PRINCIPLES OF MARKETING
LESSON 1: TERMS TO REMEMBER FOR MARKETING
Marketing terms are a set of words or phrases you can use to describe processes or activities within product or service
marketing. These marketing activities generally facilitate or describe the creation, advertisement, or provision of a
business's offerings. Regardless of your position in an organization, understanding these terms can help you know a
product's position in the market and get an insight into critical performance metrics. Additionally, even effective
presentations at work won't always define these terms. It's your responsibility to stay up-to-date on industry language.
1. Digital marketing
Digital marketing uses technology and online tools, such as phones, computers, and other digital platforms, to advertise
and promote a business offering. It's a business strategy that involves delivering advertisements for products through
social media, websites, e-mails, mobile apps, and search engines. Another name for this term is online marketing, and it
helps businesses increase their customer base and reach.
2. Advertising
Advertising is the process of creating awareness for a business, product, or service. It's an effective strategy for
communicating with a product or service's users and promoting the value of these offerings to them. Companies use
advertising to create a message that targets a specific audience to influence them to buy, sell, or use a particular
business offering.
3. Return on investment (ROI)
ROI is a performance measure helpful in evaluating an investment's profitability or efficiency. Mathematically, ROI is the
returns or benefits of an investment divided by the investment's cost. This performance measure helps rank investments
in different assets or projects and calculates the benefit an investor can enjoy in relation to an investment's cost.
4. Key performance indicator (KPI)
KPIs are quantifiable values or measures of a company's performance against stipulated targets and objectives.
Businesses use KPIs to determine the effectiveness of their financial, strategic, and operational achievements compared
to their competitors. Examples of KPIs include financial metrics and customer metrics.
5. Business to business (B2B)
B2B describes a commerce transaction between businesses, such as wholesalers and retailers. In a typical supply chain,
B2B refers to the purchase of products, such as raw materials, from other companies to use in a manufacturing process.
B2B in the context of communication happens when different companies' employees connect using various
communication methods, such as social media.
6. Business to consumer (B2C)
B2C is a transaction between businesses and their product end-users. It occurs when these businesses sell their offerings
directly to their consumers. B2C is popular in the digital world, as businesses can sell their products to consumers
directly. The common types of online B2C include advertising-based online intermediaries, fee-based direct sellers, and
fee community-based B2C.
7. A/B testing
A/B or split testing determines the better version of a business test subject by direct comparison. The test subjects
typically revolve around marketing content, including customer preference, website functionality, marketing campaigns,
and call-to-action button placement. Businesses use A/B testing to observe their audiences' preferences to implement
better processes that may increase lead conversion.
8. Lead conversion
A lead conversion uses tactics such as retargeting, e-mail nurturing, and behaviour automation to convert leads into
paying customers. A business lead is generally anyone who shows interest in a company's products or services. Lead
conversion details a lead's various stages before becoming a paying customer.
9. Buyer persona
A buyer persona is a fictional representation of a business's target audience or ideal client. Marketers use the buyer
persona as a guide when creating marketing campaigns, as it reminds them of their audience's needs. The buyer persona
describes a buyer's age, demographic details, behavioural traits, and interests.
10. Marketing funnel
A marketing funnel is a term that describes a customer's journey from the initial stage when they learn of the business
offerings to the purchasing stage. Businesses use marketing funnels to analyze actions and strategies to influence
customers' purchase decisions. Companies can connect with customers and bring visibility to every stage with a detailed
marketing funnel.
11. Click-through rate
A click-through rate measures the number of clicks businesses receive on their ads per the number of impressions.
Companies use this metric to measure an online advertising and e-mail campaign's success. With the click-through rate
of an ad campaign, businesses can estimate the total number of users who view the ad.
12. Search engine optimization (SEO)
SEO practices involve improving a site's visibility when users search for keywords related to the business on search
engines. Businesses create SEO strategies to ensure their sites rank high and appear on the first page of a search engine
result page. SEO is a critical aspect of online marketing, as users generally click on the sites on the first page of search
engines.
13. Call to action (CTA)
A CTA is a phrase or word that encourages an immediate sale or purchase. Examples of CTA are Sign up, Now, and Enrol.
They generally appear in the form of a button on a website's page. Businesses use CTAs strategically for campaigns and
incorporate them into advertising messages, sales scripts, and web pages.
14. Bounce rate
Bounce rate is a measure of the number of visitors that view a page on a website and leave the website rather than view
other pages within the site. It measures the percentage of visitors who leave the site without taking action, such as filing
a form, making a purchase, or clicking a link. Mathematically, bounce rate is the total number of single one-page visits
divided by the number of total visitors.
15. Landing page
A landing page is usually the first page users view after clicking on a link. This page is typically a standalone web page
different from other pages, as businesses design this page to generate business leads. A landing page varies and can
range from a blog post to any other page that can help convert traffic from a marketing campaign.
16. Hero shot
A hero shot is the primary video or picture businesses display on a website's landing page. It helps the website's visitors
get a perception of the feeling they may express when they take the business's offer. Companies use this image to infuse
the right mood and communicate their product's values to their website's visitors.
17. Keyword
A keyword in digital marketing refers to a word or phrase that describes a page's content. When users search for that
particular phrase or word on search engines, they can find websites that discuss the word or phrase. For example, a
fashion company can release content on winter coats. Users may find the business's website when searching for winter
coats.
18. Inbound marketing
Inbound marketing is a marketing strategy that involves attracting customers by creating relevant and valuable content
that appeals to them. This strategy can help businesses form connections with prospects and consumers by empowering
them to achieve their goals using the business's offerings. Companies use this methodology to attract customers, engage
with them, and delight them by providing support to help them find success with their purchases.
19. Account-based marketing (ABM)
ABM or key account marketing is a strategic marketing approach in which a business sales and marketing team work
together to create personalized buying experiences for high-value accounts. To identify these high-value accounts, the
team considers factors like the account's scalability, financials, and competitive landscape. After identifying these
accounts, they create account plans helpful in attracting these accounts.
20. Word-of-mouth (WOM) marketing
WOM marketing is a form of brand promotion that results from happy customers sharing their customer experience with
their contacts. It can be organic or a targeted effort from a company. This form of marketing is relatively free and may
result in additional sales. Businesses generally benefit from this promotion by increasing customer satisfaction and
offering high-quality products and services.
5 Essential Steps for a Successful Strategic Marketing Process
The strategic marketing process is a deliberate series of steps to help you identify and reach your goals. Even more, you’ll
discover what your customers want and develop products that meet those needs. Here are the steps to a successful
strategic marketing process.
1. Mission
2. Situation Analysis
3. Marketing Strategy/Planning
4. Marketing Mix
5. Implementation and Control
Take this as an example:
Mission: Apple is dedicated to making innovative, high-quality products.
Situation Analysis: Apple’s competitive advantage is driven by its commitment to understanding customer needs,
focusing on the products that are core to its mission, and fostering a collaborative work culture.
Marketing Strategy: Apple usually is first to the marketplace with new products and the company relies on brand loyalty
from existing customers as a strategy when launching new products and services.
Marketing Mix: While Apple offers a range of products, it values premium pricing and relies on strict guidelines for
distribution.
Implementation and Control: Each Apple product complements the others and work within the same ecosystem, so
customers tend to stay with the brand, creating loyal consumers.
Lesson 3: Level of Products
Core Benefit
The core benefit is the fundamental value or need that the product fulfills for the customers. It is the primary reason why
a customer would consider buying the product. For example, the core benefit of a car is transportation - it enables
people to travel from one place to another.
Understanding the core benefit is crucial as it forms the basis of the product concept. It helps in identifying the basic
requirements that the product must fulfill and sets the direction for its development. The core benefit is the most basic
level of a product and serves as the foundation for the subsequent levels.
Basic Product
The basic product is the physical or tangible form of the product that delivers the core benefit. It includes the basic
features and functionalities that enable the product to fulfill its core purpose. In the case of a car, the basic product
includes the engine, wheels, seats, and other essential components that make it capable of transportation.
While developing the basic product, it's important to focus on quality and functionality. The product should be designed
and manufactured in a way that it effectively delivers the core benefit and meets the basic expectations of the
customers. Any compromise on the basic product can significantly impact the overall value of the product and its
acceptance in the market.
Expected Product
The expected product refers to the attributes and conditions that the customers usually expect when they purchase a
product. These expectations are often influenced by the market standards, competitors' offerings, and the customers'
past experiences. For a car, the expected product may include a comfortable interior, good fuel efficiency, reliable
performance, and so on.
Meeting the expectations of the customers is crucial for the success of a product. It not only ensures customer
satisfaction but also helps in building a positive brand image. Therefore, businesses should constantly monitor the
market trends and customer feedback to understand the expectations and make necessary adjustments to their
products.
Augmented Product
The augmented product includes additional features or services that exceed the customer's expectations and
differentiate the product from its competitors. These could be free maintenance services, extended warranty, home
delivery, and so on. For a car, the augmented product could include advanced safety features, high-end entertainment
system, personalized customer service, and more.
Augmenting the product can significantly enhance its value and appeal in the market. It provides an opportunity for
businesses to differentiate their products and create a unique selling proposition. However, it's important to ensure that
the augmented features or services are relevant and valuable for the customers, and they align with the overall product
concept.
Potential Product
The potential product refers to the future enhancements or improvements that can be made to the product. It
represents the product's potential for growth and innovation. For a car, the potential product could be self-driving
capabilities, electric powertrain, AI-based features, and so on.
Identifying the potential product is crucial for long-term product planning and strategy. It helps businesses to stay ahead
of the competition and continuously innovate their products to meet the evolving market demands. However, it's
important to consider the feasibility and market acceptance of the potential enhancements before implementing them.
Prepared by:
Bini Aiah 😊
