3-1

MARKETING MANAGEMENT

Understanding Market Demand and the

Environment

3-2

Chapter Questions

• What is important to know?

• What data can be employed?

• How can demand be forecasted and

measured?

• What are some important macro-

environmental forces?

Background on Industry

• What are the trends in the industry?

– Sales amounts

– Growth rate

– Profit margins

– Industry trends

– Types of products

2-3

Background on Industry

BASED ON THAT INFORMATION

• THEN…

– Is this an area we should enter?

– Where are the opportunities?

– What should we be doing to stand out?

• (What is our competitive advantage?)

– Is that position profitable or sustainable?

2-4

3-5

Internal Data Sources

MarketingResearch

CommercialData Sources

MarketingIntelligence

Sales Information

3-6

Secondary Commercial Data Sources

A.C. Nielsen

NDP Group

Ipsos-Reid

Dun & Bradstreet’s

Simmons

SAMI/Burke

4-7

The Marketing Research Process

Define the problem

Develop research plan

Collect information

Analyze information

Present findings

Makedecision

Need estimates of prevalence?

Objective answers by

asking?

Yes

No

YesSURVEY

Good

Poor EXPLORATORY or SECONDARY RESEARCH

OBSERVATIONALRESEARCH

FOCUS GROUPSNo

Research FlowchartUnderstanding

of problem

4-9

Market Demand Functions

4-10

Market Demand Functions

4-11

Estimating Future Demand

• Survey of Buyers’ Intentions

• Composite of Sales Force Opinions

• Expert Opinion

• Past-Sales Analysis

• Market-Test Method

3-12

Environmental Forces

Demographic

Social-CulturalEconomic

NaturalTechnological

Political-Legal

3-13

Mattel Markets in China

3-14

Age versus Cohort effects

1. Age differences –

chronological

2. Cohort effects –

when you were born

3-15

Age versus Cohort effects

• http://www12.statcan.ca/english/census01/products/analytic/Multimedia.cfm?M=1

3-16

Use Data in Marketing Plan

What can these data sources tell you?

•Demand estimates

•Trends

MARKETING PLAN:

•What can we learn about demand for the product

or service?

•Explain it!

1-17

GROUP DISCUSSION: Toy business

1. What have been the key success factors for Toyland?

2. Where is Toyland vulnerable?

3. What should they watch out for?

4. What recommendation would you make to the owner going forward?

5. What should they be sure to do with their marketing?