marketing environment - class2

8/10/2019 Marketing Environment - Class2

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MARKETING ENVIRONMENT

Dr M Manjunath Shettigar


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It is useless to tell a river to stop

running; the best thing is to learnhow to swim in the direction it is

flowing.

-Anonymous


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Actors in the

Microenvironment


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Marketing must consider other parts of the organization

including finance, R&D, purchasing, operations and

accounting

Marketing decisions must relate to broader companygoals and strategies

Microenvironment

1

The company


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The Company

Marketing managers must work with all

departments of a company

All Departments have an impact on the

marketing departments plans and actions

Think Customer


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Provide resources

needed to produce

goods and services.

Important link in the

value delivery

system.

Most marketers treatsuppliers like partners.

Suppliers:


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Competitors

To be successful, a company must satisfyneeds and wants of consumers better than

competitors A company should monitor three variables

when analyzing each of its competitors

Share of Market

Share of Mind

Share of Heart


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Competitors

Must understand competitors strengths

Must differentiate firms products and

offerings from those of competitors

Competitive strategies should emphasize

firms distinctive competitive advantage in

marketplace


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Types of Publics


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Demographic Environment

Demography is the study of human populations in

terms of size, density, location, age, gender, race,

occupation, and other statistics

Demographics change over time and companies

must keep up with them


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Global EconomicDevelopment

Changes in Income

Changing ConsumerSpending Patterns

KeyEconomic

Concerns forMarketers

Economic Environment


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Economic Factors

(a)Gross national product.(b)Per capita income.

(c)Balance of payments position.

(d)Industry life cycle and current phase through which the

industry is passing. The different phases of this life cyclecould be classified as recovery, boom, recession anddepression.

(e)Trends in the prices of goods and servicesspecifically,whether the inflationary or deflationary trends are visible.

(f)Fiscal policies and prime rate of interest charged bycommercial banks.


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Natural Environment

Involves the natural

resources that are

needed as inputs bymarketers or that are

affected by marketing

activities.


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Natural Environment

Natural Environment:

Involves the natural resources that are needed

as inputs by marketers or that are affected bymarketing activities

Trends

Shortages of raw materials Increased pollution

Increased government intervention

Goal 3: Identify trends in natural and technological environments


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Technological Environment

Most dramatic

force now

shaping our

destiny.


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Technological Forces

Changes in technology may make

business obsolete; e.g.,

buggy whips (automobile)

airport at Gander, Newfoundland

(longer range aircraft)

Federal Express (fax machine;

Internet)

New opportunitiese.g., specialtyonline retailers, mass

customization


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Cultural Environment

The institutions and

other forces that

affect a societysbasic values,

perceptions,

preference, andbehaviors.


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Marketing Management

Themselves Identify with

brands for self-expression

Others Recent shift from

me to wesociety

Organizations Trend of decline in

trust and loyaltyto companies

Society Patriotism on the

rise

Nature lifestyles of health

and sustainability(LOHAS) consumersegment

Universe Includes religion

and spirituality

Cultural EnvironmentIncludes peoples views of

Goal 4: Explore political and cultural environments


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Increasing

Legislation

ChangingGovernment

AgencyEnforcement

Includes Laws, Government Agencies, Etc. that Influence& Limit Organizations/ Individuals in a given society

IncreasedEmphasis on

Ethics &

SociallyResponsible

Actions

Political Environment


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Political Trends

Increased legislation and regulationaffecting business

Changing government Agency Enforcement

Increased emphasis on socially responsibleactions and ethics


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Legal and Regulatory

Environment Laws and Regulations

for safety

for consumer protection

to protect special interests

Dangers of litigation--anyone can sue,and juries often buy it!

Examples:

Antitrust Fair competition

Pricing

Truth in Lending--have to tell peoplereal costs of financing; car leases now

regulated


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The Marketing Environment and

Competitor Analysis

SWOT analysis

PEST analysis

Five forces analysis


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SWOT analysisStrengths (internal)

Weaknesses (internal)

Opportunities (external)

Threats (external)


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PEST analysis Political factors

Economic factors

Socio-cultural factors

Technological factors


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Political/legalMonopolies legislation

Environmental protection laws

Taxation policy

Employment laws

Government policyLegislation

Others?


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Economic FactorsInflation

Employment

Disposable income

Business cycles

Energy availability and cost

Others?


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Sociocul tural facto rs

Demographics

Distribution of income

Social mobility

Lifestyle changes

ConsumerismLevels of education

Others?


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Five forces model is a environment analysis

tool developed by famous strategy Guru

Michael Porter

The 5 forces he speaks about are:

Completive rivalry in the industry

Bargaining power of buyers Bargaining power of suppliers

Threat of new entrants

Threat of substitute products

Fi f l i


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Source: Adapted from M. E. Porter,

Competitive Strategy, Free Press,

1980, p. 4.

Threat of

substitutes

Threat of

New entrants

SuppliersBargaining

power

BuyersBargaining

power

COMPETITIVERIVALRY



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Environmental Scanning and

Analysis

SCANNING ANALYSIS

ACTION


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Environmental Scanning

Determine Environmental Areas That Need

to Be MonitoredDetermine How the Information Will Be Collected

Implement the Data Collection Plan

Anaylze and Use the Data in Planning


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THANKS.

marketing environment - class2

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