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Exchange Functions

Promote and enable transfer to ownership. Ex: buying, selling, advertising

Physical Functions

Enables flow of goods from manufacturer to consumer. Ex: processing, transporting, packaging

Facilitating Functions

Assist in the execution of exchange and physical functions. Ex: financing and risk-taking, marketing information and research

Sub-Environments of Macroenvironment

Economic. Social and Cultural. Technology, and Legal


Inflation, income and unemployment levels

Social & Cultural

Demographics like age, sex, household structure


Based on scientific actions and innovations


Provide rules and penalties for violations. Designed to protect society

Importance of Segment Markets

Allows businesses to look at consumers as several different groups instead of one

Four Types of Variables

Demographic, Geographic, Loyalty, and Usage Rates

Product Life Cycle

Provides a clear framework for sales and profit levels over time


New product is introduced to the market place


Products gain acceptance, sales increase rapidly


Sales growth peaks and eventually flatten


Sales and profits fall

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