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Principles of Marketing Exam 1 Vocabulary

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Marketing
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The activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large
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Exchange
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People giving up something in order to receive something else they would rather have
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Production orientation
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a philosophy that focuses on the internal capabilities of the firm rather than on the desires and needs of the market place
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Sales orientation
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the belief that people will buy more goods and services of aggressive sales techniques are used and that high sales result in high profits
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Marketing concept
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the idea that the social and economic justification for an organizations existence is the satisfaction of customer wants and needs while meeting organizational objectives
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Market orientation
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a philosophy that assumes that a sale does not depend on an aggressive sales force but rather on a customers decision to purchase a product; it is synonymous with the marketing concept
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Societal marketing orientation
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the idea that an organization exists not only to satisfy customer wants and needs and to meet organizational objectives but also to preserve or enhance individuals and societies long-term best interests
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Customer value
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the relationship between benefits and the sacrifice necessary to obtain those benefits
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Customer satisfaction
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customers evaluation of a goof or service in terms of whether it has met their needs and expectations
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Relationship marketing
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a strategy that focuses on keeping and improving relationships with current customers
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Empowerment
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delegation of authority to solve customers problems quickly – usually by the first person the customer notifies regarding a problem
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Teamwork
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collaborative efforts of people to accomplish common objectives
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Customer relationship management (CRM)
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a company wide business strategy designed to optimize profitability, revenue, and customer satisfaction by focusing on highly defined and precise customer groups
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on-demand marketing
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on-demand marketing delivers relevant experiences throughout the customers decision and buying process that are integrated across both physical and virtual environments
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Strategic planning
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The managerial process of creating and maintaining a fit between the organizations objectives and resources and the evolving market opportunities
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Strategic business unit (SBU)
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a subgroup of a single business or collection of related businesses within the larger organization
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Market penetration
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a marketing strategy that tries to increase marketshare among existing customers
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Product development
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a marketing strategy that entails the creation of new products for present markets
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Market develpoment
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a marketing strategy that entails attracting new customers to existing markets
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Diversification
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a strategy of increasing sales by introducing new products into new markets
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portfolio matrix
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a tool for allocating resources among products or strategic business units on the bases of relative market share and market growth rate
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Star
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in the portfolio matrix, a business that is fast growing market leader
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Cash cow
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in the portfolio matrix, a business unit that generates more cash than it needs to maintain its market share
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Dog
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in the portfolio matrix, a business unit that has a low growth potential and small market share
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problem child (question mark)
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in the portfolio matrix, a business unit that shows rapid growth but poor profit margins
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Planning
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the process of anticipating future events and determining strategies to achieve organizational objectives in the future
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Market planning
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designing activities relating to marketing objectives and the changing marketing environment
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Marketing plan
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a written document that acts as a guide book of marketing activities for the marketing manager
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Mission statement
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a statement of the firms business based on a careful analysis of benefits sought by present and potential customers and an analysis of existing and anticipated environmental conditions
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marketing myopia
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defining business in terms of goods and services rather than in terms of the benefits customers seek
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SWOT analysis
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identifying internal strengths and weaknesses and also examining external opportunities and threats
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Environmental scanning
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collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization and the implementation of the marketing plan
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Competitive advantage
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a set of unique features of a company and its products that are perceived by the target market as significant and superior to those of the competition
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Cost competitive advantage
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being the low-cost competitor in an industry while maintaining satisfactory profit margins
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Experience curves
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curves that show costs declining at a predictable rate as experience with a product increases
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Product/service differentiation competitive advantage
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the provision of something that is unique and valuable to buyers beyond simply offering a lower price that that of the competition
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Niche competitive advantage
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the advantage achieved when a firm seeks to target and effectively serve a small segment of the market
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Sustainable competitive advantage
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an advantage that cannot be copied by the competition
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Marketing objective
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a statement of what is to be accomplished through marketing activities
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Marketing strategy
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The activities of selecting and describing one or more target markets and developing and maintaining a marketing mix that will produce mutually satisfying exchanges with target markets
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market opportunity analysis (MOA)
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the description and estimation of the size and sales potential of market segments that are of interest to the firm and the assessment of key competitors in these market segments
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Marketing mix (four Ps)
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A unique bend of product, place(distribution), promotion, and pricing strategies designed to produce mutually satisfying exchanges with a target market
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Implementation
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The process that turns a marketing plan into action assignments and ensures that these assignments are executed in a way that accomplishes the plans objectives
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Evaluation
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Gauging the extent to which the marketing objectives have been achieved during the specified time period
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Control
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provides the mechanisms for evaluating marketing results in light of the plans objectives and for correcting actions that do not help the organization reach those objectives within budget guidelines
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Marketing audit
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a thorough systematic, periodic evaluation of the objectives, strategies, structure, and performance of the marketing organization
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Ethics
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The moral principles or values that generally govern the conduct of an individual or a group
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Deontological theory
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ethical theory that states that people should adhere to their obligations and duties when analyzing an ethical dilemma
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Utilitarian ethical theory
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ethical theory that is founded on the ability to predict the consequences of an action
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Casuist ethical theory
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ethical theory that compares a current ethical dilemma with examples of similar ethical dilemmas and their outcomes
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Moral relativsim
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an ethical theory of time– and place ethics; that is, the belief that ethical truths depend on the individuals and groups holding them
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Virtue
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a character trait valued as being good
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Morals
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the rules people develop as a result of cultural values and norms
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code of ethics
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a guideline to help marketing managers and other employees make better decisions
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Foreign corrupt practices act (FCPA)
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a law that prohibits U.S. corporations from making illegal payments to public officials of foreign governments to obtain business rights or to enhance their business dealings in those countries
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Corporate social responsibility (CSR)
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a businesses concern for societies welfare
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Stakeholder theory
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ethical theory stating that social responsibility is paying attention to the interest of every affected stakeholder in every aspect of a firms operation
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Pyramid of corporate social responsibility
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a model that suggests corporate social responsibility is composed of economic, legal, ethical, and philanthropic responsibilities and that the firms economic performance supports the entire structure
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Sustainability
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the idea that socially responsible companies will outperform their peers by focusing on the worlds social problems and viewing them as opportunities to build profits and help the world at the same time
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Green marketing
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the development and marketing of products designed to minimize negative effects on the physical environment or to improve the environment
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Cause related marketing
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the cooperative marketing efforts between a for-profit firm and a nonprofit organization
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target market
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a group of people or organizations for which an organization designs, implements, and maintains a marketing mix intended to meet the need of that group, resulting in mutually satisfying exchanges
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Environmental management
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when company implements strategies that attempt to shape the external environment within which it operates
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Component lifestyle
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the practice of choosing goods and services that meet ones diverse needs and interest rather than conforming to a single, traditional lifestyle
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Milennial
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people born between 1979 and 1994
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Generation X
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people born between 1965 and 1978
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Baby boomers
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people born between 1946 and 1964
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Purchasing power
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a comparison of income versus the relative cost of standard set of goods and services in different geographic areas
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Inflation
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a measure of the decrease in the value of money, expressed as the percentage reduction in value since the previous year
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recession
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a period of economic activity characterized by negative growth, which reduces demand for goods and services
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basic research
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Pure research that aims to confirm an existing theory or to learn more about concept of phenomenon
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Applied research
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research that attempts to develop new or improved products
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Consumer product safety commission (CPSC)
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a federal agency established to protect the health and safety of consumers in and around their homes
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Food and drug administration
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a federal agency charged with enforcing regulations against selling and distributing adulterated, misbranded, or hazardous food and drug products
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Federal trade commission (FTC)
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a federal agency empowered to prevent persons or corporations fro using unfair methods of competition in commerce
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Global marketing
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marketing that targets markets throughout the world
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Global vision
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recognizing and reacting to international marketing opportunities using effective global marketing strategies, and being aware of threats from foreign competitors in all markets
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Gross domestic product (GDP)
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the total market value of all final goods and services produced in a country for a given time period
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Outsourcing
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sending U.S. jobs abroad
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Inshoring
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returning production jobs to the U.S.
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Multinational corporation
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a company that is heavily engaged in international trade, beyond exporting and importing
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Capital intensive
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using more capital than labor in the production process
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Global marketing standardization
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production of uniform products that can be sold the same way all over the world
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Multi-domestic strategy
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when multinational firms enable individual subsidiaries to compete interdependently in domestic markets
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Mercosur
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The largest latin american trade agreement
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Uruguay round
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a trade agreement to dramatically lower trade barrier worldwide; created the WTO
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World trade organization (WTO)
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a trade organization that replaced the old general agreement on tariffs and trade (GATT)
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General agreement on tariffs and trade (GATT)
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a trade agreement that contained loopholes enabling countries to avoid trade barrier reduction agreements
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North american fair trade agreement (NAFTA)
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an agreement between Canada, U.S., and Mexico that created the worlds then largest free trade zone
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Dominican republic-Central America free trade agreement (CAFTA-DR)
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a trade agreement instituted in 2005 that include the DR and central american countries
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European union
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a free trade zone consisting of 28 countries in Europe
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World bank
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An international bank that offers low-interest loans, advice, and information to developing countries
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International monetary fund(IMF)
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an international organization that acts as a lender of last resort, providing loans to troubled nations, and also works to promote trade through financial cooperation
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Group of twenty (G-20)
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a forum of international economic development that promotes discussion between industrial and emerging -market countries on key issues related to global economic stability
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Exporting
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selling domestically produced products to buyers in other countries
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Buyer for export
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an intermediary in the global market that assumes all ownership risks and sells globally for its own support
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Licensing
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the legal process whereby a licensor allows another firm to use its manufacturing process, trademarks, patents, trade secrets, or other proprietary knowledge
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Contract manufacturing
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private label manufacturing by a foreign company
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joint venture
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when a domestic form buys part of a foreign company or joins with a foreign company to create a new entity
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Direct foreign investment
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active ownership of a foreign company or of overseas manufacturing or marketing facilities
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exchange rate
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the price of one countries currency in terms of another countries currency
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Floating exchange rates
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a system in which prices of different currencies move up and own based on the demand for and the supply of each currency
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Dumping
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the sale of an exported product at a price lower than that charged for the same or like product in the “home: market of the exporter