THE MARKETING ENVIRONMENT 11/15/2018 THE MARKETING ENVIRONMENT Kotler, P. & Armstrong, G., 2006, Principles of Marketing, New Jersey: Pearson Education, Inc., Ch.3

OBJECTIVES OF THE SESSION MARKETING ENVIRONMENT 11/15/2018 OBJECTIVES OF THE SESSION After attending the session, students should be Able to: Describe the environmental forces that affect the company’s ability to serve its customers. Explain how changes in the micro- as well as macro-environmental forces affects marketing decisions.

Marketing Environment 11/15/2018 Marketing Environment Marketing Environment- consists of the actors and forces outside marketing that affect marketing management’s ability to develop and maintain successful relationships with its target customers. Includes: Microenvironment - forces close to the company that affect its ability to serve its customers. Macroenvironment - larger societal forces that affect the microenvironment.

The Company’s Micro-environment MARKETING ENVIRONMENT 11/15/2018 The Company’s Micro-environment Company’s Internal Environment- functional areas inside a company that have an impact on the marketing department’s plans. Suppliers - provide the resources needed to produce goods and services and are an important link in the “value delivery system”. Marketing Intermediaries - help the company to promote, sell, and distribute its goods to final buyers. i.e. resellers.

Company’s Internal Environment MARKETING ENVIRONMENT 11/15/2018 Company’s Internal Environment

The Company’s Micro-environment MARKETING ENVIRONMENT 11/15/2018 The Company’s Micro-environment Customers - five types of markets that purchase a company’s goods and services. Competitors - those who serve a target market with similar products and services against whom a company must gain strategic advantage. Publics - any group that perceives itself having an interest in a company’s ability to achieve its objectives.

Types of Customer Markets MARKETING ENVIRONMENT 11/15/2018 Types of Customer Markets Reseller Markets Business Markets Government Markets Consumer Markets International Markets Company

Types of Publics Company Citizen Action Publics Government Local MARKETING ENVIRONMENT 11/15/2018 Types of Publics Citizen Action Publics Government Publics Local Publics Media Publics General Public Financial Publics Internal Publics Company

Major Forces in the Company’s Macro-environment MARKETING ENVIRONMENT 11/15/2018 Major Forces in the Company’s Macro-environment

The Company’s Macro-environment MARKETING ENVIRONMENT 11/15/2018 The Company’s Macro-environment Demographic - studies populations in terms of size, density, location, age, gender, race, occupation and other statistics. Economic - factors that affect consumer purchasing power and spending patterns. Natural - natural resources needed as inputs by marketers or that are affected by marketing activities.

The Company’s Macro-environment MARKETING ENVIRONMENT 11/15/2018 The Company’s Macro-environment Technological - forces that create new technologies, creating new product and market opportunities. Political - laws, agencies and pressure groups that influence and limit organizations and individuals in a given society. Cultural - institutions and other forces that affect a society’s basic values, perceptions, preferences, and behaviors.

Responding to the Marketing Environment 11/15/2018 Responding to the Marketing Environment Environmental Management Perspective Taking a proactive approach to managing the microenvironment and the macro-environment by taking aggressive (rather than passive) actions to affect the publics and forces in the marketing environment. How? Hire lobbyists , run “advertorials”, press law suits, file complaints, and form agreements.

Marketing INTELLIGENCE SYSTEM MARKETING ENVIRONMENT 11/15/2018 Marketing INTELLIGENCE SYSTEM Marketing Intelligence System is a set of procedures and sources managers use to obtain everyday information about developments in the marketing environment. How to improve the quality of marketing intelligence: Train & motivate sales force to spot & report new developments. Motivate distributors, retailers, & other intermediaries to pass along important intelligence. Network externally Set up a customer advisory panel Take advantage of government data resources Purchase information from outside suppliers Use online customer feedback systems to collect competitive intelligence

Marketing INTELLIGENCE SYSTEM MARKETING ENVIRONMENT 11/15/2018 Marketing INTELLIGENCE SYSTEM Internal Recods The Order-to-Payment Cycle Sales Information Systems Databases, Data Warehouse, and Data Mining