11. Read the text again and say which paragraphs discuss the following questions:

1. Why is it important to know the laws of marketing?

2. What’s the most essential thing in marketing?

3. Why is the term of perception important?

4. Can you give an example of the perception?

TEXT B

12. Read the text and give the summary of it. Marketing Laws: The Law of Duality

Early on, a new category of a product was a ladder of many rungs. Gradually the ladder becomes a two-rung affair.

In photographic film, it’s Kodak and Fuji. In rent-a-car, it’s Hertz and Avis. In hamburgers - McDonald’s and Burger King. In sneakers, it’s Nike and Reebok.

Back in 1969 there were three major brands of a certain product. The leader had about 60% of the market, the number 2 brand had a 25% share, number 3 brand had a 6 % share. The rest of the market included either private label or minor brands. The law of duality suggests that these market shares are unstable. Moreover, the law predicts that the leader will lose market share and number 2 will gain. Twenty- two years later, the leader dropped down to 45% of the market. The number 2 brand had 40% and number 3 had 3%. These products are Coca-Cola, Pepsi-Cola and Royal Crown-Cola, respectively, but these principles apply to brands everywhere.

Look, what happened in 1969. The Royal Crown Company revitalized its franchise system, 350 bottlers strong and hired the former president of Rival Pet Foods and a veteran of both Coke and Pepsi. The Company also retained Wells, Rich, a high-powered New York advertising agency. “We are out to kill Coke and Pepsi”, declared Mary Wells Lawrence, the agency head to the Royal Crown bottlers. The only brand that got killed was Royal Crown. In a maturing industry third place is a difficult position to be in.

Early on in a developing market the number three or number four positions look attractive. Sales are increasing. New, relatively inexperienced customers are coming into the market. These customers don’t know which brands are the leaders, so they take the ones that look more attractive. As time goes on, however, these customers get educated. They want the leading brand, based on the naive assumption that the leading brand must be better.

It’s another famous law of marketing.

Al Ries and Jack Trout

“The 22 Immutable Laws of Marketing”

GET TALKING

13. Read and act out the dialogue:

A: Our leather goods are unique, and I think, the best way to introduce them is by free direct mail, with pictures.

B: Well, I can’t say, I agree. I think radio spots will be more effective.

A: What about TV commercials?

B: Exactly! People usually buy what they see on TV.

A: Yeah. We can choose one product – and just promote it on TV.

B: I think we can go with several types of ads, one in a popular magazine, a short TV commercial and some flyers handed out on the street. Then we evaluate what works better and which is most cost-effective.

A: Okay, I will go along with that.

Notes:

TV commercials – телевизионная реклама

Free samples by mail - бесплатные экземпляры продукции по почте

Outdoor signs – реклама на улице

Radio spots – небольшая реклама по радио (от 10, 20, 30-секунд до минуты)

A flyer – одна страничка рекламы, раздаваемая на улице

14. Work in pairs. Take part in the discussion “How to win the market”:

Some people believe that the most compelling thing is the price. Others prefer quality and efficiency. But some people are motivated by a brand, company’s image. And what do you think of that? Prove your opinion.