Business Terms and Explanations

• Value: the benefits a customer receives from buying a good or service

• Marketing is a fundamental part of our lives both as consumers and as players in the business world

• A marketer’s decisions affect—and are affected by—the firm’s other operations and departments

• Marketing: an organizational function and a set of processes for creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stake holders

• Marketing is all about delivering value to everyone who is affected by a transaction

• Stakeholders: buyers, sellers, or investors in a company, community residents, and even citizens of the nations where goods and services are make or sold—in other words, any person or organization that has a “stake” in the outcome

• Consumer: the ultimate user of a good or service

• Marketing concept: a management orientation that focuses on identifying and satisfying consumer needs to ensure the organization’s long term profitability

• Need: the recognition of any difference between a consumer’s actual state and some ideal or desired state

• Want: the desire to satisfy needs in specific ways that are culturally and socially influenced

• Benefit: the outcome sought by a customer that motivates buying behavior—that satisfies a need or want

• Market: all the customers and potential customers who share a common need that can be satisfied by a specific product, who are the resources to exchange for it, who are willing to make the exchange, and who have the authority to make the exchange

• Marketplace: any location or medium used to conduct any exchange

• Virtual goods: digital products consumers buy for use in online contexts

• Utility: the usefulness or benefit consumers receive from a product; creates value

• Form utility: the benefit marketing provides by transforming raw materials into finished products ex) when a dress manufacturer combines silk, thread, and zippers to create a bride’s gown

• Place utility: the benefit marketing provides by making products available where customers want them

• Time utility: the benefit marketing provides by storing products until they are needed

• Possession utility: the benefit marketing provides by allowing the consumer to own, use, and enjoy the product

• Exchange: the process by which some transfer of value occurs between a buyer and a seller

• Product: a tangible good, service, idea, or some combination of these that satisfies consumer or business customer needs through the exchange process; a bundle of attributes including features, function, benefits, and uses—whatever is offered for sale in the exchange

• Production orientation: a management philosophy that emphasizes the most efficient ways to produce and distribute products

• Firms that focus on production orientation tend to view the market as a homogeneous group that will be satisfied with the basic function of a product

• Selling orientation: a managerial view of marketing as a sales function, or a way to move products out of warehouses to reduce inventory

• Tend to me more successful at making one time sales rather than at building repeat business

• Consumer orientation: a business approach that prioritizes the satisfaction of customers’ needs and wants

• Total Quality Management(TQM): a management philosophy that focuses on satisfying customers through empowering employees to be active part of continuous quality improvement

• Instapreneur: a businessperson who only produces a product when it is ordered

• Just in time

• On demand

• Triple bottom line orientation: a business orientation that looks at financial profits, the community in which the organization operates, and creating sustainable business practices—building long term relationships with customers rather than just selling them stuff

1. the financial bottom line: financial profits to stakeholders

2. the social bottom line: contributing to the communities in which the company operates

3. the environmental bottom line: creating sustainable business practices that minimize damage to the environment or that even improve it

• customer relationship management(CRM): a systematic tracking of consumer’s preferences and behaviors over time in order to tailor the value proposition as closely as possible to each individual’s unique wants and needs. CRM allows firms to talk to individual customers and to adjust elements of their marketing programs in light of how each customer reacts

• attention ceremony: a company’s success is measured by its share of mind rather than share of market, where companies make money when they attract eyeballs rather than just dollars

• social marketing concept: a management philosophy that marketers must satisfy customers’ needs in ways that also benefit society and also deliver profit to the firm

• sustainability: a product design focus that seeks to create products that meet present consumer needs without compromising the ability of future generations to meet their needs

• AKA cradle to cradle

• Green marketing: a marketing strategy that supports environmental stewardship, thus creating a differential benefit in the minds of consumers

• Internet is the most popular medium for green marketing

• Return on investment(ROI): the direct financial impact of a firm’s expenditure of a resources such as time or money

• Popular culture: the music, movies, sports, books, celebrities, and other forms of entertainment consumed by the mass market

• Ex) tv dinner signaled change in family structures, condoms marketed in pastel colors intended for female buyers signaled changing attitudes toward sexual responsibility