59

report on their findings and, finally, make sure that the report is available to everyone concerned in the process.

Marketing practice:

Case study: Breaking glass

One way of quickly assessing the health of a company is to perform a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis.

Strengths and weaknesses are internal issues such as product quality and working relations, while opportunities and threats are external issues, such as new markets and foreign competition.

Read the information about the Macbeth Glassware Company.

Macbeth Glassware

Macbeth Glassware, founded in 1837, has a long history of producing beautiful glass objects and ornaments. They have always been popular wedding presents. Glassblowing and glass-cutting, which are performed by hand, are highly-skilled jobs and Macbeth employs some of the best craftspeople in the world (average age 53). The factory produces over 8,000 glass objects per year, of which 1,000 are responsible for 80% of overall sales. There is a lot of waste and breakage. Each item is inspected by a supervisor who checks it for flaws and then issues a certificate of authenticity. Up to 20% of finished items are sold as seconds (with only small defects), and the remaining 5% are melted down and recycled.

The company employs 600 people. 200 produce the goods, and the rest are clerical staff, working in the stock room, or are managers. Most craftspeople are paid on a piece-work basis (for how much they produce), and feel that they have low status in the company. There is a big division between blue-collar staff and white-collar clerical workers, with separate restaurants and facilities for factory workers and management. There are five levels of management in the company, and a poor relationship exists between management and the workforce.

Sales have fallen dramatically in the past three years. There is a strong competition from Czechia and Poland, which produce good quality goods which are less expensive. Department stores have complained about late deliveries and slow ordering facilities (mail order only). A few years ago the company launched a cheaper range of glass

61

Unit 6

Marketing research 1

Types of research

Marketing research is the process of gathering information about a market, analyzing it and interpreting it. Although the term market research is often used to mean the same thing, technically it only refers to research into a specific market.

Consumer research – used to discover behavior patterns (how people act) and customer needs – is an essential element of marketing research.

Motivation research investigates the psychological reasons why individuals buy specific types of merchandise, or why they respond to specific advertising appeals.

There are two main methods of consumer research:

desk (desktop) research or secondary research: an analysis of the information you can find easily without leaving your desk. Examples include the internet, books, newspapers, magazines, and government statistics.

field research or primary research: involves talking to people and finding out what they think about a market, a product, a business sector, etc. It is usually carried out by market research institutes.

Consumer research can be either quantitative or qualitative. In qualitative research, small group discussions or in-depth interviews with consumers are used to understand a problem better. Quantitative research involves collecting or gathering data (for example, on how many people use different products), followed by statistical analysis

– examining, or analyzing, the data. Quantitative research is often used to investigate the findings from qualitative research.

Marketing research techniques

Focus group typically consists of five to nine recruited consumers who sit together to discuss a product, ad, or some other marketing topic introduced and led by a trained moderator.

Package test is used to test ideas for new packaging, could be in a focus group. Taste test is used to test what consumers think about new flavors.

Home test: consumers try the product at home, in a real situation.

62

A self-administered questionnaire is completed (or filled in) by the respondent.

An interviewer-administered questionnaire is filled in on behalf of the respondent by an interviewer.

Telephone surveys are carried out by telephoning the respondent and asking questions.

A mail survey is mailed to the respondent, who completes it and posts it back. Online surveys are administered on the Internet.

Mystery shopping: a person poses as a consumer and checks the level of service and hygiene in a restaurant, hotel or shop.

Omnibus surveys: a market research institute carries out research for several companies at the same time. A long survey is given to respondents, some institutes have a panel of existing respondents who are accustomed to answering the surveys.

Language focus

1.Look through the article and find words and word partnerships corresponding to the words and word partnerships given below.

63

2.Match the types of research with the research problems below. Look at the text to help you.

1.The R&D department want to know why people buy mobile phones so that they can develop a new model that meets all the major needs.

2.The design team want to know how consumers feel about the new layout of the company website before they finalize and launch the new homepage.

3.A manager wants to have financial data on her company, her competitors and the economy in general.

4.The marketing team want to have a lot of data on their consumers: age, shopping habits, email address, etc.

3.Complete the sentences. Look at the text to help you.

1.A lot of marketing research institutes carry out ….. surveys. They ring people at home and ask them questions.

2.A ….. is a small discussion group, led by a ….. who asks questions to get and qualitative information.

3.A marketing research institute may prepare a lengthy ….. survey which it posts to consumers at their homes. These ….. surveys have questions from several different companies on them.

4.Some questionnaires are completed by the ….. (self-administered questionnaires) and some are completed by the interviewer ( ….. - ….. questionnaires)

5.….. surveys are usually carried out in-store to assess the levels of service quality and cleanliness.

6.A ….. test is designed to find out what consumers think about packaging, and a

…..test is to find out what they think about the flavor of a product.

4. Complete the text below with words and phrases given below.

64

Organizations which want to find out how the public (1) _____ their products or services usually carry out some form of (2) _____. A street (3) ____ where passers-by answer questions or complete (4) _____, is the most common method. Another is

(5) ____ testing, where volunteers taste and analyze anonymous (6) ____ of food and drink. A (7) ____, where a researcher visits households and studies the labels of the products which have been consumed, is useful for longer-term research. A very sophisticated technique is to run a (8) ____. This is where a researcher encourages a group of (9) ____ to discuss their (10) ____ to different products. This discussion is secretly observed and often filmed.

5. Translate the text into English. Use the following connecting words or phrases such as:

Личный опрос (индивидуальное интервью), когда один исследователь задаёт вопросы одному респонденту, имеет большое преимущество: интервьюер получает возможность быть гибким при постановке исследовательских вопросов и фиксировать ответные реакции опрашиваемого. Однако индивидуальные интервью имеют один весьма существенный недостаток – они очень дороги.

Опросы по почте обходятся, как правило, дешевле личного интервью, но в этом случае готовность к ответу может проявить лишь тот респондент, который имеет положительный или отрицательный опыт использования исследуемого продукта и у которого есть время на переписку. С точки зрения гибкости и издержек опрос по телефону занимает промежуточное (intermediate) положение между двумя этими методами опроса.

В связи с высокой стоимостью проведения личных интервью на дому у опрашиваемых широкое распространение получили интервью в местах продаж, которые представляют собой личные опросы покупателей в торговых центрах. Благодаря таким беседам один на один снижаются затраты на визиты в дома потребителей; при этом обеспечивается гибкость опроса, поскольку интервьюер получает возможность демонстрировать респондентам наглядные материалы – рекламные объявления или образцы реальных товаров.

65

С развитием компьютерных технологий появилась возможность моделировать «виртуальные посещения» магазинов, когда респондент, участвующий в опросе, «ходит» по магазину и «покупает товары», сидя у монитора.

6.There is a STEEP analysis which involves examining the social, technological, economic, environmental and political factors that affect an organization. STEEP analysis relates to a marketing and strategic instrument for studying the macro environment in which we carry out our business activities. Regular use of such a management instrument can help us find opportunities for growth and set a clear direction for our operations.

What does the acronym STEEP stand for?

STEEP analysis 1. Social factors

Changing demographics over time, based on pattern of birth and death of the population

Changes in life style, recreation and leisure patterns Changes in social trends, including migration pattern

2. Technological factors

Information technology for business management Social networking

3. Economic factors

General economic trends and changes in local, national and global markets Tax and insurance

4. Environmental factors

Energy efficiency and sustainability, i.e. using raw materials and energy in a manner that does not harm the environment

Recycling waste material

5. Political factors

National legislation that regulates competition Protection of consumer rights

66

7. Translate the following text.

Анализ внешней и внутренней среды маркетинговой деятельности в России

В ходе анализа внешней и внутренней среды были выявлены следующие тенденции:

1)рост числа пожилых россиян;

2)движение в сторону философии «делай сам» и «полагайся только на себя»;

3)миграция населения;

4)перемены в семейно-брачных отношениях;

5)усиление дифференциации населения по уровню доходов;

6)изменение структуры потребления;

7)широкое применение информационных и коммуникационных технологий;

8)применение новых технологий, что приводит к снижению цен на товары;

9)формирование финансово-промышленных групп;

10)рост числа малых предприятий;

11)расширение прав потребителей;

12)принятие законов, защищающих права потребителей;

13)совершенствование нормативной базы, регулирующей конкуренцию.

Marketing practice:

1.Work in pairs. Imagine you run a market research organization. Discuss which research methods you would recommend to clients in these four situations. Explain why.

1.A manufacturer of a substitute for butter wants to know how to position its product against its competitors. The manufacturer would like to know what consumers think of the taste compared to rival products, including butter.

2.The managers of an airport want to find out how travelers and passengers perceive the services offered inside the airport terminal.

3.A marketing research organization has to produce monthly reports with information about the buying habits of consumers. It studies the same consumers over a period of several years.

67

4.The directors of a supermarket chain want to find out why customers prefer their main competitors.

5.A city administration wants to find out how effectively local transport system works and if the passengers are satisfied with its services.

Marketing Research 2

Talking about numbers

68

Describing survey results

There is a number of different ways to talk about survey results.

Understanding trends and changes

Look at the graph showing consumer ratings of the product over a ten-year period. Translate the presentation made on the basis of the graph showing the results of a survey of consumer ratings for a brand of mobile phones.

70

60

50

40

30

20

10

00

69

The graph shows consumer ratings of the product over a ten-year period. You can see that after the launch of the product the ratings rose to 33%. The trend was stable until the arrival of a major competitor in the market. This led to a slight fall in approval ratings. The relaunch of the brand invigorated the product and so you can see ratings rose to 60%, the ratings doubled. However, reports in the national press have had a negative effect on the brand image and approval ratings have dropped. Compared to the same period last year, a significantly higher number of consumers have a low opinion of the product and the brand image. The percentage of dissatisfied respondents has trebled.

Although it seems to be very negative, your initial guesstimates, your predictions before you had the figures, were much worse.

Notes:

rating – оценочный коэффициент; оценка approval rating – положительная оценка guesstimates – предварительные расчёты

Percentages, fractions and proportions

Read the text and draw a pie chart according to it.

The pie chart shows the split (or breakdown) of our annual marketing budget. We have just over $7.5 m. Of this we will spend roughly half a million on advertising, and approximately $1m on promotions. We will use almost $3 m on direct mail, and postage and handling charges will represent exactly 72% of that $3 m. We will spend

72

(such as deciding to purchase a bottle of mineral water) and extended problem solving (such as deciding to buy a new car).Many decisions fall somewhere in the middle and are characterized by limited problem solving, which means that consumers do work to make a decision, but in most cases they rely on a simple rule of thumb instead of learning all the pros and cons of every product alternative.

Purchase involvement determines the extent of effort a person puts into deciding what to buy. As a rule we are more involved in the decision making process for products perceived as risky in some way. Perceived risk may be present if the product is expensive or complex and hard to understand. Perceived risk can also take place if choosing the wrong product affects a social image of a consumer. When perceived risk is low, as in buying a bottle of mineral water, the consumer feels low involvement in the decision making process.

In low involvement situations, the consumer’s decision is often a response to environment cues, such as when a person decides to buy a product because it is permanently displayed at a store checkout counter. Under these circumstances, managers must concentrate on how products are displayed at the time of purchase to influence the decision making.

For high involvement purchase, such as buying a house or a car, consumer is more likely to carefully examine all of the available information and to think about the decision well before going to buy the item.

Comprehension / Interpretation

1.What kind of process is consumer behavior? Why is it important for marketers to understand consumer behavior?

2.What steps do consumers take to make a purchasing decision?

3.What was the traditional marketers’ view on how consumers approach to making a purchasing decision?

4.What does making a purchasing decision depend on now?

5.What is the difference between habitual decision making and extended problem solving?

6.What do we mean under a perceived risk?

7.When speaking about purchasing products we use the term involvement. What is meant under involvement?

8.What other examples of low involvement goods can you think of?

9.What other examples of high involvement goods can you think of/

73

Language focus

1.Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

2.The marketer needs to know what people are involved in buying decisions and what role each person plays. Consider the selection of a family car.

Identify the role of each person involved in purchasing a car and a decision maker.

user influencer initiator buyer decider decision maker

1.The initial suggestion might come from the oldest child. He or she would be the

…..

2.A friend or colleague might advise the family on the kind of car to buy. He or she would be the ….. .

3.The husband could be the one to choose the make while the wife might have a definite opinion regarding the car’s style. They would be the ….. .

4.The husband may well be the one actually to buy – the ….. .

75

4.Goods that last a long time, such as cars, ‘white goods’ (fridges, cookers), ‘brown goods’ (televisions, stereos), etc.

5.How people in general feel about their job security, future economic prospects, etc.

6.How different people react to marketing stimuli, depending on their psychology, their cultural and social background, and their economic situation.

7.The amount of money being spent on consumer goods and services, which fluctuates with recessions and booms.

8.The amount of money borrowed by people to buy goods and services, depending on confidence and the economic cycle.

9.The individuals and households that buy products for their own personal consumption.

10.When customers refuse to buy the products of a company they disapprove of for ethical or political reasons.

5. Complete the paragraph with the collocations from the exercise given above.

A government spokesman yesterday insisted that the latest figures showed that

(1) ….. was returning, and that (2) ….. was increasing. Several retailers disagreed, and suggested that sales of (3) ….. had only increased in January because all the major stores had had extended winter sales and discounted prices by up to 20%. The banks say that the level of (4) ….. remain low because many people pay off earlier debts, and are afraid to make new ones.

6. Translate the following sentences into English.

1.Наша первоочередная задача – оправдать доверие покупателей к нашему продукту.

2.Снижение покупательского кредита обычно происходит во время экономических спадов и показывает, что потребители не хотят брать на себя обязательства (commit oneself to) по долгосрочным выплатам.

3.Потребительские расходы снижаются, особенно на товары длительного пользования – кажется, никто не заинтересован в покупке нового автомобиля.

76

4.Используя выводы и мнения потребительских панелей (постоянных выборок респондентов) по всей стране, нам удалось реконструировать свыше 1000 существующих товаров.

5.Профиль потребителей нашей компании значительно моложе, чем профиль потребителей наших конкурентов. Это объясняется модным имиджем одежды, которую мы продаём.

6.Потребительские привычки и покупательское поведение меняются по мере перехода

семьи от одного жизненного этапа к другому.

7.Market segmentation identifies groups of buyers within a market who share similar needs and demonstrate similar purchasing behavior.

Read the definitions of segmentations and find the appropriate type to each of them.

1.Dividing a market according to the areas the company operates _____

2.Dividing a market according to consumers’ age and life cycle _____

3.Dividing a market according to gender _____

4.Dividing a market according to how much money a person earns _____

5.Dividing a market according to consumers’ education and lifestyle, their personality characteristics _____

6.Dividing a market according to buyers’ knowledge of a product, their attitude, uses and responses to a product _____

7.Dividing a product according to the different benefits that consumers seek from the product _____

8.Translate the following word partnerships into English.

1.Сегментирование по психографическим признакам (подразделение покупателей на группы по принадлежности к общественному классу, образу жизни, уровню образования).

2.Сегментирование по географическому признаку.

3.Сегментирование по уровню доходов.

77

4.Поведенческое сегментирование (по характеру поведения покупателей, их осведомлённости о товаре).

5.Сегментирование на основе искомых выгод от покупки товара.

6.Сегментирование по признаку пола.

7.Сегментирование по демографическим признакам (по возрасту, религиозной принадлежности, жизненному циклу).

9. There are five commonly accepted market segments.

Match the definitions of the segments to their names given below.

Kid’s arts and crafts is brighter than ever, say many retailers. “This (1) ….. segment is growing without question. We’re seeing a larger population of young kids entering school than in previous years and creating a great opportunity,” said Walgreens’ spokesperson Anne Venable.

An increasing number of products are (2) ….. at parents and grandparents who want their kids to be smart and creative, not just television junkies.

Grandparents are a customer segment with strong economic (3) ….. . It is relatively easy to (4) ….. to them using positive images of their grandchildren.

78

Steven Jacober, SHOPA’s president, agrees: “Art supplies and crafts continue to grow. This ties into the baby (5) ….. generation, the way they are raising their children and their tendency to make everything a learning experience. There are a lot of different factors, and the demographics support continuing growth of the marketplace,”

Arts and crafts are targeted at households with (6) ….. , kids aged 12 years and under.

11.Think about yourself. Which market segment(s) are you in? Is it the same for your friends and relatives? List some products or brands that are targeted at you.

Unit 8

Products

Text 1 Read the text and answer the questions below.

Product developers need to think about their products on three levels. The most basic level is the core product – what the buyer is really buying. Marketers must uncover the needs hiding under every product and sell benefits not features. The core product has to be turned into a tangible product. This may have five characteristics: features, a brand name, styling, packaging and quality levels. Finally, the product may offer additional services and benefits that make up an augmented product.

The average cost of developing and introducing a new product from scratch has jumped to over $100 million. To make things worse, many of these costly new products fail. So, companies are now pursuing new product strategies that are less costly and risky than developing completely new brands, There are three product strategies: acquiring new brands, developing ’me-too’ products, and reviving new brands.

Acquiring new products

Instead of building its own new products from the ground, a company can buy another company and its established brands. The mid-1980s saw a lot of company mergers: Procter & Gamble acquired Richardson-Vicks, Nestle absorbed Rowntree Mackintosh, Schweppes merged with Cadbury.

Such acquisitions can be risky – the company must be certain that the acquired products blend with its current products and that the firm has the skills and resources needed to continue to run the acquired brands profitably. On the other hand,

2. Complete the definitions with the terms given below.

1.Goods that are used up or last for less than three years. _____

2.Goods that have a limited shelf life and must be consumed relatively quickly, such as fresh fruit, fresh meat and eggs. _____

3.Products with a high turnover and relatively low price, such as shampoo, sugar or salt. _____

4.Major household electrical goods which are usually white, such as freezers, washing machines and dishwashers. _____

5.Goods that last for a long time, such as cars, furniture and white goods. _____

6.Major household electrical goods that are not usually white, such as televisions, DVD players. _____

4. Translate the following sentences. Give their names:

81

1.Organic products, usually food, that will go bad after a certain amount of time.

2.Products sold in very large quantities, such as groceries. They are bought often and move through stores quickly.

3.A new product, especially in computer industry, which is almost the same as a successful one made by a more famous manufacturer.

4.Long-lasting products produced and sold in large quantities.

5.A basic product with additional features and services added to the total package.

6.A basic product which is bought because of a particular need, e.g. a drink for thirst.

7.Products which are not known by a brand name, e.g. pharmaceutical products like paracetamol for headaches.

8.Special expertise or advice to help companies or individuals in, e.g. legal matters, marketing.

9.A time suggested for reasons of safety by which perishable goods should be used.

10.The actual making of products or components for products.

11.Products which are hard to differentiate from other products of the same type. Consumers buy them just on price (for example, PCs)

5.Translate the following sentences into English.

1.Продукт – это товар, услуга или идея, состоящие из набора осязаемых и неосязаемых свойств, удовлетворяющих потребителей, и приобретаемые ими в обмен на деньги.

2.Товары можно классифицировать по степени их осязаемости и типа пользователя.

3.Осязаемые или материальные продукты делятся на товары кратковременного пользования, товары длительного пользования и услуги.

4.С точки зрения пользователя, существуют две основные группы товаров – потребительские товары и товары промышленного назначения.

5.Потребительские товары включают в себя товары повседневного спроса, товары предварительного выбора и товары особого спроса.

82

6.Товар-новинка должен значительно отличаться от уже существующих товаров.

7.Новые товары терпят неудачу по одной из семи причин:

-недостаточное отличительное преимущество;

-недостаточно чёткое определение целевого рынка;

-переоценка привлекательности рынка;

-неэффективная реализация комплекса маркетинга;

-низкий уровень качества товара по основным параметрам;

-неудачный выбор времени;

-недоступность для покупателя.

8.Многие товары почти не отличаются друг от друга по своим качествам и по внешнему виду. Такие товары, например, персональные компьютеры становятся товарами широкого потребления.

Text 2 Product life cycles

Read the text about the product life cycles and decide whether the statements given below are true or false. Say why.

The sales of most products change over time. The standard life cycle includes introduction, growth, maturity and decline stages.

The introduction stage, following a product’s launch, generally involves slow growth. Only a few innovative people will buy it. There are probably no profits at this stage because of the heavy advertising, distribution and sales promotion expenses involved in introducing a product into a market. Consumers must be made aware of the product’s existence and persuaded to buy it. Some producers will apply a marketskimming strategy, setting a high price in order to recover development costs. Others will employ a market-penetration strategy, selling a product at as low a price as possible, in order to attain a large market share.

During the growth period, ‘early adopters’ join the ‘innovators’ who were responsible for the first sales, so that sales rise quickly, producing profits. This generally enables the producer to benefit from economies of scale. Competitors will probably enter the market, usually making it necessary to reduce prices, but the competition will increase the market’s awareness and speed up the adoption process.

83

When the majority of potential buyers have tried or accepted a product, the market is saturated, and the product reaches its maturity stage. Sales will stabilize or will only increase if the population increases. The marketing manager has to turn consumers’ brand preference into brand loyalty.

Most products available at any given time are in the maturity stage of the life cycle. This stage may last many years, and contain many ups and downs due to the use of a succession of marketing strategies and tactics. Product managers can attempt to convert non-users into users, search for new markets and market segments to enter, or stimulate existing consumers to buy more. Alternatively, they can attempt to improve product quality and to add new features, sizes or models, or simply to introduce periodic stylistic modifications. They can also modify other elements of the marketing mix: cut prices, increase advertising, undertake aggressive sales promotions, seek new distribution channels, etc.

A product enters the decline period when it begins to be replaced by new products due to advances in technology, or to changes in fashions and tastes. When a product has clearly entered its decline stage, some manufacturers will abandon it in order to invest their resources in more profitable or innovative products. When some competitors withdraw from the market, those who remain gain a temporary increase in sales as customers switch to their product.

Not all products have this typical life cycle. Some have an immediate rapid growth rather than a slow introductory stage. Others never achieve the desired sales, and go straight from introduction to maturity. Fads and gimmicks – toys people buy once and once only to stick on car windows – have distinct life cycles, both rising and declining very quickly.

Comprehension / interpretation

Agree or disagree with the statements, prove your point with arguments from the text.

1.The introduction stage of a new product is not usually profitable.

2.During the introduction stage, marketers are trying to create brand preference.

3.A producer, seeking maximum profits will apply a market-penetration strategy.

4.The entry of competitors onto the market will make more consumers aware of the product and stimulate them to try it.

5.At the maturity stage, producers begin to benefit from economies of scale.

6.The maturity stage is generally the longest.

84

7.Once the maturity stage is reached, marketers concentrate on finding new customers.

8.A product enters the decline stage when it begins to become obsolete or old fashioned.

9.A product can experience temporary sales increases during the decline stage.

10.Gimmicks and fads have a particularly long life cycle.

Language focus

1.Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

2.Time sequences.

The expressions below can be used to describe sequences of actions taking place over extended periods of time. Read and translate them.

3.Read the text again and complete the sentences choosing expressions from the list above to begin the following sentences.

1.….. companies have to advertise and promote heavily.

2.….. companies have to choose between high profit and high market share strategies.

3.….. competitors will probably enter the market.

4.….. economies of scale begin to lower costs.

5.….. growth is slow and expenses are high.

6.….. marketers have to build up brand loyalty.

7.….. marketers have to turn the awareness of the product into a desire to purchase the product.

8. ..... new products will appear and begin to replace the existing ones.

9.….. sales begin to rise quickly.

10.….. sales will only increase if marketers can expand the whole market, or find new uses or users for the product.

11.….. the company will choose to abandon the product.

12.….. the market will become saturated.

4. Fill in the missing prepositions in the sentences. Choose from the following:

1.Perishable goods go ….. in a short time.

2.If dairy products are not sold ….. the sell-by-date, they cannot be offered for sale.

3.Unsold perishable goods usually have to be thrown …… .

4.If a safety fault is discovered in an electrical product, the manufacturer has to take ….. all faulty examples of the product.

5.Thousands of new products are put ….. the market every day, but only a few are successful.

6.Success or failure depends ….. many factors, but the most important id the quality of the marketing.

86

7.Customers with a strong sense of brand loyalty are rarely prepared to switch ….. a new competitor.

8.Powerful advertising may help a new product to eat ….. the market share of rival brands.

5.Complete the sentences with the words given below. Translate them into Russian. Change the form of the verbs if necessary.

1.Many companies have a ……. consisting of a number of products.

2.These products can have growing, stable, or declining sales, depending on where they are in their ……. .

3.Companies ……. high market share generally have long product lines, while companies seeking high profitability will have shorter lines.

4.Yet most product lines tend to ……. over time, as companies add extra items to cover more market segments.

5.Line-filling can lead to ……., if the items are too similar.

6.A product line can be ……. in two directions, both up-market and downmarket, although going down-market can ……. a company’s image.

7.Companies also occasionally shorten or ……. their product lines.

8.Sometimes you can increase profits by refusing from or ……. certain items.

9.Adding items to a product line results in a variety of costs; e.g. you will need to carry more ……. .

10.On the contrary, producing fewer items generates ……. .

6.Translate the following text into English using words and word partnerships given above.

1.Большинство компаний регулярно выпускают на рынок новые товары, расширяя и насыщая свои товарные линии. Таким образом, они пытаются найти возможности увеличить продажи и получить большую прибыль.

2.Но новые товары не всегда оказываются успешными и прибыльными. Поэтому компании приходится регулярно проводить анализ издержек и

87

продаж всей торговой линии, избавляясь при этом от убыточных товаров

(unsalable products).

3.Безусловно, управляющим по торговой марке не очень приятно видеть, что их товары уничтожаются, но компания не может существовать без прибыли.

4.Если продажи товаров, которые были успешными, сократились, компании необходимо думать о будущем. Она вынуждена отказываться от старых товаров с тем, чтобы освободить место новым (make room for).

5.Иногда только 20% от всех товаров фирмы составляют большую часть всех продаж. Таким образом, большинство товаров оказываются убыточными и от них могут отказаться.

6.Менеджеры компании, возможно, не будут сдаваться без боя (give up without a fight), но у них часто нет другого выхода, кроме как подчиниться

(obey).

7.С другой стороны, выходить на рынок с новым товаром иногда гораздо сложнее, чем продолжать продавать товары, не приносящие дохода.

Read the text and speak on the statements given below.

Most companies decide to brand their products or services by using a name, a symbol or a design to identify it and differentiate it from rival brands. Consumers can easily recognize the brand and the brand values, i.e. what stands behind the brand.

A brand name is the name given to a product or a range of products – goods of a similar type that are marketed together. This may be the same name as the company (for example, Coca-Cola) or it may be a different name (for example, Apple’s iPod).

The trade mark is the legal protection for the brand, its logo and its brand name. People often wonder what makes a brand different from a product. In marketing

terms, products are not brands. Products are general, while brands are something quite unique. Brand identity consists of far more than the physical product itself. A brand includes some psychological features that we associate with it. Top brands form a personal relationship with consumers; they are able to make us feel more confident, more powerful, healthier and happier. Brands are promises and people buy what they believe in.

88

A brand has USPs, specific features which set it apart from its competitors. For example, Barbie was the first doll to look like a young woman, and a metal rivet was the unique feature of Levi jeans. Both brands have numerous imitators, but generally speaking, a ‘me-too’ product won’t achieve the success of the one it follows.

People who say you don’t need to worry about your competitors couldn’t be more wrong. Competent managers have to know how to position their brand in relation to the competition, in terms of factors like price and quality of the product. Managers should relate the brand’s values to the consumers they have targeted. With worldwide brands this may mean changing your message from country to country, or even within one market. Coca-Cola produces a version for Japan which is sweeter than the one sold in the US. The Japanese prefer beef with a higher fat content, so McDonald’s naturally obliges. Ronald McDonald’s name was even changed to Donald because the

Japanese have trouble saying ‘r’.

The product life cycle is a familiar one in marketing. A product is launched, developed, goes through a period of growth, enters maturity, declines, and eventually dies. A top brand should go on and on if it is well managed. A brand manager is like a doctor or plastic surgeon, who can keep the brand healthy and looking fresh down the years. Brand managers must be able to identify new segments of the market, particularly when products have become mature. Coca-Cola has introduced a large number of variants to appeal to different consumers. So knowing what stage your branded product is at in this cycle may help you decide when to extend a product line or improve the product, i.e. add some new values. Newer versions of cars, for instance, will come with air-conditioning as a standard feature, or they have a facelift to modernize the look even though what is under the bonnet may stay the same.

Comprehension / interpretation

Read the text again and decide if these statements are true or false.

1.Brand is just another word for product.

2.Brands promise us happiness, health, good reputation and status.

3.USPs are not so important as people believe.

4.It’s better to be first in the market with a new idea.

5.People worry too much about competition.

6.Global brands may need to ‘think local’.

7.There is little you can do to keep a brand alive.

8.Some changes to products are simply cosmetic.

89

Language focus

1.Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

2.Word combinations with ‘brand’. Match the terms with their definitions. Translate into Russian.

1.Two brands working together to create a new product – for example, Intel Corporation and Apple Computers Inc. _____

2.A high quality brand, more expensive than its competitors. _____

3.How the consumers see the brand, the values they associate with it. _____

4.A product that doesn’t have a brand associated with it; also known as a generic brand. _____

5.Increasing the number of consumers who know about your brand. _____

6.Increasing the number of consumers who prefer the brand over another. ___

91

Caferoma, is a well-known brand of coffee, is owned by the Pan European Food and Drink Company (PEFD), based in Turin, Italy. It is promoted as an exclusive ground coffee for gourmets. Its image is that of an Italian-style coffee. It has a strong fullbodied flavor and a slightly bitter taste. It costs more per 100 grams than almost every other ground coffee product on the supermarket shelves.

Problems

In the last two years, Caferoma’s share of the European quality ground coffee market has declined by almost 25%. There are several reasons for this:

Brand loyalty: Consumers have become less loyal to brands and are more willing to trade down to lower-priced coffee products.

‘Copycat’ products: Competing brands of Italian-style ground coffee at prices 30% to

40% lower than Caferoma’s price have cut into Caferoma’s market share.

Brand image: Consumer surveys show that the Caferoma brand no longer has a feeling of excitement and enthusiasm, and that it does not give the impression of being up-to-date and contemporary.

Task

You are members of PEFD’s European marketing team. Hold an informal meeting to discuss Caferoma’s problems. Decide what actions are necessary to take to stop the decline of the product’s market share and to increase profit.

Possible solutions

Repositioning the product: Change Caferoma’s image to appeal to a different market segment. What segment, and what changes should be made to taste, quality, packaging, logo, labeling, etc?

Pricing: Reduce the price by 20% or 30% to make it more competitive.

Advertising: Develop a new advertising campaign. (a new message, special promotion events).

Multiple brands: Sell Caferoma, with minor product changes, under different brand names at lower prices.

Own label products: Sell Caferoma coffee for supermarkets to package and sell under their own labels (but continue to market the Caferoma brand at the same time).

92

A new product: Bring out an instant coffee or decaffeinated product under the Caferoma brand.

Stretching the brand: Allow selected manufacturers of coffee equipment (cafeterias, percolators, coffee machines, etc.) to use the brand on their goods but for a licensing fee.

Unit 9

Pricing

Read the text about pricing strategies and answer the questions.

The price of a product should logically cover its production and distribution costs, including a proportion of the company’s fixed costs or overheads, such as rent and interest payments, and leave a small profit. But prices are also influenced by the level of demand, the prices of substitute products, and the prices charged by competitors.

High quality products made with expensive components and requiring a lot of craftsmanship are obviously expensive. They also generally require ‘prestige pricing’ as the consumers in their target market would not buy them if they thought the price was too low. The market for most other goods is generally price sensitive, i.e. the lower the price, the greater the sales.

But for new products for which there is a sufficiently high demand, companies may choose to set the highest possible price so as to maximize profits. This is known as market-skimming. The price can later be reduced in order to reach further market segments.

The opposite strategy is market-penetration, which means setting as low a price as possible so as to increase sales volume and market share. In its turn it causes lowering unit production and distribution costs and increasing long-run profit. The low price will also discourage competition.

Companies with overcapacity, intensive competition, a large inventory, or a declining market are likely to cut the prices of established products. They are more concerned with keeping the plant going and staying in business than making a current profit. On the contrary, firms facing rising costs, or in need of cash, in the short term, tend to raise prices. A company faced with demand that exceeds supply is also likely to raise its prices, like a monopolist.

93

Firms in perfectly competitive markets, or homogeneous-product markets, or small firms in an industry with a strong market leader, are likely to use going-rate prices, i.e. they will charge more or less the same price as everyone else, rather than set a price based on estimates of costs or projected demand.

All prices can be adapted. Most companies offer cash discounts to customers who pay immediately, and quantity discounts to buyers of large volumes. Many products and services are sold at a lower price during an off-season. Retailers often offer some loss-leader prices: they cut the prices of selected products to cost price or even below in order to attract customers who buy other goods. Companies also have to react to price changes by competitors. They might try to avoid a price war by modifying other elements of the marketing mix. Similarly, they have to anticipate competitors’ reaction if they change their own price.

Comprehension / Interpretation

1.What does the price of a product include?

2.What can influence the price?

3.Under what circumstances may companies choose a market-skimming strategy?

4.Under what circumstances may companies choose a market-penetration strategy?

5.What is the main reason for cutting prices?

6.What is the main reason for raising prices?

7.When do companies use going-rate pricing?

8.How can companies adapt their prices to the market?

Language focus

1.Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

95

b)ease of comparison

c)unique benefits

d)monetary significance

e)demand

f)price sensitivity

g)complementary costs

4. Complete the text using words given below. Translate the text into Russian.

When deciding on the price of a product or service you have to consider the product or service itself. For example, does it have (1) ….. benefits? Does the consumer have any alternative (2) ….. ? What is the monetary (3) ….. of the product or service? You also have to think about the possibility of complementary (4) ….., and how price (5) ….. the consumers are to these and the product or the service cost.

Then you need to think about the pricing strategy and how this relates to the brand. For a luxury brand it is essential to follow a (6) ….. pricing strategy in order to maintain the brand image. A low price would not be suitable for a brand.

Finally, you need to carry a price test to check the price (7) ….. you have to consider. The (8) ….. price is the amount that the consumer is prepared to pay for the product or service. A (9) ….. price is a low price that may be used during special offers or for promotional pricing.

5. Translate the following text into English.

Основой установления цены на товар служит уровень потребительского спроса на данный продукт. Поэтому маркетологу необходимо трансформировать оценку (estimate) величины (dimension) спроса в оценку уровня доходов, которые фирма надеется получить, продавая товары для удовлетворения этого спроса.

Кривая спроса (demand curve) показывает, какое максимальное количество товаров купят потребители по данной цене. По мере снижения цены люди покупают больше товаров. Однако не только цена влияет на спрос. Экономисты выделяют три других ключевых фактора:

1.Вкусы потребителей. Вкусы потребителей зависят от многих факторов, таких как демографические характеристики, культурное окружение, уровень технологий. Поскольку вкусы потребителей меняются достаточно

96

быстро, очень важно своевременно проводить маркетинговые исследования.

2.Цена и доступность других товаров. По мере (as) снижения цены на товары-заменители спрос на данный товар падает.

3.Доходы потребителей. Как правило, по мере роста реального потребительского дохода растёт и спрос на товар.

Первые два фактора влияют на готовность потребителя купить товар, а третий – на его способность купить товар. Наряду с (along with) ценой эти факторы называют факторами спроса или факторами, которые определяют готовность и способность потребителя платить за товары и услуги.

Marketing practice:

Read the information about upmarket and downmarket, mass markets and niches and translate it, paying special attention to the words in bold.

Products exist in different models. Take skis for example. Some skis are basic and others are more sophisticated and exclusive. The cheapest skis are low-end or bottom-end. The most expensive ones are high-end, top-end or premium products – designed for very experienced users (or people with a lot of money). The cheapest entry level skis are intended for beginners who have never bought skis before. Those in-between are mid-range. When you buy more sophisticated skis to replace basic ones, you trade up and move upmarket. If you buy cheaper skis after buying more expensive ones, you trade down and move downmarket.

To say that something is downmarket often shows disapproval. For example, if a publisher takes a newspaper downmarket, they make it more popular, less cultural, etc. in an attempt to increase the number of readers.

Mass markets and niches

Mass market is used to talk about goods that are sold in large quantities and the people who buy them, for example family cars. A niche is a group of buyers with specific requirements that is relatively small but that may be profitable for companies that sell to it, for example sports cars.

Read the article and answer the questions. Look at the information about markets given above to help you. Analyze the situation with Starbucks.

97

Starbucks in trouble

From the beginning, the key to Starbucks’ success was its upmarket image. That the coffee itself was rather expensive only added to its appeal. If you wanted cheap coffee, then go to a diner. For a long while Starbucks managed to keep ahead of the competition, expanding very fast, buying competitors and launching new products.

Premium coffee remained the basic product – and the product other companies could easily copy. Now McDonald’s offers premium coffee, not only cheaper than

Starbucks’ but of a quality that won first place in a survey conducted by Consumer

Report.

As a result, Starbucks finds itself caught in a new, unwelcome ‘third place’, pressed from below by the fast-food chains that until recently had been considered more downmarket, and from above by a new generation of more upmarket, exclusive and sophisticated coffee houses.

1.What sort of image did Starbucks have when it was launched?

2.Was the fact that it was expensive a problem?

3.Did Starbucks grow just by opening new coffee shops?

4.How has McDonald’s coffee changed in the last few years?

5.Is Starbucks in a good competitive position? Why? Why not?

6.How should Starbucks act to increase its coffee sales and retain its leading position on the market?

Case study: Dilemma and decision

Many producers of the branded goods refuse to distribute through supermarket chains, fearing that price-cutting could damage their brand image. They distribute exclusively through selected retailers. Grey marketers challenge this by obtaining branded goods through alternative supply routes and selling them at much cheaper prices.

Best Value is a leading UK supermarket chain that has been offered a ‘grey consignment’ of genuine branded jeans at a very heavily discounted price. The brand owner, GenX, is aware of the situation and has threatened legal action if Best Value sells the jeans. Best Value could sell a lot of jeans and even the legal threats from GenX could generate positive publicity. However, losing a major legal battle could be costly and sales of Best Value’s own brand of jeans could suffer.

98

Task

Look at the situation and list the advantages and disadvantages of accepting the consignment of GenX 250 jeans.

Discuss the best course of action to take. Possible options include:

1.Refuse the GenX 250 jeans.

2.Sell the jeans but hope to get GenX’s permission by negotiating an acceptably high retail selling price.

3.Accept the shipment and sell the jeans at the heavily discounted price risking legal action from the brand owner.

Unit 10

Placing

Read the text about placing goods and services and answer the questions.

Placing, an important element of marketing mix, involves getting the product from its original source to the end user. The supply chain describes the suppliers, storage facilities, retailers and models of transport which are involved in distributing the product or service to the consumer.

There are three distribution systems: conventional marketing system (CMS), vertical marketing system (VMS) and total system approach (TSA).

Conventional marketing system – traditionally there used to be a line consisting of independent producers, wholesalers and retailers. Each was a separate business.

Vertical marketing system – many businesses work together in a unified system where producers, wholesalers and retailers act together. They may be under common ownership, or they have contracted to work together as a single system.

Total system approach – a new trend, a distribution system which is designed to accommodate consumer needs at minimum cost, and places every step of the distribution channel under a single control.

There can be two types of distribution: direct distribution and indirect distribution. Direct distribution allows the company to eliminate wholesalers and sell directly to

the consumer. Direct distribution helps the company to keep track of inventory as well as distribution costs. Besides, the company can eliminate retailers, people, shops or businesses that sell to the public, and receive orders from customers directly.

99

Indirect distribution channel is a system where a person or organization helps a company to arrange agreements or business deals between other people or organizations. Such people or organizations are called intermediaries or middlemen.

One of the criteria for a successful supply chain is time management. All the participants of a supply chain agree when a particular process should be completed. It is important to keep to this deadline or there will be delays in other parts of the supply chain. In some cultures, people see time / appointments / deadlines as flexible; in other cultures, it is important to always be punctual. This can be an intercultural problem.

Comprehension / interpretation

1.What does placing involve?

2.What does supply chain involve?

3.What does conventional marketing system consist of?

4.How does vertical marketing system work?

5.What differentiates total system approach from conventional marketing system?

6.What is the difference between direct distribution and indirect distribution?

7.What people are called intermediaries?

8.What are the main criteria for a successful supply chain?

Language focus

1. Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

завершить процесс; придерживаться сроков; задержка.

100

2. Replace the words in bold in the fax below with a word with the same meaning given below. Translate the fax.

To: Sara Alessi

From: Alain Booster

Subject: Distribution system

As the (1) manufacturer, we obviously must ensure that products reach (2) customers with maximum efficiency. Now, we use independent (3) distributors, but we should consider better alternatives. The following changes need urgent consideration:

Cutting out (4) intermediaries – this would bring cost savings.

Larger (5) sales teams.

Many more (6) reps.

Improved (7) shipment system.

Closer relationships with (8) dealers.

More links with (9) chains. Call to discuss.

Regards, Alain

3. Fill in the missing words in sentences below. Choose from the following:

1.An agent who receives a percentage of the sales is ____ .

2.An agreement to sell only one manufacturer’s goods is called a sole ____ .

3.All the people involved in selling a company’s goods or services are the ___ .

4.A place where ships are loaded with special metal boxes full of goods is called a ___ .

5.____ s buy from companies and sell to retailers.

6.Trading through computers, with orders and payment transmitted along telephone network, is called ____ .

101

7.The amount of space given over in a shop for displaying a particular product is called ____ .

8.An agreement to pay a license fee to use a well-known name is called a ___ .

9.A machine in which you put coins to buy confectionery or other small items is called ____ .

10.A company that owns a lot of ships is called ____ .

4.Read the terms and their definitions. The general term of a market of goods is a shop (BrE) or store (AmE) or a retail outlet or sales outlet.

Here are some types of shops:

1.Chain store – a shop that is part of a group of shops, all with the same name.

2.Convenience store – a shop in a town that is open long hours.

3.Discounter – a wholesaler or retailer with very low prices.

4.Department store – a very large shop, usually in a town centre.

5.Hypermarket – a very large shop with a wide variety of goods, usually outside a town; its assortment involves food products (40%) and goods of scrambled assortment (60%) (товары смешанного ассортимента)

6.Supermarket – a very large shop, selling mainly food.

7.Specialty store – a shop that sells unusual products or food that are special in some way.

5.Look at the previous exercise and say where you go if you want to:

1)park easily and make purchases of different goods including grocery products and industrial goods all in one shop without having to go to the town centre.

2)visit different shops grouped together in a town centre.

3)buy a packet of sugar if all the supermarkets are closed.

4)buy a particular product with unique characteristics.

5)buy food and some other products extremely cheaply.

6)buy clothes in a town centre without going to a specialized clothes shop.

7)buy different kinds of food and some other goods used especially in the home.

102

6. Put the steps in the distribution chain in the correct order. Translate them.

1.The goods arrive and can be sold to the consumer.

2.The franchise sends the order to the warehouse in South America.

3.Road transportation is used to ship the goods from Southampton to Brighton.

4.The goods land in Southampton.

5.The container ship is loaded with the parts.

6.A franchisee in Brighton places an order for car accessories.

7.Read the text about franchising and translate it into Russian.

Franchises are owned by franchisees – the people that run them – but they only sell the goods of a particular company. The franchisor – the company – provides the goods and organizes advertising centrally and in return takes a percentage of the profits of each franchisee. Other types of business, such as restaurants, can also be run in this way.

8. Translate the following text into English.

Франчайзинговые организации – это один из наиболее распространённых типов контрактной вертикальной маркетинговой структуры.

В системе франчайзинга, отдельное лицо или фирма (получатель или держатель франшизы) заключает соглашение с материнской компанией (владельцем франшизы) о создании коммерческого предприятия или розничной торговой точки.

Владелец франшизы обычно помогает её получателю в выборе места для магазина и в его оборудовании, в проведении рекламы и обучении персонала. Держатель франшизы платит единовременный франчайзинговый взнос (one-time initial fee) и ежегодные отчисления (monthly fees) , размер которых обычно определяется объёмом продаж магазина.

Для новых предпринимателей франчайзинг привлекателен тем, что он даёт возможность присоединиться к известному устойчивому бизнесу и получить консультации по вопросам управления. К тому же, франчайзинговый взнос может оказаться меньше суммы, необходимой для создания собственного независимого предприятия.

103

Продавая франшизы, материнская компания (holding company) снижает издержки на расширение деятельности, но при этом теряет часть контроля над предприятием.

Однако опытный владелец франшизы всё же способен осуществлять эффективный контроль над работой франшизодержателей.

Unit 11

Promotion

Read the text about four promotional tools and answer the questions.

Marketing is often defined as a matter of identifying consumer needs and developing the goods and services that satisfy them. This involves developing the right product, pricing it attractively, and making it available to the target consumer, by persuading distributors and retailers to stock it. But it is also necessary to inform potential consumers of the product existence, its features, its advantages, and to persuade them to try it.

Marketers conventionally distinguish four basic promotional tools: advertising, sales promotion, public relations, and personal selling, which together make up the marketing communications mix.

Advertising is an important marketing tool which works in a number of different ways. Advertising can inform or persuade or remind or motivate.

If a company wants to make a customer aware of a product or service, or build the image of a brand, it usually contacts an advertising agency. It is the role of an ad agency to develop an advertising strategy. The advertising strategy defines the advertising message – what is to be communicated – and the choice of media. Media planners determine the media strategy and identify appropriate channels to reach the target audience and media vehicles (for example, types of press magazines, TV channels, poster networks).

Companies can choose from different advertising formats. An advertisement that is broadcast on TV or radio is called a commercial. Interactive ads are becoming more popular on digital television. In addition to using the remote control to change channels, viewers can press a button and respond to an ad.

Outdoor advertising or out-of-home advertising can grab our attention. Traditional billboards and digital video billboards, giant banners which are hung on the front of buildings, bus shelters, floor graphics in supermarkets and shopping centres have become common things in our life.

104

Marketing has relied on word of mouth (WOM) for a long time – happy consumers have always told their friends and relatives about the products they like. Favorable word of mouth publicity is highly beneficial for companies and brands. Advertisements where famous people recommend the product are product endorsements. However, the product or service must not disappoint the target audience, it must meet their expectations.

Different activities designed to support the sale of goods and services, including advertising are called sales promotion. Sales promotion includes special offers such as discounts or special price; free samples – a small amount of the product to try or taste; a free gift which is given with the product; a competition with prizes – a winner is given a prize. Supermarkets, chain stores and airlines also offer loyalty cards – the more you spend, the more points you get, and you can exchange these points for free goods or flights.

A cross promotion is where you buy one product, and you are recommended to buy another product, for example a washing machine with a recommendation for a particular brand of washing powder.

Public relations involve establishing and maintaining goodwill (a good reputation) and understanding between an organization and its public. Companies can use public relations firms and their experts to promote their goods and services through organizing different public events, trade fairs and exhibitions.

Personal selling, or selling to a customer face-to-face, is different from impersonal selling such as advertising and sales promotion. Salespeople can inform customers and demonstrate technical products, at the same time customizing the sales messages to what that specific customer needs to hear.

Salespeople prospect or look for new clients, calling potential customers from a cold list. A cold list is a list of people who have had no prior contact with the company. Calling the people on the list for the first time is known as cold calling. Common reasons for cold calling include:

contacting cold prospects (people who don’t yet have a relationship with the company) to create hot contacts (people who are ready to buy)

selling services over the telephone

making an appointment for a sales rep to meet the prospect

closing deals – customers are ready to buy and salespeople try to close the deal by asking the customer to place an order. They may offer trade concessions or negotiate.

105

following-up – follow up calls are part of the after-sales service which enables salespeople to check customer satisfaction with the service or product – how happy they are with it. Satisfied customers will purchase again, generating repeat business.

Comprehension / interpretation

1.What are four basic promotional tools?

2.What is the main role of advertising?

3.What does the advertising strategy define?

4.What media channels can be used to reach a target audience?

5.What is a commercial? Is it a reliable advertising tool?

6.What type of advertising is considered to be the most reliable?

7.What specific offers does the sales promotion include?

8.What do we mean under public relations? Why is it important for a company to be involved in establishing good relationships with the public?

9.What steps should salespeople take to persuade potential customers to buy their product?

10.What is cold calling? What are the reasons for cold calling?

Language focus

1.Look through the text and find words and word partnerships corresponding to the words and word partnerships given below.

2.Read the extract of an internal report to senior marketers in the company. Fill in the missing words and phrases in the report given below.

Advertising plan

Our plan is to sell products through a (1) ____ and mail order service. We will use a high pressure, (2) ____ approach. We can attract customers to order the goods by offering special (3) ____ prizes. Once the catalogue arrives, consumers will order goods which have an instant appeal: we will depend on

(4) ____.

Another approach is to run a long advertising (5) ____ to increase (6) ____ of our products. We plan a variety of advertising techniques: this (7) ____will consist of television (8) ____, newspaper (9) ____, and street advertising. We have a good target customer database, so we will use (10) ____ . We plan to do a (11) ____ twice, to put extra pressure on those who do not answer the first time.

107

3.Match each definition to the appropriate type of promotion. Translate the sentences.

customer-oriented selling

1.A promotion method for fast-moving-consumer-goods which involves buying one and getting one free is called ____ .

2.Advertising around the playing area at sports grounds is called ____ .

3.A promotion method that involves the packaging of a product, such as including a free sample or coupons is called ____ .

4.A promotion based on advertising in the actual shop is an ____ .

5.A selling technique based on making a personal call to an individual or company is called ____ .

6.Selling product or service information by post to specific individuals or companies is called ____ .

7.A selling style based on identifying and meeting the customer’s needs is called ____ .

8.A sales-oriented selling style, using high pressure and persuasion, discounts and free services is called ____ .

4.Which of the following statements do you agree with? While answering use some of the words characterizing advertisements.

1.People remember advertisements not products.

2.Advertising raises prices.

3.Advertising has a bad influence on children.

5.Translate the following text into English.

Выбор целевой аудитории

Первый шаг в разработке рекламной программы – это выбор целевой аудитории, т.е. группы потенциальных покупателей, на которых будет направлена рекламная программа.

108

Выбор целевой аудитории определяет все аспекты рекламной программы: содержание рекламы, средства её распространения, частота показа, время показа.

Компания «Nestle», например, при подготовке рекламной кампании бульонных кубиков “Maggi” выяснила, что целевая аудитория для этого продукта в России отличается от европейской. Если в Европе целевой аудиторией являлись холостяки (которые в основном питаются вне дома, но по случаю решили сами приготовить суп), то в России целевой аудиторией являются домохозяйки, которые готовят обед для своей семьи.

Поэтому в рекламных роликах, демонстрируемых по российскому телевидению, шеф-повар, дающий рекомендации неопытным кулинарам (с кубиками “Maggi” вы сами сможете приготовить суп как в ресторане), был заменён домашней хозяйкой (с кубиками “Maggi” почувствуйте вкус

ктворчеству).

Показываются эти рекламные ролики во время сериалов или вечерних

программ, когда у телевизора собирается вся семья.

6.Aims of street marketing. Marketing managers choose the form of direct marketing for various reasons. Read the reasons and translate them into Russian:

1)to build awareness, or knowledge, of a product among a specific group of people – for example, men aged 20-35;

2)to increase the purchase consideration (get consumers to consider buying a product);

3)to create a buzz so that the target start to talk about the brand;

4)to establish a dialogue with potential consumers (start talking and listening to people’s opinions about the brand);

5)to build the credibility of a brand by convincing influential and trusted peer members – people of the same age or with the same interests – to use the brand.

7. Read the information about the product launch and select two objectives that best describe the campaign. Say what you think about the efficiency of the campaign. Look at the exercise above to help you.

109

We launched a street marketing campaign to reach the elusive youth market. The campaign targeted 18 to 25-year-old customers at home, at work, in the street. The goal was to create a fun environment where trendsetters and influencers could talk about and taste the new products.

Street marketing was used to create a buzz about our new range of energy drinks. A bus, decorated in the logos and colours of the brand, travelled along the streets communicating brand messages. We distributed samples in night clubs, in fashionable bars and in stylish locations in the city.

Case study: Focus advertising

Read the case, prepare and present your advertising campaign.

Background

Focus, a large advertising agency, based in Paris, has a reputation for creating imaginative and creative campaigns. Recently, however, Focus’s reputation was damaged when two major clients changed to rival agencies. Focus now needs to convince potential clients that it still has plenty of creative ideas to offer.

At present, Focus is competing against some well-known agencies for several contracts. It has been asked to present ideas for advertising campaigns to the managements of the companies concerned.

Concepts required for the following campaigns are:

A sports car A high-priced, hand-finished model with a classic design. The car was popular in the 1950s and 1960s. An American firm now wants to re-launch it. Target consumers will be high-income executives with a sense of fun and style.

Aim: An international campaign, with advertising adapted to local markets.

A perfume A perfume for young women, with bio-degradable packaging. Produced by a well-known up-market manufacturer. The company now wishes to enter the lower end of the market.

Aim: Reach new consumers, expand the market share.

110

A chain of restaurants The restaurants (specializing in your national cuisine) are in prime position and offer extensive menus. They are reasonably priced, but are not attracting enough customers.

Aim: A creative campaign to improve sales.

A major bank: The bank wants to advertise the following new services:

1.Competitive low-interest mortgages

2.Direct telephone banking services

3.A foreign travel service

(The agency is allowed to suggest any other attractive services.) Aim: Develop loyalty among existing customers and attract new ones.

Task: You are members of advertising teams at Focus. Prepare an advertising campaign for one of the products or services. Use the key questions below to help you.

Key questions:

1.What is campaign’s key message?

2.What special features does the product or service have?

3.What are its USPs (Unique Selling Points)?

4.Who is your target audience?

5.What media will you use? Several, or just one, or two? If you use :

an advertisement – write the text and do rough art work;

a TV commercial – use a story board to illustrate your idea;

a radio spot – write the script, including sound effects and music; other media – indicate what pictures, text, slogans, etc. will be used.

6.What special promotions will you use at the start of the campaign?