part one: this is marketing Chapter 2marketing environment
an opening challenge You work for an oil company and Greenpeace protesters are currently camped outside the refinery. They are protesting over a proposed new pipeline and no one at the oil company seems surprised that they are there. In fact, the counter-arguments were prepared in advance and the press release has gone to all the newspapers. Greenpeace kept its intentions a secret, so how was this possible?
agenda • market dynamics • stakeholders • analysing the marketing environment • situation analysis
market dynamics market followers market followers market followers market leader first mover advantage?
common problems for market pioneers categories of errors • marketing mistakes • product mistakes • stuck with first-generation technology • resource limitations Doyle (2002)
stakeholders influencers consumers distributors investors customers opinion leaders the organisation employees media suppliers pressure groups government local community
what’s going on in the marketing environment? gm foods global warming ageing populations online social networking changing tastes advertising campaigns war rise in obesity digital technologies transport problems fashion trends economic instability packaging laws new suppliers elections shareholder pressure terrorism immigration new competitors increases in taxes new EU regulations staff skills
analysing environmental factors Political Regulatory Economic Social Technological Competitive Organisational Market P R E S T C O M
the macro environment political regulatory (macro) economic social (society) technology
the political environment the activities of: • government (central, regional, local and supranational) – e.g. EU • special interest, lobbying and pressure groups – e.g. Countryside Alliance, Friends of the Earth, CND, Amnesty, Stonewall • trade unions – e.g. Unison, UCU, NUS • political parties
the regulatory environment • laws • criminal and civil • e.g. Consumer Protection Act (1987) • e.g. negligence (a tort) • codes of practice • e.g. Advertising Standards code • customary practice
the economic environment • key economic indicators such as: • employment levels • interest rates • taxes • budget deficit • balance of payments • inflation • trade cycle movements
trade cycle (business cycle)AQ – type needs re-setting and ‘cofidence’ amended to ‘confidence’ x2
the social environment • population increases/decreases • demographic trends • e.g. more older people • attitude changes • e.g. acceptance of gay couples • patterns of behaviour • e.g. more working mothers
advances in the technological environment • information technology (IT) • e.g. latest processors, storage devices, software • communications technology • e.g. smartphones, 4G • transport technologies • e.g. high-speed trains, electric cars • production technology • medical technology
the micro environment(competitive and internal) organisation competition market
the competitive environment • direct competitors • similar products in the same category • close competitors • alternative products in the same category • substitutes • a product that fulfils the same need or has the same core benefit • indirect competitors • any other product that may be bought instead
competitors What kind of competitors are the following? • IrnBru and Pepsi Cola • Coca Cola and Cadbury’s chocolate • a shirt and a pair of shoes • a Big Mac and a pizza • Coca Cola and Pepsi Cola
organisation (internal) environment strengths and weaknesses in terms of: • staff and skills • finance • product range, brands • locations, stores, distribution network • reputation, brand image • innovation
market environment (customers) • customers may be: • individuals (consumers) • organisations • look for: • changes in taste, fashion • changes in purchasing behaviour • changes in product usage
the international environment other countries home country PRESTCOM PRESTCOM + CCC
the three Cs • country • e.g. history and geography • e.g. relationships between nations • currency • e.g. stability • culture • and sub-cultures
situation analysis S W O T strengths weaknesses opportunities threats
AN OPPORTUNITY IS THE OPPOSITE OF A THREAT. IT IS NOT AN ACTION OR A STRATEGY.
internal external the analysis PRESTCOM SWOT
SWOT analysis • organise environmental factors under SWOT headings • match them • opportunities that play to strengths • threats that play to weaknesses • rank them • according to importance to the organisation
summary • the importance of environmental scanning • the identification of key strengths and weaknesses, opportunities and threats • understanding stakeholders and their interests • sound analysis is the basis for objective setting and marketing planning
reference Doyle, P. (2002) Marketing Management and Strategy (3rd edn). Harlow: FT Prentice Hall.