Glossary Flashcards
(219 cards)
1
Q
Goods
A
Is a tangible product that can be seen or taken home e.g. iPhone.
2
Q
Service
A
Is an intangible product that the consumer does not physically take home e.g. yoga classes.
3
Q
Brick and Mortar Business
A
Selling a physical product in a physical store.
4
Q
International Online Media Empire
A
Running a multi-pronged business that brings in revenue and operates across multiple platforms.
5
Q
Land (Physical Input)
A
These are natural resources needed to produce goods and services.
6
Q
Labour (Human Input)
A
This refers to human effort used to produce goods and services.
7
Q
Capital (Physical Input)
A
This refers to non-natural (or man-made) resources used in the production process.
8
Q
Entrepreneurship (Enterprise & Human Inputs)
A
This refers to the knowledge, skills and experiences of individuals who have the capability to manage the overall production process. Entrepreneurs have the ability and willingness to take risks in order to produce goods and provide services to customers, profitably.
9
Q
Adding Value
A
The practice of producing a good or service that is worth more than the cost of the resources used in the production process (e.g. production: 1.50, price: 2.50).
10
Q
Value Added
A
The difference between the production cost and selling price. (E.g. production cost: 1.50, selling price: 2.50, value added: 1).
11
Q
Needs
A
The basic necessities that a person must have to survive, including food, water, warmth, shelter and clothing.
12
Q
Wants
A
People’s desires, e.g. the things they would like to have, such as new clothes, smartphones, overseas holidays and jewellery.
13
Q
Consumers
A
Are the people or organisations that actually use/consume a product.
14
Q
Customers
A
Are the people or organisations that buy the product.
Note: Customers can also be the consumers OR the consumers can be different from the customers. E.g. A company buys multiple work laptops (customer), their employees use these work laptops daily (consumers).
15
Q
Consumer Goods
A
Are products sold to the general public; durable and non-durable.
16
Q
Capital Goods
A
Are physical products bought by businesses to produce other goods and/or services.
17
Q
Primary Sector (Goods)
A
Involves acquiring raw materials. For example, metals and coal have to be mined, oil drilled from the ground, fruits farmed and animals raised.
18
Q
Secondary Sector (Goods)
A
Manufactures and assembles products. They transform raw materials into finished goods. For example, cookies, cars, cell phones, etc.
19
Q
Tertiary Sector (Services)
A
Provides services to customers, which sometimes includes tangible goods. Examples include banks, education, transportation, insurance, etc.
20
Q
Quaternary Sector (Services)
A
Provides services that are focused on knowledge. This includes IT, research and development, consultancy, the media, etc.
21
Q
Entrepreneur
A
An individual who develops and runs a business, assuming all the risks and rewards of that given business.
22
Q
Change
A
The modification or transformation in the way business is conducted as a response to internal factors or external influences.
23
Q
Ethics
A
The moral principles and values that form the basis of how business activity is conducted.
24
Q
Creativity
A
Generating new ideas. The ability to create, design, or produce a new idea.
25
Sustainability
Meeting the needs of the present without compromising the ability of future generations to meet their own needs.
26
Private Sector
Businesses owned and run by private individuals and organisations that usually, but not always, aim to earn a profit are part of the private sector. They operate independently from the government, although they need to operate within the rules and regulations in the country.
27
Public Sector
Public sector business organisations are controlled by a regional and/or national government. Their main aim is to provide essential goods and services for the general public. Such businesses can, but do not always, directly charge customers for such services. In some cases, such as government housing or state-funded education, the service is provided and/or funded by the government.
28
Limited Liability
Investors can only lose the money they invested but not personal property or money (hybrid entities that combine the characteristics of a corporation with those of a partnership or sole proprietorship have limited liability).
29
Unlimited Liability
Investors can lose their personal property and money to help pay the debts of the company (involves general partners and sole proprietors who are equally responsible for all debt and liabilities accrued by the business).
30
Privately Held Corporation
Owned by shareholders however shares are not advertised or traded on stock exchange. The number of shareholders is limited.
31
Publicly Held Corporation
Owned by shareholders however shares are advertised or traded on stock exchange. The number of shareholders is unlimited.
32
For-profit Company
Operates with the goal of making money.
33
Non-profit Company
Operates with the primary objective of benefiting the society as a whole (and making some profit to invest into the business).
34
Cooperatives
An association of persons (organisation) that is owned and controlled by the people to meet their common economic, social, and/or cultural needs and aspirations.
35
Company
A legal entity formed by a group of individuals to engage in and operate a business—commercial or industrial—enterprise.
36
Incorporation
When a business is registered with a state so that it becomes a separate legal entity.
37
Initial Public Offering
The first time a company sells shares publicly.
38
Stock Exchange
A marketplace where securities, such as stocks and bonds, are bought and sold.
39
Social Enterprises
Business with specific social objectives that serve its primary purpose.
40
Non-government Organisations (NGO)
A non-profit, private organisation that operates outside of government control.
41
Business Ownership
The legal structure that a business chooses to operate with (it is a crucial element).
42
Sole Trader
Self employed or sole proprietor (any business that is owned and controlled by one person). Ex. plumbers, hairdressers, photographers (typically for skilled specialists). Legally there is no distinction between a business owner’s personal and professional assets (unlimited liability).
43
Partnership
A business legally owned by two or more people. Ex. Trades people, dentists, solicitors (skilled and professional). Requires a partnership agreement which covers key legal issues such as how management decisions are made and how profits are shared. UNLIMITED LIABILITY
44
Limited Partneship
Just like a normal partnership apart from the fact it limits personal liability for SOME partners.
45
Limited Liability Partnership
Same as normal partnership but instead ALL partners have limited liability.
46
Private Limited Company
Owned by shareholders who are typically the directors of the business. Shares cannot be offered to the general public. (Ltd). It is an incorporated business (company classification, has its own separate entity in the eyes of the law). Owners are not necessarily involved in the running of the business.
47
Franchising
Acquisition of a proven business model and use of its brand and product, etc to open up a new store. Two key stakeholders: franchisee (person who purchases the rights to the franchise from the franchisor) and franchisor (person or company that owns the trademarks and business model and receives payments from the franchisee).
48
Corporate Social Responsibility (CSR)
Refers to the values, decisions and actions that impact society in a positive way. It is about an organisation’s moral obligations to its stakeholders, the community, society as a whole and the environment.
49
Strategic Objectives
Medium to long term objectives set up by senior managers to guide the company in the right direction to achieve the aims. These may be risky, a large investment is required, and cannot be easily reversed.
50
Tactical Objectives
Medium to short term objectives set by middle managers to achieve the strategic objectives. The risk is relatively low, likely to require few resources, and easy to change.
51
Operational Objectives
Day-to-day objectives set by floor managers (and sometimes workers themselves) so that the company can reach its tactical objectives.
52
Market Penetration
A growth strategy where the business focuses on selling existing products into existing markets.
53
Market Development
A growth strategy where the business seeks to sell its existing products into new markets.
54
Product Development
A growth strategy where a business aims to introduce new products into existing markets. This strategy may require the development of new competencies and requires the business to develop modified products which can appeal to existing markets.
55
Diversification
A growth strategy where a business markets new products in new markets. This is an inherently more risky strategy because the business is moving into markets in which it has little or no experience.
56
Arbitration
Arbitration is a method of settling disputes between individuals, groups, or countries. The two parties choose some disinterested and qualified person or people—the arbitrator—to judge the matter. The arbitrator listens to what the two parties have to say, considers the facts, and then makes a decision.
57
Competitors
Other businesses who can offer the same or similar goods and services to your customers.
58
Conciliation
A voluntary process in which a professional facilitator assists employers and employees to resolve disputes when their own unassisted efforts have not succeeded.
59
Conflict
A state of discord caused by the actual or perceived opposition of needs, values and interests between people working together.
60
Internal Stakeholder
People whose interest in a company comes through a direct relationship, such as employment, ownership, or investment.
61
External Stakeholders
People who do not directly work with a company but are affected somehow by the actions and outcomes of the business. Suppliers, creditors, and public groups are all considered external stakeholders.
62
Employees
Someone you hire and pay regular wages to perform a specific job, with the employer controlling how the work is performed.
63
Shareholders
A person or institution that has invested money in a corporation in exchange for a “share” of the ownership.
64
Financiers
A person, company, or government that provides money for projects or businesses.
65
Business
An organisation or enterprising entity engaged in commercial, industrial, or professional activities.
66
Entrepreneur
Someone who has an idea and who works to create a product or service that people will buy, as well as an organisation to support that effort.
67
Pressure Groups
Any group of individuals who work together to exert an influence upon the decision-making of a company to achieve some specific outcome.
68
Managers
An individual within an organisation who is in charge of coordinating the efforts of individuals or the allocation of resources.
69
Local Communities
The local community is made up of the people who live in the area where the business is located. Though not necessarily customers of the business they are all neighbours to the business.
70
Directors
The group of senior managers who are legally responsible for the overall running of a company on behalf of their shareholders (the legal co-owners of the company).
71
Demerger
When a company splits off one or more divisions to operate independently or be sold off.
72
Conglomerate
A corporation made up of several different, independent businesses.
73
Vertical Integration
The business arrangement in which a company controls different stages along the supply chain.
74
Forward Vertical Integration
Happens when a business improves its production cycle by taking control of all the stages in the supply chain to create its product.
75
Backward Vertical Integration
A form of vertical integration in which a company expands its role to fulfil tasks formerly completed by businesses up the supply chain. In other words, backward integration is when a company buys another company that supplies the products or services needed for production.
76
Acquisition
A business transaction that occurs when one company purchases and gains control over another company.
77
Diseconomies of Scale
Happens when a company or business grows so large that the costs per unit increase. It takes place when economies of scale are no longer functional for a firm.
78
External Growth
Focuses on the areas you don't have direct control over, including capturing new customers. Generally, this means acquiring another business, merging with another competitor, or looking at strategic alliances and partnerships to achieve your overall growth goals.
79
Financial Economies of Scale
Cost advantages that can occur when a company increases their scale of production and becomes more efficient, resulting in a decreased cost-per-unit.
80
Joint Ventures
When two or more businesses agree to work together.
81
Franchise
Method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.
82
Synergy
The concept that the value and performance of two companies combined will be greater than the sum of the separate individual parts.
83
External Economies of Scale
Business-enhancing factors that occur outside a company but within the same industry. In addition, to lower production and operating costs, external economies of scale may also reduce a company’s variable cost per unit because of operational efficiencies and synergies.
84
Takeover
Occurs when one company makes a successful bid to assume control of or acquire another.
85
Risk-bearing
Risk-bearing in entrepreneurship means taking responsibility for risks taken and accepting potential losses.
86
Capacity Utilisation
The manufacturing and production capabilities that are being utilised by a nation or enterprise at any given time.
87
Friendly Acquisition
When the target company’s management and shareholders agree to be purchased.
88
Hostile Acquisition
The target company’s management and shareholders disagree, encouraging the acquirer to pursue alternative strategies (such as a tender offer and a proxy fight) to expedite the purchase.
89
Monetary Value
The amount that would be paid in cash for an asset or service if it were to be sold to a third party.
90
Gross Domestic Product
GDP measures the monetary value of final goods and services—that is, those that are bought by the final user—produced in a country in a given period of time.
91
Host Country
A country where a company that is based in another country has business activities.
92
Protectionist Policies
The policy of protecting domestic industries against foreign competition through tariffs, import quotas and subsidies, or other restrictions placed on the imports of foreign competitors.
93
Foreign Direct Investment
Is investment made to acquire a lasting interest in or effective control over an enterprise operating outside of the economy of the investor.
94
Globalisation
Word used to describe the growing interdependence of the world's economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information.
95
Multinational Corporation (MNC)
Multinational corporation is one that has business offices and operations in two or more countries in the world. These companies are often managed from a central office headquartered in the home country.
96
Decentralised Corporation
A decentralised corporation maintains a presence in its home country and has autonomous offices and other facilities in locations around the world.
97
Centralised Global Corporation
A centralised global corporation has a central headquarters in the home country. Executive officers and management located there oversee the global offices and operations as well as domestic operations.
98
International Division Within a Corporation
An international division is that part of the multinational corporation that has been made responsible for all international operations. This structure facilitates business decision-making and general activities in local, foreign markets.
99
Transnational Corporation
A transnational corporation involves a parent-subsidiary structure whereby the parent company oversees the operations of subsidiaries in foreign countries as well as in the home country. Subsidiaries can make use of the parent's assets, such as research and development data. Subsidiaries may be different brands, as well. The parent usually maintains a management role directing the operations of its subsidiaries, domestic and foreign.
100
Ageing Population
An increasing median age in a population because of declining fertility rates and rising life expectancy.
101
Demography
The study of statistics such as births, deaths, income, or the incidence of disease, which illustrate the changing structure of human populations.
102
Flexitime
A system of working a set number of hours with the starting and finishing times chosen within agreed limits by the employee.
103
Human Resource Planning (Workforce Planning)
A broad term used to describe the overall management of an organisation's workforce.
104
Recruitment
Hiring the right number of appropriately qualified and suitable workers at the right times to fill job vacancies.
105
Induction
Training to get new employees acclimatised to the norms and operations fo the organisation.
106
Retention
Keeping workers at the organisation by meeting the needs of employees.
107
Appraisal
The formal procedure of assessing the performance and effectiveness of employees in relation to their job description.
108
Absenteeism
Dealing with issues that arise when employees are unable to attend work.
109
Dismissal
Letting go of employees that are no longer needed, often due to underperformance or misconduct in the workplace.
110
Redundancies
Letting go of workers if/when their jobs are no longer needed, perhaps due to prolonged economic recession.
111
Training & Development
Improving the competencies, skills, and productivity of workers.
112
Performance Appraisals
Holding workers accountable for their performance/conduct at work.
113
Short-term Workforce Planning
Immediate needs e.g. workers who will go on maternity leave, sick leave, enter retirement, or have been suddenly dismissed.
114
Long-term Workforce Planning
Support the strategic plan of the organisation, e.g. the expansion of the business in new locations and different countries.
115
Demographic Change
Average age of the population, distribution of population by ethnicity, gender distribution, educational attainment levels, average household income, official retirement age in the country.
116
Labour Mobility
Measures the extent to which workers have the ability and willingness to move between geographical locations and/or occupations for their employment.
117
Occupational Mobility
Refers to the ability and willingness of employees to do another job or pursue a different career. Occupational mobility can be improved if employees have the necessary qualifications, experience and skills to move from one job to another.
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Geographical Mobility
Refers to the ability and willingness of employees to relocate to another location or country for work reasons. Some jobs require their employees to travel long distances for work purposes, such as delivery truck (lorry) drivers, pilots, and sales executives.
119
Gig Economy
Labour markets in which workers are given short-term or one-off contracts, such as freelance work, rather than long-term or permanent jobs.
120
Delegation
The division of labour and decision-making responsibility to an individual that reports to a leader or manager. Ex. a manager dividing their own work among all their people.
121
Span of Control
The number of subordinates that can be managed effectively and efficiently by supervisors or managers in an organisation.
122
Levels of Hierarchy
The various levels within the organisational structure at which authority and responsibility are attached.
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Chain of Command
The different levels of command within the organisation.
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Bureaucracy
A complex organisation that has multilayered systems and processes.
125
Centralisation
The concentration of management and decision-making power at the top of the organisational hierarchy for the purpose of coordinating financial, human, and other business resources.
126
Decentralisation
When daily operations and decision-making power are delegated by top management to middle-and lower-level manager.
127
Delayering
The process of removing layers of management in order to improve organisational efficiency.
128
Matrix Structure
A work structure where team members report to multiple leaders.
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Organisational Chart
A diagrammatic representation of an organisation’s formal organisational structure.
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Organisation by Function
Structuring a workforce according to business functions, i.e. specialised roles or tasks.
131
Organisation by Product
Structuring a workforce according to the goods or services sold.
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Organisation by Region
Structuring a workforce according to different geographical areas based on where the firm’s operations are.
133
Leadership
A key part of being a successful manager. It involves setting clear direction and vision for a business that others will be prepared to follow.
134
Manager
Are responsible for selling objectives, organising resources, motivating the staff to make sure that the organisation’s aims are met.
135
Leader
The art of motivating a group of people towards achieving a common objective.
136
Autocratic Leadership
A style of leadership that keeps all decision making at the centre of the organisation. Decisions are made without discussion. Armed forces and police adopt this type of leadership.
137
Paternalistic Leadership
A type of fatherly style typically used by dominant males where their power is used to control and protect subordinates employees who are expected to be loyal and obedient. Managers will pay attention to the social aspects of their employees and listen to them. In the grand scheme employees will have no influence on decision making and this can breed resentment.
138
Democratic Leadership
A leadership style that promotes the active participation of workers in making decisions. Managers will engage with the workforce. To be successful there needs to be good efficient communication. It can be a slower process due to the consultation of employees.
139
Laissez-faide Leadership
A leadership style that leaves much of the business decision making to the workforce, a hands-off approach and the opposite to autocratic. Effective in research and design tasking. But in other instances it could be disastrous if employees are left to make their own decisions. (Creative industries).
140
Situational Leadership
Effective leadership varies with the task in hand and situational leaders adapt their style to each situation.
141
Intrinsic Motivation
Occurs when someone gets satisfaction from an activity without outside rewards.
142
Extrinsic Motivation
Considers the influence of outside motivators, e.g. pay, bonuses. These extrinsic motivators provide the satisfaction/motivation that the job itself does not provide.
143
Labour Turnover
The rate at which employees are leaving an organisation. It can be measured by: number of employees leaving in 1 year /average number of people employed x 100.
144
On The Job Training
This training is exactly as it sounds, being trained whilst on the job. It can involve different forms, usually shadowing another employee (learning from them). It is cheap and the firm is not losing money as you are still working and producing goods and services.
145
Off The Job Training
The employee will usually go to a training event or part take in a training course. This happens off-the-job. It is more expensive as it is specifically designed to an advanced level so the employee can gain valuable skills that they can bring back to the business.
146
Cognitive Training
Cognitive training is rather a new type of training. It has become more popular as we are more aware of mental well being. It involves brain exercises to help employees focus and have self control. With more focus an employee is of greater value to a firm.
147
Behavioural Skills Training
This type of training aims to provide employees with the ability to communicate effectively with others and to interact with them in a constructive way. It can include:
* Communication skills
* Change management skills
* Conflict management skills
* Presentation skills
* Assertiveness skills
* Customer service skills
148
Poaching
- (Taking the ones already trained)
When discussing benefits and costs of training it is often a good idea to consider the theory of “poaching”. Poaching refers to other firms poaching/stealing other firms' best employees. If an employee is trained to a high standard they could potentially be poached by rivals. This could be viewed as a bargaining tool for the employee but a disadvantage for the businesses.
149
Employee Appraisal
“The process of assessing the effectiveness of an employee judged against preset objectives”. Employee appraisal is normally undertaken annually. It is key to employee development used correctly. (links with Herzberg’s motivation theory). It involves the setting of targets that the employee will strive to achieve and these are normally linked to objectives of the business.
150
Formative Appraisal
Involves both formal and informal assessment methods. Supervisors will monitor an employee’s progress, but also give support and guidance for improvement. It mostly involves qualitative feedback rather than quantitative. If formative appraisal is done well it can be highly effective and can promote a supportive learning environment for everyone.
151
Summative Appraisal
More quantitative and is used to measure the level of an employee’s proficiency in relation to predetermined benchmarks. To be effective the appraiser must sit with the appraisee and discuss the targets that are being set. It is important that both parties agree on the set targets. Targets will involve a benchmark to be reached, normally over a given timeframe. These are normally linked to pay. If targets are reached then pay will normally increase, if not then other factors could be considered (support plans).
152
360-Degree Feedback Appraisal
This type of appraisal involves many people. It does not just use the supervisor and the employee but considers a wide variety of people involved with the business. 360 degree feedback would involve various people who come into contact with the employee: (1) Work colleagues and peers, (2) Subordinates, (3) Supervisors, (4) Internal & External customers. Not linked to pay, but more to assess the training needs for the employee and the workplace.
153
Self Appraisal
Self-appraisal is when you appraise (grade) yourself. It is used within the performance management review system. Normally, prior to a meeting the employee will complete a self review form. This form will be the basis of the meeting. At the meeting the manager and the employee will negotiate the form and the successfulness of the year and decisions will be made. New targets could be set for the following year. Targets are usually linked to business objectives.
154
Formal Communication
Information is reached through proper channels and routes. It is also called official communication. Its main aim is to properly converse, making sure the information is communicated correctly.
155
Informal Communication
Communication that does not undertake formal methods to communicate. (Verbal, text, call, etc).
156
Trade Union (Labour Union)
An organisation of working people with the objective of improving the pay and working conditions of its members and providing them with support and legal services. Being in a trade union is not free. You have to pay to be a member of a trade union.
157
Industrial Action
Measures taken by the workforce or trade union to put pressure on management to settle an industrial dispute in favour of employees.
158
Trade Union Recognition
When an employer formally goes to conduct negotiations on pay and working conditions with a trade union rather than bargaining individually with each worker.
159
Collective Bargaining
The negotiations between employee representatives (trade unions) and employers and their representatives on issues of common interest such as pay and working conditions.
160
Single-Union Agreement
When an employer recognises just one union for the purpose of collective bargaining.
161
No Strike Agreement
Unions sign an agreement with employers not to strike in exchange for greater involvement in decisions that affect the workforce.
162
Marketing
The process of anticipating, identifying and satisfying the needs and desires of customers in a profitable way. The process of completing business functions such as market research, customer service, pricing and more to successfully promote and communicate the value of a good/service to your target market.
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Market-orientated
“An outward-looking approach basing product decisions on consumer demand. As established by market research”.
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Product-orientated
“An inward-looking approach that focuses on making products that can be made - or have been made for a long time -and then trying to sell them”.
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Niche Market
A narrow, smaller, or more specific market segment.
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Mass Market
A large or broad market that ignores specific market segments.
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Targeting
The process of marketing to a specific market segment.
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Marketing Planning
The process of formulating appropriate strategies and preparing marketing activities to meet marketing objectives.
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Consumer Profiling
A quantified picture of consumers of a firm’s products, showing proportions of age groups, income levels, location, gender and social class (e.g. supermarket card). Consumer profiles allow companies to identify which market segments to target.
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Segmentation
Following on from the consumer profiling market segmentation can occur. Market segmentation is the process of dividing the market into distinct groups of consumers to meet their desired needs & wants. Markets can be segmented in numerous ways.
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Demographic Segmentation
This considers the characteristics of the human population: (e.g. Age, gender, income, religion family characteristics, ethnic grouping, languages).
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Geographic Segmentation
Geographical considerations (e.g. regions - businesses could segment different products to those in urban rural areas, climate conditions - winter clothes for those in Canada but not those in Australia).
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Psychographic Segmentation
This considers people’s lifestyle choices, personality, EVS, etc. (Values - refers to people’s beliefs, morals and principles. Ethically responsible businesses such as the body shop appeal to people who are against animal testing. Advocacy groups (or pressure groups) such as Greenpeace.
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Branding
Branding is the process of distinguishing one business’s product from another which can add great value to a product.
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Brand Awareness
The extent people recognise the brand. Can be expressed as a %.
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Brand Development
The ongoing marketing process to develop the brand.
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Brand Loyalty
When customers/consumers repeatedly purchase from the brand.
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Brand Value
The emotional connection consumers feel with a product or company which influences their reaction of the product and/or company.
179
Cost-plus Pricing (Mark-up Pricing)
- Considers fixed costs
- Is the act of adding a percentage to the fixed cost of a complete product (e.g. To make product it costs = £1.50, selling price is 30% more than £1.50. Selling price = £1.95).
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Penetration Pricing
Setting a low price at the start to enter the market and gain market share. Overtime they will raise their prices.
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Loss Leader
When extremely low prices are charged to attract many customers.
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Predatory Pricing
Temporarily reducing the price of a product to force competition out of the industry. (Can be considered illegal).
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Premium Pricing
When the price of a product is set significantly higher than similar competing products.
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Dynamic Pricing
Changing the price of a product or service to reflect market demand.
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Competitive or Going-Rate Pricing
This considers what prices the competition is doing and what prices they are charging.
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Contribution Pricing
(Considers direct costs) - This is pricing the product based on the direct costs of a business. Contribution = selling price - variable costs.
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Price Elasticity of Demand
This measures the responsiveness of demand for a product due to a change in price.
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Price Elastic
If a small change in the price of a product causes a big change in the quantity demanded by consumers, their demand for that product is said to be price elastic. If PED is greater than 1 (in the formula) it is said to be PRICE ELASTIC.
- PED = Price Elasticity of Demand.
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Price Inelastic
If a small change in the price of a product causes a minor change in quantity demand, consumer demand for that product is said to be price inelastic. If PED is less than 1 it is said to be PRICE INELASTIC.
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Above The Line Advertising
This uses mass media to promote a firm's products. (e.g television, radio, newspapers, magazines, cinemas, billboards, internets). Above the line is very expensive.
191
Below The Line Advertising
This is a form of communication where a firm has direct control over its promotional activities. It does not depend on the use of independent media. Below the line can be:
- Direct marketing - a strategy aimed at specific customers.
- Personal selling - the sale of a product through personal selling (cars).
- Public relations - this is to enhance the image of a business. Can include the use of sponsorships (football teams).
- Sales promotion (Money off coupons, Point of sale displays, Free offers competitions, “BOGOF” - Buy one get one free).
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Through The Line Advertising
A mashup of the promotion tactics and mediums used in both ATL and BTL advertising in order to get better results. It's a marketing strategy that is used for campaigns that seek to achieve brand building as well as conversions.
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Guerrilla Marketing (ATL)
A strategy designed to promote products in a low-cost unconventional way that makes a large impact and lasting impression on the general public. It involves an imaginative approach, which can include publicity stunts, viral videos, flash mobs, etc. Suitable for small businesses with small budgets to combat traditional forms of advertising (which can be expen
- ATL = Above The Line
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Social Media Marketing (SMM)
Social media marketing refers to the promotional practice of gaining online traffic through social media platforms such as Facebook, Twitter, LinkedIn, Instagram, Youtube, and Google. SMM focuses on creating marketing content that attracts attention and encourages people to share this using their own methods via technology.
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Manufacturer
The person/company/firm that makes the product.
196
Wholesaler
The place that stores all the stock, normally in warehouses.
197
Distributors
Independent specialist that trade in products of only a few manufacturers e.g. car distributors.
198
Agents/Brokers
Representatives and negotiators who act on behalf of the buyer and vendors (sellers) of a product. Agents will charge commission on sales.
199
Retailers
Shops or businesses that sell the products to he consumer.
200
People
Refers to employees and managers of a business and how they relate to customers and communicate with them. The people employed by a business, especially where customers cannot judge a company by the attributes of physical products, can either give it a competitive advantage or lead to a poor customer reaction or disloyal customers.
201
Process
The systems used to deliver the goods or services, i.e. the process. Processes must be continuously updated in order for firms to remain competitive. Think of the following:
1. McDonald’s (the ordering process)
2. Banks (renewal of ATM Cards)
3. Online Banking (access 24 / 7, from any location)...(Younger Customers)
202
Physical Evidence
Refers to the “environment in which the service is delivered and where the firm and customer interact, and any tangible component that facilitates performance or communication of the service”. This refers to the way the businesses goods and services appear from the outside.
203
Producers
People who make or grow goods and provide services.
204
Market
Any place where two or more parties can meet to engage in an economic transaction.
205
Profit
The money a business pulls in after accounting for all expenses.
206
Inflation
The rate of increase in prices over a given period of time.
207
Deflation
A sustained fall in an aggregate measure of prices.
208
Economics
A field of applied economics that studies the financial, organisational, market-related, and environmental issues faced by corporations.
209
Trade
The voluntary exchange of goods or services between economic actors.
210
Investment
An asset acquired or invested in to build wealth and save money from the hard earned income or appreciation.
211
Demand
The quantity of consumers who are willing and able to buy products at various prices during a given period of time.
212
Negotiation
A process where two or more parties with different needs and goals discuss an issue to find a mutually acceptable solution.
213
Communication
The process of sharing information between people within the workplace and outside a company.
214
Budget
A spending plan for your business based on your income and expenses.
215
Merchandise
The marketing and sales of products.
216
Ease of Business
A measurement of how difficult or easy it is to do business with the Company measured through a survey.
217
Market Research
Marketing activities designed to discover the opinions, beliefs and preferences of potential and existing customers.
218
Shareholder Value
The value enjoyed by a shareholder by possessing shares of a company.
219
Foreign Direct Investment (FDI)
Cross border investment in which a business establishes an ongoing and significant financial stake in its operations in an overseas country.
