Chapter 3 - Analyzing Marketing Environment Flashcards
what results from analyzing marketing environment and give an example
1) means firms can adapt product offerings to meet new challenges and opportunities
2) Example: plastic bags and shift to reusable
what do we analyze and assess?
1) industry and competition
2) macroenvironment (context) and micoenvironment
3) firm’s offer (internal company analysis)
explain the marketing environment diagram
1) consumer in center who is influenced by microenvironment
2) the microenvironment and indirectly the consumer are influenced by macroenvironment
3 things included in micoenvironment
1) company capabilities
2) corporate partners
3) competition
things included in macroenvironment
1) culture
2) demographics
3) social/natural
4) tech
5) economic
6) political/legal
strategy vs tactic
strategy - overarching plan or set of goals
tactic - specific actions or steps you take to accomplish strategy
microenvironment factors: explain company capabilities - 2 points
1) Successful marketing efforts focus on satisfying customers needs that match their core competencies
2) firm level and offer level
microenvironment factors: company capabilities at firm level
Assess organization’s marketing health like financial resources, HR, physical resources, soft resources (software, systems), your market offer
microenvironment factors: company capabilities at offer level
Need to understand: how the market offer fits relative to customer expectations, what sets it apart from competitors (source of differentiation), returns generated or anticipated
microenvironment factors: competition:
1) More competition means more choices which influences buying decisions
2) Firms must understand competition SWOT
microenvironment factors: competition: define competitive intelligence - 2 points and an example
1) used by firms to collect and synthesize info about their position with respect to rivals
2) enables companies to anticipate changes in the marketplace rather than merely react to them
3) Example: having employees visit competitor’s store
microenvironment factors: competition: 5 questions to ask
1) who are our key competitors?
2) How intense is competition in our market
3) How do competitive actions affect our marketing decisions?
4) How do firms get and keep their competitive advantage?
5) Barriers to entry and exit
microenvironment factors: competition: 5 things to use to compare firm to competition
1) product quality
2) reputation with dealers
3) customer satisfaction
4) innovativeness
5) after-sales support
microenvironment factors: define corporate partners - 3 points
1) Corporate partners are parties that work with the firm
2) ex. Suppliers, transport companies
3) may be integrated - Some corporate partners will only work with firms that are environmentally sustainable
define macroenvironmental factors
aspects of the external environment (CDSTEP) that affect companies
macroenvironmental factors: culture - 3 points
1) shared meanings, beliefs, morals, values and customs of a group of people
2) Transmitted by words, literature, institutions; passed down; learned over time
3) Cultures influence what we buy
macroenvironmental factors: 2 dimensions of culture
1) country culture
2) regional subculture
macroenvironmental factors: define country culture
Easy-to-spot visible nuances that are particular to a country, like dress, symbols, ceremonies, language, colours, food, and more subtle aspects that are trickier to identify
macroenvironmental factors: example of regional subculture
Quebec vs ontario residents shop differently
macroenvironmental factors: define demographics
Characteristics of human populations and segments, especially those used to identify consumer markets
macroenvironmental factors: 5 types of demographics
1) generational cohorts
2) income
3) education
4) gender
5) ethnicity
macroenvironmental factors: generational cohorts - 2 points
1) A group of people of the same generation who typically have similar purchase behaviours because they have shared experiences and are in the same stage of life
2) Applying age to identify consumers is helpful if used with other consumer characteristics
macroenvironmental factors: how can we use education for demographics
High school students spend money different than university students
macroenvironmental factors: how can we use gender for demographics - 2 points
1) Women make the majority of purchase decisions
2) More firms are being careful about gender neutrality in positioning their products
macroenvironmental factors: how can we use ethnicity for demographics - 2 points
1) Ethnic canadians spend more than whites on big ticket items; many like brand names because they equate them to quality
2) They also have different food preferences
macroenvironmental factors: explain tech advances - 2 points
1) Tech changes that have contributed to the improvement of the value of both products and services in the past few decades
2) Tech advances make consumers dependent on help they can provide (example Netflix suggests shows to watch)
macroenvironmental factors: define economic situation
Economic changes that affect the way consumers buy merchandise and spend money
macroenvironmental factors: 4 factors in economic situation
1) rate of inflation
2) foreign exchange rate
3) interest rates
4) recession
macroenvironmental factors: explain inflation - 2 points
1) define: persistent increase in prices of goods
2) causes purchasing power to decline
macroenvironmental factors: explain foreign exchange rate - 2 points
1) define: changes in the value of a country’s currency relative to the currency of another country
2) Can affect firms that import/export products; raw materials may be cheaper elsewhere where currency is cheaper
macroenvironmental factors: explain interest rates - 2 points
1) define: cost of borrowing money
2) If interest rates rise, consumers have incentive to save more
macroenvironmental factors: define recession
period of economic downturn when economic growth of country is negative for at least 2 consecutive quarters
macroenvironmental factors: consumer behaviour in recession
Consumers postpone big-ticket purchases and look for deals
macroenvironmental factors: what does political/legal environment comprise
Comprises political parties, gov organizations, legislations and laws that promote or inhibit trade and marketing activities
macroenvironmental factors: how does political/legal environment affect firm - 4 points
1) Firm’s must understand laws around fair competition, consumer protection
2) Firms cannot have false or misleading advertising
3) Certain laws create opportunities to sell more products
4) Example: illegal to use cell phone in car so bluetooth devices were marketing
social/natural trends impact marketing: 5 trends in social/natural trends?
1) greener consumers
2) marketing to children
3) privacy concerns
4) time-poor society
5) health and wellness concerns
social/natural trends impact marketing: greener consumers: define green marketing
strategic effort by firms to supply customers with environmentally friendly merchandise
social/natural trends impact marketing: greener consumers - affects firms 2 points
1) For companies selling environmentally friendly products, green marketing trend represents an opportunity
2) firms that sell products harmful to environment may consider it a threat and must innovate to stay in business
social/natural trends impact marketing: privacy concerns example
Firms need to ensure customer data is safe
social/natural trends impact marketing: time poor society - 4 ways this affects marketers
1) Reaching a target market is difficult since it’s hard to catch the market’s attention as they are very busy (both parents may work)
2) Consumers can skip through commercials and miss messages from marketers
3) Consumers may multi-task so they won’t focus on advertisements well
4) Marketers have to change marketing ideas like moving from tv ads to social media and offering online stores
social/natural trends impact marketing: health and wellness concerns - 2 ways this affects marketers
1) There are advertising guidelines concerning food, like marketing food in reasonable proportion size
2) There are new markets focused on healthy living like yoga studios and gyms
