Marketing Chapter 4-5

Target Market
Group of people for which an organization meets needs and results in an exchange
Environmental Management
Company implements strategies that attempt to shape the external environment
Social Factors
Attitudes, values, and lifestyles
Component Lifestyles
Practice of choosing goods and services that meet ones needs/interest rather than lifestyle
Demographic Factors
Age, race, and location
Economic Factors
Consumers Income, Purchasing Power, Inflation, and Recession
Purchasing Power
Compares income to relative cost of a standard set of goods/services in different geographic areas
Inflation
Decrease in value of money, expressed as percentage reduction in value
Recession
Period of economic activity characterized by negative growth; reduces demand for goods and services
Technological Factors
Basic Research – aims to confirm existing theory
Implied Research – attempt to develop new product
Competitive Factors
Number of competitors, relative size, and degree of interdependence within an industry
Gross Domestic Product
Total market value of all final goods and services produced for a given time period
Global Marketing Standardization
Production of uniform products that can be sold the same way all over the world
Multi-domestic Strategy
Subsidiaries of multinational firms are allowed to compete independently
Culture
Common set of values that determine what is socially acceptable
External Environment Factors
Culture, economic development, natural resources, political structure, and demographic makeup
Tariff
Tax on goods entering the country
Quota
Limit amount on product entering a country
Boycott
Exclusion of products from a country
Exchange Control
Foreign exchange must be sold to a control agency
Market Grouping
Common trade alliance
Trade Agreement
Agreement to stimulate international trade
Political/Legal Consideration
NAFTA and CAFTA-DR
Group Twenty (G20)
Forum for international economic development that promotes discussion between industrial and emerging market countries on key issues
Export
Sell products to buyers in other countries
Licensing/Franchising
Allowing use of knowledge/patents
Contract Manufacturing
Private label manufacturing by a foreign company/ manufacturing facility
Buyer for Export
Assumes all ownership risks and sells globally for own account
Export Broker
Plays traditional broker’s role by bringing buyer and seller together
Export Agent
Acts like manufacturer agent for exporter in foreign market
Exchange Rate
Reflects the price of one’s currency in terms of another’s currency
Floating Exchange Rates
Compromise a system in which prices of different currencies move up and down based on demand and supply of each currency
Dumping
Sale of exported product at a lower price than that charged for the same product in the “home” market