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Marketing Environment
and Evaluation of Marketopportunities
The Marketing Environment
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Marketing Environment- consists of the actors and forcesoutside marketing that affect marketing managementsability to develop and maintain successful relationshipswith its target customers.
Companies have to constantly reinvent their brands tokeep up with changing marketing environment.
Example Mattel Toys - Barbie Doll Jewish, Irish
Samsung Theft Proof Model
Includes:
Microenvironment - forces close to the company thataffect its ability to serve its customers.
Macroenvironment - larger societal forces that affectthe microenvironment.
Marketing Environment
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Identifying & responding to MacroenvironmentForces
These forces represent noncontrollables to which the
company must monitor and respond
Advancement of international transportation, communication& financial transactions, leading to rapid growth of worldtrade and investment.
Movement of manufacturing capacity and skills to lower costcountries.
Rising economic power of several Asian countries in worldmarkets.
Opening up of new markets, namely China and India.
Marketing Environment
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The Companys Macroenvironment
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The Companys MacroenvironmentDemographic
studies populations in terms of size, density,location, age, gender, race, occupation andother statistics.
Economic factors that affect consumer purchasing power
and spending patterns.Natural -
natural resources needed as inputs bymarketers or that are affected by marketing
activities.
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The Companys MacroenvironmentTechnological
Most dramatic force now shaping our destiny.
Political laws, government agencies, and pressuregroups that influence and limit organizationsand individuals in a given society.
Cultural institutions and other forces that affect asocietys basic values, perceptions, preferences,and behaviors.
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The Companys Macroenvironment
Demographic is the study of humanpopulations in terms of size, density, location,
age, gender, race, occupation, and otherstatisticsDemographic environment is important becauseit involves people, and people make up markets
Demographic trends include age, familystructure, geographic population shifts,educational characteristics, and populationdiversity
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Demographic Environment
A growing middle class
divided the Indian population into 5economic classes
Division based on real annual disposableincome
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Deprived households have an annual
disposable income of less than Rs90,000
The poorest economic class
Mostly unskilled or semi-skilledworkers on daily wages
Demographic Environment
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Aspirers have an annual disposableincome in the range of Rs 90,000 to
Rs 3,00,000
Spend most of their income on basicnecessities
Small-time retailers, small farmers,etc.
Demographic Environment
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Seekers have an annual disposableincome between Rs 3,00,000 and
Rs 6,00,000. Mostly white-collaremployees, mid-level governmentofficials, newly employed
postgraduates, medium-scale traders
Demographic Environment
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Strivers have an annual income
ranging from Rs 6,00,000 to Rs12,00,000
Have a stable income source andaccess to amenities
Mostly professionals such aslawyers, CAs, senior governmentofficials, rich farmers
Demographic Environment
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Global Indians have an annual
disposable income in excess of Rs12,00,000
Creamy layer in society
Globe-trotters with a high standardof living
Demographic Environment
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Demographic Environment
Growth in the rural population
A changing family systemThe changing role of women
Increasing diversity
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Ch
anging Age Structure
(78 million people born 1946-1964)One of the most powerful forces shaping themarketing environment, 28% of population
(45 million people born 1965-1976)More skeptical, savvy shoppers, respond to
honesty in advertising, share cultural concerns
(72 million people born 1977-1994)Fluent and comfortable with technology,
smart, aware, fair-minded (N-Gens)
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Changing Family Structure
58% of urbanwomen are workingor looking for a job.
Many marketers oftires, cars, insurance,
travel and financialservices target thesewomen.
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Economic Environment
Changes in Income1980s consumption
frenzy1990s squeezedconsumer
2000s value marketing
Income DistributionUpper class
Middle class
Working class
Underclass
Changing ConsumerSpending Patterns
Consumers atdifferent incomelevels have differentspending patterns
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Natural EnvironmentShortage of raw materials, Increased energy costs, Anti-pollution pressures, Changing Role of governments
The deterioration of the natural environment is majorglobal concern.Greenhouse gases
Depletion of ozone layer
Growing shortage of water etc
Environment related regulations will hit certain Industrieshard.Industries spewing hazardous fumes, disposing effluents in waterbodies.
Marketers need to be aware of the threats & opportunities
associated with four trends in the natural environment:
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Natural Environment 4 Trends
FactorsAffecting
the
NaturalEnvironment
Shortages ofRaw Materials
IncreasedPollution
Increased Government
Intervention
Cost of Energy
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Technological EnvironmentChanges rapidly
Creates new marketsand opportunitiesChallenge to makepractical, affordableproducts
Safety regulationsresult in higherresearch costs
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IncreasingLegislationIncreasingLegislation
ChangingGovernmentAgency
Enforcement
ChangingGovernmentAgency
Enforcement
Includes Laws, GovernmentAgencies, Etc. that Influence& Limit Organizations/Individuals in a Given Society
Increased
Emphasis onEthics &Socially
ResponsibleActions
Increased
Emphasis onEthics &Socially
ResponsibleActions
Political Environment
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Themselves Identify with
brands for self-
expressionOthers
Recent shift fromme 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 Environment Includes peoplesviews of
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Cultural EnvironmentViews of themselves
Views of others
Views of organizations
Views of society
Views of nature
Views of the universe
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ThemselvesThemselves
OthersOthers
OrganizationsOrganizations
SocietySociety
NatureNature
The UniverseThe Universe
Cultural Environment
Societys Major
Cultural Views AreExpressed in
Peoples View of:
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Companys Internal Environment
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Marketing mustconsider other parts ofthe organizationincluding finance, R&D,purchasing, operationsand accounting
Marketing decisions
must relate to broadercompany goals andstrategies
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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Marketers must watchsupply availability andpricing
Effective partnershiprelationshipmanagement withsuppliers is essential
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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Help to promote, sell anddistribute goods to finalbuyers
Include resellers, physicaldistribution firms,marketing servicesagencies and financialintermediaries
Effective partnerrelationship managementis essential
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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The five types ofcustomer markets
Consumer Business
Reseller
Government
International
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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Conducting competitoranalysis is critical forsuccess of the firm
A marketer mustmonitor its competitorsofferings to createstrategic advantage
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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A group that has an actualor potential interest in orimpact on an organization
Seven publics include: Financial
Media
Government
Citizen-action
Local
General
Internal
Microenvironment
ActorsActors
1. The company2. Suppliers
3. Marketingintermediaries
4. Customers
5. Competitors
6. Publics
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The Companys MicroenvironmentCompanys Internal Environment
areas inside a company; top management,
affect the marketing departments plans
Suppliers
provide resources needed to produce goods and
services
Marketing Intermediaries
help the company to promote, sell, and distribute
its goods to final buyers i.e. resellers
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R
esponding to th
eMarketing EnvironmentEnvironmental Management Perspective
Taking a proactive approach to managing the
microenvironment and themacroenvironment by taking proactive(rather than passive) actions to affect thepublics and forces in the marketingenvironment.
How? Hire lobbyists , run advertorials,press law suits, and form agreements.
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