marketing principles 03

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Marketing Principles

The Marketing Environment

BY

Syed Ghous Ali Shah

Email: [email protected]

Class BBA

Session 3

mailto:[email protected]

mailto:[email protected]



Marketing Environment

• The marketing environment consistsof actors and forces outside theorganization that affectmanagement’s ability to build andmaintain relationships with target

customers.

• Environment offers bothopportunities and threats.

• Marketing intelligence and researchused to collect information about theenvironment.



• Includes:

– Microenvironment: actors close to the company

that affect its ability to serve its customers.

– Macroenvironment: larger societal forces that

affect the microenvironment.• Considered to be beyond the control of the

organization.




The Company’s Microenvironment

•Company’s Internal Environment:

– Areas inside a company.

– Affects the marketingdepartment’s planning strategies.

– All departments must “thinkconsumer” and work together toprovide superior customer valueand satisfaction.



Actors in the Microenvironment



• Suppliers:

– Provide resources needed

to produce goods andservices.

– Important link in the “value

delivery system.”

– Most marketers treatsuppliers like partners.





• Marketing Intermediaries:

– Help the company to promote, sell, and distribute its

goods to final buyers

• Resellers

•Physical distribution firms

• Marketing services agencies

• Financial intermediaries



Partnering With Intermediaries

Coca-Cola provides

Wendy’s with much morethan just soft drinks. It

also pledges powerful

marketing support.



• Customers: – Five types of markets that

purchase a company’sgoods and services

– Consumer markets

– Business markets

– Reseller markets

– Government markets

– International markets





• Competitors:

– Those who serve a target market with products

and services that are viewed by consumers as

being reasonable substitutes

– Company must gain strategic advantage against

these organizations

• Publics: – Group that has an interest in or impact on an

organization's ability to achieve its objectives



Types of Publics



The 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.



The Company’s Macroenvironment



The Company’s Macroenvironment

• Demographic:

– The study of human populations in terms of size,

density, location, age, gender, race, occupation, and

other statistics.

– Marketers track changing age and family structures,

geographic population shifts, educational

characteristics, and population diversity.



The Seven U.S. Generations



Baby Boomers

• 78 million born between 1946 and 1964

• Account for 28% of population

• Earn more than half of all personal income

• Almost 25% belong to racial or ethnic minority

• Spend a lot on anti-aging products and services

• Are likely to postpone retirement



Generation X

• 45 million born between 1965 and 1976• Defined by their shared experiences

– Increasing divorce rates

– More of their mothers employed

• Cynical of frivolous marketing pitches

• Care about the environment

• Prize experience, not acquisition



Generation Y

• 72 million born between 1977 and 1994

• Have large amount of disposable income

• Comfortable with computer technology• Tend to be impatient and “Now-Oriented”

• Many product lines targeted at Gen Ys



• Pair with another student to discuss the

following questions:

– In what ways does the buying behavior of youand your parents differ?

– In what ways does the buying behavior of you

and your grandparents differ?

– What selling strategies would work best for:

• You

• Your parents

• Your grandparents

Interactive Student

Assignment



Changing Pakistani Family



The Changing American Family

Non-family households—single

live-alones or adult live-

togethers of one or both

sexes—make up a full 32percent of U.S. households.

Today’s marketers must

incorporate “the likes of

Murphy Brown, Ally McBeal,and Will and Grace into their

business plans.”



Geographic Shifts in Population

• 16% of U.S. residents move each year

• General shift toward the Sunbelt states

• City to suburb migration continues

• More people moving to “micropolitan” areas

• More people telecommute



Better Educated Population

• 1970:

• 1980:

• 1990:

• 2012:



More White-Collar Population

• 1950 – 1985:

– Proportion of white-collar workers increased from

41% to 54%

– Proportion of blue-collar workers decreased from47% to 33%

– Proportion of service workers increased from 12%

to 14%

• 1983 – 1999:

– Proportion of managers and professionals

increased from 23% to >30%



Diversity-Based Advertising

Based on careful study of cultural differences, Bank of America has

developed targeted advertising messages for different cultural subgroups,

here Asians and Hispanics.



Economic Environment

• Changes in Income – 1980’s – consumption

frenzy

– 1990’s – “squeezed

consumer”

– 2000’s – value marketing

• Income Distribution – Upper class

– Middle class

– Working class

– Underclass

Consists of factors that affect consumerpurchasing power and spending patterns.



Income Distribution

Walt Disney markets two distinct Pooh bears to match its two-tiered

market.



Natural Environment

• Involves the natural

resources that are

needed as inputs bymarketers or that are

affected by marketing

activities.



Factors Impacting the Natural Environment

Shortages of Raw Materials

Increased Pollution

Increased Government Intervention

Environmentally Sustainable Strategies



Environmental Responsibility

McDonald’s has made a substantial commitment to the so-called

“green movement.”



Technological Environment

• Most dramatic

force now

shaping our

destiny.

h l i l i



Technological Environment

• Changes rapidly.

• Creates new markets andopportunities.

• Challenge is to makepractical, affordableproducts.

• Safety regulations result inhigher research costs andlonger time betweenconceptualization andintroduction of product.



• Within the last ten years, which technologicalforce has had the greatest impact on

marketing? In what areas of marketing hasthis impact been seen?

• What technological force has impacted youthe most? In what ways has this occurred?

Discussion Questions



Political Environment

Includes Laws,

Government

Agencies, and

Pressure Groups thatInfluence or Limit

Various Organizations

and Individuals In a

Given Society.

Increasing Legislation

Changing Government

Agency Enforcement

Increased Emphasis on Ethics

& Socially Responsible Actions



Cultural Environment

• The institutions and

other forces that

affect a society’sbasic values,

perceptions,

preference, and

behaviors.




• Core beliefs and values are passed on from

parents to children and are reinforced by

schools, churches, business, and government.

• Secondary beliefs and values are more open

to change.

C lt l E i t



Themselves

Others

Organizations

Society

Nature

The Universe


Society’s MajorCultural Views Are

Expressed in

People’s Views of:



Responding to the Marketing Environment

• Environmental Management Perspective

• Taking a proactive approach to managing the

environment by taking aggressive (rather than

reactive) actions to affect the publics and forces in

the marketing environment.• This can be done by:

– Hiring lobbyists

– Running “advertorials”

– Pressing lawsuits

– Filing complaints

– Forming agreements to control channels



Responding to the


“There are three kinds of companies: those who

make things happen, those who watch things

happen, and those who wonder what’s

happened.”

marketing principles 03

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