MGMT 375 Test 3
market expansion
A strategy whose goal is growth, based on selling in areas or to groups previously not served by the business.
market penetration
A strategy whose goal is growth, based on selling more of the firm's product or service to the existing customer base.
vision statement
A very simple 5-10 word sentence or tagline that expresses the fundamental idea or goal of the firm.
informational plans
Give potential customers or suppliers information about the company and its product or service.
value proposition
Small business owners' unique selling points that will be used to differentiate their products and/or services from those of the competition.
business plan
document designed to detail the major characteristics of a firm - product or service, industry, market, operation
cognitive dissonance
doubt that occurs after a purchase has been made. an inconsistency between experience and belief
target market
group of people on which a marketer focuses promotion and sales efforts
optimum pricing
highest price that will produce your desired level of sales in your intended market
promotional mix
how much of each message conveyance you will use to sell your product as well as your objective in using each one
elasticity
idea that the market's demand for a product or service is sensitive to changes in its price
advertising
often used to support the corporate identity and value propositions that are established through public relations efforts. part of conveying your message to customers, outlets include: newspapers, magazines, billboards, tv, internet, and banners
sale leads
people who receive a promotional impression and who give some thought to buying the product
segmentation
process of dividing the market into smaller portions of people who have common characteristics
inelastic product
product for which there are few substitutes and for which a change in price makes very little difference in quantity purchased
predetermined market segments
professionally compiled target audiences based on shared demographic, financial, shopping, and psychographic characteristics
prospect
sales leads who actually make some sort of effort to learn more about the product, service, or business
target market
segment or segments selected for concentrated marketing efforts
prestige or premium pricing
setting a price above that of the competition so as to indicate a higher quality or that a product is a status symbol
skimming
setting a price at the highest level the market will bear, usually because there is no competition at the time
partitioned pricing
setting the price for a base item and then charging extra for each additional component
captive pricing
setting the price for an item relatively low and then charging much higher prices for the expendables it uses
customer retention
techniques that focus on efforts to promote satisfaction with and interest in the firm
law of supply and demand
the economic theory that describes how the demand for products or services and the supply of them affect each other
internal understanding
the extent to which employees, investors, and family members involved in the business know the business's purposes and operations
risks
the parts of a business or business plan that expose the firm to any kind of loss - profits, sales, reputation, assets, customers, and so on
price lining
the practice of setting (usually) three price points: good quality, better quality, best quality
core product
the very basic description of what a product is - a bar of soap, a house-cleaning service
elastic product
there are any number of substitutes and for which a change in price makes a difference in quantity purchased
taglines
(also known as a slogan) memorable catchphrase that captures the key ideas of a business, its services, product, or customer
most common critical risk
-overstated numbers - numbers that are wrong - inadequate cushion : not enough money to fall back on - inadequate payback - narrative and financials do not fit : plan calls for actions that are not possible with the amount of money - no direct customer connection - uncertain sales - overlooked competition - experience deficits - "what" problems - deadly aggravations : looking and sounding professional
elevator pitch
30 second/100 words or less action oriented description of a business designed to sell the idea of the business to another
bundling
combining two or more products in one unit and pricing it less than if the units were sold separately
executive summary
One- or two-page (250-500 words) overview of the business, its model, market, expectations, and immediate goals. typically put at beginning
periodic or random discounting
Sales conducted at either predictable or non-predictable intervals
odd-even pricing
Setting a price that ends in the number 5, 7, or 9.
total product
The entire bundle of products, services, and meanings of your offering; includes extras like service, warranty, or delivery, as well as what the product means to the customer.
external legitimacy
The extent to which a small business is taken for granted, accepted, or treated as viable by organizations or people outside the small business or the owner's family.
Customer Relationship Management (CRM)
The process of tracking the customer's different contacts with the firm, and using this data to help improve sales as well as the customer's experience.
marketing funnel
The rule of thumb in marketing is that it takes a large number of people to be made aware of your product in order to find a purchaser.
peak pricing
The strategy of charging a higher price during periods of high demand, and a lower price during periods of slack demand. Intended to both maximize revenue and shift excess demand to periods in which it can be more easily accommodated.
internal reference price
a consumer's mental image of what a product's price should be
new entrant business
a firm whose product or service is established elsewhere, but is new to this market
sales promotion
a form of communication that encourages the customer to act immediately, such as coupons, sales, or contest
mission statement
a paragraph that describes the firms goals and competitive advantages
product expansion
a strategy whose goal is growth, based on selling existing customer a product or service they have never bought before
markup
amount an entrepreneur adds to costs to provide a profit
margin
amount of profit, usually stated as a percentage of the total price
markup pricing
an amount is added to the cost of a product to set the retail price and provide a profit
external reference price
an estimation of what a price should be based on information external to a consumer, such as advice, advertisements, or comparison shopping
price gouging
charging an outrageously high price for something
off-peak pricing
charging lower prices at certain times to encourage customers to come during slack periods
multiple or bonus pack
combining more than one unit of the same product and pricing it lower than if each unit were sold separately
impression
what it is called when someone notices a promotional effort