Key Terms and Definitions

Chapter 25

Generic product definition: is a term coined by Kotler and Levy (1969) to encapsulate the most basic marketing principle of all – that one should define market opportunities in terms of the underlying need to be served rather than in terms of the product currently available to serve that need.

PLC : Product Life-Cycle - is a ‘generalised model of the sale trend for a product class or category over a period of time, and of related changes in competitive behaviour’ (Buzzell, 1966) . The PLC consists of four stages: product introduction, growth, maturity and decline.

Limited strategic alternatives: it is a simple idea which postulates that there is only a small number of basic strategies open to a firm: (a) do nothing, (b) direct competition, (c) indirect competition, (d) innovation, (e) withdrawal.

Business portfolio analysis: for the majority of firms survival and prosperity depend upon their having a range of products at different stages in their life-cycle so that as old products are withdrawn new ones are introduced to replace them. Analysis of the portfolio is necessary so as to prepare relevant strategies.

Marketing audit: an essential ingredient to strategic planning that is also referred to as the SWOT analysis and which firms use to identify threats and opportunities in the external environment as a basis for maximising their own corporate strengths and minimising their weaknesses.

Selective perception: the unconscious filtration process that reduces the plethora of sensory stimuli to which the individual is exposed to that small portion which becomes part of personal experience, choosing those stimuli which are rated subjectively as being of relevance. In other words it is a phenomenon whereby individuals screen out stimuli which they do not understand or do not wish to recognize. Pp232

Customer diversity: the idea that customers differ from each other and that there is rarely, if ever, a homogenous demand for a given product.

Market segmentation: the identification of groupings of consumers which are sufficiently alike and of sufficient size to constitute a worth-while market in their own right.

Differential advantage: a property or attribute possessed by a product, service or organisation which differentiates it from all other competing products or organisations in the same generic grouping or market. Pp84

Marketing mix: refers to the apportionment of effort, the combination, the design, and the integration of the elements of marketing into a programme or mix which, on the basis of appraisal of the market forces, will best achieve the objectives of an enterprise at a given time. The marketing mix equation consists of the ‘four P’s’- product, price, promotion and place. Pp151

Integrated marketing planning: is the process of marketing planning which is best undertaken in an environment where all members of the organisation subscribe to a philosophy of customer satisfaction which is reflected in the values, mission and objectives of the organisation.

Control and Feedback: are based on the idea that sophisticated marketing planning procedures are irrelevant and useless unless stringent effort is made to monitor performance. Control and feedback are the mechanism to achieve this.

3-in-1 marketing: the idea that SMP is concerned with providing answers to three basic questions: (a) “where are we now?” (b) “where do we want to go?” and “how do we get there?” It is concerned with the present, the future and the intervening or transitional period in between.