Marketing Mix: Product, Price, Place, and Promotion (4Ps) mont blanc perfume price in bangladesh

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To market the products (in broadest sense) every company needs to create a successful mix of right product at right price at the right place through right promotion. Thus marketing mix is made up of 4 Ps. The 4 Ps take care of 4 Cs relating to customers (see Table 16. 4)

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Table 16.4:4Ps and 4 Cs:

4Ps 4Cs Product Solution to Customer Price Value to customer Place Access to Customer Promotion Information to Customer

Before discussing about these Ps, one must note that all the Ps is interrelated. A decision to make change in one of them affects the rest. Suppose the company wants to launch low- priced product, the promotion has to follow suit and the same channels where premium products are sold cannot be used to provide access to this segment of customers. Second, each element of marketing mix contains countless variables.

Third, the 4Ps of marketing have been the key areas where marketing managers allocate scarce corporate resources to achieve the business objectives. Fourth, to show the differences between services and physical products, Booms and Bitner suggested the extension of the 4Ps framework to include three additional factors: People, Physical evidence and Process. Services have unique characteristics: intangibility, heterogeneity, inseparability and perish ability, and thus, require a different marketing mix.

Fifth, we are considered of the view that whether it is products marketing or services marketing, marketing mix must include all the 7Ps. Finally, the marketing mix will vary from industry to industry and organisation to organisation because of different offerings. Now we shall discuss them one by one.

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The Product (1st P):

Before we get into finer details about the product, it would be better to know what a product is. In its widest sense every offering that is being marketed can be called a product. Thus, not only a fridge, but fixed deposit facilities provided by a bank, lunch at a restaurant, polio vaccination campaign of UP Government, and promoting Jaisalmer during winters are all products.

It means every good (Sony TV), service (domestic maid), idea (eradication of TB), event (Wimbledon), etc. received in exchange is a product. A product may be either tangible (like this book), or intangible (telecom services).

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A product is a bundle of benefits which may be functional (car for transportation), social (status to own a car), and psychological (a security that I can always move due to car).

A product is inclusive of installation (an air conditioner is installed), guarantees (one year), warranty (replacement of defective part up to 10,000 km), product information (Information Booklet prescribing Dos and Don’ts) and after sale service (three free services for new cars).

A product offering has three independent elements (Kotler et al call it as 5 product levels). The first level is the core product – consisting of core benefit (a fundamental benefit – a tyre for a car). The second level comprises of supplemental features (Kotler calls them as expected and augmented product levels).

For a midway restaurant between Delhi and Jaipur, one expects clean wash rooms. Supplemental features add value to the core benefit in the form of TV, different kind of foods, free drinking water, bar, shopping arcade, lawns, fountains, etc.

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For a tyre, supplemental products mean installation, delivery, training, financing, replacement, etc. The third element is experiential benefit – when you go to a garage, the sitting arrangement for customers, some attendant offering water/tea/coffee, TV, day’s newspapers, timely servicing, etc.

Products can be consumer products and business products. Consumer goods can be classified as fast moving (soap, shampoo, etc.) and durables (washing machine, TV, microwave, etc.); and Convenience products (relatively inexpensive, frequently bought, with limited efforts, and not much fussy about brand — salt, bread, etc.), Shopping products (bought after investing some time and effort – furniture, washing machine, fridge, TV, camera, shoes etc), Speciality products (bought after spending considerable time and effort — Mont Blanc pen, expensive men’s suit, jewellery, first new car, an apartment, etc.), and unsought goods (consumers are unaware of, or aware but do not want to buy now, and solving sudden problems – video telephone, Encyclopedias Britannica, and nearest mechanic when car gets punctured).

Business products may be classified into installations (large machines); accessory equipment (calculators); raw materials (corn flour for soup powder making); component parts (mouse for a personal computer); process material (cardamom for sweets), Maintenance, Repairs, and operating items (detergents for cleaning factory floors); and Business services (Speed Post).

A single product is known as a product item. Closely related product items are referred as product line. Cinthol soap is a product item of the Soaps product line of Godrej Consumer Products Limited, as the product line (Group of closely related products) includes Godrej No. 1, Fair & Glow, Vigil and Evita.

A product mix is a total of all groups of products. To illustrate, all the Soaps, Personal Care, Toiletries, Shaving Creams, Talcum Powder, Liquid detergents, and Baby Care products constitute Godrej’s product mix.

The number of product lines refers to width of product mix; and number of product items offered in each product line is called as depth of product mix.

Like a human being, a product also has a finite life cycle. Though, some products like Coca Cola continue for a long time through improvements. Every product has four major stages: Introduction, growth, maturity and decline.

Marketers have to make many decisions about products, including Brand names, trademarks, and trade names. These names may be associated with founders (Tata Salt), Sports (Polo shirts), animals (Crocodile tee shirts), invented names (Dalda ground nut oil), abbreviated names (ICICI Bank, 3M, HDFC Bank), Gods (Natraj pencils, Shri Krishna Dhoop and Agarbatti), Forts and Palaces (Lai Quila Rice, Lai Mahal Rice), numbers (555 soap), number and words (7UP), geography (Woodland shoes, Fuji Camera), objective (Boost nutritional food drink granules) and fruits (Fruit of The Loom inner wear and casual wear). When a brand is registered with trademark authority, the owner gets exclusive authority to use.

Trade names refer to company names instead of product names. Brands may be manufacturer’s brands like Tata Motors, ACC cement, Reliance, et al. Private brands or labels refer to brand names owned by wholesalers or stores or dealers.

Manufacturers’ brands have to compete with private labels. Some brand names have become so popular that they have become generic names, like Dalda (HLL), Nylon (Dupont), Vim (HUL), etc. Companies may have individual branding (each product getting different name – HUL’s Lux, Dove, Pears, Rin, Surf, Wheel, and so on), family or umbrella branding (Godrej locks, hair oil, Godrej Fridge).

Next decision relates to packaging. Packaging protects and maintains the functional form of the product, provides convenience to consumers, and promotes the image of the company and the product. Dabur India uses reusable packages. Colours on the packages influence consumer emotions. Take the case of Nesle Coffee’s red and brown colour.

People prefer colours – Blue (for soothing), gray (strength), orange for low cost, red (excitement), Purple (dignity), yellow (joy) and black (strong and masterful). Closely related with packaging is labeling. Labels are used for identification, legal, informational and promotional purposes.

Product decision of marketing mix is concerned with both the existing products and the new products. In the old products companies create excitement through line extension, i.e., creating different fragrances in soaps or microwave to cook fish for Bengalis, chicken for Punjabis, Idli for South Indians, and Dal-Bati for Marwaris.

Another method used for existing products is known as product modification, i.e., changing one or more features of a product. Three major ways to modify include – quality (MRF introduced tubeless tyres), functional modification (Goodnight modified its mosquito-repellent with greater intensity, if the need be), and aesthetic modifications (altering taste, sound, smell, or appearances- as most automakers do).

With regard to new product development, a 7 steps process has to be followed – idea generation, screening, concept testing, business analysis, product development, test marketing, and commercialization.

The Price (the 2nd P):

Price is an important element in marketing mix, because it directly relates to revenue generation. Price is the one, which creates sales revenue – all other parts of marketing mix are costs. Pricing has to be done whenever a new product is launched, its variant is launched, a product is launched in new geographies, to counter inflationary trends, or company bids for industrial customers.

Pricing decisions are influenced by many factors – organisational and marketing objectives, pricing objectives survival, market share, profit maximisation, maximising market skimming, or product-quality leadership), costs (most of the airlines increase the fares due to increase in Gasoline pricing), other marketing mix variables (the product improvement and cost of promotion ) expectations of channel members (commission demanded by petrol pump owners is also a factor in oil pricing), customer interpretation and response (psychological pricing by Bata Rs, 99.95; at times lower price leads to the perception that product quality is lower), competition (Price of Coca Cola and Pepsi Cola are often highly competitive), ethics, Price sensitivities (See Boxl6…) and (A Public Distribution Dealer cannot charge prices lower or higher to what prices are fixed by the government). A company must set the price in relation to value delivered and perceived by consumers.

There are numerous pricing strategies:

A. Product Line Pricing:

1. Premium pricing (Charging a high price, with good quality product/service – like Mark & Spencer products)

2. Captive product pricing (Products that complement others, like cheaper tooth paste and costly tooth brush, cheaper printer costly cartridge)

3. Bait Pricing (Low price of one item to attract customers to store for selling a higher priced item in the line, like Reality developers)

4. Price Lining (Different prices for different combinations – Tata Sky gives different channels packages at different prices)

5. Volume Pricing (Rationale of Product range, like ice cream cup Rs. 15, family Pack Rs. 50, and giant size Rs. 75)

B. New Product Pricing:

1. Penetration pricing (Low price to gain market share and then increase price, like Tata Telecom)

2. Price skimming (High initial price, in future price will come down to parity, like films on release)

C. Psychological Pricing:

1. Reference Pricing (Pricing at moderate level a product kept next to a more expensive product, so that customer can differentiate between moderate and better products)

2. Group or Bundle Pricing (Package to contain two or more products and the package is priced, like tour to Europe Price includes air fare, transfers, sight-seeing, hotel, and food)

3. Multiple – Unit Pricing (in Big Bazaar socks with three pairs are per unit cheaper than buying one pair)

4. Everyday Low Prices (Instead of declaring frequent short-term price reductions, marketers keep the prices otherwise low, like Wal-Mart-“Always Low Prices. Always.”)

5. Odd Pricing (Bata keeping price at Rs. 995.99 for women’s saddles)

6. Prestige Pricing (Keeping higher price because customers believe that a higher priced product is of better quality).

D. Promotional Pricing:

1. Price Leaders (Keeping low prices of some products in the hope of sale of other regularly priced items, like lower sugar price and regular pricing for tea leaves, milk and cardamom)

2. Special Event Pricing (Most of the big stores announce lower prices on the eve of Diwali, Id, Gurpurab, 25 th December, 15 th August)

3. Comparison Discounting (Company writing earlier higher prices along with current lower prices for comparison by the customers)

4. Economy pricing (No frills and low price, like Indigo Air)

5. Cash Rebate Pricing (Purchase air ticket from makemytrip.com and get air ticket from makemytrip.com and get a cash back of Rs. 300)

6. Other promotional pricing strategies (Includes Low Interest financing, longer payment terms, extended warranties and Service Contracts, and Psychological Discounting)

E. Other Pricing Strategies:

1. Pricing variations (Early bird discounts, like ticket booking one month in advance at lower price)

2. Optional product-pricing (Optional extra, like stereo price extra in Alto Car)

3. Geographical pricing (Different prices in different geographies, like Indian Oil charges different prices for petrol and diesel in different cities)

4. Value pricing (Difficult economic conditions and marketer making value offering, like restaurant offering value menu)

5. Transfer Pricing (Price charged for intra-company or group companies selling).

The basis for pricing may be Cost-based methods include Mark-up pricing (Cost plus predetermined Profit), and Target Return (Cost plus say Rs. 5; or 15% Return on Investment); Demand-based pricing includes Perceived Value Pricing (What customers think ) or greater the demand greater the price and vice versa (as happened during strike by Air India); Competitor-based pricing includes Going Rate (Price equal to competitors); and other bases are Group Pricing (All accessories in the bathroom included in the quoted price); Sealed Bid (Normally fixed cost not considered); and Value Pricing (What the sellers think).

No pricing decisions will be complete without discussing discounts and allowances. These are very popular in business to business marketing. In some of the industries, even for retailing, like electric switches and sockets, discounts are the normal feature.

These include Trade Discount (extra goods for no extra price), Quantity Discount (greater the buying greater the discount), Cash Discount (for before maturity payment, called ‘muddat’ in Indian terminology), Seasonal Discount (buying half sleeve shirt during winters), and Allowances (for swapping/exchanging old product for the new one – exchange your old Jen with new Jen car and pay 40,000 less), meeting 50% cost of promotion of the dealer, Invitation to participate in Hong Kong Conference to top 10 dealers).

The Place (The 3rd P):

Place is concerned with making available the products at a place where (s) he demands. Thus, it is concerned with the store where the goods shall be displayed and sold, the channels of distribution and logistics management through which goods will flow from marketer to consumers.

Chain or path or route in the channels may be marketer to consumer (through factory outlet or internet or company owned stores, or mail order business or door to door sales, or multilevel marketing as done by Amway), or marketer to retailer to consumer, or marketer to wholesaler (also referred to as distributors) to retailer to consumer, or agent to wholesaler to retailer to consumer. The organisations between the marketer and the consumers are known as intermediaries. Each one of them has an important role to play.

A Retailer is an important bridge with the consumers as he has much stronger personal relationship with the consumer, holds a variety of products, offers consumers credit, promote and merchandise products, prices the final product, and builds retailer ‘brand’ in the high street.

A Wholesaler breaks down ‘bulk’, buys from producers and sells small quantities to retailers, provides storage facilities, reduces contact cost between producer and consumer, and takes some of the marketing responsibility, e.g., sales force, promotions.

In some of the trades no trade is possible without agents. To illustrate, in foods, jewellery, monetary products, metals, etc, agent is a must. But in international markets, their role is undisputed. They (Commission Agents) do not take title of the goods, secure orders, and (Stockist agents) hold ‘consignment’ stock.

With the advent of internet and WWW the concept of channels has undergone a sea-change and there is a paradigm shift in marketing and consumption. Through internet marketer can sell to a geographically disperse market, target and focus on specific segments, relatively keep low costs set-up, and makes use of e-commerce technology (for payment, shopping software, etc).

With regard to channel six basic decisions are to be made -direct or indirect channel (in certain sectors, both direct and indirect channels may be used. Hotels, for example, may sell their rooms directly or through travel agents, tour operators, airlines, and tourist boards.

With centralized reservation systems, etc. the process of transfer the products or services is shifted from Producer to Customer or end user.), single or multiple channels, length of channel, types of intermediaries, number of intermediaries at each level, and selection of particular intermediaries. Many marketers seem to assume that once their product has been sold into the channel, into the beginning of the distribution chain, their job is finished.

Yet that distribution chain is merely assuming a part of the marketer’s responsibility; and, if they have any aspirations to be market-oriented, their job should really be extended to manage all the processes involved in that chain, until the product or service arrives with the end-user. All these decisions have to be made by individual marketer.

Selection of a channel which is flexible, effective, and consistent with the declared marketing policies and programmes of the firm is very important. While selecting a distribution channel, an entrepreneur should make a trade-off analysis of the costs, sales volume, and profits expected from alternative channels of distribution and take into account the factors – (i) Product Consideration (Unit value, perish ability, consumer versus Industrial Products, width and depth of product mix, and Existing product versus new product) ; Market

Consideration (industrial market doesn’t need middlemen, number of prospective customers, geographic spread, and order size of customers), and Other C fbtaamay. montblanc penonsiderations (Age of marketer, availability of finance, Cost of each channel, and demand for the product). The nature and the type of the middlemen required by the firm and its availability also affect the choice of the distribution channel.

A company prefers a middleman who can maximise the volume of sales of their product and also offers other services like storage, promotion as well as after-sale services. If the requisite kind of middlemen is not available, the manufacturer will have to establish his own distribution outlet.

Type of Marketing Channel:

1. Intensive distribution:

Where every kind of retail outlet is used. For example Coca Cola uses Grocery Stores, Panwalas, and the restaurant owners to market its beverages, and hul uses not only grocery stores but also chemists to market its soaps and shampoos. This kind of distribution is suitable for convenience goods, like bread, butter, egg, newspapers, namkins, potato chips, etc.

2. Selective distribution:

Only a few outlets in an area are to distribute a product. It is most suitable for shopping products which include consumer durables.

3. Exclusive distribution:

Only one outlet in a bigger geographical area is used to sell the product. Exclusive distribution is used for costly, fashionable items whose sale is limited. There is only one Mark & Spencer outlet in whole of Delhi.

Major Types of Retail Stores:

The Major Types of Retail Stores found in India are listed below:

1. Mom and Pop Stores:

These are the stores run by the family. India has a large number of Mom & Pop Stores. The stores seen by you in your colony or street, wherefrom you buy milk, bread, grocery, stationary, medicines are mostly these kind of stores only.

2. Department Stores:

These are large retail firms, have wide product assortment (mix), and organised into separate departments. Some of them also engage in online business. The services are so varied that many a times the owner leases out space to others for these services.

3. Discount Stores:

These are self-service, general merchandise stores, regularly offering national, regional, and store brands at low prices. They believe in volumes. Wal-Mart and Target are the two largest discount stores.

4. Convenience Stores:

These are small self-service stores, open for long hours, and normally carry convenience goods like soft drinks, snacks, cigarettes, chocolates, newspapers. The stores run at Petrol Pumps in India are convenience stores. Convenience stores may also be located at the corner of your street.

5. Supermarkets:

These are big, self-service stores, carry a complete line of food and non-food products (like cosmetics and over the counter drugs), organised into efficient different departments, offer lower prices than small neighbourhood stores),and central checkout. Kishore Biyani’s ‘Big Bazaar’ comes very close to this category only.

6. Superstores:

These are an amalgam of supermarkets and discount stores. They carry other routinely purchased items apart from food and non-food products of supermarkets- food to clothing, appliances to furniture, gardening equipment to artificial jewellery.

Superstores are spread over 2, 00,000 square feet area. Those who shop there have free parking. Sales volume is twice or thrice of supermarkets. Bangalore’s ‘Bangalore Central’ can be put in the category of superstore.

7. Hypermarket:

These stores are spread over 2, 25,000 to 3, 25,000 square feet area and offer roughly 45,000 to 60,000 different types of low-priced products. Roughly half of the space is allocated to groceries and rest is meant for electrical and electronic appliances, shoes, toys, house wares, hardware’s, furniture, etc.

Space is leased to banks and fast food restaurants. According to Wikipedia the examples of hypermarket in India include India Sarvana Stores in Chennai, Big Bazar, Trent, Landmark, Spencer’s Retail, Vishal mega mart, Reliance Fresh, More, etc.

8. Cash-and-Carry Stores:

In India recently, some cash-and-carry stores, also known as Warehouse Clubs, have opened. Important among them are Bharati-Walmart (Punjab), Carrefour (in trans-Yamuna area of Delhi).

These are for members only and engaged in wholesaling only. To keep prices lower than supermarkets and discount stores, they provide little range of sizes and styles and services. They do not advertise, except through SMS and e- mail.

9. Warehouse Showrooms:

IKEA, a Swedish firm sells furniture, household goods and kitchen accessories through catalogues across the world. Five important features of a warehouse showroom are large, low-cost buildings, warehouse materials-handling technology, vertical merchandise displays, large on-premises inventories, and minimal services.

10. Specialty Retailers:

These stores offer wide assortment in few product lines. In case of jewellery we have many such stores, like Suranas of Jaipur, PC Jewellers of Delhi, Ramchandra KrishnaChandra of Chandni Chowk, and Saboos of Delhi in sarees. These are traditional speciality stores and deal in one product line.

Another category of speciality stores are known as off-price retailers, who buy manufacturers’ seconds and off-season products at below-wholesale prices for resale to consumers at deep discounts. One good example is ‘Thapars’ who organise sale of such goods in Delhi.

11. Chain Stores:

These stores provide similar services or products, and share a brand. They inevitably also share some degree of central management, supply chains, training programs, personnel, etc.

They tend to either be parts of a single company or franchises, in which individual store owners license the use of the shared brand, training, and know-how. McDonald’s is the largest in the world in running chain stores. Bata is another good example of chain stores.

12. Multi-level Retailing:

It is also called network marketing. It is a mix of direct selling and franchising. Three notable companies in this kind of business are Amway India, Oriflame India (beauty products), and Tupperware India (food grade plastic containers). Amway has over 5, 50,000 active independent business owners.

13. Mail Order Retailing:

The mail order business is not new to India. Publishers and pharma companies have been doing it for a long time. Recently Sky shopping, popularly known as the Direct Response Television (DRTV) industry has also become very important form of marketing through mail.

14. Non-Store based Retailers:

The mail order houses, online businesses, vendors, and hawkers are examples of non-store based retailers.

Logistics Management:

For smooth inflow of goods from manufacturer to ultimate consumers, there are many backend operations which are performed by Logistics. It basically includes – Order

Processing (receipt and transmission of sales order information), inventory management (when to order and how much to order), materials handling (physical handling), Warehousing (design and operation facilities for storing), and transportation (movement of goods to intermediaries and ultimate users).

The promotion (The 4th P):

Promotion relates to communicating with customers. It will provide information to assist them in making a decision to buy a product or service. The cost associated with promotion often represents a sizeable proportion of the overall cost of producing an item. However, successful promotion helps to build long term relationship. With increased sales due to promotion, costs are spread over a larger output.

Though increased promotional activity is often a sign of a response to a problem such as competitive activity, it enables an organization to develop and build up a succession of messages and can be extremely cost- effective. Here, the company should follow Integrated Marketing Communication (IMC), which means coordinated use of promotion mix to send a consistent message.

Promotion mix contains four elements: Advertising (paid, non-personal communication through mass media), Personal selling (a paid personal communication to inform and persuade customers to purchase), Sales Promotion (to provide added value or incentives to consumers, wholesalers, retailers, or other organizational customers to stimulate immediate sales), and Public Relations (a broad set of communication efforts to create and maintain favourable relationship between organisation and stakeholder).
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mont blanc bags australia In Focus Metroplus Tracing the fragrant attar Sohini Chakravorty July 31, 2012 16:35 IST Updated: July 31, 2012 19:44 IST Share Article PRINT A A A

WHIFF OF HYDERABAD: Attars seller with bottles of attar which are in huge demand during Ramzan. Photo: K. Ramesh Babu  

Sohini Chakravorty July 31, 2012 16:35 IST Updated: July 31, 2012 19:44 IST more-in The attar shops have been part of the city for years. Sohini Chakravorty finds what makes them last so long

A walk around the chaotic streets of Charminar especially during the month of Ramzan is always a revelation. Numerous old shops stand shoulder to shoulder. Tucked in corners are a few small shops selling attar, some of which have been here since 1897. To any casual observer they almost look like curio shops. Despite attar losing its popularity to international branded perfumes and deodorants, it still has many takers in the Old City of Hyderabad.

The strong fragrance of the attar meanders around the shops beckoning some of the curious passers by. Rows of shiny bottles line the walls of these shops. Small steps lead to the elevated shops and the owners sit on a takht with roll pillows neatly placed on either side as they ask their customers to comfortably settle down. The process of dabbing a small drop of attar on hand and taking a long strong whiff is what follows next. “Attars are perfumes without alcohol and that’s important for the Muslims,” says Divesh Kothari whose ancestors migrated from Gujarat and started the attar shop Bhagwan and Company during the time of the Nizams. He says it’s not just the Muslims, even people of other religions use attar for their auspicious ceremonies.

Some of the natural perfumes have been in the market for 60 to 70 years but synthetic perfumes give more scope of mixing different fragrances. “Natural perfumes have sandalwood oil which is why they are very expensive. Only the Nizams could afford it, while the synthetic ones are cheaper. Even the odour lasts longer,” informs Divesh Kothari.

Ashwini Kumar is the fourth generation attar seller of the famous Purnadas Ranchhoddas shop. He says due to the numerous government restrictions on sandalwood oil, natural attars are difficult to make. While floral and herb extracts go into making natural attars, aromatic chemicals are used to get the desirable fragrance for the synthetic one. “There are two different ways of making attar — one is the distillation process used to make the natural ones and the other is blending. It’s blending of essential oils,” he explains. About 3 ml attar can cost Rs.30-100 depending on the variety. Attar has a huge market among the foreign tourists as well. If it’s not the smell of the perfume, the beautiful glass bottles attract these customers. Tourists from all over the world come to these shops hunting for attars as a souvenir.

However, there are people like S.A. Gaffar who claims to make natural attars. Apart from attars, he has surma and few books on Islam. Snugly fitted between a glass cupboard and a wooden bench, he takes out a bottle of sandalwood oil and says, “I make them at home, and it takes almost three to four months to bring out a bottle of attar.” In a year he makes around 10 kilograms of attar and the price range also starts from Rs. 200.

The aromas of attar may have lost their fragrance in modern times, but the age old attar sellers are unwilling to give up their family business. Simply walking down these shops makes one realise why, after all a slice of Hyderabad is blended into these attar bottles.

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