38 terms

Chapter 4

STUDY
PLAY

Terms in this set (...)

Marketing environment
The actors and forces outside marketing that affect marketing management's ability to build and maintain successful relationships with target customers.
Microenvironment
Who is included? (C,S,MI,C,C,P)
The actors close to the company that affect its ability to serve its customers --
the company, suppliers, market intermediaries, customer markets, competitors and publics.
Macroenvironment
Forces in this environment? (6) (DENTPC)
The larger societal forces that affect the microenvironment--
demographic, economic, natural, technological, political, and cultural forces.
Marketing intermediaries
Firms that help the company to promote, sell, and distribute its goods to final buyers.
Public
Any group that has an actual or potential interest in or impact on an organization's ability to achieve its objectives.
Demography
The study of human populations in terms of size, density, locations, age, gender, race, occupation, and other statistics.
Baby boomers
The 9.8 million Canadians born during the baby boom following WW2 and lasting until the mid 1960s
Generation X
The 7 million Canadians born between 1967 and 1976 in the "birth dearth" following the baby boom.
Millennials (or generation Y)
The 10.4 million children of the Canadian Baby Boomers, born between 1977 and 2000.
Economic environment
Factors that affect consumer buying power and spending patterns
Natural environment
Natural resources that are needed as inputs by marketers or that are affected by marketing activities
Environmental sustainabilty
Developing strategies and practices that create a world economy that the planet can support indefinetly
Technological environment
Forces that create new technologies, creating new product and market opportunities
Political environment
Laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society
Cultural environment
Institutions and other forces that affect society's basic values, perceptions, preferences and behaviours.
What environmental forces affect the company's ability to serve its customers in the micro and macro environments? Describe them.
Microenvironment
- internal environment: several departments and management levels
-Marketing channel firms: suppliers and marketing intermediaries, including resellers, physical distribution firms, marketing services agencies and financial intermediaries
-Competitors
-Publics
-suppliers
-Customer Markets: consumer, business, reseller, government and international

Macroeconomics
-demographic, economic, natural, technological, political, and cultural forces.
What are the 7 kinds of publics? Define them. (FMCLGI)
Financial publics: this group influences the company's ability to obtain funds. Banks, investment houses, and stockholders are the major financial publics.
Media publics: This group carries news, features, and editorial opinion. It includes newspapers, magazines, television stations, and blogs and other internet media.
Government publics: Management must take government developments into account. Marketers must often consult the company's lawyers on issues of product safety, truth in advertising, and other matters
Citizen-action publics: A company's marketing decisions may be questioned by consumer organizations, environmental`
Local publics
General public
Internal publics
Internal environment is a _____ environment

It includes? (2)
Controllable

The company (management, finances etc)
External environment is a _______ environment

It includes? (6)
Uncontrollable environment

a. consumers
b. competition
c. suppliers and distributers
d. economic and technological environment
e. political and legal environment
f. independent media
The cultural and social environment (consumers)

1.What does it affect?
2.How fast does it change in comparison to the other environments?
• affects how people live and behave which affects consumer behavior and eventually the economic, political and legal environment.

• cultural environment changes more slowly than economic, technological and political environment but has far-reaching effects.
What 2 factors influences strategic planning and the target market? (2) (DC)
• Demographic factors
• Cultural Factors
The economic environment:

What does it affect?

What is its base provided by?

How does it affect marketing? (3)

What do exchange rates influence? (2)
• affects how the firm and the whole economy uses resources.

• the technological environment provides a base for the economic environment. The technical skills and equipment affect how companies convert an economy's resources into output.

• the economic environment affects marketing by:
affecting consumer spending confidence esp. big ticket items.
inflation and interest rates affects when and if we will buy.
inflation affects price which is part of the strategic planning, therefore inflation affects strategic planning.

• Exchange rates impact international trade -
they influence demand for foreign merchandise. E.g. Japanese cars. Thereby affecting local competition.
influence exports. Cheaper currency makes our products cheaper vis-à-vis other producers thereby increasing demand for our goods.
Disposable income
the money consumer is left with after taxes are paid. It is a measure of what is left with the consumer to pay for necessities. It determines the purchasing power.
Discretionary Income
Is the amount of money consumer is left with after paying for necessities.
How has technology affected marketing? (3)
a. new products development
b. new processes (ways of doing things) - making it cheaper and more efficient.
c. movement from industrial society to a information society.
What are the 4 types of economic systems?
a. Pure competition - many sellers with identical products or commodities and many buyers. No one has to power to influence price.

b. Oligopoly - A few, big companies control the market. Eg Gasoline companies in Canada.

c. monopolistic competition - a large number of sellers, some large and some small compete with each other by offering similar or substitute products.

d. Monopoly - One company controls the market
What does the competitive environment affect?
• affects the number and types of competitors the business must face and how they behave.
what characteristics of their competitive environment (competitors) must firms assess? (4) (I,MS,N,S)
• The industry structure
• Their competitors' marketing strategies
• The nationality of their competitors (domestic and foreign)
• The size of their competitors
Is the D curve positive or negative under monopolistic competition?
Negative
Competitor analysis
an organized approach for evaluating the SWOT of current and potential competitor's marketing strategies.
What are the steps in doing a competitor analysis? (5)
1. identify present and potential competitors - look at direct and indirect competitors of your product which address same/similar needs. E.g. in diapers the competitors will be cloth diaper maker, disposable diaper makers, diaper rental services.
2. identify and consider factors that are competitive barriers in the market you operate in - conditions that make it difficult or impossible for firms to enter and compete in a market. Such barriers could be your strength or weakness.
3. Narrow focus of analysis on Competitive rivals - firms that will be the closest competitors.
4. Seek information about these competitors from newspapers, clipping service providers, sales reps, intermediaries, industry experts, customers.
5. compare strengths and weaknesses of our marketing mix with competitor's marketing mix.
What has lead to changes in the Legal and Regulatory environment?
changes in the political and economic environment
Competition Bureau (2)
Part of Industry Canada

Ensures competitors engage in fair competition through the competition act and enforces regulation on price fixing, deceptive price advertising, regulating telemarketing, etc.
Office of Consumer Affairs
Ensures consumers' rights are protected in the market place
Consumerism
social movements that seek to increase rights and powers of consumers and buyers in relation to sellers and the government
Consumer and Corporate Affairs Canada (CCAC)
Administer consumer protection laws and focus efforts on consumer education and consumer awareness
How can suppliers and distributers make the firm vulnerable? (2)
When there are few suppliers

Competitors gain a competitive advantage if they had access to the same suppliers
How does the Government/Political environment affect the business environment? (3) (PS,N,N)
1. Political Stability - Increasing or decreasing the level of political uncertainty which can impact the business environment.
2. Strong Nationalism - placing of a country's interests before
everything else. Affects marketing by
• influencing consumer behavior by changing attitudes
toward foreign goods e.g. "buy American".
• Creation of unified markets such as
3. NAFTA/European Union (EU).
• increases the size of the market available to firms.
• new trade policies and regulations.
• single currency Euro - facilitates trade.