The Seven Ps of the Marketing Mix Definitions Flashcards
Product life cycle
the length of time from when a product is first introduced to when it is removed from the market
Research and development stage(R&D)
the stage before the product is launched, where the business focuses on market research, product development and preparation of production
Introduction stage
the first stage of the product life cycle, when the product is initially launched into the market
Growth stage
the second stage of the product life cycle, which is characterised by an increase in sales over time
Maturity stage
the third stage of the product life cycle, where sales are stable over a period of time(i.e. sales will still be growing, but at a slower rate)
Decline stage
the fourth stage of the product life cycle, where sales and/or market share decreases
Extension strategies
methods used by businesses to keep a product in the maturity stage of the product life cycle(i.e. lengthen the maturity stage), rather than letting it go into the decline stage
Distribution channel
the network used to move a product from the manufacturer to the end users
Brand
a name, symbol or design that is used to identify a product or company
Brand awareness
the degree to which consumers recognise a product by its name and special characteristics
Brand development
the process of building brand awareness by cultivating the business’s values and consumer perceptions of the product
Brand loyalty
a situation where customers continue to buy a particular brand, even when alternatives exist
Brand value
the monetary worth of a brand as an intangible asset, if a business was to be interested in selling it
Markup
the amount of money added to the cost price of goods to cover overheads and profit
Overhead
referring to a cost that is incurred for the upkeep(running) of a business and not attributable to individual products or items
Cost-plus(markup) pricing
a pricing strategy whereby all direct costs and some allocation of indirect costs are added together, along with some markup(either a fixed or percentage amount) to determine the sales price to customers
Penetration pricing
a pricing strategy where the business sets a very low price on a new product or service to encourage customers to buy it; later the price is increased
Fast moving consumer goods(FMCG)
products that are sold quickly, consumed regularly, and typically have a short shelf life
Loss leader
a product that is sold at a loss to attract customers
Loss leader pricing
a pricing strategy in which a product is priced lower than its production cost in order to attract customers who can then be sold other, more expensive products
Monopoly
a situation in which a market is dominated by one supplier
Predatory pricing
a pricing strategy where a business sells a product or service at such a low price that businesses cannot compete and are forced to leave the market; the remaining business can then enjoy a monopoly position and raise prices accordingly
Premium pricing
a pricing strategy where a business sets the price of its products higher to create the impression that the products are of higher quality or value than their lower-cost equivalents
Dynamic pricing/price discrimination
a pricing strategy where the same product is sold to different customers at different prices(based on time, the specific group of customers, etc.)
Competitive pricing
a pricing strategy where the price of a company’s goods or services is based upon what its competitors are charging for similar goods and services
Contribution pricing
a pricing strategy where the price charged for a product reflects the variable(direct) costs plus some markup(the latter of which is the contribution to fixed costs)
Contribution
the price of the product minus the variable(direct) costs per unit(in contribution pricing)
Demand
the willingness and ability of customers to buy products at a particular price and time
Price elasticity of demand(PED)
a measure of how sensitive consumer demand is to changes in the price of a product
Price elastic demand
a situation where a price change in a product causes a more than proportional change in its demand
Price inelastic demand
a situation where a price change in a product causes a less than proportinal change in its demand
Unitary elastic demand
a situation where the demand for a product changes proportionally to its price
Subsitute goods
a product that customers see as the same(or similar enough to) as another product
Above the line promotion(ATL)
promotion aimed at mass audiences, and are generally not targeted
Below the line promotion(BTL)
promotion aimed at specific segments and do not rely on mass market audiences
Through the line promotion(TTL)
an intergrated marketing approach that includes both above the line and below the line elements
Direct marketing
a form of marketing communication that uses one or more types of media(e.g. emails, phone calls, letters, etc.) to communicate directly with a target audience and measure their response
Conversion
the process of getting customers or potential customers to respond to the ‘call to action’ of a business
Digital marketing
the use of the internet, mobile devices, social media, search engines, and other channels to reach consumers
Loyalty program
a marketing approach that recognizes and rewards customers who purchase or engage with a brand on a recurring basis
Merchandising
the promotion of goods that are available for purchase for both wholesale and retail sales
360-degree marketing
a marketing campaign that reaches customers at all possible points of contact(i.e. both ATL and BTL promotion)
Intermediary
a person or business that acts a go-between in a transaction
Wholesaler
a business selling goods in large quantities to retailers, generally at a low price
Breaking bulk
a practice in which wholesalers break larger units of products into smaller units to deliver to retail outlets
Place
an element of the marketing mix related to the physical distribution of products
Agent
a person who acts on behalf of another person or group
Commission
a type of payment to an employee or agent based on the number of sales or a percentage of the value of sales
Distribution channel
the network of businesses or intermediaries through which a good or service passes until it reaches the end consumer
Direct distribution
a type of distribution in which the producer deals directly with the customers(i.e. does not involve intermediaries)
Indirect distribution
a type of distribution channel in which the producer reaches the customers via one or more intermediaries
Broker
a person who buys and sells products for others
People
those who are involved in offering a service; an element of the marketing mix
Induction
training for new employees when they first start work at an organisation
Process
an element of the (services part of) the marketing mix related to the activities needed in the interaction between the customer and the business
Q-commerce(quick commerce)
a type of e-commerce where emphasis is placed on quick deliveries, typically in less than an hour
Dark store
a warehouse store that provides items for online shopping(i.e. for e-commerce, especially Q-commerce) and are needed for the quick delivery og foods to a client
After-sales service
the maintenance, help and information that a business procides to the customer after they purchase a product
Product porfolio
the collection of all the products and services a company offers to its customers
