Transcript Marketing Chapter 3

Analyzing the Marketing Environment
 Famous photocopier
 Did not respond to the market environment change
 Immediate loss
 Adapted to the change
 Became leaders in the changed environment
 Micro and macro environments of the organization
 The company
 Suppliers
 Marketing intermediaries: they help find customers to
make sales
 Resellers
 Physical distribution firms
 Marketing service agencies
 Financial intermediaries
 Competitors
 Publics
 Customers
 Financial publics: banks, investment houses and
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stockholders
Media publics: newspaper, magazines, radio and tv
Government publics: ethics, product safety, etc.
Citizen-action publics: consumer organizations,
environmental groups, minority groups, labor activists.
Local publics: neighborhood residents and community
organizations.
General public
Internal publics: workers, managers, volunteers and board
of directors
 Consumer markets
 Business markets
 Reseller markets
 Government markets
 International markets
 The factors in macroenvironment shape opportunities
and pose threat for the company
 Remember the shortcut? PESTEL. For sake of this
course the new shortcut is PESTED. Where:
 P is for Political
 E is for Economical
 S is for Sociocultural
 T is for Technological
 E is for Environmental
 D is for Demographical
 Demography is the study of human populations in
terms of size, density, location, age, gender, race,
occupation and other statistics.
 Increasing population: high birth rates leading to
higher opportunities for products targeting infants.
 A growing middle-class: Indian perspective
 Deprived households: annual income less than Rs. 90,000
 Aspirers: annual income Rs. 90,000 to Rs. 200,000
 Seekers: Rs. 200,000 to Rs. 500,000
 Strivers: Rs. 500,000 to Rs. 1,000,000
 Global Indians: over Rs. 1,000,000
 Growth in the rural population
 Low purchasing power
 Lack of proper infrastructure (road, communication
connectivity, reliable source of electricity)
 a changing family system: nuclear family, both parents
working, no proper care for the elderly
Class debate:
Joint family system vs. Nuclear family system
 The changing role of women: many advertisements are
targeting working women. Sunsilk, Nesvita
 A better educated, more white-collared, more
professional population
 Increasing diversity
 Premium products like those of Apple suffer most with
economic downturn.
 The global financial crisis: 2007-2009 default on
mortgages.
 Changing income distribution and consumer spending
patterns: Ernst Engel and Engel’s laws.
Engel’s Laws: differences noted over a century ago by
Ernst Engel in how people shift their spending across
food, housing, transportation, health care, and other
goods and services categories as family income rises.
 The natural environment involves the natural
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resources that are needed as inputs by marketers or
that are affected by marketing activities.
Concentration of industries in a naturally rich location
endangers the environment.
Environmental concerns have grown over past years.
Shortage of raw materials…even air and water!
Increased pollutoin due to increased industries.
Increased government intervention: highly expensive
solutions to pollution problems
 Imagine a world with tiny transmitters carried by every
individual that tracks his/her buying behavior,
activities and interests.
 Presently, smart chips are used with products which
track down the inventory storage and usage in every
store.
 New technologies create new markets and
opportunities; however, every new technology replaces
the old one. Hence, marketers need to keep track of
technological changes in the environment to stay
ahead in the competition.
 Legislation: case study-the Sialkot soccer ball industry
and child labor
 Increased emphasis on ethics and socially responsible
actions
 Socially responsible behavior: organizational rules and
guidelines, internet piracy
 Cause-related marketing: most companies are linking
themselves to worthwhile causes. E.g. products donating
some amount per product they sell for cancer cause.
Starbucks help provide clean water to children who are
deprived of this ‘basic luxury’.
Cultural environment includes institutions and other
forces that affect society’s basic values, perceptions,
preferences and behaviors.
Core beliefs and values are passed from parents to
children and reinforced by schools, business and
government.
Secondary beliefs can be changed, and this is where
marketers play role.
 People’s views of themselves: do it yourself,
adventurers
 People’s views of others: socializing on internet, not
reality
 People’s views of society: patriotic, reformers,
malcontents.