Macmillan Dictionary of Marketing and Advertising

278 Pages·1990·20.16 MB·English

by  Michael J. Baker (auth.)

MACMILLAN
DICTIONARY
OF
MARKETING AND
ADVERTISING
MACMILLAN
DICTIONARY
OF
MARKETING AND
ADVERTISING
Second Edition
Michael J. Baker
M
ISBN 978-1-349-10066-8 ISBN 978-1-349-10064-4 (eBook)
DOI 10.1007/978-1-349-10064-4
© Michael J. Baker, 1984, 1985, 1990
Softcover reprint of the hardcover 1st edition 1990 978-0-333-45994-2
All rights reserved. No reproduction, copy or
transmission of this publication may be made without
written permission.
No paragraph of this publication may be reproduced,
copied, or transmitted save with written permission or in
accordance with the provisions of the Copyright,
Designs and Patents Act 1988, or under the terms of any
licence permitting limited copying issued by the
Copyright Licensing Agency, 33-4 Alfred Place, London
WC1E 7DP.
Any person who does any unauthorised act in relation to
this publication may be liable to criminal prosecution
and civil claims for damages.
First edition published 1984
Paperback first published 1985, reprinted 1987.
Second edition first published 1990 by
THE MACMILLAN PRESS LTD
London and Basingstoke
Associated companies in Auckland, Delhi, Dublin,
Gaborone, Hamburg, Harare, Hong Kong,
Johannesburg, Kuala Lumpur, Lagos, Manzini,
Melbourne, Mexico City, Nairobi, New York, Singapore,
Tokyo.
British Library Cataloguing in Publication Data
Baker, Michael J. (Michael John) 1935-
Macmillan dictionary of marketing and
advertising. - 2nd ed.
1. Marketing
I. Title
658.8
ISBN 978-0-333-51604-1
ISBN 978-0-333-51605-8 pbk
The paperback edition of this book is sold subject to
the condition that it shall not, by way of trade or
otherwise, be lent, resold, hired out, or otherwise
circulated without the publisher's prior consent in
any form of binding or cover other than that in which
it is published and without a similar condition
including this condition being imposed on the
subsequent purchaser.
MAJOR CONTRIBUTORS
Michael J Baker
Ken N Bernard
Marie Clare Cameron
Keith Crosier
Steve K Tagg
OTHER CONTRIBUTORS
George A vlonitis
J ABound
AJBrown
Kevin A Boyle
Douglas Brownlie
James R Bureau
Kenneth R Deans
Sandra Deans
WDonaldson
J L Drayton
Keith Fletcher
Joanna Kinsey
Douglas Leathar
James M Livingstone
Gerald Michaluk
Barry R Moore
Stephen T Parkinson
Graham K Peaston
Margaret D Potts
Michael Saren
Colin N Wheeler
Alan M Wilson
Introduction
Since its first publication in 1984, the upsurge of interest in the subject of
marketing which prompted the preparation of a Dictionary of Marketing and
Advertising has continued unabated. Indeed, if anything, it has gathered
momentum and greatly increased the number of persons exposed to terms and
phrases which were formerly the preserve of the marketing specialist. At the
same time, emphasis upon marketing as a major factor contributing to
competitive success and its recognition as a major business function has
resulted in a rapid expansion of the vocabulary of the subject. To respond to
these changes, a new, revised edition is clearly called for and, with the
collaboration of my colleagues in the Department of Marketing at Strathclyde
University, this considerably enlarged and updated second edition is the result.
As Editor, I consider the original objective of providing concise but
informative definitions still to be the primary goal. The intended audience
remains practitioners, managers, students and lay persons in other fields who
are exposed to marketing 'jargon' and need a clear explanation of its meaning.
However, while considerably more technical terms have been included, no
attempt has been made to incorporate the more arcane terminology of the
marketing specialist in sub-fields such as advertising, marketing research, P.R.,
etc. Persons seeking such terms will have to refer to the specialised text books
and glossaries which deal with these essentially minority interests.
As before, individual contributions to the Dictionary are identified by the
author's initials and reflect the extensive involvement of the staff of what is
believed to be the largest specialist grouping of academic experts on marketing
in Europe - Strathclyde University's Department of Marketing. To them all I
extend my grateful thanks. However, the major credit for the greatly expanded
second edition must go to the two successive Research Assistants who have
looked after me so well over the years. In this case, Graham Peaston and Marie
Clare Cameron.
Graham initiated the revision by scanning all the major marketing texts and
preparing a listing of words and phrases which appeared to enjoy some
currency but were missing from the first edition. Valuable as this was, the
real task of marshalling the resources of the faculty, cajoling contributions
from them, and synthesising them into a single coherent manuscript was
viii Introduction
accomplished by Marie Clare Cameron. This second edition is very much a
tribute to her dedication and skill.
We all trust you find the new edition a useful addition to your working library
and, as before, will welcome comments and suggestions for further improve
ments.
Michael J Baker
A
AA. See ADVERTISING AssociATION. absolute frequency. A raw count of the
numbers of occurrence of each value of a
variable. (sKT)
AB. See SOCIO-ECONOMIC CLASSIFICATIONS.
absolute income hypothesis. One of three
ABC. See AuDIT BuREAU OF CIRCULATIONS. theories which have evolved in an attempt to
explain variations in aggregate consumption
functions. This theory holds that expendi
ABC analysis. A technique for the class ture/savings are a function of income. See
ification Of INVENTORY Or STOCK in relation a/so PERMANENT INCOME HYPOTHESIS and
to its importance to the stockholder, based on RELATIVE INCOME HYPOTHESIS. (MJB)
the rank ordering of the cumulative value of
usage of individual items over a prescribed absorption COSting. See FULL COST APPROACH.
period of time (usually one year). The
resultant list is then divided conventionally
accelerator. See ACCELERATOR PRINCIPLE.
into three groups (A, Band C), making use of
PARETO ANALYSIS, SUCh that approximately
70 per cent of cumulative value found is to be accelerator principle. A principle in business
derived from about 10 per cent of PRODUCTS cycle theory which holds that changes in
or commodities (class A); 20 per cent demand for consumer goods will give rise to
of cumulative value is derived from the increased changes in the demand for those
subsequent 20 per cent of products or capital goods, i.e. investment, which are
commodities (class B) and the remaining 10 required to make the consumer goods. (MJB)
per cent of cumulative value from the
residual 70 per cent of products or com acceptance. (1) In MARKETING COMMUNICA
modities(classC). (KNB) TIONS, the integration of incoming information
into the long-term memory or coGNITIVE
STRUCTURE as positive CONCEPTS related to
above-the-line. The 'line' is an imaginary the PRODUCTS.
boundary between those advertising media (2) The ADOPTION by CONSUMERS of new
which pay COMMISSION to advertising products. Prediction of acceptance can be
agencies and those which do not, the latter made using DIFFUSION MODELS (e.g. the Bass
being 'below-the-line' media. The above-the model of product acceptance), and repre
line media are: newspapers, magazines, sented graphically by means of an ADOPTION
television, radio, posters and cinema. CURVE. (GKP)
Directories, yearbooks, matchbooks and
point-of-sale materials (for example) are accessibility. One of the four basic properties
below the line. (Kc) a market segment must possess if it is to
2 account
deserve specific marketing attention. The acid test/quick ratio/liquidity ratio =
other three conditions are that it should be
measurable, substantial and unique in its current assets-stock
response. A fifth condition proposed by
Michael Thomas is that segments should be current liabilities
stable in the sense that their behaviour may
be predicted in the future. See also MARKET current assets
SEGMENTATION. (MJB) current ratio=
current liabilities
account. An individual piece of business
price earnings ratio =
given to an advertising agency by an
advertiser. One client may thus represent
market price per ordinary share
several accounts, from the agency point of
view. There is no direct connection with
earnings per ordinary share after tax
'account' in its financial sense. (Kc)
Other accounting ratios of most interest to
account executive. The person in the advertis marketing managers are: operating profit/net
ing agency whose job is to act as the point of operating assets; operating profit/sales;
contact for a single account or group of production costs/sales; marketing expenses/
accounts. The more self-explanatory, but sales; distribution expenses/sales; admini
relatively rare, term is 'client-service execu stration expenses/sales; cash/average day's
tive'. Account executives (often called 'AEs') sales; debtors/creditors; sTocK/average day's
need considerable skills of coordination, sales. (oM)
negotiation and diplomacy to discharge their
task to best effect. The large London agencies
annually recruit university graduates for aCCOUnt planner. See ADVERTISING AGENCY.
account-executive training; they are general
ly then termed ·graduate trainees'. ( KC)
account planning. One of the two planning
functions in a sophisticated FULL-sERVICE
accounting. The concept, conventions and ADVERTISING AGENCY, the Other being MEDIA
procedures used to record and analyse trans PLANNING. 'ACCOUNT' is USed here in the
actions between parties in the exchange of specialized advertising sense of the word.
goods and services. (MJB) Account planners are mostly concerned with
research -formative and developmental, as
well as straightforward market research -
accounting ratios. Tools for performance and with the theoretical underpinnings of
ANALYSis often used to evaluate profitability advertising strategy; they are, so to speak,
and liquidity. As with all ratios, percentages the intellectual wing of the business. The
and yields, they are of little use if viewed in goal of account planning is to understand
isolation. It is necessary to compare a ratio consumers, audiences, markets and society,
with some standard, the most common being and to use that knowledge as a basis for the
budgets, previous year's figures, or external development of advertising that will work.
industrial AVERAGES, compiled from The role of account planners is thus quite
observing the ratios of companies operating often to influence CREATIVE strategy (media
in the same or similar field. The most planners doing the same for media strategy).
common ratios used are: This can in practice cause internal conflict,
since key people in the CREATIVE DEPARTMENT
are likely to maintain that creativity is an
return on capital employed = intuitive and personal process, not amenable
to design by committee or interpretation by
profit (before interest) x 100 researchers.
Account planning is still a young discipline,
capital employed not yet really common in smaller or less
administered channel system 3
sophisticated advertising agencies. It was behind the ratio is that STOCK is often the
'invented' in Britain, at the J. Walter most difficult current asset to realize at book
THOMPSON agency, and remains something value in a crisis, and if a company can meet all
of a British specialization. The Californian its liabilities from other current assets, then it
agency credited with pioneering its introduc will have a good liquidity level. ( GM)
tion into America, for instance, has an
Account Planning Department staffed entirely ACORN. A type of socio-economic classifica
by expatriates. The Account Planning Group tion by allocating to a locality in which a
is a professional common-interest group for respondent lives, one of a number of types
account planners and ADMAP is the house derived from Population Census data about
journal ofthe discipline. (Kc) the locality. See CONSUMER LOCATION
SYSTEM, SOCIO-ECONOMIC CLASSIFICATIONS.
(JAB)
accrual accounting. The accrual concept in
ACCOUNTING recognizes costs and revenue as
acquiescence bias (yea-saying). The tendency
they are earned or incurred, and not as
of questionnaire and interview RESPONDENTS
money is received or paid, i.e. matching
to form a response set: specifically it is a
revenue with expenses. See also ACCRUALS
distortion of true responses to increase the
and PRE-PAID EXPENSES. ( GM)
number of yes responses, or to be in
agreement with the imagined point of view of
accruals. Charges for items consumed or the researcher or interviewer. ( SKT)
incurred during the period for which no
invoice has yet been received. Common acronym. A word formed from the initial
examples of such liabilities incurred but not letters of other words, e.g. CAT I = Compu
entered in the accounts ledger are gas, ter Assisted Telephone Interviewing. ( MJB)
electricity, and telephone charges where the
service has been consumed, but not yet billed active exposure. Exposure to MARKETING
for. See also ACCRUAL ACCOUNTING and PRE information as a result of an active inform
PAID EXPENSES. (GM) ation search process undertaken by the
coNSUMER. Marketers are therefore required
accumulation process. The collection of to accommodate consumers by providing
products from many small producers, a relevant information in a readily accessible
process common in agriculture and horticul form. See also PASSIVE EXPOSURE. ( GKP)
ture. After collection, the products can
be more efficiently graded, packed, or activities, interests and opinions. See PSYCHO
processed, ready for distribution to the GRAPHICS.
channels of distribution, or can be marketed
as a standard unchanging product with a ad. See ADVERTISEMENT.
guarantee of quality. (AJB)
addendum. An additional mark to be added.
achieved communality. The coMMUNALITY ad hoc. For this purpose; type of research.
achieved in a FACTOR ANALYSIS. To be
contrasted with estimated communalities, Admail. A Post Office redirection response
which need to be specified in advance. (sKT) service which allows a firm to quote a local or
prestigious address in an ADVERTISEMENT
acid test. The acid test, also known as the and then have the replies redirected to
QUICK RATIO and LIQUIDITY RATIO, is: another address in the UK. ( GM)
current assets-stock Admap. A British professional periodical,
mainly for MEDIA PLANNERS and researchers,
current liabilities taking the form of an academic journal rather
than a trade magazine. ( KC)
This ratio is a measure of liquidity, and as
with all ratios, percentages and yields, is of administered channel system. A set of rela
little use if viewed in isolation. The rationale tionships in ordering, supply and payment