Transcript 1133273874_334248

Introduction
to
Chapter 4: The Marketing
Environment
Designed & Prepared by Laura Rush
B-books, Ltd.
Copyright Cengage Learning 2013
All Rights Reserved
1
Learning Outcomes
LO1
Discuss the external environment of marketing,
and explain how it affects a firm
LO2
Describe the social factors that affect marketing
LO3
Explain the importance to marketing managers of
current demographic trends
LO4
Explain the importance to marketing managers of
multiculturalism and growing ethnic markets
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Learning Outcomes
LO4
Identify consumer and marketer reactions to the
state of the economy
LO4
Identify the impact of technology on a firm
LO4
Discuss the political and legal environment of
marketing
LO4
Explain the basics of foreign and domestic
competition
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Factors in the External
Environment
• Understanding current customers.
• Understanding what drives consumer
decisions.
• Identifying the most valuable customers and
understanding their needs.
• Understanding the competition.
LO1
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The Influence of Values on
Buying Habits
Ranked Characteristics of Product Quality
Reliability
Durability
Easy maintenance
Ease of use
Trusted brand name
Low price
LO2
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Component Lifestyles
The practice of choosing goods
and services that meet one’s
diverse needs and interests
rather than conforming
to a single, traditional lifestyle.
LO2
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Role of Families and Working Women
• Growth of dual-income families results in
increased purchasing power
• Approximately 59% of work-age females
are in the workforce
• Working wives bring in 45 percent of the
total family earnings.
LO2
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Tweens
• Pre- and early adolescents, age 8 to 12
• Population of 20 million
• Direct purchasing power of $50 billion in
2010
• View TV ads as “just advertising”
• Want to have control over experiences
LO3
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Teens
• Population of 25 million in U.S.
• Approximately 72 hours per week tuned in
electronically
• 73 percent of teens are active in social
networking
• 91 percent prefer to have real friends over
online friends
• 62 percent love to shop
LO3
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Generation Y
• Born between 1979 and 1994
• Largest cohort: more than 75 million
members
• Purchasing power of $200 billion annually
• Currently in several different life stages,
from mid teens to early thirties
LO3
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Generation X
• Born between 1965 and 1978
• Population of 40 million
• Savvy and cynical consumers
• Protective and involved with their kids
• Value the importance of education
• Avid buyers of the latest clothes,
technology, and recreational products
LO3
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Baby Boomers
• Born between 1946 and 1964
• Population of 75 million
• Boomers are postponing retirement – The 2007-2009
downturn has resulted in loss of $2 trillion.
• Income will continue to grow as they keep working
• Confident, socially conscious group that believes old age
starts at 80.
LO3
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Growing Ethnic Markets
• Spending power of ethnic markets in 2013:
– Hispanics--$1.4 trillion
– African Americans—$1.2 trillion
– Asian Americans--$752 billion
• Diversity can result in bottom-line benefits
to companies.
LO4
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Economic Factors
Consumer’s
Income
Inflation
Recession
LO5
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Purchasing Power
Purchasing Power- A comparison
of the relative cost of a set
standard of goods and services in
different geographic areas.
LO5
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Research
Basic research – pure research that
aims to confirm an
existing theory
or to learn more about a concept
or phenomenon
Applied research – an attempt to develop
new or improved products
LO6
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Technological Factors
•
Innovation is becoming a global process.
•
The most innovative firms have an average
profit margin growth of 3 percent higher
than the typical firm.
LO6
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Political and Legal Factors
Laws and Regulations Protect:




LO7
New technology
Society
Businesses
Consumers
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Consumer Privacy
Government Actions
Federal
Level
State
Level
LO7
 Gramm-Leach-Bliley Act
 Health Insurance Portability and
Accountability Act (HIPPA)
 California’s Notice of Security
Breach Law
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Competitive Factors
Competition for Market
Share and Profits
Global Competition
• More foreign firms
are entering U.S. market.
• Firms must work harder to
maintain profits and market
share.
• Foreign firms in U.S. now
compete on product
quality.
LO8
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