30 IMPORTANT MARKETING TERMS

1. 30IMPORTANT MARKETING TERMS NOTE: ALL THESE TERMS/DEFINITIONS WILL BE TESTED ON THE FINAL EXAM IN JUNE

2. Added Value • The increased worth of a firm’s offering as a result of marketing. • Four factors which generate the additional value are features, quality, customer perception (or image) and exclusiveness.

3. Ad Hoc Marketing Research • Marketing Research conducted in response to a specific, one-time-only need.

4. Adversarial Shopper • A consumer whose shopping behaviour is characterized by a determination to get good value at a low price; a bargain hunter; one who regards all prices as negotiable.

5. Advertising Elasticities • The measurements of the effect on other marketing variable of various levels of advertising expenditure. • Eg: The measurement of the effect of high levels of advertising expenditure on price.

6. Atmospherics • The combination of store décor, physical characteristics and amenities provided by a retailer to develop a particular image and attract customers.

7. Augmented Product • A product enhanced by the addition of related services and benefits. • Eg. Installation, warranty, maintenance and repair services.

8. Bait Advertising • An advertising practice in which attractive, low cost goods (few or any of which are in stock) are advertised to attract buyersto a store or selling place. • Bait Advertising is now illegal in many countries.

9. Brand Harvesting • Decreasing marketing expenditure on a brand to zero, or to a minimal level, when sales and profit begin to decline, relying on its purchase by loyal customers to sustain it. • Brand harvesting is usually undertaken to free up resources for other marketing campaigns.

10. Brand Promiscuity • Consumer buying behaviourmarked by an absence of brand loyalty.

11. Cannibalisation • The loss of sales of an existing product to a new offering in the product line.

12. Caveat Emptor • A latin term meaning “let the buyer beware”. • The term implies that it is the customer’s responsibility rather than the seller’s to ensure that the goods or services offered for sale are able to deliver the desired satisfaction. • Caveat Emptor is totally contrary to the marketing concept.

13. Cognitive Dissonance • Doubt that surfaces when a buyer becomes aware that an alternative product may offer more desirable benefits than the one purchased. • The buyer wonders whether the right choice has been made.

14. Cold Calling • Making a sales call on a client without an appointment.

15. Demarketing • Marketing aimed at limiting growth; practiced, for example, by governments to conserve natural resources or by companies unable to serve adequately the needs of all potential customers.

16. Differential Pricing • A pricing strategy in which a company sets different prices for the same product on the basis of different customer type, time of purchase etc.

17. Galvanometer • A scientific instrument used in marketing research to measure the reaction of a person to an advertisement. • The instrument measures the perspiration that accompanies the person’sinterest or arousal.

18. Generic Advertising • Advertising a category or class of product rather than a particular brand. • Eg: “Butter is good for you” • “Feed the man meat”.

19. Green Marketing • The marketing of “environmentally friendly” products; marketing which takes into account environmental issues such as wastefullness of the earth’s resources, pollution etc.

20. Halo Effect • The transfer of goodwill from one product in a company’s line to another; the attribution, by association, of the qualities of one item to others in the group.

21. Infomercials • A word used to describe a particular type of commercial, for print, TV, radio etc, in which a company promotes its own product while offering valuable information and advice on important public issues.

22. Impulse Buying • Unplanned consumer buying of attractively presented or conveniently located products.

23. Mass Marketing • A marketing philosophy in which the seller views the market as a homogenous whole, and therefore has only one marketing program (the same product, the same price, the same promotion and the same distribution system) for everyone. • It is also referred to as Unsegmented Marketing or Undifferentiated Marketing.

24. Parasitic Advertising • Advertising by one group which has an adverse effect upon another group. • Eg: The advertising of lamb my reduce sales of beef, the advertising of apples may reduce sales of pears.

25. Predatory Pricing • A pricing practice by which a company hopes to inhibit or eliminate competition by charging lower than normal prices for its products in certain geographic regions. • Eg: When new companies enter an industry, well established companies in the same industry may suddenly reduce their prices and even sell goods below cost. • The aim is to drive out the new competitor, by making it unprofitable to be in that industry. • This often leads to a price war. Well established companies can sustain losses for a longer time, than new companies.

26. Product Life Cycle • A concept which draws an analogy between the span of human life and that of a product. • A product life cycle consists of four stages – introduction, growth, maturity and decline.

27. Pyramid Selling • A selling system in which members of a sales organization derive their earnings by selling to newly introduced members of the distribution network (who pay a fee to enter) rather than to end users. • Now illegal in many countries.

28. Referral Selling • Selling to customers whose names have been suggested by previously satisfied customers.

29. Repositioning • Arranging for a product or brand to occupy some other clear and distinctive position in the market than which it presently occupies. • Repositioning may be necessary or desirable if sales expectations are not being met or to allow for the introduction to the market of a new product or brand.

30. Telemarketing • A cost effective method of selling to prospective customers and maintaining contact with existing customers using the telephone and other associated services

31. SWOT Analysis • An examination of the internal environment of a firm (eg: mission, objectives, strategies) to identify particular strengthsand weaknesses and its external environment (eg: economic, social issues) to identify particular opportunities and threats.