Chapter 3 - Analyzing Marketing Environment

Question 1

what results from analyzing marketing environment and give an example

Answer 1

1) means firms can adapt product offerings to meet new challenges and opportunities
2) Example: plastic bags and shift to reusable

Question 2

what do we analyze and assess?

Answer 2

1) industry and competition
2) macroenvironment (context) and micoenvironment
3) firm’s offer (internal company analysis)

Question 3

explain the marketing environment diagram

Answer 3

1) consumer in center who is influenced by microenvironment

2) the microenvironment and indirectly the consumer are influenced by macroenvironment

Question 4

3 things included in micoenvironment

Answer 4

1) company capabilities
2) corporate partners
3) competition

Question 5

things included in macroenvironment

Answer 5

1) culture
2) demographics
3) social/natural
4) tech
5) economic
6) political/legal

Question 6

strategy vs tactic

Answer 6

strategy - overarching plan or set of goals

tactic - specific actions or steps you take to accomplish strategy

Question 7

microenvironment factors: explain company capabilities - 2 points

Answer 7

1) Successful marketing efforts focus on satisfying customers needs that match their core competencies
2) firm level and offer level

Question 8

microenvironment factors: company capabilities at firm level

Answer 8

Assess organization’s marketing health like financial resources, HR, physical resources, soft resources (software, systems), your market offer

Question 9

microenvironment factors: company capabilities at offer level

Answer 9

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

Question 10

microenvironment factors: competition:

Answer 10

1) More competition means more choices which influences buying decisions
2) Firms must understand competition SWOT

Question 11

microenvironment factors: competition: define competitive intelligence - 2 points and an example

Answer 11

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

Question 12

microenvironment factors: competition: 5 questions to ask

Answer 12

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

Question 13

microenvironment factors: competition: 5 things to use to compare firm to competition

Answer 13

1) product quality
2) reputation with dealers
3) customer satisfaction
4) innovativeness
5) after-sales support

Question 14

microenvironment factors: define corporate partners - 3 points

Answer 14

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

Question 15

define macroenvironmental factors

Answer 15

aspects of the external environment (CDSTEP) that affect companies

Question 16

macroenvironmental factors: culture - 3 points

Answer 16

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

Question 17

macroenvironmental factors: 2 dimensions of culture

Answer 17

1) country culture

2) regional subculture

Question 18

macroenvironmental factors: define country culture

Answer 18

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

Question 19

macroenvironmental factors: example of regional subculture

Answer 19

Quebec vs ontario residents shop differently

Question 20

macroenvironmental factors: define demographics

Answer 20

Characteristics of human populations and segments, especially those used to identify consumer markets

Question 21

macroenvironmental factors: 5 types of demographics

Answer 21

1) generational cohorts
2) income
3) education
4) gender
5) ethnicity

Question 22

macroenvironmental factors: generational cohorts - 2 points

Answer 22

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

Question 23

macroenvironmental factors: how can we use education for demographics

Answer 23

High school students spend money different than university students

Question 24

macroenvironmental factors: how can we use gender for demographics - 2 points

Answer 24

1) Women make the majority of purchase decisions

2) More firms are being careful about gender neutrality in positioning their products

Question 25

macroenvironmental factors: how can we use ethnicity for demographics - 2 points

Answer 25

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

Question 26

macroenvironmental factors: explain tech advances - 2 points

Answer 26

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)

Question 27

macroenvironmental factors: define economic situation

Answer 27

Economic changes that affect the way consumers buy merchandise and spend money

Question 28

macroenvironmental factors: 4 factors in economic situation

Answer 28

1) rate of inflation
2) foreign exchange rate
3) interest rates
4) recession

Question 29

macroenvironmental factors: explain inflation - 2 points

Answer 29

1) define: persistent increase in prices of goods

2) causes purchasing power to decline

Question 30

macroenvironmental factors: explain foreign exchange rate - 2 points

Answer 30

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

Question 31

macroenvironmental factors: explain interest rates - 2 points

Answer 31

1) define: cost of borrowing money

2) If interest rates rise, consumers have incentive to save more

Question 32

macroenvironmental factors: define recession

Answer 32

period of economic downturn when economic growth of country is negative for at least 2 consecutive quarters

Question 33

macroenvironmental factors: consumer behaviour in recession

Answer 33

Consumers postpone big-ticket purchases and look for deals

Question 34

macroenvironmental factors: what does political/legal environment comprise

Answer 34

Comprises political parties, gov organizations, legislations and laws that promote or inhibit trade and marketing activities

Question 35

macroenvironmental factors: how does political/legal environment affect firm - 4 points

Answer 35

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

Question 36

social/natural trends impact marketing: 5 trends in social/natural trends?

Answer 36

1) greener consumers
2) marketing to children
3) privacy concerns
4) time-poor society
5) health and wellness concerns

Question 37

social/natural trends impact marketing: greener consumers: define green marketing

Answer 37

strategic effort by firms to supply customers with environmentally friendly merchandise

Question 38

social/natural trends impact marketing: greener consumers - affects firms 2 points

Answer 38

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

Question 39

social/natural trends impact marketing: privacy concerns example

Answer 39

Firms need to ensure customer data is safe

Question 40

social/natural trends impact marketing: time poor society - 4 ways this affects marketers

Answer 40

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

Question 41

social/natural trends impact marketing: health and wellness concerns - 2 ways this affects marketers

Answer 41

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