Marketing Glossary to Sound Smart
Sound like the smartest person in the room with these business and marketing terms.
Updating all the time! Last update 10/23
The action bias is our habit of choosing to do something rather than nothing, even if it might not be the best choice.
Sometimes, we just feel the need to act, even when there’s no real reason to believe it’ll make things better. So basically, we’re wired to jump into action mode, even when chilling out might be the smarter move.
I see this a lot when sales are stagnant and leadership wants to take action and dump a bunch of money and resources into a brand new ad campaign or a new website. When in reality, that’s not what’s needed at all. But it feels like something needs to happen, it’s just misguided – which ties into Iatrogenic Marketing below.
We have limited capacity in our working memory. We have 3 categories of “stuff” to process when learning something…or consuming your marketing messaging.
Intrinsic: This is the actual material to be learned. For example, if I need to learn GA4, then the intrinsic load is all the stuff I need to know. Can’t really change the facts. You can divide the info into snackable bites, but the info is the info.
Extraneous: This is the stuff that drives me crazy. Every try to do anything on a government website? You can’t find it…have to click all over the place. This is just useless added frustration. Or the never-ending automated phone systems when you just need to talk to a human.
Think about your customer journey. Where do you have a bunch of red tape or steps that just aren’t needed. Or what about gating your content with a form a mile long? Why are you adding to the cognitive load?
Germane: This is the good stuff. This is where you tie what you’re trying to communicate with what matters the listener.
How can you tie what you sell to your ideal customers in a way that they can understand? How can you meet them where they are to help them make meaning from your content?
For example, this is one of the reasons I love including jobs-to-be-done in marketing messaging. You are directly speaking about what jobs your ideal customer has to do…which will resonate with them. You are showing that your info is germane to them.
If you have an issue in your foundation, the taller the building gets, the bigger that issue becomes. 1” turns into several feet until it eventually all falls apart. Think of it as compounding interest but with inefficiencies instead of money.
Concept that if you’re not very good at something, you’re also not very good at recognizing that. It explains why people who are unskilled in a particular area sometimes rate their own ability higher than more competent people. (over-confident and under-competent)
False Proxy Trap
Sometimes, we can’t measure what we need, so we invent a proxy, something that’s much easier to measure and stands in as an approximation.
False Proxy Trap in Marketing Example:
Situation: An e-commerce site aims to boost sales.
Proxy: The marketing team equates higher website traffic with increased sales.
Strategy: They launch a broad online ad campaign, which successfully brings more visitors.
Result: Traffic surges, but sales don’t match the increase. The conversion rate even drops.
Analysis: The team mistakenly focused on sheer visitor numbers instead of the quality or relevance of the traffic. They assumed all traffic would lead to sales, which wasn’t the case.
When a measure becomes a target, it ceases to be a good measure.
It always takes longer than you expect, even when you take into account Hofstadter’s Law.
Ever heard of an iatrogenic illness? It’s when a doctor, with the best intentions, tries to help but ends up making things worse. Kinda like when you go to fix a leaky faucet and suddenly there’s water everywhere.
Think about it like this: imagine hiring a marketing guru to boost your business. But instead of giving it a boost, they drop the ball and things go downhill. That’s a bummer, right?
Here’s the kicker: just like you’d start doubting that doctor who didn’t help, businesses can lose faith in those consultants. So, whether it’s health or business, getting the right advice matters. Let’s always strive to be on point and trust but verify!
The persistent inability to believe that one’s success is deserved or has been legitimately achieved as a result of one’s own efforts or skills.
Law of Diminishing Returns
A principle stating that profits or benefits gained from something will represent a proportionally smaller gain as more money or energy is invested in it.
Opportunity cost is the value of the next-best alternative when a decision is made; it’s what is given up.
Usually referred to at the 80/20 rule – for many events, roughly 80% of the effects come from 20% of the causes (80% of the revenue from 20% of the clients; 80% of the problems from 20% of the clients – not necessarily the same ones).
Work expands so as to fill the time available for its completion.
The Peter Principle is a concept introduced by Dr. Laurence J. Peter in his 1968 book “The Peter Principle.”
Basically, employees tend to rise to their “level of incompetence.”
An individual will keep getting promoted until they reach a position where they are no longer competent.
Once they’re in a role where they can’t perform effectively, they typically stop being promoted and remain stuck in that position.
The principle suggests that, over time, every position in a larger organization will be filled by someone who is not competent to fulfill their duties, leading to organizational inefficiency.
Social loafing is when you’re working in a group and some people don’t try as hard because they think others will pick up the slack. It’s like when you’re in a group project at school and a couple of friends let you do most of the work. They’re “loafing” around, thinking you’ve got it covered. Remember, everyone’s got a part to play, so let’s step up and give our best, together!