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Principles of Marketing

The
Marketing Environment
The Marketing Environment

The marketing environment includes

the actors and forces outside
marketing that affect marketing
management’s ability to build and
maintain successful relationships with
customers

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The Marketing Environment

Marketing Environment

Microenvironment consists of the actors

close to the company that affect its
ability to serve its customers, the
company, suppliers, marketing
intermediaries, customer markets,
competitors, and publics

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The Company’s
Microenvironment
Marketing Environment

Macroenvironment consists of the larger societal

forces that affect the microenvironment
• Demographic
• Economic
• Natural
• Technological
• Political
• Cultural

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The Company’s
Microenvironment

• The Company
• Suppliers
• Marketing intermediaries
• Customers
• Competitors
• Publics

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The Company’s
Microenvironment

The Company

Internal environment includes:

• Top management
• Finance
• R&D
• Purchasing
• Operations
• Accounting
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The Company’s
Microenvironment

Suppliers

• Provide the resources to produce

goods and services
• Treated as partners to provide
customer value

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The Company’s
Microenvironment
Marketing Intermediaries
• Help the company to promote,
sell, and distribute its products
to final buyers
• Include:
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries

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The Company’s
Microenvironment

Marketing Intermediaries

Resellers are the distribution channel

firms that help the company find
customers or make sales to them
• Include:
• Wholesalers
• Retailers
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The Company’s
Microenvironment

Marketing Intermediaries

Physical distribution firms are the

distribution channel firms that help the
company to stock and move goods
from their points of origin to their final
destination

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The Company’s
Microenvironment

Marketing Intermediaries

Marketing service agencies are the

marketing research firms, advertising
agencies, media firms, and marketing
consulting firms that help the company
target and promote its products to the
right markets

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The Company’s
Microenvironment

Marketing Intermediaries

Financial intermediaries include banks,

credit companies, insurance
companies, and other businesses that
help finance transactions or insure
against the risks associated with the
buying and selling of goods

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The Company’s
Microenvironment
Customers

Customer markets consist of individuals

and households that buy goods and
services for personal consumption

Business markets buy goods and services

for further processing or for use in their
production process

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The Company’s
Microenvironment
Customers

Reseller markets buy goods and services to

resell at a profit

Government markets buy goods and services

to produce public services or transfer goods
and services to others who need them

International markets consist of buyers in

other countries including consumers,
producers, resellers, and governments
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The Company’s
Microenvironment

Competitors

Firms must gain strategic advantage by

positioning their offerings against
competitors’ offerings

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The Company’s
Microenvironment
Publics

Financial publics influence the company’s

ability to obtain funds—banks, investment
houses, and stockholders
Media publics carry news, features, and
editorial opinion—newspapers, magazines,
and radio and television stations
Government publics influence product
safety and truth in advertising

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The Company’s
Microenvironment

Publics

Citizen-action publics include consumer

organizations, environment groups, and
minority groups
Local publics include neighborhood residents
and community organizations
General publics influence the company’s public
image
Internal publics include workers, managers,
volunteers, and directors
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The Company’s
Macroenvironment
Demographic Environment

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

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The Company’s
Macroenvironment

Demographic Environment
Changing Age Structure of the Population

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

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The Company’s
Macroenvironment
Demographic Environment
Changing Age Structure of the Population

Baby boomers include people born

between 1946 and 1964
• Most affluent Americans

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The Company’s
Macroenvironment
Demographic Environment
Changing Age Structure of the Population

Generation X includes people born between

1965 and 1976
• High divorce rates
• Concerned about the environment
• Respond to socially responsible companies
• Less materialistic
• Quality of life
• Consumer organizations, environment groups, and
minority groups

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The Company’s
Macroenvironment
Demographic Environment
Changing Age Structure of the Population

• Generation Y includes people

born between 1977 and 2000
• Internet generation

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The Company’s
Macroenvironment
Demographic Environment
The Changing American Family

More people are:

• Divorcing or separating
• Choosing not to marry
• Choosing to marrying later
• Marrying without intending to have children
• Higher divorce rates
• Increased number of working women
• Stay-at-home dads
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The Company’s
Macroenvironment
Demographic Environment
Geographic Shifts in Population

• Trends include:
• Migratory movements between and
within countries
• Moving from rural to metropolitan areas
• Changes in where people work
• Telecommuting
• Home office
• Divorcing or separating

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The Company’s
Macroenvironment

Demographic Environment
Increasing Diversity

• Markets are becoming more diverse

• International
• National
• Trends Include:
• Ethnicity
• Gay and lesbian
• Disabled

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The Company’s
Macroenvironment

Economic Environment
Changes in Income

• Income distribution
• Upper-class consumers
• Middle-class consumers
• Working-class consumers
• Underclass consumers

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The Company’s
Macroenvironment
Natural Environment

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
• Increased government intervention
• Environmentally sustainable strategies
• Green marketing

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The Company’s
Macroenvironment

Political Environment

Political environment consists of laws,

government agencies, and pressure
groups that influence or limit various
organizations and individuals in a
given society

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The Company’s
Macroenvironment
Political Environment

• Legislation regulating business

• Public policy to guide commerce—sets of
laws and regulations that limit business for
the good of society at large
• Increasing legislation
• Protect companies
• Protect consumers
• Protect the interests of society

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The Company’s
Macroenvironment

Political Environment
Increased Emphasis on Ethics and Socially Responsible
Actions

Socially responsible behavior occurs

when firms actively seek out ways to
protect the long-term interests of their
consumers and the environment
• Cause-related marketing
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The Company’s
Macroenvironment

Cultural Environment

Cultural environment consists of

institutions and other forces that affect
a society’s basic values, perceptions,
and behaviors

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The Company’s
Macroenvironment

Cultural Environment
Persistence of Cultural Values

Core beliefs and values have a high

degree of persistence, 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
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The Company’s
Macroenvironment

Cultural Environment
Shifts in Secondary Cultural Values

Major cultural values of a society are expressed

in people’s view of:
• Themselves
• Others
• Organization
• Society
• Nature and the universe
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The Company’s
Microenvironment

Cultural Environment
Shifts in Secondary Cultural Values

• People’s view of themselves

• Yankelovich Monitor’s consumer segments:
• Do-It-Yourselfers—recent movers
• Adventurers
• People’s view of others

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The Company’s
Macroenvironment

Cultural Environment
Shifts in Secondary Cultural Values

• People’s view of organizations

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

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The Company’s
Macroenvironment

Cultural Environment
Shifts in Secondary Cultural Values

• People’s view of nature

• Some feel ruled by it
• Some feel in harmony with it
• Some seek to master it
• People’s view of the universe
• Renewed interest in spirituality

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