9 Random Marketing Terms You Thought You Knew: A Cheat Sheet
Knowing (and remembering) the lingo of an industry can be difficult enough to make anyone’s head spin. The marketing and advertising industry is no exception to this rule; there’s so much jargon and terminology to keep anyone busy for years trying to memorize it all!
As someone who likes to keep cheat sheets nearby, I’ve found a couple marketing terms that I’m sure you knew about, but didn’t know exactly what they were called. Others, however, may be completely new.
I promise, there won’t be a quiz at the end of this blog.
Random Marketing/Advertising Terms to Remember:
Everywhere you turn you see your dream car? Your mind is playing tricks on you!
How many times have you noticed a new product for the first time, until all of a sudden you start seeing it everywhere? When you were looking to replace your current car and had your heart set on a specific make and model, did you start noticing a lot of them on the roads after that? You, my friend, have experienced Perceptual Vigilance. This occurs when you take notice of something (like that car you really want) and then you start to notice it everywhere around you. It’s one of those psychology terms that marketers want to understand better so they can use it to their advantage and better target consumers.
The two marketing terms that more often than not slip me up are Brand Identity and Brand Image. What’s the difference? A very, very slight one. Brand Identity dives into how companies want their consumers to perceive their product or brand. Brand Image, on the other hand is how consumers actually perceive your brand. Did you catch the difference? What a company thinks of their brand could be completely different than what consumers actually think of it. Think of Walmart. Their brand identity is to “save people money to help them live better.” Now, your brand image for them may differ from that. How do you perceive Walmart? Ask the person next to you — I bet their answer is different.
Keep your loyal customers happy and you’ll be sitting pretty
Anyone who works in an office knows about the 20/20/20 rule (oh, you don’t? Find out here). Here’s another rule that you may have heard about thrown around the office as well, the Eighty-Twenty Rule. For typical product categories, eighty percent of the products sold are consumed by twenty percent of customers. Seem confusing? Flip it around: twenty percent of all customers create eighty percent of the demand for your product. In the fast-food industry, for example, “heavy users” account for only one in five fast-food patrons, but they make up about sixty percent of all visits to fast-food restaurants. This twenty percent is where the majority of your revenue comes from, so be sure to keep them happy!
Losing a game is never fun, right? Well, in business, it can actually be a good thing. A Loss Leader is when a store or business advertises a very low price on a product in hopes of attracting customers to purchase other, more profitable merchandise while they’re visiting the store or website. Think of those Sunday ads in the newspaper. Let’s say Target is advertising t-shirts for $7.99, so you grab your car keys and head on over to stock up. While you’re there you notice that they have really nice jeans, so you try them on with your discounted shirts, and by George, you look fantastic! You came in for the eight-dollar t-shirts, but you’re walking out with two pairs of thirty-dollar jeans. Those t-shirts are a successful loss leader because you walked away spending more on the jeans unexpectedly.
“Why yes, I would like to also order those slacks in green. Great idea!”
If you work for a B2C company (a business that provides goods or services to customers) compared to a B2B company (where businesses sell to other businesses), then I’m sure you’ve heard all about Customer Relationship Management (CRM). But in the off-chance you were off that day or missed that meeting, here it is. A company uses CRM to track customer behavior for the sole purpose of developing marketing and relationship-building processes that will create a stronger relationship for the consumer to the brand.
Customer Relationship Management is not as creepy as it sounds — actually, it’s beneficial to all involved because it helps companies understand why customers are shopping with them and provides insight into what they can do in the future to get them back in their store or on their website to shop again. What brought you to them in the first place – from a friend’s recommendation, to purchase a specific item, or to redeem a coupon? What products do you typically buy that could give some insight on other possible products you’d be interested in? All these questions are answered with a successful CRM tool. Plus, having all your purchasing information handy (payment type, shipping address, billing address, etc) in one place makes check out a lot quicker!
The problem with a lot of business terms is that they’re always talked about with their shortened title, never the long-hand version. For example, hearing “KPI” for the first time would leave you scratching your head wondering what it meant, but hearing a Key Performance Indicator gives you a basic idea. A Key Performance Indicator is a “quantifiable measurement, agreed to beforehand, that reflect the critical success factors of an organization”. Just like no two organizations are the same, KPIs between companies are different — they will differ depending on the company. They help an organization outline and better measure progress toward their overall organizational goals.
Whether you’re in a department that deals closely with these marketing/advertising terms or you’ve just overheard the marketing nerds in your office talking about them, now you’ll have a handy way to remember what they mean. Not surprisingly, there’s a ton more random terms out there, so send them my way if you ever come across any!
Have you ever experienced perceptual vigilance in your life? Did a company advertising a loss leader work for you to buy other more expensive products as well? What are ways you wish companies could build a better customer relationship with you? Sound off below!
Image credit to Clipart.com and Hallicious.