Baby boom The increase in births that started in 1945, when World War II ended, and extended into the early 1960s. (Courtland L. Bovee, John V. Thill)

Backward invention Redesigning and producing a product for specific foreign markets after it is obsolete in industrialized countries. (Courtland L. Bovee, John V. Thill)

Balance of payments
Definition #1.Balance of payments is a record of all transactions between domestic residents and the rest of the world.
Definition #2. Balance of payments is the statistical accounting record of all of a country's external transactions in a given period.

The visible balance of trade: foods, fuels, materials, semi-manufactured and finished goods.

The invisible balance of trade: financial, travel, government transfers, overseas earnings.

The current balance = visible + invisible balances.

The capital account balance = short- and long-term capital movements.

The balancing item = adjustment for errors and inaccuracies

The balance for official financing = the `balance` necessary to/from reserves or borrowing.

Balance of trade A nation's total imports in relation to its total exports over a one-year period of time. (Courtland L. Bovee, John V. Thill)

Balance sheet is a statement of the financial position of an entity at a given date disclosing the assets, liabilities and accumulated funds such as shareholders' contributions and reserves, prepared to give a true and fair view of the financial state of the entity at that date.

Barter An exchange that is not based on monetary prices. (Courtland L. Bovee, John V. Thill)

Barriers to entry are economic or technical factors or costs that make it difficult for new firms to enter a market.

Basis of apportionment is a physical or financial unit used to apportion costs equitably to cost centers.

Basing-point pricing A form of delivered pricing that sets shipping charges based on delivery from one or more locations, even if the shipment never actually moved through those locations (Courtland L. Bovee, John V. Thill)

Bayesian decision theory This technique uses a decision tree to map out the alternative possible outcomes. Judgment is in reality part quantitative and part qualitative. The main limitation is that it is necessary to have some opinion as to likelihood of the different outcomes.

Behavioral models (Response hierarchy models) see Model.

Belief is a descriptive thought that a person holds about something.

Below-the-line promotions
Definition #1. Below-the-line promotions is all non-media promotion. (Christofer)
Definition #2. Below-the-line promotions is the supplementary selling activity which coordinates personal selling and advertising into effective persuasive force. (Engel et al)

See Pull strategy, Push strategy and Media.

Benchmarking Technique by which a company tries to emulate or exceed standards achieved or processes adopted by another company.

Benefit segmentation Benefit segmentation uses causal rather descriptive variables to group consumers. Different people buy the same or similar products for different reasons. Benefit segmentation bases on the idea that consumer could be grouped according to the principal benefit sought.
Use of different types of segmentation variables could lead to the conclusion that the main criterion for segmentation is the 'principal benefit sought'. Hence, although this approach acknowledges the fact that no single variable is likely to be of sufficient discriminatory power adequately to segment a market on its own, it regards the benefit sought as the main variable. (Geoff Lancaster and Lester Massingham)

The benefits which people are seeking is consuming a given product are the basic reasons for the existence of true market segments. (R.I.Haley)

Benefit sought See Benefit segmentation

Bibliography is a list of references or writings related to a particular topic and referred to by the author.

Black box models Models of consumer behavior in which the mind of the consumer is likened to a 'black box' which cannot be penetrated to find out what is inside. Such models focus on the input or stimulus (for example, advertising) and the response or output (purchase behavior).

Blocked currency A currency that cannot be redeemed in the world financial marketplace. (Courtland L. Bovee, John V. Thill)

Booklet is a format that involves a small and concise version of a larger text and may be presented in bound or leaflet form.

Boom see Business cycle

Boston classification / BCG matrix is a classification developed by the Boston Consulting Group to analyze products and businesses by market share and market growth. In this, cash cow refers to a product of business with high market share and low market growth, dog refers to one with a low market share and low growth, problem child (or question mark)has low market share and high growth and a star has high growth and high market share.

Boston matrix structure:
1) Stars are SBUs or products with high market share and high growth, i.e. leaders, but often needing a large cash investment in order to maintain growth in face of competition, which may offset cash generation.
2) Cash cows are typically former stars entering a period of low growth, still generating large amounts of cash but needing relatively little cash investment. Because of high market share over a period of years, cash cows enjoy economies of scale and high profit margins.
3) Dogs have low market shares in a low-growth market and tend to generate either a loss or a relatively low profit. They typically take up more management time than warranted and, unless they can be strategically justified, are candidates for withdrawal.
4) Problem children are sometimes alternatively labeled question marks, because, with a low share but high growth prospects, they need considerable investment for initially low returns. They are therefore cash users but potential stars. Management must choose between further speculative investment or withdrawal.

See also Direct product profitability.

Boutiques Agencies that employ creative specialists who offer design and copy writing services.

Boycott The refusal of a government or public groups and consumers to buy certain goods from another country. (Courtland L. Bovee, John V. Thill)

Brand is a name, term, symbol or design (or combination) which is intended to signify the goods or services of one seller or group of sellers and to differentiate them from those of competitors. Also, a particular makes of a product form.

Brand name refers strictly to letters, words or groups of words, which can be spoken.

Brand image distinguishes a company's product from competing products in the eye of the user.

Brand bases: 1) Differentiation (trough product offering, wide range), 2) Relevance (to the target market, value of money), 3) Esteem (brand association, shop value), 4) Knowledge (of the customer, unusual ethic products).

A successful brand (i) is and identifiable product, service, person or place; (ii) augmented so that the buyer or user perceives; (iii) relevant, unique, added values, which (iv) match the buyer's/user's needs closely.

See below Brand equity, Brand identity and Branding.

Brand equity includes discussion of creating measurable value for a brand name, often referred to as superbrands or power brands; also includes the measures of such value which includes rankings of most valuable brands, Return on Investment (ROI) for advertising spending or Brand awareness. (Responsive Database Services, Inc.)

Brand identity is the range of visual features, which assist in stipulating demand. There are name, image, typography, color, package design and slogans.

Brand loyalty The level of commitment that customers fee] toward a given brand, as represented by their continuing purchase of that brand. (Courtland L. Bovee, John V. Thill)

Brand mark That part of a brand which can be recognized but is not utter-able, such as a symbol, design, or dis-tinctive coloring or lettering. Examples are the Pillsbury doughboy, the Metro-Goldwyn-Mayer lion, and the red K on the Kodak film box. (Philip Kotler)

Branding incorporates values, image, awareness, recognition, quality, features, benefits and name amongst others. Branding is intangible values created by badge of reassurance.

Branding and product differentiation (Competitive strategies) are important means of increasing the inelasticity of demand curve, so justifying premium prices without substantial loss of sales.

The reasons for branding: 1. The form of product differentiation; 2. Advertising needs; 3. Audience acceptance; 4. Benefits in self-selection process; 5. Reducing of price differentials; Control over marketing strategy and channels of distribution.

Branding process and its benefits: 1. Basic product; 2. Investment in branding; 3. Sustainable advantage; 4. Market share increase; 5. Economies of scale; 6. Increased profitability; 7. Long term brand value.

Types of brand: 1. Individual brand (e.g. Bold, Tide); 2. Blanket family brand name for all products (e.g. Hoover, Heinz); 3. Separate family names for different product divisions (e.g. Kenmore and Kerrybrook); 4. The company trade name combined with an individual product name (e.g. Kellogg's - Corn Flakes, Rice Crispies etc.)

Branding strategies and its implies: 1. Family branding - the power of the 'family name' to introduce and market new products (e.g. Kellogg's, Heinz) - Image of the family brand across a range of products; 2. Brand extension - New flavor, sizes etc. (e.g. Mars, Snickers) - High consumer loyalty to existing brand; 3. Multi-branding - Different names for similar goods serving similar consumer tastes (e.g. Procter and Gamble, Unilever producing a large number of different brands) - Consumers make random purchases across brands.

Branding is relevant only those products (i) that can achieve mass sales because of high cost of branding and the subsequent advertising; (ii) whose attributes can be evaluated by consumers.
Examples of products for that branding is not appropriate: tap water, gas.

The advantages of branding: 1. Branding facilitates memory recall, thus contributing self-selection and improving customer loyalty; 2. Branding is a way of obtaining legal protection for product features; 3. Branding helps with market segmentation; 4. Branding helps build a strong and positive image, especially if the brand name used is the company name; 5. Branding makes is easier to link advertising to other marketing communication programs; 6. Display space is more easily obtained and point-of-sale promotions are more practicable; 7. If branding is successful, other associated products can be introduced; 8. The need for expensive personal selling/persuasion may be reduced.

The benefits of long-term brand investment: 1. The customer believe in the efficacy of the brand; 2. The strong association of the brand with well-known names (e.g. sports people); 3. Cumulative building of the brand owner's reputation; 4. The ability to launch new products as extensions of the brand; 5. The development of a brand personality.

Successful brand development strategy's cycle: 1. Invest in new brand; 2. Consumer communication strategy building awareness of product/product attributes; 2. Develop sales incentive program, trade promotions, merchandising and point of sale to support the brand; 3. Consumer choice, brand recognition, customer demand for the brand; 4. Retailer list the brand; 5. Wider distribution network build up; 6. Brand 'franchise' strengthened; 7. Brand sales grow, retailer concentration for the brand; 8. Increases sales, cost efficiencies, volume building, improved profits; 1. Invest in new brand; 2. ...

The ways of measuring the brand's value are based on the results of increasing prices, sales or profits arising from branding:
A. Brand Asset Valuator of Young and Rubicam: 1.1 Differentiation (How distinctive the brand?), 1.2 Relevance (What personal relevance for the respondent?), 1.3 Esteem (Is the brand held in high regard?) and 1.4 Knowledge (What a brand stand for?);
B. Power Grid Young and Rubicam is the matrix 2x2, The axes are: 2.1 Brand statue = Differentiation x Relevance and 2.2 Brand strength = Esteem x Knowledge;
C. The Brand Equity Ten of David A. Aaker: (i) Loyalty measures: 1. Price premium, 2. Satisfaction; (ii) Leadership measures: 3. Perceived quality, 4. Popularity; (iii) Differential measures: 5. Perceived value, 6. Brand personality, 7. Organizational associations; (iv) Awareness measures - 8. Brand awareness; (v) Market measures: 9. Market share, 10. Market price.

Seven factors of the strength of a brand (Guilding and Moorehouse): 1. Market share and leadership (domination in its sector); 2. Market (growth characteristics); 3. Stability (consumer loyalty); 3. Trend (a brand's ability to sustain itself); 4. Support (marketing expenditure and its quality); 5. Protection (patent, copyright, imitation etc.); 6. Internationality (brand spread).

Strategic aspects of brand valuation of Guilding and Moorehouse: 1. Authorization - justifying marketing expenditures; 2. Forecasting/Planning - budgeting and setting objectives; 3. Communication and coordination - internal marketing benefits; 4. Motivation; 5. Performance evaluation.

Break-even analysis (cost / volume / profit (CVP) analysis) is the study of the interrelationships between costs, volume and profit at various levels of activity. Breakeven analysis is concerned with the relationship between cost, volume and profit and in particular the level of activity at which total costs are exactly equal to revenue - the point which the business is said to be 'breaking even'.

Purposes of break-even analysis: 1) to provide information to management about cost behavior for routine planning and 'one-off' decision making, 2) to determine what volume of sales is needed at any given budgeted sales price in order to break even, 3) to identify the 'risk' in the budget by measuring the margin safety, 4) to calculate the effects on profit of changes in variable costs, C/S ratios, sales price and volume, product mix, and so on.

The major assumptions of break-even analysis are as follows: 1. Sales prices are assumed to be constant. 2. Fixed costs are assumed to remain fixed. 3. Break-even calculation only holds for circumstances where efficiency remains constant, notwithstanding increased productivity. 4. Since direct relationship between purchases and sales, then all that is manufactured is sold. 5. All cost are either fixed or variable. 6. The sales mix will be maintained in the same proportions.

Break-even chart is a chart which indicates approximate profit or loss at different levels of sales volume within a limited range.

Break-even point is the level of activity at which there is neither profit nor loss .

Breakeven pricing (target profit pricing) Setting price to break even on the costs of making and marketing a product, or to make the desired profit. (Philip Kotler)

Brief is a concise and short statement of points pertinent to the topic in question. Bullet points are a list of key concise factors relevant to the subject under discussion.

British Standards Institute is a quango-established to set product safety/quality standards.

Broker A wholesaler who does not take title to goods and whose function is to bring buyers and sellers together and assist in negotiation. (Philip Kotler)

BS EN ISO 9000 is a standard of quality assurance (formerly BS 5750).

BS5750 is a standard of environmental management systems.

Definition #1. Budget represents a specific quantitative goal that is set as an objective for a company or department, reflecting a management plan or part thereof.
Definition #2. Budget is a plan expressed in money. It is prepared and approved prior to the budget period and may show income, expenditure, and the capital to be employed. May be drawn up showing incremental effects on former budgeted or actual figures, or be compiled by zero-based budgeting.

Purposes of a marketing budget :
1. To set targets to be achieved; 2. To put within a financial and time frameworks all the planned events, expenditures and revenues for the following period. 3. To control these activities on regular basis to ensure they are keeping to budget levels 4. To motivate staff as they are in control of their own budget; 5. To devolve responsibility and allow managers to take responsibility for their actions; 6. To communicate objectives 7. To motivate and stimulate the staff; 8. To increase Co-ordination all business units, between all departments and between all staff. 9. To increase co-operation between all business units, between all departments.

Three types of annual budget planning: 1) Top-down planning (setting goals by top management); 2) Bottom-up planning (setting goals by employees); 3) 'Goals down - plans up'.

Preparation of departmental budget :
1. Information gathering: 1.1 Internal information (Sources: (i) control and monitoring reports, (ii) informal sources (discussions and meetings), etc.): 1.1.1 Marketing and sale information, e.g. revenue performance; 1.1.2 Production and operational information, e.g. production capacity; 1.1.3 Research and development information, e.g. new product launches; 1.1.4 Personnel information, e.g. anticipated salary increases for departmental staff; 1.2 External information (Sources: (i) trade associations, (ii) government statistics and reports, (iii) market research (discussions and meetings), etc.): 1.2.1 Market and competitors, e.g. level of competitor promotional activity, 1.2.2 Economic conditions, e.g. level of inflation; 1.2.3 Demographic trends ands social factors, e.g. changes in age profile of customers which may affect promotional activity;
2. Budgeted profit and loss account : 2.1 Revenue, 2.2 Promotional spend, 2.3 Advertising, 2.4 Gifts, 2.5 Donations, 2.6 Wages, 2.7 Light and heat, 2.8 Motor and traveling expenses, 2.9 Subsistence, 2.10 Postage, printing and stationery, 2.11 Telecommunications, 2.12 Subscriptions, 2.13 Publications, 2.14 Sundry expenses, 2.15 Sub-contracted work, 2.16 Apportionment of fixed overheads.
3. Control of expenditures: 3.1 Variance report (columns): 3.1.1 Actual revenue and expenditure for the month; 3.1.2 Fixed budgeted revenue and expenditure for the month, 3.1.3 Flexed budgeted revenue and expenditure for the month; 3.1.4 Variance between actual and fixed budget (month); 3.1.5 Variance between actual and flexed budget (month); 3.1.6 Year-to-date actual revenue and expenditure; 3.1.7 Year-to-date fixed revenue and expenditure; 3.1.8 Year-to-date actual revenue and expenditure; 3.1.9 Variance between actual and fixed budget (year-to-date); 3.1.10 Variance between actual and fixed budget (year-to-date); 3.2 Staff holiday and sickness; 3.3 Progress of promotional and advertising campaigns; 3.4 Month-end stockholding, e.g. stationery, promotional literature; 3.5 Analysis of sub-contracted work; 3.6 Analysis of sundry expenses.

Master budget is the set of (i) budgeted profit and loss account, (ii) budgeted balance sheet and (iii) cash budget.

Principal budget factor is a factor which will limit the activities of an undertaking and which is taken into account in preparing budgets.

See below Budget committee, Budget manual, Budget period, Budgetary control and Budgeting .

See also Cash budget, Fixed budget, Flexible budget, Functional/departmental budget, Principal budget factor, Zero Based Budget .

Budget committee Ideally comprises representatives from every part of the organization and oversees the budgeting process by coordination and allocating responsibility for budget preparation, time-tabling, providing information to assist in budget preparation and monitoring the budgeting and planning process by comparing actual and budgeted results.

Budget manual is a detailed set of documents that provides information and guidelines about the budgetary process.

Budget period is the period for which a budget is prepared and used, which may then be subdivided into control periods.

Budgetary control
Definition #1.
Budgetary control is the practice of establishing budgets which identify areas of responsibility for individual managers and of regularly comparing actual results against expected results.
Definition #2.
Budgetary control involves the comparison of actual results with a flexible budget. The difference are known as variances.

The objectives of budgetary control systems are as follows: 1) to ensure the achievement of the organization's objectives, 2) to compel planning, 3) to communicate ideas and plans, 4) to coordinate activities, 5) to provide a framework for responsibility accounting, 6) to establish a system of control, 7) to motivate employees to improve their performance.

Main advantages of budgetary control systems : 1. Limitation of resources overspent; 2. Support to variance analysis; 3. Evaluation of management performance; 4. Control of all activities on continuous base.

Variances of budgetary control: 1. Sales variances: 1.1 Sales prices, 1.2 Volume variances, 1.3 Sales mix, 1.4 Sales quantity variances, 1.5 Market size and market share; 2. Production variances: 2.1 Direct material variances, 2.2 Direct labor variances

Sales and marketing budgets necessary because : 1) it is an element of the overall strategic plan of the business (the master budget) which brings together all the activities of the business; 2) where sales and other non-production costs are a large part of total costs, it is financially prudent to forecast, plan and control them; 3) since selling rests on uncertain conditions, good forecasts and plan become more important.
See also Control.

Budgeting is an essential financial discipline but a particularly tricky problem in marketing given the difficulty in determining both likely demand and likely cost of achieving a given sales target.

Data for the budgeting process: 1) Formal sources (Control and monitoring reports, forecasting, and enquiry systems, modeling and simulation, investigative reports, budgets, job description, organization charts and correspondence): (i) Production and operation information (Manufacturing capacities, Capabilities and lead time), (ii) Marketing and sales information (Performance, Revenues, Market share and Distribution channels), (iii) Financial information (Cash in the bank, Borrow capabilities, Profits, Costs, Cash flows), (iv) Research and development information (New products and developments), (v) Personal information on (Labor skills, Labor skills, Labor availability and Expected wage increases); 2) Informal sources: Telephone conversations, Discussions, Social contacts, Meetings, Personal record keeping and Correspondence)

Main difficulties in budgeting for overheads :
1. Accuracy - Budget is based on the past date and change is applied to arrive at the new budget. 2. Fluctuating overheads - Arriving at the future date is very complex. 3. Uncontrollable factors - Unpredictable external factors (SLEPT) will have impact on overheads; 4. Motivation - Under budgeting for overheads will demoralize the employees. 5. Allocation of resources - An increase in bonus payments to sales people who exceed their targets.

Bundle pricing The practice of including several products together for one price. (Courtland L. Bovee, John V. Thill)

Bundling Combining products for promotional reasons, often at a discounted price. (Courtland L. Bovee, John V. Thill)

Bureaucracy is the type of organization characterized by hierarchy, specialization, impersonality, professionalism, rationality, uniformity, technical competence and stability. Based on rational-legal, as opposed to charismatic or traditional authority.

Business analysis See Stages of new product development

Business portfolio The collection of businesses and products that make up the company. (Philip Kotler)

Business cycle (or trade cycle)
Definition # 1. Business cycle is the periodic fluctuation of levels of economic activity, for example output and employment.
Definition # 2. Business cycle is the regular fluctuations of economic activity and income through boom, downturn, recession and upturn.

Main phases of the business cycle:
1. Recession: 1.1 Consumption falls off, 1.2 Main investment suddenly become unprofitable and new investment falls, 1.3 Production falls, 1.4 Employment falls, 1.5 Profit falls. Some businesses fail;
2. Downturn (Depression): 2.1 Heavy unemployment, 2.2 Low consumer, 2.3 Prices stable, or even falling, 2.4 Business profit low
3. Recovery: 3.1 Investment picks up, 3.2 Employment rises, 3.3 Consumer spending rises, 3.4 Profits rise, 3.5 Business confidence grows, 3.6 Prices stable, or slowly rising.
4. Boom: 4.1 Consumer spending rising fast, 4.2 Output capacity reached: labor shortages occur, 4.3 Output can only be increased by new labor saving investment, 4.4 Investment spending high, 4.5 Increases in demand now stimulate price rises, 4.6 Business profits high.

Marketing policy of different stages of the business cycle:
1) Recession is a stage of the business cycle where GDP has fallen for two consecutive quarters. Marketing policy: Sit tight and wait for upturn. Be aware of brighter times ahead so retain skilled core and upgrade. Order capital equipment for installation 18 months hence since prices are at the lowest for all resource contracts.
2) Downturn (Depression). control stock in line with order slowdown. Marketing policy: The psychology is still one of grown with orders up on a year ago. This is right time to conduct a Pareto analysis to weed out weak products and channels outlets, Recruitment should be halted and no further long-term commitment taken on.
3) Recovery talk is still of recession but the rate of changing in orders is upward. Marketing policy of Recovery stage: Start building stock and upgrade. Order capital equipment for installation 18 months hence since prices are at the lowest for all resource contracts.
4) Boom  - the rate of grown of sales level out as demand bumps along a peak. Marketing policy: The firm must retain in stock but all expansion plans should be frozen. Any surplus plant should be sold at this time to realize top prices. New markets may be explored emphasis should be on controlling costs to meet the gloomier times just around the corner.
Relation between Business cycle and environmental issues: 1) 1989-90 economic boom - pick environmental concern, 2) 1991-92 recession - primary concern with unemployment.

See also Feel bad factor and Feel good factor.

Business life cycle The progression of events in business formation that starts with the establishment of a new busi-ness and continues through growth, maturity, and decline . (Courtland L. Bovee, John V. Thill)

Business interview normally takes place at the interviewee's place of business.
See also In-house interviews.

Business mission is enduring statement of purpose that distinguishes a business from others of its type.

Business name is a name used by a company other than the registered one.

Business process re-engineering Management technique which aims to enhance productivity and responsiveness by changing organization structures and deployment of resources around key business processes.

Business strategy How to approach a particular product and/or market.

Business values are the philosophical and ethical standards adhered to by personnel in the pursuit of the organization's purpose.

Business-to-business Advertising intended to sell products or services to companies. Often called industrial or trade advertising. (Responsive Database Services, Inc.)

Buyer The person who makes an actual purchase. (Philip Kotler)

Buyer Behavior Theory (Howard and Sheth) formulated a model to show how 'set' works in consumers' brand choice:
1) There will be some brands of which the individual will not aware at all. This unawareness set will not impact on his decision.
2) There will be a group of brands of which the customer is aware - his awareness set - and from which he will make his selection.
3) Within the awareness set, there will be a group of brands which he will call to mind and consider purchasing. This is called the evoked set.
4) Inert set of brands is set which individual is aware, but about which he is completely indifferent.
5) Inept set of brands is set which individual is aware, but about which he is negative - because of bad experience, associations.

Buyer decision process See Consumer buying behavior.

Buyers see Decision Making Unit

Buying associations Informal groups of retailers, usually in a specific geographic locality, who group together to enjoy the economics of scale accruing from bulk purchases form wholesalers and manufacturers.

Buying center All the individuals and units who participate in the organizational buying decision process. (Philip Kotler)

Buying center roles :
Roles assumed by various members of the buying center, including initiator, influencer, decision maker, gatekeeper, purchaser, and user. (Courtland L. Bovee, John V. Thill)

See also Decision Making Unit.

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