U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

UNIT 12: MARKETING

AIMS

- Consider the product life cycle and the role of marketing

- Discuss pricing and distribution strategies

LEAD-IN

Which definition do you prefer and why? (Coursebook/p.64)

I prefer the 3rd difination because it is not just easy that marketing is sell something or
something you made. It’s must research, analyze, understand what customers really
need then contribute to them

VOCABULARY: BASIC MARKETING TERMS (p.64)

distribution channel
(kênh phân phối)

market segmentation
(phân khúc thị trường)
product feature
(thuộc tính sản phẩm)
market opportunities
(cơ hội thị trường)
market skimming
(thị trường trượt giá)

sales representative
(đại diện bán hàng)

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

market penetration
(xâm nhập thị trường)
price elasticity
(co giãn về giá)
wholesaler

product differentiation

READING: THE PRODUCT LIFE CYCLE (p.65)

New vocabulary/phrase

level off to stop rising or falling and remain level

withdraw to take money out of a bank account

public awareness the public's level of understanding about the importance and
implications of a certain program or an activity
sales volume the number of units your company sells during a specific
reporting period
peak the pointed top of sth

economies of scales the advantages that can sometimes occur as a result of

increasing the size of a business
liquidate wind up the affairs of (a company or firm) by ascertaining
liabilities and apportioning assets.

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

Defend resist an attack made on (someone or something); protect

from harm or danger.
market share the portion of a market controlled by a particular company or
product.
aim at To plan sth

virtually nearly; almost.

innovator The pioneer in buy production

early adopter A man who really like one production and wait for new release
product to buy

DISCUSSION: PRICING (p.66)

Q1. Under what circumstances would manufacturers either set prices that try to
maximize profits, or deliberately charge a low price?

circumstance /ˈsɝː.kəm.stæns/ (n): a fact or event that makes a situation the way it is.

deliberately (adv): intentionally

Suggestion: price-skimming strategy vs. market penetration strategy

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Q2. Give examples of products for which demand is elastic, and which you would only
buy (or buy more of) if the price went down.

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

elastic /ɪˈlæstɪk/ (adj): relating to a situation in which the number of products sold
changes in relation to the product's price.

Suggestion: book, CDs, computer games, clothes, etc.

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Q3. Which products are for you not price sensitive, so that you would buy them even
if the price increased significantly?

price sensitive: A price-sensitive product is one whose sales are influenced by price
rather than quality.

Suggestion: essential needs (ex: food)

Find information about premium pricing, prestige pricing

Premium pricing is a strategy that involves tactically pricing your company’s product
higher than your immediate competition. The purpose of pricing your product at a
premium is to cultivate a sense in the market of your product being just that bit higher
in quality than the rest.

Prestige pricing is a pricing strategy that uses higher prices to suggest quality and
exclusivity. This practice is commonly seen among luxury brands and fine restaurants.

While establishing a higher price for your product can make it seem more exclusive and
high quality, if you don’t have anything special or unique about your product then this
can backfire by attracting fewer customers.

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

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Q4. If you see a price that is a little less than a round number, e.g., $1.99 or €99.95,
does it makes you think of the lower number, e.g., $1 instead of nearly $2, and
encourage you to buy the product? If not, why do you think most retailers use
‘psychological pricing’ or ‘odd prices’ like this?

Psychological pricing is the business practices of setting prices lower than a whole
number. The idea behind psychological pricing is that customers will read the slightly
lowered price and treat it lower than the price actually is. An example of psychological
pricing is an item that is priced at $3.99 but conveyed by the consumer as 3 dollars and
not 4 dollars, treating $3.99 as a lower price than $4.00.

Odd-even pricing is a psychological pricing strategy involving the last digit of a product
or service price, in the belief that certain prices or price ranges appeal to a certain set of
buyers. Instead of charging $20, charging $19.95 for a product makes the price appear
to be in the "teen ranges" rather than the "twenty ranges."

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Q5. When, as a customer, have you benefited from a price war when competitors
continually lowered prices, trying to get more business? What kind of companies with
price wars?

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

Price war: a situation in which different companies compete with each other by
reducing prices.

Suggestion: market leaders with a large amount of cash that win the price war.

Weak companies that involved in the price war will easily go bankrupt.

A loss leader strategy involves selling a product or service at a price that is not
profitable but is sold to attract new customers or to sell additional products and services
to those customers. Loss leading is a common practice when a business first enters a
market. A loss leader introduces new customers to a service or product in the hopes of
building a customer base and securing future recurring revenue.

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DISCUSSION: DISTRIBUTION CHANNEL (p.66)

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

Link for further reading – Distribution channel:

https://www.investopedia.com/terms/d/distribution-channel.asp

The first channel is the longest because it includes all four: producer, wholesaler,
retailer, and consumer. The wine and adult beverage industry is a perfect example of
this long distribution channel. In this industry—thanks to laws born out of prohibition—
a winery cannot sell directly to a retailer. It operates in the three-tier system, meaning
the law requires the winery to first sell its product to a wholesaler who then sells to a
retailer. The retailer then sells the product to the end consumer.

The second channel cuts out the wholesaler—where the producer sells directly to a
retailer who sells the product to the end consumer. This means the second channel
contains only one intermediary. Dell, for example, is large enough to sell its products
directly to reputable retailers such as Best Buy.

The third/final channel is a direct-to-consumer model where the producer sells its
product directly to the end consumer. Amazon, which uses its own platform to sell
Kindles to its customers, is an example of a direct model. This is the shortest distribution
channel possible, cutting out both the wholesaler and the retailer.

Quote (p.66)

“On the other hand, eliminating the middlemen would result in lower costs, increased
sales, and greater consumer satisfaction; on the other hand, we’re the middleman.’

Your example:

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

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1. What are the four components of a distribution channel?

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2. What happened in direct distribution and in an indirect distribution?

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3. What is the purpose of a distribution channel?

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READING: MARKETING IS EVERYTHING (p.67)

sales-driven

customer driven

figure out

orient

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

gravity

pervasive

falsify

integrate

catch up

absorb

fatal

fixtate

agenda

mentality

absorb

Questions 1-10 (p.68)

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

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LISTENING 1: PROMOTING A JUICE BAR

Track 1.25: Listen to Melissa Glass explaining how Zeste tried to promote their juice
bar and answer the questions (read the questions and highlight the keywords)

1. What was the first form of marketing (or promotion) they tried?

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2. Why were they sure it would work?

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

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3. What concept was used for the advertising campaign, and what was the problem
with it?

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TAPESCRIPT (Track 25)

MELISSA GLASS

After the (1) ………………… of Zeste in Lausanne, in the beginning, as I said, it was quite (2)
…………………, we looked at different ways of (3) …………………………………, we looked into
different (4) ………………………………. The first, the first tactic on Lausanne was just (5)
………………, we did sampling on the street, we, I sent out one of my staff members with
little (6) ………………………, and people, little cups, and people then got to try our product,
and I knew that if they tried our product they’d be happy – our product sells itself as far
as taste. That was quite (7) ………………, but at the time we launched in October, so we
were going into winter, again as I said before, the (8) ……………………… was less, so then
we decided what we were going to do was some sort of (9) …………………………………,
something (10) …………… to get, to (11) …………… the people that, that hopefully they
would come. This unfortunately was a very (12) …………………………………. We went
through a (13) ………………………, we designed (14) ……………… to go into the (15) ……………,
because the bus actually (16) ………………………… in front of our store. We saw the people
in the bus, they didn’t know who we were, what we did, and we, I felt we needed to
touch these people. So, we did a (17) ……………………………………, which was rather (18)

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

…………………, to pay the time in the bus, also the production of the design of the, the (19)
…………, and also the (20) …………………………………. We went with the concept of having a
(21) ……………………… with (22) …………………………, with the theme of ‘Get a, get a kick out
of your vitamins and come to Zeste.’ Unfortunately, what we realized wasn’t on the (23)
………………… was enough information about the product, because the Swiss didn’t know
at that stage what a smoothie was. For them, this word didn’t exist, so it wasn’t a (24)
………………………………….

New vocabulary/new phrase

a planned method for achieving a particular result.

the activity of providing or trying a small amount of a product so

someone can decide whether to buy it.
a container from which a drink, especially wine, is drunk, usually
made of glass or metal, and with a stem and a base but no
handles.
people who are walking, not driving cars or riding bicycles.

something such as a picture, photograph, or piece of film used to

give a particular effect or to explain something.
to influence someone or something emotionally, or cause feelings
of sympathy in someone.
a planned series of activities that are intended to achieve a
particular aim.
a business that provides a service to other people or
organizations.

a small piece of paper advertising a product or event, which is

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

given to a lot of people.

a few sheets of paper folded together to form a thin magazine
that contains information or opinions about something.

LISTENING 2: THE MOST EFFECTIVE FORM OF PROMOTION

Listen to Melissa Glass talking about a successful form of promotion and answer the
questions.

1. According to Melissa, what is the most effective form of promotion?

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2. Does it have a temporary or a permanent effect?

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3. Why do you think this form of promotion works better than advertising?

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TAPESCRIPT (Track 26)

MELISSA GLASS

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U12 HANDOUT E4BS Lecturer: Nguyen Thao Trang

The most effective thing we’ve found is (1) ………………… in the papers, and in general
free publicity, so my partner spends a lot of time (2) ………………………………………, papers
like the, the free ones in the morning, and trying to get (3) ……………………… when we
have a new product or something hip, or something changes. They’re often (4) ………… to
have new things, or new (5) …………………………………. That then (6) ……………………………
straight away that day and people tend to take … the effect is (7) …………………. Those
articles don’t have an effect a week later in general, but it has the effect that day or the
next day and the idea is behind this for us is that we then (8) ……………… that (9)
……………………………… and the (10) …………………………………, and that they will (11)
……………………… because of that.

New vocabulary/phrase

the attention that a person, product, or organization receives

from newspapers, television, etc. when something happens that
people are interested in.
happening or done without delay or very soon after something
else.
to cause someone to believe something or to do something.

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