Marketing Abbreviations — Part 1 MCQs with Explanations

Voice of the Customer (VoC) is a term that describes your customer’s feedback about their experiences with and expectations for your products or services. It focuses on customer needs, expectations, understandings and product improvement. VoC programs have gained traction over the years and are fast-growing segments of a core business strategy for organisations. They work exceptionally well for brands as customers demand more direct engagement with a firm and because capturing and acting on customer feedback is critical to understanding a prospect’s complex decision-making process.

Value Added tax (VAT) is a type of indirect tax levied on goods and services for value added at every point of production or distribution cycle, starting from raw materials and going all the way to the final retail purchase. VAT was introduced on April 1, 2005. Under it, the amount of value addition is first identified at each stage, and then tax is levied on the same. Ultimately, the end consumer has to pay the complete VAT while buying goods; buyers at earlier stages of production receive reimbursements of tax they have paid. Because the consumer bears the entire tax, VAT is also a consumption tax.

VALS (Values and Lifestyles) is a proprietary research methodology used for psychographic market segmentation. Market segmentation is designed to guide companies in tailoring their products and services in order to appeal to the people most likely to purchase them.

True Market Value (TMV) is a term commonly used for a Real Estate e-auctions or online auction, as it creates transparency for the buyers and ensure that the seller maximises the price of the property to the true market value. The transparency creates a fair deal for all parties and is auditable if any twists around the deal should arise.

The Universal Product Code (UPC) is a bar-code symbology that is widely used worldwide for tracking trade items in stores.

The user experience (UX or UE) is how a user interacts with and experiences a product, system or service. It includes a person's perceptions of utility, ease of use, and efficiency. Improving user experience is important to most companies, designers, and creators when creating and refining products because negative user experience can diminish the use of the product and, therefore, any desired positive impacts; conversely, designing toward profitability often conflicts with ethical user experience objectives and even causes harm. User experience is subjective.

The point of sale (POS) is the time and place where a retail transaction is completed. At the point of sale, the merchant calculates the amount owed by the customer, indicates that amount, may prepare an invoice for the customer, and indicates the options for the customer to make payment.

The Market Access Program (MAP; formerly the Market Promotion Program) is administered by the Foreign Agricultural Service and uses funds from the Commodity Credit Corporation (CCC). It helps producers, exporters, private companies, and other trade organizations finance promotional activities for agricultural products of the United States. MAP is designed to encourage development, maintenance, and expansion of commercial agricultural export markets. As such, it is considered to be a World Trade Organization "Green Box" program. Activities financed include consumer promotions, market research, technical assistance, and trade servicing.

The International Monetary Fund (IMF) is an international financial institution, headquartered in Washington, D.C., consisting of 190 countries working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world while periodically depending on the World Bank for its resources. Formed in 1944, started in 27 December 1945, at the Bretton Woods Conference primarily by the ideas of Harry Dexter White and John Maynard Keynes, it came into formal existence in 1945 with 29 member countries and the goal of reconstructing the international monetary system.

The Industries (Development and Regulation) Act, 1951, was enacted to provide for the development and regulation of certain industries.

The Fortune 500 is an annual list compiled and published by Fortune magazine that ranks 500 of the largest United States corporations by total revenue for their respective fiscal years. The list includes publicly held companies, along with privately held companies for which revenues are publicly available.

The cost per sale (CPS), also known as the pay per sale, is a metric used by advertising teams to determine the amount of money paid for every sale generated by a specific advertisement. Understanding and tracking the CPS allows advertisers to take steps to reduce their costs, thus increasing profit and optimizing productivity. The CPS can be calculated by dividing the total amount of money the company spent on the ad campaign (the cost) by the sum of all sales made.

The category development index (CDI) measures the sales performance of a category of goods or services in a specific group, compared with its average performance among all consumers. By definition, CDI measures the sales strength of a particular product category within a specific market (e.g., soft drinks in 10-50 year olds).

The breakeven point (BEP) for a trade or investment is determined by comparing the market price of an asset to the original cost; the breakeven point is reached when the two prices are equal. In corporate accounting, the breakeven point formula is determined by dividing the total fixed costs associated with production by the revenue per individual unit minus the variable costs per unit. In this case, fixed costs refer to those which do not change depending upon the number of units sold. Put differently, the breakeven point is the production level at which total revenues for a product equal total expenses.

The ATAR acronym (Awareness, Trial, Availability, Repeat), is based on the concept of 'Diffusion of Innovation'. For someone to be considered a reliable customer of a new product or service, they must first know it exists (Awareness). Once someone is aware of the existence of the new product, they need to opt to try it out (Trial). After someone has opted to try it out, they need to be able to actually purchase the product (Availability). If they are happy with the experience, they may adopt the product and become repeat buyers (Repeat).

The Analytic Hierarchy Process (AHP) is a method for organizing and analyzing complex decisions, using math and psychology. It was developed by Thomas L. Saaty in the 1970s and has been refined since then. It contains three parts: the ultimate goal or problem you're trying to solve, all of the possible solutions, called alternatives, and the criteria you will judge the alternatives on. AHP provides a rational framework for a needed decision by quantifying its criteria and alternative options, and for relating those elements to the overall goal.

The Alternative Investment Market (AIM) is a sub-market of the London Stock Exchange (LSE) that is designed to help smaller companies access capital from the public market. AIM allows these companies to raise capital by listing on a public exchange with much greater regulatory flexibility compared to the main LSE stock market.

SWOT (strengths, weaknesses, opportunities and threats) analysis is a method for identifying and analyzing internal strengths and weaknesses and external opportunities and threats that shape current and future operations and help develop strategic goals.

Supplier relationship management (SRM) is the systematic approach to evaluating vendors that supply goods, materials and services to an organization, determining each supplier's contribution to success and developing strategies to improve their performance. The SRM discipline helps to determine the value each supplier provides and which ones are most critical to business continuity and performance. It also enables managers to cultivate better relationships with suppliers based on each supplier's importance.

Social media optimization (SMO) is the use of social media networks to manage and grow an organization’s message and online presence. As a digital marketing strategy, social media optimization can be used to increase awareness of new products and services, connect with customers, and mitigate potential damaging news.

Social media marketing (SMM) is the use of social media platforms and websites to promote a product or service. Although the terms e-marketing and digital marketing are still dominant in academia, social media marketing is becoming more popular for both practitioners and researchers. Most social media platforms have built-in data analytics tools, enabling companies to track the progress, success, and engagement of ad campaigns. Companies address a range of stakeholders through social media marketing, including current and potential customers, current and potential employees, journalists, bloggers, and the general public.

Social media is a computer-based technology that facilitates the sharing of ideas, thoughts, and information through the building of virtual networks and communities. By design, social media is Internet-based and gives users quick electronic communication of content. Content includes personal information, documents, videos, and photos. Users engage with social media via a computer, tablet, or smartphone via web-based software or applications.

SEO stands for "search engine optimization". In simple terms, it means the process of improving your site to increase its visibility when people search for products or services related to your business in Google, Bing, Yahoo and other search engines. The better visibility your pages have in search results, the more likely you are to garner attention and attract prospective and existing customers to your business.

Search engine marketing (SEM) is a form of Internet marketing that involves the promotion of websites by increasing their visibility in search engine results pages (SERPs) primarily through paid advertising. SEM may incorporate search engine optimization (SEO), which adjusts or rewrites website content and site architecture to achieve a higher ranking in search engine results pages to enhance pay per click (PPC) listings.

Sales force automation (SFA) is when parts of the sales process are automated by software tools. The automation usually focuses on repetitive, administrative tasks that, while important, can be time-consuming for sales teams to perform.

Run of Network advertising is a form of internet marketing where an online advertising campaign is applied to a wide collection of websites without the ability to choose specified sites. An advertising network sells space for online ads to appear on a number of different websites, blogs and similar channels. A network may focus on a particular type of website such as games or entertainment, or represent several different categories. A run of network campaign is one in which the advertiser cannot choose to target specific parts of the network. Having a Run of Network option should result in lower prices than choosing sites specifically as the network can run on more sites and take advantage of extra inventory that might not be in as high demand.

Return on marketing investment or ROMI is a metric used in online marketing to measure the effectiveness of a marketing campaign. It examines results in relation to the specific marketing objective. ROMI is a subcategory of return on investment or ROI, because here the cost is incurred on marketing.

Research and development (R&D) includes activities that companies undertake to innovate and introduce new products and services. It is often the first stage in the development process. The goal is typically to take new products and services to market and add to the company's bottom line. The term R&D is widely linked to innovation both in the corporate and government world or the public and private sectors. R&D allows a company to stay ahead of its competition.

Resale Price Maintenance (RPM) is an agreement between a manufacturer and a wholesaler or retailer not to sell a product below a specified price.

Personal Identifiable Information (PII) is defined as any representation of information that permits the identity of an individual to whom the information applies to be reasonably inferred by either direct or indirect means. Further, PII is defined as information: (i) that directly identifies an individual (e.g., name, address, social security number or other identifying number or code, telephone number, email address, etc.) or (ii) by which an agency intends to identify specific individuals in conjunction with other data elements, i.e., indirect identification. (These data elements may include a combination of gender, race, birth date, geographic indicator, and other descriptors).

Pay Per Impression refers to an Internet marketing advertising model which defines how the payment will be done for every time client's advert is displayed. Through this method, the advertiser pays for the number of times the advertisement is displayed on the publisher’s website. Prices are generally set per one thousand page impressions.

Pay per action or PPA is a form of advertising that is closely related to pay per click or PPC, but with a very specific difference. That difference is that PPA means that you only pay when the user carries out a particular action.

Multilevel marketing (MLM) is a strategy some direct sales companies use to encourage existing distributors to recruit new distributors who are paid a percentage of their recruits' sales. The recruits are the distributor's "downline." Distributors also make money through direct sales of products to customers. Amway, which sells health, beauty, and home care products, is an example of a well-known direct sales company that uses multilevel marketing.

Marketing Authorisation Application (MAA) is an application submitted by a drug manufacturer seeking marketing authorisation, that is permission to bring a medicinal product (for example, a new medicine or generic medicine) to the market. MAA is part of the official procedure before the Medicines and Healthcare products Regulatory Agency in the United Kingdom and the Committee for Medicinal Products for Human Use of the European Medicines Agency, a specialised agency of the European Commission. In the United States, the equivalent process is called New Drug Application.

Market surveillance is the prevention and investigation of abusive, manipulative or illegal trading practices in the securities markets. Market surveillance helps to ensure orderly markets, where buyers and sellers are willing to participate because they feel confident in the fairness and accuracy of transactions.

Lifetime Value (LTV) is a prediction of the net profit attributed to an ongoing relationship between customer and product. By providing a running estimate on how much a particular consumer is likely to spend on that app, LTV helps set marketing budgets and ensures that companies pursue the most effective users. If a company can predict a user’s lifetime value successfully, it provides marketers with a much better base on which to make decisions - helping a company maximize the effectiveness of its advertising spending. The term itself is also known as customer lifetime value (CLV or CLTV) and lifetime customer value (LCV).

Integrated marketing communications can be defined as the process used to unify marketing communication elements, such as public relations, social media, and advertising, into a brand message that remains consistent across distinct media channels. It allows public and private organizations and businesses to deliver an engaging and seamless consumer experience for a product, service, or the organization itself. Professionals with a background in integrated marketing might pursue employment throughout the marketing and communications industries, in areas such as social media marketing, digital media, journalism, market research and consulting, public relations, non-profit and government, entertainment, television and radio, and other related fields.

In marketing, the unique selling proposition (USP), also called the unique selling point, or the unique value proposition (UVP) in the business model canvas, is the marketing strategy of informing customers about how one's own brand or product is superior to its competitors (in addition to its other values).

In business and engineering, new product development (NPD) covers the complete process of bringing a new product to market, renewing an existing product or introducing a product in a new market. A central aspect of NPD is product design, along with various business considerations. New product development is described broadly as the transformation of a market opportunity into a product available for sale. The products developed by an organisation provide the means for it to generate income. For many technology-intensive firms their approach is based on exploiting technological innovation in a rapidly changing market.

Fast-moving consumer goods are products that sell quickly at relatively low cost. These goods are also called consumer packaged goods. FMCGs have a short shelf life because of high consumer demand (e.g., soft drinks and confections) or because they are perishable (e.g., meat, dairy products, and baked goods). These goods are purchased frequently, are consumed rapidly, are priced low, and are sold in large quantities.