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The Marketing Environment. Chapter 4. Environmental Scanning. What is environmental scanning? “The process of continually acquiring information on events occurring outside the organization.” Why is it important?. Environmental Forces. Social Economic Technological Regulatory - PowerPoint PPT Presentation
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The Marketing The Marketing EnvironmentEnvironment
Chapter 4Chapter 4
Environmental ScanningEnvironmental Scanning
What is What is environmental environmental scanning?scanning? ““The process of The process of
continually acquiring continually acquiring information on events information on events occurring outside the occurring outside the organization.”organization.”
Why is it important? Why is it important?
Environmental ForcesEnvironmental Forces
SocialSocial EconomicEconomic TechnologicalTechnological Regulatory Regulatory CompetitiveCompetitive
Social ForcesSocial Forces
CultureCulture ValuesValues AttitudesAttitudes
DemographicsDemographics Who is in the population and what is Who is in the population and what is
important to them?important to them?
Culture & ValuesCulture & Values
What Values are What Values are Important to Important to Americans?Americans?
Changing Role of Changing Role of WomenWomen
Working Longer Working Longer HoursHours
Source: http://www.techistan.com
The Mature HouseholdThe Mature Household
Born before 1945Born before 1945 23% of the population23% of the population
75% of country’s wealth75% of country’s wealth Healthcare is important issue Healthcare is important issue Cautious consumersCautious consumers
Baby BoomersBaby Boomers Born between 1946-Born between 1946-
19641964
Largest group in Largest group in populationpopulation 75 million75 million
Want to age gracefullyWant to age gracefully Rise in cosmetic/health Rise in cosmetic/health
productsproducts
More brand loyal than More brand loyal than younger groupsyounger groups
Source: http://www.richprice.com
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
Generation YGeneration Y
Born after 1976Born after 1976 28% of the 28% of the
populationpopulation Grew up with Grew up with
technologytechnology Sons and daughters Sons and daughters
of Baby Boomersof Baby Boomers Politically activePolitically active
Less racially Less racially sensitivesensitive
Source: http://teachers.net
TweensTweens
Be“tween” being a Be“tween” being a child and a child and a teenagerteenager
Ages 8-12Ages 8-12 $200 billion $200 billion
annuallyannually Brand consciousBrand conscious
But not necessarily But not necessarily brand loyal brand loyal
Hispanics Buying PatternsHispanics Buying Patterns
Purchasing power: $1.4 trillionPurchasing power: $1.4 trillion Unity through languageUnity through language Brand loyalBrand loyal Influenced by families and Influenced by families and
peerspeers Also influenced by advertisingAlso influenced by advertising Highly conservativeHighly conservative Common religionCommon religion Opinion leadersOpinion leaders
DifficultiesDifficulties Differing backgroundsDiffering backgrounds Language barrierLanguage barrier
African-Americans Buying African-Americans Buying PatternsPatterns
12% of population12% of population Purchasing power: $1.2 Purchasing power: $1.2
trilliontrillion Lower annual income Lower annual income
than whitesthan whites ““Younger” subcultureYounger” subculture Technological focusTechnological focus Increasing media Increasing media
presencepresence Price consciousPrice conscious Unique buying patternsUnique buying patterns
Source: http://www.thevalueengineers.com
Asian Buying PatternsAsian Buying Patterns
Highly educatedHighly educated Strong family tiesStrong family ties Hard workingHard working Hesitant to use creditHesitant to use credit
Economic ForcesEconomic Forces
““Deals with the income, Deals with the income, expenditures, and resources that expenditures, and resources that affect the cost of running a business affect the cost of running a business or household”or household” MacroeconomicMacroeconomic MicroeconomicMicroeconomic
Macroeconomic ForcesMacroeconomic Forces
Deals with entire Deals with entire market- aggregate of market- aggregate of all “players” within it.all “players” within it. If consumers feel they If consumers feel they
will be better off, they will be better off, they will buy more.will buy more.
If consumers feel they If consumers feel they will be worse off, they will be worse off, they will opt to save money will opt to save money or be hesitant to spend or be hesitant to spend it.it.
Source: http://www.bookbyte.com
Microeconomic ForcesMicroeconomic Forces
Gross incomeGross income Total amount of money Total amount of money
earned annually by an earned annually by an individualindividual
Disposable IncomeDisposable Income Money remaining after Money remaining after
paying taxespaying taxes Discretionary IncomeDiscretionary Income
Money remaining after Money remaining after paying taxes and for paying taxes and for necessitiesnecessities
Source: http://www.principlesofmicroeconomics.net
Technological ForcesTechnological Forces
Becoming increasingly importantBecoming increasingly important As technology becomes more As technology becomes more
commonplace, prices fall.commonplace, prices fall. Designs new products or improves existing Designs new products or improves existing
onesones Improves systems and flow of informationImproves systems and flow of information
InternetInternet IntranetIntranet ExtranetExtranet
Competitive ForcesCompetitive Forces
““Alternative firms that could provide Alternative firms that could provide a product to satisfy a specific a product to satisfy a specific market’s need”market’s need” Perfect competitionPerfect competition MonopolyMonopoly OligopolyOligopoly Monopolistic competitionMonopolistic competition
Competitive ForcesCompetitive Forces
Porter’s ModelPorter’s Model Barriers to EntryBarriers to Entry Buyer PowerBuyer Power Supplier PowerSupplier Power Degree of RivalryDegree of Rivalry SubstitutesSubstitutes
Source: http://notesdesk.com/notes/strategy/porters-five-forces-model-porters-model/
Regulatory ForcesRegulatory Forces
““Restrictions state and federal laws place Restrictions state and federal laws place on business with regard to the conduct of on business with regard to the conduct of its activities.”its activities.”
Protect customers & companiesProtect customers & companies Regulatory agenciesRegulatory agencies
Consumer Product Safety CommissionConsumer Product Safety Commission Food & Drug AdministrationFood & Drug Administration Federal Trade CommissionFederal Trade Commission
Regulatory ForcesRegulatory Forces
Place-Related LegislationPlace-Related Legislation Exclusive dealingExclusive dealing Requirement contractsRequirement contracts Exclusive territorial distributorshipsExclusive territorial distributorships Tying arrangementTying arrangement
Promotion-Related LegislationPromotion-Related Legislation Federal Trade CommissionFederal Trade Commission