CHAPTER 10
Glossary a g e n t An individual or legal entity authorized to act on behalf of another individual or legal entity (the principal). An agent’s authorized acts will bind the principal. A sales representative, for example, is an agent of the seller. association of south east asian n a t i o n s The economic and trade bloc founded in 1967 and comprised of Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Brunei. Acronym: ASEAN. b o t t o m l i n e That which a company calls “profit” after all has been said and done. In itself it is not a bad thing, but many in the corporate world consider the bottom line a sanctified litmus test of a company’s value. Problems arise when it’s seen as the sole indication of a company’s value. The true value of any company should be viewed by its viability to compete and serve its customers in the long term—not month to month or fiscal year to fiscal year. In other words, build a good company and well-served customers will continue to buy your product. b r a n d A name, term, design, symbol, or any other feature that identifies a seller’s goods or services as distinct from any offered by the competition. b r a n d e q u i t y The value a company derives from the fact that their product name is recognized and well-thought-of in the marketplace. b r a n d e x t e n s i o n The introduction of a new product or service by associating it in promotion with an already existing and well-established brand name. b r a n d l o y a l t y The degree to which a buying unit, such as a household, concentrates its purchases over time on a
particular brand within a particular product category. b r a n d r e p e t i t i o n The constant repetition of a brand name to consumers using different advertising media. breaking into a market The process of introducing a product into a new market. b r o k e r An individual or company that negotiates contracts with a third party on behalf of a principal. Typically a wholesale intermediary who facilitates sales. c h a n n e l The pathway and the intermediaries necessary for moving products from the producer to the seller. This may include distributors, agents, wholesalers, agents and retailers. c o - b r a n d i n g A strategy of building brand equity that combines two or more brand-name products or producers into a single new product, with the goal of benefiting from each brand’s reputation, (e.g., IBM computer with Intel Inside label). c o m m u n i c a t i o n The sharing of meaning. Five elements are necessary for communication to occur: source, message, receiver, and the processes of coding and encoding. comparative advantage (economics) An economic theory which holds that a company or nation should sell and export those goods or services that it produces more efficiently than other companies or nations and buy or import those goods or services that it produces less efficiently that other companies or nations. comparative advertising Advertising in which the marketer compares its brand to rival brands that are actually identified by brand name. c o m p e t i t i o n The rivalry among marketers who seek to satisfy the same markets.
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