MKT 340 Chapter 3

Marketing environment
refers to the actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers
microenvironment
consists of the actors close to the company that affect its
ability to serve its customers
macroenvironment
consists of the larger societal forces that affect the
micro-environment.
six major forces in the company’s macroenvironment
-the company
-suppliers
-marketing intermediaries
-competitors
-publics
-customers
The Company
All interrelated groups in the company such as top
management, finance, research and development
(R&D), purchasing, operations, human resources, and
accounting form the internal environment
Suppliers
-Suppliers form an important link in the company’s
overall customer value delivery network.
• Provide the resources needed by the company to
produce its goods and services
Marketing Intermediaries
help the company to promote, sell, and distribute its products to final buyers
Resellers
are distribution channel firms that help the company find customers or make sales to them. These include wholesalers and retailers
Physical distribution firms
help the company to stock and move goods from their points of origin to their destinations
Marketing services agencies
are the marketing research firms, advertising
agencies, media firms, and marketing consulting firms that help the company target and promote its products to the right markets
Financial intermediaries
include banks, credit companies, insurance
companies, and other businesses that help finance transactions or insure against the risks associated with the buying and selling of goods
Competitors
a company must provide greater customer value and satisfaction than its competitors do. Thus, marketers
must do more than simply adapt to the needs of target consumers. They also must gain strategic advantage by positioning their offerings strongly against competitors’ offerings in the minds of consumers.
Publics
any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives
Financial publics
influence the company’s ability to obtain funds
Media publics
carry news, features, and editorial opinions
Government publics
Management must take government developments into account
Citizen-action publics
A company’s marketing decisions may be questioned by consumer organizations, environmental groups, etc.
Local publics
include neighborhood residents and community organizations
General public
The general public’s image of the company affects its buying
Internal publics
include workers, managers, volunteers, and the board of directors
Five types of customer markets
-consumer markets
-business markets
-reseller markets
-government markets
-international markets
Consumer markets
individuals and households that buy goods and
services for personal consumption
Business markets
buy goods and services for further processing or for use in their production process
Reseller markets
buy goods and services to resell at a profit
Government markets
consist of government agencies that buy goods and services to produce public services
International markets
consist of buyers in other countries, including consumers, producers, resellers, and governments.
six major forces in the company’s macroenvironment.
-demographic
-economic
-natural
-technological
-political
-cultural
Demographic Environment
Demography is the study of human populations in terms of
size, density, location, age, gender, race, occupation, and
other statistics.
• Changes in the world demographic environment have major implications for business. So marketers keep close track of demographic trends and developments in their markets, both at home and abroad.
Marketers analyze several important factors that affect the
marketing environment
Changing Age Structure of the Population
– Changing American Family
– Geographic population shifts
– Educational characteristics
– Population diversity
Baby Boomers
78 million people born during the years following World War II and lasting until 1964
Generation X
49 million people born between 1965 and 1976 in the “birth dearth” following the baby boom
Millennials (or Generation Y)
83 million children of the baby boomers born between 1977 and 2000
Generation Z
People born after 2000 (although many analysts include people born after 1995) who make up the kids, tweens, and teens markets
economic environment
economic factors that affect consumer
purchasing power and spending patterns.
value marketing
-has become the watchword for many marketers.
-Marketers in all industries are looking for ways to offer today’s frugal buyers greater value.
income distribution
Over the past several decades, the rich have grown richer, the middle class has shrunk, and the poor have remained poor
natural environment
involves the physical environment and the natural resources that are needed as inputs by marketers or that are affected by marketing activities. Marketers should be aware of several trends in the natural environment.
environmental sustainability
refers to the effort to create a world economy that the planet can support indefinitely
Technological Environment
New technologies can offer exciting opportunities for marketers. Many firms use radio-frequency identification, or RFID, technology to track products through various points in the distribution channel. New technologies create new markets and opportunities. Companies that do not keep up will soon find their products outdated.
Political Environment
refers to laws, government agencies,
and pressure groupsthat influence or limit various organizations and individuals in a given society
Legislation Regulating Business is enacted for three main reasons
-To protect companies from each other
-To protect consumers from unfair business practices
-To protect the interests of society against unrestrained business behavior
Socially Responsible Behavior
Socially responsible firms actively seek out ways to protect the long-run interests of their consumers and the environment.
Cause-Related Marketing
To exercise their social responsibility and build more positive images, many companies are now linking themselves to worthwhile causes. Cause-related marketing has become a primary form of corporate giving
cultural environment
consists of institutions and other forces that affect a
society’s basic values, perceptions, preferences, and behaviors
Core beliefs and values
-They are passed on from parents to children and are reinforced by schools, churches, businesses, and government.
– For example, most Americans believe in individual freedom, hard work, getting married, achievement, and success
Secondary beliefs and values
are more open to change and include people’s views of themselves, others, organizations, society, nature, and the universe. Believing in marriage is a core belief; believing that people should get married early in life is a secondary belief
Cultural characteristics that can affect marketing decision making
-People’s views of themselves: People vary in their emphasis on serving themselves versus serving others.
-People’s views of others: More “cocooning” – staying home, eating home-cooked meals
-People’s views of organizations: Decline of loyalty toward -companies
-People’s views of society: Patriots defend it, reformers want to change it, and malcontents want to leave it.
-People’s views of nature: Some feel ruled by it, in harmony with it, or seek to master it.
-People’s views of the universe: Renewed interest in spirituality and development of more permanent values family, community, earth, faith
Responding to the Marketing Environment
1. Many companies view the marketing environment as an uncontrollable element to which they must react and adapt. They passively accept the marketing environment and do not try to change it.
2.Other companies take a proactive stance toward the marketing environment. Rather than assuming that strategic options are bounded by the current environment, these firms develop strategies to change the environment. These firms take aggressive actions to affect the publics and forces in their marketing environment