Unit 7: Imperfect Competition

     In perfect competition no single firm controls prices. There are no barriers to entry or exit. All firms sell the same products and services. They all have the same industry knowledge and there is a large number of the suppliers and buyers. If any of these conditions is absent it is an imperfect competition.

   Imperfect competition presents several different forms. In a monopoly only one seller exists. For example, a drug company offering a medicine that has no substitute.

   In an oligopoly there are many buyers but only a few sellers. Smart phones and other high-tech industries are  examples of oligopolies.

 Monopolistic competition exists when many sellers offer similar products for many buyers. Fast-food restaurants feature monopolistic competition by creating similar products that are not perfect substitutes.

  In a monopsony there are many sellers of the product but only one buyer. The US defense industry is a monopsony. Many firms create products that they try to sell to the US military.

     An oligopsony has only a few large buyers for a product. A tobacco industry exemplifies an oligopsony. A handful of large cigarette companies buy almost the entire annual tobacco crop.

  Realistically perfect competition is only a theory because every industry has some form of imperfect competition. Markets are valued by how they compare to and try to approach perfect competition.

Unit 8: Marketing

     Marketing is the name given to a number of activities used by the companies to increase their sales. These include virtually all the activities in which a company product or the communication come in contact with its potential customer. Marketing creates and uses these moments of contact to communicate the benefits of the product in a hope to convince a customer to make a purchase.

   Basics of marketing are often summed up as the four “P”s.

1. Product. The marketing department works with other departments to develop new products to meet the evolving needs of existing and new customers. This requires researching competitors’ products, understanding what customers want and recommending ideal features and benefits for the products. It also includes designing product packaging that attracts customers.

2. Price. Marketing determines how much to charge for a product based on competitive products and customer’s demand. A chosen price ideally maximizes revenue while also leading to increased sales and market share.

3. Place. Marketing activity includes the product distribution. This requires understanding distribution costs and the competitive dynamics of the regional marketplaces.

4. Promotion. Marketing develops all company’s communication, such as advertising, direct marketing, public relations, web-sites and web-marketing. This includes developing marketing campaigns that stimulate customers’ interest. Mass media is best for reaching these customers and providing resources to help the company sales force effectively sell the product.

[1] Клеменцова Н.Н. Текст в организации процесса языкового обучения в техническом вузе//V Международный Балтийский морской форум. XV Международная научная конференция «Инновации в науке, образовании и предпринимательстве – 2017». Том 3. Тезисы докладов. 21-27 мая 2017. Калининград: Изд-во БГАРФ ФГБОУ ВО «КГТУ», 2017. – с. 22-24.