MARKETING AND MANAGEMENT
Keynotes
The various activities of the marketing process are referred to as the marketing mix and traditionally include the four Ps:
product (characteristics and features)
price (appropriate market price)
promotion (communicating the product’s benefits)
place (distribution of the product in markets).
In order to gain a competitive advantage over rivals, companies create brands that represent aspirations and a desirable image of life that the customer would like to identify with.
I. What is marketing?
Marketing is in many ways the central activity in business management. In commercial organizations, marketing is ‘everybody’s business.’
Marketing is the term given to all the different activities intended to make and attract a profitable demand for a product. This involves:
- identifying consumer needs and wants in order to develop the product
- setting the price
- deciding on the best place to sell the product
- deciding on how best to promote the product
These four factors are often referred to as ‘ The four Ps’. These are special techniques used to market a brand.
Product (or service): what you sell, and the variety or range of product you sell. This includes the quality (how good it is), branding, and reputation (the opinion the consumers have) of the product. For a service, support for the client after the purchase is important. For example, travel insurance is often sold with access to a telephone helpline in case of emergency.
Price: how much the product or service costs.
Place: where you sell the product or service. This means the location of your shop, or outlet, or the accessibility of your service – how easy it is to access.
Promotion: how you tell consumers about the product or service.
Today some marketers talk about an additional four Ps:
People: how your staff (or employees), are different from those in a competitor’s organization, and how your clients are different from your competitor’s clients.
Physical presence: how your shop or website looks.
Process: how your product is built and delivered, or how your service is sold, delivered and accessed.
Physical evidence: how your service becomes tangible.
For example, tickets, policies and brochures create something the customers can touch and hold.
Reading 1
1 Before you start: What is marketing? Why is it important?
2 Read the article about marketing. Match the questions (1-6) with the paragraphs (a-f).
1-How do I meet my objectives?
2-What do I want to achieve?
3-What is marketing?
4-How do I communicate my message?
5-How do I find out this information?
6-What do I need to know?
Marketing
a) Marketing is finding out about your customers and competitors so that you can provide the right product at the right price.
b) Think about people you want to sell to: your target market. Different products have different target markets, for example, Swatch and Rolex watches. Questions to ask are:
~Who are my customers- age, sex, income?
~What is the size of the market?
~Is it possible for the market to get bigger?
~What about product awareness? - do people know about my company’s products?
c) You find out this information through market research. Market research uses interviews to find out about people’s attitudes and questionnaires to find out about their shopping habits.
d) When you know who your customers are and how big your market is the next step is to set your objectives. Do you want to increase sales? To increase market share? Or to make your product different from the competition?
e) Next, think about your strategy for meeting your objectives. If your objective is to increase market share, you could:
~ find new customers by making your product more attractive
~ take customers from your competitors
~ persuade your customers to use more your product.
f) How will you make your strategy work? What message do you want to send? There are many types of promotion and it is important to choose the right one,e.g.
~ advertising on TV, in newspapers, etc.
~ direct marketing by post (mail shots)
~ telesales- selling to customers on the phone
~ point-of –sail material in shop- free samples of special offers.
Now you are ready to launch your product in the market. Good luck!
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Vocabulary
3. Match the highlighted words and phrases in the text with the definitions (1-8).
1 ways of telling people about your products ______
2 the part of the total market that buys your product ______
3 knowledge of your company’s products ______
4 other companies that sell similar products ______
5 finding out about the market ______
6 to introduce a new product to the market ______
7 the kind of people you are interested in selling to ______
8 a plan you use in order to achieve something ______
4. Look at the text again. Find and underline:
1 two market research methods
2 three marketing objectives.
Speaking
5. Work in pairs. Take turns to describe the marketing process. Use these phrases:
~First you have to… ~Then… ~Next… ~After that… ~Finally
6. Work in groups. Think of a product you would like to produce and sell. It could be a new kind of snack or sweet or a new range of make- up. You decide. Give your product a name.
7. You are ready to market your product. Draw up a marketing report. Then present your report. Use the plan:
1 Product name, 2- Target market
3 Strategy, 4- Promotion , 5- Ob- ! Do some research. Think of a product you
jectives. know or buy regularly, and about a compa-
ny which produces it. Who is their target
market? Objectives? Market share? Who
are their competitors? Tell the class.
II. GLOBAL BRANDS
1 Work with a partner. Look at the logos of some multinational companies. What is the name of each company? What does it produce or sell?
1 2 3
8
4 5 6 7
2 Discuss the questions:
-Are these brand names well known in your country?
-Have you ever bought or used any of their products?
-Do you buy particular brands of food or clothes? Why/ Why not?
-What are brands for?
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3 Answer the questions:
- What are your favourite brands of the following products: soft drinks, clothes, cars, shampoo?
- Why do you prefer these to other similar brands?
4 Now choose one of the products you use and consider the marketing mix for that brand. Express your opinion. Think and speak about the following:
product - what are the product's features?
place - where can you buy the product?
price - in comparison with similar products
promotion - where and how is it advertised?
Reading 2
1 Read the text which describes how Shell Oil developed a new brand image, and see if it mentions any of the market research methods. What techniques did Shell Oil use?
Hello to the good buys
A new marketing campaign promising hassle*-free and faster fuel buying for customers is under way in America. Suzanne Peck reports on the 18-month research project which involves Shell Oil researchers ‘moving in’ with their customers to test their buying habits.
Three years ago when Sam Morasca asked his wife what could be done to exceed her expectations when buying gasoline, her answer ‘that I would never have to think about it any more’ made him pause and think.
The marketing people from Shell Oil Products, of which Sam is vice-president, were desperately seeking ways to increase the business, and to come up with a strategy which would put them clearly ahead of their competition by differentiating the Shell Oil brands in the eyes of consumers. ‘We are big business for Shell Oil, contributing US $7 bn of revenue, and the leading retailer of gasoline, but it is a fragmented market and the mission was to profitably expand the business,’ said Sam.
Today, after 18 months of cutting edge research, Shell Oil is on track to make buying fuel at their 8,900 service stations clearly different with a new brand initiative. Its aim is to deliver through facilities, systems upgrades*, and new operating practices, a hassle-free fueling experience targeted at specific customer segments.
Over the past few years, the company has been developing detailed knowledge of consumer needs and attitudes, which formed the basis for the new brand initiative. Team leader Dave Yard, manager of Strategy and Planning-Marketing, picks up the story. ‘We began with a customer segment study of 55,000 people, who we stopped in shopping malls in six cities for a 45-minute interview into their attitudes, especially regarding driving and cars. The result was that everyone wanted three things from a service station: competitive price, a nearby location and good quality fuel- something they all believed was already being delivered by the industry’.
This meant their buying decisions were influenced by other factors – some wanted full-serve outlets like the old days, some chose a service station depending on whether it looked safe or not. ‘There were ten different segments with different needs, and we wanted a better understanding of each of these audiences.’
A focus group was set up for each segment; an anthropological study was carried out, which involved team members spending waking hours with people from each segment, watching them at home and accompanying them on shopping trips to see their buying habits; and a clinical psychologist was hired to create a psychological profile of each segment.
The study indicated that three groups, which comprised 30% of the driving public, should be targeted:
- Premium Speeders – outgoing, ambitious, competitive and detail oriented. They drive upmarket cars which make a statement* about them. Efficiency rules, plus fast pumps, quick access and payment.
- Simplicity Seekers – loyal, caring and sensitive, frustrated with complexities of everyday life want simple and easy transactions.
- Safety Firsters – control oriented, confident people, like order and comfort. Higher value on relationships and go out of their way* to stations that make them feel comfortable. Prefer to stay close to cars.
‘The common thread was that they all wanted a faster and easier service than anything already available,’ said Dave, ‘so the study ended and the lunch began.’
*an upgrade: making something work better, and do more
*to make a statement about somebody: to show what kind of person somebody is
*to go out of one’s way: to make an effort
*hassle: problems
The field organisation and Shell Oil retailers combined forces to determine how to eliminate the little hassles that customers sometimes face, such as improved equipment and clearer instructions at the pump. New innovations are currently being test marketed. A new advertising campaign was launched and a sophisticated measurement system introduced to monitor satisfaction, behavior and perception of the brand. ‘Fueling* a car is a necessity of life and I believe we are ahead of the game – but we won’t allow ourselves to stop and be caught up.’
*fueling (up) (US ) = filling up (GB)
1 Read the text again and number the different stages in the research project in the correct order.
a They analysed the results, which showed that there were 10 different consumer segments. ( )
b Focus groups studied the 10 segments. ( )
c Shell Oil’s marketing team decided to differentiate the Shell brand from the other brands on the market. ( 1 )
d Shell launched a new advertising campaign. ( )
e They interviewed 55,000 people about their attitudes to driving and cars in general.( )
f Work started on improving products and services. ( )
g They carried out a detailed study of the market over 18 months. ( )
h Three groups were chosen as the target markets. ( )
2 Match the words from the text with their corresponding definitions.
1 to exceed a a part or section
2 a mission b a group of interested people
3 an initiative c an important new plan with a particular aim
4 a segment d an assignment or task
5 an audience e to find out / to discover
6 a profile f to check at regular intervals
7 to determine g to be more than
8 to monitor h a description of the characteristics of someone or
something
3 Find words and expressions in the text which correspond to the following definitions.
1 Many different types of consumer who buy the same product
fragmented market__
2 The most advanced and up to date
c______e______
3 Conclusions people reach about which products to purchase
b______d______
4 An informal discussion group used for market research
f______g______
5 A shared characteristic
c______t______
6 A method of evaluation
m______s______
4 Complete the passage using words from exercises 2 and 3. Change the form of the words where necessary.
As more and more industries are marketing products specifically adapted to particular (1)segments of the market, market researchers are being asked to conduct studies and to compile more detailed (2)______of consumer groups. Broad classifications based on sex, age and social class are not sufficient for companies operating in highly competitive and (3)______. Questionnaires are carefully designed to (4)______the exact needs and demands of consumers as well as establishing what affects consumer (5)______when they choose one product instead of another. Advertising campaigns can then be targeted to appeal to the identified (6)______. Finally, marketing people must (7)______the success of the campaign and modify it if necessary.
Discussion
Consumers allowed Shell marketing people to ‘move in with them’ in order to observe their habits and routine. In pairs, discuss the questions.
1 What are the advantages of this type of research over more conventional data collecting processes?
2 Would you agree to participate (as a potential consumer) in this type of research? Why (not)?
3 Why do you think some people do accept?
4 People's attitudes to brands and marketing can be very different. Which of these statements do you agree with?