans or woollen clothes. Here the marketer changes the time pattern of demand by giving short-term incentives to buyers. Spending less on promotion is a way to cut overfull demand.
NCERT (2026-27 Edition): “Marketing Management … Marketing management generally is related to creation of demand. However, in certain situations, the manager has to restrict the demand. For example, if there is a situation of ‘overfull demand’, i.e., the demand being more than what the company can or want to handle, (like what the situation in our country was before the adoption of policies of liberalisation and globalisation, in early 90’s, in most consumer products be it automobiles or electronics goods or other durable products. The job of marketing mangers, in these situations would be to find ways to reduce the demand temporarily by say reducing the expenditure on promotion or increasing the prices. Similarly, if the demand is ‘irregular’, such as in case of seasonal products, (say fans, woollen clothes) the marketer’s job is to change the time pattern of demand through such methods as providing short-term incentives, to the buyers. Thus, the marketing management in not only concerned with creating demand but with managing the demand effectively, as per the situation in the market.” |