Marketing Glossary – HSC Business Studies

Marketing
Tasks aimed to connect the business with customers in order to sell a product
Role of marketing
Promoting the business’ goods or services to generate funds for the other business function in order to achieve goals
Production approach
Focus on developing a quality product and assuming consumers will buy it
Selling approach
Focus on the skill of selling the product
Marketing approach
Focusing on the customers’ needs and wants at every stage of the operations process
Intermediate markets
Market where products are sold to companies that then sell the products to other customers
Industrial markets
Markets in which products are sold to other businesses to be used to make other products
Resource markets
Markets in which the customers are in the primary sector of the economy
Consumer markets
Markets in which goods and services are sold to individuals
Mass markets
Market with a large amount of potential customers with varied characteristics
Niche markets
Market with a small amount of customers with a specific shared characteristic (demographic, phsycographic, geographic)
Customer choice
What drives customers to make purchasing decisions
Psychological factors
Personal factors: personalities and motivations of potential customers
Sociocultural factors
Cultural background and socioeconomic status of potential customers
Economic factors
Economic state and changes: interest rates and interest rates
Governmental factors
Laws and policies that impact on customer choices
Deceptive/misleading advertising
Advertising unfairly creating an inaccurate impression about some aspect of the product
Price descrimination
Same products sold for a different price in a different market
Implied conditions
Unwritten conditions that bind sellers of products
Warranties
Guarantees that a business makes about the product
Ethical issues
Moral dilemas in marketing
Fair competition
Legislation in place to try and ensure a good and fair level of competition
Sugging
Selling under the guise of (disguise of) research
Situational analysis
Step of the marketing plan that involves reviewing the position of the business or product
SWOT analysis
The strengths and weaknesses (internal), opportunities and threats (external) of a business
Product life cycle
The four stages (1. R&D, 2. growth, 3. maturity, 4. saturation/post-maturity) the product undertake from the time it enters the market until the time it ends
Market research
Collection and analysis of information about the factors that impact on the firm’s success
Primary research
Gathering new data first-hand for a specific study (eg. observations, surveys, experiment, interviews and focus groups)
Secondary research
Gather data that already exists (eg. statistics, journals, financial reports, competitor information, newspapers)
Marketing objectives
Goals for the marketing department that are aimed at achieving the business objectives
SMART marketing objectives
Specific, Measurable, Achievable, Realistic and Time-bound
Financial forecast
Estimation of the firm’s future financial situation, based on the information in the marketing plan
Monitoring and controlling
Measuring the business’ actual performance against its planned performance
Target market
Group of customers that the business intends to focus on marketing its products
Target market identifiers
Demographic, geographic and psychographic factors
Marketing strategies
Plans and goals that are going to help the business meet its marketing objectives
Marketing mix (4 Ps)
Price, product, promotion, place (distribution)
Implementation of a marketing plan
Putting marketing strategies into practice through the marketing mix
Market segmentation
Process of dividing the total markets into groups/segments
Product differentiation
Creating characteristics of a product/service that differentiates it from a competitor
Product positioning
Shaping the way that customers see the product and/or business compared to tis competitors
P1: Product
A substance that is manufactured for sale
Core product
Basic product that customers look to buy
Actual product
Core product and the additional physical aspects a customer pays for (eg. style)
Augmented product
Includes additional aspects beyond these physical factors that add value for customer (eg. warranty)
Branding
Giving a name/logo/”look” to the product that also represents the business
Packaging
The way in which a product is presented
P2: Price
The amount of money payed for a good/service
Pricing methods
Overall approaches to pricing products providing a basic framework that marketers can use
Cost-based pricing method
Cost of production + a mark up (percentage)
Competition-based pricing method
Based on competitors prices (higher, lower or equal to)
Market based pricing method
Based on the rate of supply and demand
Pricing strategies
The different pricing techniques that marketers can use to achieve business objectives
Skimming pricing strategy
Use of high price to directly maximise profit
Loss leaders pricing strategy
Selling goods below cost to attract customers (and hope that they will then buy full priced products)
Price point pricing strategy
Specific prices at which customers are more likely to buy a product (eg. $99.99 instead of $100.00)
Penetration pricing strategy
Price is placed below that of the competition to grow (penetrate into) the business’ market share
Relationship between price and quality
Higher prices generally equalling higher quality products
P3: Promotion
Communication from the business to potential customers
Advertising
Paid messages used to promote a product using media
Personal selling
Direct, two-way communication between the seller and potential buyer
Sales promotions
Short-term reduction on products (eg. discounts, cashback)
Publicity and public relations
Seek to create a positive image for the company and to increase exposure for the product without paying for advertisements
Opinion leaders
Early adopters of products convincing people to follow their advice
Word of mouth
The impact that influential individuals have over sales by affecting the perceptions of other potential customers about a product
P4:Place (Distribution)
How the products are transferred from the producer to the final customer
Distribution channels
The routes that producers can use to move products to the final customers
Direct distibution channels
The producer sells the products to the final customer without the use of intermediaries
Indirect distribution channels
The producer uses intermediaries to sell the product to the final customer (eg. mobile carriers)
Wholesalers
Businesses that buy large quantities of the product from the producer and then sell it on to retailers
Retailers
Businesses that buy the producer’s product and sell it to their final customer
Agents
Intermediaries that arrange transactions between the producer and the customer but do not sell the product themselves (eg. real estate agent)
Channel choice
How many locations will be used to sell a business’ goods (intensive, selective or exclusive)
Intensive channel choice
Producer seeks to have its goods sold in as many location as possible
Selective channel choice
Producer chooses to limit the number of locations in which its goods are sold
Exclusive channel choice
Producer chooses to have its products sold in only one location
Physical distribution issues
Choosing betweens modes of transport, warehousing (more or less) and amount of inventory
Transport physical distribution
Choosing between air and/or road or water and/or rail
Warehousing physical distribution
Choosing between more or less warehouses
Inventory physical distribution
How much stock to keep
The 3 additional Ps (for services and modern day marketing)
Physical evidence, people and processes
P5: Physical evidence
Giving potential customers exposure to the actual product so that they can judge the product and be persuaded to purchase
Physical aspects of services
Location, equipment, business cards, signs etc
P6: People
Selecting the right people for the job and instructing them properly
P7: Processes
Systems used for delivering a service
E-marketing
Internet marketing
Global marketing
Process of marketing a product that is sold all around the world
Global branding
Using the same brand and marketing strategies all around the world
Standardisation
The same marketing mix strategies being used in different markets
Customisation
Adapting the marketing mix strategies for different markets
Global pricing
Whether to use a uniform price across all countries or to customise pricing strategies per country
Competitive positioning
The business might need to change certain factors (product, price, promotional strategies and packaging) based on country to make sure that their product is competitive within that market