MGMT350 Test 3

purchaser

A customer role that describes an individual or institution that pays for or obtains a product or service.

customer profile

A detailed description of an archetypical or hypothetical potential customer for a product or service, also called a customer persona.

markup

the amount an entrepreneur adds to costs to provide a profit

margin

the amount of profit, usually stated as a percentage of the total price

core product

the basic description of what a product is - a bar of soap, a housecleaning service

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

manufacturer

the entity that produces a product or service to be sold

internal understanding

the extent to which employees, investors, and family members involved in the business know the business's purposes and operations

optimum price

the highest price that will produce your desired level of sales in your intended market

outstanding customer service

the idea of "going all out" for the customer or providing over-the-top service, not just the basic help, professionalism, and friendliness we all expect in any business transaction

prototype

the name given to the first model of a product or service

pivot

typically, a term describing a change of direction in the thinking of an entrepreneur or a firm, often based on new data or other findings

long-term value

a marketing concept that refers to the revenue (or profit) generated by one customer over his or her lifetime dealing with one firm

direct mail

a method of selling in which catalogs, brochures, letters, videos, and other pieces of marketing materials are mailed directly to customers from which they can mail in, call in, or email an order

executive summary

a one to two (250-500 words) overview of the business, its business model, market, expectations, and immediate goals

cover letter

a one-page document on business stationary that introduces the business plan and the business owner to the recipient and indicates why the recipient is being asked to read the plan

mission statement

a paragraph that describes the firm's goals and competitive advantages

scalar question

a question answered by some sort of scale - "on a scale of 1-5...?"

Manufactuer's Suggested Retail Price (MSRP)

a target price set by a manufacturer for a product or service intended to provide profit for each intermediary in the distribution channel

screening plan

also called a mini-plan, gives the basic overview of the firm and a detailed look at the financials

proof-of-concept website

an Internet-based type of business plan providing information or demonstration of a product or services designed to solicit information on customer interest

primary research

an approach to researching based on the gathering of new information, using techniques such as interviewing, surveying, and observation

secondary research

an approach to researching based on the use of existing information, often from government, commercial, or academic databases and research efforts

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

data room

an online repository (dropbox) for the documentation that back ups and details the specifics of your business and business plan. The contents are very similar to those of the three-ring binder personal edition of the plan held and used by the founder

test marketing

selling your product or service in a limited area, for a limited time

premium pricing

setting a price above that of the competition to indicate a higher quality

prestige pricing

setting a price above that of the competition to indicate your 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

odd-even pricing

setting a price that ends in the number 5, 7, 9

elevator pitch

30 second/100 words or less action oriented description to create "hook"

serviceable obtainable market (SOM)

A marketing term (also called the target market) that represents the customers that a firm expects to be interested in its particular product or service, and able to be serviced by the firm.

penetrated market (PM)

A marketing term that describes the actual number of customers of an operating firm, divided by the size of the target market, which gives a percentage of the market the firm (or product/service) has attained so far.

total available market (TAM)

A marketing term that refers to all of the people or organizations (in one nation, region, or the world) who might consider a product or service being offered.

serviceable available market (SAM)

A marketing term that refers to the customers within the geographic reach of a firm.

vision statement

A very simple 5-10 word sentence or tagline that expresses the fundamental idea or goal of the firm.

tagline

Memorable catchphrase that captures the key idea of a business, its service, product, or customer. also known as a slogan

direct sales

Methods of going directly to your customer in order to sell your product. Vending machines, door-to-door salespeople, leasing space at a craft fair, farmers markets, party sales, and most industrial sales are methods of direct selling

channels

People and firms who connect producers of goods and services with customers

marketing research

Systematic collection and interpretation of data to support future marketing decisions

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.

purchasing process

The sequence of steps an individual or organization goes through in making a decision to buy a product or service.

operational plan

a business plan designed to be used internally for management purposes

informational plan

a business plan that gives potential customers or suppliers information about the company and its product or service

key employee/partner plan

a business plan that provides information on the company, product/service, market, and critical risks to prospective business or marketing partners or to prospective key employees

internal reference price

a consumer's mental image of what a product's price should be based on experience and the consumer's estimate of what the comparative value might be

influencer

a customer role describing a person or group who can make credible or recognized suggestions or recommendations to others regarding purchase choices

decision marker

a customer role that describes a person in an organization who is responsible for choosing which product or service will be obtained

survey

a data-collection method using a questionnaire - in person, on phone, on paper, or on the Internet

referral discount

a discount given to a customer who refers a friend to the business

business plan

a document designed to detail the major characteristics of a firm - its product or service, its industry, its market, its manner of operating (production, marketing, management), and its financial outcomes on the firms present and future

new entrant business

a firm whose product or service is established elsewhere, but is new to this market

pioneering business

a firm whose product or service is new to the industry or is itself creating a new industry

invention plan

business plan that provides information to potential licensees. Focuses on the details of an invention, including intellectual property rights

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

bundling

combining two or more products in one unit and pricing it less than if the units were sold separately

telemarketing

contact via telephone for the express purpose of selling a product or service

augmented product

core product plus features that tend to differentiate it from the competition

end user

customer role that describes the person who eventually makes actual use of a product or service in his or her personal or work life

elasticity

from economics, the idea that the market's demand for a product or service is sensitive to changes in its price

preselling

involves introducing your future product to potential customers and taking orders for later delivery

elastic product

product for which there are any number of substitutes and for which a change in price makes a difference in quantity purchased

inelastic product

product for which there are few substitutes and for which a change in price makes very little difference in quantity purchased

me-too products

products essentially similar to something already on the market

periodic discounting

sales conducted at predictable intervals, such as before major holidays

mail order

sales made from ads in newspapers or magazines, with purchases taken online or by phone as well as by mail

pitch

the name given to the formal presentation of a slideshow summarizing your business plan given before judges or potential investors or partners

pitch deck

the name of a slideshow presentation that summarizes a business or more often a business plan

research and development (R&D)

the part of a business (and a business plan) that is focused on creating new products or services and preparing new technologies, ideas, products, or services for the firm's market

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

just-in-time inventory

the practice of purchasing and accepting delivery of inventory only after it has been sold to the final customer

pricing lining

the practice of setting (usually) three price points, good quality, better quality, best quality

product development process

the procedure to organize and pursue the creation of new goods or services

customer development process

the procedure to organize and pursue the finding, obtaining, and keeping of new customers

due diligence

the process of investigating a business to determine its value and potential for investment

commercialization

the process of making the new products ready for use by consumers by achieving standards of durability and performance suitable for the market and comparable to the competition

fulfillment center

A company that will warehouse your products and fill your customers' orders for you.

budget cycle

A term applied to the schedule and the process for setting the schedule for making purchases by an individual or an organization

co-working space

A type of "incubator lite" offering low-cost shared space and basic business services (Wi-Fi, desks, coffee, conference room, copier, etc.) for a daily, weekly, or monthly rental fee.

wholesaler

An intermediary that sells products to other organizations such as retailers, manufacturers, and hospitals.

indirect exporting

Exporting using intermediaries such as agents, export management companies, or export trading companies.

direct exporting

Exporting using no intermediaries

freight forwarders

Firms specializing in arranging international shipments-packaging, transportation, and paperwork

direct response advertising

Placing an advertisement in a magazine or newspaper, on television or radio, or in any other media. The ad contains an order blank with a phone number and e-mail or regular mail address with the intent of having the customer place an immediate order

letter of credit

a document issues by a bank that guarantees a buyer's payment for a specified period of time upon compliance with specified terms

documentary draft

a draft that can be exercised only when presented with specified shipping documents

sales promotion

a form of communication that encourages the customer to act immediately, such as coupons, sales, or contests

focus group

a form of data gathering from a small group led by a moderator

born international

a new firm that opens a website immediately, thus being exposed to customers from around the world

sheltered workshop

a nonprofit organization or institution that provides business services by using handicapped or rehabilitated workers

markup pricing

a price-setting method where an amount is added to the cost of a product to set the retail price and provide a profit

proprietary technology

a product or service or an aspect of one that is kept as a trade secret or is protected legally using patent, copyright, trademark, or service mark

heterogeneity

a quality of a service in which each time it is provided it will be slightly different from the previous time

inseperability

a quality of a service in which the service being done cannot be disconnected from the provider of the service

open-ended question

a question that allows respondents to express themselves as they choose

dichotomous question

a question that has only two possible choices - "yes" or "no"

categorical question

a question that is answered by selecting the proper category - "what is your ethnicity?"

random discounting

a sale run on a schedule that is unpredictable to the customer

signature block

a snippet of text, typically inserted at the bottom of an email, that contains contact information for the sender of the email

private placement memorandum (PPM)

a specialized legal form of business plan crafted by lawyers for the purpose of soliciting formal investments

e-tailer

an electronic retailer; a store that exists only on the internet.

contract manufacturing

an existing firm with the correct manufacturing capabilities makes your product for you

agent

an intermediary business that represents a manufacture's product or service to other business-to-business intermediary firms

retailer

an intermediary business that sells to consumers or end users of a product

accelerator

an organization that supports start-ups, typically of a particular type (Internet, biotech, fashion, sports) with a financial investment, free or inexpensive office space, mentoring, a variety of free or low-cost support services, and other resources

ethnographic research

data gathered by simple observation - seeing what consumers do, rather than asking them

traffic generators

other businesses that bring customers to the area

direct marketing

selling your goods or services to consumers without intermediaries, typically to select customer groups and typically with tracking of the results

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

value proposition

small business owners' unique selling points (benefits) that customers can expect from your goods or services, including benefits that differentiate your offering from those of the competition

working capital

the cash immediately available to the firm for the day-to-day expenses and operations of the firm

microinventory

the purchase of inventory only after a sales is made; very typical with Internet firms

customer job

the term given to what a potential customer is trying to do - perform or complete some sort of task, solve some problem, or try to achieve some outcome.

guerrilla marketing

the use of creative and relatively inexpensive ways to reach your customers (doorknob hangers, flyers under windshield wipers, T-shirts, balloons)

multichannel marketing

the use of several different channels to reach your customers, for example, a website, direct mail, and traditional retailing