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The Marketing Environment

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  1. The Marketing Environment Chapter 4

  2. Environmental Scanning • What is environmental scanning? • “The process of continually acquiring information on events occurring outside the organization.” • Why is it important?

  3. Environmental Forces • Social • Economic • Technological • Regulatory • Competitive

  4. Social Forces • Culture • Values • Attitudes • Demographics • Who is in the population and what is important to them?

  5. Culture & Values • What Values are Important to Americans? • Changing Role of Women • Working Longer Hours Source: http://www.techistan.com

  6. The Mature Household • Born before 1945 • 23% of the population • 75% of country’s wealth • Healthcare is important issue • Cautious consumers

  7. Baby Boomers • Born between 1946-1964 • Largest group in population • 75 million • Want to age gracefully • Rise in cosmetic/health products • More brand loyal than younger groups Source: http://www.richprice.com

  8. Generation X • Born between 1965-1980 • 17 million in U.S. • One parent households • “A lost generation” • “Cut teeth” on technology • Value religion, rituals, materialism • “Global teens”: Similar experiences across national boundaries Source: http://banana1015.com

  9. Generation Y • Born after 1976 • 28% of the population • Grew up with technology • Sons and daughters of Baby Boomers • Politically active • Less racially sensitive Source: http://teachers.net

  10. Tweens • Be“tween” being a child and a teenager • Ages 8-12 • $200 billion annually • Brand conscious • But not necessarily brand loyal

  11. Hispanics Buying Patterns • Purchasing power: $1.4 trillion • Unity through language • Brand loyal • Influenced by families and peers • Also influenced by advertising • Highly conservative • Common religion • Opinion leaders • Difficulties • Differing backgrounds • Language barrier

  12. African-Americans Buying Patterns • 12% of population • Purchasing power: $1.2 trillion • Lower annual income than whites • “Younger” subculture • Technological focus • Increasing media presence • Price conscious • Unique buying patterns Source: http://www.thevalueengineers.com

  13. Asian Buying Patterns • Highly educated • Strong family ties • Hard working • Hesitant to use credit

  14. Economic Forces • “Deals with the income, expenditures, and resources that affect the cost of running a business or household” • Macroeconomic • Microeconomic

  15. Macroeconomic Forces • Deals with entire market- aggregate of all “players” within it. • If consumers feel they will be better off, they will buy more. • If consumers feel they will be worse off, they will opt to save money or be hesitant to spend it. Source: http://www.bookbyte.com

  16. Microeconomic Forces • Gross income • Total amount of money earned annually by an individual • Disposable Income • Money remaining after paying taxes • Discretionary Income • Money remaining after paying taxes and for necessities Source: http://www.principlesofmicroeconomics.net

  17. Technological Forces • Becoming increasingly important • As technology becomes more commonplace, prices fall. • Designs new products or improves existing ones • Improves systems and flow of information • Internet • Intranet • Extranet

  18. Competitive Forces • “Alternative firms that could provide a product to satisfy a specific market’s need” • Perfect competition • Monopoly • Oligopoly • Monopolistic competition

  19. Competitive Forces • Porter’s Model • Barriers to Entry • Buyer Power • Supplier Power • Degree of Rivalry • Substitutes Source: http://notesdesk.com/notes/strategy/porters-five-forces-model-porters-model/

  20. Regulatory Forces • “Restrictions state and federal laws place on business with regard to the conduct of its activities.” • Protect customers & companies • Regulatory agencies • Consumer Product Safety Commission • Food & Drug Administration • Federal Trade Commission

  21. Regulatory Forces • Place-Related Legislation • Exclusive dealing • Requirement contracts • Exclusive territorial distributorships • Tying arrangement • Promotion-Related Legislation • Federal Trade Commission