Week 11 Flashcards
The marketing environment
A company’s marketing environment consists of the actors and forces outside of marketing that affect marketing management’s ability to build and maintain successful relationships with target customers. Companies constantly watch and adapt to the changing environment.
The marketing environment is made up of:
The microenvironment and the macroenvironment
The company’s microenvironment
Marketing management’s job is to build relationships with customers by creating customer value and satisfaction.
Marketing success will require building relationships with
• other company departments • suppliers • marketing intermediaries • competitors • various publics and • customers
that combine to make up the company’s value delivery network.
Suppliers
Suppliers form an important link in the company’s overall customer value delivery system. They provide the resources needed by the company to produce its goods and services. Supplier problems can seriously affect marketing. Marketing managers must be attentive to supply availability and costs.
Marketing managers must be attentive to supply availability and costs.
–
Supply shortages or delays, labourstrikes and other events can cost sales in the short run and damage customer satisfaction in the long run.
–
Rising supply costs may force price increases that can harm the company’s sales volume.
Marketing intermediaries
Marketing intermediaries help the company to promote, sell and distribute its products to final buyers.
Marketing intermediaries include
– Resellers – physical distribution firms – marketing services agencies and – financial intermediaries.
Resellers
Resellers are distribution channel firms that help the company find customers or make sales to them.
Competitors
The marketing concept states that to be successful a company must provide greater customer value and satisfaction than its competitors do. Therefore, marketers must do more than simply adapt to the needs of target consumers. They also must gain strategic advantage by positioning their offerings strongly against competitors’ offerings in the minds of consumers.
Publics
A public is any group that has an actual or potential interest in or impact on an organisation’s ability to achieve its objectives.
There are seven types of publics:
– Financial – Media – Government – Citizen-action – Local – General and – Internal
Customers
The aim of the entire value delivery system is to serve target customers and create strong relationships with them. Customers are the most important actors in the company’s microenvironment.
The company might target any, or all, of five types of customer markets.
– Consumer markets – Business markets – Reseller markets – Government markets – International markets
The company macroenvironment includes
Demographic environment
Economic
Natural
Technological
Political
Cultural
Demographic environment
Demography is the study of human populations in terms of – Size – Density – Location – Age – Gender – Race – occupation and – other statistics.
The demographic environment is of major interest to marketers because it involves people, and people make up markets.
Generational marketing
The single most important demographic trend in Australasia is the changing age structure of the population. Due to the falling birthrates and longer life expectancies, the Australian and New Zealand populations are rapidly getting older.
The Changing family
The ‘traditional household’ consists of a husband, wife and children (and sometimes grandparents). Although two-parent families still make up a very large part of Australian families, this pattern is changing. Approximately 40 per cent of all family households have two parents living at home but, in the next 20 years, this is expected to fall slightly
Geographic shifts in population
This is a period of great migratory movements between and within countries. Australians, for example, are mobile people, with about 40 per cent of all Australian residents moving every five years.
Increasing diversity
Countries vary in their ethnic and racial makeup. The populations in both Australia and New Zealand are much more diverse, with nearly one in three people born overseas. In Australia, migrants from the United Kingdom make up the biggest group, but many people living in Australia who were born overseas are from New Zealand, China and India.
Economic environment
The economic environment consists of factors that affect consumer purchasing power and spending patterns. Economic factors can have a dramatic effect on consumer spending and buying behaviour.
Includes changes in income and changing consumer spending patterns
Changes in income
Marketers should pay attention to income distribution as well as to income levels. Over the past several decades, the rich have grown richer, the middle class has shrunk and the poor have remained poor.
Changing consumer spending patterns
consumers at different income levels have different spending patterns.
Natural environment
The natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities. At the most basic level, unexpected happenings in the physical environment –anything from weather to natural disasters –can affect companies and their marketing strategies.
Environmental sustainability
Environmental sustainability means meeting present needs without compromising the ability of future generations to meet their needs. Concern for the natural environment has spawned an environmental sustainability movement. Today, enlightened companies go beyond what government regulations dictate. They are developing strategies and practices that create a world economy that the planet can support indefinitely.
Technological environment
The technological environment is perhaps the most dramatic force now shaping our destiny. Technology has released such wonders as antibiotics, robotic surgery, miniaturised electronics, laptop computers and the internet. It also has released such horrors as nuclear missiles, chemical weapons and assault rifles.
