1. 3- 1 Copyright © 2012 Pearson Education, Inc. Publishing as Prentice Hall i t ’s good and good for you Chapter Three Analyzing the Marketing Environment

2. 3-2 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall Analyzing the Marketing Environment The Company’s Microenvironment The Company’s Macroenvironemnt The Demographic Marketing Environment The Economic Environment The Natural Environment The Technological Environment The Political and Social Environment The Cultural Environment Responding to the Marketing Environment Topic Outline

3. 3-3 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Marketing Environment The marketing environment includes the actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with customers. These forces are: 1- Microenvironment 2- Macroenviornment To develop effective marketing strategies, companies must first understand the environment in which marketing operates.

4. 3-4 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Marketing Environment Microenvironment consists of the actors close to the company that affect its ability to serve its customers, the company, suppliers, marketing intermediaries, customer markets, competitors, and publics

5. 3-5 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Actors in the Microenvironment

6. 3-6 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Top management Finance R&D Purchasing Operations Accounting The Company Top management and other departments have an impact on the marketing department’s plans and actions. Under the marketing concept, all of these functions must “think consumer”.

7. 3-7 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment They Provide the resources needed by the company to produce goods and services Marketers must treat suppliers as partners to provide customer value Suppliers Supply shortages or delays, and Rising supply costs may harm the company’s sales volume.

8. 3-8 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Help the company to promote, sell and distribute its products to final buyers Marketing Intermediaries Coke delivers value for their marketing intermediaries. They understand each retailer partner’s business, conduct consumer research and share with partners, and develop marketing programs and merchandising for partners.

9. 3-9 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Resellers Physical distribution firms Marketing services agencies Financial intermediaries Types of Marketing Intermediaries

10. 3-10 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Types of Marketing Intermediaries Resellers are distribution channel firms that help the company find customers or make sales to them. Physical distribution firms help the company stock and move goods from their points of origin to their destinations. 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. 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.

11. 3-11 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Firms must gain strategic advantage by positioning their offerings against competitors’ offerings Competitors a company must provide greater customer value and satisfaction than its competitors do.

12. 3-12 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Publics Any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives –Financial publics (e.g. banks) –Media publics (e.g. newspapers, magazines, T.V.) –Government publics (control) –Citizen-action publics (e.g. consumer organizations) –Local publics ( neighborhood residents & organizations ) –General public (citizens as potential consumers) –Internal publics (e.g. workers, managers)

13. 3-13 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Microenvironment Consumer markets (individuals and households) Business markets: buy goods and services for further processing or use in their production processes, whereas reseller markets buy goods and services to resell at a profit. Government markets: government agencies that buy goods and services to produce public services or transfer the goods and services to others who need them. International markets: buyers in other countries, including consumers, producers, resellers, and governments. Customers

14. 3-14 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment The company and all of the other actors operate in a larger macroenvironment of forces that shape opportunities and pose threats to the company.

15. 3-15 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment

16. 3-16 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Demography: the study of human populations-- size, density, location, age, gender, race, occupation, and other statistics Demographic environment: involves people, and people make up markets Demographic trends: shifts in age, family structure, geographic population, educational characteristics, and population diversity Demographic Environment Changes in demographics mean changes in markets, so they are very important to marketers.

17. 3-17 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Generational marketing is important in segmenting people by lifestyle of life state instead of age Demographic Environment

18. 3-18 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment More people are: Divorcing or separating Choosing not to marry Choosing to marry later Marrying without intending to have children Increasing number of working women Increasing number of stay-at-home dads Increasing diversity Demographic Environment

19. 3-19 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Changes in the Workforce –More educated –More white collar Demographic Environment

20. 3-20 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment 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 Economic Environment

21. 3-21 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Value marketing offering financially cautious buyers greater value— the right combination of quality and service at a fair price Economic Environment

22. 3-22 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Natural environment: natural resources that are needed as inputs by marketers or that are affected by marketing activities Trends –Increased shortages of raw materials –Increased pollution –Increased government intervention –Increased environmentally sustainable strategies Natural Environment

23. 3-23 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Technological Environment Most dramatic force in changing the marketplace New products, opportunities Concern for the safety of new products

24. 3-24 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Political environment laws, government agencies, and pressure groups that influence or limit various organizations and individuals in a given society Political and Social Environment

25. 3-25 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Legislation regulating business –Increased legislation –Changing government agency enforcement Increased emphasis on ethics –Socially responsible behavior –Cause-related marketin g Political and Social Environment

26. 3-26 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Cultural environment consists of institutions and other forces that affect a society’s basic values, perceptions, and behaviors Cultural Environment Cultural factors strongly affect how people think and how they consume. So marketers are keenly interested in the cultural environment.

27. 3-27 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall The Company’s Macroenvironment Core beliefs and values are persistent and are passed on from parents to children and are reinforced by schools, churches, businesses, and government Secondary beliefs and values are more open to change and include people’s views of themselves, others, organization, society, nature, and the universe Cultural Environment Persistence of Cultural Values

28. 3-28 Copyright © 2012Pearson Education, Inc. Publishing as Prentice Hall Responding to the Marketing Environment Uncontrollable React and adapt to forces in the environment Proactive Aggressive actions to affect forces in the environment Reactive Watching and reacting to forces in the environment Views on Responding Rather than simply watching and reacting, companies should take proactive steps with respect to the marketing environment.