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Example of each of the marketing environment forces

Social and cultural Figure 9. To spot trends and other signals that conditions may be in flux, marketers must continually monitor the environment in which their companies operate. The Political and Regulatory Environment Federal, state, and local bodies can set rules or restrictions on the conduct of businesses.

The purpose of regulation is to protect both consumers and businesses. Businesses favor some regulations such as patent laws while chafing under others such as restrictions on advertising. The tobacco industry, for example, has had to learn to live with a federal ban on TV and radio advertising.

More recently, many companies in the food industry have expressed unhappiness over regulations requiring the labeling of trans-fat content. All these actions occasioned changes in the marketing strategies example of each of the marketing environment forces affected companies.

Tobacco companies rerouted advertising dollars from TV to print media. Food companies reduced trans-fat levels and began targeting health-conscious consumers. Talent coordinators posted red flags next to the names of Janet Jackson of the now-famous malfunctioning costume and other performers. The telemarketing industry fired workers and scrambled to reinvent its entire business model.

The Economic Environment Every day, marketing managers face a barrage of economic news. They must digest it, assess its impact, and alter marketing plans accordingly. At other times like todaythe news makes them nervous—our economy is weak, industrial production is down, jobless claims are rising, consumer confidence has plummeted, credit is hard to get.

Naturally, business thrives when the economy is growing, employment is full, and prices are stable. Marketing products is easier because consumers are willing to buy. Sales will slip, and to counteract the anticipated slowdown, you might have to add generous rebates to your promotional plans. The Competitive Environment Imagine playing tennis without watching what your opponent was doing. In particular, they need to monitor the activities of two groups of competitors: Coke and Pepsi, for instance, are brand competitors who have engaged in the so-called cola wars for decades.

Each tries to capture market share by convincing people that its soft drinks are better.

  1. Social Influences Here, we find four factors.
  2. Meanwhile, Coke and Pepsi have to watch Nantucket Nectars, whose fruit drinks are substitute products.
  3. Perhaps you wanted to prepare for a particular career, to become better educated, or to postpone going to work full time.
  4. Your predisposition to respond in particular ways because of learned values and beliefs. The process began when you recognized a need to go to college.

Because neither wants to lose share to the other, they tend to resort to similar tactics. In summer 2004, both companies came out with nearly identical new colas boasting half the sugar, half the calories, and half the carbohydrates of regular colas. Both companies targeted cola drinkers who want the flavor of a regular soda but fewer calories. By the way, both products failed and were taken off the market. Meanwhile, Coke and Pepsi have to watch Nantucket Nectars, whose fruit drinks are substitute products.

What if Nantucket Nectars managed to get its drinks into the soda machines at more example of each of the marketing environment forces restaurants? How would Coke and Pepsi respond? What if Nantucket Nectars, which markets an ice tea with caffeine, introduced an ice tea drink with mega amounts of caffeine?

Would marketers at Coke and Pepsi take action? What if Nantucket Nectars launched a marketing campaign promoting the health benefits of fruit drinks over soda? Would Coke and Pepsi reply with campaigns of their own?

Would they respond by introducing new non-cola products? Videotape makers who were monitoring technological trends in the industry would probably have taken steps to keep up go into DVDs or otherwise protect themselves from losses maybe even getting out of the market. In addition to making old products obsolete, technological advances create new products. Where would we be without the cell phone, digital cameras, text messaging, LASIK surgery, and global positioning systems?

Do you think DVDs will suffer the same fate as videocassettes? Consider the revolutionary changes brought about by the Internet, which offers marketers a new medium for promoting and selling a vast range of goods and services.

Marketers must keep abreast of technological advances and adapt their strategies, both to take advantage of the opportunities and to ward off threats. The Social and Cultural Environment Marketers also have to stay tuned to social and cultural factors that can affect sales. Think about the clothes you wore five years ago: Now put yourself in the place of a marketer for a clothing company that targets teenagers and young adults.

As we said at the outset of this chapter, the key to successful marketing is meeting the needs of customers. This means knowing what they want right now, not last year.

Marketing Environment

The last few decades have witnessed monumental shifts in the makeup of the American workforce. The number of women at all levels has increased significantly, the workforce has become more diverse, and telecommuting is more common. More people place more importance on balancing their work lives with the rest of their lives, and fewer people are willing to sacrifice their health to the demands of hectic work schedules.

With these changes have come new marketing opportunities. So must companies that specialize in products aimed at customers in other age brackets—say, young children or retirees. Marketers pay particular attention to population shifts because they can have dramatic effects on a consumer base, either increasing or decreasing the number of potential customers.

Marketers tend to assign most Americans born in the last sixty years to one of three groups: In addition to age, members of each group tend to share common experiences, values, and attitudes that stay with them as they mature.

These values and attitudes have a profound effect on both the products they want and the marketing efforts designed to sell products to them. Baby Boomers The huge wave of baby boomers began arriving in 1946, following World War II, and marketers have been catering to them ever since.

9.8 The Marketing Environment

What are they like? At this point in their lives, most are at their peak earning power and affluent enough to make marketers stand up and take notice. Generation Y When they became parents, baby boomers delivered a group to rival their own. They also seem to be coping fairly well: Bruce Tulgan and Carolyn A.

  1. Marketers tend to assign most Americans born in the last sixty years to one of three groups. In matching products with external factors, apply each factor only once.
  2. There will be other intermediaries as well including advertising agencies and trade unions amongst others. Some purchases are made without much thought.
  3. The purpose of regulation is to protect both consumers and businesses. By the way, both products failed and were taken off the market.
  4. How many times have you rethought your decision?

Generation Ys are being courted by carmakers. Global car manufacturers have launched a number of 2012 cars designed to cater to the members of Generation Y. In one desperate attempt to get their attention, an advertiser paid college students fifty cents to view thirty-second ads on their computers. Advertisers keep trying, because Generation Y is big enough to wreck a brand by giving it a cold shoulder. What information did you collect before making the decision? What factors did you consider when evaluating alternatives?

How did you make your final choice? Were you happy with your decision? To design effective strategies, marketers need to find the answers that consumers give to questions such as these.

In other words, they try to improve their understanding of consumer behavior Decision process that individuals go through when purchasing or using products. The Buying Process Generally speaking, buyers run through a series of steps in deciding whether to purchase a particular product.

  • Would you make the same choice again?
  • With these changes have come new marketing opportunities;
  • Businesses favor some regulations such as patent laws while chafing under others such as restrictions on advertising;
  • Were you happy with your decision?

Some purchases are made without much thought. Other purchases, however, require considerable thought.

For example, you probably spent a lot of time deciding which college to attend. The process began when you recognized a need to go to college.

Perhaps you wanted to prepare for a particular career, to become better educated, or to postpone going to work full time. Maybe your parents insisted.

Once you recognized the need to go to college, you probably started gathering information about colleges. You may have gone online and studied the Web sites posted by a few schools.

Perhaps you attended college fairs or spoke with your high school guidance counselor. You probably talked with friends about your options.

Once you let colleges know that you were interested, admissions departments likely sent you tons of information. First, you probably decided what you wanted from a college. Perhaps price was your number-one criterion, or maybe distance from home. Maybe size was important, or reputation or available majors. Maybe it was the quality of the football team or the male-to-female ratio. In so doing, you focused on what was most important to you. Naturally, you could choose only among schools that had accepted you.

How many times have you rethought your decision?

Marketing Environment – Micro and Macro Environments

Are you happy with it? Would you make the same choice again? Objectively, you may have made a bad decision, but not all decisions are made on a purely objective basis. Psychological and social influences come into play. Psychological Influences Under this category, we can identify at least five variables: The internal process that causes you to seek certain goals. The way you select, organize, and interpret information.

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Knowledge gained through experience and study. Your predisposition to respond in particular ways because of learned values and beliefs. The collection of attributes that characterize an individual.