Concept of Marketing

What does the term of “marketing” mean? Many people think of marketing as selling and promotion. In fact selling is only the tip of the marketing iceberg.

Marketing is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges that satisfy individual and organizational objectives. Marketing activities can be organized into seven functions:

Product/service management is designing, developing, maintaining, and improving products and services that meet consumer needs.

Distribution involves determining the best ways for customers to locate, obtain, and use the products and services of the organization.

Selling is communicating directly with potential customers to determine and satisfy their needs.

Marketing-information management is obtaining, managing and using market information to improve business decision-making and the performance of marketing activities. It includes marketing research and the development of data basis with information about products, customers, and competitors.

Financing is budgeting for marketing activities.

Pricing is setting and communicating the value of products and services.

Promotion is communicating information about products and services to potential customers. Advertising and other promotional tools are used to encourage consumers to buy.

Marketing planning is aimed at satisfying customer needs better than competitors do, resulting in sales and profits. A company’s plan that identifies how it will use marketing to achieve its goals is called marketing strategy. Developing a marketing strategy is a two-step process.

The first step is to identify a target market. Since no organization can satisfy all consumer needs, it must concentrate its efforts on certain needs of a specific group of potential customers. This is the target market. One of the advantages of target marketing is the possibility of becoming the leader in a specific market segment. Market segmentation involves aggregating prospective buyers into groups that 1) have common needs and 2) will respond similarly to a marketing action. As a consumer you are exposed to marketing activities all of the time. You take part in many of those activities. You see or hear advertisements. You see the brand names of products on packages and on the clothes that you and your friends wear. You interact with salespeople in stores, etc. A great deal of marketing is not even aimed at final consumers. Businesses also market products and services to other businesses which then use them in their own business processes or sell them to final consumers. This is the so called business- to- business market (B2B).

The second step in developing a marketing strategy is to create a marketing mix. A marketing mix or 4 ps is the blending of four marketing elements. They are as follows:

Product: a good, a service, or an idea to satisfy the consumer’s needs;

Price: what is exchanged for a product;

Promotion: a means of communication between the seller and buyer;

Place: a means of getting the product into the consumer’s hands.

To increase the chances of developing a product or service that meets customer needs and can be sold at a profit, companies carry out a marketing research. Marketing research estimates the demand for specific products and services, describes the characteristics of probable customers, and measures potential sales.Marketing research studies people as buyers and sellers, examining their habits, attitudes, preferences, dislikes, and purchasing power and almost every aspect of the seller-buyer relationship. It also investigates distribution systems, pricing, promotion, product design, packaging, brand names, etc.

The steps in marketing research are the following:

1. Define the marketing problem.

2. Study the situation.

3. Develop a data collection.

4. Gather and analyze information.

5. Propose a solution.

All marketing research studies involve gathering and analyzing information. A great deal of information about consumers and competitors is available to businesses without doing new studies. Analyzing existing information gathered for another purpose but used to solve a current problem is known as desk research or secondary research. Studies carried out to gather new information (primary data) specifically directed at a current problem are field research or current research. The most common types of marketing research are surveys, focus groups, observations, and experiments. Surveys gather information from people using a carefully planned set of questions. A focus group a (is a small group of consumers taking part in a group discussion of their experiences with a product or service. Observations collect information by recording the actions of consumers rather than asking them questions. An experiment presents two carefully controlled alternatives to subjects in order to determine which is preferred or has better results.

To implement a marketing program successfully, hundreds of detailed decisions are often required, such as writing an advertising copy or selecting the amount for temporary price reductions. These decisions, called marketing tactics, are detailed day-to-day operational decisions that must be taken right away.

Within the field of economics, two types of marketing are defined: micromarketing and macromarketing. The former describes the activities of individual firms, beginning with originating and producing products and ending when the products reach the final user, the customer. Macromarketing, by contrast, describes how the whole system of production and distribution works in a society. Marketing is not confined to profit-making companies that manufacture products. Doctors, lawyers, hospitals, colleges, museums, and other service enterprises also engage in marketing.

Vocabulary Focus

Ex. 1.

A. Study the meaning of the following words:

1. appraise (v) – fix a price for sth, say what sth is worth;

2. appreciate (v) – judge rightly the value of sth; put a high value of sth;

3. calculate (v) – find out by working with numbers;

4. estimate (v) – form a judgement about, calculate;

5. evaluate (v) – find out, decide, the amount or value of sth.

B. Choose the right word in italics:

1. Astronomers can calculate / estimate when there will be eclipses of the sun and moon.

2. I really appreciate/ estimate your efforts.

3. He was evaluated / appraised as unfit for military service.

4. The clerk appraises / calculates property for taxation.

5. I estimate / evaluate his income at $300.

6. You can’t appreciate / evaluate English poetry unless you understand its rhythm.

Ex. 2. Complete the table by inserting the missing forms if possible.

Ex. 3. Match the Russian words and word combinations with their English equivalents.

Ex. 4. Express in one word, use the words for reference:

– someone whose job is to persuade customers to buy a certain product or service;

– the breakdown of a market into separate and identifiable elements;

– budgeting for marketing activities;

– setting and communicating the value of products and services;

– the ultimate user of a product;

– activities or techniques intended to create consumer demand for a product or service;

– gathering information from people using a carefully planned set of questions;

– collecting information by recording the actions of consumers rather than asking them questions;

– the art of making people do what you want them to do;

– the provision of goods or services to meet customer or consumer needs.

Words for reference: consumer, financing, marketing, salesperson, segmentation, promotion, persuasion, pricing, observations, surveys

Ex. 5. Match the words in column A with their synonyms in column B:

Ex. 6. Fill in the gaps using the words given below. Some words are to be used twice:

1. Marketing is concerned with getting the right … to the right … at the right …

2. Marketing is about meeting customer … at a ….

3. Marketing makes it easier for … to do business with you.

Words for reference: customers; needs; place; price; product; profit.

Ex. 7. Insert the necessary prepositions:

1. Financing is budgeting … marketing activities.

2. Marketing planning is aimed … satisfying customer needs.

3. A business must concentrate its efforts … certain needs of a specific group of potential customers

4. The customers never respond similarly … a marketing action.

5. As a consumer you are exposed … marketing activities all of the time.

6. They managed to sell the products … a profit last year.

7. The demand … the products of their company is always very high. Their goods sell like hot cakes.

8. A great deal … information … consumers is available … our business even without doing any studies. … contrast, we know very little about our competitors.

Comprehension

Ex. 1. Match a type of data collected on the left with a research method on the right.

Ex. 2. Match two halves of the sentence.s

Ex. 3. Complete the sentences using information from the text:

1. Marketing is the process of …….

2. Marketing activities can be organized into seven functions ……..

3. Developing a marketing strategy is a two-step process. The first step is……….

4. The second step in developing a marketing strategy is ……….

5. Marketing strategy is ………..

6. Market segmentation involves ……….

7. A marketing mix is the blending of the following marketing elements: ……….

8. A marketing research is carried out to ………….

9. The steps in marketing research are the following: ……….

10. The most common types of marketing research are ……..

Ex. 4. Find information in the text to answer the following questions.

1. What is marketing? How does a marketing concept differ from a selling concept?

2. What are seven marketing functions? Comment on them.

3. What is market segmentation?

4. What is marketing strategy? Why is it called a two-step process?

5. How can you define marketing research? What are its steps?

6. What are the most common types of marketing research?