Chapter 2 - The Marketing Environment

Question 1

Situation Analysis

Answer 1

taking stock of a firm’s or product’s past performance, where it is now, and where it is headed

Question 2

Environmental Scan (6) Factors

Answer 2

CRESTD
Competitive forces
Regulatory forces
Economic forces
Socio-cultural forces
Technological forces
Demographic forces

Question 3

Environmental Scan (definition)

Answer 3

process of continually acquiring info on events outside an organization to identify trends, opportunities, and threats to a business

Question 4

SWOT

Answer 4

Strengths
Weaknesses
Opportunities
Threats

Question 5

Demographics

Answer 5

Statistical study of populations

- gender, age, ethnicity, education, and occupation

Question 6

Baby Boomers

Answer 6

Born between 1946-1965

• keen interest in health and active self-image
• well educated
• culturally diverse
• brand loyal

Question 7

Generation X

Answer 7

Born between 1966-1980

• highly educated
• most have children
• high spending power
• loyal consumers

Question 8

Millennials (Gen Y)

Answer 8

Born between 1981-2000

• children of baby boomers
• highly influenced by technology

Question 9

Generation Z

Answer 9

Born after 2001

• do not know life without technology
• believe they can change the world
• expect to work longer/harder

Question 10

Socio-cultural forces

Answer 10

cultural values, ideas, and attitudes, as well as society’s morals and beliefs

Question 11

Showrooming

Answer 11

Using mobile devices in-store to check online competitive product reviews/prices, then buying it online for cheaper

Question 12

Binge viewing

Answer 12

watching complete or partial seasons of TV shows over a few days

Question 13

Social TV

Answer 13

watching TV programming while adding comments on social networks

Question 14

Economy

Answer 14

collective income, expenditures, and resources that effect the cost of running a business or household

Question 15

Macroeconomic forces

Answer 15

state of a country’s economy as a whole, indicated by growth rates, inflation rates, unemployment rates, and consumer confidence indexes

Question 16

Microeconomic forces

Answer 16

supply and demand of goods/services and how this is impacted by individual, household, and company decisions to purchase

Question 17

Gross Income

Answer 17

total amount of money made in one year, including taxes

Question 18

Disposable income

Answer 18

after-tax income that consumers have left for spending and savings

Question 19

Discretionary income

Answer 19

after-tax income a consumer has left after paying for necessities like food, shelter, clothing

Question 20

Technological forces

Answer 20

Inventions or innovations that stem from scientific or engineering research
- each new wave of technology can replace existing products

Question 21

Internet of Things (IoT)

Answer 21

network of products embedded with connectivity-enabled electronics

Question 22

Competitive forces

Answer 22

Direct and indirect competitors, as well as the competitive nature of the market
- Alternative products that can satisfy a specific market’s needs

Question 23

Direct Competitors

Answer 23

similar products sold in the same category

Question 24

Indirect Competitors

Answer 24

products competing for the same buying dollar in a slightly different but related category

Question 25

Regulations

Answer 25

Restrictions placed on businesses, products, or services by the government or industry associations

Question 26

Environmental Scan, Step 1:

Answer 26

Collect the facts & identify trends

• gather data and info
• conduct competitive reviews
• cluster info into facts and trends

Question 27

Environmental Scan, Step 2:

Answer 27

Determine the impact this fact/trend will have on the business

• set business objectives
• analyze external trends to determine their impact

Question 28

Environmental Scan, Step 3:

Answer 28

Brainstorm, evaluate, and implement ideas to meet business objectives

• brainstorm
• evaluate and implement alternatives

Question 29

Economic Forces

Answer 29

Consider macro- and micro- environmental factors

- reflect the state of overall economy as well as the ability of the consumers to spend