Transcript mmi-iii-market-environment-analysis-16-18

Marketing Environment Analysis
The Company’s Macro and
Microenvironment
Analyzing the Marketing Environment
• A company’s marketing environment consists
of actors and forces outside marketing that
affect marketing management’s ability to
build and maintain successful relationships
with target customers.
Companies need to constantly watch and
adapt to the changing environment.
• Marketers need to be environmental trend
trackers and opportunity seekers.
2 special aptitudes of Marketers which equip
them for the task :
• Major tools : Marketing research and
Marketing intelligence.
• Time spent in customer and competitor
environments.
Need for an Marketing Information
System ( MIS)
A MIS consists of people, equipment and procedures to gather,
sort, analyze, evaluate, and distribute needed, timely and accurate
information to marketing decision makers.
It relies on :
•
Internal company records
• Marketing intelligence activities
•
Marketing research
Internal Records
• The Order – to payment Cycle
• Sales Information Systems
• Databases ( Customer, product and
salesperson combined), Data Warehousing
and Data Mining
Sources of the MIS
• Sales force
• Distributors, retailers and other intermediaries
• Hiring of external experts to collect
intelligence
• Network internally and externally
• Customer Advisory panels
• Government data
• Outside suppliers like Ac Nielsen- ORG MARG
or TAM Media Research
Marketing Intelligence from the Internet
• Customer Goods and Services Review Forums
• Distributor or sales Agent feedback sites
• Combo sites giving customer reviews and expert
opinions
• Customer complaint sites
• Public blogs
Marketing Environment
Micro environment : Company, suppliers,
marketing intermediaries, customer markets,
competitors and publics. Many of these actors
can be controlled/influenced by the company
with its own actions, and hence can also be
called controllable factors.
Macro environment : Consists of larger societal
factors that affect the microenvironment :
Demographic ,economic, natural, technological,
political and cultural forces which cannot be
controlled by the company , at least in the short
run. These are the uncontrollable factors.
The Company’s Microenvironment
Marketing Management’s task is to build
relationships with customers by creating
customer value and satisfaction.
Major actors in the Marketer’s
Microenvironment
To succeed marketers would need to build
relationships with :
Other company departments( Internal
environment)
Suppliers ( Important link in the company’s value delivery
system)
Marketing intermediaries ( Resellers, physical
Distribution firms, marketing service agencies, and
financial intermediaries). Currently viewed as partners.
Customers ( Consumer markets, business
markets, reseller markets, Government markets,
international markets)
Competitors
Various publics constituting the company’s
value delivery network ( Financial, media,
government, citizen – action, Local, general,
internal)
The Company
Suppliers
They provide the resources needed by the
company to produce goods and services. Supplier
problems can seriously affect Marketing.
Marketing Managers must watch supply
availability and costs.
Supply shortages or delays, labour strikes and
other events can cost sales in the short run.
Rising supply costs may force price increases that
can harm the company’s sales volumes.
Today suppliers are treated as partners in
creating and delivering customer value.
Marketing Intermediaries
• Marketing intermediaries help the company
to promote, sell, and distribute its goods to
final buyers. They include resellers, physical
distribution firms, marketing services
agencies, and financial intermediaries.
• Resellers are distribution channel firms that help the
company find customers or make sales to them. These
include wholesalers and retailers, who buy and resell
merchandise. Selecting and working with resellers is
not easy.
• No longer do manufacturers have many small,
independent resellers from which to choose. They now
face large and growing reseller organizations. These
organizations frequently have enough power to dictate
terms or even shut the manufacturer out of large
markets.
• Physical distribution firms help the company
to stock and move goods from their points of
origin to their destinations. Working with
warehouse and transportation firms, a
company must determine the best ways to
store and ship goods, balancing factors such as
cost, delivery, speed, and safety.
• Marketing services agencies are the marketing
research firms, advertising agencies, media
firms, and marketing consulting firms that
help the company target and promote its
products to the right markets.
• When the company decides to use one of
these agencies, it must choose carefully
because these firms vary in creativity, quality,
service, and price.
• Financial intermediaries include banks, credit
companies, insurance companies, and other
businesses that help finance transactions or
insure against the risks associated with the
buying and selling of goods.
• Most firms and customers depend on
financial intermediaries to finance their
transactions.
• Like suppliers, marketing intermediaries form
an important component of the company's
overall value delivery system. In its quest to
create satisfying customer relationships, the
company must do more than just optimize its
own performance.
• It must partner effectively with marketing
intermediaries to optimize the performance of
the entire system.
• Today's marketers recognize the importance of working
with their intermediaries as partners rather than
simply as channels through which they sell their
products.
• For example, Coca-Cola recently signed a 10-year deal
with Wendy's that will make Coke the exclusive soft
drink provider to the fast-food chain, picking up more
than 700 Wendy's franchises that were previously
served by Pepsi.
• In the deal, Coca-Cola promised Wendy's much more
that just its soft drinks. It pledged the powerful
marketing support that comes along with an exclusive
partnership with Coke.
Customers
• The company needs to study its customer
markets closely. There are five types of customer
markets:
• Consumer markets consist of individuals and
households that buy goods and services for
personal consumption.
• Business markets buy goods and services for
further processing or for use in their production
process, whereas reseller markets buy goods and
services to resell at a profit.
• Government markets are made up of government
agencies that buy goods and services to produce
public services or transfer the goods and services
to others who need them.
• International markets consist of these buyers in
other countries, including consumers, producers,
resellers, and governments. Each market type has
special characteristics that call for careful study
by the
Types of Customer Markets
Competitors
• The marketing concept states that to be
successful, a company must provide greater
customer value and satisfaction than its
competitors do.
• Thus, marketers must do more than simply adapt
to the needs of target consumers. They also must
gain strategic advantage by positioning their
offerings strongly against competitors' offerings
in the minds of consumers.
• No single competitive marketing strategy is
best for all companies. Each firm should
consider its own size and industry position
compared to those of its competitors. Large
firms with dominant positions in an industry
can use certain strategies that smaller firms
cannot afford.
• But being large is not enough. There are
winning strategies for large firms, but there
are also losing ones. Small firms can develop
strategies that give them better rates of return
than large firms enjoy.
Publics
PUBLICS
The company's marketing environment also includes various publics. A public
is any group that has an actual or potential interest in or impact on an
organization's ability to achieve its objectives.
There can be 7 kinds of publics :
Financial publics: influence the company's ability to obtain funds. Banks,
investment houses, and stockholders are the major financial publics.
Media publics: carry news, features, and editorial opinion. They include
newspapers, magazines, and radio and television stations.
Government publics: Management must take
government developments into account. Marketers
must often consult the company's lawyers on issues of product
safety, truth in advertising, and other matters.
Citizen action publics :A company's marketing decisions
may be questioned by consumer organizations, environmental groups,
minority groups, and others. Its public relations department
can help it stay in touch with consumer and citizen groups.
Local publics: include neighborhood residents and community organizations.
Large companies usually appoint a community relations officer to deal with the
community, attend meetings, answer questions, and contribute to worthwhile
causes.
General public: A company needs to be concerned about the general public's
attitude toward its products and activities. The public's image of the company
affects its buying.
Internal publics: include workers, managers, volunteers, and the board of
directors. Large companies use newsletters and other means to inform and
motivate their internal publics. When employees feel good about their
company, this positive attitude spills over to external publics
The Company’s macroenvironment
Analyzing the Macroenvironment
Successful companies recognize and respond profitably
to unmet needs and trends and distinguish between a:
Fad : Unpredictable, short lived and without social,
economic and political significance eg The Rubix cube,
the Hula Hoop
Trend : More predictable and durable than a fad.
eg A trend towards health.
Megatrend : A large. social, political and technological
change. Slow to form but a 7 -10 year movement .eg
Urbanization
Putting it all together through an
example
• Explosive population growth ( demographic)
leads to more resource depletion and
pollution ( natural) which leads consumers to
call for more laws ( political – legal), which
stimulates new technological solutions and
products ( technological) that, if they are
affordable,( economic)may actually change
attitudes and behaviour( socio – cultural)
Demographic Environmment
• Demography is the study of human
populations in terms of size, density, location,
age, gender, race, occupation, and other
statistics. The demographic environment is of
major interest to marketers because it
involves people, and people make up markets.
• The world population is growing at an explosive rate.
It now totals more than 6.8 billion people and will
exceed 8.1 billion by the year 2030. Major
contributors are countries in the Indian sub
continent.
• The explosive world population growth has major
implications for business. A growing population
means growing human needs to satisfy.
• Depending on purchasing power, it may also mean
growing market opportunities. However, the world’s
large and highly diverse population poses both
opportunities and challenges.
Implications for business
Changes in the world demographic environment have major
implications for business. Eg in China where government
regulation 25 years ago ( in order to combat skyrocketing
population ) restricted families to one child each.
This had resulted in the creation of little emperors and little
empresses doted upon owing to the “six pocket syndrome”–
attention and luxuries showered upon them by 2parents and
4 doting grandparents.
Implications for Marketing
• The Indian subcontinent also has a proportionately
large population of children. In Pakistan young people
14 years and younger comprise close to 40% of the
population, out of which nearly 14% are 4years old or
younger.
• There is a 173 million strong young people presence as
a business opportunity for Marketers. Thus, P & G
launched its world famous disposable diapers brand in
Pakistan in Aug 2000. At that time cloth nappies were
in general use.
Clever Marketing
P & G’s strategy was :
a ) Directed towards mothers of new borns through hospital
education programmes.
b) Since a significant percentage of births were in homes
instead of hospitals, Pampers also tried to reach families that
lived in low income, hard to reach areas through mobile
clinics that provided baby care education.
The strategy has been highly successful and P& G has
garnered significant market share.
• Thus Marketers keep close track of
demographic trends and their markets, both
at home and abroad. They track changing age
and family structure, geographic population
shifts , educational characteristics, and
population diversity.
Important demographic trends in the sub
continent
• Increasing population
• A Growing middle class
• Growth in the Rural population
• A Changing family system
• The changing role of women
• A better educated, more white collared , more
professional population
• Increasing diversity
Increasing population
• Main characteristic of the Asian population is the
rapid growth in the urban population. According
to Haruhiko Kuroda, President of the Asian
Development Bank.
• 1.1 billion people in Asia will move to cities in the
next 20 years .He adds that by 2030 half of the
population of the continent will live in cities.
In India nearly 2/3rds of the total population
increase over the next 20 years will occur in
urban areas. The population in urban areas will
rise from 29 % today to 37 %.( From 318 million
to 523 million).
Urban India is already more populous today
than the US and will exceed the current
population of the EU by 2025.
A growing middle class
The Indian population consists of several
income groups divided in to 5 by Mckinsey
Global Institute ( MGI) based on their real
annual disposable incomes
• Deprived households ( Annual disposable income
( ADI) of less than 90,000 per annum)
• Aspirers ( ADI between 90,000 to 2,00,000)
• Seekers ( ADI between 2,00,000 to 5,00,000 )
• Strivers ( ADI between 5,00,000 to 10,00,000)
• Global Indians ( Over 10,00,000 )
• Deprived households : Poorest economic
class. Mostly unskilled or semi – skilled
workers working on daily wages, may not have
all year round employment.
• Aspirers : Spend almost half their income on
basic necessities. Small time retailers, small
farmers, and low- skilled industrial workers.
• Seekers : White collar employees, mid-level
government officials, newly employed young
post graduates, medium –scale traders and
business people.
• Strivers : Established professionals like lawyers,
CAs, MBAs, senior government officials, medium
scale industrialists in towns,rich farmers in
villages.
People in this category and above are generally
considered successful and well – established in
Indian society. They have a stable source of
income and amenities or luxuries such as their
own home, car, TV, refrigerator and airconditioner at home.
• The middle class is defined as a combination
of Seekers and Strivers falling between the
income bracket of 2,00,000 to 10,00,000.
• The middle class consists of 7 million
households today and is forecasted to have 87
million households by 2025. These households
are enjoying an increase in annual income by
4.9 per cent. If an Average household is
pegged at 4.4 family members this adds up to
384 million people.
• Global Indians : This is the creamy layer and
consists of senior corporate executives, large
business owners, topmost professionals,
politicians, film actors and big farmers.
• Of late this has been joined by upwardly mobile
mid- level executives of MNCs , investment
bankers, and graduates from IITs and IIMs. Made
up of globe trotters who enjoy a very high
standard of living.
Rural Population
• India has about 639,000 villages where 743 million
people reside accounting for about 72% of India’s
population.
• About 62% of villages have less than 1000 people. And
only 3 % have a population of more than 5000 people.
• Most villages with less than 500 people do not have
any shops.
• Young adults between 20 -35 constitute 25 % of the
rural population and the age group 5 to 14 accounts for
another 25%.
Growth in the Rural population
• The MGI Consumer demand model has
forecasted that the population in Rural India
will be 906 million by 2015.
• The demand in Rural India is expected to
grow at an annual compound rate of 5.1%
during the next 15 years. By 2025, rural
consumption will nearly triple creating a
market of over 26 trillion rupees. This BOP will
see consumption growth on a per household
basis.
Main constraint for Marketers in Rural
Markets
• Is not purchasing power alone but a combination of
several other factors such as lack of proper
infrastructure such as roads and telecommunication
connectivity, reliable supply of electricity which
affects distribution infrastructure such as cold
storage.
• With G.O.I developing this infrastructure the rural
market will come closer to the urban market.
There are similar challenges for marketers in
Pakistan and Bangladesh.
• Unilever subsidiaries have drawn on successful
elements of Project Shakti of HUL in India
empowering women entrepreneurs and launched
similar programmes in these countries.
A Changing family system
• Today’s India is rapidly abandoning the traditional
joint family system, partly out of necessity. Both
husband and wife work. They may not live with
their parents.
• The nuclear family takes the help of baby sitters
and crèches to look after the kids when parents
are out earning. The dual income single kid
( DISK) family has created a dent in the social
fabric of Indian society.
• The + ive side is the increase in family income and
hence increase consumption and demand. The young
couple, no longer supervised, have freedom and can
eat whatever they want and spend in whichever way
they wish to, living life their own way.
• India has moved into an era where the wife and
mother – in - law are both working and may no longer
be available to the new generation of kids in the family.
• Also, the husband and wife , both being career –
oriented, marriages have become more fragile. As a
result, the urban nuclear family is splitting
• Growing number of nuclear families has led to
the problem of old, retired and sometimes
invalid parents. Young couples , busy making
their own careers, either in the country or
abroad are too busy to look after their parents.
• Thus, how to take care of the rising number of
older people is emerging as a major concern.
(Only 4% of the 80 million Indians aged over 60
receive a pension).
The changing role of women
• Till 3 decades ago the primary role of women in
the subcontinent was to look after the house.
Very few would study beyond high school and
complete their graduation .Today more and more
women, even in rural India, are completing
graduation and even postgraduation.
• Women have emerged to work shoulder to
shoulder with men in education, companies,
space research organizations , banks etc. Many
women head organizations.
A better educated , more white collared , more professional
population
Provision of education has been one of the topmost
priorities and social objectives of GOI.As a result of
government spending, the Indian population is becoming
better educated.
This increase in number of educated people will increase
the demand for quality products, books, magazines, travel,
personal computers, and Internet services.
The workforce is also becoming more white collar . Job
growth is now strongest for professional workers and
weakest for manufacturing workers.
Increasing Diversity
• Countries vary widely in their ethnic and racial
make –up. The US is a melting pot of many
nationalities and cultures. In contrast Japan
has almost all Japanese.
• With increasingly diverse markets, most large
companies are targeting specially designed
products , ads and promotions to one or more
ethnic groups.
Economic Environment
Economic environment consists of factors that
affect consumer purchasing power and
spending patterns
• Industrial economies are richer markets
• Subsistence economies consume most of their
own agriculture and industrial output.
• In between are developing economies which
can offer outstanding marketing opportunities
for the right kinds of products.
• India’s growing middle class and rapidly rising
incomes make it an attractive market for
many. European, North American and Asian
automakers are introducing smaller, more
affordable vehicles in India since only 1 in 7
Indians owns one.
• The last few years have seen many ups and
downs in the economic landscape of the world
and also in countries in the Indian
subcontinent.
• The global financial crisis of 2007-2009 swept
away many of the gains made by economies
in several years of steady growth. These
economic trends have impacted heavily on the
consumption of goods and services across the
subcontinent.
Major economic events and trends
• The US economic crisis of 2007-2009 was
triggered off by subprime housing loans extended
by overambitious bankers to consumers who did
not have the capacity to service them.
• When real estate prices collapsed in the US many
customers defaulted on these loans. Many of
these loans had been repackaged by banks and
sold onwards to investment bankers, insurance
companies and other financial institutions in the
US and also all over the developed world.
• These eventually led to the collapse of Wall
street icons such as Lehman Bothers , Merrill
Lynch and others. Some like AIG were bailed
out by huge injections of money from the US
government.
• Most stock markets in the world including the
Indian subcontinent crashed and lost billions
of rupees in capitalization. Banks stopped
lending and there was a huge liquidity crunch.
Ford , General Motors received bailouts from
the US Government. But the developed world
went into a major recession.
When America sneezes the rest of the world
catches a cold.
Countries like Pakistan, Sri Lanka and the Maldives
were most hit. India with a robust economy fared
better. Even so demand for housing, construction
,IT, and consumer durables was hurt. GDP for 2008
was downgraded two points to 7 percent and
forecasts for 2009 were pegged at 5 %.
This significant drop in GDP growth rates in the
subcontinent has impacted the consumption of
many products and services.
However, these Governments have successfully
used fiscal and monetary instruments to
revive their economies.
• Marketers brought in new low- priced versions
of their products , providing trade and
customer discounts and by using finer
segmentation and targeting of consumers.
Citibank in Pakistan lost buyers for its very
successful consumer credit portfolio. In the US
even Apple sales growth and stock
performance took a beating.
Changing Income Distribution and
Consumer spending patterns
• Food, housing and transportation use up the
maximum household income. But consumers
at different income levels have different
spending patterns, noticed by Ernst Engels
about a century and a half ago. Engels studied
how people shifted their spending as their
incomes rose.
• Engels found that as family income rises the
percentage spent on food declines .
• The percentage spent on housing remains the
same ( Except for utilities such as gas,
electricity, and public services, which
decrease)
• Both the percentage spent on most other
categories and that devoted to savings
increase. Engel’s Laws ( 1857) have been
generally supported by late studies.
• Prior to the recent global crisis many sub
continent countries were enjoying an enviable
economic development. They are expected to
regain their earlier pace of development in a few
years. The sustained growth has changed the
income distribution of household significantly,
giving rise to a growing and more affluent urban
middle class.
• In Pakistan, as well as India, the distribution of
income has led to a tiered market. ( Thus
Mercedes Benz eyes the moneyed class, Tata
Motors targets those with modest means. The
Nirmas and the Ghadis go for the least affluent
sections).
• Changes in the income, cost of living ,interest
rates, saving and borrowing patterns have a large
impact on the marketplace. Companies watch
these variables for economic forecasting.
• Moral of the story : Businesses do not have to be
wiped out by economic downturns or taken by
surprise in a boom. With adequate warning they
can take advantage of changes in the economic
environment.
NATURAL ENVIRONMENT
• The natural environment includes the natural resources
that are needed as inputs by marketers or that are
affected by marketing activities.
• Industries cluster in a region based on natural
resources. Concentration of industries can be a cause
for concern and a threat to the environment.
• Air and water pollution have reached dangerous levels
in many cities round the world. World concern
continues to escalate about possibilities of global
warming and many environmentalists fear we will soon
be buried under our own trash.
Trends in the Natural Environment
• Shortages of raw materials
• Increased pollution
• Increased government intervention
Green movement
• Concern for the environment has spawned the so
called Green Movement. Companies are today
developing strategies and practices that
support environmental sustainability – an effort
to create a world economy that the planet can
support indefinitely.
• Eg, GE uses “Ecomagination” to create products
for a better world- cleaner aircraft engines,
cleaner locomotives, cleaner fuel technologies.
• Other companies are developing recyclable or
bio- degradable packing, recycled materials
and components, better pollution controls
and more energy efficient operations. eg HP is
pushing legislation to force recycling of old
TVs, computers and other electronic gear.
• Companies are today looking to do more than
just good deeds. They increasingly recognize
the link between a healthy ecology and a
healthy economy. They are learning that
environmentally responsible actions can also
be good business.
Technological Environment
• The technological environment is the most
dramatic force now shaping our destiny.
• Take antibiotics, robotic surgery, miniaturized
electronics, laptops and the Internet to name
a few wonders.
• On the dark side, nuclear missiles, chemical
weapons, assault rifles.
• Also, technology has given us mixed blessings
such as the automobile, TV, credit cards.
• Our attitude towards technology rests upon whether
we are more impressed with its wonders or blunders.
• RFID .( Radio frequency identification) is the new kid on
the block). This can be embedded in the products you
buy. Beyond benefits to consumers – such as showing
product deals, suggesting accompanying for his use,
totalling his purchases and automatically charging
them to his credit card, scanning the RFID chip also
gives producers and retailers an amazing way to track
their products electronically anywhere in the world.
• New technologies create new products and
opportunities. However, every new
technology replaces an older technology.
• Transistors hurt the vacuum tube industry,
xerography hurt the carbon paper business,
CDs hurt phonograph records, digital
photography hurt the film business.
• When old industries fought or ignored new
technologies, their businesses declined. Thus
modern marketers must keep a hawk eye on
the technological environment.
• Companies that do not, will find soon their
products updated and they will miss new
product and market opportunities
• Today’s research is carried out by research
teams not by lone inventors. Many companies
are adding marketing people to R &D teams to
obtain a stronger marketing orientation.
• The challenge in any innovation is to make it
not only technical but commercial. – to make
it a practical, affordable version of the product
As products and technology become more complex the public
needs to know these are safe. Thus government agencies
investigate and ban potentially unsafe products. Eg in India, the
Food and Drugs Administration (FDA)has set up complex
regulations for testing new drugs.
The Consumer Protection Acts sets safety standards for
consumer products and penalizes companies that fail to meet
them. Hence higher research costs and longer times between
new product ideas and their introduction. Marketers need to be
aware of these while applying new technologies and developing
new products
Political and Social Environment
• The political environment consists of laws,
government agencies and pressure groups
that influence or limit various organizations
and individuals in a given society.
• Owing to ever increasing globalization
companies are now affected by the sociopolitical environment not only of their own
country but also of other countries with
whom they trade.
• Changes in tariffs , quotas,or even sentiments
of civil society might have a direct impact on
their profitability or even survival. Marketers
need to be keenly conscious of the changing
sociopolitical environment to seek out
opportunities and handle potential threats.
Major trends
• The world including India has seen increasing
legislation to cover competition, fair trade
practices, environmental protection, product
safety, truth in advertising, consumer privacy,
packaging and labeling, pricing and other
important areas.
• Overlaps between local , state and national
laws make interpretation of laws a difficult
task. Also, regulations change and marketers
must keep abreast of these changes
Broad purpose of laws
a) To protect companies from each other.
b) To protect consumers from unfair business
practices
c) To protect the interests of society against
unrestrained business behaviour.
Various enforcement agencies exist
• In the US you have federal regulatory
agencies such as :
• Federal State Commission
• Food and Drug Administration
• Federal Communication Commission
• The Federal Energy Regulatory Commission
• The Federal Aviation Administration
• The Consumer Product Safety Commission
• The Environmental Protection Agency
In India, food companies need special
approval to launch duplicate brands, such as
another cola drink or a brand of rice.
A legislation passed in 2001 makes it
mandatory for packaged food manufacturers
to have green dots and red dots on vegetarian
and non vegetarian products respectively
Thus Marketers need to know about major
laws protecting competition consumers and
society. They need to understand these laws
at the local, state, national and international
levels.
Non Tarrif barriers in trade
• Although WTO has been very active in
reducing tariff and non tariff barriers in
international trade, pressures from civil society
groups in the developed world have resulted in
a set of hurdles for companies operating in the
sub continent.
• This is in the form of social compliance
regulations which exporting companies have
to adhere to.
• These do not take into account the ground
realities of developing countries and also
increase costs for them .They also indirectly
hurt the intended beneficiaries. Marketers
must pre – empt the concerns of international
buyers before a crisis situation is reached.
Increased emphasis on Ethics and
socially responsible action
Many companies are today encouraging their
managers to look beyond what the regulatory system
allows and simply “do the right thing”.
Many industrial and professional trade organizations have
suggested codes of ethics and companies have
developed policies and guidelines for complex social
responsibility issues.
With internet marketing and tele calling privacy issues
have also come into play. Consumer advocates and
policymakers have also stepped into the picture to deal
with these.
Cause related Marketing
• To exercise social responsibility and build
more positive images many companies have
linked themselves to worthwhile causes.
• Eg
Buy a pink mixer from Kitchen Aid and
support breast cancer
Purchase Ethos water from Starbucks and help
children round the world.
• Purchase CRY cards and money will be used
for the protection of children’s rights
Cause related marketing
Has stirred some controversy. Critics claim that
Cause related marketing is more a strategy for selling
than a strategy for giving.
However, if handled well , cause related can greatly
benefit both the company and the cause. The
company gains an effective marketing tool while
building amore positive public image. The charitable
organization or cause gains greater visibility and
important new sources of funding and support.
SOCIO - CULTURAL ENVIRONMENT
• The socio -cultural environment is made up of
institutions and other forces that affect a
society’s basic values, perceptions,
preferences and behaviours.
Major trends observed today
• Persistence of core beliefs and values passed
on from parents to children .Eg Most Asians
believe in working, getting married, giving to
charity and have strong faith in religion.
• These beliefs are and reinforced by schools,
religious institutions, business and
government.
• Secondary beliefs and values are more open
to change.
• Thus believing in marriage is a core belief.
Getting married early is a secondary belief.
• Or believing in religion is a core belief.
Believing your dress must reflect your
religosity is a secondary belief.
• Marketers have some chance of changing
secondary beliefs but very unlikely to change
core beliefs. Thus a family planning marketer
would argue more effectively that people
should marry late rather than not get married
at all.
Shifts in Secondary Cultural Values
• In India colonial rule left its imprint upon dress
codes, leisure activities, and job preferences.
In addition, exposure to T.V., cinema , books
and magazines has had its effect cultural
values and outlook of younger people in the
subcontinent.
Other opportunities for Marketers
A ) People’s views of themselves
Eg For one who considers himself an adventurous type,
Master Card says” There are some things in life that
money can’t buy. For everything else there’s Master card”.
B) People’s views of others - tendency to” cocoon” has been
noticed in past decades. People don’t want to go out so
much with others. They want to enjoy home comforts
from a networked home office, to home entertainment
centres, to finding a quiet spot to plug into their iPods while
they check into their favourite web hangouts.
Thus DVD players, broadband, video games have
proliferated. Thus less demand for theatre going and
greater demand for home improvement.
C) People’s views of Organizations
Many people see organizations not as a source of
satisfaction but a necessary chore to earn money to enjoy
their non work hours. Hence organizations need to find
new ways to win consumer and employee
confidence through marketing themselves better.
“Customer engagement” is the new mantra
D) People’s View of Society eg Marketing keeping the
patriotic angle in mind eg done by political parties,
Bollywood films and Marketers using Independence day
themes, channels etc.
E) People’s View of Nature - eg Marketing
natural, organic, nutritional products, fuel
efficient cars and alternative to those following
Lifestyles of Health and Sustainability ( LOHAS.)
F) People’s View of the Universe : Renewed belief
in spirituality , yoga etc. Affects Books that people
read and services they buy. Also permeates TV.
Eg Baba Ramdev ,Aaastha channel
Moral of the story
• While a company would have little success in
trying to influence geographic population
shifts or the economic environment or major
cultural values, a smart marketing manager
will take a proactive rather than a reactive
approach to the marketing environment