Questions:

1. What are some of the key reasons why an artist of the stature of George Clinton has problems getting a hit record at this stage of his career?

2. What specific market segments would you target to give new life to George Clinton’s career?

3. What marketing actions would you recommend to achieve the repositioning of George Clinton?

Text b Developing the Marketing mix

Once the company has decided on its positioning strategy, it is ready to begin planning the details of the marketing mix. The marketing mix is one of the major concepts in modern marketing. We define the marketing mix as the set of controllable marketing variables that the firm blends to produce the response it wants in the target market. The marketing mix consists of everything the firm can do to influence the demand for its product. The many possibilities can be collected into four groups of variables known as «the four P’s»: product, price, place, and promotion.

Product stands for the «goods-and-service» combination the company offers to the target market. Thus, a Ford Taurus «product» consists of nuts and bolts, spark plugs, pistons, headlights, and thousands of other parts. Ford offers several Taurus styles and dozens of optional features. The car comes fully serviced and with a comprehensive warranty that is as much a part of the product as the tailpipe.

Price stands for the amount of money customers have to pay to obtain the product. Ford calculates suggested retail prices that its dealers might charge for each Taurus. But Ford dealers rarely charge the full sticker price. Instead, they negotiate the price with each customer, offering discounts, trade-in allowances, and credit terms to adjust for the current competitive situation and to bring the price into line with the buyer’s perceptions of the car’s value.

Place stands for company activities that make the product available to target consumers. A product reaches customers through a channel of distribution. A channel of distribution is any series of firms (or individuals) from producer to final user or consumer.

Sometimes a channel system is quite short. It may run directly from a producer to a final user or consumer. Often it’s more complex, involving many different kinds of middlemen and specialists. And if a marketing manager has several different target markets, several channels of distribution might be needed.

Ford maintains a large body of independently owned dealerships that sell the company’s many different models. Ford selects its dealers carefully and supports them strongly. The dealers keep an inventory of Ford automobiles, demonstrate them to potential buyers, negotiate prices, close sales, and service cars after the sale.

Promotion stands for activities that communicate the merits of the product and persuade target customers to buy it.

Promotion includes personal selling, mass selling, and sales promotion. It’s the marketing manager’s job to blend these methods.

Personal selling involves direct communication between sellers and potential customers. Personal selling is usually face-to-face, but sometimes communication is over the telephone. Personal selling lets the salesperson adapt the firm’s marketing mix to each potential customer. But this individual attention comes at a price. Personal selling can be very expensive. Often this personal effort has to be blended with mass selling and sales promotion.

Mass selling is communicating with large numbers of customers at the same time. The main form of mass selling is advertising (any paid form of nonpersonal presentation of ideas, goods, or services by an identified sponsor). Publicity (any unpaid form of nonpersonal presentation of ideas, goods, or services) is another important form of mass selling.

Sales promotion refers to those promotion activities—other than advertising, publicity, and personal selling—that stimulate interest, trial, or purchase by final customers or others in the channel. This can involve use of coupons, point-of-purchase materials, samples, signs, catalogs, novelties, and circulars. Sales promotion specialists try to help the personal selling and mass selling people.

Ford spends more than $ 600 million each year on advertising to tell consumers about the company and its products. Dealership salespeople assist potential buyers and persuade them that Ford is the best car for them. Ford and its dealers offer special promotions—sales, cash rebates, low-financing rates—as added purchase incentives.

An effective marketing program blends all of the marketing mix elements into a coordinated program designed to achieve the company’s marketing objectives by delivering value to consumers. The marketing mix constitutes the com­pany’s tactical tool kit for establishing strong positioning in target markets. However, note that the four Ps represent the sellers’ view of the marketing tools available for influencing buyers. From a consumer viewpoint, each marketing tool is designed to deliver a customer benefit. One marketing expert suggests that companies should view the four Ps in terms of the customer’s four Cs:

Thus, winning companies will be those that can meet customer needs economically and conveniently and with effective communication.

Four Ps	Four Cs
Product Price Place Promotion	Customer needs and wants Cost to the customer Convenience Communication

All four Ps are needed in a marketing mix. In fact, they should all be tied together. But is any one more important than the others? Generally speaking, the answer is no—all contribute to one whole. When a marketing mix is being developed, all (final) decisions about the Ps should be made at the same time. That’s why the four Ps are arranged around the customer (C) in a circle—to show that they all are equally important.

Let’s sum up our discussion of marketing mix planning thus far. We de­velop a Product to satisfy the target customers. We find a way to reach our target customers’ Place. We use Promotion to tell the target customers (and middlemen) about the product that has been designed for them. And we set a Price after estimating expected customer reaction to the total offering and the costs of getting it to them.

І. Key terms:

Price — ціна — the amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service.

Promotion — просування — the specific mix of advertising, personal selling, sales promotion, and public relations a company uses to pursue its advertising and marketing objectives.

Advertising — реклама — any paid form of nonpersonal communication about an organization, goods, service or idea by any identified sponsor.

Lifestyle — стиль життя — a mode of living that is identified by how people spend their time and resources (activities), what they consider important in their environment (interests), and what they think of themselves and the world around them (opinions).

Marketing channel — канали маркетингу — people and firms involved in the process of making a product or service available for use or consumption by consumers or industrial users.

ІІ.  Vocabulary notes:

allowance, n.

1. sum of money, amount of sth., allowed to sb. — грошова допомога; утримання; кишенькові гроші; family allowance — допомога багатосімейним;

2. порція, пай, раціон; норма видачі; making allowance(s) for — allow for, take into consideration — поправка; виправдання; дозвіл, до­пущення; брати до уваги; allowance must be made for his age — remember that he is young, and not to be severe — слід зважити на йо­го вік;

3. deduction or discount — знижка; надбавка; advertising allowance — знижка (з ціни товару) з метою компенсації витрат на рекламу; cost-of-living allowance — підвищення ставок заробітної плати у зв’язку зі зміною індексу прожиткового мінімуму; promotion allowance — знижка (з ціни товару) з метою компенсації послуг із просування товару на ринок; tax allowance — пільги на податок; trade allowance — знижка роздрібним торговцям;

persuade, v.

1. convince — переконувати; persuade sb. that …; persuade sb. of sth.;

2. cause (sb.) by reasoning (to do sth.) — умовляти; схиляти;

3. cause sb. to do/stop doing sth. — persuade sb. into/out of (doing) sth.; from doing sth. — умовляти; відмовляти;

promote, v.

1. give (sb.) a higher position or rank — to promote (to) — просувати, висувати; підвищувати у званні (у чині); He was promoted colonel (to colonel; to the rank of colonel) — йому надали звання полковника;

2. help to organize and start; help to found or organize — сприяти, підтримувати; заохочувати; допомагати; спричиняти; засновувати (підприємство тощо); promote a new business company — засновувати нову комерційну компанію; promote a bill in Parliament — підтримувати законопроект у парламенті;

3. encourage by publicity, advertising, etc. — сприяти про­дажу товару; створювати сприятливі умови для продажу; просувати;

promotion, n.

1. promoting or being promoted — сприяння, підтримка, заохочення;

2. instance of promoting or being promoted — просування по службі; підвищення на посаді (в чині); win/gain/obtain promotion — дістати підвищення;

3. encouragement by publicity, etc.; advertising/ publicizing one’s product — сприяння в продажу; створення сприятливих умов для про­дажу; просування;

warranty, n.

1. authority — дозвіл, офіційна санкція; підстава, виправдання;

2. written or printed guarantee — гарантія, поручительство, порука; гарантія якості;

3. article in the contract which covers some conditions — умова, застереження;

incentive, n.

that which incites, rouses or encourages a person/incentive to sth./to do sth./to doing sth. — спонука, спонукання, стимул;

incentive, adj.

спонукальний, надихаючий; заохочувальний, стимулюючий;

inventory, n.

1. detailed list, e.g. of household goods, furniture, etc. — інвентаризаційний опис, відомість, перепис, інвентаризація, реєстр; список, каталог;

2. items included in the list — товари, предмети, внесені в інвен­таризаційний опис, наявні товари;

3. goods in stock — матеріально-виробничі запаси; annual inventory — інвентаризація в кінці року; inventory in stock — наявні запаси; buffer (protective) inventory — резервний запас; gross inventory — загальний запас; input inventory — запаси, що надходять; mean inventory — середній рівень матеріальних запасів; on-hand inventory — наявний запас; on-order inventory — замовлений запас; total inventory — загальний рівень запасів.

ІІІ. Answer the following questions:

1. What does the company do after it has decided on its positioning strategy?

2. What do you know about one of the major concepts in modern marketing?

3. How can it be defined?

4. What does Product stand for?

5. How do Ford dealers charge for each Taurus?

6. In what way does a product reach its customers?

7. Is a channel system short or complex?

8. What can you say about Promotion?

9. What does Promotion include?

10. Speak about advantages and disadvantages of personal selling and mass selling.

11. What promotion activities does sales promotion refer to?

12. How can the company’s marketing objectives be achieved?

13. What are the customer’s four Cs?

14. Are all four Ps needed in a marketing mix?

15. Sum up the discussion of marketing mix planning.