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Glossary: Product marketing & growth

Hand-picked product marketing terms, definitions, and frequently asked questions. Each product marketing term is defined and explained simply by our research team.

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Back End (In a Website)

The back end of a website is everything that goes on behind the scenes, from servers to databases — and much more.

Brand Equity

Brand equity is the value of a brand in the eyes of the customer. A brand can have a positive or negative brand equity depending on how it is perceived, and this can have a positive or negative impact on a business’s commercial value.

Brand Extension Strategy

A brand extension strategy is the use of one’s current brand name and brand recognition to enter into a new product class.

Brand Recognition

Brand recognition is the degree to which a company’s brand is familiar, liked, and trusted by consumers. Good brand recognition offers many advantages to companies including helping to build and maintain healthy market share and profitability.

Break-Even Point

A Break-Even Point is the point at which total revenue matches the total cost for a particular venture. At the Break-Even Point, an organization has recouped its costs but not yet made any profit.

Business Plan

A business plan is a strategic document which details the business model and key tactics for a growing business or startup. It is especially important during the tricky first few years, or whilst seeking external investment.

C

Cash Flow

Cash flow shows how much cash is moving in and out of your business every month. As they say: “Cash is King”. So being aware of your cash flow is crucial to the running of a successful business.

Cash Flow Budget

Often referred to as a cash budget or a cash flow, the cash flow budget allows a company to keep on top of cash income and outgoings over time.

Channels of Distribution

Channels of Distribution (or a distribution channel) are channels of businesses or intermediaries which a product or service travels through before reaching the final customer.

Churn

Churn is the percentage of customers that stop using your business during a given time frame.

Click-Through Rate (CTR)

Click-through rate is the percentage of an advert or listing impressions that result in a user clicking through to the site.

Co-Branding

Co-branding is a form of partnership, where two companies or brands share their brand names, logos, etc., on one project, one product, or one piece of software.

Competitive Advantage

Competitive advantage is what makes a customer choose your business over another one. By understanding, and promoting, a competitive advantage, companies can win a greater amount of market share.

Competitive Analysis

Competitive analysis is the process of identifying competitors and evaluating their strategies in order to determine their weaknesses and strengths.

Conversion Rate

Conversion rate refers to the percentage of website visitors that complete a specific action.

Cost Of Goods Sold (COGS)

The Cost of Goods Sold (COGS) is how much it costs to produce a finished product for the market. Put simply: it is the cost of making the goods a company sells, including the cost of materials, production time and labor.

Cost of Sales

Cost of sales (also known as cost of goods sold) refers to the cost required to manufacture or purchase a product that is then sold to a customer.

Customer Acquisition Cost (CAC)

Customer Acquisition Cost (CAC) is a metric used to convey how much money a business needs to spend to win a new customer.

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Economies Of Scale

Economies of scale are the potential cost savings that can be made by producing goods or services in higher volumes, spreading fixed costs over a great volume.

Evaluating Ideas And Opportunities

Evaluating ideas and opportunities is a crucial process to determine which business concepts have value — and which don’t.

F

Fatal 2% Rule

The Fatal 2% Rule states that if a company or venture can achieve 2% of total market share it will be successful, but failing to achieve 2% will be fatal.

First Mover Advantage

First-Mover Advantage refers to the competitive edge a business earns by being the first to launch with a certain product or service.

First-Mover Disadvantage

First-mover disadvantage refers to the challenges a business encounters by being the first to market with a new product or service.

Front End (In a Website)

The front end of a website is everything the user either sees or interacts with when they visit the website. It is responsible for the look and feel of a website.

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Guerrilla Marketing

Guerrilla marketing is a form of promotion that relies on unconventional, and surprising, methods to create impactful, memorable marketing campaigns.

I

Ideas Versus Opportunities

Potential business opportunities are built on good ideas, but not all good ideas translate into valuable opportunities. Understanding this difference is key to making the right decisions.

Iterative Testing

Iterative testing is the process of making small changes to products, based on insights gained from previous changes. Iterative testing is a valuable tool for SaaS and tech-based companies.

K

Key Performance Indicator (KPI)

A KPI, or Key Performance Indicator, is a measurable value which aligns directly to an overall goal or objective of the business. KPIs are used to evaluate how well a company and its employees are achieving their targets.

L

Lifetime Value (LTV)

Lifetime Value (LTV) is a monetary amount representing the estimated revenue a customer will bring in across their entire time as a customer.

M

Market Development Strategy

Market Development Strategy refers to a strategy in which companies introduce their product or solution to new audiences, outside of their current markets.

Market Penetration Strategy

Market penetration strategy is used by companies or organizations to launch or grow their presence and customer base within one of their already existing markets, or an existing market where a similar product or offer already exists.

Market Segmentation

A market segmentation breaks down a company’s target audience by certain attributes, to allow more targeted marketing and product development.

Market Share

Market share is the percentage of a certain market that an individual company’s sales are responsible for. Market share is used to give you an idea of how large, powerful or important your business is within its particular sector.

Marketing Audit

A Marketing Audit takes a comprehensive look at all strategies, processes, and tools of an organization’s marketing environment, and helps to develop successful ways of working in the future.

Marketing Cost Analysis

A marketing cost analysis is a way of assessing the full costs associated with any new marketing campaign. It is designed to provide a comprehensive breakdown of all the costs associated with a new marketing campaign.

Marketing Mix

The marketing mix is an umbrella term for all of the tactics or actions a company can employ to drive sales and increase awareness of its brand.

Marketing Plan

A marketing plan is a document that defines a marketing strategy for a company in order to reach their targeted audience.

Monthly Recurring Revenue (MRR)

Monthly Recurring Revenue (MRR) is a vital element of any business that relies on a subscription model, and an incredibly important metric to allow subscription businesses to prosper.

N

Net Promoter Score (NPS)

Net Promoter Score is a metric that gauges customer loyalty and satisfaction simply by asking customers how likely they are to recommend your product or service on a simple scale.

O

Objectives and Key Results (OKR)

Objectives and Key Results, also known as OKR, is a goal-setting framework used in businesses to align individual performance with overall goals in a measurable way.

Operating Expenses

Operating expenses are costs that are incurred by the day-to-day operations of a business. For example, overheads (rent, utilities, office supplies) and payroll.

Opportunity Cost

An opportunity cost is the inevitable loss of profit, growth or other value, which must be spent in order to focus on an activity. Despite its name, opportunity cost is not necessarily a bad thing.

P

Pageviews

Pageviews is the number of times an individual web page has been loaded or reloaded.

Payback Period

The payback period refers to the length of time a business expects to wait before the initial investments in a product or project are recovered.

Penetration Pricing Strategy

Penetration pricing refers to setting a low initial cost for a new product or service. Usually, this is done by businesses to gain market share quickly or get new customers to purchase.

Price Elasticity Of Demand

Price elasticity of demand relates to the way in which demand for a product changes based on price adjustments. Certain products are inelastic, as a change in price leads to little or no change in demand.

Product Analytics

Product analytics is essential for developing a comprehensive understanding of how users engage with products. This feedback is often more accurate than other forms of user input as it tracks actual user behavior rather than relying on qualitative remarks.

R

Return On Investment (ROI)

Return on Investment is a key business metric that measures the profitability of investments or marketing activities by weighing the size of the upfront cost against the net profits it produced.

Return On Sales (ROS)

Return on Sales is a ratio businesses use to calculate their operational efficiency. As a result, they can identify where improvements are needed to reduce operating expenses and boost revenue.

Return Visitors

Return visitors are users who have visited a certain website before, in the last two years.

S

Strategic Marketing Management

Strategic marketing management is the process of implementing your business’ mission through specific and strategic processes in order to maximize on your current marketing plan.

Sales Forecast

A sales forecast is a business’s estimation of a product’s future sales. This helps companies make well-informed decisions related to resources, workforces, and more.

Seed Capital

Seed capital is a relatively small investment that contributed to a startup at the very earliest stage of the venture.

Success Factors

Success factors are all of the different internal and external influences which can impact the potential success of a business.

Success Requirements

Success requirements are the factors that influence whether or not a SaaS business is successful in achieving its strategic and financial goals.

Sunk Cost

Sunk cost is money that has been spent and cannot be recovered. Whilst it sounds damaging, sunk costs are unavoidable in business. Anything from buying office equipment, to researching a new feature that goes on to flop, can result in sunk cost.

T

Traffic

Traffic, often referred to as website traffic is a measure of many visitors, or visits, a website gets.

U

Usability Testing

In usability testing, qualitative data is gathered from users on specific parts of your service or process. This data is used to improve the user experience, with the ultimate goal of retaining loyal customers.

User Interface (UI)

User interface (UI) is any method or means by which the end-user of a product interacts with, or controls, a product, software or hardware device. User interface is designed to allow humans to control machines effectively and efficiently

V

Vanity Metrics

Pageviews, registered users and app downloads are all vanity metrics. Whilst these figures are exciting at first, they are not useful in measuring true commercial impact and success.

W

Website Metrics

Website metrics are a variety of measurements made on a given website in order to better track its performance and statistics.

Website Traffic

Website traffic is a term used for the number of visits a website receives. There are different ways to measure and increase traffic, to achieve better brand visibility and drive conversions.

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Glossary: Product marketing & growth

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