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Marketing (Subject) / Definitions (Lesson)

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• Diffusion The process by which the adoption of an innovation spreads
• Product Life Cycle (PLC): A biological metaphor that traces the stages of a product’s acceptance, from its introduction (birth) to its decline (death).
• Product Category: All brands that satisfy a particular type of need.
• Introductory Stage : The first stage of the product life cycle in which the full-scale launch of a new product into the marketplace occurs.
• Growth Stage The second stage of the product life cycle when sales typically grow at an increasing rate, many competitors enter the market, large companies start acquiring small pioneering firms, and profits are healthy.
• Maturity Stage The third stage of the product life cycle during which sales increase at a decreasing rate.
• Decline Stage The fourth stage of the product life cycle, characterized by a long-run drop in sales.
• Marketing Channel/ Channel of Distribution : A set of interdependent organisations that ease the transfer of ownership as products move from producer to business user or consumer.
• Channel Members All parties in the marketing channel that negotiate with one another, buy and sell products, and facilitate the change of ownership between buyer and seller in the course of moving the product from the manufacturer into the hands of the final consumer.
• Discrepancy of Quantity The difference between the amount of product produced and the amount an end user wants to buy.
• Advertisement
• Temporal Discrepancy A situation that occurs when a product is produced but a customer is not ready to buy it.
• Spatial Discrepancy The difference between the location of a producer and the location of widely scattered markets.
• Logistics The efficient and cost-effective forward and reverse flow as well as storage of goods, services, and related information into, through, and out of channel member companies. Logistics functions typically include transportation and storage of assets, as well as their sorting, accumulation, consolidation and /or allocation for the purpose of meeting customer requirements.
• Price That which is given up in an exchange to acquire a good or service.
• Supply Chain The connected chain of all of the business entities, both internal and external to the company, that perform or support the logistics function.
• Supply Chain Management A management system that coordinates and integrates all of the activities performed by supply chain members into a seamless process, from the source to the point of consumption, resulting in enhanced customer and economic value
• Intensive Distribution A form of distribution aimed at having a product available in every outlet where target customers might want to buy it.
• Selective Distribution : A form of distribution achieved by screening dealers to eliminate all but a few in any single area.
• Exclusive Distribution A form of distribution that establishes one or a few dealers within a given area.
• Just-in-Time Manufacturing : A process that redefines and simplifies manufacturing by reducing inventory levels and delivering raw materials just when they are needed on the production line.
• Revenue: The price charged to customers multiplied by the number of units sold.
• Profit: Revenue minus expenses.
• Profit Maximization Setting prices so that total revenue is as large as possible relative to total costs. A method of setting prices that occurs when marginal revenue equals marginal cost.
• Market Share : A company’s product sales as a percentage of total sales for that industry.
• Status Quo Pricing A pricing objective that maintains existing prices or meets the competition’s prices.
• Markup Pricing: The cost of buying the product from the producer plus amounts for profit and for expenses not otherwise accounted for.
• Keystoning The practice of marking up prices by 100%, or doubling the cost.
• Marginal Revenue : The extra revenue associated with selling an extra unit of output, or the change in total revenue with a one-unit change in output.
• Selling Against the Brand Stocking well-known branded items at high prices in order to sell store brands at discounted prices.
• Prestige Pricing Charging a high price to help promote a high-quality image.
• Advertisement
• Relationship Marketing A strategy that focuses on keeping and improving relationships with current customers.
• Marketing Planning Designing activities relating to marketing objectives and the changing marketing environment.
• Planning: The process of anticipating future events and determining strategies to achieve organizational objectives in the future.
• Environmental Scanning Collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization or the implementation of the marketing plan.
• Price Strategy A basic, long-term pricing framework, which establishes the initial price for a product and the intended direction for price movements over the product life cycle.
• Price Skimming A pricing policy whereby a firm charges a high introductory price, often coupled with heavy promotion.
• Penetration Pricing A pricing policy whereby a firm charges a relatively low price for a product initially as a way to reach the mass market
• Promotion Communication by marketers that informs, persuades, and reminds potential buyers of a product in order to influence an opinion or elicit a response.
• Promotional Strategy A plan for the optimal use of the elements of promotion: Advertising, Public Relations, Personal Selling, and Sales Promotion
• Promotional Mix The combination of promotional tools – including advertising, public relations, personal selling, and sales promotion – used to reach the target market and fulfil the organisation’s overall goals.
• Advertising : Impersonal, one-way mass communication about a product or organisation that is paid for by a marketer
• AIDA Concept A model that outlines the process for achieving promotional goals in terms of stages of consumer involvement with the message; the acronym stands for attention, interest, desire, and action.
• Institutional Advertising A form of advertising designed to enhance a company’s image rather than promote a particular product
• Product Advertising A form of advertising that touts the benefits of a specific good or service.
• Advocacy Advertising A form of advertising in which an organisation expresses its views on controversial issues or responds to media attacks
• Pioneering Advertising A form of advertising designed to stimulate primary demand for a new product or product category.
• Competitive Advertising A form of advertising designed to influence demand for a specific brand.
• Comparative Advertising A form of advertising that compares two or more specifically named or shown competing brands on one or more specific attributes.
• Advertising Appeal A reason for a person to buy a product
• Medium The channel used to convey a message to a target market

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