frequently asked questions marketing[1]

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FREQUENTLY

ASKEDQUESTIONS

MARKETINg


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Marketing 1

1. What maktng?

There are many denitions of marketing. The better denitions are focused upon customer orientation

and satisfaction of customer needs.

Marketing is the social process by which individuals and groups obtain what they need and want

through creating and exchanging products and value with others.

Marketing is the management process that identies, anticipates and satises customer requirements

protably "Kotler".

The Chartered Institute of Marketing (CIM). The CIM denition (in common with Barwells denition of

the marketing concept) looks not only at identifying customer needs, but also satisfying them (short-term) and anticipating them in the future (long-term retention).

The right product, in the right place, at the right time, at the right price.

2. Dffntat Btwn al and Maktng?

Marketing and selling

Selling Marketing

Emphasis is on the product. Emphasis is on consumerneeds and wants

Management is sales volume

oriented

Management is profit oriented

View businesses as a goods

producing processes

View business as consumer

satisfying processes

Company manufactures theproduct first and then decides

to sell it

Company first determinescustomers needs and wants

and then decides on how todeliver a product to satisfy

these wants

See customer as the last link

in the business

Views customer as the very

purpose in business. 16

3. DeneNeedawantsandDesires

Needsstate of felt deprivation for basic items such as food and clothing and complex needs such

as for belonging. i.e. I am hungry.

Wantsform that a human need takes as shaped by culture and individual personality. i.e. I want

a hamburger, French fries, and a soft drink.

Demandshuman wants backed by buying power. i.e. I have money to buy this meal.


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4. What th maktng mx?

The maktng mx is probably the most famous marketing term. Its elements are thebasic, tactical components of a marketing plan. Also known as the F P, the marketingmixelements are pc, plac,pdct, and pmtn. Read on for more details on themarketing mix. Packaging (Given by Mc carthy).

5. Maktng and C Cmptnc

A core competence is the result of a specic unique set of skills or production techniques thatdeliver value to the customer.

Th tt f c cmptnc.

Provides potential access to a wide variety of markets.

Should make a signicant contribution to the perceived customer benets of the end product.

Should be difcult for competitors to imitate.

6. Val Chan Anal

The value chain is a systematic approach to examining the development of competitive advantage. It

was created by M. E. Porter in his book, Competitive Advantage (1980). The chain consists of a series

of activities that create and build value. They culminate in the total value delivered by an organisation.

PriMAry ACTiViTies

Inbound LogisticsHere goods are received from a companys suppliers. They are stored until they are needed on the

production/assembly line. Goods are moved around the organisation.

Operations.

This is where goods are manufactured or assembled. Individual operations could include room service

in an hotel, packing of books/videos/games by an online retailer, or the nal tune for a new cars

engine.


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Outbound Logistics.

The goods are now nished, and they need to be sent along the supply chain to wholesalers,retailers or the nal consumer.

Marketing and Sales.

In true customer orientated fashion, at this stage the organisation prepares the offering to meetthe needs of targeted customers. This area focuses strongly upon marketing communicationsand the promotions mix.

svc

This includes all areas of service such as installation, after-sales service, complaints handling,training and so on.

suPPorT ACTiViTies

Procurement

This function is responsible for all purchasing of goods, services and materials. The aim is to secure

the lowest possible price for purchases of the highest possible quality. They will be responsible for

outsourcing (components or operations that would normally be done in-house are done by other

organisations), and ePurchasing (using IT and web-based technologies to achieve procurement aims).

Technology Development

Technology is an important source of competitive advantage. Companies need to innovate to reduce

costs and to protect and sustain competitive advantage. This could include production technology,Internet marketing activities, lean manufacturing, Customer Relationship Management (CRM), and

many other technological developments.

Human Resource Management (HRM)

Employees are an expensive and vital resource. An organisation would manage recruitment and s

election, training and development, and rewards and remuneration. The mission and objectives of the

organisation would be driving force behind the HRM strategy.

Firm Infrastructure

This activity includes and is driven by corporate or strategic planning. It includes the ManagementInformation System (MIS), and other mechanisms for planning and control such as the accounting

department.

7. Makt ach and Maktng ach

Are often confused. Marketresearch is simply research into a specic market. It is a very narrow

concept. Marketingresearch is much broader. It not only includes market research, but also areas

such as research into new products, or modes of distribution such as via the Internet. Here are a

couple of denitions.


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8. What Cnm Bhav?

To dene consumer behavior: it is the study of consumers and the processes they use to choose, use

(consume), and dispose of products and services. A more in depth denition will also include how that

process impacts the world. Consumer behavior incorporates ideas from several sciences including

psychology, biology, chemistry and economics.

All marketing decisions are based on assumptions and knowledge of consumer behavior, (Hawkinsand Mothersbaugh, 2007). Researching consumer behavior is a complex process, but understanding

consumer behavior is critical to marketers-they can use it to:

Provide value and customer satisfaction.

Effectively target customers.

Enhance the value of the company.

Improve products and services.

Create a competitive advantage.

Understand how customers view their products versus their competitors products.

Expand the knowledge base in the eld of marketing.

Apply marketing strategies toward a positive affect on society (encourage people to support

charities, promote healthy habits, reduce drug use etc.)

9. What mant b Qalt?

Qalt is a product or services ability to meet the customers need or want. Quality is difcult

to dene, and varies with each consumer.

10. What a th cmpnnt f qalt f pdct and vc?

Pdct

PerformanceThe product does what it is supposed to do.

FeaturesThe product includes all the specications that it says it has or that are required, this

includes safety measures.

ReliabilityThe product performs consistently. DurabilityWhen the product is being used it has to last under the conditions of normal use.

ServiceabilityThe product is easy to maintain or repair either by the consumer or by providing

a warranty which says the company will provide repairs.

AestheticsThis is important to consumers, products have to look good, and this contributes to

a brand equity and identity.

PerceptionEven if the product has good quality, if the customer does not think so, then it wont

sell. The customer has to have positive feelings about the product, the company, the brand name

and the employees.


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svc

ResponsivenessServices are performed in a prompt manner.

ReliabilityThe service is performed right, the rst time, and all subsequent times.

Assurance Knowledgeable and friendly employees are essential as customers will equate

employees behavior with the entire company. If a customer has a bad experience with an employee,

they will be less likely to purchase from the entire companys offerings. Customers expect technical

competence and professionalism from salespeople.

EmpathyProviding individualized attention to customers will make them feel special and keep

them coming back.

TangiblesSome services provide physical evidence that they occurred, for example a restaurant

cooks (service) and provides the food (product).

11. Val and rlatnhp Qalt

Consumers choose goods and services based on the assumption that they will be rewarded with valueand satisfaction. Consumption is the process by which goods and services are used and assigned a

level of value by the consumer.

Quality + Price + Customer Service = Value and Satisfaction.

12. sgmntatn, Dmgaphc and Bhav

Segmentation is the process of breaking down the intended product market into manageable groups;

it can be broken down by:

Product Use.

Buying Situation.

Purchasing Method.

Behavior.

Geographic Location.

Demographics.

Psychographics.

Pdct u

Hw ctm pdct installation, components, accessories, raw material, eaten,

professional service.

Bng statn

Bng tatn rebuy, modied rebuy, new purchase.

Pchang Mthd

Purchasingmethods Internet, long term contract, warranty, nancing, cash on demand.


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Bhav

Needseconomic, functional, psychological, social.

Benetsquality, service, economy, convenience, speed.

AttitudetowardproductEnthusiastic, positive, indifferent, negative, hostile.

UserstatusNonuser, ex user, potential user, rst time user, regular user.

LoyaltystatusNone, medium, strong, absolute.

BrandFamiliarityUnaware, aware, informed, interested, desirous, intending to buy.

Occasion Regular occasion; special occasion, convenience, comparison shopping, unsought

product.

Typeofproblemsolvingneededroutine, limited, extensive.

Informationrequiredlow, medium, high.

Ggaphc Lcatn

Regionofworld,countryNorth America, South America, Africa, Asia, Europe.

Regionswithinthatcountry (For Example USA) Pacic Northwest, South, Midwest, New England.

Sizeofcity population under 5,000 people to 4 million or more.

Urban vs. rural country, city, large city = more resources, more independence; country=more

dependence on neighbors and pooling resources.

Climate cold, hot, rainy, desert, beaches, mountains.

Dmgaphc

Incomeunder $5,000 to $250,000+ a year.

Gendermale, female, neither, both.

AgeInfant, toddler, preschool, tween (age 8 to 12), teen, college age, 20, 30, 40, 50, 60, 70-90.

Familysize 1 person, 2, 3, 4, 5 or more.

Familylifecycleyoung, single, engaged, DINKS (double income no kids), SINKS (single income

no kids), married with kids (babies, toddler, elementary school age, teen, older), recently divorced,

empty nester (children have moved out), same-sex couples, single parents, extended parents

(grandparents raising their grandchildren), retired (either wealthy or Medicare dependent/poor). There

are also Boomerang Kids (adult children have moved back home), Cougar/Silver Fox (Cougar is a

40-60 year old weathly, single, career driven woman seeking a younger man; Silver Fox is a 40-60

year old wealthy, single, career driven man seeking a younger woman).

Job unemployed, housewife, part-time, full-time, student, professional, craftsperson, farmer, retired.

Education grade school or less, some high school, high school graduate, some college, college

graduate, graduate degrees.

Religion Christian, Jewish, agnostic, atheist, Muslim, Islam etc.


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Race White, Black, Asian, Hispanic, Native American, mixed race, etc.

Culture/nationalityAmerican, French, English, African, Russian, Indian etc.

Generation (For Example USA) GI Generation, Silent, Matures, Baby Boomer, Gen X, Gen Y,

Boomlets.

Pchgaphc

Lftl interests, hobbies, activities, interests, opinions, values, media preferences. Everyone

has two lifestyles, the one they are in now, and the one they desire to be in, which is usually better

than the current one. Almost all decisions are inuenced by the buyers current and desiredlifestyle.

Pnalt tat

Sincerity.

Excitement.

Competence.

Sophistication.

Ruggedness.

scal claLower, middle-low, middle, middle-upper, upper, upper-upper, working class, blue

collar.

Tagtng is the second stage of the SEGMENT Target POSITION (STP) process. After the market

has been separated into its segments, the marketer will select a segment or series of segments and

target it/them. Resources and effort will be targeted at the segment.

Positioning is all about perception. As perception differs from person to person, so do the results

of the positioning map e.g what you perceive as quality, value for money, etc, is different to my

perception. However, there will be similarities.

Products or services are mapped together on a ptnng map

13. Fv Lvl f a Pdct.


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14. Th Pdct Lf Ccl (PLC)

Th Pdct Lf Ccl (PLC) is based upon the biological life cycle. For example, a seed is planted

(introduction); it begins to sprout (growth); it shoots out leaves and puts down roots as it becomes an

adult (maturity); after a long period as an adult the plant begins to shrink and die out (decline).

In theory its the same for a product. After a period of development it is introduced or launched into

the market; it gains more and more customers as it grows; eventually the market stabilises and the

product becomes mature; then after a period of time the product is overtaken by development and the

introduction of superior competitors, it goes into decline and is eventually withdrawn.

statg f th dffng tag f th Pdct Lf Ccl.

intdctn

The need for immediate prot is not a pressure. The product is promoted to create awareness. Ifthe product has no or few competitors, a skimming price strategy is employed. Limited numbers of

product are available in few channels of distribution.

Gwth.

Competitors are attracted into the market with very similar offerings. Products become more protable

and companies form alliances, joint ventures and take each other over. Advertising spend is high and

focuses upon building brand. Market share tends to stabilise.

Matt.

Those products that survive the earlier stages tend to spend longest in this phase. Sales grow at adecreasing rate and then stabilise. Producers attempt to differentiate products and brands are key to

this. Price wars and intense competition occur. At this point the market reaches saturation. Producers

begin to leave the market due to poor margins. Promotion becomes more widespread and use a

greater variety of media.

Dcln.

At this point there is a downturn in the market. For example more innovative products are introduced

or consumer tastes have changed. There is intense price-cutting and many more products are

withdrawn from the market. Prots can be improved by reducing marketing spend and cost cutting.


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15. Pblm wth Pdct Lf Ccl

In reality very few products follow such a prescriptive cycle. The length of each stage variesenormously. The decisions of marketers can change the stage, for example from maturity todecline by price-cutting. Not all products go through each stage. Some go from introductionto decline. It is not easy to tell which stage the product is in. Remember that PLC is like allother tools.

16. Pcng & Pcng statg

There are many ways to pc a product. Lets have a look at some of them and try to understand the

best policy/strategy in various situations.

Pmm Pcng

Use a high price where there is a uniqueness about the product or service. This approach is used

where a a substantial competitive advantage exists. Such high prices are charge for luxuries such as

Cunard Cruises, Savoy Hotel rooms, and Concorde ights.

Pntatn Pcng

The price charged for products and services is set articially low in order to gain market share. Once

this is achieved, the price is increased. This approach was used by France Telecom and Sky TV.

ecnm Pcng

This is a no frills low price. The cost of marketing and manufacture are kept at a minimum. Supermarkets

often have economy brands for soups, spaghetti, etc.

Pc skmmng

Charge a high price because you have a substantial competitive advantage. However, the advantageis not sustainable. The high price tends to attract new competitors into the market, and the price

inevitably falls due to increased supply. Manufacturers of digital watches used a skimming approach

in the 1970s. Once other manufacturers were tempted into the market and the watches were produced

at a lower unit cost, other marketing strategies and pricing approaches are implemented.

17. DenePlaceinMarketingMix

Place is also known as channel, distribution, or intermediary. It is the mechanism throughwhich goods and/or services are moved from the manufacturer/ service provider to the useror consumer.

18. Th a x bac channl dcn:

Do we use direct or indirect channels? (e.g. direct to a consumer, indirect via a wholesaler).

Single or multiple channels.

Cumulative length of the multiple channels.

Types of intermediary (see later).

Number of intermediaries at each level (e.g. how many retailers in Southern Spain).

Which companies as intermediaries to avoid intrachannel conict (i.e. inghting between local

distributors).


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19. SelectionConsiderationhowdowedecideuponadistributor?

Marketsegmentthe distributor must be familiar with your target consumer and segment.

Chang dng th pdct lf ccl different channels can be exploited at different points

in the PLC e.g. Foldaway scooters are now available everywhere. Once they were sold via a few

specic stores.

Producerdistributor tIs there a match between their polices, strategies, image, and yours?

Look for synergy.

Qualicationassessment establish the experience and track record of your intermediary.

How much training and support will your distributor require?

20. Tp f Channl intmda

There are many types of intermediaries such as wholesalers, agents, retailers, the Internet,overseas distributors, direct marketing (from manufacturer to user without an intermediary),

and many others. The main modes of distribution will be looked at in more detail.

21. ChannelIntermediariesWholesalers

They break down bulk into smaller packages for resale by a retailer.

They buy from producers and resell to retailers. They take ownership or title to goods whereas

agents do not (see below).

They provide storage facilities. For example, cheese manufacturers seldom wait for their product

to mature. They sell on to a wholesaler that will store it and eventually resell to a retailer.

Wholesalers offer reduce the physical contact cost between the producer and consumer e.g.

customer service costs, or sales force costs.

A wholesaler will often take on the some of the marketing responsibilities. Many produce their own

brochures and use their own telesales operations.

i.ChannelIntermediariesAgents

Agents are mainly used in international markets.

An agent will typically secure an order for a producer and will take a commission. They do not tend

to take title to the goods. This means that capital is not tied up in goods. However, a stockist agent

will hold consignment stock (i.e. will store the stock, but the title will remain with the producer.This approach is used where goods need to get into a market soon after the order is placed e.g.

foodstuffs).

Agents can be very expensive to train. They are difcult to keep control of due to the physical

distances involved. They are difcult to motivate.

ii.ChannelIntermediariesRetailers

Retailers will have a much stronger personal relationship with the consumer.

The retailer will hold several other brands and products. A consumer will expect to be exposed to

many products.


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Retailers will often offer credit to the customer e.g. electrical wholesalers, or travel agents.

Products and services are promoted and merchandised by the retailer.

The retailer will give the nal selling price to the product.

Retailers often have a strong brand themselves e.g. Ross and Wall-Mart in the USA, and Alisuper,

Modelo, and Jumbo in Portugal.

iii.ChannelIntermediariesInternet

The Internet has a geographically disperse market.

The main benet of the Internet is that niche products reach a wider audience e.g. Scottish Salmon

direct from an Inverness shery.

There are low barriers low barriers to entry as set up costs are low.

Use e-commerce technology (for payment, shopping software, etc)

There is a paradigm shift in commerce and consumption which benets distribution via the Internet

22. sWoT Anal

stngth, Wakn, opptnt and That (sWoT)

SWOT analysis is a tool for auditing an organization and its environment. It is the rst stage of planning

and helps marketers to focus on key issues. SWOT stands for strengths, weaknesses, opportunities,

and threats. Strengths and weaknesses are internal factors. Opportunities and threats are external

factors.

A tngth cld b:

Your specialist marketing expertise.

A new, innovative product or service.

Location of your business.

Quality processes and procedures.

Any other aspect of your business that adds value to your product or service.

smpl l f ccfl sWoT anal.

Be realistic about the strengths and weaknesses of your organization when conducting sWoTanalysis.

SWOT analysis should distinguish between where your organization is today, and where it could

be in the future.

SWOT should always be specic. Avoid grey areas.

Always apply SWOT in relation to your competition i.e. better than or worse than your competition.

Keep your SWOT short and simple. Avoid complexity and over analysis

SWOT is subjective.


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Once key issues have been identied with your SWOT analysis, they feed into marketing objectives.

sWoT can be used in conjunction with other tools for audit and analysis, such as PEST analysis and

Porters Five-Forces analysis. So SWOT is a very popular tool with marketing students because it is

quick and easy to learn. During the SWOT exercise, list factors in the relevant boxes. Its that simple.

23. What PesT Anal?

It is very important that an organization considers its environment before beginning the marketing

process. In fact, environmental analysis should be continuous and feed all aspects of planning.

The organizations marketing environment is made up of:

1. The internal environment e.g. staff (or internal customers), ofce technology, wages and nance,

etc.

2. The micro-envronment e.g. our external customers, agents and distributors, suppliers, our

competitors, etc.

3. The macro-environment e.g. Political (and legal) forces, Economic forces, Sociocultural forces,

and Technological forces. These are known as PesT factors.

Pltcal Fact

The political arena has a huge inuence upon the regulation of businesses, and the spending power

of consumers and other businesses. You must consider issues such as:

1. How stable is the political environment?

2. Will government policy inuence laws that regulate or tax your business?

3. What is the governments position on marketing ethics?

4. What is the governments policy on the economy?

5. Does the government have a view on culture and religion?

6. Is the government involved in trading agreements such as EU, NAFTA, ASEAN, or others?

ecnmc Fact.

Marketers need to consider the state of a trading economy in the short and long-terms. This is

especially true when planning for international marketing. You need to look at:

1. Interest rates.

2. The level of ination Employment level per capita.

3. Long-term prospects for the economy Gross Domestic Product (GDP) per capita, and so on.

sccltal Fact.

The social and cultural inuences on business vary from country to country. It is very important that

such factors are considered. Factors include:

1. What is the dominant religion?

2. What are attitudes to foreign products and services?

3. Does language impact upon the diffusion of products onto markets?


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4. How much time do consumers have for leisure?

5. What are the roles of men and women within society?

6. How long are the population living? Are the older generations wealthy?

7. Do the population have a strong/weak opinion on green issues?

Tchnlgcal Fact

Technology is vital for competitive advantage, and is a major driver of globalization. Consider the

following points:

1. Does technology allow for products and services to be made more cheaply and to a better standard

of quality?

2. Do the technologies offer consumers and businesses more innovative products and services such

as Internet banking, new generation mobile telephones, etc?

3. How is distribution changed by new technologies e.g. books via the Internet, ight tickets, auctions,

etc?

4. Does technology offer companies a new way to communicate with consumers e.g. banners,

Customer Relationship Management (CRM), etc?

24. AnalyzingtheenvironmentFiveForcesAnalysis

Fv Fc Anal helps the marketer to contrast a competitive environment. It hassimilarities with other tools for environmental audit, such as PEST analysis, but tends tofocus on the single, stand alone, business or SBU (Strategic Business Unit) rather than asingle product or range of products. For example, Dell would analyse the market for Business

Computers i.e. one of its SBUs.

Five forces analsysis looks at ve key areas namely the threat of entry, the power of buyers,the power of suppliers, the threat of substitutes, and competitive rivalry.

Th that f nt.

Economies of scale e.g. the benets associated with bulk purchasing.

The high or low cost of entry e.g. how much will it cost for the latest technology?

Ease of access to distribution channels e.g. Do our competitors have the distribution channels

sewn up? Cost advantages not related to the size of the company e.g. personal contacts or knowledge that

larger companies do not own or learning curve effects.

Will competitors retaliate?

Government action e.g. will new laws be introduced that will weaken our competitive position?

How important is differentiation? e.g. The Champagne brand cannot be copied. This desensitises

the inuence of the environment.

This is high where there a few, large players in a market e.g. the large grocery chains.


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Maktng14

If there are a large number of undifferentiated, small suppliers e.g. small farming businesses

supplying the large grocery chains.

The cost of switching between suppliers is low e.g. from one eet supplier of trucks to another.

Th pw f ppl.

The power of suppliers tends to be a reversal of the power of buyers.

Where the switching costs are high e.g. Switching from one software supplier to another.

Power is high where the brand is powerful e.g. Cadillac, Pizza Hut, Microsoft.

There is a possibility of the supplier integrating forward e.g. Brewers buying bars.

Customers are fragmented (not in clusters) so that they have little bargaining power e.g. Gas/

Petrol stations in remote places.

Th that f bttt

Where there is product-for-product substitution e.g. email for fax Where there is substitution ofneed e.g. better toothpaste reduces the need for dentists.

Where there is generic substitution (competing for the currency in your pocket) e.g. Video suppliers

compete with travel companies.

We could always do without e.g. cigarettes.

Cmpttv rval

This is most likely to be high where entry is likely; there is the threat of substitute products, and

suppliers and buyers in the market attempt to control. This is why it is always seen in the center of

the diagram.


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Maktng 15

intgatd Maktng Cmmncatn

25. What a maktng cmmncatn?

Marketing communications is a subset of the overall subject area known as marketing. Marketing has

a marketing mix that is made of price, place, promotion, product (know as the four Ps), that includes

people, processes and physical evidence, when marketing services (known as the seven Ps).

26. Wh a maktng cmmncatn ntgatd?

Integrated means combine or amalgamate, or put simply the jigsaw pieces that together make a

complete picture. This is so that a single message is conveyed by all marketing communications.

Different messages confuse your customers and damage brands. So if a TV advert carries a particular

logo, images and message, then all newspaper adverts and point-of-sale materials should carry

the same logo, images or message, or one that ts the same theme. Coca-Cola uses its familiar

red and white logos and retains themes of togetherness and enjoyment throughout its marketing

communications.

27. Maktng cmmncatn ha a mx.

Elements of the mix are blended in different quantities in a campaign. The marketing communications

mix includes many different elements, and the following list is by no means conclusive. It is recognised

that there is some cross over between individual elements (e.g. Is donating computers to schools,

by asking shoppers to collect vouchers, public relations or sales promotion?) Here are the key of the

marketing communications mix.

Personal Selling.

Sales Promotion.

Public Relations (and publicity).

Direct Marketing.

28. Band and Bandng

Bandng is a strategy that is used by marketers. Pickton and Broderick (2001) describe branding as

Strategy to differentiate products and companies, and to build economic value for both the consumer

and the brand owner.

Band occupies space in the perception of the consumer, and is what results from the totality of what

the consumer takes into consideration before making a purchase decision (Pickton and Broderick

2001).

So brandingis a strategy, and brandis what has meaning to the consumer.


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Maktng16

There are some other terms used in branding. Band eqt is the addition of the brands attributes

including reputation, symbols, associations and names. Then the nancial expression of the elements

of brand equity is called Band Val.

There are a number ofntptatnof the term brand (De Chernatony 2003). They are summarized

as follows:

A brand is simply a logo e.g. McDonalds Golden Arches.

A brand is a legal instrument, existing in a similar way to a patent or copyright.

A brand is a companye.g. Coca-Cola.

A brand is shorthandnot as straightforward. Here a brand that is perceived as having benets

in the mind of the consumer is recognised and acts as a shortcut to circumvent large chunks of

information. So when searching for a product or service in less familiar surroundings you will conduct

an information search. A recognised brand will help you reach a decision more conveniently.

A brand is a risk reducer. The brand reassures you when in unfamiliar territory.

A brand is positioning. It is situated in relation to other brands in the mind of the consumer as

better, worse, quicker, slower, etc.

A brand is apersonality, beyond function e.g. Apples iPod versus just any MP3 player.

A brand is a cluster of values e.g. Google is reliable, ethical, invaluable, innovative and so on.

A brand is a vision. Here managers aspire to see a brand with a cluster of values. In this context

vision is similar to goal or mission.

A brand is added value, where the consumer sees value in a brand over and above its competition

e.g. Audi over Volkswagen, and Volkswagen over Skodadespite similarities.

A brand is an identitythat includes all sorts of components; depending on the brand e.g. Body

Shop International encapsulates ethics, environmentalism and political beliefs.

A brand is an image where the consumer perceives a brand as representing a particular reality e.g.

Stella Artois Reassuring Expensive.

A brand is a relationship where the consumer reects upon him or herself through the experience

of consuming a product or service.

Marcoms tool that a marketer can employ for branding decision-making is theFour Banding Alternatives

(Tauber 1981). Four Branding Alternatives is a strategic marketing communications technique.

It is a fun and creative approach that can add value to any class that likes to discuss brands and how

they could be innovatively developed. It is used when an organization considers adding a product to

its portfolio and its associated brand name. The two variables for this matrix are Pdct Catg

(Existing or New) and Band Catg (Existing or New).

NewProduct a new product is developed with a series of new brand ideas and meanings to the

consumer.

Flank Band a new brand is introduced into a category where the organization already has

established products.

Ln extnn a current brand name is introduced into a category where the organizationalready has established products.


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Fanch extnn a familiar brand is taken to a product category where it is unknown.

Heres an example. Firstly lets recall that Four Branding Alternatives is a strategic tool, so you need

to base it upon a very large organisation which is likely to own a number of brands.

Examples would include car manufacturers, large IT companies, and conglomerates. You get the

idea.

An example for the Japanese company, Sony Inc is as follows:

New ProductSony enters the market for music downloads under a new sub-branding idea and

concept.

Flanker BrandSony introduces the Sony Vaio laptops (as it indeed has).

Line ExtensionSony enter the market for digital HD TVs (as it has).

Franchise ExtensionSony enters the market for innovative environmentally friendly small cars

that run on solar power.

29. Lalt Ladd

The lalt ladd is a tool for marketing communicators. The idea is that consumers can be

moved along a continuum of loyalty using a number of integrated marketing communications

techniques (it is also referred to as a bandng ladd).

Essentially, consumers become loyal to a brand which has meaning to them in relation to a product,

service, solution or experience.

30. Advtng

Advertising is an important element of the marketing communications mix. Put simply, advertising

directs a message at large numbers of people with a single communication. It is a mass medium.

31. BenetsofAdvertising

Advertising has a number of benets for the advertiser. The advertiser has control over the message.


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The advert and its message, to an extent, would be designed to the specications of the advertiser.

So the advertiser can focus its message at a huge number of potential consumers in a single hit,

at a relatively low cost per head. Advertising is quick relative to other elements of the marketing

communications mix (for example personal selling, where an entire sales force would need to be

briefedor even recruited). Therefore an advertiser has the opportunity to communicate with all (or

many of) its target audience simultaneously.

29. Advtng Mda

Outdoor (Posters or

transport)

New MediaMobile

devices

New Media Internetwebsites and

search engines

Newspapers (Local and

National)Television Magazines

Radio Cinema Others...

32. Plannng f advtng

Advertising agencies and their clients plan for advertising. Any plan should address the following

stages:

Who is the potential TARGETAUDIENCE of the advert?

WHAT do I wish to communicate to this target audience?

Why is this message so IMPORTANT to them?

What is the BesT MeDiuM for this message to take (see some of the possible media above)?

What would be the most appropriate TIMING?

What resourCes will the advertising campaign need?

How do we CONTROL our advertising and monitor success?

There are two key categories of advertising, namely above-the-line and below-the-line.The

denitions owe a lot to the historical development of advertising agencies and how they charge for

their services. In a nutshell, above-the-line is any work done involving media where a commission is

taken by an advertising agency, and below-the-line is work done for a client where a standard charge

replaces commission. So TV advertising is above-the-line since an agency would book commercial

time on behalf of a client, but placing an advert in a series of local newspapers is below-the-line,because newspapers tend to apply their own costing approach where no commission is taken by

the agency i.e. instead the agency charges the client a transparentfee. There are many facets and

elements to advertisingtoo many to be covered in this short lesson. Try some of the other lessons to

build your knowledge

33. Pblc latn a pat f th maktng cmmncatn mx

Pblc latn is a single, broad concept. It is broad since it contains so many elements, many

of which will be outlined in this lesson. Public Relations (PR) are any purposeful communications

between an organisation and its publics that aim to generate goodwill.


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34. Dcb m f th appach that a ftn cndd nd th Pr bann

intvw and pht-call.

It is important that company executives are available to generate goodwill for their organisation.Many undertake training in how to deal with the media, and how to behave in front of a camera.There are many key industrial gures that proactively deal with the media in a positive way

for example Bill Gates (Microsoft) or Richard Branson (Virgin). Interviews with the businessor mass media often allow a company to put its own perspective on matters that could bemisleading if simply left to dwell untended the public domain.

spch, pntatn and pch wtng

Key gures from within an organisation will write speeches to be delivered at corporate events, public

awards and industry gatherings. PR company ofcials in liaison with company managers often write

speeches and design corporate presentations. They are part of the planned and coherent strategy

to build goodwill with publics. Presentations can be designed and pre-prepared by PR companies,

ultimately to be delivered by company executives.

Corporateliteraturee.g.nancialreports

Corporate literature includes nancial reports, in-house magazines, brochures, catalogues, price lists

and any other piece of corporate derived literature. They communicate with a variety of publics. For

example, nancial reports will be of great interest to investors and the stock market, since they give

all sorts of indicators of the health of a business. A company Chief Executive Ofcer CEO will often

write the forward to an annual nancial report where he or she has the opportunity to put a business

case to the reader. This is all part of Public Relations.

35. What an advtng agnc?

An advertising agency handles part or all marketing communications activities on behalf of a clientorganization. The agencies themselves tend to vary in size from small, perhaps a handful of people,

to vastwhere many thousands of employees make up the company. A commission is generally taken

by the agency which tends to be taken from the media purchases of the client organisation.

36. Clnt latngp agnc?

This is done rather like a theatrical agent would take a percentage of the income of an actor for

whom employment had been found. The agency may also take payment from the media owners (i.e.

sometimes take a discount and do not pass it on to the client). More transparent means of payment

are becoming more popular, with some agencies being paid-by-results.

There are many types of agency, but it is generally accepted that the main ones are include full-service

agency, a la carte agency, or specialist agency. A full-service agency will take on the whole project or

campaign. An a la carte agency will offer some aspects of a campaign such as media buying, rather

like buying items from a menu. A specialist agency tends to be small and more focused on a specic

aspect of marketing communications and/or a specic market such as Internet Marketing.

A Fll-svc Agnc wll ff:

Account management.

Creative.

Media.

Trafc and production.


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Account planning.

Account management.

Account managers work for an agency with the client (an agencys customers are called clients).

Very often they will spend a lot of time with the client working as part of their marketing team. This

is one way in which an agency works closely with its client and why the chemistry between a client

and its agency needs to be right. The account manager makes sure that the correct information ispassed from the client to the other members of the agency. He or she is a co-ordinator and time

manager. The account planner will work on a brief that is fed back to the agency team.

Catv Tam

The rst internal agency team members to see the brief tend to be the creatives and the media

planners. The brief contains a proposition that the client wishes to communicate to the target

audience. The creative team will transform the proposition into something exciting and attractive to

the target audience. The creative team decide upon the creative concept. This will be a motivational

idea. The words used to express the creative concept are called copy. The images, pictures and

diagrams are created i.e. the design or layout. This is done by designers and copywriters. Beware

some creatives! Creatives tend to be artistic and innovative. Hence their advice should be highly

regarded and any criticism should be constructive.

TrafcandProductionTeam

The trafc and media team are in charge of the production of the physical and artistic output, i.e. the

marketing communication. In the case of a TV advert, they would commission scripts, recruit a ctors

(mainly via agents), lm crews and supporting activities (such as costumes and catering). All ads are

different and so the specics will vary. In the case of print advertising, the trafc and production team

would commission and sign-off all printed advertising material such as direct marketing materials,

magazine ads or posters.

Accnt Plannng Tam

The account planning team work on the customers perspective, and take an outward look at the

world. They support the creative teams by supplying data and opinion on what I actually occurring

in the marketing in which advertising is to be placed. They tend to use secondary data to support

decisions, and would rarely commission original research. However, with material supplied my

organisations such as Mori, Datamonitor, ACORN, and otherthe account planning team can build an

image of segments to help the creatives.

Mda Tam

The media team will organise the timing and scheduling of the marketing communications campaign.They will look at the range of media to be exploited, and then look at the best slots in which to run

advertising. They will help a client to decide upon the duration of and individual slot, and how many of

them to run. Here the expense and return to the client are key factors that inuence decision-making.

The two main skills of the media team are media planning and media buying. Today there is a wealth

of data on which media buying can be based. There is software for planning and simulation.

37. What Dct Maktng?

Direct marketing is a channel free approach to distribution and/or marketing communications.So a company may have a strategy of dealing with its customers directly, for examplebanks (such as CityBank) or computer manufacturers (such as Dell). There are no channel


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intermediaries i.e. distributors, retailers or wholesalers. Thereforedirect in the sense thatthe deal is done directly between the manufacturer and the customer.

38. What a th dffnt tp f Dct Maktng?

There are a number of direct marketing media other than direct mail. These include (and areby no means limited to):

Inserts in newspapers and magazines.

Customer care lines.

Catalogues.

Coupons.

Door drops.

TV and radio adverts with free phone numbers or per-minute-charging.

...and nallyand most importantlyThe Internet and New Media.

39. sal Pmtn

What al pmtn?

Sales promotion is any initiative undertaken by an organisation to promote an increase in sales,

usage or trial of a product or service (i.e. initiatives that are not covered by the other elements of the

marketing communications or promotions mix). Sales promotions are varied.

40. What a th dffnt tp f sal Pmtn?(a) B-on-Gt-on-F (BoGoF)which is an example of a self-liquidating promotion. For

example if a loaf of bread is priced at $1, and cost 10 cents to manufacture, if you sell two for $1,

you are still in protespecially if there is a corresponding increase in sales. This is known as a

PREMIUM sales promotion tactic.

(b) Ctm rlatnhp Managmnt (CrM) incentives such as bonus points or money off

coupons. There are many examples of CRM, from banks to supermarkets.

(c) NewmediaWebsites and mobile phones that support a sales promotion. For example, in the

United Kingdom, Nestle printed individual codes on KIT-KAT packaging, whereby a consumer

would enter the code into a dynamic website to see if they had won a prize. Consumers could alsotext codes via their mobile phones to the same effect.

(d) Mchandng additions such as dump bins, point-of-sale materials and product demonstrations.

(e) F gft e.g. Subway gave away a card with six spaces for stickers with each sandwich purchase.

Once the card was full the consumer was given a free sandwich.

(f) Dcntd pc e.g. Budget airline such as EasyJet and Ryanair, e-mail their customers with

the latest low-price deals once new ights are released, or additional destinations are announced.

(g) Jnt pmtn between brands owned by a company, or with another companys brands. For

example fast food restaurants often run sales promotions where toys, relating to a specic movierelease, are given away with promoted meals.


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(h) F ampl (aka. sampling) e.g. tasting of food and drink at sampling points in supermarkets.

For example Red Bull (a caffeinated zzy drink) was given away to potential consumers at

supermarkets, in high streets and at petrol stations (by a promotions team).

(i) Vch and cpn, often seen in newspapers and magazines, on packs.

(j) Cmpttn and pz daw, in newspapers, magazines, on the TV and radio, on The Internet,

and on packs.

(k) Ca-latd and fa-tad products that raise money for charities, and the less well off farmers

and producers, are becoming more popular.

(i) Financedealsfor example, 0% nance over 3 years on selected vehicles.

Many of the examples above are focused upon consumers. Dont forget that promotions can be

aimed at wholesalers and distributors as well. These are known as Tad sal Pmtn.

SERVICEMARKETING

41 What vc maktng?

A vc is the action of doing something for someone or something. It is largely intangible (i.e. not

material). A product is tangible (i.e. material) since you can touch it and own it. A service tends to be

an experience that is consumed at the point where it is purchased, and cannot be owned since is

quickly perishes. A person could go to a caf one day and have excellent service, and then return the

next day and have a poor experience.

42. Chaacttc f svc a:

inpaablfrom the point where it is consumed, and from the provider of the service. For example,you cannot take a live theatre performance home to consume it (a DVD of the same performance

would be a product, not a service).

intangbland cannot have a real, physical presence as does a product. For example, motor

insurance may have a certicate, but the nancial service itself cannot be touched i.e. it is intangible.

Phablin that once it has occurred it cannot be repeated in exactly the same way. For example,

once a 100 metres Olympic nal has been run, there will be not other for 4 more years, and even then

it will be staged in a different place with many different nalists.

Vaablt- since the human involvement of service provision means that no two services will becompletely identical. For example, returning to the same garage time and time again for a service on

your car might see different levels of customer satisfaction, or speediness of work.

rght f wnhpis not taken to the service, since you merely experience it. For example, an

engineer may service your air-conditioning, but you do not own the service, the engineer or his

equipment. You cannot sell it on once it has been consumed, and do not take ownership of it.

Western economies have seen deterioration in their traditional manufacturing industries, and a growth

in their service economies.

43. Ppl a pat f th maktng mxPeople are the most important element of any service or experience. Services tend to beproduced and consumed at the same moment, and aspects of the customer experience are


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altered to meet the individual needs of the person consuming it. Most of us can think of asituation where the personal service offered by individuals has made or tainted a tour, vacationor restaurant meal. Remember, people buy from people that they like, so the attitude, skillsand appearance of all staff need to be rst class. Here are some ways in which people addvalue to an experience, as part of the marketing mixtraining, personal selling and customerservice.

44. Pc a pat f th maktng mx

Pc is another element of the extended marketing mix, or 7Ps.There are a number ofperceptions of the concept of process within the business and marketing literature. Some seeprocesses as a means to achieve an outcome, for exampleto achieve a 30% market sharea company implements a marketing planning process.

45. Phcal vdnc a pat f th maktng mx

Phcal vdnc is the material part of a service. Strictly speaking there are no physical attributes

to a service, so a consumer tends to rely on material cues.

46. Ctm rlatn shp Managmnt

Th Ctm Lf Ccl (CLC) and CrM

The Customer Life Cycle (CLC) has obvious similarities with the Product Life Cycle (PLC). However,

CLC focuses upon the creation of and delivery of lifetime value to the customer i.e. looks at the

products or services that customers NEED throughout their lives.

It is marketing orientated rather than product orientated, and embodies the marketing concept.

Essentially, CLC is a summary of the key stages in a customers relationship with an organisation.

The problem here is that every organisations product offering is different, which makes it impossible

to draw out a single Life Cycle that is the same for every organisation.

Lets consider an example from the Banking sector. HSBC has a number of products that it aims at

its customers throughout their lifetime relationship with the company. Here we apply a CLC. You can

start young when you want to save money. 11-15 year olds are targeted with the Livecash Account,

and 16-17 year olds with the Right Track Account. Then when (or if) you begin College or University

there are Student Loans, and when you qualify there are Recent Graduate Accounts.

When you begin work there are many types of current and savings account, and you may wish to buy

property, and so take out a mortgage. You could take out a car loan, to buy a vehicle to get you to

work. It would also be advisable to take out a pension. As you progress through your career you beginyour own family, and save for your own childrens education. You embark upon a number of savings

plans and schemes, and ultimately HSBC offer you pension planning (you may want to insure yourself

for funeral expensesalthough HSBC may not offer this!).

This is how an organization such as HSBC, which is marketing orientated, can recruit and retain

customers, and then extend additional products and services to themthroughout the individuals life.

This is an example of a Customer Life Cycle (CLC).

Another important point is that a lifetime CLC is made up many shorter CLCs. So, for example,

Volkswagen Cars retains a customer for many years and one can predict the products that meet a

customers needs throughout his or her family lifetime. However the purchase of each car, will in itselfbe a CLC with many Customer Touch Points. The consumer may need a bigger vehicle as his or her

family expandsso they visit VWs website and register.


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The customer reviews models and books a test-drive with her or his local dealer. He or she decides

to buy the car and arranges nance. The car is then delivered from the factory, and returns every

year for its annual service. Then after three years, the customer decides to trade in his or her car,

and the cycle begins again. The longer-term life cycle is simply the shorter-term life cycles viewed

consecutively.

47. Bn statg and CrM

We now consider the Business Strategy Perspective on CRM. Here, we propose a model, which is a

hybrid, and typical of many of the models and diagrams of CRM that you will nd on The Internet and

in popular books on the topic of eMarketing/eCommerce. The model has three key phases and three

contextual factors:

Th k pha:

1. Customer Acquisition.

2. Customer Retention.

3. Customer Extension.

Th cntxtal fact:

4. Marketing Orientation.

5. Value Creation.

6. Innovative IT.

1. Ctm AcqtnThis is the process of attracting our customer for the rst their rst

purchase. We have acquired our customer.

GwthThrough market orientation, innovative IT and value creation we aim to increase the

number of customers that purchase from us for the rst time.

2. Ctm rtntnOur customer returns to us and buys for a second time. We keep them as

a customer. This is most likely to be the purchase of a similar product or service, or the next level

of product or service.

GrowthThrough market orientation, innovative IT and value creation we aim to increase the

number of customers that purchase from us regularly.

3. Ctm extnnOur customers are regularly returning to purchase from us. We introduce

products and services to our loyal customers that may not wholly relate to their original purchase.These are additional, supplementary purchases. Of course once our loyal customers have

purchased them, our goal is to retain them as customers for the extended products or services.

GwthThrough market orientation, innovative IT and value creation we aim to increase the

number of customers that purchase additional or supplementary products and services.

4. Marketing Orientationmeans that the wholes organisation is focused upon the needs of

customers. Customer needs are addressed by the Three Levels of a Product whereby the

organisations not only supplies the actual, tangible product, but also the core product and its

benet, and also the augmented product such as a warranty and customer service. Marketing

orientation will focus upon the needs of consumers for all three levels of a product. (N.B. marketorientation and marketing orientation are not the same).


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5. Val Catncentres on the generation of shareholder value based upon the satisfaction of

customer needs (as with marketing orientation) and the delivery of a sustainable competitive

advantage.

6. innvatv iTis exactly thatInformation Technology must be up-to-date. It should be efcient,

speedy and focus upon the needs of customers. Whilst IT and/or software are not the entire story

for CRM, it is vital to its success. CRM software collects data on consumers and their transactions.

Huge databases store data on individuals and groups of individuals. In some ways, CRM meansthat an organisation is dealing with a segment of one person, since every consumer displays

different purchasing habits and preferences. Organisations will track individuals, and try to market

products and services to them based upon similar buyer behaviour seen in other individuals (e.g.

When Amazon tells you that customers that viewed/bought the same product as you, also bought

another product).

CRM is a term that is often referred to in marketing. However, there is no complete agreement

upon a single denition. This is because CRM can be considered from a number of perspectives.

In summary, the three perspectives are:

48. CrM and infmatn Tchnlg

As we have discussed, CRM is more than just software. For the purposes of this introduction

Information Technology (IT) and CRM have three key elements, namely Customer Touch Points,

Applications, and Data Stores. This section is based loosely upon Raisch (2001) The eMarketplace.

Custm Tch Pnt are vital since your business has a marketing orientation and focuses upon

the customer and his or her current and future needs. This is the interface between your organisation

and its customers. For example you buy a new car from a dealership, and you enter a showroom.

The dealership is a contact point. You meet with a salesperson whom demonstrates the car. The

salesperson is a contact point. You go home and look at the car manufacturers website, and thensend the company an e-mail. Both are contact points. Other contact points include 3G telephone,

video conferencing, Interactive TV, telephone, and letters.

Applcatn are essentially the software and programmes that support the process. Incidentally,

this is what some would call CRMbut we know better. Applications serve Marketing (e.g. data mining

software* and permission marketing**), Sales (e.g. monitoring Customer Touch Points), and Service

(e.g. customer care).

Data st contain data on every aspect of the customer, and the Customer Life Cycle (CLC). For

example, an organisation keeps data on the products you buy, when you buy them, and where they

are sent. Data is also kept on the web pages that you visit and the products that you consider, but then

do not buy. Leads are stored here. Data on the life time value of individual customers is stored here,

as well as details of how and when the customer was recruited, howand for how longindividuals

have been retained, and details of any products that have been extended to individuals are also

stored. The data is analysed using Applications.

49. Pnal sllng

Personal selling occurs where an individual salesperson sells a product, service or solution to a client.

Salespeople match the benets of their offering to the specic needs of a client. Today, personal

selling involves the development of longstanding client relationships.

In comparison to other marketing communications tools such as advertising, personal selling tends to:

Use fewer resources, pricing is often negotiated.


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Products tend to be fairly complex (e.g. nancial services or new cars).

There is some contact between buyer and seller after the sale so that an ongoing relationship is

built.

Client/prospects need specic information.

The purchase tends to involve large sums of money.

50. Pnal llng nvlv a llng pc

Is summarised in the following Five Stage Personal Selling Process. The ve stages are:

1. Prospecting.

2. Making rst contact.

3. The sales call.

4. Objection handling.

5. Closing the sale.


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sht Qtn

1. Abv th ln:

Above the Line is the term commonly used for advertising for which a payment is made and for

which commission is paid to the advertising agency. Methods of above the line advertising include

television and radio, magazines, newspapers and Internet.

2. Ad hc makt ach:

Ad-hoc research focuses on specic marketing problems. It involves the collection of data at one point

in time from one sample of respondents.

3. Addd val:

Added value refers to the increase in worth of a product or service as a result of a particular activity. In

the context of marketing, the added value is provided by features and benets over and above those

representing the core product.

4. Advtng:

Advertising is any paid form of non-personal presentation and promotion of ideas, goods and services

through mass media such as newspapers, magazines, television or radio by an identied sponsor.

5. Advtng bdgt

The total amount of money that a marketer allocates for advertising over a period of time

6. Aft-al vc

The services received after the original goods or services have been paid for. Often this service is

provided as part of a warranty or guarantee scheme.

7. Agnt

Part of the distribution channel. An agent is effectively a wholesaler who represents buyers and sellers

on a relatively permanent basis, performs only a few functions and does not take title to goods

8. Ambh maktng

A deliberate attempt by a business or brand to associate itself with an event (often a sporting event)in order to gain some of the benets associated with being an ofcial sponsor without incurring the

costs of sponsorship. For example by advertising during television coverage of the event.


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9. Anff matx

A model used in strategic marketing planning. The Ansoff Product/Market matrix model links marketing

strategy with the general strategic direction of a business. It maps four potential product-market

strategies - e.g. market penetration, product development, market development and diversication

- on a matrix showing new versus existing products along one axis and new versus existing markets

along the other.

10. Agmntd band

The additional customer services and benets (added value) that are built around the core product

or service offering.

11. Avalabl makt

The total groups of customers who have an interest in an interest in a product or service, have access

to it, and have the ability to buy it.

Awan

Advertising or other promotional activity (e.g. public relations) whose primary purpose is to increases

general knowledge of the company, and to make people feel more positive towards it.

Bhaval gmntatn

Behavioral segmentation divides customers into groups based on the way they respond to, use or

know of a product.

12. Blw th ln:

Below the line is a term commonly used to refer to non-media advertising or promotion when no

commission has been paid to the advertising agency. This includes direct mail, point of sale displays,

and other sales promotions.

13. Bnchmakng:

The process of comparing the products and services of a business against those of competitors

in a market, or leading businesses in other markets, in order to nd ways of improving quality and

performance.

14. Benetsegmentation:

Benet segmentation relates to the process of dividing a market based on the specic benets

consumers seek from a product. For example, some car buyers want safety and security from their

car, while others look for comfort or speed. A car manufacturer, therefore, has to decide which benets

to offer and how these benets should be communicated to the customer.

15. Btn Gp Matx

A means of analyzing and categorizing the performance of business units in large diversied rms

by reference to market share and growth rates. It was developed by the Boston Consultancy Group

(BCG).


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16. Band

A brand is the specic type of the product form. A brand represented by a brand name, symbol,

design, logo, packaging is the identity of a particular product form that customers recognise as

being different from others.

17. Band bldng:

Developing a brands image and standing with a view to creating long term benets for brand

awareness and brand value.

18. Band qt

Brand equity refers to the value of a brand. Brand equity is based on the extent to which the brand

has high brand loyalty, name awareness, perceived quality and strong product associations. Brand

equity also includes other intangible assets such as patents, trademarks and channel relationships.

19. Band xtnn:

Brand extension refers to the use of a successful brand name to launch a new or modied product

in a new market. Virgin is perhaps the best example of how brand extension can be applied into quite

diverse and distinct markets.

20. Band mag

Brand image refers to the set of beliefs that customers hold about a particular brand. These are

important to develop well since a negative brand image can be very difcult to shake off.

21. Band lalt

A strongly motivated and long standing decision to purchase a particular product or service.

22. Band cgntn

A customers awareness that a brand exists and is an alternative to purchase.

23. Bakvn

Breakeven is achieved when total contribution is equal to total xed costs. Addition contribution

earned after this point becomes prot.

24. Bak-vn pcng

Setting a price to achieve break-even on the costs of making and marketing a product (direct costs).

Breakeven is achieved when the total contribution from sales priced in this way at least equal the xed

costs of the business.

25. Bld ha

A strategy based on the Boston Matrix. Here the company can invest to increase market share (forexample turning a question mark into a star).


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26. Bn ptfl

The business portfolio is the collection of businesses and products that make up the business.

27. Bn t bn

Marketing activity directed from one business to another (as opposed to a consumer). This term is

often shortened to B2B.

28. Bng bhav

Buying behavior concerns the process that buyers go through when deciding whether or not to

purchase goods or services. Buying behavior can be inuenced by a variety of external factors and

motivations, including marketing activity.

29. Cah Cw

A term used in the Boston Group Matrix. Cash cows are low-growth businesses or products with a

relatively high market share. These are mature, successful businesses with relatively little need for

investment. They need to be managed for continued prot - so that they continue to generate the

strong cash ows that the company needs for its Stars.

30. Channelconict

Disagreement among members of a distribution channel about who should be paid what and what

roles each should play. Channel conict often occurs when a business uses a multi-channel approach

to distribution.

31. Cgntv dnanc

Cognitive dissonance is an customer effect commonly observed after a major purchase whereby

the customer feels uncertainty about whether the purchase should have been made. Post-purchase

promotion (particularly advertising) has a role to play to reduce the incidence and effect of cognitive

dissonance.

32. Cmbnatn band:

A combination brand name brings together a family brand name and an individual brand name.

The idea here is to provide some association for the product with a strong family brand name but

maintaining some distinctiveness so that customers know what they are getting.

33. Cmpttv advantag:

A competitive advantage is a clear performance differential over the competition on factors that are

important to customers.

34. Cmptt bnchmakng

Competitor benchmarking compares customer satisfaction with the products, services and relationships

of the business with those of key competitors.


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35. Cnm b

Consumer buyers are those who purchase items for their personal consumption.

36. Cnm dabl

Consumer durables have low volume but high unit value. Consumer durables are often further divided

into White goods (e.g. fridge freezers; cookers; dishwashers; microwaves) and Brown goods (e.g.DVD players; games consoles; personal computers).

37. Cnm makt

Consumer markets are the markets for products and services bought by individuals for their own or

family use.

38. Cntn makt ach

Continuous research involves interviewing the same sample of people, repeatedly.

Cntbtn

Contribution per unit can be dened as selling price less variable costs. Overall contribution is the

difference between total sales revenues and variable costs.

39. C pdct

The set of problem-solving or need-meeting benets that customers are buying when they purchase

a product. Customers are rarely prepared to pay a premium for these elements of a product.

40. Ct ladhp

A strategy of producing goods at a lower cost than the competition. This usually requires the business

to enjoy higher economies of scale or have some kind of productivity advantage.

41. C-llng

Using a customers buying history to select them for related offers, e.g.a car alarm for new car buyers.

42. Ctm dmand

Consumer demand is a want for a specic product supported by an ability and willingness to pay for it.

43. Ctm lalt

Feelings or attitudes that incline a customer either to return to a company, shop or outlet to purchase

there again, or else to re-purchase a particular product, service or brand.

44. Ctm nd

A need is a basic requirement that an individual wishes to satisfy.


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45. Ctm atfactn

The provision of goods or services which fulll the customers expectations in terms of quality and

service, in relation to price paid.

46. Ctm want

A want is a desire for a specic product or service to satisfy the underlying need.

47. Dcln tag

The last stage of a products life cycle, during which sales fall rapidly.

48. Dmgaphc gmntatn

Demographic segmentation consists of dividing the market into groups based on variables such as

age, gender family size, income, occupation, education, religion, race and nationality.

49. Dpth ntvw

A lengthy, one-to-one structured interview, examining in detail a consumers views about a product.

50. Dffntatn

A marketing strategy aimed at ensuring that products and services have a unique element to allow

them to stand out from the rest.

51. Dct mal

The delivery of an advertising or promotional message to customers or potential customers by mail.

52. Dct maktng

The planned recording, analysis and tracking of customer behavior to develop a relational marketing

strategies.

53. Dct pn advtng

Direct response advertising is that which incorporates a contact method such as a phone number,

address and enquiry form, web site URL or email address. This is done with the intention of encouragingthe recipient to respond directly to the advertiser by requesting more information, placing an order etc.

The use of this technique on television is commonly referred to as DRTV advertising.

54. Dtbtn channl

The network of organizations necessary to distribute goods or services from the manufacturers to

the consumers; the distribution channel therefore potentially consists of manufacturers, distributors,

wholesalers, and retailers.

55. Dtbt

Companies that buy and sell on their own account but tend to deal in the goods of only certain

specied manufacturers.


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56. Dvt

A strategy based on the Boston Matrix. Here the company can divest the SBU by phasing it out or

selling it - in order to use the resources elsewhere (e.g. investing in the more promising question

marks).

57. Dg

A term used in the Boston Group Matrix. Unsurprisingly, the term dogs refers to businesses or

products that have low relative share in unattractive, low-growth markets. Dogs may generate enough

cash to break-even, but they are rarely, if ever, worth investing in.

58. eal adpt

People who choose new products carefully and are often consulted by people from the remaining

adopter categories.

59. eal majt

People who adopt products just prior to the average person.

60. e-cmmc

The use of technologies such as the Internet, electronic data exchange and industry extranets to

streamline business transactions.

61. endmnt

The promotion of some kind of product recommendation or afrmation, usually from a celebrity,implying to the potential customer that a product is good.

62. expanntc pcng:

Expansionistic pricing is a more exaggerated form of penetration pricing and involves setting very

low prices aimed at establishing mass markets, possibly at the expense of other suppliers. Under this

strategy, the product enjoys a high price elasticity of demand so that the adoption of a low price leads

to signicant increases in sales volumes.

63. extnctn pcng

Extinction pricing has the overall objective of eliminating competition, and involves setting very low

prices in the short term in order to undercut competition, or alternatively repel potential new entrants.

64. Faml band nam

A family brand name is used for all products. By building customer trust and loyalty to the family brand

name, all products that use the brand can benet.

65. Faml lf ccl

The stages of family life based on demographic data that are useful in dening the markets for certaingoods and services. Each group has its own specic and distinguishable needs and interests.


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66. Fat-mvng cnm gd

Fast-moving consumer goods are those that sell in high volumes, with low unit value, and have fast

consumer repurchase. Good examples include ready meals, baked beans, newspapers etc.

67. Fc gp

A small group of sample customers who are brought together into a group discussion to measure theirresponse to a marketing stimulus such as a new brand or product.

68. Fcatng

The process of estimating future demand by anticipating what buyers are likely to do under a given set

of marketing conditions (e.g. economic condence, disposal income, pricing levels).

69. Fanchng

The selling of a license by the owner (franchisor) to a third party (franchisee) permitting the sale of a

product or service for a specied period. In business format franchising the agreement will involve a

common brand and marketing format. Many service businesses are operated under franchise include

well-known brands such as Burger King, KFC and KwikPrint.

70. Fll ct pcng

Full cost plus pricing seeks to set a price that takes into account all relevant costs of production.

71. Gnd gmntatn

The segmentation of markets based on the sex of the customer. The cosmetic industry is a goodexample of widespread use of gender segmentation.

72. Ggaphc gmntatn:

Geographic segmentation divides markets into different geographical units.

73. Gng-at pcng

A pricing strategy that sets price largely based on the prices of competitors.

74. Gwth tag

The stage at which a products sales rise rapidly and prots reach a peak, before leveling off into

maturity.

75. Havt

A strategy based on the Boston Matrix. Here the company reduces the amount of investment in order

to maximize the short-term cash ows and prots from the SBU. This may have the effect of turning

Stars into Cash Cows.


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76. Hld

A strategy based on the Boston Matrix. Here the company invests just enough to keep the SBU in its

present position.

77. impl bng Bhav

that involves no conscious planning but results from a powerful, persistent urge to buy somethingimmediately.

78. incm latct f dmand

Income elasticity of demand measures the relationship between a change in quantity demanded and

a change in income.

79. indtal b

Industrial buyers are those who purchase items on behalf of their business or organization.

80. indtal makt

Industrial markets involve the sale of goods between businesses. These are goods that are not aimed

directly at consumers.

81. inf gd

Inferior goods have a negative income elasticity of demand. Demand falls as income rises.

82. Inuencer

A person in a group buying situation (e.g. a family) who exerts signicant inuence in the nal buying

decision.

83. intat

A person in a group buying situation (e.g. a family) who rst suggests buying a particular product or

service.

84. innvat

Innovators are those who adopt new products rst. They are usually relatively young, lively, intelligent,

socially and geographically mobile. They are often of a high socioeconomic group (ABs).

85. intnv dtbtn

Intensive distribution aims to provide saturation coverage of the market by using all available outlets.

86. intnal maktng

The process of eliciting support for a company and its activities among its own employees, in order to

encourage them to promote its goals. This process can happen at a number of levels, from increasingawareness of individual products or marketing campaigns, to explaining overall business strategy.


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87. intdctn tag

A products rst appearance in the marketplace, before any sales or prots have been made.

88. invlvmnt

The level of interest, emotion and activity which the consumer is prepared to expend on a particular

purchase.

89. Lablng

Packaging information that can be used for a variety of promotional, informational and legal purposes.

90. Laggad

The group of consumers who are typically last to buy a new product.

91. Lat majtPeople who are quite skeptical about new products but eventually adopt them because of economic

necessity or social pressure.

92. Lftl

Lifestyle is a persons pattern of living as expressed in his or her activities, interests and opinions.

93. Lftl gmntatn

Lifestyle segmentation of a market is based on identifying lifestyle characteristics of customers thatenable target customer groups to be identied. Many businesses now segment their markets by

lifestyles, as these are increasingly seen as good predictors of consumer behavior.

Most companies use off-the-shelf research-agency classications (such as the Target Group Index),

because of the high cost and complexity of developing their own.

94. Lg

A graphic, usually consisting of a symbol and/or group of letters that identies a company or brand.

95. Mac fcatng

Macro forecasting is concerned with forecasting markets in total. This is about determining the existing

level of Market Demand and considering what will happen to market demand in the future.

96. Mal panl

Groups of consumers selected to represent a market or market segment who agree to be regularly

interviewed by mail.

97. Manfact band

Manufacturer brands are created by producers and bear their chosen brand name. The producer is

responsible for marketing the brand. The brand is owned by the producer. By building their brand


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names, manufacturers can gain widespread distribution (for example by retailers who want to sell the

brand) and build customer.

98. Mak lad

The business in a market with the largest market share. The market leader, particularly one with a

dominant market share, is often followed by competitors in terms of pricing and product strategy.

99. Makt

A market is the demand for a particular product or service, often measured by sales during a specied

period.

100. Makt challng

A business in a market that is ghting hard to increase its market share.

101. Makt cncntatn

Market concentration is the proportion of market value that is owned by the leading brands or products/

companies in the market. Where the market leaders own a large part of the overall market, the market

is said to be highly concentrated. By contrast, where the market leader has a relatively small market

share and there are many other competitors, a market is said to be fragmented.

102. Makt dvlpmnt

The process of growing sales by offering existing products (or new versions of them) to new customer

groups (as opposed to simply attempting to increase the companys share of current markets).

103. Makt nt

The launch of a new product into a new or existing market. A different strategy is required depending

on whether the product is an early or late entrant to the market; the rst entrant usually has an

automatic advantage, while later entrants need to demonstrate that their products are better, cheaper

and so on.

104. Makt fllw

A rm that is happy to follow the leaders in a market place without challenging them, perhaps taking

advantages of opportunities created by leaders without the need for much marketing investment of itsown - see also market challenger and market leader.

105. Makt ptnng

A marketing strategy that will position a business products and services against those of its competitors

in the minds of consumers. To achieve positioning success it is suggested that there are four basic

competitive strategies that a company can follow (based on work by Porter):

- Ct ladhp - the company tries to achieve lowest costs of production and distribution.

- Dffntatn - making use of specic marketing mixes - Focus - paying attention to a fewmarket segments The fourth strategy is a losing strategy in which a business pursues a middle-


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of-the-road path. Businesses that try to be good at everything are rarely particularly good at

anything.

106. Makt ach

The systematic gathering, recording and analyzing of data about problems relating to the marketing

of goods and services.

107. Makt gmnt

A customer group within the market that has special characteristics which are signicant to marketing

strategy.

108. Makt gmntatn

Segmentation involves subdividing markets, channels or customers into groups with different needs,

to deliver tailored propositions which meet these needs as precisely as possible.

109. Makt ha

Market share can be dened as the percentage of all sales within a market that is held by one brand

/ product or company.

110. Makt tagtng

Market targeting is the process of evaluating each market segment and selecting the most attractive

segments to enter with a particular product or product line.

111. Maktng

The all-embracing function that links the business with customer needs and wants in order to get the

right product to the right place at the right time.

112. Maktng adt

A systematic examination of a businesss marketing environment, objectives, strategies, and activities

with a view to identifying key strategic issues, threats and opportunities.

113. Maktng cncpt

The marketing concept is about matching a business capabilities with customer wants.

114. Maktng ntllgnc

The composite of all data and ideas available within an organization that assists in decis

frequently asked questions marketing[1]

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