life-cycle costs
- The costs of a durable good over its entire operating life. Comment: Life-cycle costs are often introduced to show that products with higher initial costs (e.g., because they are built better) really have lower costs over their effective lives. (e.g., because they need fewer repairs).
logistical cost
- The costs associated with providing purchasing, manufacturing support, and physical distribution services.
logistics
- A single logic to guide the process of planning, allocating, and controlling financial and human resources committed to physical distribution, manufacturing support, and purchasing operations. The Council of Logistics Management (formerly NCPDM) offers the following definition: "Logistics management is the term describing the integration of two or more activities for the purpose of planning, implementing and controlling the efficient flow of raw materials, in-process inventory and finished goods from point of origin to point of consumption. These activities may include, but are not limited to, customer service, demand forecasting, distribution communications, inventory control, materials handling, order processing, parts and service support, plant and warehouse site selection, procurement, packaging, return goods handling, salvage and scrap disposal, traffic and transportation and warehousing and storage. "
loss leader pricing
- The featuring of items priced below cost or at relatively low prices to attract customers to the seller's place of business.
low involvement consumer behavior
- Consumer decision making in which very little cognitive activity is involved. It includes those situations in which the consumer simply does not care and is not concerned about brands or choices and makes the decision in the most cognitively miserly manner possible. Most likely, low involvement is situation-based and the degree of importance and involvement may vary with the individual and with the situation.
Maslow's need hierarchy
- A popular theory of human motivation developed by Abraham Maslow that suggests humans satisfy their needs in a sequential order beginning with physiological needs (food, water, sex), and ranging through safety needs (protection from harm), belongingness and love needs (companionship), esteem needs (prestige, respect of others), and finally, self actualization needs (self-fulfillment).
macro/micro segmentation
- A multistep, nested approach to industrial market segmentation, in which one moves from general macro criteria at the level of the organization, such as SIC code and size of the buying firm, through criteria at the level of the order or application, such as order size and urgency, to specific micro criteria at the level of the buying center, such as risk perception and attitude toward the vendor.
macromarketing
- The study of marketing processes, activities, institutions, and results from a broad perspective such as a nation, in which cultural, political, and social, as well as economic interaction are investigated. It is marketing in a larger context than any one firm.
See also: micromarketing
mall intercept
- A method of data collection in which interviewers in a shopping mall stop or intercept a sample of those passing by to ask them if they would be willing to participate in a research study; those who agree are typically taken to an interviewing facility that has been set up in the mall where the interview is conducted.
mall-type shopping center
- A grouping of stores near the center of a shopping center plot with parking area surrounding the store concentration on all sides. All or most of the stores face a mall or pedestrian shopping area.
See also: arcade shopping center, community shopping center, factory outlet center, neighborhood shopping center, off-price shopping center, regional shopping center, strip-type shopping center, super regional shopping center,
margin
- The difference between the selling price and total unit costs for an item.
marginal analysis
- A technique of explanation that focuses on the impact of producing, marketing, or consuming one more unit.
marginal cost (MC)
- The net change in total cost that results from producing and marketing one additional unit.
marginal revenue (MR)
- The net change in total revenue that results from producing and marketing one additional unit.
See also: average revenue
marginal utility
- The change in total utility due to purchasing or consuming one additional unit of a product.
See also: diminishing marginal utility and law of diminishing marginal utility
market concentration
- The degree to which relatively few firms account for a large proportion of the market such as in an oligopolistic situation. It is also known as the concentration ratio.
market demand
- The total volume of a given product or service bought by a specific group of customers in a specified market area, during a specific time period.
market evolution
- The market (or industry) life cycles describe the evolution of the market. These cycles have a similar shape to the product life cycle and similarly, have a number of distinct stages: (1) embryonic-the product class and industry definitions are virtually synonymous, diffusion rates are gradual, and there is considerable uncertainty about the product; (2) growth-the industry structure develops, the introduction of new product classes becomes easier as consumers become more knowledgeable, and the channels facilitate the marketing of new product classes established; and (3) maturity an established infrastructure facilitates rapid introduction and diffusion of new product variants or product classes, competitors jockey for position, and older products have to make adjustments to protect their declining position.
market penetration
- A growth strategy designed to enhance competitive advantage by developing low-risk improvement or revisions to the present product range. These are either proactive moves designed to identify and target changing customer requirements, or reactive moves for market defense triggered by competitive actions.
market positioning
- Positioning refers to the customer's perceptions of the place a product or brand occupies in a market segment. In some markets, a position is achieved by associating the benefits of a brand with the needs or life style of the segments. More often, positioning involves the differentiation of the company's offering from the competition by making or implying a comparison in terms of specific attributes.
market research
- The systematic gathering, recording, and analyzing of data with respect to a particular market, where market refers to a specific customer group in a specific geographic area.
market segmentation
- The process of subdividing a market into distinct subsets of customers that behave in the same way or have similar needs. Each subset may conceivably be chosen as a market target to be reached with a distinct marketing strategy. The process begins with a basis of segmentation-a product-specific factor that reflects differences in customers' requirements or responsiveness to marketing variables (possibilities are purchase behavior, usage, benefits sought, intentions, preference, or loyalty). Segment descriptors are then chosen, based on their ability to identify segments, to account for variance in the segmentation basis, and to suggest competitive strategy implications (examples of descriptors are demographics, geography, psychographics, customer size, and industry). To be of strategic value, the resulting segments must be measurable, accessible, sufficiently different to justify a meaningful variation in strategy, substantial, and durable.
market share
- 1. (geography definition) A proportion of total sales in a market obtained by a given facility or chain. 2. (strategic marketing definition) The proportion of the total quantity or dollar sales in a market that is held by each of the competitors. The market can be defined as broadly as the industry, or all substitutes, or as narrowly as a specific market segment. The choice of market depends on which level gives the best insight into competitive position.
market structure
- The pattern formed by the number, size, and distribution of buyers and sellers in a market.
marketing
- Marketing is 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 stakeholders.
marketing channel
- A set of institutions necessary to transfer the title to goods and to move goods from the point of production to the point of consumption and, as such, which consists of all the institutions and all the marketing activities in the marketing process.
marketing ethics
- 1. (legislation definition) Standards of marketing decision making based on "what is right" and "what is wrong," and emanating from our religious heritage and our traditions of social, political, and economic freedom. 2. (environments definition) The use of moral codes, values, and standards to determine whether marketing actions are good or evil, right or wrong. Often standards are based on professional or association codes of ethics.
marketing geography
- The field of study that analyzes the spatial characteristics of marketing activities: the consumers and the distribution network.
marketing intelligence system
- The development of a system to gather, process, assess, and make available marketing data and information in a format that permits marketing managers and executives to function more effectively. Marketing data, when analyzed, may yield information that can then be processed and put into a format that gives intelligence for planning, policy making, and decision purposes.
marketing management
- The process of setting marketing goals for an organization (considering internal resources and market opportunities), the planning and execution of activities to meet these goals, and measuring progress toward their achievement. Comment: The process is ongoing and repetitive (as within a planning cycle) so that the organization may continuously adapt to internal and external changes that create new problems and opportunities.
marketing manager
- The generic title for the line executive responsible for designated marketing functions (such as marketing research, product planning and market planning, pricing, distribution, the promotion mix, and customer services) and for coordinating with other departments that perform marketing related activities (such as packaging, warehousing, order filling, shipping, design of new and improved products, credit, billing, collections, accounting, legal, transportation, purchasing, product repair, warranty fulfillment, and technical assistance to customers). The marketing manager may have an officer title (such as vice president of marketing) and usually reports to the chief executive officer in a functionally organized company or to the division manager (president) in a divisionalized company. Comment: The above definition describes the marketing manager with full responsibility for marketing. However, the title is sometimes used for jobs of lesser scope; for example, in a multi-product division a manager may be in charge of a line of products or a business segment and report to the division marketing manager. Also, it is not uncommon for the sales and marketing functions to report separately to a common supervisor such as the division manager. In such a case the marketing manager may be in charge of marketing functions other than personal selling. This dichotomy most often occurs in industrial or consumer durable goods businesses in which personal selling is the key aspect of promotion.
See also: category manager, divisional organization, functional organization, group product manager, marketing of services, new product manager, non-business marketing organization, product manager, product planning manager, promotion mix,
marketing mix
- The mix of controllable marketing variables that the firm uses to pursue the desired level of sales in the target market. The most common classification of these factors is the four-factor classification called the "Four Ps"-price, product, promotion, and place (or distribution). Optimization of the marketing mix is achieved by assigning the amount of the marketing budget to be spent on each element of the marketing mix so as to maximize the total contribution to the firm. Contribution may be measured in terms of sales or profits or in terms of any other organizational goals.
marketing plan
- A document composed of an analysis of the current marketing situation, opportunities and threats analysis, marketing objectives, marketing strategy, action programs, and projected or pro-forma income (and other financial) statements. This plan may be the only statement of the strategic direction of a business, but it is more likely to apply only to a specific brand or product. In the latter situation, the marketing plan is an implementation device that is integrated within an overall strategic business plan.
See also: marketing planning
