Transcript Chapter 4 - courses.psu.edu

The Marketing
Environment
Chapter 4
Objectives
Know the environmental forces
that affect the company’s ability
to serve its customers.
Realize how changes in the
demographic and economic
environments affect marketing
decisions.
4-1
Objectives
Identify the major trends in the
firm’s natural and technological
environments.
Know the key changes in the
political & cultural environments.
Understand how companies can
react to the marketing
environment.
4-2
c
Volkswagen
“Millennial fever” set
the stage to bring
back the VW Beetle
VW’s investment:
$ 560 million
Demand quickly
outstripped supply
The new VW beetle
enjoyed crossgenerational appeal
Earned many awards
VW’s Beetle now
accounts for over 25%
of company sales
Discussion: Is VW’s next nostalgia venture, the “flower-power”
Microbus, as likely to succeed?
4-3
Key Environments
Marketing Environment
 The actors and forces that
affect a firm’s ability to
build and maintain
successful relationships
with customers.
4-4
Key Environments
Aspects of the marketing
environment:
 Microenvironment:

Actors close to the company
 Macroenvironment

Larger societal forces
4-5
The Microenvironment
Departments within the company
impact marketing planning.
4-6
The Microenvironment
Suppliers help to create and deliver
customer value.
 Treat suppliers as partners.
4-7
The Microenvironment
Marketing intermediaries help to sell,
promote, and distribute goods.
 Intermediaries take
many forms.
 Resellers
 Physical
distribution firms
 Marketing services
agencies
 Financial
intermediaries
4-8
The Macroenvironment
Customer markets must be studied.
Market types





Consumer
Business
Government
Reseller
International
4-9
The Macroenvironment
Successful companies
provide better customer
value than the competition
 Size and industry position
help to determine the
competitive strategy.
4 - 10
The Macroenvironment
Various publics must also
be considered.
 Government
 Media
 Financial
 Local
 General
 Internal
 Citizen Action Groups
4 - 11
Figure 4-1:
Actors in the
Microenvironment
4 - 12
Figure 4-2:
Major Macroenvironmental
Forces
4 - 13
The Macroenvironment
Key Demographic Trends
 World population
growth
Now 6.2 billion
 Projected to
reach 7.9 billion
by 2025

4 - 14
The Macroenvironment
Key Demographic Trends
 Changing age structure

The U.S. population consists
of seven generational groups.
• Baby boomers, Generation X
and Generation Y are key
groups.

Distinct segments typically
exist within these generational
groups.
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The Macroenvironment
Key
Generations
Baby boomers
Generation X
Generation Y
Born between 1946
and 1964
Represent 28% of the
population; earn 50%
of personal income
Many mini-segments
exist within the
boomer group
Entering peak earning
years as they mature
Lucrative market for
travel, entertainment,
housing and more
4 - 16
Discussion Question
The “graying of America”
refers to the fact that as baby
boomers get older, the
average age of the U.S.
population increases.
Today, baby boomers are a
great target for exotic travel.
Think ahead to 20 years in
the future. For what types of
products and services will
baby boomers represent a
prime target?
4 - 17
The Macroenvironment
Key
Generations
Baby boomers
Generation X
Generation Y
Born between 1965
and 1976
First latchkey children
Maintain a cautious
economic outlook
Share new cultural
concerns
Represent $125 billion
in annual purchasing
power
Will be primary buyers
of most goods by 2010
4 - 18
Discussion Question
Generation X has been
described in the past as
“working to live” rather
than “living to work.”
Do you think that this
statement reflects
Generation X’s true
priorities in life?
Why or why not?
4 - 19
The Macroenvironment
Key
Generations
Baby boomers
Generation X
Generation Y
Born between 1977 and
1994
72 million strong;
almost as large a group
as their baby boomer
parents
New products,
services, and media
cater to Generation Y
Computer, Internet and
digitally saavy
Challenging target for
marketers
4 - 20
Figure 4-3:
Seven U.S. Generations
4 - 21
The Macroenvironment
Key Demographic Trends
 Changing American
household
 Geographic population
shifts
 Better-educated, more
white-collar workforce
 Increasing Diversity
4 - 22
BusinessNow
Zoots Video Clip
Working women
value products and
services that are
convenient to use
or that save time.
Click the picture above to play video
4 - 23
The Macroenvironment
The Economic Environment
 Affects consumer
purchasing power
and spending
patterns.
 U.S. consumers
now spend carefully
and desire greater
value.
4 - 24
The Macroenvironment
The Economic Environment
 Two types
of national
economies:
 subsistence
 industrial
4 - 25
The Macroenvironment
Key Economic Trends
 U.S. income distribution
is skewed.


Upper class, middle class,
working class, underclass
Rich: getting richer
Middle class: shrinking
Underclass: still poor
 Consumer spending
patterns are changing.
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The Macroenvironment
The Natural Environment
 Concern for the natural
environment has grown
steadily, increasing the
importance of these trends:



Shortage of raw materials
Increased pollution
Increased governmental
intervention
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The Macroenvironment
Many companies use recycling to help
protect natural resources
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The Macroenvironment
Key Technological Trends
 The technological environment
is characterized by rapid
change.
 New technologies create new
opportunities and markets but
make old technologies obsolete.
 The U.S. leads the world in
research and development
spending.
4 - 29
The Macroenvironment
The Political Environment
 Includes laws,
governmental
agencies, and
pressure groups
that impact
organizations and
individuals.
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The Macroenvironment
The Political Environment
 Key trends include:
Increased legislation to protect
businesses as well as consumers.
 Changes in governmental agency
enforcement.
 Increased emphasis on ethical
behavior and social responsibility.

4 - 31
The Macroenvironment
Cause-related marketing is one method
of demonstrating social responsibility
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The Macroenvironment
The Cultural Environment
 Is composed of institutions and
other forces that
affect a society’s
basic values,
perceptions,
preferences,
and behaviors.
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The Macroenvironment
The Cultural Environment
Core beliefs are
persistent
 Passed from parents
to children; reinforced
by society
 Shape attitudes and
behavior
Secondary cultural
values change and
shift more easily
Society’s cultural values
are expressed through
people’s views of:






Themselves
Others
Organizations
Society
Nature
The Universe
4 - 34
Responding to the
Marketing Environment
Reactive:
Passive Acceptance and Adaptation
 Companies design strategies that avoid
threats and capitalize upon opportunities.
Proactive:
Environmental Management
 Use of lobbyists, PR, advertorials, lawsuits,
complaints, and contractual agreements to
influence environmental forces.
4 - 35