Adding Value And Other Recent Terms Flashcards
Added value
The money added onto a product as a result of the business selling it
Advertising
Something to bring attention to the business
Product trials
Where the business allows customers to get the product for free temporarily
Branding
How businesses get customers to associate with the product
Special offers
Things like discounts on the product to entice the customer
Sponsorship
Helping someone else to gain attention
Price skimming
Where businesses price themselves really high in order to maximise profits while demand from customers is high
Penetration pricing
Where businesses price themselves low in order to break into the market
Psychological pricing
Where the consumer is given the impression that the product is a better deal
Competitive pricing
Where businesses price themselves at or lower than the price of their competition
Distribution channels
How products get from the manufacturer to the consumer
Wholesale channel
Traditional distribution channel. From manufacturer to wholesaler (who buys in bulk) to Retailer (Who sometimes buys in bulk) to consumer who just buys one or two products
Retail channel
Manufacturer straight to the retailer then to the customer. Cheaper for customer but more strain on retailer.
Manufacturer channel
Made by the manufacturer and goes straight to the consumer. Really cheap for customer but the manufacturer may struggle to sell.
Internal growth
When a business uses its own money to expand itself
External growth
Two or more businesses join to form a new business
(Theme 1 flash cards as well) Excise duties
Individuals pay these extra taxes when they buy certain products such as cigarettes or alcohol
Corporation tax
Businesses pay this on profits they make
Demographics
The segmentation relating to the structure of the population. E.g family dynamics
Interest rate
The percentage of money that is added onto the debt you owe or the money you save
