Business Management - Unit 4: Marketing

marketing

management process responsible for identifying, anticipating and satisfying customer requirements profitably

market

a place where buyers and sellers come together or interact or a location

the product life cycle

a model that is designated to help product managers make strategic decisions concerning a product’s marketing mix

research and development

first stage of the product life cycle. most products do not make it out of this stage due to the low impact that the product or service generated

introduction

second stage of the product life cycle. it’s when the product is finally launched into the market

growth

third stage of the product life cycle. the product is starting to generate revenue and sales are increasing. it’s establishing its position in the market

maturity

fourth stage of the product life cycle. the product is at it’s peak point regarding sales, market share and overall recognition

decline

final stage of the product life cycle. the product is becoming obsolete and sales are starting to decrease as well as market share

product orientation

the prioritization of research and development over market research, in order to innovate a product before analyzing the market

market orientation

the prioritization of a market research over the research and development of the product

consumer marketing

when a business is marketing to its consumers

business to business marketing

businesses that are engaged to market its product to other business

marketing mix of goods

the use of 4Ps: product, price, place, and promotion

marketing mix of services

the use of 7Ps: product, price, place, promotion, process, physical evidence, and people

market size

the total sales of all firms in a market

market growth

the % change in the total market size over a period of time

market share

the % of one’s firm’s share of the total market

market leader

a firm with the highest % of market share in a given market

mass marketing

when a business offers almost the same products to all consumers and promotes them in almost the same way

niche marketing

when a business targets a product to a particular segment or small part of a larger market

commercial marketing

determine consumers’ needs before implementing the strategies to market the product

social marketing

aimed at influencing a positive change in individuals for the society’s well-being

social media marketing

the use of networking and technologies to promote a product or service

marketing planning

the formulation of marketing objectives and appropriate marketing strategies to meet those objectives

marketing plan

a document that details all of a company’s marketing activities: objective, budget, segmentation, target market, market research, marketing strategies, and control tools.

segmentation

involves breaking consumers into groups that have similar characteristics and needs

target market

the specific market the business has chosen to promote its products or services to

market research

the gathering of information about consumers’ needs, tastes, habits, and preferences to aid marketing decisions

marketing strategies

long-term actions that aim to achieve the marketing objectives

marketing mix

key elements of a marketing strategy that ensure the successful marketing of a product

geographic segmentation

division of consumers according to their location

demographic segmentation

studies the structure of a population based on factors such as age, gender, religion, race, occupation, and educational levels

segmentation by social class

division of the population using the interlinked factors of occupation, income, and level of education

psychographic segmentation

divides the population according to lifestyle and personal interests

product positioning maps

visual representations of how the various competitors attempt to position their brands in the eyes of the consumer

unique selling point (USP)

a feature of a product that makes it stand out from its competition

consumer profile

the sets of characteristics that make up the identity of a specific type of customer according to its wants or/and needs

sales forecasting

tool used by businesses to predict what levels of sales they may expect in future years

time series data

statistics that are recorded over time. the independent variable is time, and the dependent is the product or service

trend

a pattern that is happening often over time. this occurs for different reasons like fashion, news, etc.

variations

difference between actual sales and trend values

cyclical variations

variations affected by the economic cycle of a country

random variations

variations that may occur at any time, and for a variety of reasons that can’t be predicted

moving averages

useful indicatior in sales forecasing to identify and emphasize the direction of a trend

time series analysis

quantitative sales forecasting method that predicts future sales levels from past sales data

extrapolation

extension of a trend line to predict future sales

primary market research

leads to the creation of new information

primary research methods

surveys, interviews, focus groups, observations

surveys

questionnaires sent out to a particular target audience to enable the researcher to gather useful information

interviews

guided conversation using designed questions to gain qualitative information for the market research

focus groups

an interview conducted with a group of individuals, usually with similar characteristics

observations

a fundamental and basic method of getting information by carefully watching and trying to understand certain things or people’s behavior

secondary research

known as desk research, uses information that’s already available

secondary research methods

market analysis, academic journals, government publications, media articles

market analysis

comissioning a market reserach agency to carry out a new study or they can purchase a market analysis report that has already been published.

academic journals

scholarly journals that contain the very latest research and academic theory which has been published by academics from the world’s leading universities

government publications

publications from the government that cover topics such as population statistics and economics forecasts

media articles

consists of the websites and apps of newspapers and new channels which are updated practically every minute

qualitative research

not measurable information, collections of opinions, beliefs, preferences, and perceptions of the consumer

quantitative research

focuses on collecting large amounts of data that is measurable, usually numbers and percentages

sample

sub-group within a population that can be used to conduct research on, rather than researching the entire population

types of sampling

convenience, random, cluster, snowballing, stratified, and quota

convenience sampling

easiest method of sampling where the researcher will obtain the people by those who are willing to participate

random sampling

each member of the sample has an equal chance of being selected to be part of the research

cluster sampling

sample is divided in geographical areas or regions, the researcher will go to each cluster and then use random sampling

snowballing sampling

chain-referral method of sampling, used when specific knowledge is needed, the interview will ask the interviewee to make a recommendation to continue the research

stratified sampling

the sample is divided in characteristics of the people into different groups (demographics), and then random sampling is applied to select members from each group

quota sampling

the sample is divided into characteristics of the people from different groups and then convenience sampling is applied to select members from each group

product

anything that can be exchanged and is able to satisfy customers’ needs

boston consulting group (BCG) matrix

a tool to help companies with multiple products decide their marketing strategies

divisions of the BCG matrix

cash cows, dogs, stars, and problem child

cash cows

high market share, low market growth products that are successful in mature markets. they enjoy high sales revenue from an established customer base

dogs

low market share, low market growth products which may be at the end of their life cycle or they are niche products competing in mature markets

stars

high market share, high market growth products that have a significant proportion of fast-growing markets. revenues should be equally as fast growing

problem child

low market share, high market growth products that have a small market share but operate in high growth markets. these products are most likely in their introduction stage in response to the rapidly growing revenues of competitors

brand

a name, symbol, or design that is used to identify a product or company

price

the amount of money expected, required, or given in payment for something

pricing

setting the right selling price for a product. if the price is too high, potential customers may be scared away. if the price is too low, profits will not be maximized

pricing methods

cost-plus, price leader, price folower, psychological, predatory, price discrimination, and loss leader

cost-plus pricing

calculating the total cost of a product and then adding a percentage for the profit margin

price leader pricing

premium pricing

adopting a price that is slightly above rivals to give an image of prestige

price follower pricing

setting a price that is similar to that or rivals

psychological pricing

setting a price in a way that seems attractive to consumers

predatory pricing

temporarily setting an extremely low price to undercut rivals, forcing them to leave the market. this type of pricing is often illegal.

price discrimination pricing

charging different groups of consumers different prices for the same good or service

loss leader pricing

significantly reducing the price of a single item to attract customers, expecting them to buy other products while shopping

branding

the process of creating an image or symbol that represents the company and is easily identifiable

brand awareness

the extent to which a brand is recognized and associated to a product by customers

brand loyalty

the tendency of customers to continue buying the same brand rather than the competitors

brand value

importance of the brand from the customer’s perspective

packaging

how the product is presented, its purpose is to protect the product and communicate information

above the line (ATL) promotion

the use of paid-for media such as TV, radio, and the internet to reach a large audience and promote a product or service

below the line (BTL) promotion

any promotion that is not carried out in the mass media

promotional mix

combination between both BTL and ATL promotion

viral marketing

when an advertising message is self-replicated like a virus

guerrilla marketing

shies away from paying for traditional, expensive mass-marketing media such as television and print

channel of distribution

the path a product takes when it travels from producer to the final consumer

extended marketing mix

tool to help managers develop a marketing strategy for services

place

consideration of where the product should be available and how it’ll be displayed

promotion

the process of communicating to consumers about the product, that they need it and that it is appropriately priced. heavily relies on advertising, public relations, and the overall media strategy for introducing a product