The Marketing Environment

ROAD MAP: Previewing the Concepts

• Describe the environmental forces that affect the
company’s ability to serve its customers.
• Explain how changes in the demographic and
economic environments affect marketing
decisions.
• Identify the major trends in the firm’s natural and
technological environments.
• Explain the key changes in the political and
cultural environments.
• Discuss how companies can react to the marketing
environment.

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 Marketing Environment
• The marketing environment consists of actors
and forces outside the organization that affect
management’s ability to build and maintain
relationships with target customers.
• Environment offers both opportunities and
threats.
• Marketing intelligence and research used to
collect information about the environment.

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 Marketing Environment

• Includes:
– Microenvironment: actors close to the
company that affect its ability to serve its
customers.
– Macroenvironment: larger societal forces that
affect the microenvironment.
• Considered to be beyond the control of the
organization.

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The Company’s Microenvironment
• Company’s Internal Environment:
– Areas inside a company.
– Affects the marketing department’s
planning strategies.
– All departments must “think consumer” and
work together to provide superior customer
value and satisfaction.

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Actors in the Microenvironment

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The Company’s Microenvironment

• Suppliers:
– Provide resources
needed to produce
goods and services.
– Important link in the
“value delivery
system.”
– Most marketers treat
suppliers like partners.

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 The Company’s Microenvironment

• Marketing Intermediaries:
– Help the company to promote, sell, and distribute
its goods to final buyers
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries

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Partnering With Intermediaries

Coca-Cola provides
Wendy’s with much
more than just soft
drinks. It also pledges
powerful marketing
support.

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The Company’s Microenvironment

• Customers:
– Five types of
markets that
purchase a
company’s goods
and services

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 The Company’s Microenvironment
• Competitors:
– Those who serve a target market with products
and services that are viewed by consumers as
being reasonable substitutes
– Company must gain strategic advantage against
these organizations
• Publics:
– Group that has an interest in or impact on an
organization's ability to achieve its objectives

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Types of Publics

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 The Macroenvironment

• The company and all of the other actors

operate in a larger macroenvironment of
forces that shape opportunities and pose
threats to the company.

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The Company’s Macroenvironment

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The Company’s Macroenvironment

• Demographic:
– The study of human populations in terms of
size, density, location, age, gender, race,
occupation, and other statistics.
– Marketers track changing age and family
structures, geographic population shifts,
educational characteristics, and population
diversity.

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 Economic Environment

Consists of factors that affect consumer

purchasing power and spending patterns.

• Changes in Income • Income Distribution

– 1980’s – consumption
frenzy
– 1990’s – “squeezed
consumer”
– 2000’s – value marketing
– Upper class
– Middle class
– Working class
– Underclass

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 Income Distribution

Walt Disney markets two distinct Pooh bears to match its two-
tiered market.
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 Natural Environment

• Involves the natural

resources that are
needed as inputs by
marketers or that are
affected by marketing
activities.

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Factors Impacting the Natural
Environment

Shortages of Raw Materials

Increased Pollution

Increased Government Intervention

Environmentally Sustainable Strategies

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Environmental Responsibility

McDonald’s has made a substantial commitment to the so-called

“green movement.”
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Technological Environment

• Most
dramatic
force now
shaping our
destiny.

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 Technological Environment
• Changes rapidly.
• Creates new markets
and opportunities.
• Challenge is to make
practical, affordable
products.
• Safety regulations result
in higher research costs
and longer time between
conceptualization and
introduction of product.

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 Political Environment

Includes Laws,
Increasing Legislation
Government
Agencies, and
Pressure Groups
Changing Government
that Influence or Agency Enforcement
Limit Various
Organizations and
Individuals In a Increased Emphasis on Ethics
Given Society. & Socially Responsible Actions

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 Cultural Environment

• The institutions
and other forces
that affect a
society’s basic
values,
perceptions,
preference, and
behaviors.

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 Cultural Environment

• Core beliefs and values are passed on

from parents to children and are
reinforced by schools, churches, business,
and government.
• Secondary beliefs and values are more
open to change.

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 Cultural Environment
• Yankelovich Monitor has identified eight
major consumer value themes:
1. Paradox
2. Trust not
3. Go it alone
4. Smarts really count
5. No sacrifices
6. Stress hard to beat
7. Reciprocity is the way to go
8. Me 2
• www.yankelovich.com 3-26
Cultural Environment
Themselves Society’s Major
Cultural Views Are
Others Expressed in
People’s Views of:

Organizations

Society

Nature

The Universe
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 Responding to the Marketing Environment
• Environmental Management Perspective
• Taking a proactive approach to managing the
environment by taking aggressive (rather than
reactive) actions to affect the publics and forces
in the marketing environment.
• This can be done by:
– Hiring lobbyists
– Running “advertorials”
– Pressing lawsuits
– Filing complaints
– Forming agreements to control channels

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Interactive Student
Assignment
• Pair with another student to discuss the
following questions:
– In what ways does the buying behavior of
you and your parents differ?
– In what ways does the buying behavior of
you and your grandparents differ?
– What selling strategies would work best for:
• You
• Your parents
• Your grandparents
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Discussion Questions

• Within the last ten years, which

technological force has had the greatest
impact on marketing? In what areas of
marketing has this impact been seen?

• What technological force has impacted

you the most? In what ways has this
occurred?

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