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< Back The Relationship between Finance and Economies by Veer Sharma Studying the system interactions and linkages between banking, finance and governance. Macroeconomics Macroeconomics is a branch of economics that focuses on the study of the economy as a whole, rather than on individual markets or specific economic agents. It deals with the behavior, performance, structure, and decision-making of an entire economy, encompassing factors such as aggregate output, employment, inflation, economic growth, and the interactions between different sectors. Key areas of focus in macroeconomics include: A) Gross Domestic Product (GDP): Macroeconomists analyze the total value of goods and services produced within a country over a specific period. GDP is a fundamental measure of economic activity and is used to gauge the overall health and size of an economy. B) Unemployment: Macroeconomics examines the level of unemployment in an economy and seeks to understand its causes and consequences. It addresses questions about how changes in economic conditions impact the job market and labor force participation. C) Inflation: Macroeconomists study changes in the general price level of goods and services, known as inflation. They explore its causes, effects, and potential policy measures to control inflation and ensure price stability. D) Economic Growth: Understanding the factors that contribute to sustained economic growth is a central concern in macroeconomics. This involves analyzing productivity, technological advancements, investment, and other factors that influence an economy's capacity to expand over time. E) Fiscal and Monetary Policy: Macroeconomists assess the impact of government policies on the economy, such as fiscal policies (government spending and taxation) and monetary policies (central bank actions like interest rate adjustments and money supply management). They study how these policies can be used to influence economic performance and stability. F) International Trade and Finance: Macroeconomics also explores the interactions between economies on a global scale. It delves into topics like exchange rates, trade imbalances, and the impact of international economic events on a country's domestic economy. G) Business Cycles: Macroeconomists analyze the cyclical fluctuations in economic activity known as business cycles. These cycles consist of periods of economic expansion (boom) and contraction (recession), and understanding their causes and dynamics is a key focus of macroeconomic research. In essence, macroeconomics provides insights into how economic systems function as a whole, how they respond to external shocks and policy changes, and how government actions can impact overall economic well-being. It helps policymakers, economists, and businesses make informed decisions to manage and improve economic conditions at the national and international levels. Microeconomics Microeconomics is a branch of economics that focuses on the study of individual economic units and their behavior within markets. It examines the interactions between households, firms, consumers, and producers at a smaller, more localized level, as opposed to the broader perspective of macroeconomics, which looks at the economy as a whole. Key areas of focus in microeconomics include: A) Supply and Demand: Microeconomics analyzes how individual buyers and sellers interact in various markets. The concept of supply and demand is central to this analysis, as it explains how prices are determined based on the interaction between consumer demand and producer supply. B) Consumer Behavior: Microeconomists study how consumers make choices about purchasing goods and services. They examine factors such as individual preferences, utility, and budget constraints to understand how consumers maximize their satisfaction (utility) given their limited resources. C) Producer Behavior: Microeconomics also looks at how firms make decisions about production and pricing. It explores concepts like production costs, profit maximization, and market structure (e.g., perfect competition, monopoly, oligopoly) to understand how firms operate in different competitive environments. D) Market Structures: Microeconomics categorizes markets based on the number of sellers and buyers, their influence over price, and the nature of the goods being traded. Different market structures have distinct implications for pricing, competition, and efficiency. E) Resource Allocation: Microeconomics examines how scarce resources are allocated among competing uses. It delves into topics like opportunity cost, production efficiency, and factors of production (land, labor, capital, entrepreneurship) to understand how resources are utilized to produce goods and services. F) Welfare Economics: Microeconomists assess the overall welfare or well-being of society by analyzing the efficiency and equity implications of market outcomes. Concepts like consumer surplus, producer surplus, and market equilibrium are used to evaluate the desirability of various economic situations. G) Externalities and Market Failures: Microeconomics addresses situations where markets do not achieve efficient outcomes due to factors like external costs or benefits (externalities), public goods, and imperfect information. It explores how government intervention or policy measures might be necessary to address these market failures. In summary, microeconomics provides insights into the behavior of individual economic agents and their interactions within markets. It helps to understand how prices are determined, how consumers and producers make choices, and how resources are allocated in various economic settings. Microeconomic analysis is essential for making informed decisions about resource allocation, market regulation, and understanding the intricacies of specific economic activities. Financial Systems A financial system is a set of institutions, such as banks, insurance companies, and stock exchanges, that permit the exchange of funds. Financial systems exist on firm, regional, and global levels. Borrowers, lenders, and investors exchange current funds to finance projects, either for consumption or productive investments, and to pursue a return on their financial assets. The financial system also includes sets of rules and practices that borrowers and lenders use to decide which projects get financed, who finances projects, and terms of financial deals. There are four components of Financial Systems – A) Financial institutions - Financial institutions play a significant role in bringing together lenders and borrowers. This is done by using various financial instruments and services, all of which contribute to an efficient financial system. The financial institution is one of the main components which ensure liquidity in the financial system through the development of credit and other liquid assets. B) Financial services - Financial services include credit rating agencies, mutual funds, pension funds, venture capital, and other institutions that are part of the financial system. Financial services are an important component of the financial system due to their specific tasks. C) Financial markets - A financial market is where both the creation of new financial assets and the trading of existing ones occur. Financial markets move funds from savers to borrowers much more efficiently and ensure that there is always liquidity. D) Financial instruments - Financial instruments are another main component of the financial system. Financial instruments are papers that entitle the buyer to future income from the seller. That's because there are different needs between investors and those looking for credit. Risk Management What is Risk Management? Risk management involves identifying, analyzing, and accepting or mitigating uncertainty in investment decisions. Put simply, it is the process of monitoring and dealing with the financial risks associated with investing. Risk management essentially occurs when an investor or fund manager analyzes and attempts to quantify the potential for losses in an investment, such as a moral hazard, and then takes the appropriate action (or inaction) to meet their objectives and risk tolerance. Importance of Risk Management? If an unforeseen event catches your organization unaware, the impact could be minor, such as a small impact on your overhead costs. In a worst-case scenario, though, it could be catastrophic and have serious ramifications, such as a significant financial burden or even the closure of your business. To reduce risk, an organization needs to apply resources to minimize, monitor and control the impact of negative events while maximizing positive events. A consistent, systemic and integrated approach to risk management can help determine how best to identify, manage and mitigate significant risks. Process of Risk Management: A) Identifying risks - Risk identification is the process of identifying and assessing threats to an organization, its operations and its workforce. For example, risk identification may include assessing IT security threats such as malware and ransomware, accidents, natural disasters and other potentially harmful events that could disrupt business operations. B) Risk analysis and assessment - Risk analysis involves establishing the probability that a risk event might occur and the potential outcome of each event. Risk evaluation compares the magnitude of each risk and ranks them according to prominence and consequence. C) Risk mitigation and monitoring - Risk mitigation refers to the process of planning and developing methods and options to reduce threats to project objectives. A project team might implement risk mitigation strategies to identify, monitor and evaluate risks and consequences inherent to completing a specific project, such as new product creation. Risk mitigation also includes the actions put into place to deal with issues and effects of those issues regarding a project. International Banking International banking refers to the financial services and activities that involve transactions and operations across national borders. It involves the movement of funds, assets, and capital between individuals, businesses, and institutions in different countries. International banking plays a crucial role in facilitating global trade, investment, and economic activities. Features of International Banking – A) Flexibility: This banking facility provides flexibility to multinational companies to deal in multiple currencies. The major currencies that multinational companies or individuals can deal with include the euro, dollar, pounds, sterling, and rupee. The companies with headquarters in other countries can manage their bank accounts and avail of financial services in other countries through this banking without any hassle. B) Accessibility: International banking provides accessibility and ease of doing business to companies from different countries. An individual or MNC can use their money anywhere around the world. This gives them the freedom to transact and use their money to meet any funds requirement in any part of the world. C) International Bank Transfers/Transaction: International banking allows the business to make international bill payments. The currency conversion facility allows the companies to pay and receive money easily. Also, benefits like overdraft facilities, loans, deposits, etc., are available every time for overseas transactions. Correspondent banking is very useful in such transactions. D) Accounts Maintenance: A multinational company can maintain the records of global accounts in a fair manner with the help of international banking. All the company’s transactions are recorded in the books of banks across the globe. By compiling the data and figures, the company’s accounts can be maintained. Investment Finance Investment finance refers to the allocation of funds or capital with the goal of generating returns or profits over a certain period of time. It involves the strategic deployment of financial resources into various assets, such as stocks, bonds, real estate, mutual funds, and other financial instruments, with the expectation of earning income or achieving capital appreciation. Objectives of Investment Finance – A) Wealth Accumulation: Individuals, businesses, and institutions invest their funds to grow their wealth over time. This can be achieved through capital gains (increase in the value of the invested assets) and/or income generated from dividends, interest, or rental payments. B) Capital Preservation: Some investments focus on preserving the initial capital while generating modest returns. These are often considered lower-risk investments, such as government bonds or certain types of savings accounts. C) Risk and Return Trade-Off: Investment finance involves assessing and managing the trade-off between risk and potential return. Generally, investments with higher potential returns are associated with higher levels of risk. D) Diversification: A key principle of investment finance is diversifying the investment portfolio across different asset classes and geographic regions to reduce risk. Diversification helps mitigate the impact of poor performance in any one investment. Corporate Finance Corporate finance refers to the financial activities and decisions made by corporations or businesses to manage their financial resources, optimize their capital structure, and make strategic financial decisions that maximize shareholder value. It involves a wide range of activities that revolve around obtaining and using funds effectively to achieve the company's goals and objectives. Objectives of Corporate Finance – A) Maximizing Shareholder Value: One of the primary objectives of corporate finance is to enhance the wealth of the company's shareholders. This involves making financial decisions that result in increasing the stock price, dividends, and overall returns for shareholders. B) Profitability: Corporate finance aims to generate sustainable profits by effectively managing the company's investments, operations, and expenses. Profitability ensures the company's ability to cover costs, fund growth, and provide returns to shareholders. C) Long-Term Growth: Companies strive for continuous growth and expansion to increase their market share, revenue, and profits. Corporate finance supports this objective by allocating resources to strategic investments and projects that contribute to the company's long-term success. D) Efficient Allocation of Resources: Effective corporate finance involves allocating financial resources, such as capital and investments, to projects and initiatives that offer the highest potential return. This ensures that resources are used efficiently and generate maximum value. Difference Between Investment and Corporate Finance – History of Money What is Money? Money doesn't always have value whether it's represented by a seashell, a metal coin, a piece of paper, or a string of code mined electronically by a computer. Money allows people to trade goods and services indirectly. It helps communicate the price of goods and provides individuals with a way to store their wealth. It is valuable as a unit of account—a socially accepted standard by which things are priced and with which payment is accepted. Throughout history, the concept of money has evolved from barter systems to complex financial instruments. Early societies traded goods directly, but as trade expanded, various commodities, such as shells, grain, and metals, were used as mediums of exchange. Metal objects eventually emerged as standardized forms of money, with ancient civilizations like the Greeks and Romans using coins. As economies grew, paper money emerged, initially representing promises to redeem precious metals. In the modern era, governments and central banks took control of money issuance. The gold standard linked currency values to a specific amount of gold, fostering global trade. The 20th century saw the transition to fiat money, backed by governments' legal tender and trust. The rise of electronic banking led to digital money, revolutionizing transactions. Today, cryptocurrencies, like Bitcoin, introduce decentralized and digital forms of money, challenging traditional financial systems. The history of money reflects humanity's quest for efficient and trusted mediums of exchange to facilitate trade and economic progress. Corporate Governance Corporate governance is the system of rules, practices, and processes by which a firm is directed and controlled. Corporate governance essentially involves balancing the interests of a company's many stakeholders, such as shareholders, senior management executives, customers, suppliers, financiers, the government, and the community. Since corporate governance provides the framework for attaining a company's objectives, it encompasses practically every sphere of management, from action plans and internal controls to performance measurement and corporate disclosure. Benefits of Corporate Governance – A) Good corporate governance creates transparent rules and controls, provides guidance to leadership, and aligns the interests of shareholders, directors, management, and employees. B) It helps build trust with investors, the community, and public officials. C) Corporate governance can provide investors and stakeholders with a clear idea of a company's direction and business integrity. D) It promotes long-term financial viability, opportunity, and returns. Principles of Corporate Governance – Fairness: The board of directors must treat shareholders, employees, vendors, and communities fairly and with equal consideration. Transparency: The board should provide timely, accurate, and clear information about such things as financial performance, conflicts of interest, and risks to shareholders and other stakeholders. Responsibility: The board is responsible for the oversight of corporate matters and management activities. It must be aware of and support the successful, ongoing performance of the company. Part of its responsibility is to recruit and hire a CEO. It must act in the best interests of a company and its investors. Accountability : The board must explain the purpose of a company's activities and the results of its conduct. It and company leadership are accountable for the assessment of a company's capacity, potential, and performance. It must communicate issues of importance to shareholders. Entrepreneurial Finance Entrepreneurial finance refers to the specific area of finance that deals with the financial decisions, strategies, and challenges faced by entrepreneurs, startups, and small business owners. It focuses on the unique financial needs and opportunities that arise when individuals or groups launch new ventures or seek to grow and scale their businesses. The key aspects of Entrepreneurial Finance are – A) Startup Funding: Entrepreneurs often need capital to turn their innovative ideas into viable businesses. Entrepreneurial finance involves identifying and securing funding from various sources, including personal savings, family and friends, angel investors, venture capital, and crowdfunding. B) Business Valuation: Determining the value of a startup or small business is crucial for attracting investors, negotiating equity stakes, and making informed financial decisions. Valuation methods specific to startups and early-stage companies are used. C) Capital Structure: Deciding on the mix of equity and debt financing is important for entrepreneurs. Balancing financial risk and ownership control is a key consideration in determining the optimal capital structure. D) Bootstrapping: Many startups begin with limited resources and use creative strategies to operate and grow without external funding. Entrepreneurial finance includes effective bootstrapping techniques to stretch resources and minimize cash burn. E) Risk Management: Entrepreneurs face various financial risks, including market risks, technological risks, and regulatory risks. Managing and mitigating these risks is an integral part of entrepreneurial finance. F) Financial Planning: Developing a comprehensive financial plan that outlines revenue projections, expenses, and growth strategies is essential for startup success. Entrepreneurs use financial planning to guide their operations and secure funding. BIBLIOGRAPHY 1. Investopedia.com 2. Ibm.com 3. Studysmarter.co.uk 4. Efinancemanagement.com 5. Wikipedia.org 6. Frank ISC Economics standard 12 Previous Next

< Back Historical Importance of Jewellery by Manasa Kalyan Jewelry symbolizes currency, fashion, wealth, social status, and additionally can also be treated as an investment. It is either purchased by one or passed down as an heirloom, provided as a protection, or to symbolize a relationship. It is more than just an accessory. It has something to offer everyone. Introduction: Jewelry symbolizes currency, fashion, wealth, social status, and additionally can also be treated as an investment. It is either purchased by one or passed down as an heirloom, provided as a protection, or to symbolize a relationship. It is more than just an accessory. It has something to offer everyone. The jewelry industry is a multidimensional field that comprises the making, manufacture, distribution, and vending of ornamental articles like finger rings, necklaces, wristbands, earrings, and brooches. This sector goes through different sub-sectors, such as mining and refining of precious metals and gemstones to designing and making complex pieces. Skilled craftsmen and artists are very important in changing raw materials into art pieces that can be worn using methods like casting, forging, soldering, and wire wrapping. The business further entails the marketing and sale of jewelry across several avenues, including the usual physical stores, online platforms, and high-end stores. It reaches out to different market segments, ranging from high-value pieces to low-priced trendy items. Jewelry is designed for personal adornment in addition to serving as an investment symbol of status and identity and a medium of cultural expression. The industry is primarily influenced by seasonal trends, significant life events, consumer demand, for instance, wedding anniversary parties, etcetera. This industry performs a combination of art and craft businesses worldwide due to its dynamism. The Indian jewelry market is a key industry in the nation’s economy. The gems and jewelry industry in India contributes to up to 7% of the nation’s GDP. For Indian culture, jewelry plays a symbolic role. They carry ethnic and spiritual meanings, especially during weddings, any function, or festivals. For instance, when a bride wears jewelry during the marriage ritual, it shows the significance of her part as the lady of her husband’s extended family. The jewelry market in India mainly consists of ‘Traditional Indian Jewellery’, which differs from style and region. India has one of the largest and liveliest jewelry markets worldwide that is entrenched deeply in the cultural and economic landscape of this nation. Jewelry in this part of the world holds great cultural and religious importance that is normally connected to different festivals, marriage rites, and other ceremonies. The most preferable metal in Indian society is considered to be gold, which is why it is always associated with rites of passage as well as nuptials, among others. It is mainly made of gold, while traditional forms such as Kundan and Meenakari and traditional Indian jewelry also come in a variety of designs. Gold is still the leader of all jewelry markets, but when it comes to diamond jewelry, things are different; there seems to be a continuous upward trajectory in this segment due to a number of factors, such as varying tastes among buyers or increased marketing efforts from international companies dealing exclusively with diamonds. The retail market consists majorly of well- established chains like Tanishq and Kalyan Jewellers as well as quite so many tiny shops belonging to one family or some families; however, the increasing number of shops under the control of corporations reflects a growing tendency towards standardization and greater openness." The jewelry industry significantly contributes to India’s GDP and provides employment to millions, spanning mining, refining, designing, and retailing sectors. India is also a major exporter of gems and jewelry, serving significant markets in the USA, Europe, and the Middle East due to its skilled labor force and competitive wages, making it a global hub for the manufacturing of jewelry economically. Indian jewellery market and international market : The Indian jewelry market in general is designed mostly for elderly people who are buying jewelry, particularly for some occasions such as weddings, festivals, and other significant events. These customers usually prefer fancy diamond sets or chunky gold jewelry that is consistent with the traditional taste for luxurious and baroque designs. This demographic rarely buys light and minimalistic pieces of jewelry. Nevertheless, a noticeable trend may be observed as generations pass by, which shows a move towards lighter, less heavy pieces of jewelry. The younger generations still attach cultural and sentimental value to precious stones while going for versatile and simple designs more frequently. This trend demonstrates that there is a changing marketplace where traditional preferences are increasingly mixing with modern ones. Generally, people buy jewelry across the globe for a range of reasons that include marriage engagements, tokens of love, or personal decoration. While Indians customarily offer gold coins or silver ornaments during special events, the rest of the world mostly goes for items made by famous companies such as Tiffany’s & Co. and Van Cleef & Arpels. Specifically, these make diamond, platinum, or rose gold jewels, which are best known for their simple yet elegant looks. The focus is on sophisticated, understated pieces that serve as timeless symbols of affection and personal style, reflecting a preference for subtlety and modernity in contrast to the more opulent and traditional Indian jewelry. Cultural phenomenon of jewellery in India : Gold occupies a divine position in Indian culture, signifying more than just riches but also success, attraction, and good luck. The association of gold with religious and cultural practices is so tight it is often related to Lakshmi, the goddess of wealth in this country—a symbol of blessings for one’s home and prosperity. Notably, gold buying is highly regarded on many regional festivals such as Gudi Padwa, Akshaya Tritiya, Navaratri, Dussehra, Dhanteras, Pushyam, Balipratipada, Vishu, and Pongal, among others. As an example during Akshaya Tritiya (also referred to as Akti or Akha Teej), when people buy gold, they believe that it will bring them unending wealth since “Akshaya” means “never diminishing." This custom underlines the continued influence of gold in Indian society, where the possession of gold is a material item and a spiritually significant act believed to usher in prosperity and success for future years. Buying gold during festive occasions like festivals has its roots in the conviction that having some amount of gold brings stability to families, thus ensuring economic security against any forms of uncertainty. Apart from being valuable assets that are handed over from one generation to another as heirlooms showing family lineage and customs, this is passed down to the next heirs as tradition. Gold jewelry making process and purity are also profoundly esteemed by individuals. Beyond its tangible worth, gold holds symbolic importance, representing purity, fertility, and divine blessings in Hindu mythology. This cultural reverence for gold transcends economic considerations, making it an integral part of Indian identity and tradition. Historical Importance of Jewellery : Jewelry has always been an important cultural artifact type that was studied by people across the world. It is a kind of representation of complex and rich traditions connecting various customs with each other. Let’s start with Hinduism. Indeed, in Hinduism, jewelry is a matter for the deepest religious symbolism during the rituals and functions. Such as bridal with heavy jewelry represents good luck in terms of wealth and marriage life, while other customs associated it with divine spirit. Monks and devotees often use jewelry as an adornment during religious ceremonies and rituals in the context of Buddhism. It’s a representation of how we should let go of material things as well as the importance of finding enlightenment. Buddhist jewelry themes typically incorporate symbols such as lotus flowers, Dharma wheels (one of them), and teachings of Buddha, among others, thus expressing spiritual ideas and values. In Sikhism, jewelry that is worn is regarded as a sign of faith and identity, especially among the Khalsa. The five Ks, which consist of kirpan, kara, kachera, kangha, and kesh, are the most commonly used symbols by Sikhs, and they bear religious connotation. Sikhs use these objects of faith because they remind them of just how much they should value such things as bravery and self-control while remaining focused on the teachings given to us by Guru Nanak. Jewelry is central to traditional dress and practices in India across regions and cultures. Every region has its own unique styles as well as techniques that mirror its cultural heritage, be it the detailed temple jewelry from Southern India, the colorful beaded ornaments from Rajasthan, or the tribal decorations typical of the northeast. Birth ceremonies, marriages, harvest festivals, or religious processions are all never held without jewelry in Indian cultural tapestries. Focus in on a cultural or religious phenomenon: form example Hindu cultural significance of jewellery at each stage of a woman’s life etc: As mentioned earlier, jewelry is more than an accessory; it identifies one, is an auspicious symbol, traditions, etc. Each region has its own distinct jewelry style, crafted with intricate designs. From toe rings to tikkas, all have a significance and story to tell. Jewelry is not just an embellishment; it is a manner to showcase one’s roots and social status. It enhances one’s beauty. Let’s discuss how jewelry plays an important role in a female’s life. At Birth:Life begins with jewelry for girls in India. The bangles given to infant girls are believed to have good luck and protection. Most probably, girls usually receive earrings or necklaces as she progresses through important rites of passage and special events to mark her growth and identify herself with her family. Teenage: The teenage years are characterized by increased jewelry use, particularly in the rite of passage into adulthood. For example, a teenage girl can wear other jewelry items during her coming-of-age occasion, which is known by various names in different parts of South India like ‘Ritu Kala Samskara,’ that signals her transition into a woman. Marriage: Marriage is perhaps the most significant period where jewelry plays a crucial role in storytelling. Mostly brides wear fancy jewelry sets that contain necklaces, earrings, bangles, anklets, nose rings, and headpieces, among many others that they have at their disposal. But not only do they represent beauty and gracefulness but also have other roots in our culture, which affected the spiritual impact they made their wearers. Among these valuables is the mangalsutra, which is believed to be sacred, symbolizing the marital status, hence protection for the husband to ensure they have a happy life together forevermore. A bride often receives family heirlooms, symbolizing continuity and a welcoming gesture. Motherhood: During pregnancy and after childbirth, women may receive jewelry as a token to celebrate their new phase of life. These tokens refer to the blessings and joy of welcoming a new life. Festivals and celebrations: The jewelry received by her during these phases in her life is adorned by her during festivals and special occasions. Festivals like Diwali, Karva Chauth, etc. are such occasions where women are adorned with their finest jewelry, symbolizing prosperity, devotion, and joy. Social and Economic Significance: Apart from personal milestones, jewelry acts as a social and economic item; it is often seen as a woman’s financial safety net and status symbol among people she knows, thus making it an asset during emergencies. Jewelry in India, on the other hand, is much more than an ornament; rather, it signifies an entire plane of cosmic ruler—an autobiography that highlights important occasions in its wearer’s life as well as captures all cultural sensibilities present therein. Modern adaptation of tradition through Jewellery: the enduring ideas of tradition: As years go by with new generations taking charge, an economy’s tastes and preferences undergo evolution through the pull of new cultures, rendering some obsolete while others get adopted into them as well as trends. In contemporary India, for example, young people have redefined traditional ways of accessorizing themselves, opting for simpler styles that are consistent with today’s design principles. This change can be seen in how simpler, less heavy jewels are becoming increasingly popular among the young people, even though these used to form part of India’s diverse history but are currently” In contemporary India, for instance, young people are defining their fashion sense by adopting simplistic designs that are compatible with modern art. As years pass by, it's inevitable for markets to experience transformations due to new cultures’ attractions or ongoing trends; the tastes and preferences in any economy must keep evolving over time. This is evident because the youth today have begun doing away with too much accessory wear instead preferring minimalism, which is in line with present beauty standards. This development can be witnessed through light. “Instead of piling on big, heavy necklaces and bracelets all at once, young people are now opting to stack up thin, delicate, lightweight ones or wear one chunky item that is significantly different from the rest, going against the norm, which was to dress in many heavy ornaments concurrently.” The idea being that wedding articles are as well becoming modest. Currently, jewelry is made such as to allow pastel-toned gemstones as well as enamel works on them for fashionable marriage styles. Trending for simpler jewels and pale-colored marital affairs from the world over show a shift in societal beliefs and life approaches as a whole. The youth love flexibility, understatement, and uniqueness in clothes, and they are in search of clothes that are suitable for different functions and have personal design. It is a character of taste and preferences over time; it represents a combination between liability to traditional ideas and innovations whereby ancestral jewelry is adjusted for it to coincide with current fashion demands that secure the very nature of it in an Indian context. What consumers seek while purchasing a jewellery currently : The understandings which are herein shared were based on previous research where I went into consumer preferences in the minimalistic jewelry market. In this study, several notable discoveries came up, such as, for instance, customers giving priority to the design and quality of the jewelry pieces they intended to acquire. Superabundantly, celebrities no longer have much say in their choices of the shopping brands and are turning towards more established names or new ones that have very good reviews. By contrast, recommendations from family members and friends carried greater weight than ads. One noticeable finding was such an environment created by changing requirements of generations, which sharply differed. Younger consumers who are below 20 years started exhibiting strong preference towards artificial jewelry, perhaps due to its cheapness or ease of acquiring it. Conversely, older people included elements such as design, rate within the market, advertisements, and how reputable a brand is when purchasing. Additionally, occasions considered appropriate for putting on jewelry were exposed by this survey, whose participants spanned across all age groups, ranging from official functions to daily use. Furthermore, many buyers were inclined to touch and feel the products before making a final decision about them, thus suggesting a preference for tangible experiences, particularly among elderly customers. These insights provide valuable knowledge regarding consumer behavior within the jewelry market, which will help companies come up with strategies that would work for them. Hence, companies can respond better to changes in preferences by knowing them so that they can modify their products as well as meet demands of evolving tastes concerning those whom they seek to attract, hence resulting in higher competition among players in this industry. Conclusion: The investigation into consumers’ tastes and preferences towards minimalistic jewelry has brought forth a number of important insights. The product design and quality are the most influential factors for consumers. Celebrities and influencers no longer have an effect on them when it comes to buying jewelry. Instead, they would rather choose well-known brands or emerging ones with positive customer feedback instead of being influenced by famous people. They prefer personal recommendations from their friends and family to online advertisements. A significant finding is the difference in preferences between younger and older generations. Younger consumers, particularly those under 20, tend to go for imitations instead of real ones. This may be because they lack knowledge, are impulsive, or just want what is more affordable and convenient for them. Conversely, customers aged 20 years and above take into account issues such as advertisement, market rate, design, and reputation of a brand, whereas younger customers consider exclusively the design of the product. Regarding the occasions for wearing jewelry, most consumers across all age groups indicated that they wear jewelry for formal events and daily use while also preferring to physically handle it before buying it with a bias towards touching and feeling as opposed to relying only on online means. This preference is more pronounced among older generations, who generally resist buying jewelry online; however, resistance is expected to reduce as living standards improve and technology usage becomes commonplace. These insights highlight a full comprehension of consumer preferences in the jewelry market, suggesting potentials for growth in the internet jewelry industry, even though findings suggest that these cannot be easily generalized over a global population because this study focused on individuals from a specific area located in southern India since various living standards across different cultures necessitate further research to be done at wider perspectives, hence providing accurate results. Knowing these consumer concerns and preferences requires complex psychological studies involving diverse participants from different regions with varying backgrounds. This approach would enable one to come up with strategies aimed at addressing consumer worries better as well as keeping pace with changing lifestyles or tastes of consumers. Bibliography: 1. World Gold Council ( gold.org ) - Provides detailed reports and insights on gold demand and trends, particularly in major markets like India. 2. Gems and Jewellery Export Promotion Council ( gjepc.org ) - Offers comprehensive data on India's jewellery export statistics and market trends. 3. IBEF (India Brand Equity Foundation) ( ibef.org ) - Publishes reports on various sectors, including the Indian gems and jewellery market. 4. McKinsey & Company ( mckinsey.com ) - Often releases detailed industry analyses and future outlooks for global and regional markets, including India. 5. Retail Jeweller India ( retailjewellerindia.com ) - Provides news, trends, and analysis specifically for the Indian jewellery retail sector. 6. Business Standard ( business-standard.com ) - Covers financial and market news, including updates and trends in the Indian jewellery industry. 7. Statista ( statista.com ) - Offers statistical data and reports on various markets, including the Indian jewellery sector. 8. Research and Markets ( researchandmarkets.com ) - Provides market research reports on the Indian gems and jewellery market. 9. Economic Times - Akshaya Tritya details. Previous Next

< Back Technological Advancements in Solar Power Generation by Samyukhta Kannan Bell Laboratories created the first silicon solar cell in 1954. This breakthrough sparked a flurry of new discoveries in the field of solar energy. Solar energy is the radiant light and heat from the Sun that is captured and used in a variety of methods. The technological advancements since have shown the growing potential to use this as a reliable energy source. INTRODUCTION Solar energy is the radiant light and heat from the Sun that is captured and used in a variety of methods, including solar power to create electricity, solar thermal energy, including solar water heating, and solar architecture. It is an important source of renewable energy, and its methods are roughly classified as either passive solar or active solar, depending on how they capture, distribute, or convert solar radiation into solar power. The meaning of active and passive solar power generation becomes very important. To harness the energy, active solar techniques such as photovoltaic systems, concentrated solar power, and solar water heating are used. Orienting a structure to the Sun, selecting materials with favourable thermal mass or light-dispersing qualities, and designing rooms that naturally circulate air are all examples of passive solar techniques. Bell Laboratories created the first silicon solar cell in 1954. This breakthrough sparked a flurry of new discoveries in the field of solar energy. In the 1960s, the space industry was the first to use solar technology to create electricity for spacecraft. The first artificial earth satellite, Vanguard 1, was powered by solar cells. It was the oldest instance of a man-made satellite in orbit, clocking in at a massive 6 billion miles. TECHNOLOGIES Photovoltaic The photovoltaic effect is depicted on a band diagram. In the depletion or quasi-neutral areas, photons transfer their energy to electrons. These transition from the valence to the conduction bands. Electrons and holes are propelled by a drift electric field Edrift, which produces generation photocurrent, or by a scattering electric field Escatt, which produces scattering photocurrent, depending on their location. Alexandre deciphered the photovoltaic effect, or how to generate an electric current in a conductor exposed to direct sunshine. Later, scientists conducted more advanced research in order to use PV technology, which can directly produce power. Electricity can now be used, stored, or converted for long-distance transmission. PV devices are capable of converting sunlight into electrical energy. A "cell" is a single PV device. PV cells are often constructed from various types of silicon. A single PV cell is typically tiny and can provide roughly 1 or 2 watts of power. To boost the output of PV cells, they are linked together in chains to form bigger units known as "modules" or "panels." Modules and panels can be used separately or in groups to construct arrays. To complete a PV system, one or more arrays are connected to the electricity grid. Solar PV is primarily installed on rooftops of homes and businesses nowadays, and it directly creates electricity from solar energy. Solar thermal technologies turn the sun's energy into heat, which is then converted into electricity. Floatovoltaics Floating solar or floating photovoltaics (FPV), also known as floatovoltaics, is the installation of solar panels atop a structure that floats on a body of water, generally a reservoir or a lake. Silicon panels are becoming less expensive and more efficient by the day. Photovoltaic panels put on reservoirs and other bodies of water, according to experts, provide even more efficiency as well as a slew of other advantages. The fundamental advantage of floating PV plants is that they do not require any land, except for the little areas required for the electric cabinet and grid connections. Their cost is equivalent to that of land-based plants, yet they give an excellent option to prevent land consumption. Floating PV plants are more compact than land-based plants, have simpler administration, and are easier to build and decommission. The major aspect is that there are no fixed structures, such as the foundations needed for a land-based plant, therefore their installation is completely reversible. Another advantage is that the partial covering of basins can minimise water evaporation. This outcome is determined by the climate and the fraction of the covered surface. This is a significant advantage in dry climates such as portions of India since it saves around 30% of the evaporation of the covered surface. This may be bigger in Australia, and it is a highly desirable quality if the basin is utilised for irrigation. There are several other advantages to the new floatovoltaic technology. A big floating platform may be readily manoeuvred and can also do vertical tracking. This can be done without wasting energy or without a sophisticated mechanical equipment as in land-based PV plants. The cost of outfitting a floating PV plant with a monitoring system is minimal, and the energy increase can vary from 15 to 25 percent. Installed capacity worldwide in MV.: Floating solar farms can help with water management in addition to providing clean solar energy. They prevent water loss due to evaporation by restricting air movement and blocking sunlight from the water's surface. Furthermore, floating solar farms reduce the generation of harmful algae, cutting water treatment expenses. Furthermore, the water beneath the solar panels keeps them clean and reduces energy waste. The presence of water naturally indicates the use of gravity energy storage, particularly in conjunction with hydroelectric basins. Other methods, however, have been investigated, with compressed-air energy storage devices being proposed in particular. However, there are certain challenges that are associated with this technology. Electrical safety and the long-term dependability of system components is in question. Operating on water for its full-service life, the system must have greatly higher corrosion resistance, especially when built over salt water. The floating PV system must be able to endure wind and high waves, particularly in off-shore or near-shore deployments. Maintenance complexity is also to be considered. In general, operations and maintenance tasks on water are more difficult to conduct than on land. Photovoltaic noise barrier In 1989, Switzerland showed an effective method of noise reduction using solar modules. Later, the solution was implemented in a number of additional European nations. Different solar noise barriers may be developed based on highway characteristics, barrier structure, barrier height, and other factors (environment etc.). Modules are attached to the main barrier (wood or solid barrier) in a variety of methods, including vertical, inclined fixed as a zigzag construction, and so on. Perovskite solar cell The mineral calcium titanium oxide, which was the first perovskite crystal found, has the same structural structure as perovskite. A perovskite solar cell (PSC) is a form of solar cell in which the active layer is a perovskite-structured substance, often a hybrid organic-inorganic lead or tin halide-based material. Perovskite materials like methylammonium lead halides and all-inorganic cesium lead halides are cheap and simple to make. Perovskites are a type of material with a similar structure that exhibits a number of intriguing features such as superconductivity, magnetoresistance, and others. Because of their unusual structure, which makes them perfect for allowing low-cost, effective photovoltaics, these readily produced materials are viewed as the future of solar cells. They will also be used in next-generation electric car batteries, sensors, lasers, and other applications. A perovskite solar cell is a form of solar cell in which the light-harvesting active layer is a perovskite structured compound, most typically a hybrid organic-inorganic lead or tin halide-based material. Advantages Metal halide perovskites have unique features that make them appropriate for use in solar cells. Perovskite materials may be employed not only as a light-absorbing layer but also as an electron/hole transport layer due to its high extinction coefficient, high charge mobility, long carrier lifetime, and long carrier diffusion distance. Raw materials and production technologies (such as different printing techniques) are both affordable. Ultrathin sheets as thin as 500 nm may absorb the whole visible sun spectrum due to their high absorption coefficient. Using this compositional flexibility, scientists may create perovskite crystals with a wide range of physical, optical, and electrical characteristics. Ultrasound machines, memory chips, and, most recently, solar cells all use perovskite crystals. When these properties are combined, low-cost, high-efficiency, thin, lightweight, and flexible solar modules may be created. Perovskite solar cells are being employed to power low-power wireless circuits used in ambient powered internet of things applications. While perovskite solar cells have grown extremely efficient in a relatively short amount of time, they still face a number of obstacles before becoming a viable commercial technology. However, State-of-the-art PSC technology has a long way to go before it is commercially viable. PSCs are weak and durable, in addition to having a low electrical conversion efficiency. Furthermore, they contain trace levels of lead, which is harmful to the environment. BIPV solar technology Traditionally, solar is installed on the roof of a building, which is known as building-applied PV. However, more architects are learning how to integrate solar cells and modules into items such as curtain walls, roof tiles, and railings. BIPV stands for building-integrated photovoltaics. BIPV is an exciting new technique in solar energy generation. The concept is to naturally combine solar power plants with building design. These integrated solar systems may minimise the consumption of fossil fuels, save money on materials and power, and add architectural flair to a structure. The elements utilised in BIPV construction can not only generate power, but also protect the building from rain and wind, as well as increase thermal and acoustic insulation. They may also be utilised for a variety of purposes such as facades, rooftop canopies, and balconies. They can aid in GRIHA (Green Rating for Integrated Habitat Assessment), India's green building rating, by minimising solar heat gain on a building and thereby lowering the temperature of the building, resulting in decreased air conditioner demand. Because industrial buildings and organisations are reported to consume over 40% of all energy, BIPV might turn out to be a sustainable option that can help reduce greenhouse gas emissions. Some of the potential applications for BIPV technology in buildings include: Tile: Photovoltaic modules can be used to replace cement or clay tile on a building's roof. Solar radiation can flow through electric tiles, although they are virtually indistinguishable from regular roof tiles. Roofing Roll Coverage: A thin-film laminate that combines the qualities of bitumen covering and the solar battery is the ideal soft tile or roofing coverage substitute. Wall Panels: Instead of traditional wall panels, modern architects are increasingly employing solar batteries as façade panels. Windows (Glazing): "Solar Windows" are transparent thin-film solar batteries that can be adhered to glass, however their poor productivity is an issue. However, efforts are presently being made to integrate photo-electric components directly into the glass itself. All of these BIPV modules may be simply installed as rooftops, facades, curtain walls, carports, and parking lots in residential, commercial, and industrial structures. BIPV systems can either be connected to the utility grid or intended to operate independently.Many BIPV module manufacturers in India can provide BIPV modules that can replace conventional construction materials while also delivering utility-grade power. Semi-transparent BIPV modules manufactured by HHV Solar have created new landscapes in green construction. Other firms, such as Navitas Solar and Maglare, specialise in the glass panels of BIPV modules that can replace glazing parts of the building, while Novergy Solar, a BIPV solar panel expert, provides a wide selection of BIPV solar panels that can be integrated with the design of the structure. This game-changing technology elevates solar power and sustainable living to new heights. It enables architects, designers, and clients to incorporate hi-tech features into traditional building designs, transforming the structure into an appealing energy-generating structure. Solar Skins The adage "looks don't matter" is rarely applicable in the solar sector. Solar panels are typically designed to be visually appealing. The finest companies provide panels that are visually appealing and blend nicely with most traditional rooftops. However, when placed on rooftops, as is frequently the case, the majority of solar panels on the market do not integrate well with the majority of rooftops. They make their presence known on roofs in potentially unsightly and distracting ways. Sistine Solar was developed in 2012 by graduate students at the Massachusetts Institute of Technology (MIT). They sought to expand the effect of Industrial and UX Design into the solar technology sector and produce superior product aesthetics, which they claim might lead to increased sales. The fruits of their labour led to the solar skin When exposed to sunlight, solar skin is a flexible, translucent material that is very thin yet very effective at creating an electrical current. Consider it a thick strip of saran wrap that can be placed to practically any surface—the exterior of a house, a car, a utility pole—almost anything! The applications might be expanded to include consumer electronics as well. Soon, solar skin for your smartphone will be available, and charging it will be as simple as placing it in direct sunshine. Solar skins are not the same as solar panels. They are very long-lasting graphic film appliqués that are tailored using a proprietary algorithm to aesthetically merge with an existing or new array of solar panels in ways that complement the roof aesthetic without compromising solar panel efficiency and productivity. Solar skin contains billions of small photoelectric particles known as 'Quantum Dots.' When these particles are exposed to photons, which are the primary constituents of sunshine, they get excited. The problem with solar skin up to this point has been its low efficiency. However, researchers at the University of Queensland have discovered a means to increase this efficiency by 25%, resulting in solar skin with an overall efficiency rating of 16.6 percent. This indicates that 16.6 percent of the potential solar energy exposed to the solar skin is efficiently transformed into electricity. High-efficiency solar panels, on the other hand, are around 19-22 percent efficient. This implies that solar skin is rapidly reaching "prime time" for commercial and residential applications. Solar fabric When exposed to light, photovoltaic (PV) cells embedded in solar cell fabric create energy. Traditional silicon-based solar cells are costly to produce, inflexible, and brittle. Thin-film cells and organic polymer-based cells, while less efficient, may be made fast and cheaply. They are also malleable and may be sewn onto cloth. According to a New Scientist article, researchers created a small cylindrical cell by building a PV cell in the layers around a fibre. Solar gathering is no longer restricted to rooftops and poles; it may now operate quietly and unobtrusively from ordinary things. Humanitarian help can benefit from flexible solar cells. The PowerShade, a temporary shelter invented by PowerFilm, Inc., can generate one kilowatt of power. This might be useful for powering emergency equipment in remote locations on short notice. Konarka Technologies makes a thin film polymer-based PV cell that is sewn into a cloth. Further research on nanocrystal PV cells will be required to make these cells even smaller. In principle, nanotechnology might allow cells to gather a wider range of photons, boosting efficiency while shrinking. Konarka is collaborating with other institutions on this. Photovoltaic noise barriers (PVNBs) Photovoltaic noise barriers (PVNBs) are a hybrid of noise barrier and photovoltaic (PV) systems. Noise barriers are physical barriers that are used to reduce noise levels between noise sources and sensitive receptors such as hospitals, schools, and residential areas. Solar cells are used in photovoltaic systems to convert light energy directly into electricity. PVNBs, which were first used in Switzerland in 1989, are now seen in a number of nations where transportation authorities have tried to reduce noise while also producing renewable energy. The research on PVNBs, the most of which is many years old, largely agrees that there is tremendous potential to create solar electricity using both current and proposed new noise barriers. A highway noise barrier is a physical barrier built between the highway noise source and the noise sensitive receptor(s) that reduces noise levels near the receptor in decibels (dB). Noise barriers include stand-alone walls, berms, and combined berm/wall systems made of various materials such as soil, wood, concrete, and metal. They dampen noise by reflecting it back across the roadway or requiring it to take a longer route over and around the barrier. Although they do not fully eliminate noise, noise barriers often lower total noise levels by 5 to 10 dB, essentially cutting traffic noise in half. The photovoltaic noise barrier (PVNB), also known as the solar noise barrier, is a mix of noise barrier systems and photovoltaic (PV) systems that employ solar cells to directly convert light energy into electricity. PVNBs can be either retrofitted into existing noise barriers with PV modules (i.e., solar panels) or integrated into the construction of new noise barriers. The noise barrier acts as a substructure for PV modules in both scenarios. The most typical PVNB solution is top-mounted, retrofit designs that provide extra area to an existing noise barrier structure. SOLAR: A PROMISING FUTURE Previously, solar energy was solely generated by ground-mounted or rooftop panels. However, as a result of the developments outlined above, solar will become lighter, more flexible, and applicable everywhere. Imagine you had all of this technology and you go to another city. You can buy food from a solar-powered food cart, eat it while driving down a solar-powered highway, and charge your phone with solar-powered clothing. This is how the near future seems! In fact, many additional revolutionary household solar solutions are in the works or will be available in 2022. Perovskite solar cells, which might soon be used to make solar paint, are one of the most promising new technologies. Previous Next

Read more about people, the board of directors at Podar Eduspace, and look deeper into the history of Podar Eduspace, Anandilal Podar Trust and Podar Enterprises. Here to educate India. Podar Eduspace Our mission We aspire to reduce unemployment by creating a knowledge ecosystem where students and young professionals can upskill to stay relevant in this dynamically changing job landscape. Podar Enterprise Podar Enterprise has relentlessly pursued its vision to make a difference by contributing to India’s interest at home and abroad. Established in 1909, the group today represents a 100-year legacy of trust, quality and reliability - in India and internationally. Read more Anandilal Podar Trust To contribute to education in a young India, great visionaries and philanthropists: Pandit Madan Mohan Malviyaji, Shri Jamnalal Bajaj and Shri Anandilal Podar came together to establish the Anandilal Podar Trust in 1921. It is of utmost pride to us that Mahatma Gandhiji himself was the Chairman Trustee. Read more Podar Eduspace Podar Eduspace is the educational pillar of Podar Enterprise focusing on student programs ranging from research, volunteering, skill development & advisory to educational institutes. Read more Our People Meet the people who made all of this possible. Read more Meet our Board of Advisors Our Board Meet our Board of Advisors. Read more

Podar Enterprise has relentlessly pursued its vision to make a difference by contributing to India’s interests at home and abroad. Established in 1909, the group today represents a 100-year legacy of trust, quality and reliability - in India and internationally. Acerca de About Podar Enterprise Podar Enterprise has relentlessly pursued its vision to make a difference by contributing to India’s interest at home and abroad. Established in 1909, the group today represents a 100-year legacy of trust, quality and reliability - in India and internationally. Over the years, Podar Enterprise has expanded into multiple sectors with a strong presence in 15 locations across the world: offering unique opportunities for trade, investment and joint ventures. Our expertise lies in Government Relationships, Advisory & Consulting, Education, International Business, Investment & Strategic Partnerships, Affordable Housing & Sanitation, and Sports. Key milestones 1909 Established in 1909, the group today represents a 100-year legacy of trust, quality and reliability - in India and internationally. 1997 Past Chairman Mr. Kantikumar R. Podar was the first Indian President of SAARC and former President of FICCI . Current Managing Director, Mr. Rajiv K. Podar, is the former President of IMC , and is the Representative to multiple governments worldwide. Podar subsidiaries are the Official Trade Houses for Moscow Regional Administration, Republic of Belarus and Republic of Benin. 2000 Strategic partner for enabling a line of credit for ECOWAS Development Bank (Africa) from the Government of India. 2005 2008 The first and exclusive partner for Cricket Australia’s Cricket Education Program (CEP). 2014 Joint partnership with Covestro (formerly Bayer MaterialScience) to create durable, cost-effective solutions for those of lower socioeconomic status. 2016 Advisors to Russian HNWIs, Russian MNCs and Australian Finance Groups in recommending investment, acquisition and market-entry strategies in India. But the group’s greatest milestone is that it prides itself in having built a team that is inventive, hardworking, and committed to high morals. It strongly believes that there is no substitute for hard-work, trust, and commitment. They aspire to continue growing and giving back to the nation, through quality service across generations. "Reboot the business, reboot the policies, reboot the economy." - Rajiv Podar

We work with marginalized youth, women, specially-abled, school & college drop-outs in both rural and urban India. Our industry-connected skilling model will create a visible impact on the lives of over a million uneducated & unemployed youth who enter the workforce each year. Acerca de Skill Development Through our skilling initiatives we aim to work with the Government of India and MNCs to provide skilling to urban and rural communities across India. Through this vision, we seek to work with Anandilal Podar Trust to contribute and give back to our nation. The Anandilal Podar Trust, established in 1921, the flagship philanthropic initiative of Podar Enterprise has 100+ years of outstanding services towards society at large. APT has been running multiple schools, colleges, Private ITI, Sports Complex and have been front runners in setting up schools and vocational training for the differently abled. Since 2014, APT has engaged with National Skill Development Corporation (NSDC) , under the Ministry of Skill & Entrepreneurship as PIA for projects like Star, PMKVY. APT also empanelled under Rajasthan Skill & Livelihoods Development Corporation (RSLDC) for implementing skill based training in the healthcare sector. Our objective is to impact the lives of underprivileged youth by providing them skill, employment and livelihood. We have been implementing partners for large scale government projects including: PMKVY and RSLDC. We engage with corporate sector and PSU's as their preferred partner for implementing CSR Projects across pan-India. We work with marginalized youth, women, specially-abled, school & college drop-outs in both rural and urban India. Our industry-connected skilling model will create a visible impact on the lives of over a million uneducated & unemployed youth who enter the workforce each year. We also aspire to give back to society and contribute to India in becoming the Skill Capital of the World . We are working with the Sector Skill Council for People with Disabilities in states like Maharashtra and Rajasthan to train disabled candidates (hearing, sight and locomotive disabilities) and are employing them in various sectors like logistics, telecommunication, etc. Our Focus Sectors Are – Logistics, Telecommunication, Technology and Energy

< Back Banking and the Future of Indian Banking by Samaira Dayani The banking sector is poised to grow at a rapid pace by digitizing financial services dissemination, further formalizing credit to micro, small and medium enterprises (MSMEs), adopting innovative digital operating models, adapting to the continuously evolving landscape, benefiting from the adoption of emerging technologies, and driving consumption-fueled growth for our economy. BASICS OF INDIAN BANKING SYSTEM Introduction - Central Banks and Commercial Banks Commercial Banks Commercial and central banks are essential parts of the country’s economy. While commercial banks deal directly with the end users, central banks offer their products and services to the government and other commercial banks. A commercial bank is a type of financial institution that provides various banking services to individuals, businesses, and other organizations. These services include accepting deposits, making loans, and facilitating the transfer of funds. Commercial banks also offer a wide range of other financial services such as issuing credit and debit cards, providing online and mobile banking, and offering investment products. They accept deposits from customers and use these funds to make loans to businesses and individuals. They also earn a profit by charging interest on loans and paying lower interest on deposits. Some commercial banks offer safe deposit boxes or vaults for customers to store valuable items, such as documents, jewelry, and other valuables. Commercial banks ensure liquidity by taking the funds that their customers deposit in their accounts and lending them out to others. Commercial banks play a role in the creation of credit, which leads to an increase in production, employment, and consumer spending, thereby boosting the economy. Central Banks A central bank is a financial institution that is responsible for overseeing the monetary policy of a country. The meaning of central bank is a financial institution that has the privilege of producing and distributing money (and credit) for a country or a group of countries. It acts as a regulator and supervisor of the country's financial system, and is typically responsible for issuing and controlling the supply of currency, managing the country's foreign exchange reserves, and acting as a lender of last resort to commercial banks. The main functions of a central bank include maintaining price stability, ensuring the smooth functioning of financial markets, and promoting economic growth. The Reserve Bank of India (RBI) is the central bank of India.It is an apex body that controls, operates, regulates, and directs a country’s banking and monetary structure. Roles and Functions of the RBI The Reserve Bank of India was established on April 1, 1935. The RBI is completely owned by the government of India. The following are some of the vital functions of the RBI: ● Monetary Authority : It formulates, implements and monitors the monetary policy. The objective is to maintain price stability while keeping in mind the objective of growth. ● Issuer of currency : RBI is the authority who issues notes, destroys the old notes and decides which currency is fit for circulation among the people. It also puts coins minted by the Government of India into circulation. The objective is to give the public an adequate quantity of supplies of currency notes and coins in good quality. ● Custodian and Manager of Foreign Exchange Reserves : In order to stabilize the external value of Indian currency, the RBI maintains the reserves of foreign currencies to stabilize the exchange rate. The objective is to facilitate external trade and payment and promote orderly development and maintenance of the foreign exchange market in India. ● Lender of Last Resort : It also acts as a lender of last resort for the Scheduled Commercial Banks (SCBs). Usually, banks and other financial institutions borrow and lend among themselves to meet their financial needs. But, in times of crisis, the SCBs approach the RBI to get financial assistance. ● Banker to the Government : The RBI being the apex monitory body has to work as an agent of the central and state governments. It performs various banking functions such as accepting deposits, and taxes and making payments on behalf of the government. It works as a representative of the government even at the international level. Monetary Policy: Monetary policy is a set of tools used by a nation's central bank to control the overall money supply and promote economic growth, as well as to control inflation. The following are some of the tools used by the Reserve Bank of India to control the flow of money: ● CASH RESERVE RATIO/ CRR: The cash reserve Ratio is a particular minimum amount of the total deposits of customers that need to be maintained by the commercial bank as a reserve either in cash or as deposits with RBI. The CRR rate will be fixed as per the guidelines of the Central Bank. It ensures the liquidity system is consistent and maintained well in all commercial banks. RBI gets to control and coordinate the credit maintained by banks through the CRR rate which helps to have a smooth supply of cash and credit in the economy. When the CRR rate is reduced by RBI, commercial banks can offer more advances to borrowers which in turn increases the flow of cash to the public. Another objective of CRR is to keep inflation under control. During high inflation in the economy, RBI raises the CRR to reduce the amount of money left with banks to sanction loans. It squeezes the money flow in the economy, reducing investments and bringing down inflation. As of 2024, the CRR is at 4.5%. This rate has been stable since early 2023. The CRR was reduced to 3.0% in 2020 during the COVID-19 pandemic to increase liquidity in the banking system. Post-pandemic, the CRR was increased to 4.0% in 2021 and then to 4.5% in 2022 and 2023 as the economy began to recover and the RBI shifted its focus to managing inflation and ensuring economic stability. ● STATUTORY LIQUID RATIO (SLR): SLR requires commercial banks to keep a certain amount of their money invested in specific central and state government securities. It is the minimum percentage of deposits that a commercial bank has to maintain in the form of liquid cash, gold or other securities. One of the main objectives is to prevent commercial banks from liquidating their liquid assets when the RBI raises the CRR. SLR also helps RBI control inflation. Raising SLR makes banks park more money in government securities and reduce the level of cash in the economy. This helps raise price levels and inflation in the economy. Doing the opposite helps maintain cash flow in the economy. Reducing SLR leaves more liquidity with banks, which in turn can fuel growth and demand in the economy. As of January 29, 2024, the current SLR in India is 18%. In recent years, the SLR has been gradually reduced to promote more lending and stimulate economic growth. For example, the RBI reduced the SLR from 19.5% to 18.0% over the past few years. From 2015 to 2019, the RBI steadily decreased the SLR from around 21.5% to 18.75%. ● REPO RATE: The Repo Rate is the interest rate at which the Reserve Bank of India (RBI) loans money to commercial banks. The repo rate is utilized by the Indian central bank to restrict the flow of money in the market. When the market is impacted by inflation, the RBI raises the repo rate. An increased repo rate means that banks borrowing money from the central bank during this period will have to pay more interest. This inhibits banks from borrowing money, reducing the amount of money in the market and helping to negate inflation. The repo rate is a critical tool used by central banks to manage the economy and maintain financial stability. When the economy slows down, central banks can lower the repo rate to make borrowing cheaper and encourage investment and spending. This can help to stimulate economic growth. ● REVERSE REPO RATE: The reverse repo rate is the rate at which the RBI borrows funds from the country's commercial banks. This aims to absorb the liquidity in the market, which helps restrict the borrowing power of the investors. When faced with high levels of inflation, the RBI increases the reverse repo rate, thus encouraging banks to park more funds with the RBI. Controlling inflation is a crucial goal of central banks. Central banks can use the reverse repo rate to influence the money supply and overall economic liquidity. Reducing liquidity through the reverse repo rate can help control inflation by limiting the money available for spending and borrowing. The current reverse repo rate is 3.35%. In December 2019, the reverse repo rate was 4.90%. It continued to decrease in 2020 and reached 3.35% in December of the same year. Ever since, the rate has remained the same. Digital Banking Online banking means accessing banking features and services via your bank’s website from your computer. You may log into your account to check your balance or pay your electricity bill. You can access additional banking features, such as applying for a loan or credit card, at many banks via your online banking portal. Digital banking means to digitize all the banking operations and substitute the bank's physical presence with an everlasting online presence, eliminating a consumer's need to visit a branch Online banking in the U.S. has its roots back in the 1990s. In October 1994, Stanford Federal Credit Union was the first institution to let its customers access banking functions via the new World Wide Web. By the time the 21st century rolled around, it’s estimated that 80% of U.S. banks offered their customers the ability to bank online. The following are the different types of digital banking: ● UPI Transactions (Unified Payments Interface)- This allows money transfer from your bank account using a single window directly to the vendor from your mobile. Several bank accounts can be linked with one app. It enables individuals to transfer money instantly between bank accounts using their smartphones. UPI eliminates the need for traditional methods like cheques or net banking processes. UPI allows for the user to transfer the funds instantly between the bank accounts linked to the UPI platform. Some of the apps allowing UPI services in India are GooglePay, BHIM app, PhonePe, FreeCharge, Cred, etc. ● Mobile Banking- Mobile banking means using an app to access many of those same banking features via mobile devices such as smartphones or tablets. These apps are proprietary, issued by the bank where you hold your account, and usually use the same login information as your online banking portal. Mobile banking enables clients and users to carry out various transactions, which may vary depending on the institution. Mobile banking is very convenient in today’s digital age with many banks offering impressive apps. The ability to deposit a check, to pay for merchandise, to transfer money to a friend or to find an ATM instantly are reasons why people choose to use mobile banking. However, establishing a secure connection before logging into a mobile banking app is important or else a client might risk personal information being compromised. Using a mobile banking application, you can easily access your banking account, check balance, transfer funds, pay bills, deposit checks, etc. Overall, you can access almost all products and services provided by your banking institution. Plus it’s convenient to use, allowing you to check your banking account 24/7, conduct financial transactions or tasks whenever you are connected to the internet. ● ATM (Automated Teller Machine)- An automated teller machine or ATM cash dispenser can be defined as an electronic banking outlet that enables customers to complete routine transactions without the assistance of a branch representative. These days any person who owns a credit or a debit card can access cash at several ATMs in a hassle-free manner. ATM machines are a convenient and secure node, allowing many consumers to undertake quick self-service transactions. Modern ATMs provide a strong and substantial payment infrastructure in smaller towns, especially in emerging markets, contributing significantly to financial inclusion. Using an ATM simply involves inserting your bank-issued ATM card, entering your personal identification number (PIN) and following the prompts on the screen to complete your desired transaction. Firstly, they provide convenient 24/7 access to our bank accounts, allowing us to withdraw cash or perform transactions at any time. This eliminates the need to visit a physical bank branch during its working hours. Additionally, ATMs are often located in various locations, making them easy to access in emergencies or when we are travelling. Furthermore, ATMs have simplified banking procedures, reducing the dependence on human tellers. They allow us to perform routine transactions quickly and efficiently, saving us time and effort. ● Summary of Digital Banking According to Statista, the digital banking sector will grow continuously over the next five years. This trend reflects the ongoing development and expansion of digital banking services in the foreseeable future. The following are some of the merits of digital banking: ● Convenience Digital banking enables consumers to perform banking functions from the comfort of their homes, be it an older individual who is worn out on waiting in lines or a working-class professional who is caught up with work, or a regular individual who would not like to visit the bank's branch to run a single task. It also offers convenience. ● Easily Accessible Digital banking allows a user to carry out banking work around the clock, with 24*7 availability of access to banking functions. ● Paperless Transactions Probably the biggest drawback of traditional banking was the excessively placed importance on paper. Banking has become paperless with the advancement of digital banking as a service. A user can sign into their account at any point on schedule to monitor records. ● Automatic Payments Digital banking allows a user to set up automatic payments for regular service bills like power, gas, telephone, and credit cards. The customer no longer has to make a conscious effort to remember the due dates. The customer can choose alerts on upcoming payments and outstanding dues. The graph below shows the comparison between the channels used for investment transactions. The following are some of the demerits of digital banking: ● Downtime If you rely solely on an online bank, you could be challenged to access your accounts should your bank experience an online or mobile app outage and there’s no branch for you to visit instead. ● Security There’s always the chance that your username and password could be hacked; however, online banks pursue the same degree of risk-reducing security protections, such as multi-factor authentication, as brick-and-mortar banks do. However, neither system is completely safe, and hacked accounts can result in identity theft due to stolen login credentials. ● Tech Related Service Disruption If your internet service is delayed or unavailable for a while, it will limit your ability to access accounts online. Similarly, you won't be able to access your banking information over the Internet or a mobile device if the bank's servers crash or become momentarily inaccessible as a result of planned site maintenance. ● Limited Services You might be able to submit an initial application for a new account, a loan, or a mortgage online, but you will often need to go to a branch to sign documents and provide identification. Similarly to this, even if you may transfer funds to a checking account or debit card to make purchases, you'll need to go to a branch office or an ATM close by if you need cash. Conclusion – Indian Banking System and Economy at a Large : Future The banking sector is poised to grow at a rapid pace by digitizing financial services dissemination, further formalizing credit to micro, small and medium enterprises (MSMEs), adopting innovative digital operating models, adapting to the continuously evolving landscape, benefiting from the adoption of emerging technologies, and driving consumption-fueled growth for our economy. The imminent growth of 5G internet usage, deeper smartphone penetration, expansion of digital payments, frictionless data-led digital lending, risk-mitigated secure data protection, and accelerating Enhanced Access and Service Excellence (EASE) reforms, climate-conscious sustainable goals and collaboration between banks and FinTechs will enable the next wave of technology-fueled innovation in banking services in India. The future state of the Indian Banking lies in the modernisation of the core banking system. Introduction of new, better and agile technologies is carving out new paths of growth and optimization. The increased competition, unprecedented situation and the new normal arising out of the pandemic, will prompt the banking system to stay relevant and banking as we know might undergo a revolutionary change with a paradigm shift. Banking will be more lifestyle oriented and banks will look to extend their core systems to kick-start growth by launching new products, build digital experiences, and augment operational efficiency by leveraging the likes of AI, machine learning and cloud technologies. These would include themes like digital on boarding and quick loan disbursals. References Central and commercial banks: https://www.shiksha.com/online-courses/articles/difference-between-central-bank-and-commercial-bank/ https://testbook.com/key-differences/difference-between-central-bank-and-commercial-banks-in-india#:~:text=The%20main%20difference%20between%20the,customers%20and%20making%20a%20profit . https://www.investopedia.com/terms/c/commercialbank.asp https://www.vedantu.com/commerce/functions-of-central-bank Roles of rbi: https://www.rbi.org.in/commonperson/English/Scripts/Organisation.aspx https://www.nextias.com/blog/reserve-bank-of-india-rbi/ http://www.jnpg.org.in/WebDoc/EContent/Company_Account/Functions%20of%20RBI.pdf Monetary policy tools: https://cleartax.in/s/cash-reserve-ratio-crr https://byjus.com/free-ias-prep/cash-reserve-ratio/#:~:text=CRR%20rate%20is%20the%20minimum,time%20liabilities%20of%20each%20bank https://www.ceicdata.com/en/indicator/india/reserve-requirement-ratio https://www.ceicdata.com/en/india/bank-interest-rate/cash-reserve-ratio https://byjus.com/free-ias-prep/slr/ Digital banking: https://www.forbes.com/advisor/in/banking/what-is-digital-banking/ https://www.bankofbaroda.in/banking-mantra/digital/articles/types-of-digital-banking https://www.bankrate.com/banking/what-is-an-atm/ https://sdk.finance/what-is-digital-banking/ https://www.viirj.org/vol12issue2/45.pdf https://www.bankbazaar.com/ifsc/upi-payment-app.html https://www.javatpoint.com/advantages-and-disadvantages-of-online-banking Future of the Indian Banking system: https://www.pwc.in/assets/pdfs/consulting/financial-services/fintech/publications/shifting-horizons-banking-readiness-for-2030.pdf https://www.resurgentindia.com/pdf/Future-of-Indian-Banking-The-Road-Ahead.pdf Previous Next

< Back Consumer Pricing Behavior: An In-depth Analysis of Price Perception and Decision-Making by Samaarra Agarwal Consumer pricing behavior is a key and complex component of the contemporary market. Here, we analyze how people make decisions in their quest of value, which sits at the nexus of psychology, economics, and marketing. Abstract Consumer pricing behavior is a key and complex component of the contemporary market, influencing the dynamics of companies, markets, and economies all over the world. A fascinating perspective through which to analyze how people make decisions in their quest of value is provided by this topic, which sits at the nexus of psychology, economics, and marketing. Consumers today have more power than ever because of an abundance of options and unmatched access to information, and their pricing behavior has changed as a result. This paper explores the complex world of consumer price behavior with the goal of illuminating the different forces, motives, and influences that influence people's decision-making around pricing. As buyers, we continually assess pricing, contrast items, and look for the greatest offers, all of which have an impact on the things we buy. Understanding these nuances is essential for both politicians working to establish a just and consumer-friendly economic climate as well as businesses trying to prosper in cutthroat marketplaces. 1. Introduction Consumer pricing refers to the various prices paid by buyers of a good or service. The study of consumers and the methods they employ to select, use (consume), and discard goods and services, as well as the emotional, mental, and behavioral responses of consumers, is known as consumer behavior. For firms to develop powerful marketing tactics that may affect customers' decision-making processes, understanding consumer behavior is essential. Businesses may target certain demographics with their marketing campaigns, increase customer loyalty, and spot new trends by studying consumer behavior. Additionally, by using this information, organizations may stay one step ahead of the competition and adjust to shifting consumer preferences. Every effective marketing plan must take into account customer behavior. Businesses may create efficient marketing strategies that satisfy the demands of their target market by researching the elements that affect customer behavior. Understanding consumer behavior is crucial for marketers because it enables them to better communicate with customers. They can close the market gap and pinpoint the items that are required and the products that are no longer in use by knowing how customers choose a product. Marketing professionals may display their goods in a way that has the most influence on consumers by researching consumer behavior. Understanding consumer purchasing behavior is the key to connecting with, involving, and convincing potential customers to make a purchase from you An examination of customer behavior should show: What consumers think and how they feel about various alternatives (brands, products, etc.)? What influences consumers to choose between various options? Consumers’ behavior while researching and shopping? How consumers’ environment (friends, family, media, etc.) influences their behavior? Numerous factors frequently affect consumer behavior. Marketers should research customer buying trends and purchase behaviors. Most of the time, companies only have control over certain factors that affect customer behavior. There are three categories of factors that influence consumer behavior: Personal factors: Demographics (age, gender, culture, etc.) can have an impact on a person's interests and attitudes. Psychological aspects: a person's views and attitudes will determine how they react to a marketing message. Social variables such as family, friends, money, level of education, and social media all affect consumer behavior. 2. Consumer behavior There are 4 main types of consumer behavior which include: Complex buying behavior: When consumers purchase expensive, occasionally purchased goods, they exhibit this kind of behavior. They play a significant role in the research that customers do before making a high-value investment. Consider purchasing a home or a vehicle; these are examples of complicated purchasing behaviors. Dissonance- reducing buying behavior: Despite being heavily involved in the purchasing process, the customer finds it challenging to distinguish different brands. Dissonance can happen when a customer fears they will regret their decision. Consider purchasing a lawnmower. Choosing one will be dependent on cost and convenience, but once you've made the purchase, you'll want to be sure you picked the appropriate one. Habitual buying behavior: Consumers who make habitual purchases show relatively little interest in the product or brand category. Consider going grocery shopping: you visit the store and purchase the bread of your choice. You don't have a strong brand loyalty; you just act in a repetitive pattern. Variety- seeking behavior: In this instance, a customer buys a different product because of desire for variety rather than dissatisfaction with the prior one. like when you experiment with different smells of shower gel. There are multiple factors that affect consumer behavior for instance: 1. Promotional efforts Purchase decisions are significantly influenced by marketing initiatives. They can even encourage customers to switch brands or choose more costly alternatives if done well, consistently, and with the proper marketing message. Marketing initiatives, like Facebook advertisements for eCommerce, may also serve as reminders for goods and services that must be purchased frequently but aren't always front of mind for customers (like insurance, for instance). Impulse purchases might be influenced by a persuasive marketing message. 2. Economic conditions Economic factors play a significant role, particularly for expensive goods (like houses or vehicles). Regardless of their financial obligations, customers are known to become more self-assured and prepared to indulge in purchases in a healthy economic climate. For more expensive purchases, the decision-making process takes longer and is subject to more subjective influences. 3. Individual preferences Personal characteristics, like preferences, beliefs, morals, and priorities, can also have an impact on how consumers behave. Personal views are extremely potent in sectors like fashion or food. Advertisements may undoubtedly affect behavior, but ultimately, consumer preferences have a big impact on their decisions. No matter how many advertisements for burger joints you see, if you're a vegan, you won't start eating meat as a result. 4. Societal impact Consumer behavior is also influenced by peer pressure. Our decisions may be greatly influenced by what our friends, neighbors, close friends, coworkers, and family members believe or do. Consumer behavior is impacted by social psychology. For instance, choosing fast food over prepared meals is one such instance. Social and educational aspects can influence one another. 5. Purchasing power Not to mention, our ability to buy things has a big impact on how we behave. You will think about your budget before making a buying choice unless you are a billionaire. Even if the product is top-notch and the marketing is spot-on, you won't buy it if you can't afford it. Marketers will be able to identify eligible consumers and provide better outcomes by segmenting consumers based on their purchasing power. 3. The influence of price on demand Demand refers to the quantity of goods consumers are willing and able to buy at different price levels, in a given period of time, ceteris paribus. The price of a product and its demand are negatively correlated; when price increases, demand decreases and vice versa. The figure below illustrates this relationship. Fig 1: Demand curve The quantity demanded of goods and services are shown on the x axis while the price of goods and services are on the y axis. When the price was P A the quantity demanded was Q A shown by point A. However, when the price decreases to P B the quantity demanded increases to Q B shown by point B. This indicates that when price increases, consumers are willing and able to buy less of the goods as it becomes more expensive for them, which affects their behavior. Hence, it is necessary for producers to supply the quantity of goods and services which is equal to the demand of the goods and services, known as the equilibrium quantity. The diagram below illustrates this. Fig 2: Equilibrium demand and supply point Fig 2 shows that the intersection of the demand and supply curve is the equilibrium point where quantity demanded is the same and quantity supplied. The equilibrium price is price p and the equilibrium quantity is quantity q. At this point there is allocative efficiency because the optimum amount of goods and services are being produced from society's point of view. 4. Behavioural Economics Conventional economic models presuppose that customers make logical choices based on all available information, while behavioral economics acknowledges that humans frequently depart from this idealized behavior as a result of social influences, emotional variables, and cognitive biases. Anchoring: When making decisions, consumers frequently use the first piece of information they learn as an "anchor" and base their future choices on it. In terms of pricing, this means that consumers' opinions about whether or not a product or service is a good value can be significantly influenced by the price they initially see for it. Loss Aversion: Individuals often experience greater sorrow from losses than happiness from wins. Customers may be less receptive to price reductions than price rises, which means that this concept affects how they behave while making pricing decisions. Mental Accounting: People frequently divide up their finances into several mental accounts, such as "savings," "entertainment budget," and "grocery budget." Irrational behavior may result from this, such as being prepared to spend more in one area while practicing modest living in another. Prospect Theory: This theory describes how individuals assess possible results. It implies that buyers are more perceptive to shifts in their financial situation and could be willing to take on greater risk in order to minimize losses. This may have an impact on how customers view sales and discounts, which has consequences for pricing strategies and decision-making. Herd Behaviour: People are frequently swayed by the actions of others, which results in herd mentality. Pricing and customer behavior may be impacted by this, since people may be more inclined to buy a product if they observe others doing the same. Endowment Effect: People regard things they already own more highly than they do new ones. People may be more hesitant to part with products at a certain price or may overvalue the objects they already own, which can have an impact on pricing tactics. Confirmation bias : The tendency for consumers to reject information that contradicts their prior opinions in favor of information that supports those assumptions. By offering data to bolster their assertions about price and products, marketers may take advantage of this prejudice. Effects of Framing: Presentational strategies have a big influence on how people behave. Decisions on what to buy can be influenced by different methods to communicate the same price, such as expressing it as a monthly cost rather than an annual cost. Choice Overload: When customers are overloaded with options, they might feel confused and find it tough to decide. Customers may find it easier to make decisions if price alternatives are made simpler. Nudge Theory: Nudges are subtle adjustments to the way options are shown that have the power to affect customer behavior without limiting their options. For instance, making healthier food alternatives more visible might promote better eating habits. 5. Apple case study One well-known example of a business that has successfully used customer behaviour to guide its pricing strategy is Apple Inc. The corporation is well-known for charging high prices for its goods, which include the iPad, iPhone, and Mac PCs. This case study looks at how Apple sets premium prices by taking advantage of customer behaviour and how it affects its market share and profitability. Apple's price approach contributes to the perception that their products are high-end and premium. Apple has established an image of exclusivity and luxury by playing on the psychology of customer behaviour. Consumers frequently believe that greater costs equal better quality, and Apple has established itself as a pioneer in this area. Consumer behaviour and buying decisions are influenced by this view. Elasticity of Demand: Apple is aware that their clientele, who are often called "Apple loyalists," have inelastic demand. This indicates that these customers stick with the brand and that their purchase habits are not much impacted by price increases. Apple maintains premium pricing without seeing a major decline in its client base by taking advantage of this inelastic demand. Apple has made significant investments in product differentiation. They evoke exclusivity by providing distinctive characteristics and a smooth ecology of goods and services. Consumer behaviour demonstrates that buyers are prepared to pay more for goods they consider to be exceptional or unique. Psychological Pricing: To make a product seem more accessible, Apple regularly uses psychological pricing strategies, such as placing costs slightly below a round number (for example, $999 instead of $1,000). This capitalises on the inclination of consumers to concentrate on the leftmost digits and believe that the product is within a cheaper price range. Revenue Maximisation: By raising the price of its products, Apple is able to maximise its revenue through pricing strategy. Apple continues to be very profitable even when its sales volume may be lower than that of competitors that offer alternatives at cheaper prices. Brand Loyalty: Apple has developed a strongly devoted following of customers by evoking an aura of exclusivity and excellence. Customer behaviour suggests that Apple customers tend to stick with the brand, which lowers the chance of customer turnover. Market Share: Due to its premium pricing approach, Apple, particularly in price-sensitive areas, does not achieve a substantial market share in terms of unit sales. Nonetheless, this is consistent with the business's emphasis on profit margins and the development of a unique market niche. Apple's pricing strategy, which prioritises innovation and product uniqueness, has enabled it to sustain a competitive edge. This sets Apple apart from rivals that compete mostly on pricing. Apple Inc.'s pricing approach serves as evidence of the significant influence that customer behaviour has on price determinations. With ramifications for its profitability and market position, Apple has maintained a premium pricing strategy that continues to be effective by understanding consumer psychology and utilising the concepts of perceived value, brand loyalty, and inelastic demand. In order to accomplish company goals, it is critical to match pricing tactics with customer behaviour, as this case study demonstrates. 6. Conclusion Consumers have more power than ever in an age characterized by a wealth of options and unmatched access to information. As a result, their pricing practices have changed, necessitating a thorough investigation of the different factors, incentives, and influences that shape their decision-making. As consumers, we constantly compare products, assess pricing, and look for the greatest offers; these actions have a significant impact on the things we purchase. This knowledge is critical for firms looking to prosper in fiercely competitive markets and for politicians trying to create fair and consumer-focused economic environments. Conclusively, the research undertaken on consumer pricing behavior indicates a multifaceted interaction of variables influencing people's decision-making in the marketplace. This complexity includes characteristics of the individual, the state of the economy, personal preferences, the impact of society, and purchasing capacity. Developing successful marketing strategies, focusing on certain demographics, and adjusting to shifting market conditions all depend heavily on an understanding of customer behavior. Together with the basic link between price and demand, the four main consumer behavior types found in this research offer useful information to companies looking to maximize their pricing tactics. Furthermore, behavioral economics' significant influence emphasizes how important it is for companies to take emotional and cognitive biases into consideration when determining pricing. In today's environment of consumer empowerment, with a wealth of options and easy access to information, responding to changing consumer behavior is indispensable for success. Previous Next

< Back International Marketing by Ananya Choksi Marketing in today’s world has become complex as many businesses now have their operations across continents. Mass marketing is now being replaced by focused marketing. Understanding the local marketing and keeping the sentiments of the different groups and communities in mind, marketing strategies require adaptation to the regional specifics. Marketing and Dynamics of International Marketing What is Marketing? As per the American Marketing Association, “Marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas and services to create exchanges that satisfy individual and organisational objectives.” Marketing entails the strategies and activities that businesses use to promote and sell their products or services. It involves understanding customer needs, creating value, and building strong relationships with consumers through various methods like advertising, market research, public relations, and sales strategies. Importance of Marketing to Any Business Marketing is critical to the success of any firm or organization. Once an idea is conceived, marketing plays an important role in delivering the end product or service to the consumer. A firm’s financial success often depends on how well a product is marketed and marketing creates demand for products and services help make profits. Other business functions such as finance, accounting and operations will not matter if there is not enough demand for a product. Either a product or service is created as the organization believes it will be able to create a niche market for the product or it is created based on the consumer needs and to fill the gap between consumer demand and the product. This could be better summarized through the Ansoff Matrix chart below. Marketing plays an important role as it through marketing that a business is able to create customer awareness about the product and what is the firm offering. It can build a brand if marketing is carried out well which in turn will drive the sales and the revenue of any business. Marketing helps to create a niche market for a new product and gives it the competitive advantage over its competitors. With right marketing skills a business can retain its customers and create brand loyalty. FACTORS AFFECTING MARKETING TECHNIQUES The marketing environment is influenced by a number of external elements such as the competitors, political and economic environment, social and cultural factors like use of language and holidays celebrated. These external forces are beyond the control of any organization but can have a profound impact on marketing success. However, these elements affect the sale of a product, how the product is sold and who will purchase them. Changes in an environment creates a market for new products and eliminates the old and existing products. Some of the factors that affect the marketing techniques are i) Social factors Changing social norms and demographics affect the market dynamics. Factors in the marketing environment correlate with changing social trends, consumer values and preferences. Let’s look at a few examples. Mexico has seen a rapid population growth whereas Japan is now seen as country with aging population. The demand for milk, diapers, school supplies and toys would be more in Mexico whereas Japan would need more of adult products. A demographic shift in women’s role in workforce [1] has had a profound effect on demand for childcare and consumer products and services that can save time and help to make life more convenient for families. From 1950 to 2000 there has been a 256.8 percentage change in women who have entered the labour force in the United States. This has driven up the demand for childcare and housecleaning services and products that save time in cooking and other household chores. India has seen a growing trend in the rise in nuclear families. As per the Hindu, at the all-India level, 50 per cent of the were nuclear in 2022, as compared to 37 per cent of households in 2008. [2] This has given rise to premiumisation in choice of household products and also housing demand. ii) Cultural factors Culture is one of the fundamental determinants that provide a specific identification to its members. It includes nationalities, religions, racial groups and geographic regions. Companies capitalize on well thought out multicultural marketing strategies. One of them is localization. Localization can be of two types – content localization and product localization. Content Localization refers to change the textual and visual content of a product or service like advertisements, user interfaces on the website keeping in mind the cultural nuances in a particular region A business that wants to be a global enterprise needs to take the language needs of different regions into consideration. If an American brand wants to sell its products in a Japanese market, then it needs to ensure that it adapts and contextualizes the message in Japanese as it will resonate more with the people of Japan. It will ensure clarity and cultural relevance.. In India, a majority of the population does not speak English. According to a research, majority of the Indian internet users prefer to read in their native or regional language over English. The Navbharat Times, one of the leading newspapers in India, enabled its users to read the news in Hindi on its website. This showed an increase of 2.4 times from March 2019 to March 2022 reaching nearly 78 million visitors. In the last few years, it has enabled news reading in seven other languages. Even companies like Facebook support 13 regional Indian languages. This has enabled the company to have the second highest number of users in the world after United States. Product Localization means altering the features and the functionalities of a service or a product keeping in mind the local preferences, tastes and restrictions. For example, Domino’s in Malaysia ensures that it uses halal meat to meet the local dietary restrictions. To increase global viewership and culturally relevant entertainment, Netflix creates original content in various languages and tailored for specific region. Sometimes if the content becomes very popular, it is provided with subtitles or dubbed in different languages. McDonald’s, which has been around for more than sixty years can attribute its success to its localization efforts. In India, it excludes beef from its product and its menu is catered to the local palette and a lot of vegetarian options. In Japan it serves the “Teriyaki Burger” and in China it offers the “McLobster” sandwich, which features its locally sourced seafood. iii) Political and Economic Factors Marketers must work within the laws regulating the business practices and within the government policies. The economic factors such as the economic climate, inflation, taxation, shift in consumer spending all affect the marketing strategies adopted by companies. Import quotas are placed to help the domestic suppliers and limit imports. This tends to increase prices of the imported products. For example, if a United States limits the number of Japanese car imports to three million a year, this would mean higher price for Japanese cars. In Italy, Florence has banned new Airbnb listings in its historic centre and Italy is considering tightening the rules nationwide. In Amsterdam, a property can be rented for a maximum of 30 nights per year. This forces the company to revise its marketing strategy. [3] Uber has committed to become a fully zero-emission platform by 2040 after environmental treaties and regulations were imposed by several countries. [4] iv) Celebration of Holidays The Black Friday sale after the Thanksgiving Holiday is one of the biggest event where most businesses resort different marketing campaigns to increase their sales and revenue. Different traditional and digital tactics are applied by small and large businesses to generate hype about different products. During the festival of Diwali in India, many jewellers promote lucrative offers to promote sales for example they have zero jewellery making charges. According to Business Standard, Diwali sales in 2024 would hit 4.25 trillion. [5] a most recent study, which Business Today reported, indicates that e-commerce companies like Amazon, Snapdeal, and Flipkart sold goods valued at $3 billion over the course of the six-day festive sale this year. Diwali also kicks off the wedding season in India, marking the beginning of another opportunity to increase sales significantly through seasonal Diwali promotions. v) Technological advancement The advances in technology have made the marketing environment more exciting and rapidly changing environment. Computer software and artificial intelligence is used to design and make new products or redesign and alter existing products. Technological advances have also led to streamlining distribution and promotion of products. With digital marketing relevant content can be delivered to the targeted audience or specific groups. The outreach of the campaign has increased widely and rapidly. Customers can now access media through various social media content through Facebook, YouTube, Instagram. A niche idea can be marketed easily and can get tremendous coverage. MARKETING IN DIFFERENT REGIONS - US/UK/SINGAPORE AND ASIA ANALYSIS Marketing techniques differ in different parts of the world. What may work in one country may not necessarily work in another country. A business that is looking to expand its global outreach needs to understand the cultural nuances, the local audiences, regulations within a country, the different social media platforms used. To grow in diverse markets, every business needs to tailor the marketing strategies that resonate with their target audiences. United States In the United States, digital marketing has a strong presence as the population is tech-savvy and has very high number of internet users. Several digital marketing channels like Facebook, Instagram, Twitter are popular way of making your presence felt in the market. For example, Glossier, a beauty brand was a billion-dollar business within a decade. It used Instagram to reach its customers using a cool and casual tone to appeal its customers and bypassed the traditional offline marketing route. It has made the social media platform as two-way communication tool to get feedback from its customers and inform about product launches. Modifying or customizing the products based on size, design and packaging is crucial to the US market. For example, most of the global food chains serve large portion sizes in the United States as compared to other global markets. At the same time, it is important to be aware of the various regulations imposed by different agencies. Seasonal items are introduced to appeal the festive season and preferences. For example, Shamrock Shake, a green minty drink offered by McDonalds in the month to celebrate the St. Patrick’s Day is popular drink. Brand reputation, quality and pricing go a long way in gaining the market share in the US. At the same time, they are also looking up to the companies that introduce environment friendly products. There is lot of investment made towards positive brand communication U.S. consumers value brand reputation, quality, and authenticity. Building consumer trust is key to long-term success, especially as the U.S. is a market with high expectations for customer service and product quality. For example, Patagonia, a leading outdoor apparel brand is known for its long-lasting products. It has tapped in more consumers by contributing to environmental issues. In 2018, Patagonia donated $10 million received from President Trumps 2017 tax cuts as an initiative and commitment towards protection of the environment. [6] Although Apple products have a premium pricing it has positioned itself in the market as a product with high-quality design and performance. To attract more customers and increase its sales it offers discount programs by trade-in deals. United Kingdom A business entering the UK market needs to customize its marketing strategy keeping in mind the cultural preferences and local tastes. The UK has diverse cultural groups across Scotland, Wales, Northern Ireland and England. This diversity can impact how messages may differ in tone and how the brands approach local marketing. In UK, there is a blend of both digital and traditional marketing channels. Many food and beverage companies modify their flavors and packaging based on the local needs whether it is portion size or environmentally friendly packaging. Like the United States, digital marketing has a strong presence in the UK as well. Most of the people in UK are e-commerce shoppers and look for products and services online or on social media platforms. Since there is a lot of web traffic, one of the approaches used by many marketers is paid search and search engine optimization (SEO) which can be a great marketing investment tool. When it comes to advertisements, British consumers prefer advertising which contain humour, wit and subtlety. The tone of advertising is light-hearted but at the same time should also consider issues inclusivity. The British also favour businesses that provide high-quality goods and are customer-friendly when it comes to product returns and general assistance. The country has strong consumer protection laws, so fair return policies are important in gaining customer loyalty and trust. UK has a price sensitive market, and the retail and e-commerce sales are often driven by discounts and promotional offers. Tesco and Sainsbury’s often resort to competitive pricing strategies to increase their sales. During the Boxing Day or during Christmas, retailers often resort to lucrative discount offers. Asian Countries Most of the countries in Asia lay strong emphasis on family values. China In China, understanding and respecting the cultural differences, Chinese values and behaviour among different regions within the country is essential and plays a vital role. Therefore, Cross-cultural marketing is important to succeed in Chinese market. For maximum reach, marketing should be tailored in such a way so as to capture the cultural sensitivity which includes content and product adaptation. It is equally important to choose the right marketing platform or channel. WeChat and Weibo are popular digital media platforms to effectively reach a larger Chinese audience. At the same time, the marketers must keep in mind the regulations and the restrictions imposed by the Chinese government. Singapore Marketing in Singapore which is a highly developed competitive market requires a blend of using the best global practices while acknowledging the marketing dynamics because of unique preferences and cultural values. Singapore is a multicultural society with people of different ethnicities. Marketing needs to be tailored in a way to appeal various mix of people with a keen understanding of the local culture, consumer behaviour, and market dynamics. In Singapore, digital marketing plays an important role. Social media platforms like Instagram, Youtube, Facebook, Tiktok are used to promote good and services. Along with that influencer marketing has become a highly effective marketing tool. Collaboration with influencer who have a strong following is common to promote different products. Marketing through traditional channel such as TV, radio and newspaper advertisements still hold a lot of appeal. Outdoor advertising on billboards, bus stops and train stations have proved effective. Along with that mobile are also effective ways to engage customers. Customer satisfaction and experience hold utmost important. Singaporeans enjoy their seamless experience irrespective of online or offline medium. India Like its other Asian counterparts, outlining effective marketing strategy requires understanding the cultural diversity in India, the varying tastes and preferences of its population. It also requires understanding the change in the demographic scene and the rapidly expanding urbanization. Most of the people in India are price sensitive. With a steady increase in high-speed internet connectivity, online retail marketing and social media platforms have become one of the prominent ways to market goods and services. Many people are now inclined towards online shopping. Also, celebrity and social media influencer marketing has gained popularity. Often messages and emails are effective for marketing in urban areas. With viewership in millions across television and OTT platforms, another popular medium is television, radio and OTT platforms. Newspaper advertising is still a prominent medium of marketing in India especially in smaller cities and rural areas. With over 100 languages, localized and regional advertising play a vital role in increasing customer engagement. Customer support for products and services in regional languages besides Hindi and English is now a common feature which enhances customer experience and satisfaction. At the same time, customizing and offering discounts during different festivals has proved to be successful marketing campaign. SIMILARITIES AND DIFFERENCES IN MARKETING STRATEGIES IN DIFFERENT PARTS OF THE WORLD While traditional marketing still is prevalent in most parts of the world, the invent of high speed connectivity, more and more reliance is being place on digital marketing. Marketing through social media platforms has shown an increasing trend through social media influencers and celebrities across different countries. In most of the countries, the marketers should be sensitive of the religious, lingusitic and cultural practices followed by the different ethnicities and should ensure that they do not offend any group. Most of the companies adapt and try to build a deep connection with its target customers. However, the main difference is in the type of advertisements. In the United States more emphasis are laid on marketing which lean towards individualism and there is hard selling about when it comes to the products as compared to United Kingdom where soft-selling tactics are applied. Also, in many countries the regulatory environment is stringent, therefore the businesses also have to keep in mind the data privacy guidelines and the advertising and marketing guidelines. Cultural messaging and values differ significantly, with U.S. and UK leaning toward individualism, and Asian countries emphasizing family, tradition, and community. CONCLUSION Marketing in today’s world has become complex as many businesses now have their operations across continents. Mass marketing is now being replaced by focused marketing. To successfully market one’s products and services, businesses often select their target markets and create a niche market. At the same time, to have a presence in different world markets, intercultural dimensions and of marketing and understanding the regulations in any country are becoming more and more important. Marketing skills needs constant upskill as businesses are crossing borders in search of new competition. They now have face global competition. Understanding the local marketing and keeping the sentiments of the different groups and communities in mind, marketing strategies require adaptation to the regional specifics. This in the long run fosters brand loyalty and ensures overall market success. BIBILOGRAPHY https://asialinkbusiness.com.au/china/sales-and-marketing/marketing-in-china?doNothing=1 https://cm-brand.co.uk/news/marketing-strategies-attract-uk-consumers/ https://www.dynamiclanguage.com/unlocking-global-markets-success-stories-and-key-localization-strategy-examples/ https://econsultancy.com/how-glossier-has-used-instagram-to-create-a-cult-following/ https://elia-association.org/2023/05/multilingual-marketing-and-the-power-of-language/ E-marketing - The Essential Guide to Marketing in a digital world by Rob Stokes https://www.theguardian.com/media-network/media-network-blog/2014/sep/29/technology-changing-marketing-digital-media https://www.investopedia.com/terms/m/marketing-strategy.asp https://kadence.com/en-us/market-entry-uk/ https://lokalise.com/blog/localization-examples/ Marketing by Courtland L. Bovee, Michael Houston and John V. Thill – 2nd edition Marketing Management by Philip Kotler and Kevin Lane Keller – 12th edition https://www.newyorker.com/magazine/2023/09/25/how-glossier-made-effortlessness-a-billion-dollar-brand https://onstrategyhq.com/resources/pestle-analysis-examples/ Principles of marketing, 3rd edition by Thomas C Kinnear and Kenneth L. Bernhardt https://summalinguae.com/localization/the-conflict-between-a-strong-brand-and-local-language/ https://seoagencychina.com/cross-cultural-marketing-strategies-in-china/ https://www.tomedes.com/translator-hub/china-marketing-tips Understanding Digital Marketing - Marketing Strategies for Engaging the Digital Generation by Damian Ryan, Calvin Jones https://ux247.com/product-adaptation-in-foreign-markets-with-examples/ https://www.wired.com/story/how-to-build-a-brand-glossier/ [1] https://www.bls.gov/opub/mlr/2002/05/art2full.pdf [2] https://www.thehindubusinessline.com/economy/shrinking-households-50-of-indian-families-are-nuclear/article67126676.ece [3] https://www.euronews.com/travel/2023/06/11/italy-malaysia-usa-which-cities-and-countries-are-cracking-down-on-airbnb-style-rentals [4] https://www.uber.com/newsroom/driving-a-green-recovery/ [5] https://www.business-standard.com/india-news/diwali-sales-set-to-hit-rs-4-25-trillion-traders-prep-for-festive-boom-124102800458_1.html [6] https://www.patagoniaworks.com/press/2018/11/28/patagonias-urgent-10m-gift-to-the-planet Previous Next

< Back Essence of Digital Marketing by Zaynah Buhariwala How many of us bother to watch an entire advertisement between our much-loved YouTube content? The old paper board advertisements are now replaced with electric billboards, which change every 2 minutes. Insta ads and more, the future of marketing. How many times have you clicked on a website, you had never even heard of before, all because you saw that really cute outfit on your for you page?! This is the power of digital marketing. The main advantage is that the smallest of companies are investing in digital marketing and making a huge turnover on that investment. Digital marketing has made life easier for the consumer, by having everything at a click of a button; and for the business owners. Like The Stone Age marked the use of stone tools for hunting, gathering, and all other daily necessities. This simplified his life and he had more time to focus on art, culture, and other important things like agriculture and construction. The same is true for the Bronze Age and Iron Age. Likewise, today's age is called the Information Age or Digital Age because of our dependency on Digital Technology. The world is cruising towards complete digitalization and the current COVID-19 pandemic has accelerated it. Digital Technologies has changed the way we look at the world. It has eased our day–to–day tasks. It has opened the floodgates of knowledge and information to the masses. Digital Technology has brought the world just a 'click away'. A focus on content and information. One of the changes that came with new-age marketing techniques was the shift away from traditional advertising and placing more focus on content and information provided to your customers. This paper gives one an insight into the inner workings and technicalities of new-age marketing techniques. NEW – AGE MARKETING TECHNIQUES Social Media Marketing Social media marketing (also known as digital marketing or e-marketing) is the use of social media platforms; like apps like Instagram, tik tok, etc. It encompasses various tactics, including, email campaigns, content creation, search engine optimization (SEO), and influencer marketing. Data–driven approaches and new-age tools are crucial in crafting and implementing effective digital marketing strategies. Social media has become the method of statement in the 21st century, enabling us to express our beliefs, ideas, and manner in a new way. This way of message also has a huge impact on corporations, where they have realized that without a correct plan and social media strategy, they have no chance to stand out in the rapidly changing digital freedom. To guarantee successful attendance on social media companies need to consider different marketing theories so that they can boost their brand in different aspects. If this can be collected with original ways of consumer interaction the companies have a good chance to take the lead in social media marketing. The meteoric growth of community websites, such as Twitter, Facebook, and Linked, has ushered the world into a new era of social media. The global reach is nothing short of marvelous, so much so that if Facebook were a country, it would be the third largest, next to China and India. Some even say that this is the biggest shift since the industrial revolution, which means that the world has a brand-new playing meadow. At its center, social media is any kind of online media that stimulates participation, open conversation, Connecters, and a sense of community. The social media phenomenon has a profound impact. Social media has transformed research methods. This allows brands to communicate better with their consumers, and intensify their association with them. The advertising world has not been spared from social media influence. TYPES OF SOCIAL MEDIA MARKETING STRATEGIES Email Campaigns A series of marketing efforts, including email campaigns. It is a schedule, which is used to nurture leads and current customers to encourage engagement with the brand and increase sales. The goal of an email campaign is to entice the recipients to purchase a product or service or to learn more about the business. Each individual leads to a specific call-to-action; that is, getting users to sign up, book a call, sign up, or add a product to their cart. In an email campaign, the delivery time is relative – it refers to the time the contact is a part of the campaign. An accurate example would be Netflix: Marketing Campaign: Engagement More than half of US households subscribe to multiple streaming channels . With several platforms vying for our attention, brands like Netflix have gotten more targeted with their emails. This email from Netflix provides a curated list of new shows the customer may be interested in based on their watch history. It's skimmable with plenty of visuals supporting the new releases and provides a CTA that prompts you to watch the trailer. It also uses Netflix’s familiar black-and-red design, so that the recipient feels like they’re scrolling through Netflix, demonstrating the importance of keeping branding consistent across all your messaging channels. Why It Works?! The CTAs in this email entice the user to stop what they're doing and head over to Netflix to check out the new content. It also includes a “Top Picks for You” section that shows personalized recommendations for the user. Content Creation Just like we have the 4Ps of marketing, we have the 3C'S of content creation. Content, channel, and context: Content is the information that is being gathered and provided. It is the facts, and features or benefits of the message – the “what”. For example, it’s the details of your product or service that will help the target solve their problem. Channel is “where” and “when” the message is most likely to reach and be accepted by the target. Here we have to consider the buyer’s mindset. For example, if they are on their way to work, then the business is most likely on their mind; on the way home, personal activities may become front and center. Context is “how” the message is packaged in the communication channel; it is everything except the “what” and the “where”. The context is the creative application of the message – the visual packaging, the emotion, the psychology, the tone, and the manner. For example, for sure you have heard of MR. BEAST, the famous Youtube legend. Mr. is one of the most popular Youtube content creators, with 154 million subscribers on the platform. His videos involve him doing stunts, some of which are elaborate, and many go viral. He sells a wide array of merchandise, including apparel and accessories and even chocolates and gummies. He's parlayed his success into philanthropy after giving away the first $10,000 he made from a YouTube sponsorship deal in 2017. In the picture below, Mr. Beast is promoting his cookies as well as Walmart, creating a buzz for them! He is creating the content, by posting about it, context by stating it's going to be available at Walmart and context is the fact that he is promoting it. Search Engine Optimization (SEO) Search Engine Optimization (SEO) is the process of improving the quality and quantity of website traffic to a website or a web page from search engines. SEO targets unpaid traffic (known as “natural” or “organic” results) rather than direct traffic or paid traffic. In simple terms, SEO means the process of improving your website to increase its visibility in Google, Microsoft Bing, and other search engines whenever people search for: Products you sell. Services you provide. Information on topics in which you have deep expertise and/or experience. The better visibility your pages have in search results, the more likely you are to be found and clicked on. Ultimately, the goal of search engine optimization is to help attract website visitors who will become customers, clients, or an audience that keeps coming back. Whenever people want to go somewhere, do something, find information, research, or buy a product/service – their journey typically begins with a search. But today, the search is incredibly fragmented . Users may search on traditional web search engines (e.g., Google, Microsoft Bing), social platforms (e.g., YouTube, TikTok), or retailer websites (e.g., Amazon). THREE TYPES OF SEARCH ENGINE OPTIMIZATION (SEO): Technical SEO: Optimizing the technical aspects of a website. On-site SEO: Optimizing the content on a website for users and search engines. Off-site SEO: Creating brand assets (e.g., people, marks, values, vision, slogans, catchphrases, colors) and doing things that will ultimately enhance brand awareness and recognition (i.e., demonstrating and growing its expertise, authority, and trustworthiness) and demand generation. Influencer Marketing Influencers are a new way of making money for a company. By paying a generous amount, they get their brand or product showcased to half a million people with a click of a button. However, this type of marketing is beneficial for everyone, most of the consumers do not have to pay for subscriptions to the brands, the influencers get recognition and an added fan base from the brand, and vice-versa. The brand also gets recognition and publicity which results in an increase in turnover and consequently an increase in profits! Social media platforms like Instagram, and TikTok; provide a great audience for influencer marketing! Many brands use influencer marketing to reach their target audience. Big brands like Motorola, Adidas, Pepsi, and Dunkin' Donuts all use influencer marketing. Adidas has been using influencer marketing to promote its products for years now. They use influencer marketing to target a younger audience through Instagram, etc. For example, 67 Shades of Dior Campaign - The Gold Winner for the Best Beauty Campaign at the 2020 Influencer Marketing Awards was Dior, who teamed with the influencer marketing agency, Buttermilk. The campaign was to celebrate the launch of Dior's Forever Foundation, which is a range with 67 unique foundation shades. The fastest and new age of marketing involves influencer marketing, which has created a different and most influential sector of marketing. Email Marketing With more recognition of big data, and with the ease that it has not only provided to companies but also to consumers. It's so easy for a company to connect with an interested consumer if they just fill out their details and subscribe to the company, then they could get updates about the company and the company would benefit by creating loyal customer and brand awareness. Ever once signed up for a spam mail by mistake? Then got irritated by the number of emails they kept sending every hour! Well, that is the point of email marketing. Even bad broadcasting is good for the company. It at least lets the company build up brand awareness. Email marketing is the act of sending a commercial message, or nowadays a “spam” message, via email to a group of people. In its broadest sense, every email sent to a potential or current customer could be considered email marketing. It involves using email to send advertisements, request business, or solicit sales or donations. Email marketing strategies commonly seek to achieve one or more of three primary objectives, to build loyalty, trust, or brand awareness. The whole purpose of sending emails out and performing email marketing is to create a good customer-merchant relationship. Especially, for small businesses, in the early stages, this gives them a chance to create a loyal customer base and then expand their business from there! There are 4 types of email marketing; mainly email newsletters, transactional mail, promotional mail, and retention emails. Marketers have been using email as a channel for almost as long as they've been using the internet. The first marketing email was sent in 1978, resulting in $13 million in sales. Email has been one of the most highly used marketing channels ever since. This is because email is a flexible yet cost-effective way to reach many people relatively quickly. You can also personalize your message to target specific audiences and generate leads. EMAIL NEWSLETTERS: Email newsletters are adding value to your subscriber's inboxes. To do so, create engaging content, including thought leadership, how-to’s, and upcoming new products/sales. Your email newsletter should be a short-sweet message to the consumers, maybe based on the latest trends! Short concise newsletters, that can be read in 5 minutes or less. Nobody wants to be stuck reading a 10-minute newsletter therefore, engaging your customer base and finding out what content and how much they are engaging, can help you build up on your newsletter. Your email newsletter is only as successful as your content is compelling. TRANSACTIONAL EMAILS: Probably one of the most boring and least liked by consumers. Getting the big fat bill! That is exactly what transactional email marketing is. Probably one of the least glamorous but most effective forms of email marketing; transactional emails are sent to facilitate an expected transaction between a sender and a recipient. The context of the transaction varies; it could be a welcome email, a confirmation email, or even a cart abandonment email A transactional email is meant to inform the customer about the action they have just taken. For example, every time I use my credit card, I get an email on my registered mobile number, saying that a transaction of $x amount has been transacted from my account. And nobody wants money out of their bank accoun PROMOTIONAL EMAILS: T he main goal is to convince or entice customers to make a purchase. To get the formula right you need to use promotional emails to reward engaged subscribers with exclusive offers, drive new products or services to subscribers, and cross-sell products to your customer base. The purpose of these emails is to build your customer base and customer loyalty. It converts subscribers to customers and customers to brand advocates. For example, while scrolling through your for you page on Instagram, you come across a really cute top and then immediately purchase it. You are now a subscriber to the brand and sign up with it. Next, you get a promotional email and purchase more, you are now a loyal customer or even a brand – advocate. That is the magic of promotional emails. It's got you hooked! RETENTION EMAIL: A retention email is a targeted and triggered message sent to an existing customer to increase engagement, loyalty, and satisfaction . By sending a message requesting feedback or an offer to subscribers who haven't interacted with your business or email campaigns lately, your small business can keep the lines of communication open. Retention Emails are a very useful email campaign strategy that can help you keep your hard-won customers. For example, the end questionnaire you fill out, at the end of a purchase, is a retention email, and once the brand has got your feedback and sent you the improvements; you will come back for more. Creating convenience for you! Role of Big Data in Marketing “Without big data analytics, companies are blind and deaf, wandering out onto the Web like deer on a freeway.” Whether you are trying to improve customer loyalty and engagement, optimize your performance, or make pricing decisions, big data in marketing has proven to be an indispensable tool. Big data refers to the ever-increasing volume, velocity, variety, variability, and complexity of information. For marketing organizations, big data is the fundamental consequence of the new marketing landscape, born from the digital world we now live in. That being said, big data is transforming and modeling into new-age marketing techniques. But what is big data? In terms of marketing, big data comprises gathering, analyzing, and using massive amounts of digital information to improve business operation. Big data is universally accepted in almost every vertical, not least of all in marketing and sales. While Moore’s tweet referred specifically to big data analytics, the same is true for all aspects of big data, including data ingestion, integration, storage, and more. Many marketers may feel like data has always been big – and in some ways, it has. But think about the customer data businesses collected 20 years ago – point-of-sale transaction data, responses to direct mail campaigns, coupon redemption, etc. Then think about the customer data collected today – online purchase data, click-through rates, browsing behavior, social media interactions, mobile device usage, geolocation data, etc. Comparatively speaking, there’s no comparison. And to borrow an old phrase, "You ain’t seen nothin' yet." How Big Data is Transforming Marketing GETTING A 360-DEGREE VIEW OF THE COMPANIES AUDIENCES – The concept of "know your customer" (KYC) was initially conceived many years ago to prevent bank fraud. KYC provides insight into customer behavior that was once limited to large financial institutions. Now, because of the accessibility of big data, the benefits of KYC are available to even small businesses, thanks to big data and cloud computing. Big data analytics provides the business intelligence you need to bring about positive change, like improving existing products or increasing revenue per customer. With email marketing, gaining popularity, big data plays a huge role in getting information from consumers, and without big data, email marketing probably wouldn't exist today. BRAND AWARENESS – The 360-degree view from big data allows marketers to present customer-specific content when and where it is most effective to improve online and in-store brand recognition and recall. Big data allows you to be the band-aid of your product category even if you don't have the marketing budget! For example, email campaigns, as mentioned previously, bring great brand awareness and thanks to big data; are very specific to the consumer's likes and dislikes. Social media and email marketing help brands build awareness and big data is the backbone for these marketing techniques to work! Big data can help marketers, with real-time data in cloud computing environments. The ability of big data to acquire, process, and analyze real-time data quickly and accurately enough to take immediate and effective action cannot be matched by any other technology. This is critical when analyzing data from GPS, and clicks on websites- like we spoke about how in search engine optimization, the searches are very specific to the consumer, that is with the help of big data, the brand can access that information and make changes to the searches according to the consumer. Big data provides business intelligence that results in time and cost savings by optimizing marketing performance. Here's a case study: Big data Gives Beachbody near Real-time user behavior to reduce customer churn Beachbody provides world-class fitness, nutrition, motivation, and support to 23 million customers. Their business is all about the customer experience; keeping people motivated and matching them with the content that keeps them coming back for more. You may be familiar with Beachbody's on-demand videos, but they also offer live sessions at gyms. Big data has enabled the company to acquire near real-time consumer behavior in fitness centers. Combined with analysis from online data sources, Beachbody's big data allows the brand to create more personalized offers for customers and decreased customer churn. We can also connect this to the previous marketing techniques we spoke about, like CONTENT CREATION AND SEO – They created viral videos which users engaged with and that created brand recognition. The SEOs were specified by the company for their subscribed users, which made it easier for the users to also connect with the company's particular event. Types of Big Data CONSUMER DATA – helps marketers understand their target audience. The obvious data of this type are facts like names, emails (which is a part of the marketing plan for email campaigns; as discussed previously), purchase history, and web searches (SEOs). Just as important, if not more so, are indications of your audience’s attitudes that may be gathered from social media activity, surveys, and online communities. FINANCIAL DATA - helps you measure performance and operate more efficiently. Your organization’s sales and marketing statistics, costs, and margins fall into this category. OPERATIONAL DATA - relates to business processes. It may relate to shipping and logistics, customer relationship management systems, or feedback from hardware sensors and other sources. Analysis of this data can lead to improved performance and reduced costs. BIBLIOGRAPHY: 1. Indiraiimp.edu.in 2. Hubspot.com 3. Mailchimp.com 4. Campaignmonitor.com 5. Linkedin.com 6. Searchengineland.com 7. Talend.com 8. Social media marketing article by Sarvakumar Previous Next

< Back EVs - The next big thing in saving the environment by Vidur Jhunjhunwala This study investigated the background characteristics and environmental impacts of EVs with an emphasis on their potential in the Indian market. EV- The next big thing in saving the environmentELECTRIC VEHICLE The Primary components of a Battery Electric Vehicle (BEV) are • The Battery Pack • Inverter • Electric Motor • Controller • Charger • Charging Cable Battery Pack A BEVs range, propulsion and all its other features depend solely on the battery pack for power. BEVs use high voltage batteries (HV) to power them. The battery pack is built by connecting thousands of these cells in series and parallel to achieve the required amount of current output from these cells. An energy source like a battery needs to satisfy two important criteria-energy density and power density. These along with other features like easy maintenance, long life, inexpensive and fast charging. There are various batteries which have been used for BEVS. Few include lead-acid, Ni- Cd, Li-ion. The most common battery used in BEVs are Li- ion batteries. However, the industry is slowly drifting towards Na – ion batteries which are more efficient than Li-ion. 5 The figure depicts the multiple battery cells used in EV battery packs. In the Tesla Model S, cells are arranged into different modules. 16 of these modules are then connected in series and parallel to achieve the desired power output. Metallic inner tubes are passed through the gaps between the cells in which glycol coolant is passed through to prevent overheating of the batteries. The benefit of using multiple smaller cells instead of fewer big cells is the temperature is maintained evenly preventing thermal hotspots in the case of the small cells. Even temperature distribution results in higher battery life. The low height of the battery pack fitted close to the ground level, lowers the vehicles center of gravity which provides extra stability to the vehicle. The battery pack is also spread across the floor allowing for structural stability and protection from side collisions. As said earlier Lithium - ion cells are the most used cells for BEVs currently, they work on the principal of converting chemical energy to electrical energy via redox reactions. Understanding the functioning of Lithium-ion Cells (LICs) requires knowledge of lithium's properties that allow it to function as a cell. Lithium atoms are very reactive and easily give away their lone electron from the outermost shell. In contrast, lithium oxides are extremely stable compounds. Once the lithium atom is removed from its oxide, it becomes very unstable and easily gives away its outer electron. When there is a designated route for both the electron and the lithium-ion to reach the metal oxide separately, the lithium- ion will combine with the oxide while the electron moving towards the oxide will produce electric power. This is the fundamental concept that LICs function based on. An LIC is composed of a cathode, an anode, a separator, and two current collectors, usually constructed from copper and aluminum. 7 The graphite anode is typically referred to as the anode or negative terminal. The ring structure of graphite enables lithium ions to intercalate between its layers. The lithium metal oxide used as the cathode, also known as the positive terminal, is typically lithium cobalt oxide or lithium manganese oxide. Organic solvents usually contain lithium hexafluorophosphate as the electrolyte. This electrolyte is applied onto a partially permeable separator, allowing lithium ions to move between electrodes while blocking electron flow. Copper and aluminum current collectors have cathode and anode coatings applied to them. While charging, current goes to the cathode, leading to the separation of lithium ions from the oxide and their movement towards the anode via the electrolyte and separator. At the same time, electrons move through the external circuit to reach the anode and insert themselves into the graphite. While the battery is discharging, electricity is produced as electrons move from the anode to the cathode, powering the device, and lithium ions travel towards the cathode and embed themselves into the oxide material. This process is how an LIC generates power. Motor and Engine BEVs utilize motors instead of traditional Internal Combustion Engines to propel the vehicles. Electric vehicles are typically powered by either permanent magnet synchronous motors (PMSM) or induction motors (IM). PMSM It operates based on a magnetic field that moves and another magnetic field that remains constant. An electric motor is made up of two main components. The stationary part and the rotating part The stator is supplied with three phase alternating current, resulting in a rotating magnetic field within the stator. Synchronous speed (Ns) is the speeds at which the magnetic field revolves. The rotor consists of aluminum bars, permanent magnets, and silicon steel laminations. Placing the rotor inside the stator results in the generation of a current induced by the rotating magnetic field, leading to a torque that causes the rotor to rotate in sync with the magnetic field. The permanent magnet's opposite poles and the rotating magnetic field are attracted to each other, becoming magnetically locked and causing the rotor to turn until it reaches synchronous speed. The rotor's mechanical energy is transferred to the wheels, resulting in their rotation. Ns=120f/P f- frequency of electricity P- number of poles Inverter The inverter converts the DC supply from the battery to AC for the motor. The frequency of the current supplied can be altered by the inverter hence changing the speed of the car. The inverter also plays a role in the regenerative braking system. When there is no signal from the accelerator, the kinetic energy of the car is converted to electrical energy which is converted to DC voltage and adjusted to fit the batteries requirements charging the batteries. The inverter constantly alters the frequency of the AC current supplied to the stator as the rotor is slowing down, hence braking. Charging Electric vehicles (EVs) have the capability to connect to charging systems powered by either alternating current (AC) or direct current (DC). These systems are available in various configurations, commonly known as "levels." The amount of time required for your EV to be fully charged depends on the level you select. Chargers must also adhere to safety standards. Charging using alternating current. AC AC charging stations utilize a converter integrated within them to convert AC power received from the grid into DC power for charging the battery. The SAE has set various power levels for AC EV charging. •Level 1 offers the lowest speed, delivering either 12 amps or 16 amps based on the circuit, with a top voltage of 120 volts.Level 1 charging is appropriate for charging overnight, especially for smaller EVs, and can require up to 12.5 hours to fully charge. • Level 2 charging is the most frequently used method for electric vehicles. A special charging station called Electric Vehicle Supply Equipment (EVSE) is needed for a direct connection to the electrical grid. The electric vehicle has its own built-in charger which changes alternating current into direct current. Level 2 chargers provide 240 volts and up to 60 amps, resulting in a maximum power output of 14.4 kW. This enables charging at a significantly faster rate than Level 1. • Level 3 is the high-powered choice made for use at public charging stations. These are fixed in place and connected to supply over 14.4 kW of power. For instance, quick chargers can greatly decrease charging durations, frequently refilling an electric vehicle battery in approximately 30 minutes. DC In contrast to AC charging, DC systems provide a faster charging option for electric vehicles (EVs). These systems need special electrical wiring for higher power output and can be set up in either home garages or public charging stations. DC charging systems are classified based on the power they provide, ranging across various levels. • Level 1 (Up to 36 kW): Although the slowest DC option available, it could still be useful for occasional charging needs. • Level 2 (Up to 90 kW): This level is frequently used and provides a nice equilibrium between charging rate and power needs. • Level 3 (Up to 240 kW): These chargers are the strongest DC fast chargers available, cutting down on charging times but necessitating unique infrastructure. EV owners can optimize their charging experience by selecting the appropriate DC charging level that suits their needs and infrastructure access. ADVANTAGES OF EVs 1)EVs offer a clear environmental benefit. They produce zero tailpipe emissions eliminating harmful pollutants like CO2, SO2, NOX etc. This is particularly impactful in urban areas where traffic congestion can arouse further air quality issues. Though the electricity provided to the EVs is majorly from fossil fuels and other indirect emissions, in the long run the environmental harms are much lesser than ICEs. As the electricity transitions towards renewable sources the environmental benefits of EVs increase further. “A major concern about electric vehicles is that the supply chain, including the mining and processing of raw materials and the manufacturing of batteries, is far from clean,” says Gillingham. “So, if we priced the carbon embodied in these processes, the expectation is electric vehicles would be exorbitantly expensive. It turns out that’s not the case; if you level the playing field by also pricing the carbon in the fossil fuel vehicle supply chain, electric vehicle sales would actually increase.” 2)Though EVs cost more upfront, the long-term cost of EVs is lesser than their ICE counterparts due to easy maintenance especially if charged at home. EVs do not require oil changes, spark plug replacements and electricity costs per unit are generally lower than gasoline. If charged overnight when demand of electricity is low this cost becomes even lower. For these reasons many shipping companies are transitioning their shipment trucks to electric vehicles due to cheaper long-term price 3) EVs provide an instant torque and remains constant for a longer period, while providing almost similar power as ICE as the energy generated by the motor is given directly to the wheels hence allowing for peak output immediately. Risks of EVs Limited Range and Charging Infrastructure: One of the major concerns for potential EV buyers is range anxiety, the fear that an electric vehicle will run out of battery before reaching its destination. Although modern EVs have improved their range capabilities, they still fall short when compared to the distance that ICE vehicles can travel on a single tank of fuel. Moreover, the availability of charging infrastructure remains a significant challenge. In many regions, there are not enough charging stations, and those that exist may not be conveniently located or may offer slow charging speeds. This infrastructure gap makes long-distance travel and even daily use less convenient for EV owners, potentially limiting the widespread adoption of electric vehicles. Battery Degradation and Disposal Over time: the batteries in electric vehicles degrade, losing their capacity and efficiency. This degradation can result in reduced driving range and overall vehicle performance, necessitating costly battery replacements. The lifecycle of an EV battery is typically around 8-10 years, after which it may need to be replaced, adding to the total cost of ownership. Additionally, the disposal and recycling of used EV batteries present significant environmental challenges. Batteries contain hazardous materials that require careful handling and processing to avoid environmental contamination. While recycling technologies are improving, the infrastructure for large-scale battery recycling is still developing, posing potential environmental and logistical issues. Impact on Stakeholders who Lose Out Oil and Gas Industry: The shift towards electric vehicles directly impacts the demand for oil and gasoline, which are the primary fuels for internal combustion engine vehicles. As more consumers adopt EVs, the demand for fossil fuels decreases, leading to lower revenues for oil producers, refiners, and distributors. This reduction in demand can also affect global oil prices, creating market volatility and financial instability within the oil sector. Companies in this industry may face significant financial losses and may need to diversify their business models to remain viable in a future dominated by electric transportation. Traditional Automotive Industry Manufacturers that have historically focused on producing ICE vehicles may struggle to adapt quickly to the electric vehicle market. This transition requires substantial investment in new technologies, manufacturing processes, and workforce training. Companies that fail to adapt may lose market share and revenue. Additionally, suppliers of components specific to ICE vehicles, such as engines, transmissions, and exhaust systems, may see a decline in demand for their products. This shift can lead to job losses and economic disruptions in regions heavily dependent on ICE vehicle production and related industries. EVs in India Electric vehicles (EVs) in India represent one of the most rapidly growing and promising industries. As of 2023, EVs accounted for 6.5% of all vehicles in the country. According to the Indian Ministry of Road Transport and Highways, there were 1,334,385 electric vehicles on Indian roads by July 2022. India's ambitious goal is to have 30% of all vehicles be electric by 2030, a target that underscores its bold approach to reducing oil dependency. This shift could significantly impact global oil prices and market trends, given India's status as the world's third-largest oil importer. The country's strategy for electric vehicles carries significant global ramifications, given its rapidly expanding economy and population. A successful transition in India could serve as a model for other developing nations, potentially accelerating the decline in global oil consumption. As India advances towards cleaner energy and better battery and charging technology, the market for EVs is expected to rise exponentially. Currently, leading EV manufacturers in India include Tata Motors, with models like the Nexon EV, Tigor EV, and Tiago EV; Mahindra Electric, with the eVerito and the e2oPlus; and MG Motor India, with the MG ZS EV. The Indian EV market is at an inflection point, with EVs accounting for about 5% of total vehicle sales between October 2022 and September 2023. This penetration could exceed 40% by 2030, driven by strong adoption rates exceeding 45% in both the two-wheeler (2W) and three-wheeler (3W) categories. Despite this potential, several structural challenges need to be addressed to spur increased EV adoption. These challenges include the higher price of EVs compared to internal combustion engine (ICE) vehicles, range anxiety, limitations in charging infrastructure, and friction in customer financing. Companies like Hyundai plan to invest close to $4 billion in the Indian market over the next decade, focusing on launching new EVs, establishing charging stations, and setting up a battery pack assembly unit. Maruti Suzuki India, the country's top automaker by sales, also plans to have six EV models by 2030. Currently, 2W EVs form most EV sales, accounting for 85%–90% of all EV units sold in India, followed by 4W EVs (7%–9% of sales) and 3W EVs (5%–7% of sales). The Faster Adoption and Manufacturing of Electric Vehicles (FAME) scheme's Phase II revision saw 2W EV penetration remain stable at around 5%, consistent with January-March 2023 levels. In contrast, 3W EV and 4W EV penetration levels experienced significant growth, with volumes more than doubling over the past 12 months due to their low total cost of ownership (TCO). India is home to numerous electric vehicle makers, offering a range of products from electric cars to scooters, catering to various needs and financial situations. The Indian government's ongoing support for electric vehicles suggests that the number of EVs on Indian streets will continue to rise soon. With significant investments from major automakers and continued innovation in EV technology, India is poised to become a global leader in electric vehicle adoption, setting a precedent for other nations to follow. Conclusion In conclusion. The economic and environmental issues brought about by our reliance on traditional internal combustion engine (ICE) vehicles are compellingly addressed by the rise of electric vehicles (EVs). This study investigated the background characteristics and environmental impacts of EVs with an emphasis on their potential in the Indian market. The primary battery electric vehicle (BEV) components—the battery pack inverter electric motor controller charger and charging cable—were examined in the study. Focusing on this aspect of EV power sources established an understanding of lithium-ion battery technology and operation. Furthermore, knowledge of permanent magnet synchronous motors (PMSMs) and induction motors (IMs) illuminates the workings of the electric vehicle powertrain. An important objective was to investigate the environmental advantages of electric cars. Even though electric cars don’t emit any pollutants into the atmosphere when they drive the article acknowledged that burning fossil fuels to produce electricity typically results in the release of additional emissions. But the long-term environmental advantages of electric cars were emphasized especially as the grid shifts to more sustainable energy sources. The article also discussed how electric vehicles may help to lessen noise pollution in urban areas. The study finds that although the initial costs of electric vehicles may be higher than those of cars with internal combustion engines over time the overall operating costs of EVs are lower. This can be explained by the fact that electricity is less expensive per unit than fuel and requires less maintenance. Furthermore, the topic of how large corporations like shipping companies could save money by converting to an electric fleet was covered. The advantages of this move were considered including the potential to set an example for other developing nations and a significant reduction in India’s reliance on oil. In summary electric cars present a viable future route for a more environmentally conscious transportation sector. Despite obstacles, government support, infrastructure for charging and advancements in battery technology are enabling a greater uptake of electric vehicles. India has a significant opportunity to reduce its dependency on fossil fuels and serve as a model for other developing nations wishing to transition to more environmentally friendly and sustainable modes of transportation thanks to its ambitious electric vehicle (EV) targets. References 1) https://solarsolution.co/ 2) https://www.energy.gov/energysaver/articles/how-lithium-ion-batteries- work#:~:text=The%20anode%20and%20cathode%20store,at%20the%20positive%20current%20collector. 3) https://www.youtube.com/watch?v=3SAxXUIre28&t=316s 4) https://batteryuniversity.com/article/bu-204-how-do-lithium-batteries-work 5) https://www.seai.ie/technologies/electric-vehicles/what-is-an-electric-vehicle/how-electric-vehicles-work/ 6) https://www.i4talk.com/threads/ice-vs-electric-power-and-torque-comparison.8801/ 7) https://www.global.toshiba/ww/products-solutions/battery/scib/product/module/sip/download/batteryschool/episode1.html 8) https://x-engineer.org/battery-electric-vehicle-bev/ 9) https://www.sciencedirect.com/topics/engineering/battery-electric-vehicle 10) https://www.quora.com/Can-an-electric-motor-act-as-both-a-generator-and-an-alternator-If-so-what-are-some- conditions-under-which-this-would-happen 11) https://www.chem.tamu.edu/rgroup/marcetta/chem362/HW/2017%20Student%20Posters/Lithium%20Ion%20Batteries.pdf 12) https://www.chegg.com/homework-help/questions-and-answers/lithium-ion-batteries-use-two-half-reactions-whose- standard-reduction-potentials-shown--co-q11586133 13) https://auto.economictimes.indiatimes.com/news/auto-components/what-are-the-types-of-electric-motors-which- motor-suits-your-ev-the- best/102099884#:~:text=PMSM%20is%20the%20most%20popular,applied%20in%20high%2Dspeed%20applications. https://www.kia.com/uk/about/news/what-are-the-benefits-of-torque-in-electric- cars/#:~:text=Another%20key%20advantage%20of%20the,Internal%20Combustion%20Engine%20(ICE) 14) https://www.kia.com/uk/about/news/what-are-the-benefits-of-torque-in-electric- cars/#:~:text=Another%20key%20advantage%20of%20the,Internal%20Combustion%20Engine%20(ICE).15) https://afdc.energy.gov/fuels/electricity-stations 16) https://avt.inl.gov/sites/default/files/pdf/fsev/compare.pdf 17) https://www.youtube.com/watch?v=fUDq0yS0-Mk 18) https://environment.yale.edu/news/article/yse-study-finds-electric-vehicles-provide-lower-carbon-emissions-through-additional 19) https://cleantechnica.com/2022/02/26/gas-cars-produce-more-supply-chain-emissions-than-evs-yale-university- study/#:~:text=%E2%80%9CA%20major%20concern%20about%20electric,vehicles%20would%20be%20exorbitantly%20expensive. 20)https://www.bain.com/insights/india-electric-vehicle-report- 2023/#:~:text=India's%20electric%20vehicle%20(EV)%20market,%2Dwheeler%20(3W)%20categories. 21)https://www.india-briefing.com/news/indias-prospects-as-an-ev-hub-consumer-market-and-production-capacity-30157.html/ 22)https://jmkresearch.com/category/electricvehicle/#:~:text=Electric%20Vehicles-,6.5%25%20of%20total%20vehicles%20sold%20i n%20India%20in%202023%20were,during%20the%20last%20calendar%20year. 23) https://www.youtube.com/watch?v=stq2E3sZYg0 24) https://www.irjmets.com/uploadedfiles/paper/issue_5_may_2022/24839/final/fin_irjmets1653897083.pdf 25) https://www.iea.org/policies/6201-national-electric-mobility-mission-plan-nemmp 26) https://diyguru.org/faq/top-10-ev-manufacturers-in-india/ 27) https://www.energy.gov/articles/history-electric-car 28) https://www.youtube.com/watch?v=-EG6rqA2vvA 29) https://www.youtube.com/watch?v=S6f1TbWRG3s 30) https://www.researchgate.net/figure/1-The-Structure-of-a-Permanent-Magnet-Synchronous-Motor_fig1_348740662/download? tp=eyJjb250ZXh0Ijp7ImZpcnN0UGFnZSI6Il9kaXJlY3QiLCJwYWdlIjoiX2RpcmVjdCJ9fQ 31)https://www.researchgate.net/publication/364737960 Electric_vehicles_a_review_of_their_components_and_technologies 32) https://www.researchgate.net/publication/350093457_A_Review_on_Electric_Vehicles_Technologies_and_Challenges Previous Next

< Back Economics' Perspectives on Modern Finance by Dweej Desai In synthesizing these diverse elements, this research contributes not only to a nuanced understanding of economic systems and policies but also highlights the imperative of prudent financial management and responsible corporate governance in navigating the complexities of the contemporary economic landscape. Macroeconomics John Maynard Keynes is often referred to as the father of macroeconomics. Keynesian economics is a macroeconomic theory of total spending in the economy and its effects on output and employment. Keynesian economy was developed by the British economist John Maynard Keynes during the 1930s in order to understand the great depression. Keynesian economics is called the demand side economics. Keynes advocated the role of the government through investment expenditure and lower taxes to stimulate the aggregate demand and to pull the global economy out of the depression. Keynesian thoughts emphasized that an optimal economic performance could be achieved by government interventional policies. Fiscal and monetary policies were the primary tools recommended by Keynes to manage the economy and fight unemployment. Concept of consumption function – consumption function in economics is the relation between consumption spending and the various factors determining it. These include income, wealth, riskiness of the future, interest rates etc. it is an economic formula that represents the functional relationship between total consumption and gross national income. It describes the relation between consumption and disposable income. Yd = disposable income after taxes and compulsory contributions. Propensity to consume: - propensity is a term that closely means tendency. Consumption is a function of income, and it is noted that as income levels rise, the propensity to consume diminishes in relative terms. In absolute terms money spent increases. Average Propensity to save: - the ratio of total savings to total income is known as average propensity to save (APS). Thus APS = C/Y where C is consumption and Y is income. Marginal propensity to save - The ratio of increase in savings due to increase in income is known as marginal propensity to save. Thus MPS = DeltaS / DeltaY. Where S is savings and Y is income. Average propensity to consume: - the ratio of total consumption to total income is known as average propensity to consume (APC). Thus APC =C/Y (C = consumption & Y = income). Marginal propensity to consume (MPC): - this is a ratio of increase in consumption due to an increase in income DeltaC/DeltaY Note: - low income groups have a high propensity to consume and high-income groups have a low propensity to consume. A major concept in macroeconomics is the multiplier. The basic tenet of the concept of multiplier is - One person’s expenditure is another person’s income. Thus, during the depression if the government makes an autonomous investment, the propelling force of the multiplier is MPC. The higher the MPC the higher the value of the multiplier. Let us assume the government makes an investment of 100 million and the MPC is 0.8, this 100 million becomes the income of the economy. The earners of this money will now spend 80 million which will become the income of another set of people and this chain continues. The symbol for multiplier is K Thus, the multiplier K = 1/(1-MPC) or 1/MPS Let us assume the MPC is 0.6. then the multiplier will = 1/1 – 0.6 = 1/0.4 = 2.5 Tax multiplier: - when the government injects money into the economy it multiplies by a factor of the spending multiplier, but the government can also have an impact on aggregate expenditures because of taxes or transfers TM = MPC x Multiplier = MPC/MPS Another extremely important part of macroeconomics is Aggregate Demand and Aggregate supply. Aggregate demand – this is also called domestic final demand and is the total demand for final goods and services in an economy at a given time. It specifies the amount of goods and services that will be purchased at all price levels. Aggregate demand consists of consumer goods and services, capital goods, government spending, and exports and imports. AD = C + I + G + (X-M) AD = aggregate demand C = Consumption demand I = Investment demand G = Government Spending X = Total Exports M = Total Imports Aggregate demand curve The aggregate demand curve shows the quantity demanded at each price level. The y axis has price level of all final goods and services. The aggregate price level is measured in terms of CPI, or GDP deflator. On the x axis is the real GDP which is a sum total of all final goods produced in a given year. The aggregate demand curve has a negative slope. Shape of AD – downward sloping – reasons: - Foreign sector substitution effect: - if an economies price level rises foreign goods become relatively cheaper similarly foreigners too will buy less goods of this country. The overall result will be a lesser aggregate demand at higher price levels. Conversely at lower price levels more will be demanded by the consumers of home country and foreigners. - Wealth effect – When the price level is high, the purchasing power of the consumer falls hence less is demanded at higher price levels. Conversely at lower price levels more is demanded due to greater purchasing power. Changes in AD Factors affecting change in aggregate demand: 1) Consumer spending (C): If consumer incomes rise, so will their consumption and savings more over consumption may also increase if their future is secure 2) Investment spending (I): If the expected rate of return is high, firms will invest more since they are optimistic about future profitability, also they may invest more if the rate of interest falls. 3) Government Spending (G): Governments may inject money into the economy through autonomous investments or by reducing taxes or by increasing transfer payments (pensions etc.) 4) Net exports (X-M): o When we sell more goods and services to foreigners and buy fewer goods from them the AD increases. o Foreign incomes – when foreign economies are strong, they buy foreign goods. Therefore, X is greater. o Consumer tastes and preferences – when foreigners tastes and preferences are in favor of domestic goods X increases, therefore AD increases. o Exchange Rate – If the exchange rate of the home currency falls (rupee becomes weak) exports increase and so does the AD. Aggregate supply Aggregate supply is the total supply of final goods and services that firms in an economy plan on selling in a specific period, usually a year. Macroeconomic short run aggregate supply In stage one which is the initial stage we assume that the economy has been in a recession. Therefore, the aggregate demand is weak and so is the price level, up to GDPu. Hence the AS curve is nearly horizontal. In stage 2, AS approaches full unemployment and the price level rises due to increased aggregate demand and higher input cost. (Most of the time an economy operates in this stretch and hence the SRAS {Short run Aggregate supply} is commonly drawn with a positive slope) if the economy grows further and reaches the nations production capacity GDPc firms are left with no resources and no matter how high the price level, the real GDP does not expand, and the SRAS is nearly vertical. Macroeconomic Long Run Supply Curve (LRAS) Shifts in SRAS Factors affecting shifts in SRAS 1) Input prices /cost of production If COP (cost of production) falls the SRAS will increase 2) Tax policy If taxes are reduced or subsidy is given the SRAS will shift to the right 3) Deregulation If regulations are removed or lessened the SRAS shifts to the right 4) Political/ environmental reasons Wars, Natural disasters will shift the SRAS to the left Shifts in LRAS (Long run aggregate supply) The LRAS can shift if: 1) New natural resources are found. 2) Improvement in technology increases productivity. 3) Government policy incentives Different national policies such as unemployment doles produces the labor supply as then many prefer not to work. Similarly, if government gives tax incentives at greater investment, the LRAS will shift to the right. Fiscal Policy Fiscal Policy The policy of the government as regards taxation, public spending and borrowing, to achieve various objectives of economic policy is called fiscal policy Objectives of economic policy 1) Economic/price stability, 2) Full employment 3) Economic growth 4) Equity 5) Equilibrium in the balance of payment Expansionary fiscal policy When an economy is deflated and suffering a recession or depression the real GDP is low, unemployment is high the equilibrium between AD and AS is located near the horizontal part of the AS. To boost the economy the government has to boost the AD which is AD = C + I + G + (X-M). During a recession consumer demand C is low therefore investment demand I is also low. This is the cause of the recession to counter this the government reduces taxes (both direct and indirect), to boost the C and I. Besides that, government spending is increased. The net result of this moves would be an increase in AD from AD0 to AD1. Thereby, there is an increase in real GDP from GDP0 to GDP1. Contractionary fiscal policy. If an economy is operating at/beyond full employment and inflation is a problem government needs to contract the economy. The equilibrium between AD and AS is in the vertical section of the AS curve. To reduce the price level the government need to decrease AD. AD = C + I + G + (X-M). During inflation consumer demand and investment are very high. To counter this govt will raise taxes (direct and indirect) to reduce C and I. Government spending will be reduced. The net result of these moves brings about a fall in AD Deficits and surpluses A budget deficit exists when government spending is greater than government revenue in a given period of time. A budget surplus exists when government spending is less than government revenue in a given period of time. Modern welfare states invariably have a deficit budget. National Debt – this refers to the borrowing of the government during a deficit budget. It is meant to bridge the gap between expenditure and revenue. When deficits are an annual occurrence the national debt gets accumulated. It is therefore that more borrowing needs to be done to repay old debts. This is called a debt trap. Financing of deficits 1) Borrowing o From the public o From banks o From other financial institution § E.g., IMF o Countries of the rest of the world 2) Creating money Creation of new money is done to avoid high interest rates caused by borrowing however it’s disadvantage is the risk of inflation. Handling of Surplus during Contractionary Policy 1) The government can pay old debts 2) To retire bonds 3) To retain the money Idle surplus funds can be locked up and be stopped from recirculating Automatic stabilizers – an automatic stabilizer is an inbuilt mechanism that increases a budget deficit during a recessionary period and increases a budget surplus during an inflationary period, without any change made by the government. These mechanisms are inbuilt into the tax system which automatically regulate and stabilise the economy. Progressive taxes and transfers 1) When an economy is booming the GDP is increasing and more households and firms fall into higher tax brackets. A strong economy reduces the need for transfer payments such as unemployment doles, old age pensions etc The progressive tax system therefore has an automatic contractionary mechanism during a boom. 2) When an economy is in recession and the GDP is falling more households and firms fall into lower tax brackets A weak economy increases the need for transfer payments by way of welfare measures (unemployment dole, old age pension) this softens the recession and automatically leads to a bigger deficit. Therefore this tax system has an automatic inflationary mechanism. In the above diagram with the given level of government spending, net taxes rise or fall with GDP. They reduce the negative effects of a recession when the economy is weak and they reduce the negative effects of an inflation when the economy is unduly strong. Difficulties of fiscal policy Crowding out – if the government borrows funds to fuel an expansionary fiscal policy it will have an effect on the market of loanable funds. It decreases the supply of loanable funds to the private sector and leads to an increase in the interest rate. This reduces capital formation and investment by firms (private sector) and it thwarts national growth. When the interest rate increases firms and households are crowded out of the market of loanable funds. When the government is fighting inflation with a contractionary fiscal policy we see the opposite of crowding out. There is a budget surplus, the government returns debts, the supply of loanable funds increases and interest rates fall. This is referred to as crowding in. Net export effect – if the government is borrowing during an expansionary fiscal policy, the supply of loanable funds reduces, the interest rate rises and there is a crowding out effect. Private sector or private firms are unable to invest and produce, and this has a negative effect on the foreign exchange rate Economic growth and productivity Productivity and its possibilities are graphically represented through a production possibility frontier. The perimeter of the frontier shows the existing limit of production possibilities. If an economy is operating inside the frontier, there is underutilization of resources. Such is the case in developing economies or LDC’s (Less Developed Economies). For growth to happen in LDC’s, the point of productivity would move towards the frontier. If greater productivity is to be achieved beyond the frontier, it can happen in the following ways. - The quantity of economic resources should increase E.g., New minerals, oil and other resources may be discovered - The quality of the existing resources improves E.g., Human resources improve with better training - If the technology in a given economy improves Monetary Policy Fractional Reserve Banking and Money Creation Fractional reserve banking is a system in which only a fraction of the total money supply is held in reserve as currency. This is done to theoretically expand the economy. It allows the bank to keep only a portion of the consumer deposits while lending out the rest. Banks use customer deposits to create new loans. The process of fractional reserve banking expands the money supply of the economy but not without the risk which the bank may face by depositor withdrawals. This system increases the money supply by lending the money multiple times over and helps in economic development. The banks use customer deposits to make new loans and the reserves are held in balances at the central bank. Money creation – an example of how the fractional reserve system can multiply bank deposits into new created money. Illustration If the cash reserve ratio (CRR), then the reserve ratio(RR) = cash reserve/Total deposits = 0.1 Money multiplier: - M=1/RR If RR = 10% therefore M= 1/RR = 1/10% = 10 Central Bank Each country has one central bank. It is the apex financial authority of the country Functions: - The central bank regulates the economy, fixes interest rates and controls the supply of money. It is a bankers bank. It keeps the mandatory reserves of the commercial banks, it is a lender of the last resort to commercial banks, and it provides clearing house facility to the commercial banks in their role of money creation. It is the governments bank, it keeps governments money such as tax revenue, it gives loans to the government, it is the bank of issue, it is the governments agent and it keeps the governments reserves of gold, foreign currency etc. it controls the supply of money, e.g. during inflation it tries to reduce money supply and during recession it increases money supply . Expansionary monetary policy This occurs when the monetary authority uses its procedures to stimulate the economy. It is used to treat unemployment and recession and promote economic growth. In this case, the supply of money is enhanced to increase the aggregate demand. Contractionary monetary policy. Here the money supply is restricted to fight inflation. The AD during inflation is high and efforts are made to reduce the money supply due money tools. Quantitative measures of monetary policy / Quantitative tools Bank rate - this is the rate charged by the central bank to the commercial banks for short term loans. This is discounted and hence known as discount rate. During inflation, bank rate is raised. This reflects on the interest rate of commercial banks, increasing it. Due to a high interest rate, deposits increase and loans decrease thereby reducing money supply in circulation. This reduces AD and helps bring prices down. This is termed as contractionary monetary policy. During recession it is imperative in this case to increase AD. Bank rate is decreased this reflects on interest rate of commercial banks, decreasing it. Due to low interest rates, deposits decrease and loans increase, thereby increasing money supply in circulation. This increases AD and brings up prices. This is termed expansionary monetary policy. Credit Reserve Ratio(CRR): The central bank sets a minimum amount of reserve requirement to be held by commercial banks. The minimum reserve is determined by the central bank and no bank can keep less than this. This safeguards the deposits of the customers in commercial banks. During inflation the central bank raises CRR so that less money is given out by way of loans. This reduces the amount of money in circulation this reduces the AD During recession the central bank reduces CRR so that more money is given out by way of loans. This increases the amount of money in circulation and thus increases the AD. Open Market Operations : This is an activity by the central bank wherein it buys and sells securities or treasury bills on the open market in order to regulate the supply of money. During inflation, the central bank will sell securities or treasury bills on the open market in order to regulate the supply of money. This will reduce AD and help lower prices. During recession, the central bank will buy back securities on the open market and thereby increase the supply of money. This will increase AD and help increase prices. Quantitative measures/Tools of monetary policy : - these include customer credit and margin requirements. Coordination of Monetary and Fiscal Policy / A Monetary Fiscal Mix During Inflation Microeconomics Demand – Is the consumers desire as well as their willingness to pay a price for certain goods and services at a given period of time Law of demand – all other things being constant, when the price of a good rises, the quantity demanded for those good decreases. Quantity demanded and price have an inverse relationship. Demand Curve Note: - Demand curve is always sloping downwards from left to right. Determinants of demand (Non price factors affecting demand) - Tastes and preferences/Trends and Fashion - Income o Normal Goods: if income rises, demand for normal goods will rise o Inferior goods: if income rises demand for inferior goods will fall - Price of substitute goods E.g., Tea and coffee are substitutes. Price of tea has been fixed for a long time but there is still a fall in the demand for tea due to the decrease in the price of coffee since consumers shifted to consume coffee. - Price of complimentary goods Complimentary goods are jointly consumed e.g., bread and butter. The demand for butter falls if price of bread increases. - Future expectations of price If there is an expectation that price will rise in the future, qty demanded will rise today. - Number of buyers in the market/ population Demand curve shifts when there are changes in the determinants of demand. Rightward shift = Increase in Demand Leftward Shift = Decrease in Demand Market forces – demand and supply Supply Law of supply – if price increases, the qty supplied increases; vice versa. Price and supply have a positive correlation. Note: the supply curve is sloping upwards from left to right. Determinants of supply - Cost of production: if the cost of production increases, then the supplier will be demotivated to produce/supply more as the profit reduces for the supplier. Therefore, the supply curve will shift to the left. - Technology and productivity: with technological improvement the productivity increases and the cost per unit might also fall. Hence profit will increase, and the supplier would like to sell more. Therefore, the supply curve will shift right. - Taxes: tax is an amount charged by the government when a particular product is sold/produced. When the tax increases. The profits reduce for the supplier due to which the supply will decrease, and the supply curve will shift to the left. - Subsidy: subsidy is an amount of aid or gift given by the government to the suppliers to help increase the productivity or to boost a particular sector of the economy. Subsidy reduces the cost of production, which motivates the supplier to supply more, hence the supply curve shifts to the right. - Price expectations: if the supplier expects the price to rise in the near future, the qty supplied today would fall, vice versa. - Number of suppliers: when more suppliers enter a market, we expect the supply curve to shift to the right. For e.g. During the strawberry season, many farmers try to grow strawberries in their free farmlands and hence supply of strawberries increases. Market Price - Over Supply – Supply>Demand – Price will Decrease - Shortage – Demand>Supply – Price will Increase Market equilibrium is the point at which demand, and supply curves meet. It is at that point at which price is set and that amount of a good is supplied and demanded. It is the point at which supply and demand of a good are equal at a fixed price level. Welfare Analysis Society is typically made up by consumers and producers. Hence in any particular free market when the demand meets the supply there is equilibrium. At equilibrium there is no wastage of resources, and the total welfare is maximized, which means all the producers and the consumers are happy with the situation. Free market – no government intervention – no taxes, no minimum wage etc. Total Welfare/Total Surplus – It is the sum of consumer surplus and producer’s surplus. Consumer Surplus – the situation in which the consumer benefits by getting the desired quantity of goods or services at the expected price or even lower. E.g., the consumer is willing to pay 5 dollars for an apple, but he gets it at 3 dollars then the consumers surplus is 2 dollars Producer Surplus – the situation in which the producer benefits by selling the desired quantity of goods or services at his expected price or even higher. E.g., the producer is willing to sell an apple for 5 dollars, but he gets 8 dollars then the producer’s surplus is 3 dollars. Consumers choice Utility It is the benefit or the satisfaction that the consumers experience by consuming goods and service. Total Utility It is the total amount of benefit or satisfaction received from the consumption of certain amount of a good or services. Marginal Utility It is the benefit or satisfaction received by consuming one extra unit of a particular good or service. e.g., If a person goes from 0 to 1 glass of water, his happiness increases from 0 to 10 points. Similarly, when he drinks 1 more glass of water the additional utility is 8 points. Diminishing Marginal Utility: in the table above, we can see a relationship between total utility and marginal utility. We can see that total utility increases but at a slower rate, and marginal utility keeps falling. Hence the law of diminishing marginal utility tells us that in a given period of time the marginal utility by consuming 1 extra unit falls (total utility increases at a decreasing rate). Constrained Utility Maximization With a fixed daily income and a price attached to consuming each additional unit is a constraint to our consumption pattern. So, we must ask aur self if one additional bottle of water costs me $1, then is it with the additional utility of 8 points. If the answer is yes, then you will consume the additional water bottle. If no, then do not consume it. Consumers are constrained by two things, price, and fixed income. One will keep consuming apples until a point when the utility of the last apple consumed is equal to the price I pay for that apple. Most consumers allocate limited income between many goods and services, each with a price that must be payed. Conclusion In this project, I conducted a comprehensive examination of the intricate relationship between economics and finance. The analysis encompassed macroeconomic theories, including the foundational contributions of John Maynard Keynes, emphasizing the essential role of government intervention in economic cycles. Key concepts such as the consumption function, propensity to consume, and the multiplier effect were explored, shedding light on their impact on aggregate demand. Beyond macroeconomics, the project delved into the complexities of aggregate demand and supply, scrutinizing their determinants and the factors influencing their shifts. A detailed exploration of fiscal policy, covering both expansionary and contractionary measures, provided insights into the government's pivotal role in shaping economic outcomes, including the management of budget deficits, surpluses, and the national debt. Shifting focus to monetary policy, the project elucidated fractional reserve banking, money creation, and the quantitative tools employed by central banks. The coordination of monetary and fiscal policies, known as a monetary-fiscal mix, was analyzed in the context of effectively managing inflationary and recessionary gaps. Within the microeconomic realm, fundamental principles such as the law of demand and supply, market equilibrium, and welfare analysis were explored. The study of utility maximization theories deepened our understanding of individual consumer choices within the broader economic landscape, especially when faced with constrained decision-making due to limited resources. Moreover, this project took a holistic approach by addressing critical dimensions of risk management and corporate governance. By emphasizing their significance, it underscored the pivotal role these elements play in maintaining financial stability and fostering ethical business practices. In synthesizing these diverse elements, this research contributes not only to a nuanced understanding of economic systems and policies but also highlights the imperative of prudent financial management and responsible corporate governance in navigating the complexities of the contemporary economic landscape. Previous Next