Term
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Definition
| The money or other considerations exchanged for the ownership of use of a product |
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Term
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Definition
| 1) Attempts to match or beat competitors prices 2) Firm should be low cost producers 3) For standardized products 4) May change prices frequently |
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Term
| Differentiation marketing |
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Definition
| Marketer emphasizes factors other that the price to distinguish the product. Builds customer loyalty. Company must be able to distinguish brand with features difficult to copy by competitors. |
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Term
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Definition
| Profit, Market Share, ROI, cash flow, status quo, survival |
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Term
| What makes a demand curve elastic/inelastic |
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Definition
| Unique product, substitute awareness effect, Difficult comparison test, price-quality effect, inventory effect, sunk investment effect, end benefit effect (expenditure to total cost), shared cost effect, Total expenditure effect (expenditure to total income) |
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Term
| Substitute awareness effect |
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Definition
| if people are unaware of a substitute for a product, that product becomes more inelastic. |
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Term
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Definition
| if people think that a product is of high quality, they are willing to pay a higher price for that product. |
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Term
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Definition
| If people can store a product, they will be more price sensitive. |
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Definition
| eg Gillete Razors and their blades, electric toothbrushes and heads, or printers and cartridges. |
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Term
| End Benefit effect (expenditure to total cost) |
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Definition
| If an expenditure is relatively small as compared to the total cost of a purchase, people will be less price sensitive. |
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Term
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Definition
| When people share costs, they are less price sensitive |
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Term
| Total Expenditure Effect (expenditure to total income) |
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Definition
| If an expenditure is relatively low as compared to total income, people will be less price sensitive. |
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Term
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Definition
-based on the level of demand for a product
-high price when demand is high and low price when demand is weak. |
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Term
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Definition
| Adding a dollar amount or % to cost of product |
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Term
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Definition
| total coast and adding specific amount (dollar or %) to cost. Usually used for business products (eg goverment) because hard to predict cost. |
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Term
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Definition
| adding a fixed % to cost. markup as % of cost or markup as % of sale price |
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Term
| Competition Based Pricing |
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Definition
| Price is influenced more by competitors prices than by costs and revenue. Can choose the price, below, above or at same level as competitors. Helps firms acheive objectives of increasing sales or market share. |
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Term
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Definition
| Talk to customers to find out what price can be charged. You then work backward to find out what the product has to cost to allow the company to make an acceptable margin. The company then works with suppliers to reach appropriate target costs to keep components within an overall cost budget. |
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Term
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Definition
| new product pricing, product mix pricing, promotional pricing, discriminatory pricing, and psychological pricing. |
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Term
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Definition
| Skimming and penetration pricing |
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Term
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Definition
| set the highest initial price that customers desiring the product are willing to pay |
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Term
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Definition
| set a low initial price to appeal immediately to the mass market |
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Term
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Definition
| Product Line Pricing, Optional Feature Pricing, Captive Product pricing, product bundling pricing. |
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Term
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Definition
| Loss leader pricing, special even pricing, cash refund rebate, low interest financing |
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Term
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Definition
| charge less for one item to increase store traffic |
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Term
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Definition
| Flexible Price Policy, customer segment pricing, location pricing, time pricing |
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Term
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Definition
| setting different prices for products instead of setting one price for all buyers |
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Term
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Definition
| done to shift demand and level it out. eg movie theater pricing. |
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Term
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Definition
| giving different prices to different segments. eg senior discounts or business discounts |
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Term
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Definition
| Charging different prices at different locations. eg an airport McDonald's |
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Term
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Definition
| Influence customer's perception of price. Includes: Multi-unit pricing, EDLP, odd-even pricing, prestige pricing. |
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Term
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Definition
| selling two or more units for a single price |
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Term
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Definition
| odd price = sale, even price = upscale |
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Term
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Definition
| high price to give quality image |
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Term
| Discounts and Allowance for Business Markets |
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Definition
| trade (functional) discounts, quality discounts, cash discounts, seasonal discounts, trade-in allowances, promotional allowance, geographical pricing. |
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Term
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Definition
| Price of merchandise at the factory, before shipment |
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Term
| Uniform Geographic Pricing |
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Definition
| Charging the same price regardless of geographical location |
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Term
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Definition
| Pricing based on transportation costs within major geographical zones |
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Term
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Definition
| pricing that combine factory price and freight charges from the base point nearest the buyer |
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Term
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Definition
| producer absorbs the cost of shipping |
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Term
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Definition
| What happens to costs and revenues when production or sales volume is changed by one unit. Marginal Cost and marginal revenue |
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Term
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Definition
| point at which costs of producing a product equals the revenue made from selling the product. |
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Term
| Problems with decreasing prices |
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Definition
| Low quality trap, fragile market share trap (you don't get brand loyal people, you only borrow market share), shallow pocket trap. |
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Term
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Definition
| Develop an overall strategy for long run survival and growth |
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Term
| Why form a strategic plan? |
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Definition
| Make management think systematically, better coordination of company effort, set goals and objectives to shoot for, set performance standards (benchmarks) |
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Term
| Strategic Planning Process |
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Definition
| Define a Mission, set company goals and objectives, define a corporate strategy, define a strategic business units (SBU) strategy, plan a marketing strategy. |
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Term
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Definition
| A broad description of the firm's objectives and the scope of activities it plans to undertake. It is a guideline for organization's decision making for short and long run. It provides common understanding of the organization's purpose. It establishes general boundaries for activities and should be market oriented. |
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Term
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Definition
| Supporting goals and objectives to guide the company (benchmarks). They measure how well the organization's mission is being accomplished. |
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Term
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Definition
| The overall plan that integrates the strategies of all the businesses within the corporation. |
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Term
| Strategic Business Unit (SBU) |
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Definition
| A profit center that is self supporting in terms of sales, markets, production, and other resources. Could be a company division, a product line, or sometimes a single product or brand. |
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Term
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Definition
| Tool by which management identifies and evaluates the various businesses that make up the company. BCG Matrix, and GE Matrix. |
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Term
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Definition
| vertical axis-annualized rate at which the various markets are growing (industry attractiveness) horizontal axis-market share relative to largest competitor (business strength). |
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Term
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Definition
| high growth market, dominant market share. Requires additional resources for continued growth. |
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Term
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Definition
| Low growth, dominant market share. Generates surplus resources for allocation to other SBU's. |
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Term
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Definition
| Low/declining market, subordinate market share. Has diminishing prospects and represents a drain on the profits. |
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Term
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Definition
| High growth market, low market share. Represents a high risk/cost opportunity requiring a large commitment of resources to build market share. |
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Term
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Definition
| growth occurring when current products and/or current markets have the potential for increasing sales. Market penetration, market development, product development |
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Term
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Definition
| An intensive growth strategy that has a Present market, present product |
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Term
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Definition
| An intensive growth strategy that has a New Market, present product |
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Term
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Definition
| An intensive growth strategy that has a Present Market, New Product |
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Term
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Definition
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Term
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Definition
| Retain product, retain market, but resources are diminished |
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Term
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Definition
| Eliminate Product, Retain Market |
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Term
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Definition
| Retain Product, Eliminate Markets |
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Term
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Definition
| Eliminate Product, Eliminate Markets |
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Term
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Definition
| Developing Schedules, Executing Marketing Program |
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Term
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Definition
| Comparing results with plans to identify deviations (what is happening and why is it happening?). Acting on Deviations (Exploit a positive difference, correct a negative deviation. |
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Term
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Definition
| The activities performed across national boundaries. Concepts are the same, planning and control of marketing activities can differ due to difference in environment (context) |
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Term
| Decisions in International Marketing |
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Definition
| Assess the global marketing environment. Deciding whether to go international. Decide which markets to enter. Decide on global marketing program. |
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Term
| International Trade System (Various Trade Restrictions) |
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Definition
| tariff, non-tariff trade barriers, quota, embargo, exchange rate, soft currency (values of currency fluctuates often) |
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Term
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Definition
| direct exchange for goods |
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Term
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Definition
| Receive some % in cash and rest in product |
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Term
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Definition
| seller sells plant, equipment or technology and agrees to accept as partial payment products manufactured with the equipment supplied. |
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Term
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Definition
| Seller receives full payment in cash but agrees to spend substantial amount of money in that country within a stated period of time. |
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Term
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Definition
| Free trade zones (NAFTA, EU) |
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Term
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Definition
| A subsistence economy is an economy in which a group attempts to produce no more output per period than they must consume in that period in order to survive, but do not attempt to accumulate wealth or to transfer productivity from one period to the next. |
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Term
| Industrializing Economies |
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Definition
| Country formerly classified as less developed, but which is becoming rapidly industrialized. The first wave of countries to be identified as newly industrializing included Hong Kong, South Korea, Singapore, and Taiwan. China, Russia and India would be now classified as such. |
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Term
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Definition
| eg US, Japan, Germany, Korea etc. |
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Term
| Political/Legal Environment |
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Definition
| Attitude towards international buying, government bureaucracy, political stability. |
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Term
| Global Marketing Entry Strategies |
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Definition
| Exporting (direct and indirect), licensing (franchising), Joint Venture, Direct Investment. |
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Term
| Profit Potential for global market entry strategies |
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Definition
| 1)Direct Investment 2)Joint Venture 3)Licensing 4)Exporting |
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Term
| Financial Commitment and risk for global market entry strategies. |
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Definition
| 1)Direct Investment 2)Joint Venture 3)Licensing 4)Exporting |
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Term
| Type of Marketing Strategy for a International Firm |
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Definition
| Standardized extension of home country marketing strategy |
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Term
| Type of Marketing Strategy for a Multinational Firm |
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Definition
| Customized multidomestic marketing strategy |
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Term
| Type of Marketing Strategy for a transnational firm |
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Definition
| flexible standardization, global Marketing Strategy |
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Term
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Definition
| a firm sells a product in a foreign country below its domestic price or below its actual cost. |
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Term
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Definition
| situation where products are sold through unauthorized channels of distribution. Also called parallel importing. |
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Term
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Definition
| Pricing of goods and services that are sold to controlled entities of the same organization. |
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