Transcript MR1100C3
The Changing
Marketing Environment
Chapter 3
The Uncontrollable Environment
This
chapter takes an in-depth look
at the uncontrollable marketing
environment in Canada today.
Organizations cannot effect the
marketing environment, instead they
are affected by it. Successful
organizations spot trends in the
environment and capitalise on these
trends.
The Environmental Forces
Remembering
from Chapter 1, The
uncontrollable factors include:
– Social Forces
– Economic Forces
– Technological Forces
– Competitive Forces
– Regulatory Forces
The Environmental Forces
Social
Forces
– Social forces relate to changes, and events that are
occurring in society. Key indicators of change are:
Demographic
Shifts
– Demographics is a study/measure of peoples ages,
sex, income levels, where they live, and ethnicity.
– Be aware or key terms such as Mature Housholds,
Baby Boomers, Generation X, Blended Families and
Regional Marketing.
Cultural
Changes
– Culture is a reflection of a societies shared values
and Beliefs. Attitudes are changing and so is the
makeup of our society. People are more conscious
of Value and the Natural Environment
The Environmental Forces
Economic
Forces
– Economics deals with issues of income
and expenditures in our society. Key
measures of change in economic
conditions arise from changes in:
The
Canadian economy at large
(macroeconomics)
Consumer Income
Gross
Income - Taxes = Disposable Income
Disposable Income - necessities =
Discretionary Income
The Environmental Forces
Technological
Forces
– Technology is changing faster than ever.
Witness how quickly your new computer
will become obsolete.
– This rapid change poses quite a large
challenge for many organizations.
E-Business
– The Internet has made doing business
anywhere & anytime possible.
The Environmental Forces
Competitive
Forces
– Competition refers to the number of
alternatives a consumer has when
buying a particular product or service.
There
are varying degrees of competitive
environments.
– Monopoly - No Competition - only one seller
– Oligopoly - Limited Competition - Two or three
sellers
– Monopolistic Competition - Many sellers offering
substitutable products (Coke, Pepsi, Orange
Juice)
– Pure Competition - Many sellers selling similar or
same products.
The Environmental Forces
Components of Competition
– Barriers to Entry
Competition
may affect a company’s ability to enter a
market easily. There may be many Barriers to Entry
in place to limit the growth of competition
Suppliers of raw material may help limit competition
in an industry by refusing to sell to a new entrant.
Buyers of products may aid in limited competition by
being reluctant to buy from an new entrant into the
market.
Competitors may try to limit competition buy forcing
new entrants out of the market.
Global Competition has helped to increase the overall
level of competition. Many companies are forming
world-wide partnerships called Strategic Alliances.
The Environmental Forces
Regulatory
Forces
– Regulation is a basic set of rules/laws set down
by either the industry in question (selfregulation) or by government that effects how
that business operates.
– Most regulation is designed to:
Protect Customers
Protect Competition
– To stem off government imposed regulation,
many industries have decided to self-regulate.
– Consumerism is a movement among consumers
to fight for better protection from bad or corrupt
business practices and bad products.