marketing exam 3

What is pricing?

The amount being charged or exchanged for a product or service.

What is value?

What a product or service is worth to a consumer, or the maximum amount they would be willing to pay.

What is value-based pricing?

A pricing strategy that sets prices based on the perceived value a consumer receives from a product or service.

What is price elasticity?

The change in demand in response to a change in a product's price.

What is price elasticity of demand?

A measure of how sensitive consumers are to changes in price.

What is an elastic product?

A product whose demand changes significantly when its price changes.

What is an inelastic product?

A product whose demand changes very little when its price changes.

What are fixed costs?

Costs associated with the operating and marketing expenses of a company that do not change with the quantity produced.

What are variable costs?

Costs that change depending on the quantity of products produced or sold.

What is direct cost pricing?

A pricing strategy that calculates variable costs only.

What is full cost pricing?

A pricing strategy that takes into account both variable costs and fixed costs.

What is breakeven price?

The price a marketer needs to charge to cover expenses at a certain quantity sold.

What is breakeven quantity?

The quantity a company needs to sell at a certain price to cover its costs.

What is a price floor?

The absolute minimum a company can sell a product for and still break even.

What is markup?

An added percentage or dollar amount added to the cost of a product to determine its selling price.

What is profit margin?

The difference between the final selling price and product cost, expressed as a percentage or ratio of the selling price.

What is a la carte pricing?

A strategy in which product features can be added and purchased individually, allowing consumers to choose the final price.

What is bundle pricing?

Packaging two or more goods or services together and selling them for one combined price.

What is flat rate pricing?

A strategy in which a company charges one rate for unlimited use of a service during a specified timeframe.

What is multiple unit pricing?

A pricing strategy in which a marketer offers a price break for purchasing multiple units of a product.

What is dynamic pricing?

A pricing strategy in which prices vary depending on factors such as customer demand, timing, or market conditions.

What is market penetration pricing?

Introducing a product at a low price to attract customers and gain market share.

What is price skimming?

Introducing a product at a high initial price and gradually lowering the price over time.

What is a loss leader?

A pricing strategy in which a company sells a popular item at an artificially low price, sometimes below cost, to attract customers into the store.

What is prestige pricing?

Setting a high price so a product is viewed as elite or high-quality and attracts status-seeking customers.

What is odd-even pricing?

Setting a price slightly below an even number, such as $9.99 instead of $10.

What is reference pricing?

Using another price as a reference point to make a product's price seem more appealing; also called anchor pricing.

What is an external reference point?

A price supplied by a marketer to give consumers an idea of what a product is worth.

What is an internal reference point?

A price or price range that a customer believes is fair or standard based on their knowledge or experience.

What is extremity aversion theory?

The theory that people tend to avoid extreme options and often choose a middle-priced option.

What is a smart industry?

An industry in which companies use more complex pricing structures and offer multiple pricing options.

What is a dumb industry?

An industry in which companies primarily compete on price, with the lowest price being their main differentiator.

What is psychological pricing?

A pricing strategy that uses consumer psychology to make prices appear more attractive or appealing.

What is price anchoring?

Using an initial price as a reference point that influences how consumers perceive subsequent prices.

What is the decoy effect?

Introducing a third option that makes one of the other options seem more attractive.

What is price-quality inference?

The tendency for consumers to assume that a higher-priced product is better quality than a lower-priced product.

What is partitioned pricing?

Breaking a product's total price into separate components, such as the product price and shipping fee.

What is the promotional mix?

The combination of tools marketers use when creating or refining promotions.

What is integrated marketing communications (IMC)?

A coordinated combination of marketing communication activities, techniques, and media designed to deliver a consistent message to a target market and achieve common objectives.

What is external communication?

When a marketer sends a message to people outside the company rather than to company employees.

What is persuasive communication?

Communication intended to influence a customer to make a purchase decision.

What are the five main elements of the promotional mix?

Advertising, sales promotion, public relations, personal selling, and direct marketing.

What is advertising?

Paid external communication by a seller that promotes a product or service to potential customers.

What is sales promotion?

A short-term external promotion designed to influence immediate purchases.

What is public relations (PR)?

The practice of managing the spread of information between an individual or organization and the public.

What is personal selling?

Direct interaction between a company representative and a potential buyer designed to influence a purchase decision.

What is direct marketing?

A promotional effort in which a seller communicates directly with potential customers through methods such as direct mail or telemarketing to encourage a direct response.

What is advertising media?

The various methods used to communicate promotional messages, including billboards, magazines, newspapers, radio, television, and the internet.

What is reach?

The number of different people exposed to an advertisement.

What is an impression?

One exposure of a person to an advertisement.

What is frequency?

The average number of times members of a defined market see or hear an advertisement.

What is effective frequency?

The minimum number of times a person needs to see or hear an advertisement for it to make a difference or encourage action.

What is cost per thousand impressions (CPM)?

An industry-standard measurement used to compare the cost of different advertising options per 1,000 impressions.

What is waste coverage?

Advertising that reaches people outside the target market who are not potential customers.

What is the SUCCESs model?

A model designed to help ideas and messages stand out and stick in people's minds.

What does SUCCESs stand for?

Simple, Unexpected, Concrete, Credible, Emotional, and Stories.

What is an advertising campaign?

A series of advertisement messages that share a common idea and theme and run for a limited period of time.

What is the AIDA model?

A theory explaining how consumers make purchase decisions through four stages: Attention, Interest, Desire, and Action.

What does Attention mean in the AIDA model?

The first stage, where a marketer captures the consumer's attention.

What does Interest mean in the AIDA model?

The stage where a marketer creates interest in the product or service.

What does Desire mean in the AIDA model?

The stage where a marketer creates a want or desire for the product.

What does Action mean in the AIDA model?

The final stage, where the consumer takes action, such as making a purchase.

What is digital marketing?

Using digital channels and technologies, such as websites, search engines, email, and social media, to market products and services.

What is search engine optimization (SEO)?

The process of improving a website so it appears higher in organic search engine results.

What is a search engine results page (SERP)?

The page displayed after a user enters a search query into a search engine like Google.

What is crawling?

The process of search engines using automated programs called crawlers to visit webpages and discover their content.

What is indexing?

The process of search engines organizing and storing information about webpages so they can appear in search results.

What is generative engine optimization (GEO)?

The practice of creating and structuring content so it can be understood, cited, and featured in AI-powered search results.

What is a natural backlink?

A link from an external website that occurs because someone found the linked content useful.

What is a manufactured backlink?

A backlink obtained through intentional link-building activities.

What is a self-created backlink?

A link a marketer creates and places in locations such as forum posts, blog comments, online directories, or press releases.

What is a zero-click search?

When a user finds the answer to a search query directly on the search results page without clicking another website.

What is a landing page?

The webpage visitors are directed to after clicking on an advertisement.

What is a call to action (CTA)?

A button or message that clearly tells a website visitor what action they should take.

What is a conversion?

When a website visitor completes a desired action, such as making a purchase, subscribing, or registering for an event.

What is a bounce?

When someone visits one webpage and exits without visiting another page on the website.

What is bounce rate?

The percentage or rate of website visits in which someone views only one page before leaving.

What is dwell time?

The amount of time a visitor spends on a website or webpage.

What is a cookie?

Tracking data stored on an individual's computer or browser when they visit certain websites.

What is pay-per-click (PPC) advertising?

An advertising model in which advertisers pay when someone clicks on their advertisement.

What is a click?

An instance when someone clicks on a pay-per-click advertisement.

What is cost per click (CPC)?

The amount of money an advertiser pays each time someone clicks on their advertisement.

What is click-through rate (CTR)?

The percentage of impressions that result in clicks.

What is the formula for click-through rate (CTR)?

CTR = (Number of clicks / Number of impressions) x 100.

What is quality score?

A Google metric that evaluates factors such as keyword quality, ad relevance, and landing page experience.

What is social media?

Websites and applications that allow users to share content, information, and interact with each other.

What is social media marketing?

Using social media platforms strategically to market a person, product, company, organization, or idea.

What is a feed?

The area where posts from people a user follows or connects with appear; also called a timeline.

What are friends on social media?

People users connect with on social platforms, sometimes called connections.

What are followers?

People who connect with a person or company and view their content.

What are posts?

Content created and shared by users on social media platforms, including text, images, and videos.

What is post lifespan?

The amount of time a social media post continues to receive views before it essentially stops being viewed.

What is a profile?

A user's homepage on a social media platform that contains information about them and their content.

What is social media monitoring?

The process of listening to social media conversations relevant to a brand; also called social listening.

Who are users on social media?

All of the people who use a social media platform.

What is engagement on social media?

Interactions with content, such as likes, comments, shares, and saves.

What is engagement rate?

A measurement of how much an audience interacts with a social media account's content relative to its followers or reach.

What is organic social media marketing?

Reaching an audience through unpaid social media content.

What is paid social media marketing?

Paying social media platforms to promote content or advertisements to a targeted audience.

What is influencer marketing?

A marketing strategy in which companies partner with individuals who have an audience and influence on social media to promote products or services.