Marketing: Creating and Pricing Products

1. Marketing

Marketing is the process of planning, designing, pricing, promoting and distributing ideas, goods and services, in order to satisfy customer needs, so as to make a profit. 

2. The Main Factors Affecting the Size of a Product's Target Market

►  characteristics of the human population, such as age and income levels;

►  geography. For example, the demand for spicy foods is higher in southern china than in other areas;

►  economic factors, such as economic growth. During a recession, firms may promote necessities rather than specialty products;

►  changes in social values, such as a decline in demand for products perceived to be unhealthy.

3. The Main Steps Involved in Creating a New Product

►    develop a product idea, which may be in response to changes in consumer needs or preferences;

►    assess the feasibility of the product idea, which entails comparing the expected benefits with the costs of the product;

►    design the product and test it with some consumers in the target market;

►    distribute the product so that it is accessible to the target market, and promote the product to ensure that consumers are aware of it;

►    post-audit the product to determine whether the product needs to be revised in any way.

4. Some Common Methods Used to Differentiate a Product

►    unique design, in which the product produced is safer, more reliable, easier to use, or has some other advantages;

►    unique packaging, which can enhance convenience or contain advertising;

►    unique branding, which may enhance consumers' perception of the product's quality.

5. The Key Factors that Influence the Pricing Decision

►    cost of production, so the price charged can recover costs incurred;

►    inventory supply, so the price can be lowered to remove excess inventory;

►    prices of competitors, so the price may be set below those of competitors to gain an advantage (penetration pricing) or above those of competitors to create an image of high quality(prestige pricing).

6. Other Pricing Decisions

►    discounting, which involves deciding whether to give discounts to specific customers;

►    sales prices, which entails deciding whether to put some products on sale for all customers periodically, and what the sales price should be;

►    credit terms, which involves deciding whether to provide credit to large customers that buy the product in bulk, and what the credit terms should be.

Day1: Marketing: Creating and Pricing Products

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词书地址：BEC中级15天冲刺特训

直击考点：

►  考查快速阅读能力；

►  考查通过扫读获取细节信息的能力；

1、快读阅读题干和文章标题，了解文章大意

例：

 这篇文章的标题是“企业兼并与收购”， 副标题是VKT的财务总监Maynart负责过很多次成功的收购，由此可以推测，文章讲的可能是Maynart对企业收购的建议。

2、看选项，划出关键信息

关键信息可以帮助考生更好的把握句子大意，提升做题速度。所谓关键信息，是指最能表达句子核心含义的那2-3个词。从词性上来讲，关键信息可以体现在动词，名词，形容词，副词这些实词上，同时，关键信息是句子中包含的新信息。例如，在这个句子中There is evidence that the use of offshoring will increase.，显然There is evidence并不是关键信息，而句子要表达的核心含义是offshoring will increase。

3、分段浏览原文，进行信息匹配

采取扫读的方法，快速浏览原文，分清每段的论点和论据，论点句一般是段落的首句。每阅读完一个段落后，即要对照选项，进行信息匹配。做题过程中注意以下几点：

►  每个段落对应两个选项，包含example的段落，对应一个选项；

►  一般来说，选项会和段落中的某一句话相对应，有时也会需要结合段落的两三句话或整个段落做判断，但这种情况比较少见；

►  段落中如出现转折词（e.g.：but，instead，nevertheless），通常是前面一处考点，后面一处考点；如果段落有两个意义层次，可能会一个层次出现一个考点；

►  做出一道题，就在旁边标上答案，逐步缩小选择范围，有利于做判断。

一起来做个小练习吧!

NO.1  Matching

1. the failure of a company to set its prices appropriately

2. a context that makes it difficult to increase prices

3. the consequences of companies trying to conceal their approach to pricing

4. the means by which a company ensured precision in the prices it offered

5. the fact that companies can learn about the effects of a price reduction

6. the first sector to price products according to how much customers were prepared to spend

7. the widespread use of rough guidelines to determine prices

Getting the price right

A.

Chief executives need to pay more attention to pricing, according to Roberto Lippi of the Apex Group, a consultancy that offers advice on pricing strategy. He accepts that low inflation figures in many industrialised countries makes raising prices tough, but argues that this should not necessarily deter companies. He gives the example of the airlines, which, with their minimum stay requirements and massive premiums for flexibility, led the way in sorting customers into categories, based on their willingness to pay. 

B.

The key to pricing is to avoid alienating customers. As Lippi points out, once a bad price has been established, it can be very difficult to turn the situation around. He gives the example of a consumer goods company that went bankrupt largely because it did not price its digital cameras properly. In contrast , he cites the case of a Swiss drug company that introduced software for every sales representative's laptop, enabling them to provide consistent and accurate price quotes. To help staff with this innovation, the company also created a new post of director of pricing strategy.

C.

Many of today’s managers have the benefit of modern technology to help them with pricing. Supermarket chains, for example, can easily track customers' 'elasticity' — how their buying habits change in response to a price rise or a discount. But although a company can now measure this sort of thing in a more sophisticated way, following basic rules is still the most common way of setting prices. Most bosses still worry more about their costs than the prices they charge; one recent survey found that they spend as little as 2% of their time on pricing.

D.

One popular approach to pricing is illustrated by the car companies that charge extra for product add-ons such as electric windows, instead of offering them as part of the standard price. Although many customers are prepared to pay extra, Lippi recommends that companies make sure that price differences reflect real differences in the product, either in quality or in the extra service on offer. The worst approach is to try to keep the pricing structure secret from customers. Nowadays, that is more likely to lead to lost contracts than large profits. 

NO.2   Which phrase has the opposite meaning of "penetration pricing"?

A. discounting price

B. list pricing

C. prestige pricing

NO.3   What are the main steps involved in creating a new product? Sequence the following steps.

A. assess the feasibility of the product idea

B. post-audit the product to determine whether the product needs to be revised

C. design the product and test it

D. develop a product idea in response to changes in consumer needs or preferences

E. distribute and promote the products

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