BSNS 6350: MARKETING MANAGEMENT

USEFUL VOCABULARY, TERMS, AND CONCEPTS

MARKETING: The process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanged that satisfy individual and organizational goals.

MARKETING CONCEPT: The philosophy that the needs of the customer come first. An example of this would be an organization’s mission statement that mentions the needs of the customer in it (e.g., “We exist to meet the climate-control needs of every business office in the most efficient and effective way possible.”)

MARKETING MIX: Also known as “The Four P’s of Marketing”:

1. Product: the goods, services, and ideas that are desired/needed by individuals and provided by individuals/businesses/organizations

2. Price: the monetary value placed on products

3. Place: also known as “distribution”: all of the transactions necessary to make the product available to the consumer when and where they are willing to buy it. In a marketing sense, place can be a verb (as in “placing the product”) as much as a noun (e.g., a retail outlet)

4. Promotion: all of the activities involved in making the consumer aware of the product, giving the consumer information about the product, and persuading/influencing the consumer to buy the product. Having a unified theme for promotion activities is known as “Integrated Marketing Communications.” Promotion activities include and take place through:

a. Sales promotions—examples: contests, coupons, sponsorships, discounts, etc.

b. Direct marketing—examples: telemarketing, catalog marketing, mailbox flyers

c. Personal selling

d. Publicity and public relations

e. Internet—examples: websites, email

f. Advertising—examples: broadcast media such as t.v. and radio, print media such as newspapers and magazines, transportation media such as buses, taxis, and subways

MARKETING OBJECTIVES: Statements of what is to be accomplished through marketing activities—usually a further development of marketing goals. Example: A marketing goal may be to be the industry leader. A marketing objective may be to increase market share by 35% this year.

MARKETING ORIENTATION: The practice of putting the customer first in every functional department of the organization, at every level of the organizational hierarchy. An example of this would be putting every new employee through customer-service training.

MARKETING PLAN: A written document that acts as a guidebook of marketing activities for the marketing manager. It can also be used as part of a business plan to win support for a new business. The plan includes sections on the history of the business, a mission statement, the organizational structure, marketing goals and objectives, a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis, the marketing mix and associated strategies, a customer description/profile, and may include financial statements.

MARKET SEGMENT: A subgroup of people or organizations sharing one or more characteristics that cause them to have similar product needs, e.g. recreational tennis players (have a need for a tennis racket, tennis shoes, and tennis balls)

MARKET SEGMENTATION: The process of discovering market segments by dividing a market into meaningful, relatively similar, and identifiable segments or groups. Using the tennis player example, I may have first divided the market of physically-fit Americans capable of participating in sports into those who participate in sports and those who don’t. Then, I may have further segmented the market of those who participate in sports into those who play tennis and golf.

MARKETING STRATEGY: The activity of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges (buyer-seller) with target markets. Note that within one company or even one product line, there can be different marketing mixes for different target markets, also known as market segments. Although a “marketing strategy” can be as simple as altering one of the components in the marketing mix, some common marketing strategies are:

1. market penetration: trying to increase market share among EXISTING customers for EXISTING products (keep product the same, but may change price, place, and/or promotion)

2. market development: trying to attract NEW customers to existing products (keep product the same, but may change price, place, and/or promotion)

3. product development: create NEW product for existing customers (may change everything in the marketing mix, but may keep existing distribution channels and promotion methods)

4. diversification: increase sales by introducing NEW products into NEW markets (may completely change the marketing mix, or may keep the same distribution “place” channels)

POSITION/POSITIONING: The place (perception) the product or service holds in the mind of the customer relative to the competitors’ offerings. Companies try to “position” their products favorably, or must reposition products if the current position in the minds of the consumers is not favorable relative to the competition.

TARGET MARKET: The market segment composed of groups of people or organizations for which a business designs, implements, and maintains a marketing mix intended to meet the needs of that group, resulting in mutually satisfying exchanges. Using the market segmentation examples above, if I am thinking about opening a tennis store, my target market would be people who play tennis on a regular basis and have a disposable income that allows them to buy tennis rackets, balls, and clothing on a fairly regular basis.

UNIQUE COMPETITIVE ADVANTAGE (also called competitive distinctive): What a company does differently (and better) from the competition that gives it an edge. If this competitive advantage gives the company an advantage over its competitors for a long period of time, it is called a sustainable competitive advantage.