M1BCh1 Flashcards
Uses time value for money. Each year’s future cash flows are discounted back to their present values.
Net Present Value (NPV)
Determines how long it will take to recoup an initial investment or break even.
Discounted Payback Period
Uses marginal costs to calculate the difference of implementing a product/service strategy (constructing, leasing, etc.) then compares to the benefits of making the change.
Financial Modeling
The net operating profit earned. Above the cost of capital for a profit center. Specifically accounts for the capital investment and cost before it calculates profit.
Economic Value Added (EVA)
The use of a name, term, symbol, or design, or combination thereof to identify a product.
Branding
The practice of using the four P’s (product, pricing, placement, and promotion) and other market variables to influence the demand of a product or service so that demand better matches available supply.
Demand Shaping
The systematic gathering, recording, and analyzing of data about problems relating to the marketing of goods and services. Such research may be undertaken by impartial agencies or by business firms or their agents. Includes several types: 1) market analysis is the study of the size, location, nature, and characteristics of markets 2) sales analysis (or research) is the systematic study and comparison of sales (or consumption) of data 3) consumer research (motivation research is a type) is concerned with the discovery and analysis of consumer attitudes, reactions, and preferences.
Marketing Research
Those competitive characteristics that a firm must exhibit to be a viable competitor in the marketplace. For example, a firm may seek to compete on characteristics other than price, but in order to ‘qualify’ to compete, its costs and the related price must be within a certain range to be considered by its customers.
Order Qualifiers
Those competitive characeristics that cause a firm’s customers to choose that firm’s goods and services over those of its competitors. [These can be considered to be competitive advantages for the firm. [They also] usually focus on one (rarely more than two) of the following strategic initiatives: price/cost, quality, delivery speed, delivery reliability, product design, flexibility, after-market service, and image.
Order Winners
Areas or aspects of an organization in which poor performance can cause loss of business. For example, failure to meet customer expectations with delivery of the product is [this].
Order Losers
Which of the 4 P’s start with a customer need in a customer-focused world?
Product
Which of the 4 P’s involves the location or contact channel strategy?
Placement
What is the goal of financial modeling?
To determine the feasibility and ROI of a product or service strategy
What 8 characteristics must channel strategy have?
- Accessible
- Reliable
- Complete
- Secure
- Direct
- Convenient
- Fast
- Flexible
How is placement different between traditional and customer focused models?
Traditional: One way communication, calling customers, retail shelves.
Customer Focused: Serving lifetime customers through customer care. More initiative
