Chapter 2 - The Marketing Environment Flashcards
Situation Analysis
taking stock of a firm’s or product’s past performance, where it is now, and where it is headed
Environmental Scan (6) Factors
CRESTD Competitive forces Regulatory forces Economic forces Socio-cultural forces Technological forces Demographic forces
Environmental Scan (definition)
process of continually acquiring info on events outside an organization to identify trends, opportunities, and threats to a business
SWOT
Strengths
Weaknesses
Opportunities
Threats
Demographics
Statistical study of populations
- gender, age, ethnicity, education, and occupation
Baby Boomers
Born between 1946-1965
- keen interest in health and active self-image
- well educated
- culturally diverse
- brand loyal
Generation X
Born between 1966-1980
- highly educated
- most have children
- high spending power
- loyal consumers
Millennials (Gen Y)
Born between 1981-2000
- children of baby boomers
- highly influenced by technology
Generation Z
Born after 2001
- do not know life without technology
- believe they can change the world
- expect to work longer/harder
Socio-cultural forces
cultural values, ideas, and attitudes, as well as society’s morals and beliefs
Showrooming
Using mobile devices in-store to check online competitive product reviews/prices, then buying it online for cheaper
Binge viewing
watching complete or partial seasons of TV shows over a few days
Social TV
watching TV programming while adding comments on social networks
Economy
collective income, expenditures, and resources that effect the cost of running a business or household
Macroeconomic forces
state of a country’s economy as a whole, indicated by growth rates, inflation rates, unemployment rates, and consumer confidence indexes
Microeconomic forces
supply and demand of goods/services and how this is impacted by individual, household, and company decisions to purchase
Gross Income
total amount of money made in one year, including taxes
Disposable income
after-tax income that consumers have left for spending and savings
Discretionary income
after-tax income a consumer has left after paying for necessities like food, shelter, clothing
Technological forces
Inventions or innovations that stem from scientific or engineering research
- each new wave of technology can replace existing products
Internet of Things (IoT)
network of products embedded with connectivity-enabled electronics
Competitive forces
Direct and indirect competitors, as well as the competitive nature of the market
- Alternative products that can satisfy a specific market’s needs
Direct Competitors
similar products sold in the same category
Indirect Competitors
products competing for the same buying dollar in a slightly different but related category
Regulations
Restrictions placed on businesses, products, or services by the government or industry associations
Environmental Scan, Step 1:
Collect the facts & identify trends
- gather data and info
- conduct competitive reviews
- cluster info into facts and trends
Environmental Scan, Step 2:
Determine the impact this fact/trend will have on the business
- set business objectives
- analyze external trends to determine their impact
Environmental Scan, Step 3:
Brainstorm, evaluate, and implement ideas to meet business objectives
- brainstorm
- evaluate and implement alternatives
Economic Forces
Consider macro- and micro- environmental factors
- reflect the state of overall economy as well as the ability of the consumers to spend
