Chapter 3: The Global Enviroment Flashcards
Marketing Environment consists of what…
The marketing environment consists of outside factors that impact a companies ability to reach marketing goals.
What are considered forces in the marketing environment?
Political, economic, demographic, sociocultural, technological.
Direct Competition
Direct competition occurs when similar products compete against each other.
Substitute Products
Substitute Products are goods and services that can be used in place of each other.
Indirect Competition
Indirect competition occurs when products provide alternative solutions to the same market.
Environmental Scanning
The process of monitoring developments outside of the firm.
What factors influence a firms marketing environment?
Factors include economic, demographic, sociocultural, political, legal, and technological.
Gross Domestic Product (Economic Factor)
GDP is the market value of all official final goods and services produced in a country
What does the GDP measure?
size and health of an economy
GDP per capita
Indicates the country’s standard of living
Recession
Occurs when the GDP declines for two or more quarters back to back
What does a recession cause?
A recession can cause layoffs, unemployment spikes, and reduced consumer confidence
Inflation
Inflation is the increase in general level of a products price over a period of time
Purchasing Power
Purchasing Power is the amount of goods and services that can be bought for a specific amount
Consumer Confidence
A measure of how optimistic consumers are about the economy and their own finances
Demographics
Human characteristics such as age, gender, ethnicity, and education.
Sociocultural Factors
Sociocultural factors are social and cultural factors that impact human development
PACs
PACs are committees that raise money to help elect individuals who support their issue(s).
Why do governmental bodies regulate businesses?
Governmental bodies regulate businesses so that they compete fairly and don’t take advantage of their customers.
Sherman Antitrust Act (1890)
Eliminated monopolies and encouraged competition
Robinson-Patman Act (1936)
Simplified prohibitions on selling the same product at different prices
Wheeler-Lea Act (1938)
Prohibited deceptive and misleading adverts
Federal Trade Commission (FTC)
Investigates complaints made about organizations
Fair Packaging and Labeling Act (1966)
Guarantees that packages are correctly labeled
The Telephone Consumer Protection Act of 1991
Reduced the use of telemarketing
Credit Card Accountability, Responsibility, and Disclosure Act of 2009 (CARD)
Banned unfair credit rate increases & requires disclosures about min payments and interest rates be made in plain english.
Currency Fluctuation
Currency Fluctuation is how the value of a currency is changed in relation to another.
Currency Exchange Rate
The currency exchange rate is the price of once country’s currency in terms of another.
North American Free Trade Agreement (NAFTA)
NAFTA established a free-trade zone within the U.S, Canada, and Mexico
What was the goal of NAFTA?
NAFTA’s goal was to eliminate trade barriers between the U.S, Canada, and Mexico
Tariffs
Tariffs are taxes on imported and exported goods
United States-Mexico-Canada Agreement
USMCA
What was is the goal of USMCA?
USMCA had several goals including having car and truck parts made in North America, upgrading environment & labor regulation, and stricter protections for patents and trademarks.
Dominican Republic-Central American Free Trade Agreement (DR-CAFTA)
DR-CAFTA’s goals are to eliminate tariffs, reduce non-tariff barriers, and facilitating investment amongst the states.
European Union (EU)
The EU was formed to create a european market by reducing barriers to the free trade of goods services and financies among its members.
World Trade Organization (WTO)
Regulates members trade, and helps importers and exporters.
International Monetary Fund (IMF)
The IMFs goal is to promote economic cooperation, trade, employment, and exchange rate stability worldwide
Consumer Ethnocentrism
Ethnocentrism is the belief that it is immoral to buy foreign goods and services
How are nonprofits funded?
Grants, special events, and donations.
