Environmental scanning - Lecture 2 Flashcards
environmental scanning d
collection and evaluation of information from the wider marketing environment that might affect the organisation and its strategic marketing activities
macro-environment d
major, uncontrollable, external forces which influence firm’s decision making and have an impact upon its performance
micro-environment d
factors or elements in firm’s immediate environment which affect performance and decision making
what is demographics
demographics is the study of measurable aspects of the population, such as age, gender, race, occupation and location
what is the grey market
over 55
what does cultural environment refer to
the shared set of beliefs and behaviours prevalent within the society in which an organisation operates
what does PEST stand for
political,
economic,
sociocultural,
tehcnological
what political factors can affect marketing
government regulations and legal issues and define both formal and informal rules under which the organisation must operate
how do economic factors affect marketing
affect purchasing power of potential customers and the organisation’s cost of capital (for example: economic growth, interest rates)
what can technological factors do (pest)
can lower barriers to entry,
reduce minimum efficient production levels,
influence outsourcing decisions
SWOT analysis
strenghts,
weaknesses,
opportunities,
threats
what do the strengths and weaknesses in swot analysis represent
the organisations resources and capabilities that can be used to develop a competitive advantage
example of strengths that give a company a competitive advantage
patents, strong brand name, good reputation among customers, exclusive access to natural resources, prices
what do opportunities in swot analysis represent
external environmental analysis may reveal new opportunities for profit and growth
what does threats represent in swot analysis
changes in external environment may represent threats to the organisation
what is an example of threats to a company (swot analysis)
change in tastes,
substitute product,
new regulation,
increase trade barriers
monopoly d
single producer facing a large number of buyers dominates the market
monopsony d
single buyer facing a large number of sellers dominates the market
example of a monopsony
supermarkets when they go to dairy farms and dictate the price even though they are the buyer
oligopoly d
situation where the number of competitors is low or a few firms are dominant
monopolistic competition d
there are many competitors whose market powers are evenly distributed
examples of monopolistic competition
fast food companies,
clothing stores
perfect competition d
the existence in the market of a large number of sellers facing a large number of buyers
what does PEST analyse *
PEST analyses the industry not the company or product
what is the difference between the macro-environment and the micro-environment
macro includes all factors that can influence an organisation but that are out of their control
what does the micro environment mean
factors that influence the organisation directly such as suppliers, competitors, stakeholders, customers
what are some example political factors that might affect a company (PEST)
tax policy,
employment laws,
environmental regulations,
trade restrictions
what are organisations also subject to as part of P in pest
organisations are also subject to rules passed by regulatory bodies such as trade associations codes of conduct for example (British medical association)
what is the aim of legislation affecting organisations
protect companies from each other (competition laws),
protect consumers from unfair business practices,
protect interest of society against uncontrolled business behaviour
what are examples of economic factors that might affect an organisation (pest)
economic growth,
interest rates,
exchange rates,
inflation rates
why do marketers need to be aware of economic trends (PEST)
economic environment consists of factors that affect consumer purchasing power and spending patterns
why is it important for organisations to understand socio-cultural trends (pest)
important to understand level of disposable income and the choices households make about spending or saving,
changing tastes also influence demand,
witnessing a shift towards env/social issues which influence spending patterns
what does SWOT analyse
company and product
what are some examples of technological factors (pest)
R&D activity,
automation,
technological incentives,
rate of technological change
what are the two places technological advance can generate from, as far as the marketer is concerned
external to the org (technology developed for other purposes that may have spin off commercial benefits),
internal to the org (driven by the org searching for specific solutions to specific market problems)
example of pest analysis for bp *
p - trade policies or regulation due to market power,
e - exchange rates affecting imports,
s - way the world views sustainability affecting operations,
t - amount of R&D by other companies into new ways of producing energy etc
example of pest analysis for university * (don’t use cause her example but useful to know more factors)
P/broadening of EU,
E/fees,
S/%foreign/mature students,
T/plagiarism software, e-libraries
what do strengths and weaknesses tend to focus on
strengths and weaknesses tend to focus on the present and past and on internally focused factors
in swot analysis what can an absence of certain strengths be viewed as
a weakness
what do opportunities and threats tend to focus on
opportunities and threats tend to focus on the present and the future taking a more outward looking strategic view
what are examples of opportunities (swot)
unfulfilled customer need,
arrival of new technologies,
loosening of regulation,
removal of international trade barriers
example of monopoly
train companies who are the only ones who do certain routes
example of oligopoly
oil companies like bp and shell who tell petrol
