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Copyright 1999 Prentice Hall

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Chapter 3

Chapter 3

The Global Marketing Environment

PRINCIPLES OF MARKETINGEighth Edition

Philip Kotler and Gary Armstrong


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Marketing EnvironmentMarketing Environment

• All the actors and forces influencing the company’s ability to transact business effectively with it’s target market.

• Includes:–MicroenvironmentMicroenvironment - forces close to the company

that affect its ability to serve its customers.

–MacroenvironmentMacroenvironment - larger societal forces that affect the whole microenvironment.


3-33-3The Marketing EnvironmentThe Marketing Environment

Company

Demographic

Economic

Natural

Technological

Political

Cultural Company

Customers

Intermediaries

Suppliers

Competitors

Publics


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The MicroenvironmentThe Microenvironment

CompanyCompany

CustomersCustomers

PublicsPublics Suppliers Suppliers

CompetitorsCompetitors IntermediariesIntermediaries

Forces Affecting a Company’s Ability to

ServeCustomers

Forces Affecting a Company’s Ability to

ServeCustomers


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The Company’s MicroenvironmentThe Company’s Microenvironment

• Company’s Internal EnvironmentCompany’s Internal Environment- functional areas such as top management, finance, and manufacturing, etc.

• SuppliersSuppliers - provide the resources needed to produce goods and services.

• Marketing IntermediariesMarketing Intermediaries - help the company to promote, sell, and distribute its goods to final buyers.


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The Company’s MicroenvironmentThe Company’s Microenvironment

• CustomersCustomers - five types of markets that purchase a company’s goods and services.

• CompetitorsCompetitors - those who serve a target market with similar products and services.

• PublicsPublics - any group that perceives itself having an interest in a company’s ability to achieve its objectives.


3-73-7Customer MarketsCustomer Markets

CompanyCompany

ConsumerMarkets

InternationalMarkets

GovernmentMarkets

BusinessMarkets

ResellerMarkets


3-83-8The MacroenvironmentThe Macroenvironment

DemographicDemographic

TechnologicalTechnological

CulturalCultural EconomicEconomic

PoliticalPolitical NaturalNatural

Forces that ShapeOpportunities

and Pose Threatsto a Company

Forces that ShapeOpportunities

and Pose Threatsto a Company


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The Company’s MacroenvironmentThe Company’s Macroenvironment

• DemographicDemographic - monitors population in terms of age, sex, race, occupation, location and other statistics.

• EconomicEconomic - factors that affect consumer buying power and patterns.

• NaturaNatural - natural resources needed as inputs by marketers or that are affected by marketing activities.


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Key U.S. Demographic TrendsKey U.S. Demographic Trends

Changing Age StructurePopulation is getting olderChanging Age StructurePopulation is getting older

Changing Family StructureMarrying later, fewer children,

working women, and nonfamily households

Changing Family StructureMarrying later, fewer children,

working women, and nonfamily households

Geographic ShiftsMoving to the Sunbelt and suburbs (MSA’s)

Geographic ShiftsMoving to the Sunbelt and suburbs (MSA’s)

Increased EducationIncreased college attendance

and white-collar workers

Increased EducationIncreased college attendance

and white-collar workers

Growing Ethnic and Racial Diversity73% Caucasian, 12% African-American,

10% Hispanic & 3.4% Asian

Growing Ethnic and Racial Diversity73% Caucasian, 12% African-American,

10% Hispanic & 3.4% Asian


3-113-11Economic EnvironmentEconomic Environment

Changesin Consumer

SpendingPatterns

Changesin Consumer

SpendingPatterns

EconomicDevelopment

EconomicDevelopment

Changes in Income

Changes in IncomeKey

EconomicConcerns for

Marketers

KeyEconomic

Concerns forMarketers


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Natural EnvironmentNatural Environment

Factors Affecting

the Natural

Environment

More GovernmentIntervention

More GovernmentIntervention

Shortages of Raw Material

Shortages of Raw Material

Increased Costsof Energy

Increased Costsof Energy

Higher PollutionLevels

Higher PollutionLevels


3-133-13The Company’sMacroenvironment

The Company’sMacroenvironment• TechnologicalTechnological - forces that create new

product and market opportunities.

• PoliticalPolitical - laws, agencies and groups that influence or limit marketing actions.

• CulturalCultural - forces that affect a society’s basic values, perceptions, preferences, and behaviors.


3-143-14Technological EnvironmentTechnological Environment

Rapid Pace of Change

Rapid Pace of Change

High R & D Budgets

High R & D Budgets

Focus on MinorImprovements

Focus on MinorImprovements

IncreasedRegulationIncreasedRegulation

Issues in the TechnologicalEnvironment

Issues in the TechnologicalEnvironment


3-153-15Political EnvironmentPolitical Environment

GreaterConcern for

Ethics

GreaterConcern for

Ethics

IncreasedLegislation

IncreasedLegislation

Changing Enforcement

Changing Enforcement

KeyTrends in the

PoliticalEnvironment

KeyTrends in the

PoliticalEnvironment


3-163-16Cultural EnvironmentCultural Environment

OfOrganizations

OfNature

OfOneself

OfSociety

Ofthe Universe

OfOthers

ViewsThat Express

Values

ViewsThat Express

Values


3-173-17Responding to the Marketing Environment

Responding to the Marketing Environment• Environmental Management Perspective Environmental Management Perspective

–Taking a proactive approach to managing the microenvironment and the macroenvironment to affect changes that are favorable for the company. How? Hire lobbyists , run “advertorials”, file law suits and complaints, and form agreements.