Chapter 3 & 5

Question 1

What is in the marketing environment?

Answer 1

This consists of actors and forces outside marketing that affect marketing managements ability to build and maintain successful relationships with target customers.

Question 2

What is the microenvironment?

Answer 2

The microenvironment is made up of the actors close to the company that affects its ability to serve its customers. Microenvironment actors include:
- The company
- Suppliers
- Marketing intermediaries
- Competitors
- Publics such as governmental, media, financial, general, and local publics.

Question 3

What is the macroenvironment?

Answer 3

The macroenvironment consists of the larger forces that affect the microenvironment, such as:
- Demographic
- Economic
- Natural
- Technological
- Political
- Cultural

Question 4

Define demography

Answer 4

Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation, and so on. Changes in this demographic environment have huge impacts on businesses, therefor leads to marketers having to pay close attention to the trend and developments in their marketers.

Question 5

What are some of the most important demographics trends in the US:

Answer 5

1. The changing age structure of the population. This is the most crucial demographic trend in the US. The 4 largest population groups are the baby boomers, generation X,, millennials, and generation Z.
   a. Baby boomers—> Born between 1945-1964
   b. Generation X—> Born between 1965-1976
   c. Millennials—> People born between 1977-2000
   d. Generation Z—> People born after 2000
   
   2. The changing American family. The traditional family of a husband, wife, and children have been changing due to the LBGTQ+ people ruining it.
   3. Geographic shifts in population. It is currently common for people to migrate between and within countries.
   4. A better educated, more white-collar, more professional population.
   5. Increasing diversity.

Question 6

Describe the economic environment-

Answer 6

The economic environment is made up of economic factors that affect consumer purchasing power and spending patterns, this has a huge affect on consumer spending and buying behavior.

Question 7

What is the natural environment?

Answer 7

This has to do with the physical environment and the natural resources that are required as inputs by marketers or that are affected by marketing activities. Marketers need to pay attention to a variety of trends in the natural environment that can affect companies and their marketing strategies. Such as:
- Shortages of raw materials
- Increased pollution
Increased government intervention.

Question 8

What is the environmental sustainability movement?

Answer 8

Due to the concern for the natural environment, this movement has been created. Several companies have started to develop strategies and practices that create a world economy that the planet can support indefinitely.

Question 9

Define the technological environment and how this affects marketing?

Answer 9

The technological environment is the force that creates new technologies and creates new products and market opportunities. This is crucial to marketers as this would depend on how impressed customers may seem with the products that they are promoting .

Question 10

Describe the political environment?

Answer 10

Governance also plays a huge role in marketing. They have set up may laws and regulations which influence and limit various organizations and individuals in a given society. Government agencies and pressure groups may also influence marketers and reasons for business legislation occurring is due to:
1. Protecting companies from each other.
2. Being able to protect consumers from unfair business practices.
3. Protecting the interests of society against unfair business practices.
Beyond laws, there are also several social codes and rules of profession ethics.

Question 11

Describe the cultural environment

Answer 11

It is made up of institutions and other forces that affect society’s basic values, perceptions, preferences, and behaviors. Core beliefs and values are passed down from the parents to children and are reinforced by schools, businesses, religious institutions, and government. Secondary beliefs and values are more open to change, and marketers have some part of changing those. Major cultural values of society are expressed in:
1. Peoples view of themselves
2. Peoples views of others
3. Peoples views of organizations
4. Peoples views of society
5. Peoples views of nature
Peoples views of the universe.

Question 12

It was once found that there are 3 kinds of companies:

Answer 12

1. Those who make things happen
   
   2. Those who watch things happen
      Those who wonder what’s happened

Question 13

“how do consumers respond to various marketing efforts the company might use?”.
This question is answered in the following model:

Answer 13

The environment—> Buyers black box—> Buyers responses

Question 14

Name the 4 p’s in the marketing mix or stimuli:

Answer 14

• Product
  
  • Price
  • Place
  • Promotion

Question 15

What are the 2 factors of buyers in the buyer’s black box?

Answer 15

• Buyers characteristics
  - Buyers decision process

Question 16

What are the 3 outcomes of buyer responses?

Answer 16

• Buying attitudes and preferences
  
  • Purchase behavior: what, when, where, and how much?
  • Brand engagements and relationships

Question 17

Consumer behavior is influenced by several factors, what are those 4 factors?

Answer 17

1. Cultural factors
   
   2. Social factors
   3. Personal factors
      Psychological Factors

Question 18

What effect do cultural factors have on consumer behavior?

Answer 18

The buyers culture, sub-culture, and social class all play a role in consumer behavior (a major one). Culture is defined as the set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions. A subculture is a group of people with shared value systems based on common life experiences and situations. The 3 most important subcultures in the US are:
1. Hispanic Americans
2. Asian Americans
3. African Americans

Question 19

How do you trailer marketing efforts to different sub-cultures?

Answer 19

Marketers are now embracing a total market strategy, which is the practice of integrating ethnic themes and cross-cultural perspectives within a brands mainstream marketing, appealing to consumer similarities across sub cultural segments rather than differences.

Question 20

Define social classes

Answer 20

Social classes- these are relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors.

Question 21

What effect do social factors have on consumer behavior?

Answer 21

Social factors have an influence on consumers behavior. This consists of small groups, social networks, family, and social roles and status. A group is considered 2 or more people who interact to accomplish individual or mutual goals.

Question 22

Define a membership group

Answer 22

A group that has a direct influence and to which a person belongs to.

Question 23

Define a reference group

Answer 23

These serve as direct or indirect points of comparison or reference in for manning a person’s attitude or behavior.

Question 24

Define word-of-mouth influence

Answer 24

This is the impact of the personal words and recommendations of trusted friends, family, associates, and other consumers on buying behavior.
Marketers of brands that are heavily influenced by groups have to figure out how to reach opinion leaders, which are people within a reference group who, due to special skills, knowledge, personality, or other characteristics, exert social influence on others.
Online social networking is a current example of a social interaction which contain communities such as blogs, online social media such as brand communities, and other online forums, where people socialize or exchange information and opinions, which generate an opportunity for marketers to gain preference over the consumers.

Question 25

Describe how personal characteristics affect buyers decisions

Answer 25

Consumer behavior or buyers decisions are also affected by personal characteristics, such as occupation, age, economic situation, lifestyle, personality, and self concept. Their lifestyle plays a huge role as it is the persons pattern of living, as shown in their activities, interests, and opinions. Personality is the unique psychological characteristics that distinguish a person or group.

Question 26

There are 4 psychological factors which affect a persons buying behavior:

Answer 26

1. Beliefs and attitudes
   
   2. Learning
   3. Motivation- a need that is sufficiently pressing to direct the person to seek satisfaction of the need.
   4. Perception

Question 27

Order Maslows hierarchy of needs from the bottom to the top:
Social needs, physiological needs, esteem needs, self-actualization needs, safety needs.

Answer 27

1. Physiological needs
   
   2. Safety needs
   3. Social needs
   4. Esteem needs
   5. Self-actualization needs.

Question 28

What are the 4 types of buying decision behavior?

Answer 28

1. Complex buying behavior- consumer buying behavior in situations characterized by high consumer involvement in a purchase and significant perceived differences among brands.
   
   2. Dissonance-reducing buying behavior- occurs in situations characterized by high involvement but few perceived differences among brands (i.e. BMW vs Audi)
   3. Habitual buying behavior- this takes place when consumer buying behavior is characterized by low consumer involvement and few significant perceived brand differences.
   4. Variety-seeking buying behavior- happens in situations characterized by low consumer involvement but significant perceived brand differences.

Question 29

Describe the 5 stages of the buyer’s decision process:

Answer 29

1. Need recognition- in which the consumer recognizes a problem or need.
   
   2. Information search- in which the consumer is motivated to search for more information.
   3. Alternative evaluation- in which the consumer uses information to evaluate alternative brands in the choice set.
   4. Purchase decision- where the buyers decision about which brand to purchase has been made.
   5. Postpurchase behavior- where the consumers take further action after purchase, based on their satisfaction or dissatisfaction. Almost all major purchases end in cognitive dissonance, which is buyer discomfort caused by Post-purchase conflict.

Question 30

What are the 5 stages customers go through in the process of adopting a new product?

Answer 30

1. Awareness- where the consumer becomes aware of the new product but lacks information about it.
   
   2. Interest- where the consumer seeks information about the new product.
   3. Evaluation- where the consumer considers whether trying the new product makes sense.
   4. Trial- Where the consumer tries the new product on a small scale to improve their estimate of its value.
   5. Adoption- where the consumer decides to make full and regular use of the new product.

Question 31

What are the 5 different adopters who have differing values?

Answer 31

1. Innovators- who are venturesome, they try new ideas at some risk.
   
   2. Early adopters- who are guided by respect, they are opinion leaders in their communities and adopt new ideas early but carefully.
   3. Early mainstream adopters- who are deliberate, although they are rarely leaders, they adopt new ideas before the average person.
   4. Late mainstream adopters- who are skeptical, they adopt an innovation only after a majority of people have tried it.
   5. Lagging adopters- who are tradition bound, they are suspicious of changes and adopt the innovation only when it has become something of a tradition itself.