You are on page 1of 29

Glossary

(Words which are set in italics have their own entries in the glossary, where
they are further defined.)

A|B|C|D|E|F|G|H|I|J|K|L|M|N|O|P|Q|R|S|T|U|V
|W|X|Y|Z

4Ps: otherwise known as the marketing mix, these are the basic tools of
marketing: product, place, price and promotion.

7Ps: an extended marketing mix that takes account of the particular


characteristics of services markets: product, price, place, promotion, physical
evidence, people and processes.

A
Adaptation: (a) tailoring a product or other aspects of the marketing mix to
suit the different needs and demands of other markets, usually international;
(b) changing production methods or product specifications in a B2B market in
order to better meet an individual customer's requirements.

Advertising: a paid form of non-personal communication transmitted


through a mass medium.

Advertising media: the means through which advertisements are delivered


to the target audience. Media include broadcast media, print media, cinema,
hoardings and outdoor media.

Advertorial: a form of print advertising that is designed to mimic the


editorial content, style and layout of the publication in which it appears.

Agents and brokers: intermediaries who have legal authority to act on


behalf of a seller in negotiating sales, but who do not take title to goods
themselves.

Alternative currencies: trading stamps, tokens or loyalty scheme points


awarded on the basis of the amount spent by the customer that can be
accumulated and then exchanged for gifts or discounts.

Ansoff matrix: a framework for considering the relationship between


general strategic direction and marketing strategies. The four-cell matrix
looks at permutations of new/existing products and new/existing markets.

Atmosphere: (a) the elements that come together to make an impact on


retail customers' senses as they enter and browse in a store; (b) creating a
feeling appropriate to the character of the store and the desired mood of the
customers.

Attitude: the stance that individuals take on a subject that predisposes them
to act and react in certain ways.

Augmented product: add-on extras that do not form an integral part of the
product but which might be used, particularly by retailers, to increase the
product's benefits or attractiveness. Includes guarantees, installation, after-
sales service, etc.

Awareness: the consciousness that a product or organisation exists.

Back to the top

B
B2B goods: goods that are sold to organisations for: (a) incorporation into
producing other products; or (b) supporting the production of other products
directly or indirectly; or (c) resale.

B2B marketing: (also known as industrial marketing or organisational


marketing) activities directed towards the marketing of goods and services by
one organisation to another.

Banner advertising: advertising that appears on a website, usually as a


banner across the top of a page that clicks the user through to the
advertiser's website.

Behaviour segmentation: grouping consumers in terms of their relationship


with the product, for instance their usage rate, the purpose of use, their
willingness and readiness to buy, etc.

BIGIF: a form of product based sales promotion – buy one get one free also
known as BOGOFF.

Boston Box: (also known as the BCG matrix) a tool for analysing a product
portfolio, plotting relative market share against market growth rate for each
product. The resultant matrix classifies products as cash cows, dogs, question
marks and stars.

Brand loyalty: occurs when a consumer consistently buys the same brand
over a long period.

Branding: the creation of a three-dimensional character for a product,


defined in terms of name, packaging, colours, symbols, etc., that helps to
differentiate it from its competitors, and helps the customer to develop a
relationship with the product.

Breadth of range: the variety of different product lines either (a) produced
by a manufacturer; or (b) stocked by a retailer.

Breakeven analysis: shows the relationship between total costs and total
revenue in order to assess the profitability of different levels of sales volume.

Bulk breaking: buying large quantities of goods and then reselling them in
smaller lots, reflecting some of the cost savings made through bulk buying in
the resale price. A prime function of intermediaries.

Business format franchise: allows a franchisee access not only to a


product concept, but also to a comprehensive package that allows the
product or service to be delivered in a standardised way regardless of the
location.

Business to business marketing: see B2B marketing.

Buyer readiness stages: categorise consumers in terms of how close they


are to making a purchase or a decision. Stages range from initial awareness,
through to interest, desire and, finally, action.

Buyer–seller relationship: the nature and quality of the social and


economic interaction between two parties.

Buying centre: a group of individuals, potentially from any level within an


organisation or from any functional area, either contributing towards or
taking direct responsibility for organisational purchasing decisions. The
buying centre might be formally constituted, or be a loose informal grouping.

Back to the top

C
CAPI: computer aided personal interviewing.

Cash rebate: a form of sales promotion usually involving the collection of a


specified number of proofs of purchase in order to qualify for a cash sum or
for a coupon.

Catalogue showrooms: a High Street store selling goods through


catalogues displayed in the outlet, with the customer collecting goods
immediately from a pick-up point on the premises.

CATI: computer aided telephone interviewing.

Cause related marketing: linkages between commercial organisations and


charities that can be used by both parties to enhance their profiles and to
help achieve their marketing objectives.

Channel of distribution: the structure linking a group of organisations or


individuals through which a product or service is made available to potential
buyers.

Channel strategy: decision taken about the allocation of roles within a


channel of distribution, and the way in which the channel is formally or
informally managed and administered.

Closed questions: market research questions which offer the respondent a


limited list of alternative answers to choose from.

Closing the sale: the stage of the personal selling process in which the
customer agrees to purchase.

Cognitive dissonance: a state of psychological discomfort arising when a


consumer tries to reconcile two conflicting states of mind, for example, the
positive feeling of having chosen to buy a product and the negative feeling of
being disappointed with it afterwards.

Cold calling: unsolicited visits or calls made by sales representatives to


potential customers.

Collaborative R&D: pooling resources and expertise with one or more other
organisations to undertake a research and development project jointly.

Commission: a percentage of the value of goods sold paid as total or partial


remuneration to a sales representative or agent.

Comparative advertising: a type of advertising that seeks to make direct


comparison between a product and one or more of its competitors on features
or benefits that are important to the target market.

Competitive advertising: a commonly used type of advertising that


communicates the unique benefits of a product, differentiating it from the
competition.

Competitive edge: having a clear advantage over the competition in terms


of one or more elements of the marketing mix that is valued by potential
customers.

Competitive position: the organisation's strategic position in a market


compared with its competitors: leader, challenger, follower or nicher.

Competitive posture: an organisation's means of dealing with competitors'


actions in a market, proactively or reactively. Postures can be aggressive,
defensive, cooperative or independent.

Competitive strategy: how an organisation chooses to compete within a


market, with particular regard to the relative positioning and strategies of
competitors.
Concept testing: the presentation of a new product concept, in terms of its
function, benefits, design, branding, etc., to a sample of potential customers
to assess their reactions, attitudes and purchasing intentions towards it.

Concessions: (also known as stores within stores) trading areas usually


within department stores, sold, licensed or rented out to manufacturers or
other retail names so that they can create their own distinctive trading
image.

Consumer decision-making: the process that consumers go through in


deciding what to purchase, including problem recognition, information
searching, evaluation of alternatives, making the decision, and post-purchase
evaluation.

Consumer goods: goods that are sold to individuals for their own or their
families' use.

Contracting: a type of market entry method whereby a manufacturer


contracts with a company in a foreign market to produce or assemble goods
on its behalf.

Contests and sweepstakes: a form of sales promotion in which customers


are invited to compete for a specified number of prizes. Contests must
involve a degree of skill or knowledge, whereas sweepstakes are effectively
open lotteries.

Continuous innovation: products are upgraded and updated regularly in


relatively small ways that make no great changes to the customer's buying
behaviour.

Continuous research: research undertaken, usually by commercial market


research organisations, on a long-term, ongoing basis, to track changing
patterns in markets.

Control and evaluation: mechanisms for ensuring that marketing plans are
properly implemented, that their progress is regularly measured and
assessed and that any deviations are picked up early enough to allow
corrective action to be taken.

Convenience goods: relatively inexpensive frequently purchased consumer


goods; related to routine problem solving buying behaviour.

Convenience stores: usually small neighbourhood grocery stores that


differentiate themselves from the supermarkets through longer opening hours
and easy accessibility.

Conversion rate: the number of enquiries from potential customers or sales


visits made by sales representatives that actually turn into orders or sales.

Co-operative advertising: a form of sales promotion targeted at


intermediaries through which manufacturers agree to fund a percentage of
the intermediary's local advertising costs as long as the manufacturer's
product appears in the advertising material.

Copywriting: writing the verbal (written or spoken) elements of an


advertisement.

Core product: the prime purpose of a product's existence which might be


expressed in terms of functional or psychological benefits.

Corporate chain: multiple retail outlets under common ownership, usually


with national coverage.

Corporate identity: the character and image of an organisation, reflecting


its culture, that is presented to its various publics, including the organisation's
name and logo.

Corporate objectives: the overall objectives of the organisation that


influence the direction of marketing strategy.

Corporate PR: public relations activities focused on enhancing or protecting


the overall corporate image of an organisation.

Corporate social responsibility (CSR): the need for organisations to


consider the good of the wider communities, local and global, within which
they exist in terms of the economic, legal, ethical and philanthropic impact of
their way of conducting business and the activities they undertake. ‘The CSR
firm should strive to make a profit, obey the law, be ethical, and be a good
corporate citizen' (Carroll, 1991 see Chapter 1 references).

Count and recount: a form of sales promotion targeted at intermediaries


through which rebates are given for all stock sold during a specified
promotional period.

Coupons: a form of sales promotion consisting of printed vouchers,


distributed in a variety of ways, that allow a customer to claim a price
reduction on a particular product or at a particular retailer's stores.

Creative appeal: the way in which an advertising message is formulated in


order to provoke the desired response from the target audience. Types of
appeal include rational, emotional, product-orientated or consumer-orientated
appeal.

CSR: see corporate social responsibility.

Culture: the personality of the society in whichan individual lives, manifest in


terms of the built environment, literature, the arts, beliefs andvalue systems.

Cybermediary: an e-tailer that sells direct to the customer; also any online
intermediary that helps the individual to locate a specific website or guides
them towards sites of interest. Search engines, online shopping malls and
online directories are all cybermediaries.

Back to the top

D
Data-based budget setting: setting advertising or marketing budgets using
methods that do not involve guesswork or arbitrary figures. The two main
methods are competitive parity, and objective and task.

Database marketing: compiling, analysing and using data held about


customers in order to create better tailored, better timed offers that will
maximise customer value and loyalty.

Decision-making unit (DMU): see buying centre.

Demographic segmentation: grouping consumers on the basis of one or


more demographic factors.

Demographics: the measurable aspects of population structure, such as


birth rates, age profiles, family structures, education levels, occupation,
income and expenditure patterns.

Department stores: large stores, usually located in town centres, which are
divided into discrete departments selling a very wide range of diverse goods,
from clothing to travel, from cosmetics to washing machines.

Depth of range: the amount of choice or assortment within a product line.

Derived demand: where demand for products or components in B2B


markets depends on consumer demand further down the chain; for example
demand for washing machine motors is derived from consumer demand for
washing machines.

Differential advantage: see competitive edge.

Diffusion of innovation: a concept suggesting that customers first enter a


market at different times, depending on their attitude to innovation and new
products, and their willingness to take risks. Customers can thus be classified
as innovators, early adopters, early majority, late majority and laggards.

Direct export: selling goods to foreign buyers without the intervention of an


intermediary.

Direct mail: a direct marketing technique involving the delivery of


promotional material to named individuals at their homes or organisational
premises.
Direct marketing: an interactive system of marketing that uses one or more
advertising media to effect a measurable response at any location, forming a
basis for further developing an ongoing relationship between an organisation
and its customers.

Direct response advertising: advertising through mainstream advertising


media that encourages direct action from the audience, for example, requests
for more information, requests for a sales visit, or orders for goods.

Direct supply: a distribution channel in which the producer deals directly


with the end customer without the involvement of intermediaries.

Discontinuous innovation: represents a completely new product concept


unlike anything the customer has yet experienced, and thus involves a major
learning experience for the customer with much information searching and
evaluation.

Discount clubs: similar to wholesalers, but re-selling in bulk to consumers


who are members of the club rather than small retailers.

Disintermediation: cutting one or more intermediaries out of the


distribution channel.

Distributors and dealers: intermediaries who add value through the


provision of special services associated with the selling of a product and the
after- sales care of the customer.

Diversification: developing new products for new markets.

Dotcom: a company set up specifically to sell or deliver goods and/or


services via the internet.

DSS: decision support system; an extension of the MIS that allows the
marketing decision maker to manipulate data to explore scenarios and ‘what
if …' questions as an aid to decision-making.

Durable products: products that last for many years and are thus likely to
be infrequently purchased, such as electrical goods and capital equipment.

Dynamically continuous innovation: the introduction of new products with


an element of significant innovation that could require major reassessment of
the product within customers' buying behaviour.

Back to the top

E
E-mail marketing: the use of e-mail as a direct marketing channel.
E-marketing: the use of electronic media such as the internet, wireless
marketing and iTV for any marketing purpose.

E-tailer: an online retailer, including dotcom companies that sell


goods/services, online ‘branches' of High Street stores, and manufacturers'
online direct selling sites.

Economic and competitive environment: trends and developments in


terms of the economic well-being and condition of individuals, nations or
trading blocs, including taxation and interest rates, etc.; the structure of
markets in terms of the number of competitors and their ability to influence
the market.

Environmental scanning: the collection and evaluation of data and


information from the marketing environment that can influence the
organisation's marketing strategies.

EPOS: electronic point of sale systems which streamline stock control and
ordering systems through barcode scanning and allow the automatic
processing of credit card payments for goods.

Eurobrand: (also known as a pan-European brand) a brand which is


marketed and sold with a standardised offering across a number of different
European countries.

Evoked set: the shortlist of potential products that the consumer has to
choose from within the purchasing decision-making process.

Exchange process: the interaction between buyer and seller in which each
party gives the other something of value. Usually, the seller offers goods and
services, and the buyer offers money.

Extended problem solving: a purchasing situation usually involving a great


deal of time and conscious information searching and analysis, as it involves
high-priced goods which are purchased very infrequently; the consequences
of making a ‘wrong' decision are severe and thus the customer is prepared to
invest time and effort in the process.

Extending the product line: adding further product items into a product
line to extend coverage of the market, for instance introducing a bottom of
the range cut-price version of a product, or developing a premium quality
product to extend the top end of the range.

Back to the top

F
Family lifecycle: a model representing the way in which a family's structure
changes naturally over time.

Field marketing agencies: agencies which undertake in-store sales


promotions, sampling, and/or the setting up and maintenance of POS
material.

Filling the product range: adding further product items into a product line
to fill gaps within the range, for instance introducing additional flavours, pack
sizes or packaging formats.

Fmcg products: fast moving consumer goods; relatively low-priced,


frequently purchased items, such as groceries and toiletries.

Focus group: a small group of people, considered to be representative of the


target segment, invited to discuss openly products or issues at their leisure in
a relaxed environment.

Forecasts: estimates of future demand, sales or other trends, calculated


using quantitative and/or qualitative techniques.

Franchise: a contractual vertical marketing system in which a franchisor


licenses a franchisee to produce and market goods or services to criteria laid
down by the franchisor in return for fees and/or royalties.

Franchisee: an intermediary who holds a contract to supply and market a


product or service to operating standards and criteria set by the franchisor.

Franchisor: the individual or organisation offering franchise opportunities.

Frequency: the average number of times that a member of the target


audience will have been exposed to an advertisement during a specified
period.

Full service agencies: advertising agencies that provide a full range of


services, including research, planning, creative work, advertising production,
media buying, etc. Such agencies might also offer other marketing
communications services such as direct mail, sales promotion, and PR.

Back to the top

G
GE matrix: a tool for analysing a product portfolio, plotting industry
attractiveness against business position for each product, resulting in a nine-
cell matrix.

Generic strategies: three broad strategic options that set the direction for
more detailed strategic planning: cost leadership, differentiation and focus.
Geodemographics: a combination of geographic and demographic
segmentation that can either give the demographic characteristics of
particular regions, neighbourhoods and even streets, or show the geographic
spread of any demographic characteristics.

Geographic segmentation: grouping customers in either B2B or consumer


markets in terms of their geographic location.

Back to the top

H
Heterogeneity: a characteristic of services, describing how difficult it is to
ensure consistency in a service product because of its ‘live' production and
the interaction between different customers and service providers.

House journal: an internal publication produced by an organisation in order


to inform and entertain its employees and to generate better internal
communication and relationships.

Hypermarkets: very large self-service out-of-town outlets, 5,000 m2 or


more, stocking not only a wide range of grocery and fmcg products, but also
other consumer goods such as clothing, electrical goods, home maintenance
products, etc.

Back to the top

I
Independent retail outlet: a single retail outlet, or a chain of two or three
stores, managed by either a sole trader or a family firm.

Indirect export: selling goods to foreign buyers through intermediaries such


as export agents, export merchants or buying houses.

Industrial marketing: see B2B marketing.

Infomediaries: information brokers that gather information about online


consumers, their preferences and shopping habits and then sell it on to other
organisations and/or use it to act as a cybermediary on behalf of consumers
to help them locate appropriate sites.

Information overload: having so much information available that the


consumer either cannot assimilate it all or feels too overwhelmed to take any
of it in.

Inseparability: a characteristic of services, describing how service products


tend to be produced at the same time as they are consumed.
Institutional advertising: a type of advertising that does not focus on a
specific product, but on the corporate image of the advertiser.

Intangibility: a characteristic of services, describing their non-physical


nature.

Interactive marketing: (a) in services markets, the encounter and


interaction between the service provider and the customer. (b) see Internet
marketing.

Interactive television: (iTV) a means of providing two-way communication


between the consumer and the service provider using a television set-top box
sending and receiving signals via satellite, cable or aerial.

Intermediary: an organisation or individual through whom products pass on


their way from the manufacturer to the end buyer.

Internal marketing: the development and training of staff to ensure high


levels of quality and consistency in service delivery and support. Internal
marketing includes recruitment, training, motivation and productivity.

International marketing: a particular application of marketing concerned


with developing and managing trade across international boundaries.

Internet marketing: (also known as online marketing) the use of the


internet to disseminate information, communicate with the marketplace,
advertise, promote, sell and/or distribute products or services.

Inventory management: controlling stock levels within the physical


distribution function to balance the need for product availability against the
need for minimising stock holding and handling costs.

iTV: see Interactive television.

Back to the top

J
Joint demand: where demand for one product or component in a B2B
market is dependent on the supply or availability of another, for example a
computer assembler's demand for casings might depend on the supply or
availability of disk drives.

Joint promotion: sales promotion activity undertaken by two or more


brands or manufacturers jointly, for example collecting tokens from Virgin
Cola in order to get two Eurostar tickets for the price of one.

Joint ventures: a jointly owned company set up by two or more other


organisations: (a) as a means of market entry method; or (b) as a means of
pooling complementary resources and exploiting synergy.

Judgemental budget setting: setting advertising or marketing budgets


using methods that involve some degree of guesswork or arbitrary figures.
Methods include: arbitrary, affordable, percentage of past sales, and
percentage of future sales.

Back to the top

Back to the top

L
Layout: (a) in retailing, the arrangement of fixtures, fittings and goods in the
store; (b) in advertising, the arrangement of the various elements of a print
or poster advertisement.

Leads: names, addresses and/or other details of individuals or organisations


which could be potential customers.

Learning: the change in behaviour that results from experience and practice.

Licensing: an arrangement under which an organisation (the licensor) grants


another organisation (the licensee) the right to manufacture goods, use
patents, use processes, or exploit trade marks within a defined market. Often
used as an international market entry method.

Lifestyle segmentation: grouping consumers on the basis of psychographic


characteristics.

Limited problem solving: a purchasing situation usually involving some


degree of conscious information searching and analysis, as it involves
moderately high priced goods which are not purchased too frequently, and
thus the customer might be prepared to shop around to a limited extent.

Limited service agencies: advertising agencies that specialise in one or just


a few parts of the whole advertising process; for example they might
specialise in creative work, or media buying or advertising research.

Loading up: an objective of sales promotion, encouraging customers to


advance their buying cycles, i.e. to buy greater quantities of a product in the
short term than normal.
Logistics: the handling and movement of inbound raw materials and other
supplies as well as outbound physical distribution.

Back to the top

M
M-marketing: (also known as mobile marketing) see wireless marketing.

Macro segments: segments in B2B markets defined in terms of broad


organisational characteristics such as size, location and usage rates, or in
terms of product applications.

Mail order: a form of non-store retailing usually involving a catalogue from


which customers select goods, then mail or telephone their orders to the
supplier. Goods are delivered to the customer's home.

Mailing list: a list of names and addresses, which can be compiled from
organisational records or purchased, used as the basis for direct marketing
activities.

Manufacturer brands: branding applied to goods that are produced and


sold by a manufacturer who owns the rights to the brand.

Manufacturing subsidiary: a subsidiary company set up in a foreign


market to manufacture or assemble a product.

Mark-up: the sum added to the trade price paid for a product to cover the
intermediary's costs and profit. Mark-up can be measured as a percentage of
the trade price or as a percentage of the resale price.

Market coverage: ensuring that the product is made available through


appropriate intermediaries so that: (a) the potential customer can access it
as easily as possible; and (b) the product is properly displayed, sold and
supported within the channel of distribution. Market coverage might involve
intensive distribution, selective distribution or exclusive distribution.

Market development: selling existing products into new segments or


geographic markets.

Market entry methods: ways of getting into international markets,


including direct exporting, indirect exporting, licensing, franchising, sales or
manufacturing subsidiaries, joint ventures, or strategic alliances.

Market penetration: increasing sales volume in current markets.

Market potential: the total level of sales achievable in a market assuming


that every potential customer in that market is buying, that they are using
the product on every possible occasion, and that they are using the full
amount of product on each occasion.

Market segmentation: breaking a total market down into groups of


customers and/or potential customers who have something significant in
common in terms of their needs and wants or characteristics.

Marketing: creating and holding customers by producing goods or services


that they need and want, communicating product benefits to customers,
ensuring that goods and services are accessible, and that they are available
at a price that customers are prepared to pay.

Marketing audit: the systematic collection, analysis and evaluation of


information relating to the internal and external environments that answers
the question ‘Where are we now?' for the organisation.

Marketing concept: a philosophy of business, permeating the whole


organisation, that holds that the key to organisational success is meeting
customers' needs and wants more effectively and more closely than
competitors.

Marketing environment: the external world in which the organisation and


its potential customers have to exist, and within the context of which
marketing decisions have to be made.

Marketing mix: the combination of the 4Ps that creates an integrated and
consistent offering to potential customers that satisfies their needs and
wants.

Marketing objectives: what the organisation is trying to achieve through its


marketing activities during a specified period. Closely linked with corporate
objectives.

Marketing orientation: an approach to business that centres its activities


on satisfying the needs and wants of its customers.

Marketing plan: a detailed written statement specifying target markets,


marketing programmes, responsibilities, time-scales, controls and resources.
Plans may be short term or long term, strategic or operational in focus.

Marketing PR: public relations activities focused on particular products or


aspects of their marketing campaigns.

Marketing programmes: specific marketing actions, specified within the


marketing plan, involving the use of the marketing mix elements in order to
achieve marketing objectives.

Marketing research: the process of collecting and analysing information in


order to solve marketing problems.

Marketing strategy: the broad marketing thinking that will enable an


organisation to develop its products and marketing mixes in the right
direction, consistent with overall corporate objectives.

Master franchising: a franchisor grants an individual or organisation in a


particular country or other trading region the exclusive right to develop a
franchise network by sub-franchising within that territory.

Micro segments: segments in B2B markets defined in terms of detailed


organisational characteristics such as management philosophy, decision-
making structures, purchasing policies, etc.

MIS: marketing information system; the formalised collection, sorting,


analysis, evaluation, storage and distribution of marketing data.

Mobile marketing: (also known as m-marketing) see wireless marketing.

Modified re-buy: goods and services purchased relatively infrequently by


organisations which might want to update their information on available
products and suppliers before making a repeat purchase decision.

Money-based sales promotions: sales promotions that centre around


some kind of financial incentive: money-off packs, cash rebate offers, or
coupons.

Motivation: the driving forces that make people act as they do.

Multiple sourcing: the sourcing of a particular B2B good or service from


more than one supplier simultaneously.

Multivariable segmentation: using a number of different variables to


develop a rich profile of a target group of customers.

Back to the top

N
Negotiation: a give and take process between a buyer and a seller in which
precise terms of supply, specification, delivery, price, and after-sales service,
etc. are agreed.

New product development (NPD): the process of seeking and screening


new product ideas, analysing their commercial feasibility, developing and test
marketing the product and its associated marketing mix, launching the
product fully, then monitoring and evaluating its initial progress.

New task purchasing: goods and services that are purchased extremely
infrequently by organisations, and involve a high level of formalised
information collection and analysis before a purchasing decision is made.
Non-durable products: products that can only be used once or a few times
before replacement, such as groceries or office stationery.

Non-profit marketing: marketing activities undertaken by organisations


which do not have profit generation as a prime corporate objective, such as
charities, public sector health care, and educational establishments.

Back to the top

O
Online marketing: see Internet marketing.

Open-ended questions: market research questions which do not offer a


respondent a list of alternative answers. The respondents are encouraged to
answer spontaneously and to enter into explanation of their answers.

Opt-in: a mechanism by which an individual can signify agreement or


specifically request to be included on a telemarketing, direct mail or e-mail
marketing list.

Opt-out: a mechanism by which an individual can specifically request to be


excluded from or deleted from a telemarketing, direct mail or e-mail
marketing list.

Order maker: a sales representatives with responsibility for: (a) finding new
customers and making sales to them; and (b) actively increasing the volume
or variety of sales to existing customers.

Order taker: a sales representative who either has a set pattern of customer
contact or waits for customers to contact him/her when they want to buy.

Organisational marketing: (also known as industrial marketing or


business-to-business (B2B) marketing) activities directed towards the
marketing of goods and services by one organisation to another.

Out of town: describes large retail sites located away from the town centres
so that they are easily accessible to large numbers of car-borne shoppers.

Outsourcing R&D: commissioning other organisations or research bodies to


undertake specific research and development projects, rather than handling
them in-house.

Own-label brands: branding applied to goods that are produced by a


manufacturer on behalf of a retailer or wholesaler who owns the rights to the
brand.

Back to the top


P
Penetration pricing: setting prices low in order to gain as much market
share as possible as quickly as possible.

Perception: the way in which individuals analyse and interpret incoming


information and make sense of it.

Perishability: a characteristic of services, describing how service products


cannot be stored because they are produced and offered at particular
moments in time.

Permission marketing: developing a marketing campaign on the basis that


an individual or organisation has explicitly consented to being targeted, for
example through the use of opt-in and opt-out mechanisms.

Personal selling: interpersonal communication, often face to face, between


a sales representative and an individual or group, usually with the objective
of making a sale.

Personality: features, traits, behaviours and experiences that make each


person a unique individual.

Physical distribution: the handling and movement of outbound goods from


an organisation to its customers.

Pioneer advertising: advertising used in the early stages of a product


lifecycle to explain what a product is, what it can do and what benefits it
offers.

Political and legal environment: the governmental influences, at local,


national and European levels, that inhibit or encourage business; the legal
and regulatory frameworks within which organisations have to operate,
including national and European law, local by-laws, regulations imposed by
statutory bodies and voluntary codes of practice.

POS: point of sale; marketing communication activity, for example sales


promotions, displays, videos, leaflets, posters, etc., which appears in retail
outlets at the place where the product is displayed and sold.

Post-purchase evaluation: the stage after a product or service has been


purchased and used in which the consumer reflects on whether the product
met expectations, exceeded them or was disappointing.

Post-testing: evaluation undertaken during or after an advertising campaign


to assess its impact and effects.

Potential product: what the product could and should be in the future to
maintain its differentiation.

PR: see Public relations.

Premium price: a price which is distinctly higher than average to reflect


better product quality, exclusivity or status.

Pre-testing: showing an advertisement to a sample of the target audience


during its development to check whether it is conveying the desired message
in the desired way with the desired effect.

Press relations: cultivating good relationships between an organisation and


the media as an aid to public relations activities.

Price: a medium of exchange; what is offered in return for something else;


usually measured in terms of money.

Price comparison: using price as a means of comparing two or more


products in order tojudge: (a) their likely quality in the absence ofother
information; (b) which offers the best valuefor money.

Price differential: any difference in the prices charged for the same product
to different market segments or in different geographic regions.

Price elasticity of demand: the responsiveness of demand to changes in


prices. Elastic products are very responsive, so that a price increase leads to
a fall in demand, while inelastic products are very unresponsive and thus a
rise in price leads to little or no change in demand.

Price negotiation: bargaining between a buyer and a seller to agree a


mutually acceptable price.

Price objectives: what the organisation is trying to achieve through its


pricing, measured in financial or market share terms, and closely linked with
overall corporate and marketing objectives.

Price perception: a customer's judgement of a price in terms of whether it


is thought to be too high, about right or extremely good value for money; this
judgement might vary with different circumstances and is often formed in the
light of what other alternative products are available.

Price sensitivity: the extent to which price is an important criterion in the


customer's decision- making process; thus a price sensitive customer is likely
to notice a price rise and switch to a cheaper brand or supplier.

Pricing method: the means by which prices are calculated. Methods can be
cost-orientated, demand orientated, or competition-orientated.
Pricing policies and strategies: the overall strategic guidelines for the
pricing decision, specifying pricing's role within an integrated marketing mix.

Pricing tactics: short-term manipulation of price to achieve specific goals,


as for example in money-based sales promotions.

Primary research: marketing research specially commissioned and


undertaken for a specific purpose.

Problem recognition: the realisation, triggered by either internal or


external factors, that the consumer or the organisation has a problem that
can be solved through purchasing goods or services.

Product-based sales promotions: sales promotions that centre around


some kind incentive connected with the product: extra product free, BIGIF, or
samples.

Product development: selling new or improved products into existing


markets.

Product items: the individual products or brands that make up a product


line.

Product lifecycle (PLC): a concept suggesting that a product goes through


various stages in the course of its life: introduction, growth, maturity and
decline. At each stage, a product's marketing mix might change, as will its
revenue and profit profile.

Product lines: a group of products, closely related by production or


marketing considerations, that exists within the overall product mix.

Product manager: the individual within an organisation responsible for the


day-to-day management and welfare of a product or family of products at all
stages of their product lifecycle, including their initial development.

Product mix: the total sum of all the product items and their variants
offered by an organisation.

Product orientation: an approach to business that centres its activities on


continually improving and refining its products, assuming that customers
simply want the best possible quality for their money.

Product portfolio: the set of different products that an organisation


produces, ideally balanced so that some products are mature, some are still
in their growth stage while others are waiting to be introduced.

Product positioning: developing a product and associated marketing mix


that: (a) is ‘placed' as close as possible in the minds of target customers to
their ideal in terms of important features and attributes; and (b) clearly
differentiates it from the competition.

Product repositioning: refining the product and/or its associated marketing


mix in order to change its positioning either: (a) to bring it closer to the
customer's ideal; or (b) to move it further away from the competition.

Product specification: the criteria to which an organisational purchase must


conform in terms of quality, design, compatibility, performance, price, etc.

Production orientation: an approach to business that centres its activities


on producing goods more efficiently and cost effectively, assuming that price
is the only factor important to customers.

Promotional mix: the elements that combine to make an organisation's


marketing communications strategy: advertising, sales promotion, personal
selling, direct marketing and public relations.

Prospecting: in personal selling, finding new potential customers who have


the ability, authority and willingness to purchase.

Psychographics: (also known as lifestyle segmentation) defining consumers


in terms of their attitudes, interests and opinions.

Psychological pricing: using price as a means of influencing a consumer's


behaviour or perceptions, for example using high prices to reinforce a quality
image, or selling at £2.99 instead of £3.00 to make the product appear much
cheaper.

Pull strategy: a communications strategy that focuses on the end consumer


rather than other members of the channel of distribution. Thus a
manufacturer might focus on communication to consumers, rather than to
wholesalers or retailers, thus helping to pull the product down the channel.

Public relations (PR): a deliberate, planned and sustained effort to institute


and maintain mutual understanding between an organisation and its publics
(Institute of Public Relations definition).

Publicity: a tool of public relations focused on generating editorial media


coverage for an organisation and/or its products.

Publics: any group, with some common characteristic with which an


organisation needs to communicate, including the media, government bodies,
financial institutions, pressure groups, etc. as well as customers and
suppliers.

Purchasing policy: an organisation's preferences, systems and procedures


for purchasing including,for example, attitude towards favoured or approved
suppliers, single or multiple sourcing, and rulesand guidelines.

Purchasing situation: the context in which a consumer purchasing decision


is made, defined by the frequency of purchase, the risks involved, and the
level of information searching undertaken: routine problem solving, limited
problem solving, and extended problem solving.

Push strategy: a communications strategy that focuses on the next member


of the channel of distribution rather than on the end consumer. Thus a
manufacturer might focus on communication to wholesalers or retailers rather
than to consumers, thus helping to push the product down the channel.

Back to the top

Q
Qualified prospects: potential customers who have been screened to check
that they meet relevant criteria as potential purchasers, for example checking
their financial status or that they do actually needthe product.

Qualitative research: the collection of data that are open to interpretation,


for instance on attitudes and opinions, and that might not be validated
statistically.

Quantitative research: the collection of quantified data, for example sales


figures, demographic data, purchase frequency, etc., that can be subjected to
statistical analysis.

Back to the top

R
Rating scales: a form of multiple choice market research questionnaire
question in which respondents are asked to indicate their answer on a scale,
for example ranging from 1 to 5 where 5 = ‘strongly agree' and 1 = ‘strongly
disagree' with a given statement.

Reach: the percentage of the target market exposed to an advertisement at


least once during a specified period.

Reference groups: groups to which an individual belongs or to which the


individual aspires to belong, and which influence the individual's motivation,
attitudes and behaviour.

Relationship lifecycle: the evolution of buyer–seller relationships in B2B


markets, through stages including awareness, exploration, expansion,
commitment and dissolution.

Relationship marketing: a form of marketing that puts particular emphasis


on building a longer-term, more intimate bond between an organisation and
its individual customers.
Reminder and reinforcement advertising: a type of advertising, targeted
at consumers who have already tried and used the product before, that
reminds consumers of a product's continued existence and of its unique
benefits.

Repeat purchase: the purchase and use of a product on more than one
occasion by a particular customer.

Retailer: an intermediary which buys products either from manufacturers or


from wholesalers and resells them to consumers.

Rolling launch: the gradual launch of a new product, region by region.

Routine problem solving: a purchasing situation usually involving low-risk,


low-priced, regularly purchased goods, which does not involve much, if any,
information searching or analysis on the part of the buyer.

Routine re-buy: goods and services purchased frequently by organisations


from established suppliers, with little, if any, formal decision-making involved
in the repeat purchase.

Back to the top

S
Sales orientation: an approach to business that centres its activities on
selling whatever it can produce, assuming that customers are inherently
reluctant to purchase.

Sales potential: the share of a total market that the organisation can
reasonably expect to capture.

Sales presentation: the stage of the personal selling process in which the
sales representative outlines the product's features and benefits.

Sales promotion: usually short-term tactical incentives offering something


over and above the normal product offering to encourage customers to act in
particular ways.

Sales quotas: the sales targets that a sales representative has to achieve,
broken down into individual product areas and specified as sales value or
volume.

Sales subsidiaries: a subsidiary company set up in a foreign market to


handle marketing, sales, distribution and customer care in that market.

Sampling: (a) a form of product-based sales promotion involving the


distribution of samples of products in a variety of ways, so that consumers
can try them and judge them for themselves; and (b) in market research, the
process of setting criteria and then selecting the required number of
respondents for a research study.

Sampling process: defining the target population for a market research


study; finding a means of access to that population, and selecting the
individuals to be surveyed within that population.

Secondary research: data which already exist in some form, having been
collected for a different purpose, perhaps even by a different organisation,
and which might be useful in solving a current problem.

Self-liquidating offers: a form of merchandise-based sales promotion that


invites the consumer to send cash, and often proofs of purchase, in return for
merchandise. The price charged covers the cost of the merchandise and a
contribution to handling and postage.

SEM: single European market; since 1992, completely free trade has been
possible between member states of the EU, although the process of
harmonising marketing regulations, product standards, tax rates, etc. is an
ongoing process that has not yet been fully achieved.

Semi-structured interview: a form of market research that involves some


closed questions for collecting straightforward data and some open-ended
questions to allow the respondent to explain more complex feelings and
attitudes, for example.

Services: goods that are largely or mainly non-physical in character, such as


personal services, travel and tourism, medical care or management
consultancy.

Shell directional policy matrix: a tool for analysing a product portfolio,


plotting competitive capability against prospects for sector profitability for
each product, resulting in a nine-cell matrix.

Shopping goods: consumer goods purchased less frequently than


convenience goods, and thus requiring some information search and
evaluation; related to limited problem solving buying behaviour.

SIC code: standard industrial classification; a means of categorising


organisations in terms of the nature of their business.

Single sourcing: the sourcing of a particular B2B good or service from only
one supplier.

Skimming: setting prices high in order to attract the least price-sensitive


customers and to generate profit quickly before competitors enter the market
and start to force prices down.

Slice of life: a style of advertising that shows how the product fits into a
lifestyle that is similar to that of the target audience, or represents a lifestyle
that they can identify with or aspire to.

Small business: small businesses are usually defined as those with fewer
than 100 employees.

Social class: a form of stratification that structures and divides a society,


often on the basis of income and occupation, for marketing purposes.

Sociocultural environment: trends and developments within society as a


whole, affecting the demographic structure of the population, lifestyles,
attitudes, culture, issues of public and private concern, tastes and demands.

Source credibility: the trustworthiness, likeability, respect or expertise of


the perceived source of a marketing message in the minds of the target
audience. Source credibility might be transferable to the actual subject of the
message, or might at least ensure that the message is listened to.

Speciality goods: expensive, infrequently purchased consumer goods;


related to extended problem solving buying behaviour.

Speciality stores: stores which tend to concentrate on one clearly defined


product area, focusing on depth of range.

Sponsorship: the provision of financial or material support to individuals,


teams, events or organisations, outside the sponsor's normal sphere of
operations. This might involve sport, the arts, community or charity work.

Standardisation: a deliberate strategy to maintainthe same product and


marketing mix across all international markets without adapting it for local
conditions.

STEP factors: the four broad categories of influences that create the
marketing environment: sociocultural, technological, economic and
competitive, and political and legal.

Store image: the positioning of a store in terms of its branding, product


selection, interior and exterior design, fixtures and fittings, lighting, etc.

Storyboard: part of the process of developing a television or cinema


advertisement, a storyboard shows sketches of the main scenes in the
advertisement, describes what is happening at that point, and what sound
effects should be used.

Strategic alliance: a collaborative agreemententered into by two or more


organisations with a specific purpose in mind. It might include joint ventures
or looser arrangements that do not involve any equity stakes.

Strategic business unit (SBU): a group of products, markets or operating


divisions with common strategic characteristics, that is a profit centre in its
own right. An individual product, market or operating division could also be
defined as an SBU if appropriate.

Strong theory of communication: a theory that assumes that marketing


communication takes the potential buyer through the buyer readiness stages
in sequence, thus forming attitudes and opinions before a purchase has taken
place.

Supermarkets: self-service stores carrying a wide range of grocery and


fmcg products, with smaller branches located in town centres and larger
stores located on out-of-town sites.

Sustainable marketing: the establishment, maintenance and enhancement


of customer relationships so that the objectives of the parties involved are
met without compromising the ability of future generations to achieve their
own objectives.

Switchers: consumers who are not loyal to any one brand of a particular
product and switch between two or more brands within the category.

SWOT analysis: a technique that takes the findings of the marketing audit
and categorises key points as strengths, weaknesses, opportunities or
threats.

Back to the top

T
Tangible product: the way in which the concept of the core product is
turned into something ‘real' that the customer can interact with, including
design, quality, branding, and product features.

Targeting: deciding how many market segments to aim for and how to do it.
There are three broad targeting strategies: concentrated, differentiatedand
undifferentiated.

Technological environment: trends and developments in the technological


field that might: (a) improve production; (b) create new product
opportunities;(c) render existing products obsolete; (d) change the ways in
which goods and services are marketed; or (e) change the profile of
customers' needs and wants.

Telemarketing: using the telephone: (a) to make sales directly; or (b) to


develop customer relationships and customer care programmes further. Calls
might be: (a) outbound, instigated by the organisation; or (b) inbound,
instigated by the customer.

Teleshopping: a form of non-store retailing including shopping by telephone


and shopping via computer networks.
Tendering: where potential suppliers bid competitively for a contract,
quoting a price to the buyer.

Test marketing: the stage within the new product development process in
which a product and its associated marketing mix are launched within a
confined geographic area to get as realistic a picture as possible of how that
product is likely to perform when fully commercialised.

Trade shows and exhibitions: centralised events, large or small, local or


international, focused on an industry or a product area, that bring together a
wide range of relevant suppliers and interested customers under one roof.

Trading up: an objective of sales promotion, encouraging customers either


to buy bigger sized packs of products, or to buy the more expensive products
in a range.

Transfer pricing: prices charged for the exchange of goods and services
between different departments or operating divisions within the same
organisation.

Trial: the purchase and use of a product for the first time by a particular
customer.

Trial price: a very low or minimal temporary price often used for new
products to encourage consumers to try them.

Trial sizes: a form of product-based sales promotion involving the sale of


products in smaller than normal packs, so that consumers can buy and try
them with minimal risk.

Back to the top

U
Unsought goods: goods that consumers did not even know they needed
until either (a) an emergency arose that needed an immediate purchasing
decision to help resolve it; or (b) an aggressive sales representative
pressurised them into a purchase.

Back to the top

V
Value: a customer's assessment of the worth of what they are getting in
terms of a product's functional or psychological benefits.

Value management: the analysis of products and processes to see where


the greatest costs are being incurred and where the greatest value is added.
This can lead to cost savings and better value for money to the customer.

Variety stores: smaller than department stores, variety stores stock a


relatively limited number of different product categories, but in greater depth.

Vertical marketing systems: a channel of distribution which is viewed as a


coordinated whole and is effectively managed or led by one channel member.
The leadership might be contractual, or derived from the power or dominance
of one member, or arise from the ownership of other channel members by
one organisation.

Viral marketing: the marketer uses electronic media to stimulate and


encourage word-of-mouth or electronic message dissemination between
individuals.

Back to the top

W
Weak theory of communication: a theory that assumes that marketing
communication creates awareness of products, but that attitudes and
opinions are only created after purchase and trial.

Wholesaler: an intermediary which buys products in bulk, usually from


manufacturers, and resells them to trade customers, usually small retailers.

Wireless marketing: (also known as m-marketing or mobile marketing) the


use of text messaging via a mobile telephone as a means of marketing
communication.

Back to the top

Back to the top

Back to the top

Z
Back to the top

A|B|C|D|E|F|G|H|I|J|K|L|M|N|O|P|Q|R|S|T|U|V
|W|X|Y|Z

Copyright © 1995-2004 by Pearson Education