BUSI 406- Marketing Key Terms (Midterm 1)

BUSI 406 Marketing Key Terms for Midterm 1- Spring Semester 2025

Marketing

An organizational function and a set of processes for creating, communicating, and delivering value to customers and managing customer relationships.

4 P's

Place, Product, Price, Promotion - variables that meet consumer needs.

Customer Satisfaction

The result of providing goods and services that exceed customer expectations.

Innovation

The process of creating new or improved products to meet customer needs.

Pure Subsistence Economy

An economy where each family produces everything it consumes.

Macro-Marketing

A social process that directs an economy’s flow of goods and services from producers to consumers.

Universal Functions of Marketing

Buying, selling, transporting, storing, standardization and grading, financing, risk-taking, and market information.

Buying Function

The process of acquiring goods or services to meet customer needs.

Selling Function

The process of persuading customers to purchase goods or services.

Transporting Function

The movement of goods from producers to consumers.

Storing Function

Holding goods until they are needed by customers.

Standardization and Grading

Sorting products by quality and size to ensure consistency.

Financing

Providing the funds necessary to carry out marketing activities.

Risk-Taking

Accepting the possibility of loss in marketing activities.

Market Information Function

Gathering and analyzing data to make informed marketing decisions.

Intermediary

Someone who specializes in trade rather than production.

Collaborators

Firms facilitating marketing functions other than buying.

Economic System

The structure through which a society produces and distributes goods and services.

Command Economy

An economy where government officials decide production, distribution, and consumption.

Market-Directed Economy

An economy where individual producer and consumer decisions direct macro-level outcomes.

Simple-Trade Era

When families traded or sold their surplus output to local distributors.

Production Era

When a company focuses on the production of a few specific products.

Sales Era

When companies emphasize selling due to increased competition.

Marketing Department Era

When all marketing activities are controlled by one department.

Marketing Company Era

When marketing teams develop long-range plans guided by the marketing concept.

Marketing Concept

An organization aims all efforts at satisfying its customers at a profit.

Production Orientation

A focus on the product first, rather than the consumer.

Marketing Orientation

A focus on the consumer first, meeting their needs and wants.

Marketing Metrics

Measures used to evaluate the performance of marketing activities.

Triple Bottom Line (TBL)

A measure of long-term success focusing on economic, social, and environmental outcomes.

Purpose Orientation

An organization’s reason for being that extends beyond profit.

Customer Value

The difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits.

Micro-Macro Dilemma

What is good for some firms and consumers may not be good for society as a whole.

Social Responsibility

The obligation of businesses to act in ways that benefit society.

Marketing Ethics

The moral principles and standards that guide marketing practices.

Marketing Management Process

The process of planning marketing activities, directing implementation, and controlling plans.

Strategic (Management) Planning

The process of developing a match between an organization’s resources and its market opportunities.

Marketing Strategy

Specifies a target market and a related marketing mix.

Target Market

A group of customers to whom a company wishes to appeal.

Marketing Mix

The controllable variables (4 P’s) a company puts together to satisfy the target group.

Target Marketing

Tailoring a marketing mix to fit the specific needs of a target customer group.

Mass Marketing

Aiming at everyone with the same marketing mix.

Channel of Distribution

Firms that help the flow of products from producer to user.

Personal Selling

Direct communication with potential customers to persuade them.

Customer Service

Activities that support customers before, during, and after a purchase.

Mass Selling

Advertising aimed at a large audience.

Advertising

Paid, non-personal communication through mass media to promote products.

Publicity

Unpaid advertising often through media coverage.

Sales Promotion

Activities that stimulate interest to promote products.

Marketing Plan

A written statement of a marketing strategy and implementation details.

Implementation

Putting marketing plans into operation.

Operational Decisions

Short-run decisions to help implement marketing strategies.

Marketing Analytics

The practice of measuring and analyzing marketing performance.

Marketing Program

A blend of all of a firm’s marketing plans.

Customer Lifetime Value (CLV)

The total profits a single customer contributes to the firm over their relationship.

Retention Rate

The percentage of customers retained compared to the total number of customers.

Acquisition Cost

The expense required to acquire each new customer.

Customer Equity

Expected earnings stream of a firm’s customers over time.

Breakthrough Opportunities

Opportunities that deliver hard-to-copy marketing strategies.

Competitive Advantage

A marketing mix viewed as better than a competitor’s by the target market.

S.W.O.T. Analysis

Identifies a firm’s strengths, weaknesses, opportunities, and threats.

Differentiation

The marketing mix that is distinct from what a competitor offers.

Market Penetration

Trying to increase sales of present products in current markets.

Market Development

Trying to sell present products in new markets.

Product Development

Offering new or improved products for present markets.

Diversification

Moving into totally different lines of business.

Mission Statement

Sets out the organization’s basic purpose and objectives.

Purpose Statement

An aspirational statement that benefits a range of stakeholders.

Economies of Scale

As production increases, the cost per unit decreases.

Competitive Environment

Affects the number and types of competitors a marketing manager faces.

Sustainable Competitive Advantage

A marketing mix that cannot be easily copied by competitors.

Competitor Analysis

Evaluating strengths and weaknesses of current or potential competitors.

Competitive Rivals

A firm’s closest competitors.

Market Share

The portion of total sales in a product category accounted for by a brand.

Economic Environment

Macroeconomic factors affecting consumer and business spending.

Technology

The application of science to produce output.

Artificial Intelligence (AI)

Machines programmed to simulate human intelligence.

Intelligent Agent

A device that observes an environment to achieve a goal.

Machine Learning

Algorithms that improve in accuracy over time without explicit programming.

Metaverse

A virtual reality space for user interaction and environment engagement.

Nationalism

A political ideology emphasizing national interests, affecting trade.

Free Trade

Agreements between countries to allow unrestricted imports and exports.

Cultural and Social Environment

Influences on people's behaviors and buying habits.

Sustainability

Focusing on environmental and social responsibility in marketing.

Gross Domestic Product (GDP)

The total market value of all goods and services in a nation's economy.

Gross National Income (GNI)

Similar to GDP but excludes foreign earnings within the nation.

Senior Citizens

Older adults, typically over the age of 65, significant in marketing demographics.

Baby Boomers

The generation born between 1946 and 1964, significant for their economic impact.

Generation X (Gen X)

The generation born between 1965 and 1980, known for independence.

Generation Y (Gen Y)

Millennials born between 1981 and 1996, known for tech-savviness.

Generation Z (Gen Z)

The generation born between 1997 and 2012, driving purpose orientation.

Generation Alpha

The generation born after 2012, fully born in the 21st century.

Black Swan Event

An unpredictable event with severe market disruptions.

Market

A group of potential customers with similar needs.

Generic Market

A market with broadly similar needs and diverse seller solutions. (Doesn’t include product)

Product-Market

A market with very similar needs and close substitutes.

Market Segmentation

A process of naming broad markets and segmenting them for target marketing.

Segmenting

Clustering people with similar needs into a market segment.

Market Segment

A homogeneous group of customers responding similarly to marketing efforts.

Single Target Market Approach

Choosing one homogeneous group as the firm’s target market.