Chapter 04 MKT120 Mkt Environment

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  • These questions are the learning objectives guiding the chapter and will be explored in more detail in the following slides.
  • Ask students: How does Earth Rewards help the environment? Is it enough to make a difference to the environment? The consumer? A possible answer might refer to the increased use of credit cards and its impact on the economy. More specifically, are people overspending due to high credit amounts? Be sure to explore the area on calculating carbon impact. This is a very innovative program
  • In all marketing activities, the consumer is at the center. Anything that affects consumers affects marketers. Any change in one of these environments likely requires an adjustment to the firm’s marketing mix. By identifying potential environmental trends, firms often can take proactive steps.
  • The immediate environment includes the firm and its immediate influences, such as competition and corporate partners.
  • Ask students : What are Pepsi’s core competencies? What do they do well? Answer: They know how to bottle beverages, distribute them to stores, and promote their brand. Ask students: How they capitalized on their core competencies in the face of changing market trends? Answer: The trend toward more diet-conscious consumers has led to the development of low-calorie alternatives to sodas. Both Coke and Pepsi understood the market had changed and introduced bottled water products with great success. In 2004, Americans consumed 23 gallons of bottled water per person—ten times as much as in 1980.
  • Group activity : Ask students to brainstorm a list of possible CI sources. Have them discuss what they can learn from each source. Do they know of any illegal sources? Legal sources include public material, interviewing customers and analyzing marketing tactics? Illegal sources include breaking into the competitor’s headquarters, posing as a potential customer, and taking aerial photographs of a competitor’s plant.
  • There is an example in the text of Gillette filing for patent infringement against Schick very quickly after the Quattros release. This quick filing leads one to believe that Gillette knew about the launch through competitive intelligence.
  • Firms must work together to create a seamless system that delivers goods and services to customers when and where they want them. Many attribute a key reason for Wal-Mart’s success is their close relationships with their suppliers.
  • 1. The company’s capabilities, competitors, and competitive intelligence, and the company’s corporate partners.
  • This slide can be used to review this topic instead of the following slides, which provide more in-depth discussions.
  • Firms often remove brands from the market because of their poor overall sales, but this strategy can backfire when those brands have strong regional support. For example, the removal of a chowder cracker caused such upheaval among Northeastern consumers that the firm hired a tall ship to reintroduce the cracker to its New England market, where consumers had threatened to boycott all products from the company if the cracker was not returned.
  • Ask students: What are some typical demographics? Answer: age, gender, income, education. Demographic segmentation is probably the most common form of segmentation because the information is so widely available.
  • Group activity : Have students brainstorm a list of the defining characteristics of their generation. Ask students : How does your generation differ from previous generations, such as their parents — the Baby Boomers. What macroenvironmental forces have had the most impact on your generation?
  • Ask students: What does the phrase “generation gap” mean to you? How do you experience this gap between your generation and that of your parents or grandparents? In what ways do you believe your generation is similar to that of your parents or grandparents?
  • The “middle-class squeeze” is a very real global phenomenon. Many developing countries face similar income inequities to those found in the United States. Pay gaps also cause problems for many new college graduates who find they cannot afford to live on their own and must move back in with their parents.
  • Ask students: Do you plan to continue your education after graduation? Many students believe they will never return to school after they finish their Bachelors’ degree, but modern conditions make this choice more and more unlikely. Lifelong learning of new skills and new knowledge has become key to survival in the global economy
  • Women now make up more than 60% of the college population. Ask students? How do you believe this will affect the workplace in the future? Ask students? Do you believe that there are still significant gender differences? What are they?
  • Ask students: What steps can and should marketers take to respond to the changing ethnic mix of the United States? Many marketers already have adjusted their marketing mix to meet the needs of ethnically diverse segments better. This YouTube video is for a Carlos Mencia Bud Light superbowl ad about teaching English. (always check YouTube links before class).
  • This graphic introduces four significant social trends.
  • Green consumers purchase products based on issues beyond the tangible product. These issues can include a variety of social causes such as environmental awareness, protection of animals, HIV/AIDS awareness and prevention, etc. Consumers who purchase these products do so to support these causes.
  • This ad is clearly targeted to kids and tweens. This might be an interesting time to discuss the challenges in marketing to children, especially for products such as candy. Ask students: Should candy advertising to children be regulated? Why? How much?
  • In recent years, firms have had to inform consumers of the steps they take to protect their privacy. The government also has instituted new rules for privacy protection. Ask students: Have you ever had a privacy problem with a credit card or when using the Internet?
  • With more time spent at work, the amount of time available for home or leisure activities has shrunk. In turn, services that complete the tasks that people no longer have the time to do, such as housecleaning, errands, and cooking, have grown. Ask students : What other entrepreneurial marketing opportunities have a time-poor society provided? They will mention many food products, Blackberry’s, TiVo.
  • Arguably the single most important change in the way we live is the introduction of new technology . Ask students: What new technologies have you seen at retailers? This web link is for the shoppers tool page of Stop and Shop a large east coast grocery retailer. They offer self-scanners, computer kiosk deli ordering and self checkout.
  • Depending on the time of year, discuss projections about Christmas shopping, vacation planning, or home buying. Various economic factors affect each of these areas. The web link leads to the Consumer Confidence Index which takes into account how consumers feel about how the economy is doing. This economic indicator relates directly to spending.
  • This list includes the major legislation designed to ensure a competitive marketplace and clearly demonstrates the U.S. government’s long history of enacting laws that protect fair trade.
  • Culture, demographics, social issues, technological advances, economic situation, and political/regulatory environment. Country Culture is the entire country but regional culture is based on the region or area within the country. Tweens, Gen Y, Gen X, Baby Boomers, Seniors Age Greener consumers, marketing to children, privacy concerns, and time-poor societies.
  • Explain to students that companies are involved in a host of activities. Ask students: Why might some social commentators suggest that CSR is unnecessary? Students will realize that some say the main objective of a company should be to make money. But an understanding of CSR moves many beyond a shareholder perspective to recognize that they must appeal to a vast variety of stakeholders including countries, suppliers, the environment, employees and customers.
  • Students should mention the environment, privacy, health, children’s rights
  • Social responsibility is one of the eight key measures that Fortune magazine uses to create its list of the most admired companies.
  • Today, companies are undertaking a wide range of corporate social responsibility initiatives, such as establishing corporate charitable foundations, supporting and associating with existing nonprofit groups, supporting minority activities, and following responsible marketing, sales, and production practices. Social responsibility is even one of the eight key measures that Fortune magazine uses to create its list of the most admired companies Inputs and outputs are both consumer, company, and cause.

Transcript

  • 1. © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin
  • 2. Learning Objectives LEARNING OBJECTIVES How do customers, the company, competitors, and corporate partners affect marketing strategy? Why do marketers have to think about their macroenvironment when they make decisions? How do corporate social responsibility programs help various stakeholders? © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-2
  • 3. Analyzing the Marketing Environment Earth Rewards credit card expects $20 billion in green sales by 2010 MyEarthRewards.com Website © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-3
  • 4. A Marketing Environment Analysis Framework© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-4
  • 5. The Immediate Environment© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-5
  • 6. Successfully Leveraging Company Capabilities Core competency Core competency Existing knowledge, Existing knowledge, facilities, patents, etc. facilities, patents, etc. applied to New markets, new New markets, new products, etc. products, etc. © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-6
  • 7. Competitors and Competitive Intelligence  Competitive Intelligence (CI)  Proactive rather than reactive strategy© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-7
  • 8. Gillette vs. Schick© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-8
  • 9. Corporate Partners• Firms are part of alliances• Align with competitors, suppliers, etc.• Just in Time Delivery Systems (JIT) From factory to Retailer © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-9
  • 10. Check Yourself 1. What are the components of the immediate environment?© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-10
  • 11. Macroenvironmental Factors© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-11
  • 12. Culture Country Culture vs. Regional Culture© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-12
  • 13. DemographicsProvides an easily understood snapshot of the typical consumer in aaspecific target market Provides an easily understood snapshot of the typical consumer in specific target market U.S. Census Website © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-13
  • 14. Generational Cohorts© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-14
  • 15. Seniors, Boomers and X and Y’ers© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-15
  • 16. Income Purchasing power is tied to income Census bureau tracks income Many middle class families feel the decline in purchasing $1,995.95 from power in recent years Hammacher Schlemmer © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-16
  • 17. Education = Education is related to income, Education is related to income, which determines spending power which determines spending power© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-17
  • 18. Gender© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-18
  • 19. Ethnicity Bud Light Commercial© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-19
  • 20. Social Trends© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-20
  • 21. Greener Consumers Customers who appreciate firms efforts to supply them with environmentally friendly merchandise.© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-21
  • 22. Targeting Kids: Is it wrong?© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-22
  • 23. Privacy Concerns© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-23
  • 24. Time Poor Society In the majority of families, most parents work Consumers have many more choices regarding leisure time Many consumers multitask © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-24
  • 25. Technological Advances  Technology has impacted every aspect of marketing − New products − New forms of communication − New retail channels Stop and Shop Website© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-25
  • 26. Economic Situation Foreign currency Foreign currency fluctuations fluctuations Combined with inflation and Combined with inflation and interest rates affect firms’ interest rates affect firms’ ability to market goods and ability to market goods and services services Conference Board Website© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-26
  • 27. Political/Regulatory Environment:Competitive Practice and Trade Legislation © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-27
  • 28. Check Yourself 1. What are the six key macroeconomic factors? 2. Differentiate between country culture and regional culture. 3. Identify the different generational cohorts. 4. What key dimension is used to classify an individual into a given cohort? 5. What are some important social trends shaping consumer values these days?© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-28
  • 29. Corporate Social Responsibility© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-29
  • 30. What are customer’s concerns?© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-30
  • 31. The Output for Companies© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-31
  • 32. Check Yourself 1. How has corporate social responsibility evolved since the turn of the 20thCentury? 2. Identify the inputs and outputs of the corporate social responsibility framework?© McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-32
  • 33. GlossaryFirms use competitive intelligence (CI) to collect and synthesize information about their position with respect to their rivals. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-33
  • 34. GlossaryCountry culture involves visual nuances of a country’s culture such as artifacts, behavior, dress, symbols, physical settings, ceremonies, language differences, colors and tastes, and food preferences, as well as language. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-34
  • 35. GlossaryCulture is the shared meanings, beliefs, morals, values, and customs of a group of people. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-35
  • 36. GlossaryDemographics indicate the characteristics of human populations and segments, especially those used to identify consumer markets. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-36
  • 37. GlossaryA generational cohort is a group of people of the same generation. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-37
  • 38. GlossaryThe political/regulatory environment comprises political parties, government organizations, and legislation and laws. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-38
  • 39. GlossaryRegional culture involves the region in which people live in a particular country. Return to slide © McGraw-Hill Companies, Inc., McGraw-Hill/Irwin 4-39