Akshey wants to start a new business venture in Edtech space in India. He has also got some of his friends as Co-founders in the startup. The main target customer segment was K-12. They did all the primary and secondary market research in form of surveys, interviews, data mining, etc. By understanding the needs, they finally developed a product in such a way that attracts the targeted customers. To make it easier for the students to use the product, they included services such as after sales services, maintenance services, and technical services in their product. The company decided to follow freemium model to charge for the product. Some elements were available for free while a certain amount was charged to avail the services of other elements. The company launched multiple programs to inform school students about all this.
Which function of marketing is highlighted in the line, “The company decided to follow the freemium model to charge for the product. Some elements were available for free while a certain amount was charged to avail the services of other elements.”?
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Pricing of the product
Option (1) Customer support services — Incorrect. These help customers use the product after buying it. The line is about what customers pay.
Option (2) Pricing of the product — Correct. Pricing means deciding the money customers pay for the product. Under the freemium model, some features are free and a charge is made for the others. Choosing this model is a pricing decision, made to attract students first and then earn from those who want more.
Option (3) Promotion — Incorrect. Promotion informs and persuades customers. A free part may attract users, but deciding what is free and what is charged is pricing.
Option (4) Physical distribution — Incorrect. Physical distribution is about moving the product to customers, not about what they pay.
NCERT (2026-27 Edition): “Functions Of Marketing … 8. Pricing of Product: Price of product refers to the amount of money customers have to pay to obtain a product. Price is an important factor affecting the success or failure of a product in the market. The demand for a product or service is related to its price. Generally lower the price, higher would be the demand for the product and vice-versa. …” |