IB Business Management HL Unit 4 - Marketing

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64 Terms

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Marketing

The management process responsible for identifying, anticipating and satisfying consumers' requirements profitability.

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Marketing of Goods (marketing mix 4 P's)

the use of the 4 Ps - product, price, place, and promotion in the marketing mix

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Marketing Services

The use of the 7Ps - product, price, place, promotion, process, people, and physical evidence in the marketing mix

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Market Led Production

The business identifies/predicts the needs of the market, then develops and markets a product to meet that need

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Product Led Production

The business develops a product that fits their objectives then markets the product to try and attract/reach customers.

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Commercial Marketing

Marketing activities that determine consumer needs and wants before using appropriate strategies to market the product

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Social Marketing

A marketing approach aimed at influencing a positive change in individual behaviour and improvements in societal well-being

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Social Media Marketing

A marketing approach adopted by businesses that uses social networking websites from the Internet to market its products.

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Market Growth

Tthe percentage change in the market size over a given period of time, usually a year. This can be based on the market value or volume.

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Market Share

The percentage of one firm's share of the total sales in the market

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Market Leader

The firm with the highest market share in a given market

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Main Marketing Objective for For-Profit Organizations

To identify, design and develop marketing strategies that are profitable to the business.

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Product

The good or service that is offered in the market. A television is a tangible product, a service such as health insurance is an intangible product. Products should aim to satisfy the needs and wants of consumers.

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Price

The amount consumers are charged for a product. It indicates the value consumers perceive the product to have.

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Promotion

The various ways in which consumers are informed about and persuaded to purchase a product.

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Place

A product's location or channels of distribution used to get the product to the consumer. Products can be purchased in shops or over the Internet.

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Marget Segmentation

The process of dividing the market into smaller or distinct groups of consumers in an effort spefically to meet their desired needs and wants.

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Demographic Segmentation

this considers the varying characteristics og the human population in a market, such as age, gender, religion, family characteristics and ethnic grouping.

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Geographic Segmentation

where the market is divided into different geographical sectors and may consider factors including country and climactic regions

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Psychologic Segmentation

this divides the market based on people's lifestyle choices or personality characteristics, such as social and economic status and values.

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Target Market

a group of consumers with common needs or wants that a business decides to serve or sell to

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Niche Market

A narrow, smaller or more specifc market segment

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Mass Market

A large or broad market that ignores specific market segments

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Consumer Profile

The characteristics of consumers of a particular product in different markets based on their gender, age, and income levels, etc.

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Positioning

Involves analyzing how consumers define or perceive a product compared to other products in the market.

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Perception Map

a visual representation of how consumers perceive a product in relation to other competing products

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Unique Selling Point

A product's feature that differentiates it from other competing products in the market

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SMART Targets

Specific

Measurable

Achievable

Relevant

Time Bound

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Sales Forecasting

The process of predicting the future sales of a firm

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Market Research

The process of collecting, analyzing, and reporting data related to a particular market, including data on consumption of goods and services and on competitors behavior.

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Primary Market Research

First-hand information from the market. Most organizations will conduct this research to find out specific buying patterns of consumers and attempt to anticipate any changes in their spending behavior over a given period of time.

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Secondary Market Research

Second-hand information from the market - also known as desk research.

Involves analyzing data that already exists in some form.

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The Product Life Cycle

Stage 1: Development

Stage 2: Introduction

Stage 3: Growth

Stage 4: Maturity

Stage 5: Saturation

Stage 6: Decline

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Price Skimming

Setting a high price when introducing a new product to the market

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Penetration Pricing

Setting a low initial price for a product with the aim of attracting a large number of customers quickly and gaining a high market share

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Extension Strategies

An attempt by firms to stop sales from falling by lengthening or extending the product's life cycle.

For example:

sell existing products into new markets

find new uses for the product

change packaging

target different market segments

develop new promotional strategies

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Branding

The process of distinguishing one business's product from another and can add great value to a product.

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Brand Awareness

The ability of consumers to recognize the existence and availability of a firm's good or service

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Brand Loyalty

When consumers become committed to a firm's brand and are willing to make repeat purchases over time

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Brand Value

How much a brand is worth in terms of its reputation, potential income, and market value. - the extra money a business can make from its products because of its brand name.

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Packaging

The design and production of the physical container or wrapper of a product. Packaging plays a significant role in marketing and can help in distinguishing one product from another.

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Cost-Plus Pricing (mark-up pricing)

Adding a mark-up to the average cost of producing a product.

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Above the Line Promotion

Advertisements paid for by a business to communicate with consumers, e.g. Television, internet, etc.

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Below the Line Promotion

Promotion activities including sales promotions, e.g. sponsorship, coupons, customer loyalty schemes, etc. (the business has direct control over its promotional activities.)

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Informative Adverts

Designed to communicate information about the product, such as cost, technical specifications, etc. to consumers

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Persuasive Adverts

Designed to develop the identity of a product and/or brand

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Viral Marketing

a form of peer-to-peer communication where individuals are encouraged to pass on promotional messages within their social networks

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Guerilla Marketing

Marketing and promotional activities in places you dont expect to see them. For ex. subliminal messaging, comments, pop-ups

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Distribution Channels

A distribution channel or channel of distribution is the path taken by a product from the producer to the consumer.

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Distribution Channels - Direct Selling

Manufacturer/Service Provider —> Customer

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Distribution Channels - One Intermediary Channel

Manufacturer/Service Provider —> Retailer Agent —> Consumer

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Distribution Channels - Two Intermediary Channel

Manufacturer —> Warehouse —> Retailer—> Customer

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The 7 P's

Product

People

Physical Evidence

Processes

Promotion

Place

Price

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People

An essential element of any service business so businesses should ensure that their employees have the right attitude, skills and appearance at all times as they are the face of the organization.

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Processes

The procedures and policies pertaining to how an organization's product is provided and delivered to the consumer.

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Physical Evidence

The visible touch points that are observable to customers in a business and is an important differentiator in service marketing.

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International Marketing

The marketing of goods and services across national boundaries

Methods:

Direct Exporting

Joint Ventures with Local Organizations

Licensing Agreements

Franchising

Foreign Subsidiaries

Online Marketing

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Globalization

The increasing worldwide competition leading to a rise in international marketing

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Piggybacking

The use of the existing distribution channels of one domestic business by another home country business trying to sell a new product overseas

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Seasonal Trends

Regular increases/decreases in sales occurring at regular, predictable, interval. These are often connected to the type of product. e.g. spices will increase in sales every Q4

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E-Commerce

The buying and selling of goods and services through electronic networks, commonly via the Internet.

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E-Commerce - Business to Business

Where a business trades with another business.

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E-Commerce - Business to Customer

Carried out from a business to a particular end user who is usually the customer or consumer.

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E-Commerce - Consumer to Consumer

Allows for transactions from one customer or consumer to another.