8.7: Key Terms

advertising

mass communication that allows companies to reach a broad audience through TV, radio, newspaper, Internet, magazines, and outdoor ads

brand

image a company promotes and the connotations it fosters of itself and its products

brand advocate

someone who is a fan of your products and passes on the word to others

brand strategy

image a company conveys to its customers

bundling

bundle of products that is discounted to encourage customers to buy in bulk

causal research

identification of cause-and effect-relationships between two or more variables

close

step in the sales process in which the salesperson asks for and gets the sale

conjoint analysis

survey tool in which respondents must rank, choose, or a rate a number of “conjoint,” or linked, features or benefits

cost-led pricing

easiest way to price a product by taking the cost of making the product and marking it up to create profit

customer-led pricing

pricing led by what the customer is willing to pay

digital marketing

online marketing

direct mail

connecting to consumers via email or through printed mailed pieces

entrepreneurial marketing

set of unconventional practices that can help start-ups and younger firms survive in competitive markets

ethnographic research

use of personal observation of the subject by being immersed in the subject’s environment

executive summary

initial section of a business plan document that summarizes the key elements of the entire plan

expeditionary marketing

marketing designed to move established companies and their products into new markets and territories

focus group

gathering of people, typically six to twelve participants, who come together to discuss a topic presented by a moderator, who usually poses questions and collects qualitative data that can be used to answer questions or define research further

guerrilla marketing

creative approaches to marketing that seek to gain maximum exposure through unconventional means

introductory offers

using lower initial prices to attract new customers and build a customer base before prices return to their standard amount

jingle

short song or sound that brands a product or company and helps to promote it

loss leader pricing

using a below-standard price to attract customers in the hope that they will purchase other, more profitable goods and services

market analysis

analysis of the overall interest in the product or service within the industry by its target market

market opportunity

unmet need within a target demographic

market research

collection and analysis of data related to a business’s target market

marketing

umbrella term given to those activities that companies use to identify consumers and convert them into buyers

marketing mix

basic set of possible strategies and approaches that marketers use to reach their target market

marketing plan

formal business document that used as blueprint for how a company will achieve its marketing and business goals

marketing strategy

company’s game plan for how it will reach consumers and convert them into paying customers

odd numbers strategy

psychological pricing strategy that uses odd numbers in the prices to make a product’s price point more attractive to consumers

penetration pricing

pricing below that of a competitor’s price

people

company’s human resources

personal selling

using face-to-face interactions to communicate and influence a customer to make a purchase

physical environment

where a service takes place or a product is manufactured

place

channels or locations—physical or digital—where products can be found by customers

positioning

(or value proposition) statement of how you want the customer to perceive your company, good, or service

premium pricing

charging a price above a competitor’s price

price

value that must be exchanged in order for a customer to receive a product or service

primary research

research that involves gathering new data

process

chain of procedures and/or activities required to provide the product to the customer

product

good or a service that creates value by fulfilling a customer need or desire

profit margin

amount by which revenue exceeds costs, typically described as a percent

promotion

process of communicating value to customers in a way that encourages them to buy

public relations

marketing that focuses on connecting with constituents by developing goodwill

qualitative research

use of open-ended techniques such as observation, focus groups, and interviews to gain an understanding of customers’ basic reasons, opinions, and motivations

quantitative research

generation of numerical data through techniques such as surveys and questionnaires

real-time marketing

seeks to turn immediately available sales data into actionable and timely strategies that target the shifting landscape of consumer tastes and trends

relationship marketing

creates customer loyalty through personal interaction and strives for long-term engagement

sales promotion

incentives such as coupons and discounts that help attract customers and help them take action

sales strategy

plan that the entrepreneur uses to identify and engage a consumer, from prospecting to securing the sale and beyond

sample

group of people participating in market research

secondary research

research that uses existing data

segmenting

separating the total population by homogeneous groups of people that have similar tastes, backgrounds, lifestyles, demographics, and culture

serviceable available market (SAM)

portion of the market that a business can serve based on its products, services, and location

situation analysis

examination of the internal and external circumstances relevant to a particular business

skimming

high-pricing strategy that leverages the newness of a product in order to “skim” the most profits off the top at the beginning of a sale

social media

online communication tool for entrepreneurs to connect with consumers, especially younger demographics

tagline

short and catchy positioning statement that quickly communicate some core aspect of the brand to the consumer

target market

specific group of consumers for which a company seeks to provide a good or service

targeting

selecting a customer group based on their ability and willingness to buy

total available market (TAM)

total perceived demand for a product or service within the marketplace

validation

act of verifying that a product can be successful with a target audience

viral marketing

marketing that uses engaging content in the hopes that viewers will share it on their personal and social media networks

word-of-mouth (WOM) marketing

promotion in which a satisfied customer tells others about their positive experience with a good or service