Marketing dictionary -P
Package
the wrapping, packet, carton, bottle, box, etc, used for containment, protection or promotion of a product. See Packaging.
Package Modification
making any change to the attributes (shape, colour, size, graphics, lettering, etc.) of a package.
Packaged Goods
a sub-category of consumer non-durable goods; toothpaste, shampoo and soap powder are packaged consumer non-durables. See Consumer Non-Durables; Non-Packaged Goods.
Packaging
the materials (glass, aluminium, cardboard, etc) originally intended merely to contain and protect a product; in recent years the role of packaging has been broadened so that, in addition to containment and protection, its purpose is to attract attention, provide additional product information, and assist in promotion.
Palletisation
the packing of goods on to small wooden platforms, or pallets, for ease of handling in shipment.
Panel Test
a technique used to pre-test advertising, new products, etc; a group of individuals selected from the target market are asked to evaluate alternative versions (of an advertisement, new product, etc.)
Parasitic Advertising
advertising by one group which has an adverse effect upon another group. For example, the advertising of lamb may reduce sales of beef, the advertising of apples may reduce sales of pears.
Pareto's Principle
the idea or notion in business, commonly known as "the 80:20 rule", which says that eighty per cent of the revenue comes from twenty per cent of the products, that eighty per cent of the sales volume is derived from twenty per cent of the customer accounts, etc; named after Vilfredo Pareto, the nineteenth century economist and sociologist.
Paretopoly
a market situation in which there are a few large sellers and many smaller ones.
Paretopsony
a market situation in which there are a few large buyers and many smaller ones.
Parity Product
Pass-Up Method
handling a buyer's objection by attempting to ignore or "pass off" the buyer's objection, especially if there is reason to believe that the objection is not made seriously and does not warrant a response. See Objections.
Payback Period
the time taken for a new product to recover its investment cost and to generate profits; used as a measure of performance for new products.
PDM
abbrev. Physical Distribution Management; Product-Differentiated Marketing.
Penetrated Market
the individuals or organisations in a particular market who have already purchased the product.
Penetration Pricing
see Market Penetration Pricing.
People-Based Services
services in which people, rather than equipment or machinery, play the major role in delivery; for example, people play the major role in the delivery of financial planning services. See Equipment-Based Services.
Per Capita Income
average income per person in a population.
Per Diem Expense Plan
the payment of travel and accommodation expenses to a salesperson at a fixed daily rate.
Perceived Risk
see Risk.
Percentage-of-Sales Method
a method of setting a budget for promotion in which the sum to be expended in a given period is a fixed percentage of the sales income for the previous period.
Perception
the way in which an individual interprets stimuli received by the senses.
Perceptual Mapping
a tool or process used in marketing research for charting the way individuals selected from the target market perceive different companies, products or brands; also called Position Mapping.
Perfect Competition
see Pure Competition.
Performance Allowance
a discount or price reduction given to a wholesaler or retailer who promises to perform some additional activity (special display, etc) to sell a greater quantity of product.
Performance Appraisal
an evaluation of the activities and effectiveness of a salesperson, marketing officer, etc during a given period.
Performance Price
the value to a consumer of the time saved by using a new product to complete a specified task; the performance price can often offset other "time prices". See Non-Monetary Price; Time Price.
Performance Risk
concern in the buyer's mind that the product being considered for purchase will not work efficiently; also called Functional Risk. See Risk.
Perishable
one of the four characteristics (with inseparability, intangibility and variability) which distinguish a service; stretchability expresses the notion that a service cannot be made in advance and stored. See Services Marketing; Inseparability; Intangibility; Variability.
Person Marketing
marketing activity aimed at creating target market awareness, and a favourable opinion, of a particular person.
Personal Income
the wages, salary, etc. earned by an individual.
Personal Interview
a face-to-face meeting with a client, job applicant, buyer, marketing research respondent, etc.
Personal Selling
a form of promotion utilising the services of a sales team; one of the major controllable variables (with advertising, sales promotion and publicity) of the promotion mix. See Promotion Mix.
Personality
the distinctive character of an individual; used as a basis for the psychographic segmentation of a market in which individuals of relatively similar personality, with similar needs or wants, are grouped into one segment. See Psychographic Segmentation.
Personality Segmentation
the division of a heterogeneous market into homogeneous groups on the basis of personality characteristics and enduring patterns of behaviour such as aggressiveness, compliance or compulsiveness. See Psychographic Segmentation.
Persuasive Advertising
advertising intended to persuade (rather than to inform or remind).
PERT
acronym for Program Evaluation and Review Technique; a quantitative technique used as a managerial tool in planning and controlling complex programs. Common use has been made of PERT, originally introduced for use in the aerospace industry, in the coordinating, timing and scheduling of the many activities in the new product development process.
Phantom Freight
a freight charge imposed upon a customer in excess of the true freight cost incurred by the supplier. For example, in the base-point pricing approach, a local customer will be charged a phantom freight when the freight charge is calculated from an arbitrarily-chosen, possibly distant, central point. See Base-Point Pricing.
Physical Distribution
the storage, handling and movement of goods within an organisation and their shipment to customers.
Physical Distribution Management
the management and control of the activities involved in the storage, handling and movement of goods within an organisation and in their shipment to customers.
Physical Risk
concern in the buyer's mind that the product being considered for purchase will be harmful, unhealthy or cause injury.
Physiological Needs
innate human feelings of deprivation related to an individual's biological well-being. See Psychological Needs.
Piggyback
a system of transportation requiring the transfer of containers from truck to rail. See Birdyback; Fishyback.
Piggybacking
a low-cost market entry tactic in which manufacturers of products arrange for manufacturers of complementary, non-competing products to represent their products in another country or region.
Pioneering Advertising
advertising which is intended to create primary rather than selective demand; commonly used at the introductory stage of the product's life cycle. See Primary Demand; Selective Demand.
Pipeline Transportation
the carriage, delivery or shipment of a gas or liquid product by pipeline.
Place
one of the four controllable variables (with product, price and promotion) of the marketing mix; the delivery of a good or service to a consumer; also referred to as Distribution. See Distribution; Marketing Mix.
Place Marketing
marketing activity intended to promote an awareness, and favourable opinion, of a particular place or region.
Place Strategy
the element of a firm's decision-making concerned with developing an efficient and effective means of storing and handling finished products and of getting them efficiently to the target market.
Place Utility
the value given to a product by virtue of the fact that it is where it is wanted.
Plain Vanilla
slang term for a product with only the most basic features; see Bells and Whistles.
Planned Cannibalization
the expected loss of sales of a product in a line to a more recent product introduction; planned cannibalization might occur when a company wants its customers to switch to another of its own products rather than to a product of a competitor. See Cannibalization.
Planned Economy -
;also called Controlled Allocation System; Command System; see also Free Market System; Capitalist System.
Planned Obsolescence
a tactic by which a manufacturer deliberately seeks to make earlier versions of its product appear undesirable in the eyes of consumers who have purchased them in order to expand the market for later versions by improving the characteristics of later versions or by altering consumers' perceptions of the desirability of the models they have already purchased.
Planning
see Strategic Planning; Marketing Planning; Sales Planning.
Planning Horizon
the total timespan covered by a firm's marketing plans; the length of the planning horizon is commonly determined by the degree of uncertainty in the environment.
PLC
Product Life Cycle
Point-of-Purchase Displays
a form of promotion used to support personal selling and advertising; displays, consisting of packages, signs, display cartons and so on (more common in the marketing of consumer goods) are used to provide additional product information and to impel on-the-spot buying.
Polyopoly
a market situation in which there are no large sellers but many small ones.
Polyopsony
a market situation in which there are no large buyers but many small ones.
POP
Point of Purchase.
Population
in marketing research, the total group that a researcher wishes to study; also called the Universe.
Population Characteristics
variables including age, gender, income, marital status, education, nationality, race, religion, etc. upon which a population may be segmented.
Porter, Michael
Portfolio Analysis
the systematic evaluation or assessment of a company's businesses or products; two variables frequently used in the evaluation are market attractiveness (including market growth rate) and business strength (including relative market share).
Portfolio Tests
a method of pre-testing an advertisement; after looking through a portfolio of different versions of a particular advertisement, respondents chosen from the target market are asked to recall in detail those which they can remember.
Position Mapping
see Perceptual Mapping.
Positioning
see Market Positioning
Possession Utility
the value given to a product by virtue of the fact that the purchaser has the legal right to own and use it freely.
POSSLQ
abbrev. Persons of Opposite Sex Sharing Living Quarters; sometimes written as POSLSQ - Persons of Opposite Sex Living in Same Quarters.
Post-Purchase Evaluation
the quick mental assessment of a low-involvement product by a consumer after purchase. See Low-Involvement Product.
Post-Purchase Satisfaction
the pleasure that a carefully selected high-involvement product gives to a consumer after purchase. See High-Involvement Product.
Postage Stamp Pricing
see Uniform Delivered Pricing.
Poster
an outdoor advertising medium; a billboard.
Potential Market
all the individuals and organisations in a particular market who have some level of interest in the product.
Potential Product
PR
Public Relations.
Pre-Approach Stage
the first stage in the selling process; the stage in which a salesperson prospects for new accounts, qualifies them and prepares to make contact with the client.
Pre-Testing
the testing of a questionnaire, advertisement, etc on respondents selected from the target market before using it in a full-scale research study, campaign, etc. See Questionnaire Pre-testing.
Pre-Ticketing
the practice by a vendor of placing a tag on each product sold listing its particular style, size, colour, etc; the pre-ticketing is designed to make re-ordering easier for a reseller.
Predatory Pricing
a pricing practice by which a company hopes to inhibit or eliminate competition by charging lower than normal prices for its products in certain geographic regions.
Premium Pricing
see High-Price Strategy.
Premiums
a type of sales promotion in which merchandise is given free or at a reduced price to purchasers of products or visitors to a store.
Press Conference
a meeting to which media personnel are invited by a government body, organization or company seeking to make a public announcement, usually to gain favorable publicity or to offset some negative reaction.
Press Release
an announcement released to the news media by a government body, organization or firm, usually to obtain publicity or to offset some negative reaction to it or its products; also called a News Release.
Pressure Group
any group of individuals who work together to exert an influence upon the decision-making of a company to achieve some specific outcome.
Pressure Selling
see High Pressure Selling.
Prestige Builder
the highest-priced item in a product line. See Product Line; Traffic Builder.
Prestige Pricing
a pricing strategy in which prices are set at a high level, recognising that lower prices will inhibit sales rather than encourage them and that buyers will associate a high price for the product with superior quality; also called Image Pricing. See Psychological Pricing.
Prestige Products
items of superior quality; high status merchandise.
Price
the value agreed upon by the buyer and the seller in an exchange; one of the four controllable variables (with product, promotion and place) of the marketing mix. See Marketing Mix.
Price Adjustments
allowances, discounts, etc. granted by a seller to meet the requirements or circumstances of specific buyers.
Price Band
the range within which a product can be priced as dictated by competitive intensity and the perceived value of the product to consumers.
Price Brand
see Fighting Brand.
Price Bundling
a pricing strategy in which various products sold to a customer together are offered at a price less than the sum of the prices of the products sold individually.
Price Ceiling
A price, usually imposed by law, above which market prices are not permitted to rise; also called a Ceiling Price. See Price Floor.
Price Competition
a competitive situation in which price is used as the major means of differentiating the product of one firm from that of a rival. See Non-price Competition.
Price Cycle
the regular, periodic fluctuation in the price of a product, especially of an agricultural product, owing to expansion or contraction in its supply.
Price Discounting
see Discount.
Price Discrimination
a pricing strategy, generally illegal, in which a seller charges different prices to marketing intermediaries for the same product. See Differential Pricing.
Price-Elastic Segments
segments of the market which are more responsive to price changes than other segments of the market. See Price Elasticity.
Price Elasticity
buyers' sensitivity to price; measured by the percentage change in quantity demanded that results from a percentage change in price. See Price In-elasticity.
Price Fixing
agreement or collusion between competitors to maintain certain fixed price levels to avoid competition. See Horizontal Price Fixing; Vertical Price Fixing.
Price Floor
A price, usually imposed by law, below which market prices are not permitted to floor; also called a Floor Price. See Price Ceiling.
Price Gouging
a monopolistic pricing technique in which the seller takes advantage of the lack of competition by charging unusually high prices relative to a product's cost.
Price Incentives
a common form of sales promotion in which price reductions are offered to consumers to encourage them to buy a particular product earlier or in larger quantity.
Price In-elasticity
buyers' insensitivity to price; when the percentage change in quantity demanded is less than the percentage change in price, consumers are price-insensitive. See Price Elasticity.
Price Leader
a firm whose prices set a lead for other firms in the industry to follow.
Price Leadership
a situation which occurs when one or a few companies, usually larger companies, are consistently the first to institute price changes.
Price Lining
pricing different products in a product line at various price points, depending on size and features, to make them affordable to a wider range of customers.
Price Objection
an objection raised by a prospective buyer on the grounds of price, credit terms, discounts, allowances, freight charges, etc. related to the cost of a product offered by a salesperson.
Price Packs
a type of sales promotion in which consumers are offered a reduction in the regular price of a product; the amount of the reduction is usually marked, or "flagged", prominently on the label or package; also called a "cents-off" deal.
Price Sensitivity
see Price Elasticity.
Price Space
the price difference between items in a product line; having the right amount of price space is often critical as too little space may confuse buyers and too much space may leave gaps which can be exploited by competitors. See Product Line.
Price-Taker
any firm which is unable to influence the general level of commodity prices by altering the quantity of the product produced; a firm operating in a perfectly competitive market situation is, necessarily, a price-taker. Price-takers are sometimes also referred to as Quantity Adjusters as their chief decision is to adjust the amount they produce to a given price. See Perfect Competition.
Price Wars
a conflict situation likely to occur in industries where products cannot be greatly differentiated; a decrease in price by one company will attract a large number of customers to it, forcing other companies to retaliate by cutting the price even further.
Price-Value Relationship
the connection that consumers make between price and quality; products with a higher price are commonly perceived to be of better quality.
Pricing
marketing activity concerned with the setting of prices for new products and the adjustment of prices for existing products.
Pricing Strategy
the element of a firm's decision-making concerned with the setting of prices that will attract the target market and allow profit objectives to be met.
Primary Advertising
advertising intended to create demand for a class or category of product rather than for a brand. See Generic Advertising; Pioneering Advertising.
Primary Data
information that is obtained directly from first-hand sources by means of surveys, observation or experimentation. See Secondary Data.
Primary Demand
demand for a product class rather than for a particular brand within the class.
Primary Packaging
a product's immediate container or wrapper. See Secondary Packaging; Shipping Packaging.
Principle of Integrating Interests
a technique used in selling in which the salesperson, knowing the buyer's personal interests or buying motives, places emphasis on these in the presentation rather than on the features or benefits of the product.
Print Campaign
Private Brand
a brand owned by a wholesaler or retailer; also called a private label. See Manufacturer's Brand.
Private Carrier
any form of transport operated by an independent organization and used for the shipment of goods. See Common Carrier; Contract Carrier
Private Label
see Private Brand.
Private Treaty
a market agreement arranged by a buyer and seller in private negotiation.
Privatization
Proactive Marketing Strategies
marketing activities which anticipate competitive action and attempt to forestall it; offensive strategies. See Reactive Marketing Strategies.
Probabilistic Models
a statistical tool in which the probability that an event will occur again is estimated using historical data; for example, in sales forecasting past purchasing behavior is used to estimate the degree of probability with which consumers will purchase the same item again.
Probability Sample
a sample in which each individual within a total population has a known chance of being chosen.
Problem Children
see Question Marks.
Problem Situation Model
a model of a problem situation faced by a decision-maker, constructed (often by a marketing researcher) in order to get as clear a picture as possible of the problem; a problem situation model includes a description of the desired outcomes, the relevant variables, and the relationships of each of the variables to the outcomes.
Problem-Solving Approach
an approach to selling in which the salesperson works with the buyer to evaluate alternative solutions to a problem and to select the best; a consultative approach intended to build long-term relationships with clients. Also called Depth Selling.
Process Materials
a classification of goods bought by organizations for incorporation into a product; the process materials cannot be recognized in the finished product.
Procurement Costs
the costs involved in reordering an inventory item; the costs include the cost of processing and transmitting the order as well as the cost of the item itself.
Product
a bundle of need-satisfying tangible and intangible attributes offered to a buyer by a seller. See Actual Product; Augmented Product; Core Product.
Product Advertising
advertising in which a company promotes a particular good or service.
Product Attributes
distinctive tangible and intangible features of a product that give it its value to a user.
Product Audit
a systematic appraisal of a firm's product mix to evaluate its strengths and weaknesses and to assess the available opportunities.
Product Category
the specific generic to which a good or service belongs; for example, while Fanta is a brand name, the product category to which it belongs is soft drinks.
Product Concept
see Product Orientation.
Product Depth (of Line)
see Product Line Length.
Product Development
a growth strategy in which the firm develops new products for existing markets.
Product-Differentiated Marketing
a marketing philosophy in which the seller views the market as a homogeneous whole, but produces two or more products for it; the products, differing in attributes (price, style, quality, etc), are designed to offer variety rather than to satisfy the needs and wants of different market segments. See Mass Marketing; Target Marketing.
Product Differentiation
a strategy which attempts (through innovative design, packaging, positioning, etc.) to make a clear distinction between products serving the same market segment.
Product Differentiation Advantage
Product Elimination
the decision to drop a product (for example, in the decline stage of its life cycle) in order to use the costs associated with it to enhance profits or to release resources that could be more effectively used in other ways.
Product Extension
the introduction of a product that is known to the company but which has features or dimensions which are new to consumers; three types of product extensions are possible: revisions, additions and repositionings. See Innovation; New Product Duplication.
Product Failure
a product that does not meet management expectations in the marketplace.
Product Flanking
a competitive marketing strategy in which a company produces its brands in a variety of sizes and styles to gain shelf space and inhibit competitors.
Product Form Competitors
firms offering slightly different variants of the same basic product.
Product Item
a product variant with its own distinctive attributes (price, packaging, etc.); also called a Stock-Keeping Unit and a Stock-Taking Unit.
Product Knowledge
detailed knowledge of a product's features and benefits required by a salesperson to persuade a prospect to purchase.
Product Leveraging
see Brand Leveraging.
Product Liability
the onus or responsibility imposed by legislation on a manufacturer to warn consumers appropriately about possible harmful effects of a product, to foresee how it might be misused, etc.
Product Life Cycle
a concept which draws an analogy between the span of a human life and that of a product, suggesting that, typically, a product's life consists of four stages - introductory, growth, maturity and decline; the concept is used as a tool to formulate marketing strategies appropriate to each of the stages.
Product Line
a group of products manufactured or distributed by an organisation, similar in the way they produced or marketed; for example, Gillette markets a line of razors and blades, a line of toiletries, a line of pens and a line of cigarette lighters.
Product Line Brand Name
a brand name applied to several products within a product line. See Product Line; Individual Brand Name; Family Brand; Corporate Branding.
Product Line Expansion Segmentation Strategy
one of four possible segmentation strategies (with concentrated segmentation strategy, market segment expansion strategy and differentiated segmentation strategy) available to a firm in relation to the segment or segments it wishes to target; in a product line expansion segmentation approach a firm offers several products to one segment. See Segmentation Strategies; Concentrated Segmentation Strategy; Market Segment Expansion Strategy; Differentiated Segmentation Strategy.
Product Line Extension
adding depth to an existing product line by introducing new products in the same product category; product line extensions give customers greater choice and help to protect the firm from a flanking attack by a competitor. See Product Line; Product Line Depth; Product Line Stretching.
Product Line Featuring
a strategy in which certain items in a product line are given special promotional attention, either to boost interest (at the lower end of the line) or image (at the upper end). See Product Line.
Product Line Filling
introducing new products into a product line at about the same price as existing products. See Product Line.
Product Line Length
the number of different products in a product line. See Product Line.
Product Line Manager
see Category Manager.
Product Line Modernization
a strategy in which items in a product line are modified to suit modern styling and tastes and re-launched. See Product Line.
Product Line Pruning
reducing the depth of a product line by deleting less profitable offerings in a particular product category. See Product Line.
Product Line Retrenchment
reducing the width of a product mix by decreasing the diversity of items offered across product categories; product line retrenchment is common following the failure of brand leveraging to launch a brand into a related category. See Product Line; Product Mix Width.
Product Line Stretching
introducing new products into a product line. See Product Line; Downward Stretching; Two-way Stretching; Upward Stretching.
Product Management System
a system which ensures that total marketing control of a product line or brand rests with the person who has profit responsibility for it.
Product Manager
an individual given responsibility for the planning and co-ordinating of a firm's marketing activities related to a single product, product line or market.
Product Mix
the variety of distinct product lines and items manufactured or distributed by an organization. See Product Item; Product Line.
Product Mix Consistency
the degree of closeness or relatedness between product lines in the product mix. See Product Line; Product Mix.
Product Mix Width
the number of distinct product lines manufactured or distributed by an organization. See Product Line; Product Mix.
Product Modification
any substantial change made to the attributes (size, shape, color, style, price, etc.) of a product; modification of a product is usually undertaken in an attempt to revitalize it in order to increase demand.
Product Objection
an objection by a prospective buyer to the quality or characteristics of the goods offered by a salesperson. See Objections.
Product Organization
the deployment of a firm's sales force or the organization of its marketing activities so that a separate division is responsible for each of its major products or product groups. See Organizational Structure.
Product Orientation
a management philosophy, concept, focus or state of mind which emphasis's the quality of the product rather than the needs and wants of the target market; the orientation assumes that consumers will favour products that offer the most quality, performance and features and that the organisation's objectives will be most readily achieved by a concentration on these.
Product Petrification
a term used to describe the small but persistent demand by loyal customers for a declining product. See Product Life Cycle; Decline Stage.
Product Portfolio
the mix of products manufactured or distributed by a company. See Product Mix; Product Mix Width.
Product Portfolio Analysis
an examination of each of the products manufactured or distributed by the company to assess future marketing strategies. See Boston Consulting Group Portfolio Analysis Matrix.
Product Position Map
a tool used in comparing consumer perception of the differences between products or brands; consumers are asked to mark the particular location of a product or barnd on a two-dimensional "map", where the axes of the map are attributes felt by consumers to be important. See Perceptual Mapping.
Product Positioning
see Market Positioning.
Product Positioning Strategy
marketing decisions and actions intended to create a particular place for a product in the market and in the minds of consumers; a product positioning strategy may attempt to differentiate a marketing offer from a competitor's or to appear similar to it.
Product Recall
the advertised request by a company that a product be returned to it by those who have already purchased it; a product recall is often deemed desirable when a product proves to be unsafe or unreliable.
Product Strategy
the element of a firm's decision-making concerned with developing the most appropriate products for its target market.
Product Testing
exposing consumers to a new product, in final or prototype form, so that they might compare it to their usual brand and rate it; the results of product testing will indicate to the company whether further evaluation of the product in test markets is desirable. See Concept Development and Testing; New Product Development.
Product Variant
see Product Item.
Product Warranty
see Warranty; Express Warranty; Implied Warranty.
Product-Based Competitors
see Product Form Competitors.
Product-Based Marketing Organisation
a marketing structure of an organisation in which staff specialists have responsibility for various products of the organisation (rather than for particular markets); most appropriate when customer needs are differentiated by product. See Market-Based Marketing Organisation.
Product-Differentiated Marketing
an approach to marketing in which a company disregards market segmentation but produces goods and services that are different from others on the market.
Product-Push Approach
an approach to the generation of new product ideas in which a company's strengths rather than market needs are given prime emphasis. See Demand-Pull Approach.
Production Goods
a classification of industrial goods; goods purchased by industrial firms for use in the manufacture of their finished products. See Industrial Product Classes.
Production Orientation
a management philosophy, concept, focus or state of mind which emphasises production techniques and unit-cost reduction rather than the needs and wants of the target market; the orientation assumes that consumers will favour those products that are the most readily available and at the most affordable prices and that a concentration on efficiencies in production and distribution will most readily achieve the firm's objectives.
Profit and Loss Statement
an accounting statement showing income, expenditure and profit over a given period.
Profit Centre
a division of an organisation with responsibility for generating its own income, and with accountability for profits.
Profit Maximisation
see Current Profit Maximisation.
Profit Objective in Pricing
setting prices with short-run profits rather than long-term market share in mind.
Profit Sharing
a compensation system in which employees are awarded a share of the company's profits to encourage increased productivity.
Profitability Control
marketing effort intended to assess the level of profitability of each product in the portfolio, of each market segment, of each marketing channel, etc.
Progressive Commission
a sales commission system in which the commission rate increases as the salesperson sells more goods. See Regressive Commission.
Promotion
one of the four controllable variables (with product, price and place) of the marketing mix.
Promotion Manager
an individual within an organisation responsible for promotional activities and campaigns.
Promotion Mix
the range of means available to an organisation for communication with its target market - advertising, sales promotion, personal selling, publicity and public relations.
Promotional Adaptation
a strategy in which the same product is sold in different geographic locations but with a unique promotional strategy for some or all of the different locations.
Promotional Allowance
a price reduction or discount granted by a manufacturer to a member of the marketing channel in return for some form of special promotion of a particular product.
Promotional Budget
the sum allocated in a particular accounting period for expenditure on promotion.
Promotional Campaign
a coordinated series of promotional efforts built around a single theme and designed to achieve a specific objective.
Promotional Partnership
an alliance between a manufacturer of a product and another company for the purposes of promotion; for example, Coca-Cola Co. may form a promotional partnership with 20th Century Fox Film Corp., agreeing to pay that company to display the soft drink prominently in a forthcoming feature film. See Movie Tie-Ins; Entertainment Marketing.
Promotional Pricing
the temporary pricing of goods and services at lower than normal levels for a special promotional effort.
Promotional Stock
merchandise offered at a reduced price to a reseller for some special promotion or festive occasion; also referred to as Seasonal Stock.
Promotional Strategy
the element of a firm's decision-making concerned with choosing the most appropriate mix of advertising, sales promotion, personal selling and publicity for communication with its target market.
Promotional Warranty
a warranty designed to reduce the perceived financial or performance risk that a consumer might perceive in purchasing an expensive product. See Warranty; Express Warranty; Implied Warranty; Protective Warranty.
Prospect
a potential customer. See Sales Leads; Suspect.
Prospecting
the first step in the selling process; the activity of seeking out potential customers. See Sales Leads.
Prospecting Plan
a systematic approach to finding new customers involving the setting aside of time after allowing for calls on existing customers specifically for prospecting.
Protectionism
Trade policies of governments aimed at protecting domestic industries by limiting the volume of imports.
Protective Warranty
see Warranty; Express Warranty; Implied Warranty; Promotional Warranty.
Prototype
a sample or early version of a new product made or built specifically for trialling and testing.
Prototype Testing
the trialling of a sample of a newly developed product on selection of customers from the target market .
Proxemic Communication
a form of nonverbal communication or body language in which messages are conveyed from one person to another by the changing space that separates them during a conversation. See Kinesic Communication; Nonverbal Communication; Tactile Communication.
Psychodrama
a qualitative marketing research technique in which respondents are asked to engage in impromptu role-playing exercises intended to have them reveal their feelings about certain products or brands. See Qualitative Marketing Research.
Psychodrawing
a nonverbal, qualitative marketing research technique in which respondents use colours, shapes, symbols, etc. to express their feelings about certain products or brands. See Qualitative Marketing Research.
Psychographic Segmentation
the division of a heterogeneous market into relatively homogeneous groups on the basis of their attitudes, beliefs, opinions, personalities and lifestyles; sometimes called "State-of-Mind" Segmentation.
Psychography
the study of the attitudes, beliefs, opinions, personalities and lifestyles of individuals in a population.
Psychological Discounting
the advertising of a product at a heavily reduced price, as in "Was $49.95, now only $35.00"; the practice may be illegal under the Trade Practices Act unless the reduction is a genuine one.
Psychological Needs
innate human feelings of deprivation related to an individual's mental well-being. See Needs; Physiological Needs.
Psychological Repositioning
the attempt by a firm to alter the beliefs of prospective buyers about the key attributes of its product offering, especially where the buyers generally underestimate its quality. See Market Positioning; Real Positioning; Repositioning; Competitive Depositioning.
Psychological Pricing
pricing intended to influence the customers' perception of the actual price of a product; two common forms of psychological pricing are odd pricing and prestige pricing. See Odd Pricing; Prestige Pricing.
Psychological Risk
see Risk; Emotional Risk.
Psychological Set
a consumer's mind set; his or her positive or negative feelings or predispositions towards a particular brand or company. The consumer's mind set is formed by his or her needs, perceptions and attitudes. See Attitudes; Needs; Perception.
Public Policy Environment
that part of a firm's external environment which consists of controversial issues or matters of concern to governments, the media or influential pressure groups; factors in this environment may have an influence on a firm's decision-making or an impact upon its performance.
Public Relations
the relationship which exists between an organisation and its several publics; efforts to influence this relationship by obtaining favourable publicity.
Publicity
corporate or product promotion that is obtained free of charge.
Publics
the various groups in a society which can influence or bring pressure to bear upon a firm's decision making and have an impact upon its marketing performance; these groups include the financial public, media public, government public, citizen action public, local public, general public and international public.
Puffing
the legitimate practice of making obviously exaggerated claims in advertising, eg. "cleaner than clean".
Pull Strategy
promotion to end-users (mainly by means of advertising, sales promotion and publicity) rather than to members of the marketing channel (mainly by personal selling) to facilitate the flow of a good or service from producer to final consumer. See Push Strategy; Push-Pull Strategy.
Pulsing
scheduling advertising campaigns in fairly regular bursts followed by periods of relative or complete inactivity. See Continuity; Flighting.
Puppy Dog Close
a closing technique in which a salesperson urges an indecisive prospect to "take it home, play with it overnight", believing that once the product is in the customer's keeping he or she will be unwilling to part with it.
Purchase Allowance
see Off-Invoice Allowance.
Purchase Intentions
the likelihood that a consumer will buy a particular product resulting from the interaction of his or her need for it, attitude towards it and perceptions of it and of the company which produces it.
Purchase Laboratory
See Accelerated Test Marketing.
Purchase Probability Scale
a tool used in marketing research surveys of buying intentions; respondents are asked to rate the likelihood of their purchase of a particular product on a scale ranging, for example, from "definitely not" to "certain to buy".
Purchasing Officer
an individual within an organisation responsible for purchasing the goods and services it requires. See Buying Centre.
Purchasing Performance Evaluation
the establishment of criteria by which the performance of purchasing officers can be assessed and of incentive systems so that good purchasing can be rewarded.
Pure Competition
a marketing situation in which there are a large number of sellers of a product which cannot be differentiated and, thus, no one firm has a significant influence on price. Other prevailing conditions are ease of entry of new firms into the market and perfect market information. Also referred to as Perfect Competition and Atomistic Competition. See Monopolistic Competition.
Pure Monopoly
a marketing situation in which there is only one seller of a product. See Pure Competition.
Push Money
a direct payment of money offered to the sales force of a reseller by a manufacturer to encourage greater efforts with a particular product or range.
Push Strategy
promotion to members of the marketing channel (mainly by means of personal selling) rather than promotion to end-users (mainly by means of advertising, sales promotion and publicity) to facilitate the flow of a good or service from producer to final consumer. See Pull Strategy; Push-Pull Strategy.
Push-Pull Strategy
promotion of a good or service both to end-users and members of the marketing channel to facilitate its flow from producer to final consumer. See Pull Strategy; Push Strategy.
Pyramid Selling
a selling system, now illegal in Australia, in which members of a sales organisation derive their earnings by selling to newly introduced members of the distribution network (who pay a fee to enter) rather than to end-users.
the wrapping, packet, carton, bottle, box, etc, used for containment, protection or promotion of a product. See Packaging.
Package Modification
making any change to the attributes (shape, colour, size, graphics, lettering, etc.) of a package.
Packaged Goods
a sub-category of consumer non-durable goods; toothpaste, shampoo and soap powder are packaged consumer non-durables. See Consumer Non-Durables; Non-Packaged Goods.
Packaging
the materials (glass, aluminium, cardboard, etc) originally intended merely to contain and protect a product; in recent years the role of packaging has been broadened so that, in addition to containment and protection, its purpose is to attract attention, provide additional product information, and assist in promotion.
Palletisation
the packing of goods on to small wooden platforms, or pallets, for ease of handling in shipment.
Panel Test
a technique used to pre-test advertising, new products, etc; a group of individuals selected from the target market are asked to evaluate alternative versions (of an advertisement, new product, etc.)
Parasitic Advertising
advertising by one group which has an adverse effect upon another group. For example, the advertising of lamb may reduce sales of beef, the advertising of apples may reduce sales of pears.
Pareto's Principle
the idea or notion in business, commonly known as "the 80:20 rule", which says that eighty per cent of the revenue comes from twenty per cent of the products, that eighty per cent of the sales volume is derived from twenty per cent of the customer accounts, etc; named after Vilfredo Pareto, the nineteenth century economist and sociologist.
Paretopoly
a market situation in which there are a few large sellers and many smaller ones.
Paretopsony
a market situation in which there are a few large buyers and many smaller ones.
Parity Product
Pass-Up Method
handling a buyer's objection by attempting to ignore or "pass off" the buyer's objection, especially if there is reason to believe that the objection is not made seriously and does not warrant a response. See Objections.
Payback Period
the time taken for a new product to recover its investment cost and to generate profits; used as a measure of performance for new products.
PDM
abbrev. Physical Distribution Management; Product-Differentiated Marketing.
Penetrated Market
the individuals or organisations in a particular market who have already purchased the product.
Penetration Pricing
see Market Penetration Pricing.
People-Based Services
services in which people, rather than equipment or machinery, play the major role in delivery; for example, people play the major role in the delivery of financial planning services. See Equipment-Based Services.
Per Capita Income
average income per person in a population.
Per Diem Expense Plan
the payment of travel and accommodation expenses to a salesperson at a fixed daily rate.
Perceived Risk
see Risk.
Percentage-of-Sales Method
a method of setting a budget for promotion in which the sum to be expended in a given period is a fixed percentage of the sales income for the previous period.
Perception
the way in which an individual interprets stimuli received by the senses.
Perceptual Mapping
a tool or process used in marketing research for charting the way individuals selected from the target market perceive different companies, products or brands; also called Position Mapping.
Perfect Competition
see Pure Competition.
Performance Allowance
a discount or price reduction given to a wholesaler or retailer who promises to perform some additional activity (special display, etc) to sell a greater quantity of product.
Performance Appraisal
an evaluation of the activities and effectiveness of a salesperson, marketing officer, etc during a given period.
Performance Price
the value to a consumer of the time saved by using a new product to complete a specified task; the performance price can often offset other "time prices". See Non-Monetary Price; Time Price.
Performance Risk
concern in the buyer's mind that the product being considered for purchase will not work efficiently; also called Functional Risk. See Risk.
Perishable
one of the four characteristics (with inseparability, intangibility and variability) which distinguish a service; stretchability expresses the notion that a service cannot be made in advance and stored. See Services Marketing; Inseparability; Intangibility; Variability.
Person Marketing
marketing activity aimed at creating target market awareness, and a favourable opinion, of a particular person.
Personal Income
the wages, salary, etc. earned by an individual.
Personal Interview
a face-to-face meeting with a client, job applicant, buyer, marketing research respondent, etc.
Personal Selling
a form of promotion utilising the services of a sales team; one of the major controllable variables (with advertising, sales promotion and publicity) of the promotion mix. See Promotion Mix.
Personality
the distinctive character of an individual; used as a basis for the psychographic segmentation of a market in which individuals of relatively similar personality, with similar needs or wants, are grouped into one segment. See Psychographic Segmentation.
Personality Segmentation
the division of a heterogeneous market into homogeneous groups on the basis of personality characteristics and enduring patterns of behaviour such as aggressiveness, compliance or compulsiveness. See Psychographic Segmentation.
Persuasive Advertising
advertising intended to persuade (rather than to inform or remind).
PERT
acronym for Program Evaluation and Review Technique; a quantitative technique used as a managerial tool in planning and controlling complex programs. Common use has been made of PERT, originally introduced for use in the aerospace industry, in the coordinating, timing and scheduling of the many activities in the new product development process.
Phantom Freight
a freight charge imposed upon a customer in excess of the true freight cost incurred by the supplier. For example, in the base-point pricing approach, a local customer will be charged a phantom freight when the freight charge is calculated from an arbitrarily-chosen, possibly distant, central point. See Base-Point Pricing.
Physical Distribution
the storage, handling and movement of goods within an organisation and their shipment to customers.
Physical Distribution Management
the management and control of the activities involved in the storage, handling and movement of goods within an organisation and in their shipment to customers.
Physical Risk
concern in the buyer's mind that the product being considered for purchase will be harmful, unhealthy or cause injury.
Physiological Needs
innate human feelings of deprivation related to an individual's biological well-being. See Psychological Needs.
Piggyback
a system of transportation requiring the transfer of containers from truck to rail. See Birdyback; Fishyback.
Piggybacking
a low-cost market entry tactic in which manufacturers of products arrange for manufacturers of complementary, non-competing products to represent their products in another country or region.
Pioneering Advertising
advertising which is intended to create primary rather than selective demand; commonly used at the introductory stage of the product's life cycle. See Primary Demand; Selective Demand.
Pipeline Transportation
the carriage, delivery or shipment of a gas or liquid product by pipeline.
Place
one of the four controllable variables (with product, price and promotion) of the marketing mix; the delivery of a good or service to a consumer; also referred to as Distribution. See Distribution; Marketing Mix.
Place Marketing
marketing activity intended to promote an awareness, and favourable opinion, of a particular place or region.
Place Strategy
the element of a firm's decision-making concerned with developing an efficient and effective means of storing and handling finished products and of getting them efficiently to the target market.
Place Utility
the value given to a product by virtue of the fact that it is where it is wanted.
Plain Vanilla
slang term for a product with only the most basic features; see Bells and Whistles.
Planned Cannibalization
the expected loss of sales of a product in a line to a more recent product introduction; planned cannibalization might occur when a company wants its customers to switch to another of its own products rather than to a product of a competitor. See Cannibalization.
Planned Economy -
;also called Controlled Allocation System; Command System; see also Free Market System; Capitalist System.
Planned Obsolescence
a tactic by which a manufacturer deliberately seeks to make earlier versions of its product appear undesirable in the eyes of consumers who have purchased them in order to expand the market for later versions by improving the characteristics of later versions or by altering consumers' perceptions of the desirability of the models they have already purchased.
Planning
see Strategic Planning; Marketing Planning; Sales Planning.
Planning Horizon
the total timespan covered by a firm's marketing plans; the length of the planning horizon is commonly determined by the degree of uncertainty in the environment.
PLC
Product Life Cycle
Point-of-Purchase Displays
a form of promotion used to support personal selling and advertising; displays, consisting of packages, signs, display cartons and so on (more common in the marketing of consumer goods) are used to provide additional product information and to impel on-the-spot buying.
Polyopoly
a market situation in which there are no large sellers but many small ones.
Polyopsony
a market situation in which there are no large buyers but many small ones.
POP
Point of Purchase.
Population
in marketing research, the total group that a researcher wishes to study; also called the Universe.
Population Characteristics
variables including age, gender, income, marital status, education, nationality, race, religion, etc. upon which a population may be segmented.
Porter, Michael
Portfolio Analysis
the systematic evaluation or assessment of a company's businesses or products; two variables frequently used in the evaluation are market attractiveness (including market growth rate) and business strength (including relative market share).
Portfolio Tests
a method of pre-testing an advertisement; after looking through a portfolio of different versions of a particular advertisement, respondents chosen from the target market are asked to recall in detail those which they can remember.
Position Mapping
see Perceptual Mapping.
Positioning
see Market Positioning
Possession Utility
the value given to a product by virtue of the fact that the purchaser has the legal right to own and use it freely.
POSSLQ
abbrev. Persons of Opposite Sex Sharing Living Quarters; sometimes written as POSLSQ - Persons of Opposite Sex Living in Same Quarters.
Post-Purchase Evaluation
the quick mental assessment of a low-involvement product by a consumer after purchase. See Low-Involvement Product.
Post-Purchase Satisfaction
the pleasure that a carefully selected high-involvement product gives to a consumer after purchase. See High-Involvement Product.
Postage Stamp Pricing
see Uniform Delivered Pricing.
Poster
an outdoor advertising medium; a billboard.
Potential Market
all the individuals and organisations in a particular market who have some level of interest in the product.
Potential Product
PR
Public Relations.
Pre-Approach Stage
the first stage in the selling process; the stage in which a salesperson prospects for new accounts, qualifies them and prepares to make contact with the client.
Pre-Testing
the testing of a questionnaire, advertisement, etc on respondents selected from the target market before using it in a full-scale research study, campaign, etc. See Questionnaire Pre-testing.
Pre-Ticketing
the practice by a vendor of placing a tag on each product sold listing its particular style, size, colour, etc; the pre-ticketing is designed to make re-ordering easier for a reseller.
Predatory Pricing
a pricing practice by which a company hopes to inhibit or eliminate competition by charging lower than normal prices for its products in certain geographic regions.
Premium Pricing
see High-Price Strategy.
Premiums
a type of sales promotion in which merchandise is given free or at a reduced price to purchasers of products or visitors to a store.
Press Conference
a meeting to which media personnel are invited by a government body, organization or company seeking to make a public announcement, usually to gain favorable publicity or to offset some negative reaction.
Press Release
an announcement released to the news media by a government body, organization or firm, usually to obtain publicity or to offset some negative reaction to it or its products; also called a News Release.
Pressure Group
any group of individuals who work together to exert an influence upon the decision-making of a company to achieve some specific outcome.
Pressure Selling
see High Pressure Selling.
Prestige Builder
the highest-priced item in a product line. See Product Line; Traffic Builder.
Prestige Pricing
a pricing strategy in which prices are set at a high level, recognising that lower prices will inhibit sales rather than encourage them and that buyers will associate a high price for the product with superior quality; also called Image Pricing. See Psychological Pricing.
Prestige Products
items of superior quality; high status merchandise.
Price
the value agreed upon by the buyer and the seller in an exchange; one of the four controllable variables (with product, promotion and place) of the marketing mix. See Marketing Mix.
Price Adjustments
allowances, discounts, etc. granted by a seller to meet the requirements or circumstances of specific buyers.
Price Band
the range within which a product can be priced as dictated by competitive intensity and the perceived value of the product to consumers.
Price Brand
see Fighting Brand.
Price Bundling
a pricing strategy in which various products sold to a customer together are offered at a price less than the sum of the prices of the products sold individually.
Price Ceiling
A price, usually imposed by law, above which market prices are not permitted to rise; also called a Ceiling Price. See Price Floor.
Price Competition
a competitive situation in which price is used as the major means of differentiating the product of one firm from that of a rival. See Non-price Competition.
Price Cycle
the regular, periodic fluctuation in the price of a product, especially of an agricultural product, owing to expansion or contraction in its supply.
Price Discounting
see Discount.
Price Discrimination
a pricing strategy, generally illegal, in which a seller charges different prices to marketing intermediaries for the same product. See Differential Pricing.
Price-Elastic Segments
segments of the market which are more responsive to price changes than other segments of the market. See Price Elasticity.
Price Elasticity
buyers' sensitivity to price; measured by the percentage change in quantity demanded that results from a percentage change in price. See Price In-elasticity.
Price Fixing
agreement or collusion between competitors to maintain certain fixed price levels to avoid competition. See Horizontal Price Fixing; Vertical Price Fixing.
Price Floor
A price, usually imposed by law, below which market prices are not permitted to floor; also called a Floor Price. See Price Ceiling.
Price Gouging
a monopolistic pricing technique in which the seller takes advantage of the lack of competition by charging unusually high prices relative to a product's cost.
Price Incentives
a common form of sales promotion in which price reductions are offered to consumers to encourage them to buy a particular product earlier or in larger quantity.
Price In-elasticity
buyers' insensitivity to price; when the percentage change in quantity demanded is less than the percentage change in price, consumers are price-insensitive. See Price Elasticity.
Price Leader
a firm whose prices set a lead for other firms in the industry to follow.
Price Leadership
a situation which occurs when one or a few companies, usually larger companies, are consistently the first to institute price changes.
Price Lining
pricing different products in a product line at various price points, depending on size and features, to make them affordable to a wider range of customers.
Price Objection
an objection raised by a prospective buyer on the grounds of price, credit terms, discounts, allowances, freight charges, etc. related to the cost of a product offered by a salesperson.
Price Packs
a type of sales promotion in which consumers are offered a reduction in the regular price of a product; the amount of the reduction is usually marked, or "flagged", prominently on the label or package; also called a "cents-off" deal.
Price Sensitivity
see Price Elasticity.
Price Space
the price difference between items in a product line; having the right amount of price space is often critical as too little space may confuse buyers and too much space may leave gaps which can be exploited by competitors. See Product Line.
Price-Taker
any firm which is unable to influence the general level of commodity prices by altering the quantity of the product produced; a firm operating in a perfectly competitive market situation is, necessarily, a price-taker. Price-takers are sometimes also referred to as Quantity Adjusters as their chief decision is to adjust the amount they produce to a given price. See Perfect Competition.
Price Wars
a conflict situation likely to occur in industries where products cannot be greatly differentiated; a decrease in price by one company will attract a large number of customers to it, forcing other companies to retaliate by cutting the price even further.
Price-Value Relationship
the connection that consumers make between price and quality; products with a higher price are commonly perceived to be of better quality.
Pricing
marketing activity concerned with the setting of prices for new products and the adjustment of prices for existing products.
Pricing Strategy
the element of a firm's decision-making concerned with the setting of prices that will attract the target market and allow profit objectives to be met.
Primary Advertising
advertising intended to create demand for a class or category of product rather than for a brand. See Generic Advertising; Pioneering Advertising.
Primary Data
information that is obtained directly from first-hand sources by means of surveys, observation or experimentation. See Secondary Data.
Primary Demand
demand for a product class rather than for a particular brand within the class.
Primary Packaging
a product's immediate container or wrapper. See Secondary Packaging; Shipping Packaging.
Principle of Integrating Interests
a technique used in selling in which the salesperson, knowing the buyer's personal interests or buying motives, places emphasis on these in the presentation rather than on the features or benefits of the product.
Print Campaign
Private Brand
a brand owned by a wholesaler or retailer; also called a private label. See Manufacturer's Brand.
Private Carrier
any form of transport operated by an independent organization and used for the shipment of goods. See Common Carrier; Contract Carrier
Private Label
see Private Brand.
Private Treaty
a market agreement arranged by a buyer and seller in private negotiation.
Privatization
Proactive Marketing Strategies
marketing activities which anticipate competitive action and attempt to forestall it; offensive strategies. See Reactive Marketing Strategies.
Probabilistic Models
a statistical tool in which the probability that an event will occur again is estimated using historical data; for example, in sales forecasting past purchasing behavior is used to estimate the degree of probability with which consumers will purchase the same item again.
Probability Sample
a sample in which each individual within a total population has a known chance of being chosen.
Problem Children
see Question Marks.
Problem Situation Model
a model of a problem situation faced by a decision-maker, constructed (often by a marketing researcher) in order to get as clear a picture as possible of the problem; a problem situation model includes a description of the desired outcomes, the relevant variables, and the relationships of each of the variables to the outcomes.
Problem-Solving Approach
an approach to selling in which the salesperson works with the buyer to evaluate alternative solutions to a problem and to select the best; a consultative approach intended to build long-term relationships with clients. Also called Depth Selling.
Process Materials
a classification of goods bought by organizations for incorporation into a product; the process materials cannot be recognized in the finished product.
Procurement Costs
the costs involved in reordering an inventory item; the costs include the cost of processing and transmitting the order as well as the cost of the item itself.
Product
a bundle of need-satisfying tangible and intangible attributes offered to a buyer by a seller. See Actual Product; Augmented Product; Core Product.
Product Advertising
advertising in which a company promotes a particular good or service.
Product Attributes
distinctive tangible and intangible features of a product that give it its value to a user.
Product Audit
a systematic appraisal of a firm's product mix to evaluate its strengths and weaknesses and to assess the available opportunities.
Product Category
the specific generic to which a good or service belongs; for example, while Fanta is a brand name, the product category to which it belongs is soft drinks.
Product Concept
see Product Orientation.
Product Depth (of Line)
see Product Line Length.
Product Development
a growth strategy in which the firm develops new products for existing markets.
Product-Differentiated Marketing
a marketing philosophy in which the seller views the market as a homogeneous whole, but produces two or more products for it; the products, differing in attributes (price, style, quality, etc), are designed to offer variety rather than to satisfy the needs and wants of different market segments. See Mass Marketing; Target Marketing.
Product Differentiation
a strategy which attempts (through innovative design, packaging, positioning, etc.) to make a clear distinction between products serving the same market segment.
Product Differentiation Advantage
Product Elimination
the decision to drop a product (for example, in the decline stage of its life cycle) in order to use the costs associated with it to enhance profits or to release resources that could be more effectively used in other ways.
Product Extension
the introduction of a product that is known to the company but which has features or dimensions which are new to consumers; three types of product extensions are possible: revisions, additions and repositionings. See Innovation; New Product Duplication.
Product Failure
a product that does not meet management expectations in the marketplace.
Product Flanking
a competitive marketing strategy in which a company produces its brands in a variety of sizes and styles to gain shelf space and inhibit competitors.
Product Form Competitors
firms offering slightly different variants of the same basic product.
Product Item
a product variant with its own distinctive attributes (price, packaging, etc.); also called a Stock-Keeping Unit and a Stock-Taking Unit.
Product Knowledge
detailed knowledge of a product's features and benefits required by a salesperson to persuade a prospect to purchase.
Product Leveraging
see Brand Leveraging.
Product Liability
the onus or responsibility imposed by legislation on a manufacturer to warn consumers appropriately about possible harmful effects of a product, to foresee how it might be misused, etc.
Product Life Cycle
a concept which draws an analogy between the span of a human life and that of a product, suggesting that, typically, a product's life consists of four stages - introductory, growth, maturity and decline; the concept is used as a tool to formulate marketing strategies appropriate to each of the stages.
Product Line
a group of products manufactured or distributed by an organisation, similar in the way they produced or marketed; for example, Gillette markets a line of razors and blades, a line of toiletries, a line of pens and a line of cigarette lighters.
Product Line Brand Name
a brand name applied to several products within a product line. See Product Line; Individual Brand Name; Family Brand; Corporate Branding.
Product Line Expansion Segmentation Strategy
one of four possible segmentation strategies (with concentrated segmentation strategy, market segment expansion strategy and differentiated segmentation strategy) available to a firm in relation to the segment or segments it wishes to target; in a product line expansion segmentation approach a firm offers several products to one segment. See Segmentation Strategies; Concentrated Segmentation Strategy; Market Segment Expansion Strategy; Differentiated Segmentation Strategy.
Product Line Extension
adding depth to an existing product line by introducing new products in the same product category; product line extensions give customers greater choice and help to protect the firm from a flanking attack by a competitor. See Product Line; Product Line Depth; Product Line Stretching.
Product Line Featuring
a strategy in which certain items in a product line are given special promotional attention, either to boost interest (at the lower end of the line) or image (at the upper end). See Product Line.
Product Line Filling
introducing new products into a product line at about the same price as existing products. See Product Line.
Product Line Length
the number of different products in a product line. See Product Line.
Product Line Manager
see Category Manager.
Product Line Modernization
a strategy in which items in a product line are modified to suit modern styling and tastes and re-launched. See Product Line.
Product Line Pruning
reducing the depth of a product line by deleting less profitable offerings in a particular product category. See Product Line.
Product Line Retrenchment
reducing the width of a product mix by decreasing the diversity of items offered across product categories; product line retrenchment is common following the failure of brand leveraging to launch a brand into a related category. See Product Line; Product Mix Width.
Product Line Stretching
introducing new products into a product line. See Product Line; Downward Stretching; Two-way Stretching; Upward Stretching.
Product Management System
a system which ensures that total marketing control of a product line or brand rests with the person who has profit responsibility for it.
Product Manager
an individual given responsibility for the planning and co-ordinating of a firm's marketing activities related to a single product, product line or market.
Product Mix
the variety of distinct product lines and items manufactured or distributed by an organization. See Product Item; Product Line.
Product Mix Consistency
the degree of closeness or relatedness between product lines in the product mix. See Product Line; Product Mix.
Product Mix Width
the number of distinct product lines manufactured or distributed by an organization. See Product Line; Product Mix.
Product Modification
any substantial change made to the attributes (size, shape, color, style, price, etc.) of a product; modification of a product is usually undertaken in an attempt to revitalize it in order to increase demand.
Product Objection
an objection by a prospective buyer to the quality or characteristics of the goods offered by a salesperson. See Objections.
Product Organization
the deployment of a firm's sales force or the organization of its marketing activities so that a separate division is responsible for each of its major products or product groups. See Organizational Structure.
Product Orientation
a management philosophy, concept, focus or state of mind which emphasis's the quality of the product rather than the needs and wants of the target market; the orientation assumes that consumers will favour products that offer the most quality, performance and features and that the organisation's objectives will be most readily achieved by a concentration on these.
Product Petrification
a term used to describe the small but persistent demand by loyal customers for a declining product. See Product Life Cycle; Decline Stage.
Product Portfolio
the mix of products manufactured or distributed by a company. See Product Mix; Product Mix Width.
Product Portfolio Analysis
an examination of each of the products manufactured or distributed by the company to assess future marketing strategies. See Boston Consulting Group Portfolio Analysis Matrix.
Product Position Map
a tool used in comparing consumer perception of the differences between products or brands; consumers are asked to mark the particular location of a product or barnd on a two-dimensional "map", where the axes of the map are attributes felt by consumers to be important. See Perceptual Mapping.
Product Positioning
see Market Positioning.
Product Positioning Strategy
marketing decisions and actions intended to create a particular place for a product in the market and in the minds of consumers; a product positioning strategy may attempt to differentiate a marketing offer from a competitor's or to appear similar to it.
Product Recall
the advertised request by a company that a product be returned to it by those who have already purchased it; a product recall is often deemed desirable when a product proves to be unsafe or unreliable.
Product Strategy
the element of a firm's decision-making concerned with developing the most appropriate products for its target market.
Product Testing
exposing consumers to a new product, in final or prototype form, so that they might compare it to their usual brand and rate it; the results of product testing will indicate to the company whether further evaluation of the product in test markets is desirable. See Concept Development and Testing; New Product Development.
Product Variant
see Product Item.
Product Warranty
see Warranty; Express Warranty; Implied Warranty.
Product-Based Competitors
see Product Form Competitors.
Product-Based Marketing Organisation
a marketing structure of an organisation in which staff specialists have responsibility for various products of the organisation (rather than for particular markets); most appropriate when customer needs are differentiated by product. See Market-Based Marketing Organisation.
Product-Differentiated Marketing
an approach to marketing in which a company disregards market segmentation but produces goods and services that are different from others on the market.
Product-Push Approach
an approach to the generation of new product ideas in which a company's strengths rather than market needs are given prime emphasis. See Demand-Pull Approach.
Production Goods
a classification of industrial goods; goods purchased by industrial firms for use in the manufacture of their finished products. See Industrial Product Classes.
Production Orientation
a management philosophy, concept, focus or state of mind which emphasises production techniques and unit-cost reduction rather than the needs and wants of the target market; the orientation assumes that consumers will favour those products that are the most readily available and at the most affordable prices and that a concentration on efficiencies in production and distribution will most readily achieve the firm's objectives.
Profit and Loss Statement
an accounting statement showing income, expenditure and profit over a given period.
Profit Centre
a division of an organisation with responsibility for generating its own income, and with accountability for profits.
Profit Maximisation
see Current Profit Maximisation.
Profit Objective in Pricing
setting prices with short-run profits rather than long-term market share in mind.
Profit Sharing
a compensation system in which employees are awarded a share of the company's profits to encourage increased productivity.
Profitability Control
marketing effort intended to assess the level of profitability of each product in the portfolio, of each market segment, of each marketing channel, etc.
Progressive Commission
a sales commission system in which the commission rate increases as the salesperson sells more goods. See Regressive Commission.
Promotion
one of the four controllable variables (with product, price and place) of the marketing mix.
Promotion Manager
an individual within an organisation responsible for promotional activities and campaigns.
Promotion Mix
the range of means available to an organisation for communication with its target market - advertising, sales promotion, personal selling, publicity and public relations.
Promotional Adaptation
a strategy in which the same product is sold in different geographic locations but with a unique promotional strategy for some or all of the different locations.
Promotional Allowance
a price reduction or discount granted by a manufacturer to a member of the marketing channel in return for some form of special promotion of a particular product.
Promotional Budget
the sum allocated in a particular accounting period for expenditure on promotion.
Promotional Campaign
a coordinated series of promotional efforts built around a single theme and designed to achieve a specific objective.
Promotional Partnership
an alliance between a manufacturer of a product and another company for the purposes of promotion; for example, Coca-Cola Co. may form a promotional partnership with 20th Century Fox Film Corp., agreeing to pay that company to display the soft drink prominently in a forthcoming feature film. See Movie Tie-Ins; Entertainment Marketing.
Promotional Pricing
the temporary pricing of goods and services at lower than normal levels for a special promotional effort.
Promotional Stock
merchandise offered at a reduced price to a reseller for some special promotion or festive occasion; also referred to as Seasonal Stock.
Promotional Strategy
the element of a firm's decision-making concerned with choosing the most appropriate mix of advertising, sales promotion, personal selling and publicity for communication with its target market.
Promotional Warranty
a warranty designed to reduce the perceived financial or performance risk that a consumer might perceive in purchasing an expensive product. See Warranty; Express Warranty; Implied Warranty; Protective Warranty.
Prospect
a potential customer. See Sales Leads; Suspect.
Prospecting
the first step in the selling process; the activity of seeking out potential customers. See Sales Leads.
Prospecting Plan
a systematic approach to finding new customers involving the setting aside of time after allowing for calls on existing customers specifically for prospecting.
Protectionism
Trade policies of governments aimed at protecting domestic industries by limiting the volume of imports.
Protective Warranty
see Warranty; Express Warranty; Implied Warranty; Promotional Warranty.
Prototype
a sample or early version of a new product made or built specifically for trialling and testing.
Prototype Testing
the trialling of a sample of a newly developed product on selection of customers from the target market .
Proxemic Communication
a form of nonverbal communication or body language in which messages are conveyed from one person to another by the changing space that separates them during a conversation. See Kinesic Communication; Nonverbal Communication; Tactile Communication.
Psychodrama
a qualitative marketing research technique in which respondents are asked to engage in impromptu role-playing exercises intended to have them reveal their feelings about certain products or brands. See Qualitative Marketing Research.
Psychodrawing
a nonverbal, qualitative marketing research technique in which respondents use colours, shapes, symbols, etc. to express their feelings about certain products or brands. See Qualitative Marketing Research.
Psychographic Segmentation
the division of a heterogeneous market into relatively homogeneous groups on the basis of their attitudes, beliefs, opinions, personalities and lifestyles; sometimes called "State-of-Mind" Segmentation.
Psychography
the study of the attitudes, beliefs, opinions, personalities and lifestyles of individuals in a population.
Psychological Discounting
the advertising of a product at a heavily reduced price, as in "Was $49.95, now only $35.00"; the practice may be illegal under the Trade Practices Act unless the reduction is a genuine one.
Psychological Needs
innate human feelings of deprivation related to an individual's mental well-being. See Needs; Physiological Needs.
Psychological Repositioning
the attempt by a firm to alter the beliefs of prospective buyers about the key attributes of its product offering, especially where the buyers generally underestimate its quality. See Market Positioning; Real Positioning; Repositioning; Competitive Depositioning.
Psychological Pricing
pricing intended to influence the customers' perception of the actual price of a product; two common forms of psychological pricing are odd pricing and prestige pricing. See Odd Pricing; Prestige Pricing.
Psychological Risk
see Risk; Emotional Risk.
Psychological Set
a consumer's mind set; his or her positive or negative feelings or predispositions towards a particular brand or company. The consumer's mind set is formed by his or her needs, perceptions and attitudes. See Attitudes; Needs; Perception.
Public Policy Environment
that part of a firm's external environment which consists of controversial issues or matters of concern to governments, the media or influential pressure groups; factors in this environment may have an influence on a firm's decision-making or an impact upon its performance.
Public Relations
the relationship which exists between an organisation and its several publics; efforts to influence this relationship by obtaining favourable publicity.
Publicity
corporate or product promotion that is obtained free of charge.
Publics
the various groups in a society which can influence or bring pressure to bear upon a firm's decision making and have an impact upon its marketing performance; these groups include the financial public, media public, government public, citizen action public, local public, general public and international public.
Puffing
the legitimate practice of making obviously exaggerated claims in advertising, eg. "cleaner than clean".
Pull Strategy
promotion to end-users (mainly by means of advertising, sales promotion and publicity) rather than to members of the marketing channel (mainly by personal selling) to facilitate the flow of a good or service from producer to final consumer. See Push Strategy; Push-Pull Strategy.
Pulsing
scheduling advertising campaigns in fairly regular bursts followed by periods of relative or complete inactivity. See Continuity; Flighting.
Puppy Dog Close
a closing technique in which a salesperson urges an indecisive prospect to "take it home, play with it overnight", believing that once the product is in the customer's keeping he or she will be unwilling to part with it.
Purchase Allowance
see Off-Invoice Allowance.
Purchase Intentions
the likelihood that a consumer will buy a particular product resulting from the interaction of his or her need for it, attitude towards it and perceptions of it and of the company which produces it.
Purchase Laboratory
See Accelerated Test Marketing.
Purchase Probability Scale
a tool used in marketing research surveys of buying intentions; respondents are asked to rate the likelihood of their purchase of a particular product on a scale ranging, for example, from "definitely not" to "certain to buy".
Purchasing Officer
an individual within an organisation responsible for purchasing the goods and services it requires. See Buying Centre.
Purchasing Performance Evaluation
the establishment of criteria by which the performance of purchasing officers can be assessed and of incentive systems so that good purchasing can be rewarded.
Pure Competition
a marketing situation in which there are a large number of sellers of a product which cannot be differentiated and, thus, no one firm has a significant influence on price. Other prevailing conditions are ease of entry of new firms into the market and perfect market information. Also referred to as Perfect Competition and Atomistic Competition. See Monopolistic Competition.
Pure Monopoly
a marketing situation in which there is only one seller of a product. See Pure Competition.
Push Money
a direct payment of money offered to the sales force of a reseller by a manufacturer to encourage greater efforts with a particular product or range.
Push Strategy
promotion to members of the marketing channel (mainly by means of personal selling) rather than promotion to end-users (mainly by means of advertising, sales promotion and publicity) to facilitate the flow of a good or service from producer to final consumer. See Pull Strategy; Push-Pull Strategy.
Push-Pull Strategy
promotion of a good or service both to end-users and members of the marketing channel to facilitate its flow from producer to final consumer. See Pull Strategy; Push Strategy.
Pyramid Selling
a selling system, now illegal in Australia, in which members of a sales organisation derive their earnings by selling to newly introduced members of the distribution network (who pay a fee to enter) rather than to end-users.
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