B2B Marketing Glossary

Buy cycle – The buy cycle is the process buyers go through to select and purchase a product or service. The phases involved include awareness, information, assurance and loyalty. The buy cycle is now the focus of marketers (instead of the sales cycle), because the Internet has put buyers, not sellers, in control.

Blue Ocean Strategy – a methodology developed by Kim Chan and Renee Mauborgne of INSEAD (The Business School for the World) that helps organizations identify uncontested market space with opportunity to grow while increasing value to customers and lowering cost.

Cash cow – A product that is a cash cow is in a declining market, the last stage of the product lifecycle. The owner of the product should not spend much money marketing the product, but “milk it” for all it’s worth as demand for the product slows down.

Disruptive innovation – An unexpected innovation that changes forever the way people do things or think about things. The Internet changed the way people shop and buy products and services; as a result marketers must provide content about their products online, where buyers research and many purchase.

Inside sales – Inside sales people work from a desk and communicate with prospects using the phone and other technology such as email and online meetings to sell products and services. Hiring of inside sales people is increasing and technology replaces the need for sales people to travel to prospects.

Lead nurturing – Lead nurturing is the art of providing the right information and content online for prospective buyers in various stages of the buy cycle: awareness, information, assurance and loyalty.

Marketing – Marketing is the process of identifying and defining customer needs and wants, the target audiences a company can serve, products and services that fit the target audiences’ needs, and communicating information about the products and services to support the buying cycle.

Marketing persona – Marketing personas tell a story about each customer segment a company serves. Marketing personas are often given real names and are written in a very realistic manner to bring the persona of a customer segment to life.

Marketing ROI – Marketing return on investment (ROI) is calculated by dividing the  revenue generated by a marketing activity by the cost of the activity. It makes sense to calculate ROI for each different marketing activity for comparison purposes as well as for your marketing department as a whole.

Mindshare – Mindshare is the share of a prospect’s mind that is taken up thinking about your brand, product or services. Mindshare is increased by staying in front of prospects and customers with value-add communications and marketing.

Niche marketing – Niche marketing is when a business identifies a part of an industry or specific buyers that have special qualities and markets only to that audience. Niche marketing is a good strategy for any company; changing to a niche strategy in a mature market is a way for a business to better compete when a market reaches maturity.

Porter’s 5 Forces – Porter’s Five Forces is a model used assess potential profitability, opportunity and risk based on five key factors within an industry. The five factors include how powerful your customers are (can they negotiate lower prices – think Walmart), how powerful suppliers are (can they raise prices), how much competitors are a threat and whether or not there are significant substitutes that may lessen demand for your product, and how much competitive rivalry exists in a marketplace.

Price elasticity – Price elasticity means that the change in demand for your product will decrease more (more elastic) when there is a price increase if customers believe that there is lots of competition out there, if they are apt to change suppliers easily, or if it appears that your product does not have a competitive advantage.

Price sensitivity – Customers are more sensitive to price increases if they know there are substitutes readily available or if there are competitors in the industry.

Product lifecycle – Products have a lifecycle, including an introductory phase, a growth phase, a mature phase and a declining phase. The lifecycle timeline looks like a Bell Curve, meaning that the introduction and growth phase show a rapid increase in sales; the mature stage shows flattening of sales growth and decline is where the sales decrease. Different marketing strategies and tactics apply depending upon where a product is in its lifecycle.

Reseller – Resellers are a marketing channel for some companies in which a related company bundles and resells a product or service in with its offerings to make a more robust solution.

Retail – A retail marketing channel is commonly used for consumer products and is either a brick and mortar store or an eCommerce site on the Internet.

Sales agent – A sales agent is typically an individual or company with connections in an industry that allow them to represent a product or service to businesses in the industry. Sales agents typically make a commission when they make a sale.

Sales cycle – The sales cycle was the focus of marketers for years: how to manage it, influence and accelerate the purchase decision of the prospects. The sales cycle focus was appropriate when sellers held the information about their product or service and pushed that information out. The sales cycle has been replaced by the buy cycle, since buyers have the Internet to get information about what they want to buy when they want it.

Social media – Social media are websites that allow individuals and companies to create profiles and share information and content about their company, products and services, and industry.

Supply chain – The supply chain shows the entire chain of businesses that are involved in producing a final product or service. For example, a laptop supply chain would include the vendors for all of the components, the providers of any external processing, the manufacturer with its assembly and packaging operations – to the point of consumption.

SWOT analysis – SWOT stands for strengths, weaknesses, opportunities and threats. A SWOT analysis involves looking at internal factors (for example strength of distribution channel, weakness of lack of brand awareness) and external factors (opportunity first company to market, threat low barrier to entry into the market), and then identifying an action plan to leverage strengths and opportunities and minimize weaknesses and threats.

Value-based pricing – Value-based pricing is not based on the costs that go into a product but more based on the perceived value by the customer of the product. If the customer does not perceive value (sometimes customers don’t know what they don’t know), a business must calculate the value of the solution and demonstrate that to the customer.

Voice of customer – Voice of the customer is a practice in which, through rigorous investigation and research, a business uncovers their customers wants and needs and presents them in priority order.

Wallet share – Wallet share refers to the process of communicating with customers to sell additional products and services. It is 5 to 10 times more expensive to sell to a new than an existing customer, so recently much attention has been on “increasing wallet share” with existing customers.

Wholesaler – A wholesaler buys products in large volume and sells at a discount to parts of the supply chain in an industry but not the end user. Traditionally, wholesalers leveraged relationships within industries that the seller of a product did not have access to. With the Internet, some leverage their geographic location nearer manufacturing bases.