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SCANNING THE MARKETING ENVIRONMENT C HAPTER. External Marketing Environment Demographics Social Change Social Change Economic Conditions Economic Conditions.

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Presentation on theme: "SCANNING THE MARKETING ENVIRONMENT C HAPTER. External Marketing Environment Demographics Social Change Social Change Economic Conditions Economic Conditions."— Presentation transcript:

1 SCANNING THE MARKETING ENVIRONMENT C HAPTER

2 External Marketing Environment Demographics Social Change Social Change Economic Conditions Economic Conditions Political & Legal Factors Political & Legal Factors Technology Competition EnvironmentalScanning Target Market Product Distribution Promotion Price Product Distribution Promotion Price External Environment is not controllable Ever-ChangingMarketplace

3 An environmental scan of today’s marketplace

4 A lack of time to do anything but work, commute to work, handle family situations, do housework, shop, eat, sleep... Social Forces- The Poverty of Time

5 SOCIAL FORCES- Demographics Implications?  The World Population at a Glance – 6.4 billion Growth in developing nations Shift of age structure of populations Rising income levels and living standards

6  The U.S. Population – 297 Million  Growth by immigration = niche markets  Generational Cohorts Baby Boomers-‘46-’64 Baby Boomers-‘46-’64 Generation X-’65-’76 Generation X-’65-’76 Generation Y-’77-’94 Generation Y-’77-’94 - (Millennials) techno-savvy, live for today -Increased earnings-seek youth -Well educated, more tolerant, practical Social Forces - Demographics

7 SOCIAL FORCES Demographics  Population Shifts toward West & South – Why? Metropolitan Statistical Area – % Metropolitan Statistical Area – % 50,000- urban center; suburban collar up to 2.5M Ex-Chicago Micropolitan Statistical Area % Micropolitan Statistical Area % 10,000-50,000 urban center; large suburb collar Ex-Carbondale

8 ECONOMIC FORCES -Economy Macroeconomic Conditions –Inflation-rise in prices without rise in wages –Recession-drop in income, production and employment Microeconomic Conditions –Consumer Income Gross Income – 100% of earnings Disposable Income-85% of earnings Discretionary Income-15% of earnings

9 ECONOMIC FORCES Implications?  Disposable vs Discretionary income

10 Income Distribution of U. S. Households

11 New technology is a weapon against inflation and recession U.S. excels at basic research Japan excels at applied research Information technology and the Internet have increased productivity Technological Factors

12 COMPETITIVE FORCES -Competition

13 REGULATORY FORCES Protecting Competition  Sherman Antitrust Act (1890) – no monopolies  Clayton Act (1914)- no monopoly activity  Robinson-Patman Act (1936)- no differential pricing to undercut “little” guy

14 REGULATORY FORCES  Company Protection Patent Law Patent Law -for ideas and inventions Product-Related Regulation Copyright Law Copyright Law -for written works Digital Millennium Copyright Act (1998) Digital Millennium Copyright Act (1998) -for DVD’s, MP3’s & software

15 REGULATORY FORCES  Consumer Protection Nutritional Labeling & Education Act (1990) Nutritional Labeling & Education Act (1990) The above and other laws came about due to cultural shift towards Consumerism Product-Related Regulation Consumer Product Safety Act (1972) Consumer Product Safety Act (1972)  Consumer Product Safety Commission Consumer Product Safety Commission

16 REGULATORY FORCES Advertising and Promotion-Related Legislation Penalties are: Cease and Desist Order Corrective Advertising Corrective Advertising  FTC Act of 1914-no deceptive ads or practices  Do Not Call Registry  Children’s online privacy Protection Act 1998  CAN-SPAM Act (2004)

17 Environmental Scanning Environmental scanning is the process of continually acquiring information on events occurring outside the organization to identify and interpret potential trends.

18 Demographics Demographics describes a population according to selected characteristics such as age, gender, ethnicity, income, and occupation.

19 Baby Boomers Baby boomers is the generation of children born between 1946 and 1964.

20 Generation X Generation X includes the 15% of the U.S. population born between 1965 and 1976.

21 Generation Y Generation Y includes the 72 million Americans born between 1977 and 1994.

22 Culture incorporates the set of values, ideas, and attitudes that are learned and shared among the members of a group. Culture

23 The economy pertains to the income, expenditures, and resources that affect the cost of running a business and household. Economy

24 Technology refers to inventions from basic engineering research or innovations from applied science research. Technology

25 Competition refers to the alternative firms that could provide a product to satisfy a specific market’s need. Competition

26 Consumerism is a grassroots movement started in the 1960s to increase the influence, power, and rights of consumers in dealing with institutions. Consumerism


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