ch3 analyzing-the-marketing

Chapter 3- slide 1Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall

The Company’s Macroenvironment



Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation, and other statistics

• Demographic environment is important because it involves people, and people make up markets

• Demographic trends include age, family structure, geographic population shifts, educational characteristics, and population diversity

Demographic Environment



• Changing age structure of the population _ The post world war II baby boom produced

78 million– Baby boomers include people born between 1946

and 1964– Most affluent Americans– The baby boomers have been one of theMost powerful forces shaping the marketingEnvironment




• Generation X includes people born between 1965 and 1976– High parental divorce rates– Cautious economic outlook as they grown up

during time of recession & corporate downsizing




– Less materialistic “ they prize experience not acquisition “

– Family comes first, career second– Lag behind on retirement savings




• Millennials (gen Y or echo boomers) include those born between 1977 and 2000– Comfortable with technology– Includes

• Tweens (ages 8–12)• Teens (13–19)• Young adults (20’s)




Generational marketing is important in segmenting people by lifestyle of life state instead of age.

some experts warn marketers to be careful about turning off one generation each time they craft a product or message that appeals effectively to another




More people are:• Divorcing or separating• Choosing not to marry• Choosing to marry later• Marrying without intending to have

children• Increased number of working women• Stay-at-home dads




• Growth in U.S. West and South and decline in Midwest and Northeast

• Moving from rural to metropolitan areas

• Changes in where people work– Telecommuting “ work at home

or in a remote office to conduct the business by phone, fax or internet”

– Home office– Divorcing or separating




• Changes in the Workforce– More educated, the increased

number of educated people will increase the demand for quality products, books , magazines, and personal computers

– More white collar




Demographic EnvironmentIncreased Diversity

Markets are becoming more diverse– International– National

• Includes:– Ethnicity– Gay and lesbian– Disabled



Economic environment consists of factors that affect consumer purchasing power and spending patterns

• Nations vary greatly in their levels and distribution of income, some countries have the industrial economies which constitute rich markets for many different kinds of goods

Economic Environment



• Subsistence economies consume most of their own agriculture and industrial output and offer few market opportunities

• In between are developing economies which can offer outstanding marketing opportunities for the right kinds of products




• Changes in income• Value marketing involves

ways to offer financially cautious buyers greater value—the right combination of quality and service at a fair price




• Ernst Engel—Engel’s LawDifferences noted over a century ago by Ernst

Engel in how people shift their spending across food, housing, transportation, health care, and other goods and services categories as family income rises

Economic EnvironmentChanges in Consumer Spending Patterns



• As income rises:– The percentage spent on food declines– The percentage spent on housing remains

constant– The percentage spent on savings increases

Economic EnvironmentChanges in Consumer Spending Patterns



Natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities

• Trends– Shortages of raw materials– Increased pollution– Increase government intervention– Environmentally sustainable strategies

Natural Environment



• Environmental sustainability:Developing strategies and practices that

create a world economy that the planet can support indefinitely, they are responding to consumer demands with more environmentally responsible products.

Natural Environment



• Forces that create new technologies, creating new products and market

opportunities

Technological Environment



Technological Environment

• Most dramatic force in changing the marketplace

• Creates new products and opportunities

• Safety of new product always a concern



Political environment consists of laws, government agencies, and pressure groups that influence or limit various organizations and individuals in a given society

Political Environment



• Legislation regulating business– Increased legislationBusiness legislation has been

enacted for two reasons:1.To protect companies from each

other2.To protect consumers from unfair

business practices such as telling lies in the advertisement




_ Changing government agency enforcement * International marketers will encounter dozens, or

even hundreds of agencies set up to enforce trade policies and regulations.

* Marketers need to know about major laws protecting competition, consumers and society. They need to understand these laws at local, national and international levels




• Increased emphasis on ethics– Socially responsible behavior” companies

encourage their managers to look beyond the regulatory system allows and simply “ do the right things “ these socially responsible firms seek out ways to protect the long run interests of their consumers and the environment”




– Cause-related marketing:• To exercise the social responsibility and build more

positive images, many companies are now linking themselves to worthwhile causes. These days, every product seems to be tied to some cause.

• This concept link the purchases of the company products and services with fundraising for worthwhile causes or charitable organizations.

• But this concept can be a more strategy for selling than a strategy for giving




Cultural environment consists of institutions and other forces that affect a society’s basic values, perceptions, and behaviors

Cultural Environment



Core beliefs and values are persistent and are passed on from parents to children and are reinforced by schools, churches, businesses, and government

Secondary beliefs and values are more open to change and include people’s views of themselves, others, organization, society, nature, and the universe

Cultural EnvironmentPersistence of Cultural Values



• People’s view of themselves– Yankelovich Monitor’s consumer

segments:• Do-it-yourselfers—recent movers“ embodying the whole do-it-yourself

attitude”• Adventurers“ They like to view themselves as

doing things others wouldn’t dare to do”

Cultural EnvironmentShifts in Secondary Cultural Values



• People’s view of others– More “cocooning” : in which people are going out

less with others and are staying home more to enjoy the creature comforts of home and hearth – from the networked home office to home entertainment centers.




• People’s view of organizations“people vary in their attitudes towards

corporations, government agencies , universities and trade unions”

• People’s view of society– Patriots defend it– Reformers want to change it– Malcontents want to leave it


ch3 analyzing-the-marketing

Education

prentice hall

pearson education

segmenting people

markets demographic

age structure

baby boomers

family structure

geographic population