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features that match the shoppers’ preferences. These will be stored on the company's computers.

The biggest obstacle to the Net is the keyboard. Voice recognition will make it obsolete. The consumer will access the network from anywhere - from home, the car, or perhaps even from a pair of glasses.

The consumer will say, ‘I’d like to buy a red sweater today, something in the $25 to $30 range.’ The network will take that request, along with any other historical preferences the consumer has - such as size, style and fabric. It will assemble a range of options at different prices from a variety of stores. All in the consumer's exact size. Then the consumer will be able to virtually try on the different sweaters using a 3D model of herself stored in the computer. And that is real e-commerce.

2. The words and phrases a-h are from an article on the future of e-commerce. Match them to the explanations 1-8.

a to comparison shop b catalogue shopping c voice recognition d a keyboard

e a range of options

f historical preferences g to virtually shop

h to try on

1 to compare the products offered by different suppliers 2 the thing you use to type text into a computer

3 to see if clothes fit you and suit you 4 to buy things online

5 information based on past customer choices

6 a system where customers buy by post

7 a number of different choices

8 a system where a computer understands spoken

3. Complete the sentences below with the vocabulary items in 2. Each sentence expresses an opinion. Do you agree?

a They should completely redesign the computer _______. It's uncomfortable and badly organised.

b I would never buy a suit online. I love going to shops and having the opportunity _______ clothes and feel the quality of the material.

c _______ may be popular in the USA but nobody buys things that way in my country.

d I don't like the idea of ______. I feel silly talking to a machine and it probably wouldn't understand me well.

e I never have time ______. If I see something I like, I usually buy it on impulse.

f I think I will always prefer to go to a high street clothes store than ______.

g I like shopping in big shopping centres because they offer ______ that small shops can't compete with.

h I object to the way some websites leave ‘cookies’ on your computer which record your _______ from previous visits.

VOCABULARY THROUGH THE CONTEXT

E-commerce: after boom and bust

Old economy, new economy

In the late 1990s companies raised vast amounts of money from investors for e-commerce Internet sites, both business-to-consumer (B2C) and business-to- business (B2B). B2B, where businesses obtain supplies using the Internet, is also referred to as e-procurement.

Commentators talked about the old economy, with companies doing business in traditional ways, and the new economy, with companies doing business over the Internet. This was the dotcom frenzy, the period of large numbers of Internet start-ups, many promising riches for investors, some of whom believed that the usual laws of economics no longer applied. However, most of the sites from that time have now disappeared.

B2C

In business-to-consumer e-commerce, sites were set up selling everything from pet food to clothes. Among the survivors, there are companies like Amazon, pure-play (exclusively) online sellers, with no traditional shops - no bricks-and- mortar outlets. This is pure e-tailing.

Other retail organizations are clicks-and-mortar ones, combining e-commerce with sales through traditional outlets. Some old-economy companies, like the UK supermarket group Tesco, use e-commerce in conjunction with its existing operations - it did not have to invest in a whole new expensive infrastructure of new computer systems, warehouses, etc. to take care of its e-fulfilment, processing and delivering orders.

B2B

In business-to-business e-commerce, groups of companies can set up public exchanges. For example, the Worldwide Retail Exchange allows companies to bid to supply participating retailers in a reverse auction on the Internet - the supplier offering the lowest price gets the contract.

There are also private exchanges, where a single company deals with suppliers in this way. Some companies prefer to use this form of e-commerce because they do not want to indicate their requirements to their competitors, thus revealing their current activities.

Both public and private exchanges are also referred to as e-marketplaces, trading hubs or trading platforms.

1. Match the two parts of these sentences.

1 B2B e-commerce can cut firms’ costs because 2 The company operates four e-commerce sites,

3 There was a huge temptation for me to follow the dotcom frenzy

4 Management theorists agreed that old-fashioned command-and-control management styles would not work

5 There has been a trend for investors to shift funds out of the technology, media and telecoms sectors

6 As the early web firms were addressing the business-to-consumer market,

a)the low prices they promised consumers meant that the scale of their business had to be enormous.

b)but I felt more comfortable investing in a fund whose core holdings are large multinationals.

c)it reduces procurement costs, both by making it easier to find cheapest supplier and through efficiency gains.

d)selling books, CDs, DVDs and computer games.

e)in the new economy, where creativity and innovation are everything.

f)back into old economy companies such as oil and car producers.

2. Complete the sentences with appropriate forms of vocabulary expressions.

1 Retailer A sells clothes in shops and also over the Internet: it has _____ -

____________ outlets.

2 Retailer В sells books and CDs on the Internet and has no shops: it has no

______- _______-______ ______, so it's involved in ______ ______- _______.

3 Retailer В has built massive warehouses and developed sophisticated computer systems: it has invested in the _______ necessary for _______-_______.

4 Household goods manufacturer С has set up a _______ _______ where it asks for bids from suppliers.

5 Defence companies D, E, F and G have got together to form a ______ ______

in order to get competitive bids from a range of suppliers.

6 Suppliers to D, E, F and G submit prices for particular projects in a ______

______, and the supplier offering the lowest price wins the contract.

7 Manufacturer С and Companies D, E, F and G run different kinds of _____-

_______. (three possible expressions)

READING 2

1. a) What's the difference between a ‘bricks and mortar’ and an ‘online’ retailer? Can you give an example of each?

b) What do you know about these companies: Amazon, eBay, Sears Roebuck?

Internet shopping - the sequel

By Neil Buckley

Pets.com; Webvan; Boo.com. The road to the online retailing future is littered with

ago. Apart from Amazon and eBay - the web’s biggest forum for buying and selling, though it is an auction house not a retailer -most of the biggest online retailers are not Internet start-ups but traditional shop or mail-order groups. Retailers have brought their investment capacity and trusted brand names to bear on Internet shopping – thus boosting public confidence. Many have integrated online sales into a ‘multichannel’ strategy that may link a website, shops and a mail-order catalogue.

‘There was a time when everybody said the Internet was going to steal purchases from shops. But the opposite is happening: multichannel retailing is the reality today,’ says Darrell Rigby, head of the global retail practice at Bain & Co, the management consultants. ‘Many classic bricks-and-mortar retailers actually started making money on their online operations long before Amazon did.’

A prime example of the fusion of the online and so-called ‘offline’ retail worlds is Amazon itself. The company has expanded well beyond its roots as a seller of books and CDs, acting as an online mall selling everything from gourmet foods to clothing. Evolving from pure retailer to 'retail platform', it now conducts its online commerce in partnership with bricks-and-mortar retailers such as Target, Nordstrom, Borders and Circuit City.

That blending of online and offline is offering consumers new ways to shop. They may research and order their purchase online, but have it delivered to a nearby shop - a service offered by retailers such as Sears Roebuck and Circuit City - so as to avoid delivery charges and allow them to see or try it on first.

Some of the biggest US retailers are developing integrated operations. JC Penney, the century-old department store chain, saw its Internet sales reach $600m last year. It offers 200,000 items that can be delivered to customers’ homes or any of its 1,020 shops.

Steve Riordan, a consultant at AT Kearney, says traditional retailers that have not yet embraced the online world face heavy investment and some tough choices. Are they 100 going to run online operations themselves or outsource them? Do they use the same sourcing model from the same factories? Do they have different distribution centres?

While the US still leads the way, it does not have a monopoly on successful Internet retailers. Tesco, the British supermarket chain, has the world's biggest online grocery business. It has helped Safeway, the third-largest US supermarket chain, set up its Internet operations.

The biggest e-commerce site in Japan is Rakuten, a home-grown online shopping mall that began life in 1997 with just 13 shops. Today, it has more than 10,000 and a share of the e-commerce market three times bigger than secondranking Yahoo Japan, according to a report by JP Morgan.

Some pure Internet retailers are also continuing to grow. Yoox.com - which sells end-of-season and exclusive goods from designers such as Armani, Prada and Dolce & Gabbana - has proved that designer labels will sell online and those European e-tailers can succeed internationally.

It chose to launch in Europe first, close to the designers whose goods it sells. Yoox now sells in seven languages to 25 countries in Europe, North America and Japan. Its stylish site – which it calls an ‘e-concept store’ - enables shoppers to ‘zoom’ in on clothes and see them from different angles, and includes video and music.

Federico Marchetti, the Italian former investment banker who is Yoox’s founder and chief executive, says that anyone selling online does not just have to get the technology and orders right. They also have to provide fun and entertainment. ‘What we have been trying to do with Yoox is build a very nice customer experience,’ he says. ‘The online retailer always has to be doing something interesting and different.'

From the Financial Times

2. Match the summaries below to the first six paragraphs of the article.

a)People mistakenly thought that Internet sales would take sales away from traditional stores.

b)A large number of Internet companies were unsuccessful.

c)A well-known American retailer is getting an increasing amount of revenue from online sales.

d)The largest online sellers are well-established businesses.

e)Consumers are taking advantage of the new partnerships by shopping online but using traditional retailers to collect their goods.

f)Some well-known Internet companies have joined with established companies to sell a wide range of products.

3.Now read the rest of the article and answer the questions below.

1 What issues should traditional retailers consider before going online?

2 What facts show that a) Tesco and b) Rakuten have been highly successful in selling online?

3 According to Federico Marchetti, what do Internet businesses need to do to be successful?

4.Match the following word partnerships.

Write a short magazine article about retailing. The notes below will help you.

∙Begin with a description of a current situation.

∙Add two paragraphs describing advantages and disadvantages of home chopping and traditional shopping.

Home shopping & Traditional shopping

40% shoppers interested in weekly delivery service for foodstuffs and household goods

75% like stores open early & late

Many supermarkets planning catalogue/home delivery/electronic ordering

Consumer protection difficult to regulate on the Internet Many traditional shoppers happy with current situation Traditional shopping – can see, touch, smell the goods Going to the shop – buy goods, have the goods immediately TV shopping and Internet shopping popular

Project work: You have been asked to prepare and test a questionnaire that will be used in a consumer survey of customers of a chain of retail bookshops. The questionnaire will be used in interviews with customers to collect the following information:

∙customer profile

∙customer satisfaction

∙attitudes to mail order and e-commerce

In pairs prepare the questions to include in your survey, covering these areas:

Marketing is often defined as a matter of identifying consumer needs and developing the goods and services that satisfy them. This involves developing the right product, pricing it attractively, and making it available to the target customers, by persuading distributors and retailers to stock it. But it is also necessary to inform potential consumers of the product's existence, its features, and its advantages, and to persuade them to try it. There are generally several stages involved in a consumer's decision to buy a new product. A well-known acronym for this process is AIDA, standing for Attention, Interest, Desire, and Action. According to the familiar ‘4 Ps’ formulation of the marketing mix - product, price, place and promotion - attracting attention, arousing interest and persuading the consumer to act are all part of promotion. Marketing textbooks conventionally distinguish four basic promotional tools: advertising, sales promotion, public relations, and personal selling, which together make up the marketing communications mix.

For consumer goods, the most important tool is generally advertising. As well as advertising particular brands, companies also carry out prestige or institutional advertising, designed to build up the company’s name or image. Advertising is often combined with sales promotions, such as free samples, coupons and competitions.

For industrial goods, particularly specialised ones, the most important tool is often personal selling. Sales reps can build up relationships with company buyers, and can be very useful in persuading them to choose a particular product.

The fourth promotional tool is public relations (frequently abbreviated as PR): activities designed to improve or maintain or protect a company’s or a product’s image. Public relations includes things like company publications, most notably the annual report, sponsorship, community relations programmes, the lobbying of politicians, and the creation of news stories, all designed to get publicity for the company or a particular product. Unlike paid advertising, publicity is any (favourable) mention of a company's products that is not paid for, in any medium received by a company’s customers or potential customers. Companies often attempt to place information in news media to draw attention to a product or service. Quite apart from financial considerations, the advantage of publicity is that it is generally more likely to be read and believed than advertising. It can have a great impact on public awareness that could not even be achieved by a massive amount of advertising.

Within the limits of their budget, marketers have to find the optimal communications mix of advertising, sales promotion, personal selling, and publicity, without neglecting the other elements of the marketing mix, i.e. the possibility of improving the product, lowering its price, or distributing it differently.

First Summary

Marketing involves making a good, cheap product and convincing customers to buy it by way of a good communications mix. For consumer goods' this is

generally done with advertising and sales promotions. For specialised industrial goods, this is done by personal selling. Publicity, such as favourable mentions of a company's products in news media, is also useful.

Second Summary

Marketing involves four basic elements: advertising, sales promotion, public relations, and personal selling. The first three of these are used for consumer goods, the last for industrial goods. These tools, along with product improvement, price reductions, and distribution channel innovations, makeup the communications mix.

Third Summary

Marketing involves producing the right product, pricing it attractively, making it available to potential customers, and promoting it. With consumer goods, this largely involves advertising and sales promotions. For industrial goods, personal selling is often more important. Publicity is also a useful tool as it is cheaper and generally more credible than advertising. Marketers have to combine these tools to create the best possible communications mix.

2.Look through the text again and answer the questions.

1.What are the main four groups of promotional tools?

2.What does the acronym AIDA stand for?

3.What does ‘4Ps’ mean?

4.What type of products is the personal selling used?

5.What is the difference between PR and publicity?

3. Classify the following 28 terms into four groups, according to which of the four major communications or promotional tools they belong to.