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MKT 230: Sustainable Marketing Module 6

Terms in this set (46)

Marketing channels
the means whereby goods, services, and value move between producers and consumers.
Value chain
the chain of activities and institutions that add value to a product on its way from manufacture to its end consumer
Throughput system
a linear view of a system, in which materials come in and go out, with no accounting for the materials' ultimate origination or destination
Linear Flows and Waste
waste is a major cause of costs and problems in marketing channels
Cradle to Cradle
philosophy, championed by Michael Braungart and William McDonough, holds that all industrial waste can and should be eliminated by making sure that all of it either serves as biodegradable nutrients for natural systems (biosphere) or is reclaimed for reuse in human technological systems (technosphere).
Technosphere
human-made technological systems
Cradle-to-cradle certification
third-party assurances that products are designed to be reabsorbed by nature or the technosphere at end of life and that they are produced with renewable energy, efficient use of water, and fair treatment of people
Design for disassembly
design that allows products to be more easily and safely reduced to their component materials at end of life
Reverse logistics
the systematic movement of waste backward through marketing channels, in order to convert it back into usable raw materials
Value circles
closed-loop value chains that include end users as suppliers of raw materials and component parts for manufacturers
Secondary markets
markets that provide used or surplus goods at prices that are usually well below initial retail prices
Channel power
the relative influence of one member of the marketing channel over the actions or circumstances of other members
Upstream channel members
a company's supply chain
Downstream channel members
a company's customers and their customers, on down to final consumers of the company's product
Transparency
the extent to which an organization's operations and practices are open and visible to outside observers; a key element in sustainable marketing
Chain of custody
the documented ability to trace the movement and possession of materials from their current places back to their origins
External audits
audits wherein third-party certifiers observe and document business practices for compliance with standards that are typically voluntary
Sustainable distribution
emphasizes efficiency and carbon neutrality, prioritizes local production, incorporates material backflows from consumers to manufacturers, and helps convert refuse to resources, allowing manufacturers to replace virgin materials with recyclables more easily
Disintermediation
reducing the number or roles of intermediaries in a marketing channel
Influencing Suppliers
Retailers are, by their nature, customers for all their upstream channel members. As customers, they choose the kinds of product and service assortments that they will offer to their own customers.
Educating Consumers
One of the most important ways retailers can help bring about a more sustainable society is by educating their customers about the advantages of buying more sustainable goods and services.
Merchandising
The processes and techniques used by retailers to communicate with customers, including product displays, signage, sampling, and décor.
Taking Back Recyclables
Retail stores can provide ideal sites for consumers to return used products and packaging, thus keeping them in the value circle. Because consumers are going to stores already, with space in their vehicles reserved for their purchases, it's convenient to carry along reclaimable waste.
Price
monetary value of a product as agreed upon by a buyer and a seller
Cost
sum of money, time, and resources associated with a purchase or an activity
Sustainable price
a price that accounts fully for the economic, environmental, and social costs of a product's manufacture and marketing while providing value for customers and a fair profit for business
Externalized costs
negative impacts of economic activity that are borne by people not directly involved in or benefiting from the activity
Total product costs
costs that include all direct (e.g., materials and labor) and indirect costs (e.g., company overhead) of a product for purposes, such as inventory valuation, profitability analysis, and pricing
Life-cycle costing
the attempt to account for all costs associated with a product throughout all stages of its life
Purchase costs
all the costs to a customer, including money and time, of searching for and acquiring a product
Product-use costs
all the costs incurred for using a product, including maintenance, wear and tear, energy, and supplies
Disposition costs
any cost incurred for the disposal of a product, including fees for trash hauling, recycling, or other post use collection
Storage costs
any costs incurred for the storage of product not in use, including fees for rent and transportation
Competitive Barriers
to price a product voluntarily in such a way as to internalize, rather than externalize, environmental and social costs is market suicide if competitors are not willing or obliged to do the same thing for equivalent products
Political Barriers:
the political barrier lies in the fact that democratic governments tend to lack the will to enact any legislation that raises consumer prices
Cultural Barriers
current lifestyles, values, and expectations are deeply ingrained and difficult to change
Cost-based pricing
determining a product's price by adding a fixed amount or a percentage to the product's cost
Tiered pricing
charging different prices in different countries or markets according to consumers' ability to pay
Market-skimming pricing
setting high initial prices for new products in order to recover maximum revenues before substitutes appear in the market
Value-based pricing
pricing set according to the value customers perceive a product to have
Market-penetration pricing
setting initial prices artificially low in order to speed up sales of a new product
Prestige pricing
setting and maintaining a high price on a product in order to convey an image of higher quality or desirability
Complementary currencies
nonmonetary means of paying for goods and services
Bartering
the direct trading of goods and services without using money as an exchange medium
Local Exchange Trading Scheme (LETS)
community-based networks of people that trade goods and services, often by listing "wants" and "offers" in local directories
Time banks
also called service exchanges; barter systems that allow participants to provide and receive services using time spent as expertise
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