Marketing Terms 2

Front 1

Anything that can be offered to a market for attention, acquisition, use, or consumption that might satisfy a want or need.

Back 1

Product

Front 2

Any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything.

Back 2

Service

Front 3

Product bought by final consumer for personal consumption.

Back 3

Consumer product

Front 4

Consumer product that the customer usually buys frequently, immediately, and with a minimum of comparison and buying effort.

Back 4

Convenience product

Front 5

Consumer good that the customer, in the process of selection and purchase, characteristically compares on such bases as suitability, quality, price, and style.

Back 5

Shopping product

Front 6

Consumer product with unique characteristics or brand identification for which a significant group of buyers is willing to make a special purchase effort.

Back 6

Specialty product

Front 7

Consumer product that the consumer either does not know about or knows about but does not normally think of buying.

Back 7

Unsought product

Front 8

Product bought by individuals and organizations for further processing or for use in conducting a business.

Back 8

Industrial product

Front 9

The design, implementation, and control of programs seeking to increase the acceptability of a social idea, cause, or practice among a target group.

Back 9

Social marketing

Front 10

The ability of a product to perform its functions; it includes the product’s overall durability, reliability, precision, ease of operation and repair, and other valued attributes.

Back 10

Product quality

Front 11

A name, term, sign, symbol, or design, or a combination of these, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.

Back 11

Brand

Front 12

The activities of designing and producing the container or wrapper for a product.

Back 12

Packaging

Front 13

A group of products that are closely related because they function in a similar manner, are sold to the same customer groups, are marketed through the same types of outlets, or fall within given price ranges.

Back 13

Product line

Front 14

The set of all product lines and items that a particular seller offers for sale.

Back 14

Product mix (or product assortment

Front 15

The positive differential effect that knowing the brand name has on customer response to the product or service.

Back 15

Brand equity

Front 16

A brand created and owned by a reseller of a product or service.

Back 16

Private brand (or store brand)

Front 17

The practice of using the established brand names of two different companies on the same product.

Back 17

Co-branding

Front 18

Using a successful brand name to introduce additional items in a given product category under the same brand name, such as new flavors, forms, colors, added ingredients, or package sizes.

Back 18

Line extension

Front 19

Using a successful brand name to launch a new or modified product in a new category.

Back 19

Brand extension

Front 20

A major characteristic of services-they cannot be seen, tasted, felt, heard, or smelled before they are bought.

Back 20

Service intangibility

Front 21

A major characteristic of services-they are produced and consumed at the same time and cannot be separated from their providers, whether the providers are people or machines.

Back 21

Service inseparability

Front 22

A major characteristic of services-their quality may vary greatly, depending on who provides them and when, where, and how.

Back 22

Service variability

Front 23

A major characteristic of services-they cannot be stored for later sale or use.

Back 23

Service perishability

Front 24

The chain that links service firm profits with employee and customer satisfaction.

Back 24

Service-profit chain

Front 25

Marketing by a service firm to train and effectively motivate its customer-contact employees and all the supporting service people to work as a team to provide customer satisfaction.

Back 25

Internal marketing

Front 26

Marketing by a service firm that recognizes that perceived service quality depends heavily on the quality of buyer-seller interaction.

Back 26

Interactive marketing

Front 27

The development of original products, product improvements, product modifications, and new brands through the firm’s own R&D efforts.

Back 27

New-product development

Front 28

The systematic search for new-product ideas.

Back 28

Idea generation

Front 29

Screening new-product ideas in order to spot good ideas and drop poor ones as soon as possible.

Back 29

Idea screening

Front 30

A detailed version of the new-product idea stated in meaningful consumer terms.

Back 30

Product concept

Front 31

Testing new-product concepts with a group of target consumers to find out if the concepts have strong consumer appeal.

Back 31

Concept testing

Front 32

Designing an initial marketing strategy for a new product based on the product concept.

Back 32

Marketing strategy development

Front 33

A review of the sales, costs, and profit projections for a new product to find out whether these factors satisfy the company’s objectives.

Back 33

Business analysis

Front 34

Developing the product concept into a physical product in order to ensure that the product idea can be turned into a workable product.

Back 34

Product development

Front 35

The stage of new-product development in which the product and marketing program are tested in more realistic market settings.

Back 35

Test marketing

Front 36

Introducing a new product into the market.

Back 36

Commercialization

Front 37

A new-product development approach in which one company department works to complete its stage of the process before passing the new product along to the next department and stage.

Back 37

Sequential product development

Front 38

An approach to developing new products in which various company departments work closely together, overlapping the steps in the product-development process to save time and increase effectiveness.

Back 38

Simultaneous (or team-based) product development

Front 39

The course of a product’s sales and profits over its lifetime. It involves five distinct stages: product development, introduction, growth, maturity, and decline.

Back 39

Product life cycle (PLC

Front 40

A basic and distinctive mode of expression.

Back 40

style

Front 41

A currently accepted or popular style in a given field.

Back 41

fashion

Front 42

A fashion that enters quickly, is adopted with great zeal, peaks early, and declines very quickly.

Back 42

fad

Front 43

The product life-cycle stage in which the new product is first distributed and made available for purchase.

Back 43

introduction stage

Front 44

The product life-cycle stage in which a product’s sales start climbing quickly.

Back 44

Growth stage

Front 45

The stage in the product life cycle in which sales growth slows or levels off.

Back 45

maturity stage

Front 46

The product life-cycle stage in which a product’s sales decline.

Back 46

decline stage

Front 47

The amount of money charged for a product or service, or the sum of the values that consumers exchange for the benefits of having or using the product or service.

Back 47

price

Front 48

Charging different prices depending on individual customers and situations.

Back 48

Dynamic pricing

Front 49

Pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met.

Back 49

Target costing

Front 50

Costs that do not vary with production or sales level.

Back 50

Fixed costs

Front 51

Costs that vary directly with the level of production.

Back 51

Variable costs

Front 52

The sum of the fixed and variable costs for any given level of production.

Back 52

Total costs

Front 53

The drop in the average per-unit production cost that comes with accumulated production experience.

Back 53

Experience curve (learning curve)-

Front 54

A curve that shows the number of units the market will buy in a given time period, at different prices that might be charged.

Back 54

Demand curve

Front 55

A measure of the sensitivity of demand to changes in price.

Back 55

Price elasticity

Front 56

Adding a standard markup to the cost of the product.

Back 56

Cost-plus pricing

Front 57

Setting price to break even on the costs of making and marketing a product; or setting price to make a target profit.

Back 57

Break-even pricing (target profit pricing)-

Front 58

Setting price based on buyers’ perceptions of value rather than on the seller’s cost.

Back 58

Value-based pricing

Front 59

Offering just the right combination of quality and good service at a fair price.

Back 59

Value pricing

Front 60

Setting prices based on the prices that competitors charge for similar products.

Back 60

Competition-based pricing

Front 61

Setting a high price for a new product to skim maximum revenues layer by layer from the segments willing to pay the high price; the company makes fewer but more profitable sales.

Back 61

Market-skimming pricing

Front 62

Setting a low price for a new product in order to attract a large number of buyers and a large market share.

Back 62

Market-penetration pricing

Front 63

Setting the price steps between various products in a product line based on cost differences between the products, customer evaluations of different features, and competitors’ prices.

Back 63

Product line pricing

Front 64

The pricing of optional or accessory products along with a main product.

Back 64

Optional-product pricing

Front 65

Setting a price for products that must be used along with a main product, such as blades for a razor and film for a camera.

Back 65

Captive-product pricing

Front 66

Setting a price for by-products in order to make the main product’s price more competitive.

Back 66

By-product pricing

Front 67

Combining several products and offering the bundle at a reduced price.

Back 67

Product bundle pricing

Front 68

A straight reduction in price on purchases during a stated period of time.

Back 68

discount

Front 69

Promotional money paid by manufacturers to retailers in return for an agreement to feature the manufacturer’s products in some way.

Back 69

allowance

Front 70

Selling a product or service at two or more prices, where the difference in prices is not based on difference in costs.

Back 70

segmented pricing

Front 71

A pricing approach that considers the psychology of prices and not simply the economics; the price is used to say something about the product.

Back 71

psychological pricing

Front 72

Prices that buyers carry in their minds and refer to when they look at a given product.

Back 72

reference prices

Front 73

Temporarily pricing products below the list price, and sometimes even below cost, to increase short-run sales.

Back 73

Promotional pricing

Front 74

A geographical pricing strategy in which goods are placed free on board a carrier; the customer pays the freight from the factory to the destination.

Back 74

FOB-origin pricing

Front 75

A geographical pricing strategy in which the company charges the same price plus freight to all customers, regardless of their location.

Back 75

Uniform-delivered pricing

Front 76

A geographical pricing strategy in which the company sets up two or more zones. All customers within a zone pay the same total price; the more distant the zone, the higher the price.

Back 76

zone pricing

Front 77

A geographical pricing strategy in which the seller designates some city as a basing point and charges all customers the freight cost from that city to the customer.

Back 77

Basing-point pricing

Front 78

A geographical pricing strategy in which the seller absorbs all or port of the freight charges in order to get the desired business.

Back 78

Freight-absorption pricing

Front 79

The network made up of the company, suppliers, distributors, and ultimately customers who “partner” with each other to improve the performance of the entire system.

Back 79

Value delivery network

Front 80

A set of interdependent organizations involved in the process of making a product or service available for use or consumption by the consumer or business user.

Back 80

Marketing channel (distribution channel)-

Front 81

A layer of intermediaries that performs some work in bringing the product and its ownership closer to the final buyer.

Back 81

Channel level

Front 82

A marketing channel that has no intermediary levels.

Back 82

Direct marketing channel-

Front 83

Channel containing one or more intermediary levels.

Back 83

Indirect marketing channel

Front 84

Disagreement among marketing channel members on goals and roles-who should do what and for what rewards.

Back 84

channel conflict

Front 85

A channel consisting of one or more independent producers, wholesalers, and retailers, each a separate business seeking to maximize its own profits, even at the expense of profits for the system as a whole.

Back 85

Conventional distribution channel

Front 86

A distribution channel structure in which producers, wholesalers, and retailers act as a unified system. One channel member owns the others, has contracts with them, or has so much power that they all cooperate.

Back 86

Vertical marketing system (VMS

Front 87

A vertical marketing system that combines successive stages of production and distribution under single ownership-channel leadership is established through common ownership.

Back 87

Corporate VMS

Front 88

A vertical marketing system in which independent firms at different levels of production and distribution join together through contracts to obtain more economies or sales impact than they could achieve alone.

Back 88

Contractual VMS

Front 89

A contractual vertical marketing system in which a channel member, called a franchiser, links several stages in the production-distribution process.

Back 89

Franchise organization

Front 90

A vertical marketing system that coordinates successive stages of production and distribution, not through common ownership or contractual ties, but through the size and power of one of the parties.

Back 90

Administered VMS

Front 91

A channel arrangement in which two or more companies at one level join together to follow a new marketing opportunity.

Back 91

Horizontal marketing system

Front 92

A distribution system in which a single firm sets up two or more marketing channels to reach one or more customer segments.

Back 92

Multichannel distribution system

Front 93

The displacement of traditional resellers from a marketing channel by radically new types of intermediaries.

Back 93

Disintermediation

Front 94

Stocking the product in as many outlets as possible.

Back 94

Intensive distribution

Front 95

Giving a limited number of dealers the exclusive right to distribute the company’s products in their territories.

Back 95

Exclusive distribution

Front 96

The use of more than one, but fewer than all, of the intermediaries who are willing to carry the company’s products.

Back 96

Selective distribution

Front 97

The tasks involved in planning, implementing, and controlling the physical flow of materials, final goods, and related information from points of origin to points of consumption to meet customer requirements at a profit.

Back 97

Marketing logistics (physical distribution)

Front 98

Managing upstream and downstream value-added flows of materials, final goods, and related information among suppliers, the company, resellers, and final consumers.

Back 98

Supply chain management

Front 99

A large, highly automated warehouse designed to receive goods from various plants and suppliers, take orders, fill them efficiently, and deliver goods to customers as quickly as possible.

Back 99

Distribution center

Front 100

Combining two or more modes of transportation.

Back 100

Intermodal transportation

Front 101

The logistics concept that emphasizes teamwork, both inside the company and among all the marketing channel organizations, to maximize the performance of the entire distribution system.

Back 101

Integrated logistics management

Front 102

An independent logistics provider that performs any or all of the functions required to get its client’s product to market.

Back 102

Third-party logistics (3PL) provider

Front 103

All activities involved in selling goods or services directly to final consumers for their personal, nonbusiness use.

Back 103

retailing

Front 104

Business whose sales come primarily from retailing.

Back 104

retailer

Front 105

A retail store that carries a narrow product line with a deep assortment within that line.

Back 105

specialty store

Front 106

A retail organization that carries a wide variety of product lines-typically clothing, home furnishings, and household goods; each line is operated as a separate department managed by specialist buyers or merchandisers.

Back 106

department store

Front 107

Large, low-cost, low-margin, high-volume, self-service store that carries a wide variety of food, laundry, and household products.

Back 107

supermarket

Front 108

A small store, located near a residential area, that is open long hours seven days a week and carries a limited line of high-turnover convenience goods.

Back 108

convenience store

Front 109

A store much larger than a regular supermarket that carries a large assortment of routinely purchased food and nonfood items and offers services such as dry cleaning, post offices, photo finishing, check cashing, bill paying, lunch counters, car care, and pet care.

Back 109

superstore

Front 110

Giant specialty store that carries a very deep assortment of a particular line and is staffed by knowledgeable employees.

Back 110

category killer

Front 111

A retail institution that sells standard merchandise at lower prices by accepting lower margins and selling at higher volume.

Back 111

Discount store

Front 112

Retailer that buys at less-than-regular wholesale prices and sells at less than retail. Examples are factory outlets, independents, and warehouse clubs.

Back 112

Off-price retailer

Front 113

Off-price retailer that is either owned and run by entrepreneurs or is a division of a larger retail corporation.

Back 113

Independent off-price retailer

Front 114

Off-price retailing operation that is owned and operated by a manufacturer and that normally carries the manufacturer’s surplus, discontinued, or irregular goods.

Back 114

factory outlet

Front 115

Off-price retailer that sells a limited selection of brand-name grocery items, appliances, clothing, and a hodge-podge of other goods at deep discounts to members who pay annual membership fees.

Back 115

warehouse club

Front 116

Two or more outlets that are owned and controlled in common, have central buying and merchandising, and sell similar lines of merchandise.

Back 116

chain stores

Front 117

A contractual association between a manufacturer, wholesaler, or service organization (a franchiser) and independent businesspeople (franchisees) who buy the right to own and operate one or more units in the franchise system.

Back 117

franchise

Front 118

A group of retail businesses planned, developed, owned, and managed as a unit.

Back 118

shopping center

Front 119

A concept of retailing that states that new types of retailers usually begin as low-margin, low-price, low-status operations but later evolved into higher-priced, higher-service operations, eventually becoming like the conventional retailers they replaced.

Back 119

Wheel-of-retailing concept

Front 120

All activities involved in selling goods and services to those buying for resale or business use.

Back 120

wholesaling

Front 121

A firm engaged primarily in wholesaling activity.

Back 121

wholesaler

Front 122

Independently owned business that takes title to the merchandise it handles.

Back 122

merchant wholesaler

Front 123

A wholesaler who does not take title to goods and whose function is to bring buyers and sellers together and assist in negotiation.

Back 123

broker

Front 124

A wholesaler who represents buyers or sellers on a relatively permanent basis, performs only a few functions, and does not take title to goods.

Back 124

agent

Front 125

Wholesaling by sellers or buyers themselves rather than through independent wholesalers.

Back 125

Manufacturers’ sales branches and offices