Year 10 Marketing Definitions

Marketing

The bringing together of buyers and sellers to exchange goods and services

Marketing plan

a document which outlines the goals, the intended marking mix and the target market for the business

Market research

Studying the buyers and or sellers of a good service to provide the firm with information to increase its profits

Primary research

The collection and collation of original data via direct contact with potential or existing customers

Secondary research

Information that has already been collected and is available for use by others

target market

The specific group of potential buyers that the firm aims to sell to

survey

A questionaire that gathers information about the target market

The marketing mix

The essential elements of a good marketing strategy. The combination of product, place, price and promotion

Product

The features of the good or service being sold

Promotion

Increasing the awareness of the product to potential customers to persuade them to buy

Place

The distribution channel which gets the product to the customer

Price

What a buyer must pay to purchase the good or service

Cost-plus pricing

Where the price is the cost of making the product plus a profit mark-up

Competitive pricing

Where the price is the same as, or just below, what competing firms are charging

Price skimming

Where the price is set high because it’s a new product so it has ‘novelty value’

Promotional pricing

Where the price is set very low for a short time only

psychological pricing

using numbers and decimals to make the customer believe the product is cheaper than it really is

dynamic pricing

Where businesses charge different prices for their products depending on which customers are buying them or when the products sell

Price competition

Where the firm lowers the price of its product to encourage customers to buy it

Examples of price competition

discount or sale, interest-free terms, buy one get one free, using loss leaders

Price war

When a group of competing firms all reduce their price to try and have the lowest price

Non-price competition

When a firm tries to increase sales by any method apart from reducing the selling price

Examples of non-price competition

Gift with the purchase, loyalty programmes, great service, location, branding, advertising, packaging, sponsorship

Loyalty programme

offering special deals for customers who continue to purchase from the firm or group of firms

service

Extra help from the firm provides to support customers using its good or services

location

The site of the business

branding

Where colours, images or a logo are used to present a business or its product.

advertising

Paying a 3rd party to communicate details of your product or business to potential customers. Any form of paid promotion

packaging

The container in which the good is sold; how it is presented

sponsorship

A way of advertising where a firm provides finance to an event. Paying to have the name or brand of your product associated with a particular sport or organisation.

What encourages people to buy products?

Brand, design quality, packaging and features

Penetration pricing 

Where the price is set well below competitors prices in order to enter a new market

Promotion

Increasing the awareness of the product to potential customers to persuade them to buy.

Uses of promotion

It informs customers about the product, where it is and what does. It persuades them to buy it

Aims of Promotion

Attention, interest, desire and action

service

all things a firm offers apart from the product

competitions

firms may offer a prize to increase sales where the entracnce of the competition is the purchasing of a product

loss leaders

pricing a produt below the cost of production to attract customers to spend more on other products