III.

11-20

Choose the correct word/phrase, and drag them to complete the blanks in the following text.

Best Buy, the electronics retailer, has become the first leading US retailer to start sending [[1]] and deals to
its customers’ smartphones when they walk into one of its stores. Best Buy store in San Francisco has
deployed a location-based marketing [[2]] developed by Shopkick.
Customers who [[3]] the Shopkick application on their phones will automatically receive “kickbucks” credits
just for entering the store that can be traded for benefits including gift cards, computer gaming credits or
music downloads. Best Buy will also use the system to send participants in its [[4]] promotionnal offers that
can be customised to reflect their shopping [[5]] and interests.
Richard Rommel of Best Buy said that “the convergence of location technology and rewards to [[6]]”
shopping was at the heart of their business strategy. Price [[7]] are then automatically deducted from the bill
at the store’s checkouts. The Shopkick application responds to an audio signal transmitted in the store. It is
far more accurate than GPS-based [[8]] which can be off by a few hundred yards, and which raise potential
privacy concerns because they are automatically activated.

Recent years have seen the emergence of a number of location-based systems with marketing [[9]] for social
networks. They allow [[10]] to offer credits or local promotions to phone users who actively “check in” to
locations such as coffee shops Instore mobile shopping applications are likely to become increasingly
important to retailers as they seek to close deals with shoppers equipped with smartphones that can search
and compare prices at rival stores and online.

IV. READING COMPREHENSION

Read the text below and choose the correct answer for each question that follows.

Not long ago, innovation was The Big Idea in marketing circles. Now, however, it's hard to see the benefits
of this rush to innovate. Indeed, if anything, companies seem to be drawing back from innovation, not
charging ahead. But just a few years ago many companies were combining a commitment to create entirely
new product categories through innovative technologies - working to hugely ambitious growth targets - with
a root-and-branch organizational overhaul designed to free up creativity and speed new product roll-outs.
            The result was that as resources were shifted away from core businesses, sales and profits faltered,
share prices slumped and CEOS were ousted. Now the mantra is a more conservative focus on the top
brands, the top retail customers and the top markets. It's being rewarded in many cases by healthier share
prices. This sustained effort to cut long tails of smaller brands and focus marketing resource on existing
leaders seems to be paying off.

            So, were we wrong to pinpoint key innovation as key to long-term market success? Surely not. But
we might have underestimated the enormous complexity of this beast. The term ‘innovation’ may be simple
enough but it spans a vast landscape, including the type and degree of innovation, marketing purpose,
management process and market circumstance - not all of which are well understood.

            Take ‘type’ of innovation. Are we talking about new products only? Or new processes, new channels,
underlying technologies, organizational structures and business models? When should the innovation involve
a new brand? Or take 'degree'. Are we aiming for blue-sky inventions that will transform markets and create
new categories? Or marginal tweaks in, say, formulation or packaging that give us an excuse to advertise
something ‘New! Improved!’? Likewise, is the marketing purpose of the project to steal a march on
competitors and drive incremental growth, or to update an obsolete product line and play catch-up to
competitors? As one business news editorial complained, ‘innovation’ is often just ‘simple proliferation of
similar products'. Then there's process. What is the best way to manage this particular innovation? Is it to
employ creative revolutionaries and set them free, or is disciplined risk management, requiring the careful
testing and sifting of options to pick winners, a better approach? In larger organizations, has senior
management really made time spent in cross-functional teams a recognized element of successful career
paths? What time frames (e.g. payback periods) and degrees of risk is senior management comfortable with?
And does the organization have a culture that fits the chosen approach? Does it ‘celebrate failure’, for
example, or is it actually a risk-averse blame culture (despite what the CEO says in the annual report)?
            Successful innovation requires clearing two hurdles. First, it needs the right project with the right
degree of innovation to fit with the right marketing purpose, the right innovation process, corporate culture
and market circumstance. Second, it needs senior managers that understand the interplay between these
different factors, so that rather than coming together simply by chance, they are deliberately brought together
in different ways to meet different circumstances.
II. 6-10
Match the following halves to make complete sentences.
 There are many advantages of online marketing including better brand engagement,
Answer 1
 Online retailers try to lure customers away
Answer 2
 A lot of people are not happy to receive emails
Answer 3
 The company’s plan involves choosing their target customers and designing
Answer 4
 The Board of Directors are aware of the company’s challenge which
Answer 5
I.1
Choose the correct word/phrase to complete the sentence below.
_______ is a type of marketing which encourages people to buy a product or service in a way that people are
not aware of this marketing strategy.

Viral marketing

Stealth marketing

Paid marketing

Marketing mix
I.2
_______ is the process of advertising and selling products and services on the Internet, for example, on a
company website or by email.

E-business

E-banking

E-marketing

E-commerce
I.3
The key factors that are involved in the marketing of a good or a service are Product, _______, Place, and
Promotion.

Power

People

Plan

Price
I.4
A company which only has online stores is known as _______.

e-commerce

e-retailer

e-shop

e-businessman
I.5
A(n) ______ refers to a company which has both online and high-street stores.

multi-channel marketing

e-marketing retailer

bricks-and-clicks operator

pure play retailer
IV. 21
According to the first paragraph, a few years ago companies _______.

trusted in technology to improve exsting products.

chose to focus heavily on marketing activites.

expected that growth would increase steadily.

believed they needed to produce new goods.
IV. 24
According to the fourth paragraph, companies should ensure that _______.

their approach to risk management is fully new.

the progress of an innovation is as speedy as possible.

their new products are radically different from competitors’.
 
the benefits of participating in teamwork are fully acknowledged.
IV. 25
What is suggested in the fifth paragraph?

The steps involved in innovation must be tackled in sequence.

Market forces should be a company's primary consideration.

The types of innovation sought must be appropriate to a company.

Elements of chance should be assumed in decision-making.
IV.22
What problem is indicated in the second paragraph?

Insufficient attention to brand identity damages company profits.

A lack of product diversity reduces a company's appeal.

Business leaders are not attracted to slow-performing companies.

Slow reactions to business trends reduce investors' interest.
IV.23
According to the third paragraph, it would be a mistake to _______.

rely on future benefits in business planning.

deny the benefits of pursuing innovation.

neglect the importance of strategic issues.

predict the outcomes of innovations.

I.

Read the following sentences and choose the best answers.

III

  Read the text below and choose the correct answer for each question that follows.

A manufacturer of sports shoes starts selling consumer electronics. A soft drink lends its name to a range of
urban clothing. What’s going on? In simpler times, you knew where you were with brands. One brand name
meant good- quality sports shoes, another a soft drink. No confusion. Today, however, big companies try to
redefine brands as not so much a product, more a way of life, and stretch them into new areas. In the early
years of the consumer society, a brand name on a box simply identified what was inside. People were
looking for products that would improve their quality of life, and chose brands most likely to achieve that
purpose. But as people in industrialized nations became more affluent and fulfilled their basic needs, brands
acquired other attributes. The functionality of the product was still important, but people also started using
brands to say something about themselves, for example, choosing a brand of cosmetics which would suggest
that they were sophisticated jet-setters.
            Now, we have entered a third age of branding, in which so many companies are making roughly the
same product at roughly the same price that functionality rarely succeeds as a point of differentiation.
Instead, companies are trying to make their brands stand out by emphasizing their emotional aspects, hoping
consumers will identify with the set of values the brand represents.
            One disadvantage of a product-based brand is that if the product goes out of fashion, the brand goes
with it. This is a serious concern for manufacturers of breakfast cereals, who are struggling to counter weak
demand for the products that bear their names. So far, their marketing efforts seem to be having little effect.
The advantage for emotional brands is that companies can transfer their brand strength into other areas,
increasing revenues and reducing their exposure to the lifespan of a single product.
            The elasticity of brands seems to be related to their position on a spectrum ranging from those rooted
in solid, tangible assets to those with highly intangible, emotional qualities. At the one end, you have train
companies that tend to associate themselves with infrastructure and their ability to get you from A to B, and
at the other end would be a leisure brand that positions itself on dreams and making people have fun. It is the
latter which has the maximum potential for stretch.
            But even emotional brands have a limit to their elasticity. The merchandise has to be consistent with
the brand promise. Just to sell merchandise with your logo on it is a short-term, mistaken idea. From this
viewpoint, the decision to move from sports shoes into consumer electronics makes sense. Most items in the
range, such as the two-way radio for hikers, are sports-focused, even though the products may be adopted as
fashion accessories, and the sports shoe customers will probably snap them up.

II.1

Fill in each blank with one suitable word/phrase. You don’t need to use all the words provided.

mismatches effects trades unexpected

match target adopted trading
discourage associated making manage

Companies spend large amounts of money researching (1){#1} markets and developing their brand image
but once the product has entered the marketplace, the (2){#2} can happen. The company’s advertising may
target one type of user, but this might not (3){#3} the people actually seen with the brand. A recent example
of this occurred with Burberry, the clothing label. It was marketed as a luxury brand but became (4){#4}
with working class Britons. ‘

Clashes of this kind are not easy to (5){#5} Occasionally the company may try to welcome the unexpected
customers by changing the brand’s image. However, this can have far reaching (6){#6} on everything the
company sells. Most companies are not willing to risk their whole product range like this. Another strategy is
to raise the price in order to (7){#7} unwanted users. Or they may even decide to discontinue product lines
where there is this clash. This last solution was (8){#8} by Burberry when they stopped selling their baseball
caps.

Globalization is likely to both help and exacerbate the problem. On the one hand, a local clash might not
matter much if you are selling in many different markets. But at the same time, (9){#9} like these are likely
to become more common when a product is marketed across different societies.

It is probably best for companies to anticipate the problems before it occurs. One way to do this is to (10)
{#10} the brand so that different groups are targeted. Armani, for example, offers both premium and more
commercial products under the same brand name. In addition, a brand needs to manage its retail outlets
carefully and check that the point of sale is in harmony with the product image. Any stockist who does not fit
this should probably be dropped.
II.2

Choose the best answer to complete each blank in the following text.

In New York, people are always asking me the same question," Alexandre de Lesseps says: ‘Why do you
want to (1){#1} money to poor people in developing countries?’ Mr de Lesseps, an international investment
banker, has a ready answer, "The only way to solve the problems of (2){#2} and terrorism in the world
today," he says, " is though investment." As a co-owner of BlueOrchard Finance, a (3){#3} bank in Geneva,
he is one of the leading figures in the world of microfinance. His firm manages a fund that currently makes
about $50 million in short-term (4){#4} to microcredit lending institutions in more than 20 developing
countries around the world, and BlueOrchard and its investors make a profit in the form of (5){#5} payments
on the loans that they make to such institutions. Micro-finance institutions typically make loans in (6){#6} of
$1,000 or less to poor people in developing countries who are ignored by commercial banks. As a rule,
microcredit loans are not (7){#7} by collateral, leaving no means of financial recovery for the lender if they
are not repaid. But leading microcredit (8){#8} claim that only five per cent of the loans they make are never
repaid. This compares with five to ten per cent in the consumer finance industry for borrowers with bad
credit (9){#9}. Just less than $500 million is committed to microcredit loans worldwide, according to
BlueOrchard's estimates. But Mr de Lesseps says he believes that today the total (10){#10} for such loans
may be nearly $3 billion.

III.1-5
1. What led to a change in attitudes to brands? - the personal {#1} of consumers
 
2. According to the writer, an attribute of the third age of branding is that {#2} products may serve their
purpose equally well.
 
3. The writer mentions manufacturers of breakfast cereals to illustrate how {#3} in the popularity of products
can cause difficulties.
 
4. The writer refers to railways to show that brands like this are {#4} to lend themselves to stretching.
 
5. The writer argues that the stretch from sports shoes into consumer electronics is likely to be successful
because there is a {#5} in the way that the goods can be used.

I.1
If all consumers were to have a sudden lapse of memory and forget everything related to a company, the
company would _____.

go on business

go into business

go out of business

go over business
I.10
A current bank account pays little or no interest to the holders. It allows the customer to _____ their money
at any time.
 
attract

manage

access

open
I.2
The use of an established brand name with a different product is known as _____.

brand extension

brand equity

brand positioning

luxury brand
I.3
   _____ is leased to a manufacturer, who then makes the product under that name.


A brand product

Licensed brand

Own brand

Brand extension
I.4
A _____ is simply anything that satisfies customer needs, it has a functional value, a utility that hopes to
satisfy our needs as consumers.


brand

product

trademark

brand positioning
I.5
Although products are manufactured, brands are sold and constitute important elements that guide _____.


consumer behavior

retailer behavior
 
customer point of view

customer profile
I.6
_____ banking services include current accounts, savings accounts, credit facilities, insurance and the ability
to transfer funds across borders.


Traditional

High

Luxurious

Low-income
I.7
Microfinance is considered a tool for _____ development and is not part of the charitable network.


socio-economic

socio-environmental

socio-cultural

socio-payable
I.8
A person is a 'known risk' when he/she has a _____ of previous borrowings, and so will be categorized as a
low risk compared to people with no assets or credit history.


historical credit

credit history

credit loan

credit limit
I.9
Default means the borrower become _____ and cannot repay the debt.  


unsolvent

insolvent

insolvency

discretion