Glossary of Marketing Terms
We have included definitions of some commonly utilised terms within the field of marketing.
Analysis
This is the process of examining a situation and all of the surrounding impacting elements and developing a deep understanding of all of these factors.
Ansoff Growth Matrix
This is a matrix which helps to develop an understanding of which growth strategy is the most suited to the particular situation that a particular business is facing at a particular point of time.
Brainstorming
This is the process of using a group of individuals to think of ideas to create a solution to a particular problem or issue.
Clutter
This is where a large number of advertising messages are presented within one medium or during one time period. The greater the level of clutter, the less likely an advertising message is to be successful at communicating its message.
Cognitive Dissonance
This is described as a feeling of post purchase regret. This occurs when you purchase something and it does not meet or exceed your expectations of value.
ConsumersThese are people who want to buy products or services. In effect everyone in the world is a consumer.
Consumer BehaviourThis is the study of how consumers behave when purchasing products within the marketplace.
CompetitorsThese are rival businesses which offer the same, similar or substitute products to the same market segment that your business is targeting.
Customers
These are consumers who demand and purchase the products or services that you have to sell.
Economics
This is the study of how firms and the economy will react to changes in the surrounding environment including fluctuations in supply and demand.
Goods Dominant Products
These are products which are tangibly based such as a stapler; they are easily recognisable and can be viewed and touched before being purchased. The level of variation within these types of products is generally low.
Goods dominant products still have service components associated with them; however the majority of the product is tangibly based. These types of products are easier to market because they make it easier for the consumers to evaluate them prior to making a purchase decision.
Integrated Branding and Marketing
This form of planning recognizes the long-term power of branding and that a coordinated approach is better method of achieving a consistent message and more effective results across the organisational spectrum. Branding is not the sole responsibility of one individual department, its effectiveness is the result of dedicated marketing-focused activities by everyone within the business.
An integrated branding and marketing plan ensures that all marketing and branding activities work together harmoniously in order to increase the organisations chances of achieving its objectives.
Marketing Mix
Traditionally the marketing mix was made up of 4 P’s:
- Product
- Place
- Price
- Promotion
New research in the academic field of marketing has indicated that the new marketing mix should include 3 additional elements which are:
- People
- Processes
- Physical Evidence
The 3 extra factors help in ensuring consistency and effectiveness of marketing activities for businesses with a high level of service dominant products.
Market Orientation
This is the degree to which a firm is in touch and orientated towards changes in needs and demands from the market that they operate in.
Market Research
This is the process of collecting information on the environment within which your organisation operates. It can be used to identify the most profitable market segments as well as the wants and needs of these competitors. Research can also be used to evaluate your businesses position within the market place in relation to competitors and the overall market perception of your business as well as its products and services.
Market Share
This is the statistical representation of the proportion of customers within the market segment who purchase from your organisation as opposed to your competitors organisation.
Market share is a good determinant of your businesses position within the market place, it is a good indicator as to whether your business is a market leader or a market follower. Remember the position of market leader is not always the most attractive.
Medium
A medium is the type of promotional element that you use to present your advertising message. Some examples of mediums are radio, television or print.
Noise
This is anything which could influence or interfere with the effectiveness of an advertising message adversely.
Products
These are what your business sells to its customers. A product is made up of both services and goods.
Product Life Cycle Model
This is a marketing model which shows the general inverted bell curve stages of a product's life from introduction to growth to maturity and to decline. This is useful in determining when to use a particular marketing strategy.
Product Placement
This is the process of using movies, TV shows or print mediums to position a product in such a way that a credible source is effectively providing an endorsement of the product without saying anything. Examples of product placement include movie stars drink soft drinks during a movie.
Cigarette and alcohol companies have often been accused of utilising product placement to bypass advertising regulations and create a perception of coolness around their potentially lethal products.
Qualitative Research
This is research which uses personal interaction to generate emotive responses from participants in relation to a particular issue, product, business or service. Qualitative research will usually involve the use of either in-depth interviews or focus groups.
Both focus groups and in-depth interviews are great at generating an insight into the minds of the community and your targeted market segments. The downside of these techniques includes group think and the halo effect, both of which inevitably result in bias results.
Quantitative Research
This is statistically based research, which usually involves the usage of a questionnaire or similar piece of documentation to gather statistical data on areas of interest. The collected information is then analysed to produce statistical results which help to establish trends within the sample population.
Quality
This is the evaluation of how well a product or service delivers upon its promises.
SalesThis usually involves the process of personal selling, sales refers directly to the amount of money generated and the statistical representation of the number of products that have been sold to customers.
Sales are normally high pressure focused and if it isn’t regulated in an effective manner, it is likely to result in greater harm than benefit for your business.
Satisfaction
Contrary to popular belief, that satisfaction is when consumer expectations are met, current marketing theory indicates that satisfaction is only achieved when consumer’s expectations are exceeded.
Segmentation
This is the process of separating the market into groups of individuals who share common traits. Generally segmentation is based upon psychographic, demographic, geographic and behavioural traits. Segmentation is used to determine the most potentially profitable target market for a business to focus its marketing efforts on. Marketing segments need to be accessible, actionable, defendable and sustainable in order to be effective.
Service Dominant Products
These are products which are intangibly based. Potential customers must rely upon quality cues to evaluate the potential results from purchase. These products are perishable, heterogeneous, intangible and inseparable. They are much more difficult to market than goods dominant products and rely heavily upon customer testimonials and word of mouth.
Shared Field of Experience
This is an important factor that to a large extent determines the effectiveness of marketing communications. In order for a message to be communicated effectively it is important that the sender and the receiver have a level of shared field of experience. This means that they have experienced similar things within their lives and can therefore relate and be related to by each of the parties.
Strategies
These are well-engineered ideas designed to achieve specific objectives within a specified period of time. A strategy should consider all factors that may impact on the ability of an organisation to achieve its objectives. The best strategies are developed out of a deep understanding of the related underlying issues.
Subliminal Advertising
This technique has in actuality been shown to have little or no effect on influencing consumers towards a purchase of a product or service. The idea is to place hidden advertising messages within print, television or radio advertisements in order to subconsciously influence consumers. The practice is ineffective, un-ethical and in some countries illegal and should not be used in any circumstance.
Sustainable Competitive Advantage (SCA)
This is when your business does something that is meaningfully different from what your competitors do and it is done in such a way that it generates value for your customers and it is sustainable.
Target Market
This is the group or groups of individuals that are distinct from the rest of the market and share common characteristics that make them more likely to want to purchase your businesses products or services. Marketing, promotion and advertising activities should be directed at this group of people.
Value
Unlike quality value relates to personal situations which each individual is facing. A BMW will generally be considered by most people to be a good quality car, but only those people who earn a more proportional income to the price tag of the vehicle will consider it to be of good value.
Word of Mouth (WOM)
This is by far the most effective form of advertising, as it comes with a good solid dosage of instant credibility. The benefit of word of mouth is that the person who is providing the information about the product or service of concern, is usually associated with the person that they are communicating to.
The relationship that exists is normally based upon a friendship or family acquaintance which means that there is an inherent level of trust that is intrinsically affiliated with all communications between the two respective parties in question.
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