Definitions for exam Flashcards
1
Q
product
A
Anything that is of value to a consumer and can be offered through a marketing exchange.
2
Q
innovation
A
The process by which ideas are transformed into new products and services that will help firms grow.
3
Q
reverse engineering
A
Involves taking apart a competitor’s product, analyzing it, and creating an improved product that does not infringe on the competitor’s patents, if any exist.
4
Q
product development
A
Entails a process of balancing various engineering, manufacturing, marketing, and economic considerations to develop a product.
5
Q
alpha testing
A
An attempt by the firm to determine whether a product will perform according to its design and whether it satisfies the need for which it was intended; occurs in the firm’s R&D department
6
Q
beta testing
A
Having potential consumers examine a product prototype in a real-use setting to determine its functionality, performance, potential problems, and other issues specific to its use.
7
Q
premarket test
A
Conducted before a product or service is brought to market to determine how many customers will try and then continue to use it.
8
Q
test marketing
A
Introduces a new product or service to a limited geographical area (usually a few cities) prior to a national launch.
9
Q
product life cycle
A
Defines the stages that new products move through as they enter,
get established in, and ultimately leave the marketplace and thereby offers marketers a starting point for their strategy planning
10
Q
introduction stage
A
Stage of the product life cycle when innovators start buying the product.
11
Q
growth stage
A
Stage of the product life cycle when the product gains acceptance, demand and sales increase, and competitors emerge in the product category.
12
Q
maturity stage
A
Stage of the product life cycle when industry sales reach their peak, so firms try to rejuvenate their products by adding new features or repositioning them.
13
Q
decline stage
A
Stage of the product life cycle when sales decline and the product eventually exits the market.
14
Q
core consumer value
A
the basic problem solving benefits that consumers are seeking
15
Q
associated services (or augmented product)
A
The nonphysical attributes of the product, including product warranties, financing, product support, and after-sale service.
16
Q
consumer products
A
products and services used by people for their personal use
17
Q
specialty goods/services
A
Products or services toward which the customer shows a strong preference and for which he or she will expend considerable effort to search for the best suppliers.
18
Q
shopping goods/services
A
Products or services, such as apparel, fragrances, and appliances, for which consumers will spend time comparing alternatives.
19
Q
convenience goods/ services
A
Products or services for which the consumer is not willing to spend any effort to evaluate prior to purchase
20
Q
product mix
A
The complete set of all products offered by a firm.
21
Q
product lines
A
Groups of associated items, such as those that consumers use together or think of as part of a group of similar products.
22
Q
product category
A
An assortment of items that the customer sees as reasonable substitutes for one another.
23
Q
product mix breadth
A
The number of product lines, or variety, offered by the firm.
24
Q
product line depth
A
The number of products within a product line.
25
brand equity
The set of assets and liabiliies linked to a brand that add to or subtract from the value provided by the product or service
26
brand awareness
Measures how many consumers in a market are familiar with the brand and what it stands for; created through repeated expo- sures of the various brand elements (brand name, logo, symbol, character, packaging, or slogan) in the firm’s communications to consumers.
27
perceived value
The relationship between a product or service’s benefits and its cost.
28
brand associations
The mental links that consumers make between a brand and its key product attributes; can involve a logo, slogan, or famous personality.
29
brand personality
Refers to a set of human characteristics associated with a brand, which has symbolic or self-expressive meanings for consumers.
30
brand loyalty
Occurs when a consumer buys the same brand’s product or service repeatedly over time rather than buying from multiple suppliers within the same category.
31
manufacturer brands
Brands owned and man- aged by the manufacturer.
32
private-label brands
(store brands) Brands developed and marketed by a retailer and available only from that retailer.
33
generic
A product sold without a brand name, typically in commodities markets.
34
corporate brand
The use of a firm’s own corporate name to brand all of its product lines and products.
35
family brand
The use of a combination of the company brand name and individual brand name to distinguish a firm’s products.
36
individual brand
The use of individual brand names for each of a firm’s products.
37
brand extension
The use of the same brand name for new products being introduced to the same or new markets.
38
brand dilution
Occurs when a brand extension adversely affects consumer perceptions about the attributes the core brand its believed to hold
39
cobranding
The practice of marketing two or more brands together, on the same package or promotion.
40
brand licensing
A contractual arrangement between firms, whereby one firm allows another to use its brand name, logo, symbols, or characters
in exchange for a negotiated fee.
41
intangible
A characteristic of a service; it cannot be touched, tasted, or seen like a pure product can.
42
inseparable
A characteristic of a service: it is produced and consumed at the same time—that is, service and consumption are inseparable
43
inconsistent
A characteristic of a service: its quality may vary because it is provided by humans.
44
inventory
A characteristic of a service: it is perishable and cannot be stored for future use.
45
service gap
Results when a service fails to meet the expectations that customers have about how it should be delivered.
46
knowledge gap
Reflects the difference between customers’ expectations and the firm’s perception of those expectations.
47
standards gap
Pertains to the difference between the firm’s perceptions of customers’ expectations and the service standards it sets.
48
delivery gap
The difference between the firm’s service standards and the actual service it provides to customers.
49
communication gap
Refers to the difference between the actual service provided to customers and the service that the firm’s promotion program promises.
50
service quality
Customers’ perceptions of how well a service meets or exceeds
their expectations.
51
Zone of tolerance
The area between customers’ expectations regarding their desired service and the minimum level of acceptable service— that is, the difference between what the customer really wants and what he or she will accept before going elsewhere.
52
distributive fairness
Pertains to a customer’s perception of the benefits he or she received compared with the costs (inconvenience or loss) that resulted from a service failure.
53
procedural fairness
Refers to the customer’s perception of the fairness of the process used to resolve complaints about service
54
profit orientation
A company objective that can be implemented by focusing on target profit pricing, maximizing profits, or target return pricing.
55
target profit pricing
A pricing strategy implemented by firms when they have a particular profit goal as their overriding concern; uses price to stimulate a certain level of sales at a certain profit per unit.
56
maximizing profits strategy
A mathematical model that captures all the factors required to explain and predict sales and profits, which should be able to identify the price at which its profits
are maximized.
57
target return pricing
A pricing strategy implemented by firms less concerned with the absolute level of profits and more interested in the rate at which their profits are generated relative to their investments; designed to produce a specific return on investment, usually expressed as a percentage of sales.
58
sales orientation
A company objective based on the belief that increasing sales will help the firm more than will increasing profits.
59
competitor orientation
A company objective based on the premise that the firm should measure itself primarily against its competition.
60
customer orientation
Pricing orientation that explicitly invokes the concept of customer value and setting prices to match consumer expectations.
61
oligopolistic competition
Occurs when only a few firms dominate a market.
62
monopolistic competition
Occurs when many
firms sell closely related but not homogeneous products; these products may be viewed as substitutes but are not perfect substitutes.
63
pure competition
Occurs when different companies sell commodity products that consumers perceive as substitutable; price usually is set according to the laws of supply and demand.
64
cost-based pricing method
Determines the final price to charge by starting with the cost, without recognizing the role that consumers or competitors’ prices play in the marketplace.
65
competitor-based pricing method
An approach that attempts to reflect how the firm wants consumers to interpret its products relative to the competitors’ offerings.
66
value-based pricing method
Focuses on the overall value of the product offering as perceived by consumers, who deter- mine value by comparing the benefits they expect the product to deliver with the sacrifice they will need to make to acquire the product.
67
price skimming
A strategy of selling a new product or service at a high price that innovators and early adopters are willing to pay to obtain
it; after the high-price market segment becomes saturated and sales begin to slow down, the firm generally lowers the price to capture (or skim) the next most price- sensitive segment.
68
market penetration pricing
A pricing strategy of setting the initial price low for the introduction of the new product
or service, with the objective of building sales, market share, and profits quickly.
69
reference price
The price against which buyers compare the actual selling price
of the product and
that facilitates their evaluation process.
70
odd prices
prices that end in odd numbers, usually 9
71
everyday low pricing (EDLP)
A strategy companies use to emphasize the continuity of their
retail prices at a level somewhere between the regular, nonsale price and the deep-discount sale prices their competitors may offer.
72
high/low pricing
A pricing strategy that relies on the promotion of sales, during which prices are temporarily reduced to encourage purchases.
73
price lining
Consumer market pricing tactic of establishing a price floor and a price ceiling for an entire line of similar products and then setting a few other price points in between to represent distinct differences in quality.
74
price bundling
Consumer pricing tactic of selling more than one product for a single, lower price than the items would cost sold separately; can be used to sell slow-moving items, to encourage customers to stock up so they won’t purchase competing brands, to encourage trial of a new product, or to provide an incentive to purchase a less desirable product or service to obtain a more desirable one in the same bundle.
75
predatory pricing
A firm’s practice of setting a very low price for one or more of its products with the intent of driving its competition out of business; illegal under the Competition Act.
76
price discrimination
The practice of selling the same product to different resellers (wholesalers, distributors, or retailers) or to the ultimate consumer at different prices; some, but not all, forms of price discrimination are illegal.
77
horizontal price fixing
Occurs when competitors that produce and sell competing products collude, or work together, to control prices, effectively taking price out of the decision process for consumers.
78
Push marketing strategy
Designed to increase demand by focusing on wholesalers, distributors, or salespeople, who push the product to consumers via distribution channels.
79
pull marketing strategy
Designed to get consumers to pull the product into the supply chain by demanding retailers carry it.
80
vertical marketing system
A supply chain in which the members act as a unified system; there are three types: administrated, contractual, and corporate.
81
administered vertical marketing system
A supply chain system in which there is no common ownership and no contractual relationships, but the dominant channel member controls the channel relationship.
82
contractual vertical marketing system
A system in which independent firms at different levels of the supply chain join together through contracts to obtain economies of scale and co-ordination and to reduce conflict
83
corporate vertical marketing system
A system in which the parent company has complete control and can dictate the priorities and objectives of the supply chain; it may own facilities such as manufacturing plants, warehouse facilities, retail outlets, and design studios.
84
category specialist
Offers a narrow variety but a deep assortment of merchandise.
85
category killer
Offers an extensive assortment in a particular category, so overwhelm- ing the category that other retailers have difficulty competing.
86
omnichannel
An omnichannel strategy creates a consistent experience for consumers across all distribution channels.
87
integrated marketing communications (IMC)
Represents the promotion dimension of the four Ps; encompasses a variety
of communication disciplines— general advertising, personal selling, sales promotion, public relations, direct marketing, and digital media—in combination to provide clarity, consistency, and maximum communicative impact.
88
Deceptive advertising
A representation, omission, act, or practice in an advertisement that is likely to mislead consumers acting reasonably under the circumstances
89
multichannel strategy
Selling in more than one
channel (e.g., store, catalogue,
kiosk, and Internet).
90
conventional
| supermarket
```
Offers groceries, meat,
and produce with limited
sales of nonfood items,
such as health and
beauty aids and general
merchandise, in a
self-service format.
```
91
big-box food retailers
```
Come in three types:
supercentre, hypermarket,
and warehouse club;
larger than a conventional
supermarket; carries both
food and nonfood items.
```
92
general merchandise
| retailers
```
May be discount stores,
specialty stores, category
specialists, department
stores, drugstores,
off-price retailers, or
extreme-value retailers;
may sell through multiple
channels, such as the
Internet and catalogues.
```
93
discount store
Offers a broad variety
of merchandise, limited
service, and low prices.
94
category specialist
Offers a narrow variety
but a deep assortment of
merchandise.
95
category killer
```
Offers an extensive
assortment in a particular
category, so overwhelming
the category that
other retailers have
difficulty competing.
```
96
drugstore
```
A specialty store that
concentrates on health
and personal grooming
merchandise, though
pharmaceuticals may
represent more than
60 percent of its sales.
```
97
off-price retailer
```
A type of retailer that
offers an inconsistent
assortment of merchandise
at relatively
low prices.
```
98
extreme-value retailer
A general merchandise
discount store found in
lower-income urban or
rural areas.
99
services retailers
Firms that primarily
sell services rather
than merchandise.
100
retail mix
```
Product (merchandise
assortment), pricing,
promotion, place, personnel,
and presentation
(store design and display)
strategies to reach and
serve consumers.
```
101
co-operative (co-op)
```
advertising
An agreement between a
manufacturer and retailer
in which the manufacturer
agrees to defray some
advertising costs.
```
102
share of wallet
The percentage of
the customer’s
purchases made from
a particular retailer.
103
omnichannel
```
An omnichannel
strategy creates a
consistent experience
for consumers across all
distribution channels.
```
104
sender
```
The firm from which an
IMC message originates;
the sender must be
clearly identified to the
intended audience.
```
105
deceptive advertising
```
A representation, omission,
act, or practice in
an advertisement that is
likely to mislead consumers
acting reasonably
under the circumstances.
```
106
transmitter
```
An agent or intermediary
with which the sender
works to develop the
marketing communications;
for example, a firm’s
creative department or an
advertising agency.
```
107
encoding
The process of converting
the sender’s ideas into a
message, which could be
verbal, visual, or both.
108
communication channel
The medium—print, broadcast,
the Internet—that
carries the message.
109
receiver
```
The person who reads,
hears, or sees and processes
the information
contained in the message
or advertisement.
```
110
decoding
The process by which the
receiver interprets the
sender’s message.
111
noise
```
Any interference that
stems from competing
messages, a lack of clarity
in the message, or a flaw
in the medium; a problem
for all communication
channels.
```
112
feedback loop
```
Allows the receiver to
communicate with the
sender and thereby
informs the sender
whether the message was
received and decoded
properly.
```
113
objective-and-task
| method
```
An IMC budgeting method
that determines the cost
required to undertake specific
tasks to accomplish
communication objectives;
process entails setting
objectives, choosing media,
and determining costs
```
114
competitive parity
| method
```
A method of determining
a communications budget
in which the firm’s share
of the communication
expenses is in line with
its market share.
```
115
percentage-of-sales
| method
```
A method of determining
a communications budget
that is based on a
fixed percentage of
forecasted sales.
```
116
affordable method
```
A method of determining
a communications budget
based on what is left over
after other operating
costs have been covered.
```
117
unique selling
| proposition (USP)
```
A strategy of differentiating
a product by
communicating its unique
attributes; often becomes
the common theme or
slogan in the entire
advertising campaign.
```
118
rational appeal
```
Helps consumers make
purchase decisions by
offering factual information
and strong arguments built
around relevant issues that
encourage consumers to
evaluate the brand favourably
on the basis of the key
benefits it provides.
```
119
emotional appeal
Aims to satisfy consumers’
emotional desires rather
than their utilitarian needs.
120
media planning
```
The process of evaluating
and selecting the media
mix that will deliver a
clear, consistent, compelling
message to the
intended audience.
```
121
media mix
The combination of the
media used and the
frequency of advertising
in each medium.
122
media buy
The purchase of airtime or
| print pages.
123
mass media
```
Channels, such as national
newspapers, magazines,
radio, and television, that
are ideal for reaching
large numbers of anonymous
audience members.
```
124
niche media
```
Channels that are focused
and generally used to
reach narrow segments,
often with unique demographic
characteristics
or interests.
```
125
advertising schedule
Specifies the timing and
| duration of advertising.
126
continuous advertising
| schedule
```
Runs steadily throughout
the year and therefore
is suited to products
and services that are
consumed continually at
relatively steady rates and
that require a steady level
of persuasive or reminder
advertising.
```
127
flighting advertising
| schedule
Implemented in spurts,
with periods of heavy
advertising followed by
periods of no advertising.
128
pulsing advertising
| schedule
```
Combines the continuous
and flighting schedules by
maintaining a base level of
advertising but increasing
advertising intensity during
certain periods.
```
129
pretesting
```
Assessments performed
before an ad campaign is
implemented to ensure
that the various elements
are working in an integrated
fashion and doing
what they are intended
to do.
```
130
tracking
```
Includes monitoring key
indicators, such as daily
or weekly sales volume,
while the advertisement
is running to shed light
on any problems with the
message or the medium.
```
131
post-testing
The evaluation of an IMC
campaign’s impact after it
has been implemented.
132
frequency
```
Measure of how often
the target audience is
exposed to a communication
within a specified
period of time.
```
133
reach
```
Measure of consumers’
exposure to marketing
communications; the
percentage of the target
population exposed to
a specific marketing
communication, such
as an advertisement,
at least once.
```
134
gross rating points
| GRP
Measure used for various
media advertising—print,
radio, or television;
GRP = reach × frequency.
135
click-through tracking
Measures how many times
users click on banner
advertising on websites.
136
search engine
| marketing (SEM)
Uses tools such as Google
AdWords to increase the
visibility of websites in
search engine results.
137
impressions
The number of times an
| ad appears to a user.
138
click-through rate
| CTR
The number of times
a user clicks on an ad
divided by the number of
impressions.
139
return on investment
| ROI
```
Used to measure the benefit
of an investment, ROI
is calculated by dividing
the gain of an investment
by its cost.
```
140
advertising
```
A paid form of communication
from an identifiable
source, delivered through
a communication channel,
and designed to persuade
the receiver to take some
action, now or in the future.
```
141
personal selling
```
The two-way flow of
communication between
a buyer and a seller that is
designed to influence the
buyer’s purchase decision.
```
142
sales promotions
```
Special incentives or
excitement-building programs
that encourage the
purchase of a product or
service, such as coupons,
rebates, contests, free
samples, and point-ofpurchase
displays.
```
143
direct marketing
Marketing that communicates
directly with target
customers to generate a
response or transaction.
144
direct mail/email
A targeted form of communication
distributed to
a prospective customer’s
mailbox or inbox.
145
direct response TV
| DRTV
TV commercials or infomercials
with a strong call
to action.
146
public relations (PR)
```
The organizational function
that manages the
firm’s communications
to achieve a variety of
objectives, including
building and maintaining
a positive image, handling
or heading off unfavourable
stories or events,
and maintaining positive
relationships with
the media.
```
147
cause-related
| marketing
```
Commercial activity
in which businesses
and charities form a
partnership to market
an image, product, or
service for their mutual
benefit; a type of
promotional campaign.
```
148
event sponsorship
```
A popular PR tool; occurs
when corporations support
various activities
(financially or otherwise),
usually in the cultural
or sports and entertainment
sectors.
```
149
digital media
```
Tools ranging from simple
website content to far
more interactive features
such as corporate blogs,
online games, text messaging,
social media, and
mobile apps.
```
150
blog (weblog or
| web log)
A web page that contains
periodic posts; corporate
blogs are a new form of
marketing communications.
151
AIDA Model
```
A common model of the
series of mental stages
through which consumers
move as a result of marketing
communications:
Attention leads to Interest,
which leads to Desire,
which leads to Action.
```
152
aided recall
Occurs when consumers
recognize the brand when
its name is presented
to them.
153
top-of-mind awareness
```
A prominent place in
people’s memories that
triggers a response without
them having to put
any thought into it.
```
154
lagged effect
A delayed response to a
marketing communication
campaign.
155
informative advertising
```
Communication used to
create and build brand
awareness, with the
ultimate goal of moving
the consumer through
the buying cycle to
a purchase.
```
156
persuasive advertising
Communication used to
motivate consumers to
take action.
157
reminder advertising
stage of their life cycle.
```
Communication used
to remind consumers of
a product or to prompt
repurchases, especially
for products that have
gained market acceptance
and are in the maturity stage of their life cycle.
```
158
product-focused
| advertisements
Used to inform, persuade,
or remind consumers
about a specific product
or service.
159
institutional
| advertisements
Used to inform, persuade,
or remind consumers
about a specific product
or service.
160
product placement
Inclusion of a product in
nontraditional situations,
such as in a scene in a
movie or TV program.
161
public service
| announcement (PSA)
```
Advertising that focuses
on public welfare and
generally is sponsored by
nonprofit institutions, civic
groups, religious organizations,
trade associations,
or political groups; a form
of social marketing.
```
162
social marketing
```
The application of
marketing principles to
a social issue to bring
about attitudinal and
behavioural change
among the general
public or a specific
population segment.
```
163
puffery
The legal exaggeration of
praise, stopping just short
of deception, lavished on
a product.
164
deal
```
A type of short-term
price reduction that can
take several forms, such
as a “featured price,”
a price lower than the
regular price; a “buy one,
get one free” offer; or a
certain percentage “more
free” offer contained in
larger packaging.
```
165
premium
```
An item offered for free
or at a bargain price to
reward some type of
behaviour, such as buying,
sampling, or testing
```
166
contest
A brand-sponsored
competition that requires
some form of skill
or effort.
167
sweepstakes
A form of sales promotion
that offers prizes based
on a chance drawing of
entrants’ names.
168
sampling
```
Offers potential customers
the opportunity to
try a product or service
before they make a
buying decision.
```
169
loyalty program
```
Specifically designed to
retain customers by offering
premiums or other
incentives to customers
who make multiple
purchases over time.
```
170
point-of-purchase
| (POP) display
```
A merchandise display
located at the point of
purchase, such as at the
checkout counter in a
grocery store.
```
171
pop-up stores
```
Temporary storefronts
that exist for only a
limited time and generally
focus on a new product
or a limited group of
products offered by a
retailer, manufacturer,
or service provider; they
give consumers a chance
to interact with the
brand and build brand
awareness.
```
172
cross-promoting
Efforts of two or more
firms joining together to
reach a specific target
market.
173
relationship selling
```
A sales philosophy and
process that emphasizes a
commitment to maintaining
the relationship over
the long term and investing
in opportunities that
are mutually beneficial to
all parties.
```
174
leads
A list of potential
| customers.
175
qualify
The process of assessing
| the potential of sales leads.
176
trade shows
```
Major events attended by
buyers who choose to be
exposed to products and
services offered by potential
suppliers in an industry.
```
177
cold calls
```
A method of prospecting
in which salespeople
telephone or go to see
potential customers without
appointments.
```
178
```
telemarketing
A method of prospecting
in which salespeople
telephone potential
customers.
```
A method of prospecting
in which salespeople
telephone potential
customers.
179
preapproach
```
In the personal selling
process, occurs prior to
meeting the customer for
the first time and extends
the qualification of leads
procedure; in this step,
the salesperson conducts
additional research and
develops plans for meeting
with the customer.
```
180
closing the sale
Obtaining a commitment
from the customer to
make a purchase.
