Marketing

1. Key concepts in marketing

1.1. Definitions
Match the items in the table with the definitions below:

promotional the 4 Ps marketing market brand

mix mix segmentation awareness

prestige marketer sales direct marketing market niche

pricing promotion

1. the main factors that influence a customers decision to buy a particular

product or service, which a business must consider when it is deciding how
to advertise and sell its products _______________________

2. product, price, promotions and place, which together form the marketing
mix, and which should be carefully planned if a product is to be sold
successfully _____________________

3. the act of dividing possible customers into groups according to their age,
income, sex, class, etc.; one of these parts ______________________________

4. the business of selling products or services directly to customers by

contacting them by mail or telephone, by visiting their homes or through
online computer shopping ___________________

5. a group of customers that a companys products are especially suitable for

and which the company is seen as belonging to; a product, service or
company that is different from or better than others in the same area
______________________________

6. a combination of all the elements that make up a company's promotion,

including sales promotions, advertising, public relations, sponsorships etc.
______________

7. a specialist in marketing; a business that sells goods or services to the

public or that sells in a particular way ______________________________

8. to what extent people know about and recognize a particular product

__________________

9. setting a high price to maintain an image of quality and exclusivity

____________________

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10.activities done in order to increase the sales of a product or service,
including special offers (discounts), bonuses ('buy one, get one free), free
samples, catalogues, games and contests etc. __________________________

green marketing product line product range a B2B, B2C, B2G

product

marketing diversification opt in guerrilla

marketing

a fifth and a sixth the tipping point target market product life cycle
P

11.the moment when something such as a cost, the amount of resources, the
number of users, etc. reaches the stage where it begins to have an effect or
something changes ____________

12.the theory that sales of a product pass through four stages: introduction,
when there is a gradual increase in sales; growth, when sales increase
rapidly; maturity, when sales increase slowly; decline, when sales fall
_____________________

13.developing a wider range of products, markets, investments, etc. in order to

be more successful or reduce risk ______________________

14.marketing that tries to present a product or company as not harmful to the

environment; ______________________

15.a type of marketing that uses different and unusual methods to achieve the
greatest effect for the smallest amount of money _____________________

16.when the user of a companys website gives their email address so that
they can be sent information about particular subjects, products or services
__________________

17.the group of people that you want to sell your products to

____________________

18.a group of related products that are physically similar or intended for the
same market ______________________________

19.a business-to-business product; a consumer product aimed at end-users;

products for use in hospital, schools, public transport etc.
___________________________

20.the activity of presenting, advertising and selling a companys products in

the best possible way ______________________________

21.packaging and people ______________________________

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22.assortment of product lines and individual offerings
________________________

1.2. Using marketing terms in context

Complete the sentences below so that you use the appropriate term
among the three options provided below each sentence a-l.

a. _____________________________ permits firms to tailor products for specific

markets. New software allows much finer ___________________ and better
understanding of customers' needs. (The same phrase should be used in both
gaps!)
a. diversification b. sales promotion c. market segmentation

b. We are running a __________________ in October with a 20% discount on our

camera phones.
a. sales promotion b. promotional mix c. diversification strategy

c. With personal computers and software, the trend is toward shorter and shorter
___________________________.
a. product range b. product lifecycle c. sales promotion

d. We have abandoned our __________________________ strategy to focus on core

activities.
a. diversification strategy b. market niche c. green marketing

e. There are companies that spend millions of dollars maintaining

__________________________, which is the first step towards developing brand
loyalty.
a.the target market b. the promotional mix c. brand awareness

f. The importance of __________________________ is often underestimated: it attracts

the buyer's attention, it explains the benefits of the product inside, it describes
contents and, of course, it protects the product during handling. And these days
environmentally-friendly package can give your product a competitive edge.
a. promotional mix b. product range c. packaging

g. They claimed that oil companies had spent more on _________________________

campaigns than on cleaning up their operations.
a. tipping point b. guerrilla marketing c. green marketing

h. __________________________ cuts out the costs of supplying shops and enables

customers to buy at lower prices.

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 a. market segmentation b. direct marketing c. prestige pricing

i. What is the __________________________ where the higher cost of buying a new car
is justified by the cost of maintaining the old one?
a. tipping point b. sales promotion c. target market

j. Our __________________________ for this drink is teenagers.

a. marketer b. diversification c. target market

k. Our __________________________ consists of an extended TV and radio advertising

campaign.
a. diversification b. market segmentation c. promotional mix

l. The company has grown beyond its original _______________________.

a. promotional mix b. market niche c. direct marketing
1.3. Related terms: Marketing / advertising / PR / branding
Match the items in the three columns below.

A - term B - definition C - example

1. the use of a particular name, symbol Do you use the corporate

marketing (logo) and design for a companys ___________on all your
products so that people will leaflets?
recognize them

2. the business of giving the public The company invests

advertising information about a particular heavily in the ________ of its
organization or person in order to brands.
create a good impression

3. PR the activity of presenting, Are you easily persuaded

advertising and selling a companys by television ___________?
products in the best possible way

4. branding the act of making a company, a Your website is a vital

product or a service known to the ___________ tool.
public; the notices, pictures and
short films that a company uses to
tell people about itself and its
products

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2. Reading I: Starbucks No Longer a Luxury?
By Katherine Glover (2009)

Look at the headline and try to interpret it. Then read the story to check
your ideas.

1. A friend of mine, on the road for business, recently found

himself at a small coffee shop in South Dakota, where he was served a
tepid cup of vile-smelling brown water. My friend smiled at the
waitress, stepped outside, and promptly emptied the cup into the
bushes.
2. Before Starbucks was around, he told me, he never would
have done such a thing. He was used to drinking crap coffee. But
Starbucks has raised the bar. The ubiquity of Starbucks has made us
expect at least halfway decent coffee no matter where we are and
in response, more and more players have jumped into the market. As
someone recently commented, these days, you can get a good cup of
coffee at a Chevron station.
3. This leaves Starbucks in quite a bind. Not only is Starbucks
perceived as a luxury brand in a time when people cant afford
luxuries, but the luxury it offers is readily available elsewhere.
4. And for less money. Maybe. Though according to a recent
Chicago survey, some drinks at Starbucks are actually cheaper than
equivalent drinks at Dunkin Donuts. Part of Starbucks new strategy,
in fact, is to debunk the myth of the $4 latte, as Starbucks

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marketing VP Michelle Gass described it. We have got to correct the
misperceptions that are out there, she said.
5. Then again, its not exactly difficult to run up a $4 tab at
Starbucks, depending on what you order, and the same Chicago
survey confirmed that McDonalds drinks were still consistently
cheaper than those of Starbucks. McDonalds, of course has been
aggressively perpetuating that $4-latte myth with its ad campaign
for McCafes, centered around the motto Four bucks is dumb.
6. To counter this, Starbucks is training its staff to emphasize
that most drinks are less than $3, and its also offering discounted
breakfast pairings. But some analysts think cutting prices now will
sully its high-end image. Or, as another put it: It is now an
admission that everyone who has said Starbucks was too expensive
was right.
7. Im curious to see what will happen with Starbucks latest
innovation its upscale instant coffee, Via. Its not as good as fresh-
brewed, apparently, but its better than most instant brands. On the
other hand, it costs ten times more. Some tasters concluded theyd
stick with the cheap crystals for now. But who knows maybe in a
few years, theyll up their standards and start dumping that stuff in
the bushes.

After you read

1. Vocabulary. Match the items in tables A and B. Some items in B can be used
more than once.

A B A
B
verb noun adjective / noun noun
debunk ____________ high-end _____________
sully ____________ the standards upscale ______________ brand
up ____________ the bar instant / luxury coffee
____________
a myth latte
raise ____________ fresh-brewed ____________
a $4 tab image
perpetuate___________ the $4____________
someone's image breakfast
_
pairings
run up _____________ discounted ____________

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2. Answer the questions below:

a. Explain the reasons for the customer's reaction in paragraph 1.

b. How has 'the ubiquity of Starbucks' changed customer expectations?
(see paragraph 2)
c. What leaves Starbucks 'in quite a bind'?
d. What misperceptions concerning Starbucks need to be corrected? (see
paragraph 4)
e. How do the prices at Starbucks compare to their competitors? (see
paragraphs 4&5)
f. What kind of a shift in the Starbucks' strategy is described? Explain why,
according to some, this new strategy may not be a smart move.
(paragraph 6)
g. What forecast regarding the Starbucks' latest invention is given in
paragraph 7?

3. Explain how some of the following terms are related to the text:
marketing brand association diversification 4 Ps: pricing
strategy
upmarket / high- quality 4 Ps: place promotion
end

3. Community building in online marketing

Read the following passage and explain how you can benefit from using an
online community of users or specialists to promote your business. Several
options of community building are provided.

Insert the items at the top of the table into appropriate gaps 1-8 in the text.

____ the social bonding ____ well-established user

community
____ business-to-consumer 1 to feel part of the site
and business-to-

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 business
marketplaces
____ forging relationships ____ making other users aware
with
____ your own marketing ____ user forum or online
purposes community

Some website owners try to build up a community of online users

through the development of online chat rooms, discussion groups
and online events. Such groups encourage users 1) ____ by
posting their own information and responding to other users.
There are different ways in which you can seek to utilise online
communities for
2) ____.

If you operate in a specialist field, then you could consider setting

up your own 3) _____ for other people with similar interests. Users
generally value both the information and 4) ____they receive from
such a community. The business that builds the community can
present products and messages that are customised to the
group's interests, 5) _____ the individual members in the process.

If there is already a 6) _____ in your area of business, then you

might wish to consider joining it and using it as a means of 7)
_____ of the products or services that you offer.

While consumer communities are the most visible, you should note
that business professionals also subscribe to discussion groups
that focus upon their own particular field. Communities can
therefore be used to enhance relationships with customers and
prospects in both the 8) ______ .

Advertising
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 2.1. Advertising effectiveness and media
Match these advertising media to the advantages (+) and disadvantages (-)
below:

direct mail, Internet, magazines, newspapers, outdoor, radio,

television

1. __________________
(+) a good coverage of local markets; ads can be placed
quickly; ads can be cut out and saved.
(-) ads compete with other text; ads get thrown away (short
life span)

2. ___________________
(+) can target very specific audiences in specialist
publications; long life of ad (usually several weeks); ads can be cut
out and saved
(-) ads must often be placed months in advance; cost is
relatively high

3. ___________________
(+) uses sight, sound and motion; reaches a wide audience;
high attention with no competition from other material
(-) very high cost

4. ____________________
(+) low cost; can target specific audiences; very flexible; good
for local marketing
(-) may have low attention because it is a background
medium; audiences may not remember ad (only one physical sense
involved and nothing to keep)

5. _____________________
(+) high visibility and repeat exposure; relatively low cost;
strong local focus
(-) limited message; difficult to get attention of audience for
any one specific ad

6. ____________________
(+) if linked to a customer database can be targeted at very
specific markets; very flexible; ad can be saved
(-) high cost; consumers may reject ad as 'junk'

7. ____________________
(+) connects a company with its customers at the precise
moment they are looking for a product; global coverage at a
relatively inexpensive price; interactive; 24/7

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 (-) many 'eyeballs' but few 'click-throughs'; click fraud (clicks
on your advert arranged by dishonest companies or competitors,
not made by potential customers)

How do the features in examples 1-7 above refer to online marketing

practices described on pages 7-8?
2.2. Reading II: An interview with Philip Kotler (2005)
Before you read
Use the words in each underlined group below to form a correct phrase.

1. He is the author of Marketing Management, one of the most widely used

BOOKS MARKETING SCHOOLS GRADUATE IN BUSINESS worldwide.

__________________________________________

2. Americans are exposed to hundreds of ad messages a day and TUNE

TRYING IS OUT TO.

__________________________________________

3. James Bond used a Sony cell phone and FEATURED WRISTWATCH

PROMINENTLY OMEGA AN.
__________________________________________
4. Products are also mentioned in novelsin fact, NOVEL COMMISSIONED
MYSTERY BULGARI A WHOLE to be written called The Bulgari Connection.
__________________________________________
5. Celebrity endorsements. ENDORSEMENTS A BOOST MICHAEL JORDAN'S
GAVE to Nike shows.
__________________________________________

6. What is the COMMUNICATION CHALLENGE MAIN?

__________________________________________

7. There is a great deal of INTEGRATED HYPE COMMUNICATIONS ABOUT

MARKETING.

__________________________________________

8. Among MASS VEHICLES FEW THE AUDIENCE are the Super Bowl and the
Olympics.

__________________________________________

9. Google has developed a system to ALIGN PAID-FOR TOPICS NEXT TO ADS

BEING SEARCHED by consumers.

__________________________________________

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10.Furthermore the message can be fresher and more believable. PR is better
equipped to NEW SERVICE ABOUT "BUZZ" A PRODUCT CREATE OR.

__________________________________________

11. Which of the CAPTURE TO AUDIENCES ALTERNATIVE WAYS are used in

your country?

______________________________________

12. PUBLIC MARKETING AND RELATIONS WORD-OF-MOUTH are playing a

growing role within the marketing mix to build and maintain brands.

_________________________________________

The following interview with the contemporary marketing guru Philip

Kotler was made some time ago. Read the text and discuss the trends
he is forecasting in this text from todays perspective.
Reading II: An interview with Philip Kotler (2005)
Read each section carefully and answer the questions.

1. Does the term marketing mix refer to a fixed concept?

2. What is overdone and what is underdone?

Philip Kotler is Distinguished Professor of International Marketing at the Kellogg

School of Management. He is the author of Marketing Management, one of the
most widely used marketing books in graduate business schools worldwide, and
numerous other books and articles. The following article deals with the relative
merits of advertising and public relations in the marketing mix.

Question: Can you please say something regarding "the need for a new
marketing mix"?

Kotler: The original marketing mix was not 4Ps but about 14. Neil Borden many
years ago used a large list of marketing tools. We can always add to the list. So
the question isn't "what tools constitute the marketing mix" but, rather, "what
tools are becoming more important in the marketing mix."

For example, I feel that advertising is overdone and public relations is

underdone. And direct-marketing tools are also rising in importance in the
marketing mix.

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3. How many reasons for TV losing its effectiveness are given?

4. Which of the alternative ways to capture audiences are used in your country?

Question: TV advertising seems to be losing its effectiveness. What are

alternative ways to get attention?

Kotler: The average American is exposed to several hundred ad messages a day

and is trying to tune out. TV advertising is losing its effectiveness because of
growing advertising clutter, the increasing number of channels, the availability
of zapping mechanisms, and reduced watching of television by certain groups.
The result is that marketers must consider other methods of getting consumer
attentions.

Here are a number of alternatives: sponsorships, e.g. stadiums; mentions on talk

shows, e.g. David Letterman; product placement, e.g. James Bond movies;
celebrity endorsements, e.g. Michael Jordan; body advertising, e.g. Dunkin'
Donuts logos on students foreheads etc.

5. Are public relations and word-of-mouth marketing part of the problem or part
of the solution?

Question: What is the main communication challenge?

Kotler: The major challenge today is getting people's attention. Consumers are
pressed for time, and many work hard to avoid advertising messages. The main
challenge is to find new ways to capture attention and position a brand in the
consumer's mind. Public relations and word-of-mouth marketing are playing a
growing role within the marketing mix to build and maintain brands.

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6. What is the connection between: separation / integration of tools / allocation
of budget?

7. What is the role of the CCO?

8. What should be communicated consistently?

Question: There is a great deal of hype about integrated marketing

communications. What is the status of this subject today?

Kotler: In the past, we taught separate courses on advertising, sales promotion,

public relations and other communication tools. Each student became a
specialist in one of these areas, remaining ignorant of the other tools. Within
companies, the advertising person always received the biggest budget for
marketing communication (leaving out the sales force), and the others would
fight for the crumbs.

Clearly, this is not a good situation, especially considering that the effectiveness
of different communication tools changes over time. Someone must be put in
charge of deciding how much to allocate to the different promotional tools. Let's
call that person the chief communication officer (CCO). That person should be
responsible for everything that communicates anything about the companynot
only the standard communication tools but also corporate dress and even the
look of the company's trucks. The company's brand and customer message must
be communicated consistently through all media. Thus, if a company wants to be
known for its high quality, it has to produce high quality and communicate high
quality in all of its messages.

9. What are the drawbacks of mass advertising?

10. Is mass advertising to be abandoned altogether?

Question: Companies continue to spend more money on TV advertising,

even as channels proliferate and more channel-switching takes place.
Aren't companies being slow to realize TV advertising effectiveness has
fallen?

Kotler: Companies are still fairly blind to the cataclysmic changes in the
communication marketplace. The days of mass advertising, with its waste and
intrusiveness, are passing quickly. I have advised clients to reduce their TV
advertising budgets, especially mass advertising. Fewer people are watching TV,
many are zapping commercials, and most commercials are too brief to be

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effective.

Among the few mass audience vehicles are the Super Bowl and the Olympics.
The growing fragmentation of media audiences requires marketers to shift to
target marketing and even one-to-one marketing. The good news is that this will
reduce wasted media exposures. What good is it to advertise cat food on
national television if only 25% of families own a cat?

11. Why are the glorious days of mass advertising gone?

12. What makes PR a more suitable vehicle for reaching audiences?

Question: How can companies effectively reach mass audiences?

Kotler: Advertisers won't see again the glorious days when they could reach
millions of people in the evening with the same TV show or mass magazine.
There are three options today: One is to advertise on a number of media
channels in the same time slot. Another is to advertise on Super Bowls, the
Olympics, and other major worldwide events that attract large audiences. A third
is to build a giant database containing the names of people who have the
greatest interest in the company's offerings.

Question: Some media analysts call for more spending on public relations. Do
you agree?

Kotler: I agree. Advertising has been overdone in the past, especially mass
advertising with its "hit or miss" quality. PR has been underdone. PR consists of
many tools, which I call the PENCILS of PR: publications, events, news,
community involvement, lobbying, and so on. When a customer sees an ad, she
knows it is an ad, and an increasing number of customers are tuning ads out. PR
has a better chance of getting a message through it can be fresher and more
believable. PR is better equipped to create "buzz" about a new product or
service.

After you read

Task I: Note-taking
Summarize the main points Kotler is trying to make regarding the role of
advertising agencies, including the challenges and solutions he forecasts.

Complete the table below by using information from the interview.

challenge (problem) outcome solution (if mentioned)

Americans exposed to try to __________ marketers must consider
too many ads other methods of getting

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consumers avoid
advertising messages
separating marketing
communication tools
TV channel proliferate
and more channel
switching takes place
advertising limitation
mass advertising
different communication
tools are traditionally
dealt with separately;
Task II: Matching definitions
E-marketing concepts
Match the terms in the table below to the corresponding definitions below.
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consumer attentions:
_______________ etc.
hard to capture find _____________
consumers attention _________________
public relations and word-of-
mouth marketing
ineffective advertising ______________a Chief
Communication Officer
fall of TV advertising reduce TV advertising
_____________ budgets
and concentrate on other
media
traditional advertising setting up systems that
works as a ____________ enable _____________
not targeted enough use channels that allow target
marketing, even one-to-one
marketing;
more insistence on
_________marketing
uneven ____________ clear & consistent
allocation; communication with
customers (communicating
dominance of high quality)
____________over other
tools integration of tools;
more reliance on _________
15
 Ad Serving Really Simple Syndication Hit
(RSS)
Web portal User generated content Click-through
(UGC)
Pay Per View (PPV) Cookie Location Based Services
(LBS)

a. A website or service that offers a broad array of resources and services. They
include email, forums, search engines, and online shopping malls.
b. Software that allows you to flag website content (often from blogs or new sites)
and aggregate new entries to this content into an easy to read format.
c. A small text file on the users PC that identifies the users browser and hence,
the user so they are recognised when they re-visit a site.
d. Delivery of online adverts to an end users computer by an ad management
system. The system allows different online adverts to be served in order to
target different audience groups and can serve adverts across multiple sites.
e. Online content created by website users rather than media owners or publishers
- either through reviews, blogging, podcasting or posting comments, pictures or
video clips.
f. Is an ecommerce model that allows media owners to grant consumers access to
their programming in return for payment. Micro payments may be used for
shorter programming whilst feature films may attract larger sums.
g. A range of services that are provided to mobile subscribers based on the
geographical location of their handsets within their cellular network.
h. When a user interacts with an advertisement and clicks through to the
advertisers website.
i. A single request from a web browser for a single item from a web server.

Explain how some of online marketing concepts are related to

marketing issues / challenges discussed by Kotler. Although they help
overcome some issues of conventional marketing, can you suggest any
challenges these novel online marketing concepts imply?

Source: http://www.iabuk.net/en/1/jargonbuster.html

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Key:

Pages 1-2

12. product life cycle

13. diversification
14. green marketing
1. marketing mix 15. guerrilla marketing
16. opt in
2. the four Ps 17. target market
18. product line
3. market segmentation 19. a B2B product/a B2C product/a B2G
product
20. marketing
4. direct marketing 21. a fifth and a sixth P
22. product range
5. market niche

6. promotional mix

7. marketer

8. brand awareness

9. prestige pricing

10. sales promotion

11. the tipping point

Page 3.
(allow a fine) market segmentation
run a sales promotion
the trend toward shorter product life cycles planned obsolescence
abandon a diversification strategy
maintain brand awareness
underestimate the importance of packaging
spend a lot on green marketing campaigns
direct marketing
the tipping point at which something becomes justified
a target market for a certain product
a promotional mix consists of
to grow beyond ones original market niche

Page 4.
Advertising - the act of making a company, a product or a service known to the public; the
notices, pictures and short films that a company uses to tell people about itself and its products:
Are you easily persuaded by television advertising?

Marketing - the activity of presenting, advertising and selling a companys products in the best
possible way: The company invests heavily in the marketing of its brands.

Branding - the use of a particular name, symbol (logo) and design for a companys products so
that people will recognize them: Do you use the corporate branding on all your leaflets?

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Page 8

Some website owners try to build up a community of online users through the development of
online chat rooms, discussion groups and online events. Such groups encourage users to feel
part of the site by posting their own information and responding to other users. There are
different ways in which you can seek to utilise online communities for your own marketing
purposes.

If you operate in a specialist field, then you could consider setting up your own user forum or
online community for other people with similar interests. Users generally value both the
information and the social bonding they receive from such a community. The business that
builds the community can present products and messages that are customised to the group's
interests, forging relationships with the individual members in the process.

If there is already a well established user community in your area of business, then you might
wish to consider joining it and using it as a means of making other users aware of the products
or services that you offer.

While consumer communities are the most visible, you should note that business professionals
also subscribe to discussion groups that focus upon their own particular field. Communities can,
therefore, be used to enhance relationships with customers and prospects in both the business-
to-consumer and business-to-business marketplaces.

Page 9

He is the author of Marketing Management, one of the most widely used marketing books in
graduate business schools worldwide.

The average American is exposed to several hundred ad messages a day and is trying to tune
out.

James Bond used a Sony cell phone and prominently featured an Omega wristwatch.
Products are also mentioned in novelsin fact, Bulgari commissioned a whole mystery novel to
be written called The Bulgari Connection.
Celebrity endorsements. Michael Jordon's endorsements gave a boost to Nike shows.

What is the main communication challenge?

There is a great deal of hype about integrated marketing communications.

Among the few mass audience vehicles are the Super Bowl and the Olympics.

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Google has developed a system to align paid-for ads next to topics being searched by
consumers.

Furthermore the message can be fresher and more believable. PR is better equipped to create
"buzz" about a new product or service.

Which of the alternative ways to capture audiences are used in your country?

Public relations and word-of-mouth marketing are playing a growing role within the marketing
mix to build and maintain brands.

Page 12
cause (problem) result solution
(if mentioned)
Americans exposed to too try to tune out marketers must consider
many ads other methods of getting
consumer attentions:
sponsorships etc.
consumers avoid advertising hard to capture consumers find new ways to capture
messages attention attention
public relations and word-of-
mouth marketing
separating marketing ineffective advertising designate a Chief
communication tools Communication Officer

TV channel proliferate and fall of TV advertising reduce TV advertising

more channel switching takes effectiveness budgets and concentrate on
place other media
advertising limitation traditional advertising works setting up systems that
as a monologue enable dialogue

mass advertising not targeted enough use channels that allow target
marketing, even one-to-one
marketing; more insistence
on direct marketing
different communication tools uneven budget allocation; clear & consistent
are traditionally dealt with dominance of advertising communication with
separately; over other tools customers (communicating
high quality)
integration of tools;
more reliance on PR
Page 14

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Ad Serving d. Really Simple Syndication (RSS) b. Hit i.

Web portal a. User generated content (UGC) e. Click-through h.

Pay Per View (PPV) f. Cookie c. Location Based Services (LBS)

g.

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