Environmental Forces Marketing Class Notespptx

Environmental Forces Marketing Class Notes Important Topics

1. Environmental Forces A company’s marketing environment consists of the factors and the forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers. Microenvironment Macro environment

2. Microenvironment

3. Microenvironment The Company Top Management R&D Finance Purchasing Production Operations Accounting

4. Microenvironment Suppliers Treat them as business partners. As s upply shortages or delays, labor strikes, and other events can cost sales in the short run and damage customer satisfaction in the long run. Rising supply costs may force price increases that can harm the company’s sales volume. Toyota: There is a phrase ‘’achieve suppliers satisfaction’’ in Toyota mission statement.

5. Microenvironment Marketing Intermediaries Marketing intermediaries help the company promote, sell, and distribute its products to final buyers. Resellers. Physical Distribution firms. Marketing services agencies. Financial intermediaries.

6. Microenvironment Competitors The marketing concept states that, to be successful, a company must provide greater customer value and satisfaction than its competitors do.

7. Microenvironment Publics A public is any group that has an actual or potential interest in or impact on an organization’s ability to achieve its objectives. 7 types of Publics: • Financial publics. This group influences the company’s ability to obtain funds. Banks, investment analysts, and stockholders are the major financial publics.

8. Microenvironment Publics Media publics: This group carries news, features, and editorial opinion. It includes newspapers, magazines, television stations, and blogs and other Internet media. Government publics: Management must take government developments into account. Marketers must often consult the company’s lawyers on issues of product safety, truth in advertising, and other matters.

9. Microenvironment Publics Citizen-action publics: A company’s marketing decisions may be questioned by consumer organizations, environmental groups, minority groups, and others. Its public relations department can help it stay in touch with consumer and citizen groups.

10. Microenvironment Publics • Local publics: This group includes neighborhood residents and community organizations. Large companies usually create departments and programs that deal with local community issues. For example: Loads of Hope program recognizes the importance of community publics. It provides mobile laundromat and loads of clean laundry to families in disaster-stricken areas. P&G washes, dries, and folds clothes for these families for free because “we’ve learned [that] sometimes even the littlest things can make a difference.”

11. Microenvironment Publics • General public: A company needs to be concerned about the general public’s attitude toward its products and activities. The public’s image of the company affects its buying. Internal publics: This group includes workers, managers, volunteers, and the board of directors. Large companies use newsletters and other means to inform and motivate their internal publics.

12. Microenvironment Customers Consumer Markets Business Markets Reseller Markets Government Markets International Markets

13. Macro environment The company and all of the other actors operate in a larger macro-environment of forces that shape opportunities and pose threats to the company.

14. Macro environment

15. Macro environment Demographic Environment Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics. The demographic environment is of major interest to marketers because it involves people, and people make up markets. The world population is growing at an explosive rate. It now exceeds 6.8 billion people and is expected to grow to more than 8 billion by the year 2030 . The world’s large and highly diverse population poses both opportunities and challenges.

16. Macro environment Demographic environment Changing family sizes. Changing age structures. Changing American Families In USA married couples with children are only 22% of 117 million households. Without children are 29%. Single parents are 11%. 38% are non-family. Number of working women rise from below 40% to 59%.

17. Macro environment Demographic environment Among married couples, 59% are both husband & wife are working. Stay at home dads increased by 18% since 1994. About 158000 Dads stay at home.

18. Macro environment Geographic shifts in population Population shift to metros. Population shifts to suburbs. Business shifts/ expansions to suburbs. Education Number of educated people has increased from past. Educated people increase the demand of quality products, books, computers etc.

19. Macro environment Increasing diversity At Japan everyone is J apanese, where as in America is known as ‘’Melting Pot’’. Where diverse groups from many nations and cultures have been melted into a single. Volkswagen Routan add. 60 million US adults with disabilities.

20. Macro environment Economic Environment The economic environment consists of economic factors that affect consumer purchasing power and spending patterns.

21. Macro environment Economic Environment T

22. Macro environment Economic Environment Changes in Consumer Spending Economic recession moved people back to basics. Income Distribution 5% of American earners get 21% of gross income 20% of earners capture 49% of all income. Bottom 40% get just 13% of all income.

23. Macro environment Natural environment The natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities . Air & Water Pollution Growing shortages of raw material By 2030 more than one in three of world’s population will not have enough water to drink.

24. Macro environment Technological Environment The technological environment is perhaps the most dramatic force now shaping our destiny . Technology has released such wonders as robotic surgery, miniaturized electronics, smartphones, and the Internet. It also has released such horrors as nuclear missiles , chemical weapons, and assault rifles. It has released such mixed blessings as the automobile , television, and credit cards.

25. Macro environment Technological Environment New technologies create new markets and opportunities. However , every new technology replaces an older technology.

26. Macro environment Political & Social Environment Marketing decisions are strongly affected by developments in the political environment. The political environment consists of laws, government agencies, and pressure groups that influence or limit various organizations and individuals in a given society. Increasing legislation Fair trade practices Product Safety Truth in advertising

27. Macro environment Political & Social Environment Increasing legislation Fair trade practices Product Safety Truth in advertising Consumer privacy Commercial Transactions Labeling Fair Advertisement

28. Macro environment Political & Social environment Socially responsible behavior. Cause related marketing

29. Macro environment Cultural environment The cultural environment consists of institutions and other forces that affect a society’s basic values, perceptions, preferences, and behaviors. People grow up in a particular society that shapes their basic beliefs and values . The Persistence of Cultural Values: Core beliefs Secondary beliefs

30. Macro environment Cultural environment Shifts in Secondary Cultural Values: People views of themselves. People vary in their emphasis on serving themselves versus serving others. Some people seek personal pleasure, wanting fun, change, and escape. Others seek self-realization through religion . or other life goals. Some people see themselves as sharers others see themselves as individualists. People use products, brands, and services as a means of self-expression, and they buy products and services that match their views of themselves. People views of others. In past decades observers have noted several shifts in people’s attitudes toward others. Now people intent on the simple pleasures of hearth and home. The instability of the economy creates uncertainty for consumers, and this uncertainty tends to make them focus more on being home and finding ways to save money. It’s a return to more traditional values, like home-cooked meals. It also gives boost to home appliances.

31. Macro environment People views of Organizations . Work loyalty shifts. Organizations needs to find new ways to win employee confidence. People views of Society . People vary in their attitudes toward their society—patriots defend it, reformers want to change it, and malcontents want to leave it.

32. Macro environment People views of Nature There was a concept that nature is bountiful but now people have recognized that natural things are finite and could even be destroyed by human activities. This renewed love of things natural has created a 63-million-person “lifestyles of health and sustainability” (LOHAS) market, consumers who seek out everything from natural, organic, and nutritional products to fuel-efficient cars and alternative medicine. This segment spends nearly $300 billion annually on such products. In the green building market alone, consumers spent $100 billion in 2008 on items such as certified homes, solar systems, and Energy Star appliances.50

33. Macro environment People views of universe . People vary in their beliefs about the origin of the universe and religious values. According to a recent poll, 16 percent of Americans now say they are not affiliated with any particular faith, almost double the percentage of 18 years earlier. Among Americans ages 18-29, 25 percent say they are not currently affiliated with any particular religion. Impact of covid