Business terms. Basic concepts for an entrepreneur

Key business terms and concepts that shape modern business

As an entrepreneur with many years of experience, I often find that sometimes simple words and business terms can become a real trap. You know how it goes: someone throws out ‘cross-channel marketing’ at a meeting, and everyone starts nodding as if they understand. But to be honest, how many of us really understand what we’re talking about?

Business terms can give us confidence and help us look competent. But it’s important not only to throw them around in a conversation, but also to understand what they mean. If you don’t know the true meaning, you can easily get lost in the maze of words and, in the end, make the wrong decisions.

When you run your own business, the cost of a mistake can be high. That’s why it’s so important to understand every word you use. This helps you not only manage your business better, but also communicate with your team and clients on the same level, achieving real results.

I’ve created a glossary of business terms for you that can really lead to a dead end if you don’t understand their true meaning.

Product DNA

This is not just a trendy term that is part of a businessman’s vocabulary. Product DNA is the fundamental essence of your offer, the invisible code that defines what makes your product unique, desirable and inimitable in the market. It’s like your brand’s signature, which distinguishes it from dozens, if not hundreds, of other offers.

Imagine a product without its DNA. It’s like a body without a soul – it may look good, but it won’t have any meaning. Your product DNA defines why your product is chosen by consumers and why they will return to it again and again.

Coca-Cola

Happy rivals, team participation, not victory ? The advert is dedicated to this year’s Olympic Games in Paris 2024

Mapping

Mapping is a technique that helps you visualise and structure different aspects of your business or process. It involves creating maps, charts or diagrams to visually represent data, processes or customer journeys.

Personally, I use it in strategy sessions with clients, it’s a powerful visual tool, and I often use the Miro app for this purpose.

In business, mapping is often used to analyse customer experience, where customer journey maps are created to show how customers interact with your product or service from start to finish. It helps to identify problem areas, improve processes, and understand customer needs.

In addition, mapping can be used to create a market or competitive environment map, which allows you to see the location of competitors, their strengths and weaknesses, and opportunities for your business.

Here is an example of such a card ‘Motivation system for salespeople’

Use it! ?

Benchmarking

Benchmarking is when you look at how the top companies in your industry, or even your competitors, are doing and compare their results with your own. It’s like peeping into the homework of excellent students to understand how you can become better yourself.

You analyse their processes, approaches, ideas and look for what works best for them. And then you adapt these best features to your reality to take your game to the next level.

MVP (Minimum Viable Product)

An MVP or minimum viable product is the most basic version of your product that includes only those features necessary for its basic functioning. In other words, it’s a simplified version of the product that allows you to enter the market and see if there is interest in your idea without spending large resources on development.

Think of an MVP as an experimental prototype. It’s a starting point for testing your product, allowing you to get feedback from users and assess how well your idea meets their needs. Instead of spending a lot of time and money on creating a full-fledged product, you develop a simplified version of it to help you understand whether your idea has potential.

Points of Differentiation

Points of differentiation are the special characteristics of your product or service that distinguish it from the competition. It’s what makes your product unique and attractive to consumers and helps you stand out in the marketplace. Think of points of differentiation as what makes your offering special and worthwhile.

Cross-Channel Marketing

Cross-channel marketing is a strategic approach that involves using several different channels to achieve a single marketing goal. Instead of limiting yourself to just one channel, you embrace a variety of platforms and ways to interact with your customers, such as social media, email, websites, mobile apps, and even physical stores.

You may remember that I used to host a show called ‘Money at Your Feet: 20 Sales Channels’, if you don’t know where the audience is hiding, or you just forgot which channels it is exactly on, you can watch the broadcast by following the link in the bot ? here

This approach allows you to create a more consistent and integrated impression of your brand, providing customers with the same experience and message no matter where and how they interact with your company.

Lifecycle Stages

Lifecycle stages are a concept that helps you understand the different stages a product or company goes through from inception to completion. Understanding these stages can help you manage development and marketing more effectively, adapt strategies and maximise success.

The main stages of the product lifecycle:

• Development.

This is the initial stage when a product is just being developed. This is where research, planning and testing are carried out to validate the idea and make sure it meets the needs of the market.

• Implementation

The product is launched on the market. During this period, the company actively promotes the product to attract the attention of potential customers and create a first impression. Usually, marketing costs are high at this stage, and profits are not yet significant.

• Growth.

The product becomes popular and begins to generate revenue. Sales are increasing, and the company can start to lower prices or launch new advertising campaigns to drive even more growth. This is also the time when the first competitors appear.

• Maturity.

The product reaches the peak of its life cycle. Sales stabilise, competition increases, and the market becomes saturated. Companies usually focus on maintaining competitiveness by updating or improving the product.

• Decline.

Sales begin to decline due to market saturation or the emergence of new, more innovative products. Companies may decide to cut costs, cease production, or find new ways to extend the life of the product.

• Withdrawal from the market

A product is no longer profitable and it is decided to stop selling it. This can be due to obsolescence or replacement by a new product. It is important for a company to plan for this stage to minimise losses.

Inbound marketing

This is a modern approach to customer acquisition that focuses on creating useful content and resources that capture the attention of potential customers without making a direct sale.

The main idea is to engage and interest the audience through valuable content and resources, instead of imposing advertising messages on them.

Inbound marketing focuses on making your company or product attractive to potential customers through:

Outbound marketing

Outbound marketing is a good old-fashioned advertising method that has existed since the days before the Internet. This is when you actively ‘go out’ with your message and try to reach potential customers through various channels – from tablets and banners to billboards and cold calls. It is important not so much to set up personalised communication as to reach a wide audience.

The whole point of outbound marketing is that your message should ‘catch’ as many people as possible, even if they were not looking for what you offer.

Native Advertising

Native advertising is that tricky thing that looks like it’s part of the content you’re already consuming, rather than a typical intrusive advert. Instead of shouting ‘Buy me!’, it is seamlessly integrated into the platform environment, be it a website, social media or video.

That’s what makes it so great: it doesn’t annoy or distract because it’s perceived as something organic. Such ads are more like tips or useful articles, which makes them less noticeable as advertising, but effective at the same time.

P.S. Terminology as a success factor

A business dictionary can help an entrepreneur look professional and modern. However, it’s worth remembering that true business success is not only achieved through the use of words by ear, but rather through the ability to understand and adapt these concepts to your strategy.

It is not enough to know what business is. Knowledge without understanding can be a hindrance, but a clear understanding of these metrics and their proper application will help you achieve your goals.

I will help you launch your own startup at WOW Mentor, if you feel that your idea is ready to be released, write to me, come to a free 15-minute session, go to the ‘Services section’ ?