MGMT 470 Exam 3 (6-10)

Earned Media

- Public relations and press relations or "free ink"

Effectuation

- Putting into force or operation - A logical process in which one analyzes the resources available and restraints on the use of resources to create an attainable goal

Lean Business Practices

- Refer to systematically eliminating waste of time, materials, and money throughout a business - Addresses the specifics of internet based businesses where rapid experimentation and constant monitoring of viewers' choices are possible

Brand Ambassadors

- Related affiliates to paid and owned media

Primary Research

- Research gathered to answer a specific marketing question

Buyouts

- Restricted to businesses that have a formal legal form of organization - Accomplished through purchasing ownership interest - Very simple - Occurs through an employee stock ownership plan (ESOP)

Product Distribution Franchising

- Sell the franchisor's products and are supplier-dealer relationships - The franchisor licenses its trademark and logo to the franchisees but typically does not provide them with an entire system for running their business

Core Competencies

- Skills all competitors have

Key Performance Indicators

- Standards for measuring goals

Altruism

- The belief in or practice of disinterested and selfless concern for the well-being of others

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

Industry

- The general name for the line of product or service being sold

Strategy

- The idea and actions that explain how a firm will make its profit

Prototype

- The name given to a first product or service - Used in further consumer testing

Book Value

- The original acquisition cost of the asset minus all the depreciation expense recognized to date

Competitive Advantage

- The particular way a firm implements customer benefits that keep the firm ahead of other firms in the industry

Break Even

- The point at which cost and income is equal

Bricolage

- The process of analyzing the resources available and creating a product or service from them

Due Diligence

- The process of investigating a business to determine its value and possible implications

Business Life Cycle

- The progression of business phases over time

Scope

- The range of something

Earnings Multiple

- The ratio of the value of a firm to its annual earnings - The firm value divided by actual or expected annual earnings Provides a quick estimate of firm value

Churn

- The rotation of customers

Takeover

- The seizing of control of a business by purchasing its stock to be able to select the board of directors

Global Mindset

- The set of individual qualities, communication skills, and actionable knowledge that empowers those in leadership roles to influence multicultural individuals, groups, and organizations

Scale

- The size of the market, mass, or niche

Cognitive Dissonance

- The state of having inconsistent thoughts, beliefs, or attitudes, especially as relating to behavioral decisions and attitude change

Intangibles

- Unable to be touched or grasped

Bootsrapping

- Using low cost or free techniques to minimize your cost of doing business

Blue Ocean Strategy

- When a new product or service is introduced - (pure innovation)

Paid Media

- When you pay for an advertisement

Owned Media

- Your website, newsletters, emails, signage, etc

Key Resource Acquisitions

- (bulk asset purchases) - The only way a sole proprietorship can be purchased - Purchasing only the assets of the business - Difficult to value intangible assets he buyer is not responsible for any acts of the prior owner - The seller keeps cash and recievables

Elevator Pitch

- A 30 second action-oriented description of a business designed to sell the idea of the business to another - Should be memorable enough so that the listener can tell others about your business

Spin - off

- A business that is created by separating part of an operating business into a separate entity - Done by businesses of all sizes and different stages of development

Pivot

- A change of direction in the thinking of an entrepreneur or a firm often based on new data or other findings

Competitive Advantage

- A condition or circumstance that puts a company in a favorable or superior business position

Co Marketing

- A form of automated marketing in which an electronic storefront has formed a partnership with another electronic storefront in which each company markets the other's online products

Cost Strategy

- A generic strategy aimed at mass markets in which a firm offers a combination of cost benefits that appeal to the customer

Focus Strategy

- A generic strategy that targets a portion of the market called a segment or niche

Mission Statement

- A paragraph that describes the firm's goals and competitive advantages

Differentiation Strategy

- A type of generic strategy aimed at clarifying how one product is unlike another in a mass market

Vision Statement

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

Industry Analysis

- Allows entrepreneurs to see how profits are generated which tells if an industry is growing, stable, or in decline

Secondary Research

- An approach to researching based on the use of existing information

Trade Name Franchising

- An arrangement in which there is a supplier who supplies a product or product family to any dealer who could also avail the identity of the supplier - Also known as a product franchise

Replacement Value

- An estimate of what an identical asset would cost to be acquired and readied for service

Tangibility

- An item's capability of being touched, seen, tasted, or felt

Entry Wedge

- An opportunity that makes it possible for a new business to gain a foothold in the market - Supply shortages, unutilized resources, customer contracting, second sourcing, market relinquishment, favored purchasing, and government rules

Retrenchment

- An organizational life cycle stage in which established firms must find new approaches to improve the business and its chances for survival

Mass Market

- Broad market

Synergy

- Business results are greater than the sum of the input - A combination in which the whole is greater than the sum of its component parts

Shared Media

- Called work of mouth or referral advertising

Heuristics

- Common rules of thumb that are used to estimate firm value in relation to some easily observable characteristics of the business

Comparable Sales

- Commonly used to estimate the value of a business - A problem because no two firms are exactly alike and there are often no recent sales for comparison

First Step of Due Diligence

- Conduct extensive interviews with the sellers of the business

Augmented Product

- Core product plus features that differentiate it from competition

Value Proposition

- Focused on by marketing - The relation of product or company capabilities to customer pains and gains

Business Format Franchising

- Granting of a license by one person (the franchisor) to another (the franchisee)

Distinctive Competence

- How your firm differs from another

Incremental Innovation

- Imitation plus one degree of similarity

Operational Plans

- Include the full business plan but add details on major techniques, methods, recipes, formulas, and sources

Primary Goal of Due Diligence

- Look for any wrongdoing, fraud, misrepresentations, or missing information - Look for inefficiencies, waste, opportunities, or mismanagement

Operating Margins

- Measures how much profit a company makes on a dollar of sales after paying for variable costs of production

Niche Market

- Narrowly defined market

Sole Proprietorship

- One owner who personally pays income tax on profit earned