Marketing 360 - BOOM
Terms
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- Augmented service
- The core service plus additional services provided to enhance value. Ex: valet parking at the basketball game.
- Capacity Management
- The process by which organizations adjust their offerings in an attempt to match demand.
- core service
- The basic benefit of having a service performed. Ex: basketball game.
- credence qualities
- Product characteristics that are difficult to evaluate even after they have been experienced.
- critical incident technique
- A method for measuring service quality in which marketers use customer complaints to identify (& record) critical incidents—specific face-to-face contacts between consumer and service providers that cause problems and lead to dissatisfaction. By tracking these down a service provider can improve their service act.
- experience qualities
- Product characteristics that customers can only judge during or after consumption. Ex: the taste of a latte.
- gap analysis
- A marketing research method that measures the difference between a customer’s expectation of a service quality and what actually occurred.
- inseparability
- The characteristic of a service that means that it is impossible to separate the production of a service from the consumption of that service. (Ex: a haircut is produced when a client arrives).
- intangibility
- The characteristic of a service that means customers can’t see, touch, or smell good service.
- perishability
- The characteristic of a service that makes it impossible to store for later sale or consumption.
- service encounter
- The actual interaction between the customer and the service provider.
- services
- Intangible products that are exchanged directly from the producer to the customer.
- servicescape
- The actual physical facility where the service is performed, delivered, and consumed. Smart service providers place quality cues in their servicescape to increase consumer beliefs they are receiving a high-quality service (ex: avant-garde lighting, great music, wallpaper, uniforms, couches etc.). The servicescape is part of the product.
- serqual
- A multiple-item survey scale used to measure service quality across the dimensions of tangibles, reliability, responsiveness, assurance, and empathy.
- variability
- The characteristic of a service that means that even the same service performed by the same individual for the same customer can vary. (Ever had the same meal at the same restaurant and it not be the same?)
- bait and switch
- An illegal marketing practice in which an advertising price special is used as bait (like baiting fish) to get customers into the store with the intention of switching them to a higher priced product. Its illegal to not have the advertised product (or provide rain checks for them).
- basing point pricing
- A pricing tactic in which customers pay shipping charges from set basing-point geographical locations, whether the goods are actually shipped from these points or not. See FOB (location) below.
- break-even-analysis
- A method for determining the number of units that a firm must produce and sell at a given price to cover all its costs.
- break even point
- the point at which the total revenue and total costs are equal and beyond which the company makes a profit; below that point, the firm will suffer a loss.
- captive pricing
- A pricing tactic for two items that must be used together; one item is priced very low, and the firm makes its profit on another, high-margin item essential to the operation of the first item (HP ink-jet cartridges, Sony RAM)
- contribution per unit
- The contribution from each sale to fixed costs and profits. The difference between the price the firm charges for a product and the variable costs.
- cost-plus pricing
- A method of setting prices in which the seller totals all the costs for the product and then adds the amount to arrive at the selling price.
- cross-elasticity of demand
- When changes in the price of one product affect the demand for another item. For ex: when sales of gelatto or sherbert go down, the sales of ice-cream fall as well.
- demand based pricing
- A price-setting method based on estimates of demand at different prices.
- demand-based pricing
- A price-setting method based on estimates of demand at different prices.
- dynamic pricing
- A pricing strategy in which the price can easily be adjusted to meet changes in the marketplace.
- elastic demand
- Demand in which changes in price have large effects on the amount demanded.
- F.O.B. location pricing
- Mostly a B2B term that is negotiable. Its a pricing tactic. If the terms are FOB Seattle then the selling price includes the cost of loading and transporting the product to Seattle. The customer has to pick up the product in Seattle. If the terms are FOB Pullman, then the sales price includes shipment to Pullman.
- fixed costs
- Costs of production that do not change with the number of units produced.
- freight absorption pricing
- A pricing tactic where the price of product is calculated to include shipping.
- list price
- The price the end customer is expected to pay as determined by the manufacturer; also referred to as the suggested retail price or MSRP.
- loss leader pricing
- A retail or manufacturer pricing policy of setting prices very low or even below cost on one product or one product line to attract customers into a store. The retail store of mfr will make up the lost earnings on the sale of other products that occur when the consumer is in the store.
- marginal analysis
- A method that uses cost and demand to identify the price that will maximize profits.
- marginal cost
- The increase in total cost that results from producing one additional unit of a product.
- marginal revenue
- The increase in total income or revenue that results from selling one additional unit of a product.
- predatory pricing
- Illegal pricing strategy in which a company sets a very low price for the purpose of driving competitors out of business.
- prestige product
- Products that have a high price and that appeal to status-conscious consumers.
- price
- The assignment of value, or the amount the consumer must exchange to receive the offering.
- price bundling
- Selling two or more goods or services as a single package for one price.
- price elasticity of demand
- The percentage change in unit sales that results from a percentage change in price. A higher ration (>1.0) indicates a more price inelastic demand.
- price fixing
- The collaboration of two or more firms in setting prices, usually to keep prices high. Airlines used to do this much more.
- price leadership
- A pricing strategy in which one firm first sets its price and other firms in the industry follow with the same or vary similar prices.
- price lining
- The practice of setting a limited number of different specific prices, called price points, for items in a product line.
- quantity discounts
- A pricing discount of charging reduced prices for purchases of larger quantities of a product.
- target costing
- A process in which firms identify the quality and functionality needed to satisfy customers and what price they are willing to pay before the product is designed; the product is manufactured only if the firm can control costs to meet the required price.
- total costs
- The total of the fixed costs and the variable costs for a set number of units produced.
- trade or functional discounts
- Discounts off list price of products to members of the channel of distribution who perform various marketing functions.
- trial pricing
- Pricing a new product low for a limited period of time in order to lower the risk for a customer.
- unfair sales act
- State laws that prohibit suppliers from selling products below cost to protect small businesses from larger competitors.
- uniform delivered pricing
- A pricing tactic in which a firm adds a standard shipping price to the price for all customers regardless of the location.
- value pricing or everyday low pricing (edlp)
- A pricing strategy in which a firm sets prices that provide ultimate value to customers.
- variable costs
- The cost of production (raw and processed materials, parts, and labor) that are tied to and vary depending on the number of units produced.
- yield management pricing
- A practice of charging different prices to different customers in order to manage capacity while maximizing revenues.
- breaking bulk
- Dividing larger quantities of goods into smaller lots in order to meet the needs of the buyers.
- channel intermediaries
- Firms or individuals such as wholesalers, agents, brokers, or retailers who help move a product from the producer to the consumer or business user.
- channel leaders
- A firm at one level of distribution that takes a leadership role, establishing operating norms and processes based on its power relative to other channel members.
- channel levels
- The number of distinct categories of intermediaries that populate a channel of distribution.
- channel of distribution
- The series of firms or individuals that facilitates the movement of a product from the producer to the final customer.
- conventional marketing system
- A multiple-level distribution channel in which channel members work independently of one another.
- creating assortments
- Providing a variety of products in one location to meet the needs of the buyers.
- disintermediation (of channel of distribution)
- The elimination of some layers of the channel of distribution in order to cut costs and improve the efficiency of the channel.
- enterprise resource planning
- A software system that integrates information from across the entire company, including finance, order fulfillment, manufacturing and transportation and then facilitates sharing of the data throughout the firm.
- exclusive distribution
- Selling a product only through a single outlet in a particular region.
- facilitating functions
- Functions of channel intermediaries that make the purchase process easier for customers and manufacturers (i.e. breaking bulk, creating assortments, transport product, facilitate info flow, handle movement of product through customs, consolidate orders, extend credit).
- horizontal marketing system
- An arrangement within a channel of distribution in which two or more firms at the same channel level work together for a common purpose (i.e. members of IGA-Independent Grocers of America consolidating orders to reap volume discounts).
- hybrid marketing system
- A marketing system that uses a number of different channels and communications methods to serve as target market.
- insourcing
- A practice in which a company contracts with a specialist firm to handle all or part of its supply chain operations.
- intensive distribution
- Selling a product through all suitable wholesalers or retailers that are willing to stock and sell the product.
- inventory control
- Activities to ensure that goods are always available to meet customers’ demands.
- just in time
- Inventory management and purchasing processes that manufacturers and resellers use to reduce inventory to very low levels and ensure that deliveries from suppliers arrive only when needed.
- knowledge management
- A comprehensive approach to collecting, organizing, storing, and retrieving a firm’s information assets.
- logistics
- The process of designing, managing, and improving the movement of products through the supply chain. Logistics include purchasing manufacturing, storage, and transport.
- materials handling
- The moving of products into, within, and out of warehouses.
- merchandise agents or brokers
- Channel intermediaries that provide services in exchange for commissions but never take title to the product.
- merchant wholesalers
- Intermediaries that buy goods from the manufacturers (take title to them) and sell to retailers and other business-to-business customers.
- online distribution piracy
- The theft and unauthorized repurposing of intellectual property via the Internet.
- order processing
- The series of activities that occurs between the time an order comes into the organization and the time a product goes out the door.
- physical distribution
- The activities that move finished goods from manufacturers to final customers, including order processing, warehousing, materials handling, transportation, and inventory control.
- radio frequency identification RFID
- Product tags with tiny chips containing information about the item’s content, origin, and destination.
- selective distribution
- Distribution using fewer outlets than intensive distribution but more than exclusive distribution.
- slotting allowance
- A fee paid in exchange for agreeing to place a manufacturer’s products on a retailer’s valuable shelf space.
- supply chain
- All the activities necessary to turn raw materials into a good or service and put it in the hands of the consumer or business customer.
- take title
- To accept legal ownership of a product and assume the accompanying rights and responsibilities of ownership.
- transportation
- The mode by which products move among channel members.
- value chain
- A series of activities involved in designing, producing, marketing, delivering, and supporting any product. Each link in the chain has the potential to either add or remove value from the product the customer eventually buys. Value chain is a larger concept that supply chain as it includes engineering, marketing, etc. SCM focuses on sourcing, production, capacity planning and distribution.
- vertical marketing system
- A channel of distribution in which there is formal cooperation among members at the manufacturing, wholesaling, and retailing levels.
- warehousing
- Storing goods in anticipation of sale or transfer to another member of the channel of distribution.
- wholesaling intermediaries
- Firms that handle the flow of products from the manufacturer to the retailer or business user.
- promotion
- The coordination of a marketer’s communication efforts to influence attitudes or behavior
- integrated marketing communication (IMC)
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A strategic business process that marketers use to plan, develop, execute, and evaluate coordinated, measurable, persuasive brand communication programs over time to targeted audiences.
- communicational model
- The process whereby meaning is transferred from a source to a receiver.
- encoding
- The process of translation an idea into a form of communication that will convey meaning.
- source
- An organization or individual that sends a message.
- message
- The communication in physical form that goes from a sender to a receiver
- medium
- A communication vehicle through which a message is transmitted to a target audience.
- receive
- The organization or individual that intercepts and interprets the message.
- decoding
- The process by which a receiver assigns meaning to the message.
- noise
- Anything that interferes with effective communication.
- feedback
- Receivers’ reactions to the message
- promotion mix
- The major elements of marketer-controlled communication, including advertising, sales promotion, public relations, personal selling, and direct marketing.
- word of mouth
- When consumers provide information about products to other consumers.
- word of mouth marketing
- Giving people a reason to talk (buzz) about your products and making it easier for that conversation to take place.
- buzz marketing
- Using consumers to promote your product for you to people they know.
- viral marketing
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Creating entertaining or informative messages that are designed to be passed along in an exponential fashion, electronically or by e-mail.
- buzz
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Word of mouth communication about a product or company that customers view as authentic not BS hype.
- guerilla marketing
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Marketing activity in which a firm “ambushes†consumers with promotional content in places they are not expecting to encounter this kind of activity.
- experiential marketing
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Marketing activities that attempt to give customers an opportunity to actually interact with brands, thus enabling them to make more intelligent and informed purchase decisions.
- consumer generated media (CGM)
- The on-line consumer-generated comments, opinions, and product-related stories available to other consumers through digital technology.
- database marketing
- The creation of an ongoing relationship with a set of customers who have an identifiable interest in a good or service and whose responses to promotional efforts become part of future communication attempts.
- hierarchy of effects
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A series of steps prospective customers move through, from initial awareness of a product to brand loyalty.
- top down budgeting techniques
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Allocation of the promotion budget based on management’s determination of the total amount to be devoted to marketing communication.
- percentage of sales
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A method for promotion budgeting that is based on a certain percentage of either last year’s sales or on estimates for the present year’s sales.
- competitive parity method
- A promotion budgeting method in which an organization matches whatever competitors are spending.
- bottom-up budgeting techniques
- Allocation of the promotion budget based on identifying promotion goals and allocating enough money to accomplish them.
- objective task method
- A promotion budgeting method in which an organization first defines the specific communication goals it hopes to achieve and then tries to calculate what kind of promotional efforts it will take to meet these goals.
- push strategy
- The company tries to move its products through the channel by convincing channel members to offer them.
- pull strategy
- The company tries to move its products through the channel by building desire for the products among consumers, thus convincing retailers to respond to this demand by stocking these items.
- AIDA model
- The communication goals of attention, interest, desire, and action.