1. Conversional marketing is the difficult task of reversing negative demand, e.g. for dental work, or hiring disabled people.
2. Stimulational marketing is necessary where there’s no demand, which often happens with new products and services.
3. Developmental marketing involves developing a product or service for which there is clearly a latent demand, e.g. a non-polluting and fuel-efficient car.
4. Remarketing involves revitalizing falling demand, e.g. for churches, inner city areas, or ageing film stars.
5. Synchromarketing involves altering the time pattern of irregular demand, e.g. for public transport between rush hours, or for ski resorts in the summer.
6. Maintenance marketing is a matter of retaining a current (maybe full) level of demand in the face of competition or changing tastes.
7. Demarketing is the attempt (by governments rather than private businesses) to reduce overfull demand, permanently or temporarily.
8. Countermarketing is the attempt to destroy unwholesome demand for products that are considered undesirable, e.g. cigarettes, drugs, handguns, or extremist political parties.
2. Match up these actions with the eight tasks described above:
1.Alter the pattern of demand through flexible pricing, promotion, and other incentives.
2.Connect the benefits of the product with people’s needs and interests.
3.Find new target markets, change product features, develop more effective communication.
4.Find out why people dislike the product, and redesign it, lower prices, and use more positive promotion.
5.Increase prices, reduce availability, make people scared.
6.Keep up or improve quality and continually measure consumer satisfaction.
7.Measure the size of the potential market and develop the goods and services that will satisfy it.
8.Raise prices, reduce promotion and the level of service.
3. Fill in the gap with the suitable word:
1. … is reducing excess demand by temporarily or permanently discouraging certain customers.
a) remarketing b) demarketing c) countermarketing
2. The transformation of latent demand into actual demand, when a product or service first appears.
a) developmental marketing b) conversional marketing c) stimulational marketing
3. The attempt to destroy demand for something considered to be harmful is called unselling or … .
a) demarketing b) remarketing c) countermarketing
4. Converting people’s attitudes so that they buy something they previously disliked is called ….
a) conversional marketing b) syncromarketing c) maintenance marketing
5. Marketing an existing good or service for which demand has declined.
a) remarketing b) countermarketing c) demarketing
6. The attempt to alter the timing of demand is called … .
a) maintenance marketing b) syncromarketing c) remarketing
7. Creating demand for products or services about which consumers are uninterested or indifferent.
a) stimulational marketing b) synchromarketing c) maintenance marketing
8. The attempt to keep up full demand is … .
a) economies of scale b) the theory of supply c) maintenance marketing
1. Scan through the text. Work in pairs to question the text and to give answers.
MARKETING AND ITS FUNCTIONS (I)
Marketing is the ability to assess the needs of the consumer, then using the available resources, design, produce, advertise, and deliver the goods at the right time and at the right place and price to the customer. Marketing’s principal function is to promote and facilitate exchange. Through marketing, individuals and groups obtain what they need and want by exchanging products and services with other parties. Such a process can occur only when there are at least two parties, each of whom has something to offer. In addition, exchange cannot occur unless the parties are able to communicate about what they offer and to deliver what they offer. Marketing is not a coercive (ïðèíóäèòåëüíûé) process: all parties must be free to accept or reject what others are offering. So, marketing is distinguished from other ways of obtaining desired goods, such as through self-production, begging, theft, or force. Marketing is not confined to any particular type of economy, because goods must be exchanged and therefore marketed in all economies and societies except perhaps in the most primitive one. Furthermore, marketing is not a function that is limited to profit-oriented business; even such institutions as hospitals, schools, and museums engage in some forms of marketing.
3. Agree or disagree with the following statements:
1.Marketing is the sum of activities involved in directing the flow of goods and services from producers to consumers.
2.Marketing is the activity of trying to sell a company’s products by advertising, using attractive packages etc.
3.Marketing helps exchange to develop and be successful.
4.Marketing is to facilitate exchange.
5.Through marketing, individuals obtain needless and unwanted products.
8.Museums do not take part in some forms of international marketing.
9.Hospitals become involved in some forms of marketing.
4. Complete the following statements. Choose one topic to speak about a) what marketing is; b) marketing’s principal function; c) whether marketing is a coercive process; d) marketing and other ways of obtaining goods. Retell the text ‘Marketing and its functions’.
1) Marketing is ... 2) Marketing’s principal function is ... 3) Through marketing, individuals obtain ... 4) Exchange of products and services can occur ... 5) Exchange of products and services cannot occur ... 6) Marketing is not ... 7) Marketing is distinguished from ... 8) Marketing is not confined to ... 9) Marketing is not a function ... 10) Hospitals, schools, and museums engage in ...
1. Scan through the text.
MARKETING AND ITS FUNCTIONS (II)
Product / Service Management: Product / service management is obtaining, developing, maintaining, and improving a product or a product mix in response to market opportunities. Marketing research guides product / service management toward what the consumer needs and wants.
Pricing: Pricing decisions dictate how much to charge for goods and services in order to make a profit. Pricing decisions are based on costs and on what competitors charge for the same product or service. To determine a price, marketers must also determine how much customers are willing to pay.
Promotion: Promotion is the effort to inform, persuade, or remind potential customers about a business’s products or services. Television and radio commercials are forms of promotion. This type of promotion is called advertising. Promotion is also used to improve a company’s public image. A company can show that it is socially responsible by recycling materials or cleaning up the environment. Promotion concepts and strategies are used to achieve success in the marketplace.
Exchange Functions – Buying and Selling: All companies such as manufacturers, wholesalers, and retailers buy and sell to market their merchandise.
Buying includes such functions as obtaining raw materials to make products, knowing how much merchandise to keep on hand, and selecting suppliers.
Selling creates possession utility by transferring the title of a product from seller to customer. Selling provides customers with the goods and services they want. This includes selling in the retail market to you, the customer, and selling in the business-to-business market to wholesalers, retailers, or manufacturers. Selling techniques and activities include determining client needs and wants and responding through planned, personalized communication. The selling process influences purchasing decisions and enhances future business opportunities.
Physical Distribution Functions: Distribution is the process of deciding how to get goods in customers’ hands. These functions involve the flow of goods from producers to customers. Physically moving and storing goods is part of distribution planning. Transportation and storage provide time utility, and place utility, and require careful management of inventory. The main methods of transportation are by truck, rail, ship, or air. Some large retail chains store products in central warehouses for later distribution. Distribution also involves the systems that track products so that they can be located at any time.
Transporting involves selecting of transport that provides an acceptable deliveryschedule at an acceptable price. Storing goods is often necessary to sell them at the best selling time.
Facilitating Functions: These functions help the other functions take place.
Financing is getting the money that is necessary to pay for setting up and running a business. Financing helps at all stages of marketing. Business owners often obtain bank loans to start a new business. Some also form corporations and may sell shares (or stock) of the business. To buy raw materials, manufacturers often borrow from banks or receive credit from suppliers. Wholesalers may be financed by manufacturers, and retailers may receive financing from the wholesaler or manufacturer. Finally, retailers often provide financing to customers. Financing also involves decisions such as whether to offer credit to customers.
Standardizing sets uniform specifications for products or services. Grading classifiers products by size and quality, usually through a sorting process. Together, standardization and grading facilitate production, transportation, storage and selling.
Risk taking - even though competent management and insurance can minimize risks - is a constant reality of marketing because of such losses as bad debt expense, obsolescence of products, theft by employees, and product-liabilitylawsuits.
Marketing Information Management: Gathering market information is necessary for making all marketing decisions. Good business and marketing decisions rely on good information about customers, trends, and competing products. Gathering this information, storing it, and analyzing it are all part of marketing information management. Collecting information is done on a continual basis and through special marketing research studies. This is what marketers do to find out about customers, their habits and attitudes, where they live, and trends in the marketplace. Have you ever been asked to complete a questionnaire about the service at a restaurant or other type of business? If so, you have participated in marketing research. Companies conduct research so they can be successful at marketing and selling their products.
Customer Relationship Management (CRM): In today’s marketplace, customer relationship is most important. Customer relationship management (CRM) is an aspect of marketing that combines customer information (through database and computer technology) with customer service and marketing communications. Marketers who specialize in CRM try to create more meaningful one-on-one communications with the customer by applying customer data (demographic, industry, buying history, etc.) to every communication.
3. Find among the underlined in the text words those meaning the following:
1.an action or activity in which someone takes risks to achieve a benefit
2.the process of bringing goods to a place
3.separating things into different groups according to quality, size, importance etc
4.moving things from one place to another, usually in a vehicle
5.legal responsibility for causing damage or injury, or for paying something
6.goods that people buy and sell
7.an amount of money that you owe
8.the state of becoming old-fashioned and no longer used, especially because of being replaced by something newer and more effective
9.paying for something such as a large project
10.a case that a court of law is asked to decide involving a disagreement between two people or organizations
11.a plan of activities or events and when they will happen
12.an arrangement in which you regularly pay a company an amount of money so that they will give you money if something you own is damaged, lost, or stolen
13.making all the things of a particular type have the same features or level of quality
14.money that a person, company, organization etc loses when it spends more than it earns
15.the crime of stealing
16.the act of storing something
4. Questions and assignments:
1.What is the purpose of product / service management?
2.Define the main idea of pricing.
3.What is promotion used for?
4.Name the two main exchange functions.
5.What does buying include?
6.Name the two main physical distribution functions.
7.Why is storing goods necessary?
8.Name the main facilitating functions.
9.Speak on the role of financing in marketing.
10.Why is risk taking a constant reality of marketing?
11.Why is gathering market information necessary?
12.Why is customer relationship management important?
5. Make a list of key words of each paragraph. Try to retell each paragraph using this list of key words.
MARKETING ENVIRONMENT (I)
A marketing orientated company has to link the resources of the organization to the requirements of customers. This is done within the framework of opportunities and threats in the external environment. Change is a fact of life, and organizations have to adapt to this ever-changing environment. Companies control the changing environment and continuously adapt their businesses to their best opportunities. Marketing environment is competitors, the economic situation and demographic, technological, political, cultural changes, and so on. The marketing environment comprises the ‘non-controllable’ factors and forces that affect a company’s markets and marketing.
A firm functions in a complex, dynamic, rapidly changing, hypercompetitive external marketing environment. This environment must be always monitored in order for the firm to survive and prosper in today’s market. Much of this external environment is beyond the control of the firm, but it still affects the firm’s functioning to a great extent.
While the firm or industry can have some degree of influence on this internal marketing environment, these outside forces are not under the firm’s control and are changing at an accelerated rate. Though these forces cannot be controlled, failure to realize their influence can be extremely damaging. For example, it occurred in many companies’ slow response to the Internet and e-commerce.
One key to the success of an organization is the ability to predict change and to adapt the firm’s offerings to that change. It is the function of marketing research. It’s important for the company to constantly monitor the external marketing environment for new and changing needs.
So, businesses do not undertake marketing activities alone. They face threats from competitors, and changes in the political, economic, social and technological environment. All these factors have to be taken into account as a business tries to match its capabilities with the needs and wants of its target customers. To survive they need to take account of, and adapt to, changing economic and technological conditions and monitor changing needs and wants of their target markets.
1. Match the underlined words in the article with their explanations:
1.to provide something that is suitable for a particular situation, person, or purpose
7.having a negative effect
10.a company, firm
11.to change your ideas or behaviour so that you can deal with a new situation
12.the conditions and influences in which people carry on a particular activity
14.to manage to deal with something difficult or unpleasant and to continue to exist
16.the ability to do something
17.to take place
19.a lack of success in doing something
20.to regularly check something
22.a situation or activity that could cause harm or danger
The wider external environment is termed the ‘macro-environment’. Marketing macro-environment consists of many external uncontrollable forces. They affect the firm’s marketing activities to a great extent. The firm can control the elements of its marketing mix, but it has no control over these external forces. These forces can be political, economic, socio-cultural (sociological) and technological factors (‘PEST’ or ‘STEP’) in the market environment on a macro level. The relationship between the company and these factors is indirect.
· Legal forces are laws which protect consumers and competition in the market.
· Economic forces are economic conditions affecting the economic ability of the customer to buy.
· Societal forces include social and cultural values, consumer movement and environmental concerns.
· Competitive forces include the actions of competitors with their own marketing plans.
· Political forces are government regulations and policies that affect marketing.
· Technological forces or changes make a product obsolete.
Recently, ‘legal’ factors have been isolated from ‘political’ factors, making the acronym ‘SLEPT’. Even more recently, the acronym has become ‘PESTLE’ with the extra ‘E’ standing for ‘environmental’. Its latest incarnation is now ‘STEEPLE’ with another ‘E’ standing for ‘ecological’.
All these forces influence decisions about the marketing mix of the firm and its marketing strategy.
This is a STEP analysis for an online supermarket in Britain.
Dominant religions: Mainly Christian, with significant minorities in some regions. Special diets in some areas.
b)changes in the fixed and variable costs of business
c)new production methods
d)national government policy
e)changing tastes and fashions
f)level of consumer spending
g)developments in IT that open new markets
h)the economy, inflation, unemployment
i)EU / WTO regulations
j)lifestyle changes (e.g. more people living alone)
k)pressure from environmental or fair trade lobbies
l)breakthrough products arising from R&D
4. Complete the STEP analysis of France:
distribution birth religion rates
agreements communication gender
France is a member of the European Union and as such has trade (1) _____ with the other members. It has one of the worst unemployment (2)_____ in Europe and the government is keen to bring this down.
France has one of the highest (3)_____ rates in Europe (1.9 children per woman) and a large proportion of French mothers go back to work, reflecting changes in (4)_____ roles. Men are almost as likely as women to do the shopping for the family and take care of the children.
The dominant (5)_____ is Catholicism, but there is a large Muslim community. The religious beliefs do not significantly affect the marketplace, except at Christmas and Easter time when the demand for Christmas trees and chocolate increases dramatically.
Internet penetration is high: most households own a computer and have high speed internet access. This has opened up new channels of (6)_____ and there are now several internet grocery stores.
Nearly all teenagers own a mobile phone and they are increasingly using SMS messages to keep in touch with their peers. Marketing campaigns are beginning to exploit this line of (7)_____ by sending SMS messages to their audience.
The major actors in a company’s micro-environment are the company itself, suppliers, market intermediaries, distributors, customers, competitors, advertising agencies and market research companies.
The company is an association of people formally registered as a business (partnership, limited company, etc.). It is an organization that provides services or makes or sells goods for money. All the departments within a company (e.g. finance, production, human resources) influence the marketing department’s plans and actions. A company can be called a firm or a business. When it is producing goods or trading, we say it is in business. A company which is just starting up is going into business and a firm which stops operating goes out of business. If a firm becomes bigger, it expands. The expansion means that a company will produce more goods or sell more products. A manufacturer (producer) manufactures (produces) goods. They are its products. When a manufacturing company expands, it means that it increases its production (manufacturing).
A company selling goods in large quantities (in bulk) is called a wholesaler. A person or a company buying in bulk (wholesale) and selling goods in small quantities is a retailer. Many local shops sell goods retail.
The supplier is any person or business that sells raw materials, finished goods, components, services or other resources to producers of goods or services. Developments in the supplier environment, such as prices and availability of raw materials, have a substantial influence on a company’s marketing operations.
The market intermediaries are all people or organizations in the marketing channel between producers and customers. Middlemen such as agents, wholesalers and retailers, are powerful and important actors. In some cases they can dictate terms and even, if treated badly, bar the manufacturer from certain markets.
Customer is a person or organization that buys a product or service from a shop or a producer.
Competitors are organizations selling products or services in the same market.
The following factors have a direct impact on the company and its stakeholders: consumers, employees, shareholders and suppliers. The company has an influence over these factors.
A company must understand consumer needs and meet them.
You must differentiate your brand from your competitors’.
Employing the right people and keeping them motivated is essential. Training and development play a key role in the service sector.
Positive or adverse (negative) media attention can seriously affect an organization. Consumer programmes on TV and consumer magazines that people read have a powerful effect on the marketplace.
It is important to satisfy shareholders’ needs without harming the
brand in the long term.
Changes in the price or quality of raw materials – for example wood, or metals – will affect the marketing mix. Good relations with suppliers will make business easier.
4. Match the underlined words in the article with their explanations:
1.to become larger in size, to grow by including more people, moving into new areas, selling more products
2.to officially say that something must not happen, or that someone must not do something
3.the position of being one of two or more people who own a company
5.the department within a company that is responsible for employing and training people
6.to become larger in amount or number
7.substances such as coal or iron that are in their natural state before being processed or made into something
8.to put your name and other information on an official list
10.things such as coal, trees, and oil that exist in nature and can be used by people
6. Answer the questions:
1.What is the marketing environment?
2.What are the main non-controllable actors of the marketing environment?
3.What forces affect the marketing activity of the firm?
4.What forces does the external marketing environment consist of?
5.Name the external forces. What does each force influence?
6.What forces does the internal marketing environment consist of?
7.Characterize each actor of the micro-environment?
7. Guess the definitions of the adjectives below:
1.relating to advanced scientific knowledge used for practical purposes, especially in industry
2.relating to the law or lawyers or allowed by law
3.relating to business, industry, and trade
4.coming from outside a place or organization
5.relating to society or the way society is organized
6.existing or happening within something such as a process, system, organization
7.trying to be more successful than other people, organizations, products, etc.
8.relating to relationships of power that exist between people in an organization
a) competitive b) internal c) societal d) legal
e) political f) external g) economic h) technological
8. Decide whether the following market environment characteristics are micro factors or macro factors.
1 High unemployment in a region reduces spending on leisure activities.
2 The internet has opened up new distribution and marketing channels.
3 Good relations between a supplier and a company mean that goods are always delivered on time.
4 Legislation in European countries is restricting the right to smoke in public places.
5 Positive reports in the national press about a brand.
6 The staff for the telephone hotline of an internet bank are trained to be polite and friendly.
7 During the FIFA World Cup, more snack food is consumed in front of the TV set.
9. Complete the action plans (1–6) and then match them with the micro factors (a–f).
understand development consumer satisfy differentiate relations
1.Convince shareholders that the best way to …… their needs in the long term is to invest in research and development.
2.Carry out market research to better …… needs and desires.
3.Prepare a press release for a …… magazine about the launch of a new product.
4.Build and maintain good …… by always paying on time.
5.Do a SWOT analysis to …… assess how to your brand from your competitors’.
6.Implement a training …… and plan to motivate and keep good members.