Environmental Analysis Flashcards
Macro Environment - PEST
Political, Economic, Socail, Technological factors
Political and Regulatory Issues Include
Politics and policies employee welfare intellectual property anti-trust tariffs
Regulations Impact on costs pollution control Red tape Constraint on marketing activities consumer privacy food label, FDA
Economic Factors
Most influential factors on company profits Economic conditions Government spending e.g. ,China Interest rate, taxes Unemployment rate Consumer spending Consumer confidence Wage growth Assets appreciation Australian consumption driven by property boom
Sociocultural Factors
Sociocultural factors are those social and cultural influences that cause changes in attitudes, beliefs, norms, customs, and lifestyles Affect what, where, how, when consumers buy Sociocultural trends Aging population Online shopping Social media addiction Health consciousness Experiential consumption
Stages of Competitor Analysis
Identification, Characteristics, Assessment, Capabilities, Response
Issues to Be Considered in a Situation Analysis
The internal environment
Review of current objectives, strategy, and performance
Availability of resources
Organizational culture and structure
The customer environment
Who are our current and potential customers?
What do customers do with our products?
When do customers select our products?
Why (and how) do customers select our products?
Why do potential customers not purchase our products?
The external environment Competition Economic growth and stability Political trends Legal and regulatory issues Technological advancements
Data and Information
Data is not the same as information
Data - Collection of numbers or facts that have the potential to provide information
Information - Data transformed or combined with other data in a manner that makes them useful to decision makers
Analyzing the Internal Environment
Involves a review of:
Current marketing objectives, strategy, and performance
Consistency of marketing goals with corporate goals
Reasons behind improving or declining performance
Current and anticipated organizational resources
Current state of organizational resources
Measures required to use resources more effectively
Current and anticipated cultural and structural issues
Positive and negative aspects of current and anticipated organizational structure
Internal politics or management challenges that may affect marketing activities
Analyzing the Customer Environment
Involves examining:
Firm’s current and potential customers
Prevailing needs of current and potential customers
Basic features of the firm’s and competitor’s products that meets customers’ needs
Anticipated changes in customer-needs
Analysis method
5W model - Who, what, where, when, and why
Analyzing the External Environment
Involves examining: Competitors Economic growth and stability Political trends Legal and regulatory issues Technological advancements
Basic Types of Competition
Brand competitors
Market products with similar features and benefits to the same customers at similar prices
Product competitors
Compete in the same product class, but with products that are different in features, benefits, and price
Generic competitors
Market very different products that solve the same problem or satisfy the same basic customer need
Total budget competitors
Compete for the limited financial resources of the same customers
Benefits of SWOT Analysis
Simplicity, Lower costs, Flexibility, Integration and synthesis, collaboration
Sources of Competitive Advantage
Relational advantages Legal advantages Organizational advantages Human resource advantages Product advantages Pricing advantages Promotion advantages Distribution advantages
Core Competencies Necessary for Competitive Advantage Strategies
Operational excellence - Walmart and Dell
Core competencies
Low cost operations and totally dependable product supply
Common attributes
Target a broad, heterogeneous market of price-sensitive buyers
Maintain a system to avoid waste and highly reward efficiency improvement
Product leadership - 3M and Pfizer
Core competencies
Basic research or rapid research interpretation
Excellent marketing skills
Common attributes
Target narrow, homogeneous market segments
Maintain organizational cultures characterized by decentralization, adaptability, entrepreneurship, creativity, and the expectation of learning from failure
Customer intimacy - Nordstrom and Amazon
Core competencies
Exceptional skills in discovering customer needs
Problem solving proficiency
trategy Canvas
Horizontal axis
Identifies factors that the industry currently competes with and what customers receive from existing product offerings
Vertical axis
Identifies offering level received by buyers for each factor
Value curve
Identifies the firm’s relative performance across its industry’s factors of competition
