A
Acquisition Cost - The total cost incurred by a business to acquire a new customer. This includes marketing and advertising expenses, sales incentives, discounts, and other related costs. It is calculated by dividing Total Acquisition Costs by the number of new customers acquired over a specified period. Acquisition cost can also refer to the expenses associated with acquiring assets after adjusting for discounts and incidental charges.
Advertising - The practice of creating and distributing paid messages designed to promote products, services, or brand awareness through various channels like television, radio, print media, digital platforms, and outdoor billboards. Effective advertising strategies engage potential customers and communicate a brand’s value proposition.
Affiliate Marketing - A performance-based marketing strategy where businesses reward external partners (affiliates) for generating traffic or sales through the affiliate’s marketing efforts. This often involves pay-per-click (PPC), pay-per-lead (PPL), or pay-per-sale (PPS) models.
Analytics - The systematic analysis of data to measure and improve business processes, marketing strategies, and customer behavior. Web analytics, sales analytics, and marketing analytics help businesses optimize their operations and decision-making.
Audience Segmentation - The practice of dividing a broad consumer or business market, normally consisting of existing and potential customers, into sub-groups of consumers based on some type of shared characteristics, such as demographics, interests, needs, or behaviors.
B
Benchmark - A standard or reference point used to measure the performance of products, services, processes, or business operations. Benchmarking involves comparing against best-in-class competitors or global standards to identify opportunities for improvement.
Branding - The process of creating a unique identity for a product, service, or company through a combination of visual elements, messaging, and customer experience. Effective branding differentiates a business from its competitors and builds loyalty with its target audience.
Brand Equity - The value derived from consumer perception of a brand. Strong brand equity often leads to customer loyalty, higher price points, and improved market positioning. It is cultivated through consistent positive customer experiences and effective branding strategies.
Brand Recognition - The ability of consumers to identify a brand based on visual or verbal cues, such as logos, slogans, or colors. High brand recognition typically correlates with increased consumer trust and product preference.
B2B (Business to Business) - A business model where companies sell products or services directly to other businesses, rather than to consumers. This includes wholesale distribution, corporate software, professional services, and industrial products.
C
Click-Through Rate (CTR) - A metric used to measure the effectiveness of an online advertising campaign. It calculates the percentage of users who click on an ad after viewing it. A high CTR indicates that the ad is compelling and relevant to the target audience.
Co-Branding (Brand Partnership) - A strategic collaboration between two or more brands to leverage each other’s strengths, increase credibility, and reach new customer segments. An example is the partnership between Nike and Apple for the Nike Training app.
Collateral - Marketing materials such as brochures, flyers, case studies, press releases, and digital assets used to support sales efforts and communicate a company’s brand, products, and services.
Competitive Advantage - A unique edge that a business has over its competitors, which allows it to outperform rivals in terms of profitability, customer satisfaction, or market share. This could be based on cost leadership, product differentiation, or superior customer service.
Conversion Rate - A key performance indicator (KPI) used to measure the percentage of users who complete a desired action, such as making a purchase or signing up for a newsletter, in relation to the total number of visitors or leads.
D
Direct Mail Marketing - A marketing strategy that involves sending physical promotional materials (such as brochures, catalogs, or postcards) to potential customers through postal services. It can be an effective way to generate leads and drive conversions when targeted correctly.
Direct Marketing - A form of marketing where businesses communicate directly with consumers, often via channels like email, phone calls, text messaging, or direct mail. This approach encourages immediate responses and fosters a one-to-one relationship between the company and the customer.
Diversification - A growth strategy where a business expands into new markets or adds new products or services to its portfolio to reduce reliance on its current offerings and mitigate risks associated with market changes.
E
Email Marketing - A digital marketing strategy that involves sending emails to a list of contacts with the goal of promoting products, services, or updates. It’s a cost-effective way to nurture relationships with customers and drive conversions, but must comply with regulations like GDPR and the CAN-SPAM Act.
Engagement Rate - A metric that measures the level of interaction a customer has with content or ads. It can include likes, comments, shares, or clicks, and is an important indicator of content relevance and audience interest.
E-commerce - The process of buying and selling goods or services over the internet. E-commerce businesses often rely on digital marketing strategies to attract customers, drive traffic to their websites, and convert visits into sales.
F
Focus Group - A research method where a small group of people representing a target market provides feedback on a product, service, or marketing campaign. This qualitative method helps businesses understand consumer perceptions and preferences.
Freemium Model - A business model that offers basic services for free while charging a premium for advanced features or additional functionality. Popular in software and app-based businesses, this model helps attract a large user base that can later be converted into paying customers.
G
Goodwill - The intangible value associated with a business’s brand, reputation, and customer relationships. Goodwill can add significant value to a business during mergers or acquisitions.
Green Marketing - The practice of promoting products or services that are environmentally friendly or sustainable. Companies use green marketing to appeal to eco-conscious consumers, though they must ensure their claims are backed by actual environmental benefits.
Guerrilla Marketing - An unconventional and cost-effective marketing strategy that uses surprise, creativity, and ingenuity to engage customers and make a lasting impression. Guerrilla marketing often relies on word-of-mouth, viral content, and public stunts.
H
HubSpot Marketing - Refers to the suite of marketing tools offered by HubSpot, a platform that includes customer relationship management (CRM), email marketing, automation, analytics, and more, designed to help businesses grow and scale effectively.
I
Impression - Also known as a ‘page impression’ or ‘page view’, it is a measurement used in search engine marketing to determine how many times a particular page is viewed by internet visitors. A high number of Impressions per visitor indicates they are viewing many pages and the site is therefore interesting or useful. Advertising is frequently bought based on the number of impressions a website receives.
Internet Marketing - Also known as ‘e-marketing’ or ‘online marketing, it encompasses all marketing activities which take place in an online environment. With the strong growth of the internet in recent years, this form of promotional activity has grown strongly and many predict that it will eventually become the dominant form of marketing worldwide. Specific activities include search engine optimisation, group buying sites like Groupon, online sales sites such as Kalahari.net, e-mail marketing, blogs as marketing tools, etc
L
Loyalty Programmes - A marketing strategy that encourages customer loyalty and repeats purchases of a product or regular usage of a service. Typically, customers will receive rewards like discounts, preferential deals, gifts or upgrades, depending on the number of points or credits that they accumulate. The company also benefits by being able to build a client database that includes profiles of their product preferences and buying habits.
M
Market Development Strategy - A structured plan to take existing products and services into new markets, or to expand demand within the existing client base. Strategies to achieve the former may include moving into a new geographic region or country, or marketing to a new demographic group within an existing region. Strategies to achieve the latter will include promoting innovative new uses for an existing product or service.
Market Cost Analysis - In an environment where costs are escalating dramatically, but marketers are unable to pass these on to cash-strapped customers, containing marketing and distribution expenditure has become a key management tool. A Marketing Cost Analysis is used to evaluate whether such costs within a business are being properly managed, and to determine how to further efficiencies can be achieved. Components that may be analysed include distribution costs; cost of holding stock; related staff costs; the cost of extending credit; promotional and advertising expenditure, etc.
Market Penetration Strategy - A company’s structured plan to increase its presence, or to dominate, in an existing market. Tactics to achieve this may include low pricing, discounts, product bundling, special offers, or increasing marketing and advertising expenditure. Similar to Market Development Strategy
Market Research - A systematic and objective marketing effort to gain knowledge about an organisation’s target audience and their likes, dislikes, opinions and attitudes. This may pertain to a particular product or service (planned or existing), or to broader issues around entire consumer sectors and society in general. In collecting and analysing this information, professional marketers may use Focus Groups, broad-based surveys, questionnaires, psychological investigations, online and offline observations, academic studies, etc.
Market Sales Potential - The maximum number of sales, or total share of a market, that a business can reasonably expect to capture under ideal conditions. Determining Market Sales Potential is an important part of a firm’s decision-making process when it comes to introducing new products or services or entering new markets.
Market Segmentation - Dividing a target market into segments that have common requirements, attitudes, disposable income, or other uniting characteristics which allow them to be simultaneously targeted by a single product, service or marketing strategy. Segments can be based on a wide variety of variables, including geography, demographics, or psychographics.
Marketing - Industry guru, Philip Kotler, defines it as: ‘The management process that identifies, anticipates and satisfies customer requirements profitably, while the Chartered Institute of Marketing in the United Kingdom describes Marketing as ‘the right product, in the right place, at the right time’. Modern-day marketing is frequently used as an all-encompassing term covering a variety of related disciplines such as market research, advertising, public relations, customer relationship marketing, etc.
Marketing Audit - A periodic and in-depth evaluation of an organisation’s marketing assets to determine whether they are being used effectively to achieve the designated objectives, and are in line with the overall marketing and business strategies. An audit will typically focus on three key areas: the external marketing environment; the internal marketing environment; and evaluation of the current marketing plan. Regular marketing audits are vital in a global social and business environment that is characterised by rapid and dramatic change.
Marketing Plan - A document that sets out an organisation’s strategies and tactics designed to achieve its marketing objectives in support of the overall Business Plan. Typically, it will cover a timeframe of one to five years and be a blueprint for the organisation’s interactions with, and understanding of, its target audiences. Among other things, the Marketing Plan may define the target audience, analyse competitors and their strategies, set out the organisation’s own communication activities, set pricing parameters, detail Loyalty Programmes and anticipate market change.
Mission Statement - A short statement that defines key elements such as an organisation’s reason for existing, its objectives, philosophy and the markets it intends to serve. It is typically a concise summary of the broader business strategy and serves as a compass for staff and management, as well as an important statement for customers, suppliers and the community at large.
Multi-level Marketing - A strategy used in the Direct Sales industry to encourage existing distributors to recruit new distributors. Should they do so, they receive a percentage of the recruit’s sales as an incentive. Distributors are typically part-time, commission-only workers. Amway and Justine cosmetics are good examples of Multi-Level Marketing. Not to be confused with so-called Pyramid Schemes, which are outlawed in many countries.
N
Niche Marketing - The opposite of Mass Marketing, it is a small subset of a broader market that has very specific requirements in terms of what it requires and the price it is willing to pay for that product or service. Current changes in society’s expectations and needs in terms of individuality indicate that once-size-fits-all strategies are giving way to products and services tailored to more individual (niche) needs.
O
P
Perceived Risk - The level of uncertainly experienced by consumers during the course of making the buying decision, particularly for big-ticket items (like cars) or complex products (such as life insurance). Consumers will frequently attempt to reduce this uncertainty by doing their own extensive research, consulting experts, or seeking advice from their peers. For their part, companies will try to allay fears by, for example, providing comprehensive warranties, implementing PR campaigns, or obtaining approval/endorsement from trusted bodies (eg: SABS accreditation; winning industry awards, etc).
Penetration Pricing Strategy - A marketing strategy aimed at achieving a high volume of sales and strong market penetration in a short space of time, typically for a new product or service. The hope is that the business will thus quickly achieve economies of scale and block entry to the market before competitors can effectively mobilise. Typical tactics of a Penetration Pricing Strategy include low pricing and very aggressive promotion.
Point-of-sale (POS) - it is the main computer linked by a network to several checkout terminals, usually in a retail environment. Using the information generated by the system, management can analyse shopping trends, identify peak and trough periods, track stock levels and generate new orders. The POS system can also typically be linked to credit card readers, receipt printers, cash tracking software and other electronic systems designed to track stock and cash flow. In marketing terms, point-of-sale refers to in-store promotional activities designed to target consumers at the point where they are making the buying decision. It often leads to impulse buying.
Premium - The amount at which a product or service is valued, over-and-above its intrinsic value. This will frequently be a result of a premium brand image generated by marketing and pricing strategies. For example, a Gucci-branded handbag will sell at a premium price versus an identical handbag without the Gucci label. In investment terms, Premium refers to the amount at which a securities option is traded. In Insurance terms, a Premium is an amount paid monthly (or at another agreed interval) to ensure a policy remains active.
Product Life Cycle - The period of time over which a product or service is conceived, developed, brought to market, reaches maturity and is eventually discontinued or becomes obsolete. A Product Life Cycle can vary from a few weeks or months (such as World Cup souvenirs) through to centuries (such as Coca-Cola). The stage of the lifecycle that a particular product/service is in, may have an impact on the way the product is marketed and its pricing.
Product Line - Also known as Product Range. It is related products and services offered by a single company to the marketplace. For example, automaker Toyota offers smaller and bigger cars, bakkies, mini-buses, light commercial vehicles and 4x4s to cater for as wide a range of customers as possible. Extending the Product Line is usually a good way for an established company or brand to leverage its good standing with consumers and expand into other areas. For example, Tag Heuer offers not just watches, but other lifestyle accessories such as eyewear and mobile phones
Profit Margin - A measure of how much out of every rand that a company keeps in earnings. Usually expressed as a percentage, it is Net Profit (see listing under ‘N’) divided by Sales. A higher profit margin typically indicates that a business has good control over its costs, or that it has established itself as a premium brand and can therefore increase its prices more than its competitors, while still offering a similar product.
Public Relations (PR) - The processes used to establish and promote a favourable relationship between an organisation and its target audiences. A common international definition used by Public Relations industry bodies is: ‘It is the planned and sustained effort to establish and maintain goodwill and mutual understanding between an organisation and its publics’. Public Relations is often confused with Media Relations, which is only a part of the broader PR function.
R
Retailer - An individual or organisation selling goods to consumers, as opposed to a wholesaler or a business-to-business supplier, which sells goods to other businesses – usually in bulk and sometimes at a discounted rate. The retailer will normally purchase from wholesalers, or direct from the manufacturer, and sell to consumers at a mark-up. The definition encompasses anything from a small neighbourhood ‘spaza’ shop to the likes of giant retailers like Checkers or Edgars.
S
Sales Break-Even (Break-Even Analysis) - It is a method of determining at what point a company’s financial situation is in equilibrium and it makes neither a profit nor a loss. In doing a Sales Break-Even analysis, management will typically calculate the volume of sales and/or income required to cover the costs associated with producing it. If sales/income is predicted to fall below this point, then the operation is deemed unviable or in need of further action, for example reducing the unit cost of producing the item.
Sales Forecast - A projection of likely sales revenue for a business, based on an analysis of market trends and broad economic trends, industry surveys, previous sales history, and input from the sales team and existing customers. It is a vital part of the management strategy of any business, as sales will normally be the main form of income and cash flow. Without an accurate Sales Forecast, a business cannot successfully plan for the future or determine the stock and assets which it needs to have in place, as well as the expenses which it may incur.
Sales on Credit (Credit Sales) - It is products and services sold on the understanding that payment will be made at a later, mutually agreeable, date. This may involve payment via a single lump sum – over 30 to 90 days, for example – or payment in instalments over a period that may last for several years. In the latter case, this will frequently involve an interest payment as well. The opposite of Cash Sales.
SMS Marketing - A form of Mobile Marketing that uses Short Message Service (SMS) text messaging on cellular phones to send promotional and advertising messages to consumers. The advantage for marketers is that it is cheap, can be highly targeted to a specific audience, and can be personalised to individual consumers. However, in South Africa, new consumer protection laws governing privacy and Direct Marketing make it increasingly difficult to use SMS Marketing effectively.
Social Media Marketing - The worldwide growth of Social Media, plus the fact that it is relatively inexpensive to use and can be highly targeted, has led marketers to develop marketing strategies aimed at leveraging social networks, online communities, forums, blogs etc as a means of reaching consumers and promoting the organisation’s message. One of the benefits, both for marketers and consumers, is that it allows for instantaneous interaction and feedback.
SWOT Analysis - A business tool, particularly common in strategic planning and marketing, which is used to assess Strengths, Weaknesses, Opportunities and Threats. It can be applied to the organisation as a whole, to specific products or services, or competitor organisations and their products and services. A SWOT Analysis helps a business to be objective about its own strengths and shortcomings, as well as those of its competitors – and to plan accordingly.
T
Target Market - That segment of the overall market to which a business wants to sell its products or services. Very few products are so generic as to be suitable to everyone, everywhere. Therefore, companies will identify more specific targets which may be segmented by age, gender, lifestyle, income, ethnicity, cultural or religious beliefs, geographical location, etc. Target Market also applies in the business-to-business environment where, for example, a manufacturer of surgical equipment for operating theatres would target surgeons and hospitals as likely customers.
Target Marketing - Marketing strategies and tactics aimed at that those specific segments of the market which the business has decided to target.
Telemarketing - The tactic of marketing to existing clients and potential customers by telephoning them to promote a product or service. As with other forms of Direct Marketing in South Africa, the effectiveness of Telemarketing is under threat from new consumer protection laws governing privacy.
U
USP (Unique Selling Proposition) – The distinct feature or characteristic that makes a product or service stand out from its competitors, offering a compelling reason why a customer should choose it over others. A strong USP is integral to a brand's identity.
Upselling – A sales technique where a seller encourages the customer to purchase a more expensive version of a product or an add-on to increase the overall value of the sale.
V
Value Proposition – The promise of value to be delivered to customers. It’s the primary reason a customer should buy from a company, highlighting the unique benefits that differentiate the product or service from others.
Viral Marketing – A marketing strategy that encourages individuals to share content (such as videos, social media posts, or messages) with others, resulting in rapid and exponential growth in brand awareness.
W
Word of Mouth (WOM) – A marketing strategy that relies on customers to spread information about a product or service to others, often considered one of the most powerful and credible forms of marketing.
Wholesaler – A business that sells goods in bulk to retailers or other businesses, typically at lower prices than those offered to the general public.
XYZ
Yield Management – A strategy used to optimize revenue by controlling the availability and price of a product or service, often seen in industries like travel and hospitality.
Zero-Based Budgeting (ZBB) – A budgeting method where all expenses must be justified for each new period, starting from zero. It’s a useful tool for companies seeking cost-efficiency.