Analyzing the Marketing

Environment
Chapter 3
First Stop: YouTube: Adapting to the Fast-
Changing Marketing Environment
Begins in 2005
For sharing low-quality homemade video clips
Adapts to the market
Provides access to films and TV episodes
Introduces a mobile app
Develops an advertising model for the site

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The actors and forces outside
marketing that affect marketing
managements ability to build
and maintain successful
relationships with target
customers
Marketing
environment
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Marketing Environment
Studying the marketing environment allows
marketers to take advantage of opportunities
and combat threats

Marketing intelligence and research are used
to collect information about the environment
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The actors close to the company that
affect its ability to serve its customers
the company, suppliers, marketing
intermediaries, customer markets,
competitors, and publics
Microenvironment
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Figure 3.1 - Actors in the
Microenvironment
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The Microenvironment The Company
Other company departments must be
considered when designing marketing plans

Marketing decisions are made within the
broader strategies made by top management

All departments share responsibility for
understanding customer needs and creating
value
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The Microenvironment - Suppliers
Provide resources needed to produce goods
and services

Efficiency / delays
Cost / suppliers power
Volumes availability

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The Microenvironment Marketing
Intermediaries
Firms that help the company promote, sell,
and distribute its goods to final buyers (facilitate)
Resellers
Physical
distribution
firms
Marketing
services
agencies
Financial
intermediaries
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The Microenvironment - Competitors
A company must provide greater customer
value and satisfaction than its competitors do

The company must position its offerings
strongly against competitors offerings in the
minds of consumers
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The Microenvironment - Publics
Any group that has
an actual or
potential interest in
or impact on an
organizations ability
to achieve its
objectives
Financial
publics (Funds)
Media publics
(opinion
building)
Government
publics
(Govt interests)
Citizen-action
publics
(Civil Society)
Local publics
(Local residents
& community)
General public
(Image of the
company)
Internal publics
(Employees)
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The Microenvironment - Customers
3-14
Buy for personal consumption
Consumer
markets
Buy for use in production processes
Business
markets
Buy to resell at a profit
Reseller
markets
Buy for public purposes
Government
markets
Buyers in other countries
International
markets
Consists of the broader forces
that affect the actors in the
microenvironment
Macroenvironment
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Figure 3.2 - Actors in the
Macroenvironment
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The Demographic Environment
Demography: The study of human
populations in terms of size, density, location,
age, gender, race, occupation, and other
statistics
Increasing population & urbanization
Social class (Income trends)
Growth in rural population
Changing family systems - Joint families to DISC Families
Changing role of women - working class
A better educated, more white collared, more
professional population
Increasing diversity

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The Demographic Environment
3-18
40 % of Pakistan
population consisted of
14 year or younger

Out of which 14% are 4
years or young

Considering the huge
potential P & G
launched Pampers in
Pakistan

Turning out to be a
huge success




The Demographic Environment
3-19
Hero Honda India offered
bike with a tag just 4 her

Targeting working and
college going females

Many products are being
offer purely for women




The Economic Environment
Economic factors that affect consumer
purchasing power and spending patterns

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Industrial
economies
Rich markets
for many
different kinds
of goods
Subsistence
economies
Consume most
of their own
agricultural and
industrial
output
Offer few
market
opportunities
Developing
economies
Offer
outstanding
marketing
opportunities
for the right
kinds of
products
The Natural Environment
Involves natural resources that are needed as
inputs by marketers or that are affected by
marketing activities
Key trends include:
Shortages of raw materials
Increased pollution
Increased government intervention
Firms focus on creating environmentally
sustainable strategies
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The Technological Environment
Companies that do not keep up with
technological changes will soon find their
products outdated

Marketers should be aware of government
regulations when applying new technologies
and developing new products
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The Political and Social Environment
Includes laws, government agencies, and
pressure groups that influence or limit
various organizations and individuals in a
given society
Business legislation is enacted:
To protect companies from each other
To protect consumers from unfair business
practices
To protect the interests of society against
unrestrained business behavior
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Institutions and other forces that affect
societys basic values, perceptions,
preferences, and behaviors
Cultural environment
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The Cultural Environment
Core beliefs and values
Passed on from parents to children
Reinforced by schools, churches, business, and
government
Secondary beliefs and values
More open to change than core beliefs

Believing in marriage is a core belief and getting
married at early age is secondary belief

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The Cultural Environment
Societys major cultural views are expressed
in peoples views of:
Themselves (do it yourselfers, adventurers: Dew)
Others (less socialization trend: sell tv, dvds)
Organizations (for employees its a source of
money)
Society (patriotic: use independence day to sell
items)
Nature (Nestle eco friendly bottles)
The universe (spirituality, religion)

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The Cultural Environment
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The Cultural Environment
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The Cultural Environment
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Responding to the
Marketing Environment

Reactive firms Passive, simply react to
changes in the marketing environment

Proactive firms - Manage the marketing
environment via aggressive actions designed
to affect the publics and forces in the
marketing environment

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