Industry Analysis Flashcards
Test marketing
The process of testing products among potential users
Focus groups
A group of customers who meet under the direction of a discussion facilitator to communicate opinions
Marketing
The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have a value for customers, clients, partners, and society at large
Market concept
A three part business philosophy:
- Customer orientation
- Service orientation
- A profit orientation
Customer relationship management (CRM)
The process of learning as much as possible about customers and doing everything you can to satisfy them or even exceed their expectations with goods and services
Marketing mix
The ingredients that into a marketing program: product, Price, place, and promotion
Product
Any physical good, service or idea that satisfies a want or need plus anything that would enhance the the product in the eyes of the consumers such as the brand
Brand name
A word letter or group of words or letters that differentiates one sellers goods and services from those of competitors
Promotion
All the techniques sellers use to inform people about and motivate them to buy their goods and services
Market research
The analysis of markets to determine opportunities and challenges, and to find the information needed to make good decisions
Secondary data
Information that has already been compiled by others and published in journals and books or made available online.
Primary data
Data that you gather yourself( not from secondary sources like books or magazines)
Environmental scanning
The process of identifying the factors that can affect marketing success
Consumer market
All the individuals or households that want goods or services for the personal consumption for use.
Business to business market
All the individuals and organizations that want goods and services to use in producing other goods and services to use in producing other goods and services to sell, rent, or supply goods to others
Market segmentation
The process of dividing the total market into groups whose members have similar characteristics
Target marketing
Marketing directed toward those groups (market segments) an organization decides it can serve profitably
Geographic segmentation
Dividing a market by cities countries, states, or regions
Demographic segmentation
Dividing the market by age, income, and education level
Psychographic segmentation
Dividing the market using groups groups values attitudes and interests
Benefit segmentation
Deciding the market by determining which benefits of the product to talk about
Volume or usage segmentation
Dividing the market by usage (volume of use)
Niche marketing
The process of finding small but profitable market segments and designing or finding products for them
One to one marketing
Developing a unique mix of goods and services for each customer
Mass marketing
Developing products and promotions to please large groups of people
Relationship marketing
Marketing strategy with the goal of keeping individual customers over time by offering them products that exactly meet their requirements
Value
Good quality at a fair price. When consumers calculate the value of a product, they look at the benefits and then subtract the cost to see if the benefits exceed the costs
Distributed product development
Handing off various parts of your innovation process often to companies in other countries
Total product offer
Everything that consumers evaluate when deciding whether to buy something; also called a value package
Product line
A group of products that are physically similar or are intended for a similar market
Product mix
The combination of product lines offered by a manufacturer
Product differentiation
The creation of real or perceived product differences
Convenience goods and services
Products that the consumer wants to purchase frequently and with a minimum of effort
Shopping goods and services
Those products the consumer buys only after comparing value quality price and style from a variety of sellers
Specialty goods and services
Consumer products with unique characteristics and brand identity. Because these products are perceived as having no reasonable substitute the consumer puts forth a special effort to purchase them
Unsought goods and services
Products that consumers are unaware of, haven’t necessarily thought of buying, or that they need to solve an unexpected problem
Industrial goods
Products used in the production of other products sometimes called business goods or business to business goods.
Bundling
Grouping two or more products together and pricing them as a unit
Brand
A name or symbol or design that identifies the goods or services of one seller or group of sellers and distinguishes them from the goods and and services of competitors
Trademark
A brand that has exclusive legal protection for both its brand name and its design
Manufacturers brands
The brand names of the manufacturers that distribute products nationally
Dealer (private-label) brands
Products that don’t carry the manufacturers name but carry a distributor or retailers name instead
Generic goods
Nonbranded products that usually sell at a sizable discount compared to national or private label brands
Knockoff brands
Illegal copies of national name brand goods
Brand equity
The value of the brand name and associated symbols
Brand loyalty
The degree to which customers are satisfied, like the brand, and are commuted to further purchases
Brand awareness
How quickly or easily a brand name comes to mind when a category is mentioned
Brand association
The linking of a brand to other favorable images
Brand manager
A manager who has direct responsibility for one brand or one product line; called a product manager in some firms
Product screening
A process designed to reduce the number of new product ideas being worked on at any one time
Product analysis
Making cost estimates and sales forecasts to get a feeling for profitability of new product ideas
Concept testing
Taking a product idea to consumers to test their reactions
Commercialization
Promoting a product to distributors and retailers to get wide distribution and developing strong advertising and sales campaigns to generate and maintain interest in the product among distributors and consumers
Product life cycle
A theoretical model of what happens to sales and profits for a product class over time; the four stages of the cycle are introduction, growth, maturity, and decline.
Target costing
Designing a product so that it satisfies customers and meets the profit margins desired by the firm
Competition based pricing
A pricing strategy based on what all other competitors are doing
Price leadership
The strategy by which one or more dominant firms set the pricing practices that all competitors in the industry follow
Break even analysis
The process used to determine profitability at various levels of sales
Total fixed costs
All the expenses that remain the same no matter how many products are sold or made
Variable cost
Costs that change according to levels of production
Skimming price strategy
Strategy in which a new product is priced high to make optimum profit while there’s little competition
Penetration strategy
Strategy in which a product is priced low to attract many customers and discourage competition
Everyday low pricing (EDLP)
Setting prices lower than competitors and then not having any special sales
High-low pricing strategy
Setting prices higher thaN EDLP stores but then setting many sales that lower prices below that of competitors
Psychological pricing
Pricing goods and services at price points to make that product appear less expensive than it is
Wholesaler
A marketing intermediary that sells to other organization
Agents/brokers
Marketing intermediaries who bring buyers and sellers together and assist in negotiating an exchange but don’t take title to the goods
Retailer
An organization that sells to ultimate consumers
Department stores
Sell a wide variety of items in separate departments (sears)
Discount store
Sells many different products generally at prices below that of department stores (Walmart)
Supermarket
Sells mostly food with other non food products like paper towels and detergent (Kroger)
Warehouse club
Sells food and general products usually in bulk (Costco)
Convenience store
Sells food and often needed products and may stay open 24/7 (7-eleven)
Category killer
Sells a large variety of one type of product to dominate that category of goods (office max, toys r us)
Outlet store
Sells products directly from the manufacturer at a discount (Nike)
Specialty store
Sells a wide selection of goods in one category
Supply chain
The sequence o linked activities that must be performed by various organizations to move goods from the sources of raw materials to ultimate consumers
Supply chain management
The process of managing the movement of raw materials, parts, work in progress, finished goods, and related information through all the organizations involved in the supply chain ; managing the return of such goods if necessary and recycling materials when appropriate
Cross docking
Unloading products from one truck immediately to another for delivery to retailer
Managerial accounting
Accounting used to provide information and analyses to managers inside the organization to assist them in decision making
Financial accounting
Accounting information and analyses prepared for people outside the organization
Steps of the accounting cycle
- Analyze source documents
- Record transactions in journals
- Transfer journal entries to ledger
- Take a trial balance
5 prepare financial statements
- Analyze financial documents
Balance sheet
A statement of assets and liabilities. Shows capital of a business at a particular point in time.
Income statement
Shows revenues or expenses of an organization during s certain period
Cash flow statement
Financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents and breaks down to operating investing and financing activities
Assets=
Liabilities+net worth
Liquidity
The ease with which an asset can be converted into cash
Current assets
Items that can or will be converted into cash within the next year
Fixed assets
Assets that are relatively permanent such as land buildings or equipment
Intangible assets
Long term assets that have no real physical form but do have value (patents, trademarks, copyrights)
Accounts payable
Current liabilities or bills the company owes others for merchandise it purchased on credit
Notes payable
Short term or long term liabilities that businesses promise to repay at a certain date
Bonds payable
Long term liabilities that represent money lent to the firm that must be paid back
Owners equity
The amount of business that belongs to the owners minus any liabilities owed by the business
Retained earnings
The accumulated earnings from a firms profitable operations that were reinvested in the business and not payed back to stock holders in dividends
Current liquidity ratio
Current assets/ current liabilities
A 2 or better is considered a safe risk shows how financially secure a business is
Acid test liquidity ratio
Cash+accounts receivable+marketable securities
———-——————
Current liabilities
0.5-1 is good tells whether company can pay off short term debt if sales drop
Marketing mix (4 parts)
- Designing a want satisfying PRODUCT
- setting a PRICE for the product
- Putting the product in a PLACE where people will buy it.
- PROMOTING the product
Profitability ratios
Show how efficiently company is using resources to make a profit
Activity ratios
Shows us how efficiently inventory is being turned over
Financial management
A job of managing a firms resources so it can meet its goals and objectives
Financial managers
Managers who examine financial data prepared by accountants and recommended strategies for improving the financial performance of the firm
Undercapitalization
Insufficient funds
Poor cash flow
Means that you are spending more than you are making
Inadequate expense control
Having more expenses than your assets can compensate for
Short term financing
Funds needed for a year or less
Long term financing
Funds needed for a year or more( usually 2-10 years)
Profitability ratios
Show how efficiently company is using resources to make a profit
Activity ratios
Shows us how efficiently inventory is being turned over
Financial management
A job of managing a firms resources so it can meet its goals and objectives
Financial managers
Managers who examine financial data prepared by accountants and recommended strategies for improving the financial performance of the firm
Undercapitalization
Insufficient funds
Poor cash flow
Means that you are spending more than you are making
Inadequate expense control
Having more expenses than your assets can compensate for
Short term financing
Funds needed for a year or less
Long term financing
Funds needed for a year or more( usually 2-10 years)
