Unit 4 Marketing

Market Growth

Refers to an increase in the size of a market, usually measured by the rise in total sales revenue of the market or industry.

Market Leader

Refers to the business with the largest market share in a given industry

Market orientation

This is an approach to marketing that focuses on meeting the specific demands (desires and needs) of customers and potential customers

Market share

Refers to the sales revenue that an organization accounts for within a given market or industry. It is measured by expressing the firm’s sales revenue as a percentage of the whole industry’s sales revenue

Market size

The total number of individual customers or the total value of sales revenue in a certain market

Marketing

The management process of identifying, anticipating, and satisfying customer requirements in a profitable way. It is the art of determining the goods and services required to meet the needs and wants of customers in a sustainable way

Needs

These are the things people need in order to survive, e.g., food, water, and shelter

Product orientation

This is an approach to marketing that focuses on making products a business knows how to make well, rather than primarily concentrating on the needs and desires of potential customers

Sales revenue

Refers to a firm's income from selling its goods and/or services, i.e., the value of its sales

Sales volume

Refers to the volume (quantity) of sales of a particular business

Wants

These are human desires, i.e., things that people would like to have, or have more of.

Demographic segmentation

The process of splitting consumers according to statistical characteristics of the population, such as age, gender, family size, religion, and ethnicity

Differentiation

The process of distinguishing an organization’s products from those of other firms in the same industry

Geographic segmentation

The marketing process that involves characterising consumers according to their different geographical locations

Market

A market is the collective term for the buyers and sellers of a particular good or service

Market segment

A distinct group of customers with similar characteristics, tastes, and preferences

Market segmentation

The process of dividing a market for a product into smaller or distinct groups of customers in an effort to meet their specific desired needs and wants

Marketing mix

The key elements of a marketing strategy to ensure its success in meeting the needs and wants of the organization’s customers and the firm’s marketing objectives

Marketing objectives

These are the goals or targets that help to give marketing teams (or marketing departments) a sense of purpose and direction

Marketing plan

A document that shows the marketing objectives and marketing strategy of a particular business

Marketing planning

The structured process of formulating marketing objectives and appropriate marketing strategies to achieve these goals

Marketing strategies

The different long-term actions used by an organization to achieve its marketing goals

Mass markets

A marketing approach that focuses on supplying to wide-ranging groups of customers in a market, without having split them into separate market segments, such as the markets for bottled water or breakfast cereal

Niche markets

Marketing approach that focuses on supplying highly specialised products to cater for a small and select target market

Objective

An objective is a target or goal a business organization strives to achieve

Premium products

Goods or services that are perceived by customers to be of high quality and high price

Product differentiation

Refers to the process by which firms attempt to make their goods and services different from those provided by other firms in the market in order to increase their own sales revenue

Product position map

Also known as a perception map, this is a graphical illustration of customer perceptions of a business, its products, and/or brands in comparison to other firms in the industry

Psychographic segmentation

Segmentation that involves characterising consumers according to people’s lifestyle choices and personal values

Socio-economic segmentation

The process of splitting the market according to consumer or household income levels. This is often linked to their type of profession and/or their level of educational attainment

Target market

The group of customers that an organization focuses on selling its products to

Targeting

Targeting is the marketing practice of creating and using an appropriate marketing mix and marketing strategies to cater for different market segments

Above the line promotion

Form of promotion that refers to any form of paid-for promotional technique through independent consumer media

Advertising

A form of visual and/or audio marketing communication used to inform and persuade people to buy a certain good or service

Agents

Also known as brokers, these independent intermediaries help to sell a vendor’s products in return for commission, e.g., real estate agents

Below the line promotion

Form of promotion that refers to all forms of advertising or promotion that do not use external media agents

Brand

A brand is the registered name used to identify a product of a particular business organization

Brand awareness

The degree of customer knowledge and recognition of a particular brand in order to gain more customers

Brand development

Part of a firm’s marketing strategy in communicating the value of a brand and what the brand stands for

Brand loyalty

The degree of customer devotion to a particular brand

Brand switching

This is the opposite of brand loyalty and occurs when consumers turn to alternative brands, mainly because the original brand has lost some of its former appeal

Brand value

The expected earning potential of a brand, i.e., the likely future earning potential (value) of a particular brand

Branding

This is the practice of using an exclusive name (brand), symbol, or design which identifies a specific product or business

Competitive pricing

This pricing method involves a business setting the price of its products at the same or similar level charged by competitors in the market

Consumer goods

These are products bought for personal consumption, rather than for business use, e.g., home appliances, furniture, food and drink, and house plants

Distribution (place)

The marketing process of getting the right products to the right customers in the right place and at the right time

Distribution channel

Also known as a channel of distribution, this refers to the path taken for a product to get from the producer to the consumer

Extension strategies

Marketing approaches used to prolong or lengthen a product’s life cycle, e.g., price reductions or new promotional strategies

Intermediary

A third-party person or business that offers distribution services as part of a channel of distribution, such as agents, wholesalers, and retailers

Intermediation

The marketing process of using a middle person or distributor as channels of distribution between the producer and consumers

Loss leader pricing

Pricing a product below its cost of production so as to attract customers to also buy other items (with a higher profit margin)

Multi-channel distribution strategy

This refers to a firm’s use of a different distribution channels to get its products to customers

One-channel distribution network

This method of distribution involves the use of a single intermediary, such as an agent or retailers

Penetration pricing

A pricing method that involves a firm setting low prices so as to gain entry in a new market. The firm will then raise the price once the product or brand has established itself in the industry

Predatory pricing

A strategy that involves charging a low price, sometimes even below the cost, so as to damage the sales of rivals

Premium pricing

A pricing method that involves a firm charging significantly higher prices than similar or competing products in the market. This is usually due to the prestige or quality associated with the product or brand

Price

The value of a good or service that is paid by the customer

Price leadership

A strategy of following the price set by the dominant firm in the industry (the firm with the largest market share)

Price war

The process of rival businesses competing by continually reducing prices so as to threaten the competitiveness of rivals in the market

Process

This refers to the ways in which a service is provided or delivered, such as various payment systems, queuing systems, after-sales care, and delivery service options

Product

This refers to both physical (goods) and non-physical (services) items sold by a business or purchased by a customer

Product differentiation

This refers to marketing strategies used to make a product distinct from its rivals, e.g., branding, product features, and packaging

Product life cycle (PLC)

Marketing theory showing the different stages that most products go through from their research and development (R&D) stage to their final removal from the market

Promotion

The various marketing processes used to inform customers about a product and persuading them to purchase the product

Promotional mix

The range of above and below the line methods used to promote a product as part of a larger marketing mix

Three-channel distribution network

This type of distribution channel uses three intermediaries. It often involves an agent who sells the goods to wholesalers on behalf of the producer. In turn, wholesalers sell to retailers

Through the line (TTL) promotion

TTL refers to the promotional strategies that involve both above the line (ATL) and below the line (BTL) promotional methods. It enables customers to engage with the product and/or brand in different ways

Two-channel distribution network

This method of distribution involves the use of two intermediaries, usually wholesalers and retailers

Wholesalers

These are intermediaries that buy products from a manufacturer and sell these in smaller quantities to retailers

Zero-channel distribution network

Also known as direct distribution, this method does not use any intermediaries