TheMarketingEnvironment3PrinciplesofMarketingThe3PrinciplesofMarketing1

TheMarketingEnvironmentThemarketingenvironmentincludestheactorsandforcesoutsidemarketingthataffectmarketingmanagement’sabilitytobuildandmaintainsuccessfulrelationshipswithcustomers3-4

TheMarketingEnvironment3-42TheMarketingEnvironmentMarketingEnvironmentMicroenvironmentconsistsoftheactorsclosetothecompanythataffectitsabilitytoserveitscustomers,thecompany,suppliers,marketingintermediaries,customermarkets,competitors,andpublics3-5TheMarketingEnvironmentMarke3

TheCompany’sMicroenvironmentMarketingEnvironmentMacroenvironmentconsistsofthelargersocietalforcesthataffectthemicroenvironmentDemographicEconomicNaturalTechnologicalPoliticalCultural3-6

TheCompany’sMicroenvironmen4

TheCompany’sMicroenvironmentTheCompanySuppliersMarketingintermediariesCustomersCompetitorsPublics3-7

TheCompany’sMicroenvironmen5TheCompany’sMicroenvironmentTheCompanyInternalenvironmentincludes:TopmanagementFinanceR&DPurchasingOperationsAccounting3-8TheCompany’sMicroenvironment6

TheCompany’sMicroenvironmentSuppliersProvidetheresourcestoproducegoodsandservicesTreatedaspartnerstoprovidecustomervalue3-9

TheCompany’sMicroenvironmen7

TheCompany’sMicroenvironmentHelpthecompanytopromote,sell,anddistributeitsproductstofinalbuyersInclude:ResellersPhysicaldistributionfirmsMarketingservicesagenciesFinancialintermediaries3-10MarketingIntermediaries

TheCompany’sMicroenvironmen8

TheCompany’sMicroenvironmentMarketingIntermediariesResellersarethedistributionchannelfirmsthathelpthecompanyfindcustomersormakesalestothemInclude:WholesalersRetailers3-11

TheCompany’sMicroenvironmen9TheCompany’sMicroenvironmentMarketingIntermediariesPhysicaldistributionfirmsarethedistributionchannelfirmsthathelpthecompanytostockandmovegoodsfromtheirpointsoforigintotheirfinaldestination3-12TheCompany’sMicroenvironment10

TheCompany’sMicroenvironmentMarketingIntermediariesMarketingserviceagenciesarethemarketingresearchfirms,advertisingagencies,mediafirms,andmarketingconsultingfirmsthathelpthecompanytargetandpromoteitsproductstotherightmarkets3-13

TheCompany’sMicroenvironmen11

TheCompany’sMicroenvironmentMarketingIntermediariesFinancialintermediariesincludebanks,creditcompanies,insurancecompanies,andotherbusinessesthathelpfinancetransactionsorinsureagainsttherisksassociatedwiththebuyingandsellingofgoods3-14

TheCompany’sMicroenvironmen12

TheCompany’sMicroenvironmentCustomersCustomermarketsconsistofindividualsandhouseholdsthatbuygoodsandservicesforpersonalconsumptionBusinessmarketsbuygoodsandservicesforfurtherprocessingorforuseintheirproductionprocess3-15

TheCompany’sMicroenvironmen13

TheCompany’sMicroenvironmentCustomersResellermarketsbuygoodsandservicestoresellataprofitGovernmentmarketsbuygoodsandservicestoproducepublicservicesortransfergoodsandservicestootherswhoneedthemInternationalmarketsconsistofbuyersinothercountriesincludingconsumers,producers,resellers,andgovernments3-16

TheCompany’sMicroenvironmen14

TheCompany’sMicroenvironmentCompetitorsFirmsmustgainstrategicadvantagebypositioningtheirofferingsagainstcompetitors’offerings3-17

TheCompany’sMicroenvironmen15

TheCompany’sMicroenvironmentPublicsFinancialpublicsinfluencethecompany’sabilitytoobtainfunds—banks,investmenthouses,andstockholdersMediapublicscarrynews,features,andeditorialopinion—newspapers,magazines,andradioandtelevisionstationsGovernmentpublicsinfluenceproductsafetyandtruthinadvertising3-19

TheCompany’sMicroenvironmen16TheCompany’sMicroenvironmentPublicsCitizen-actionpublicsincludeconsumerorganizations,environmentgroups,andminoritygroupsLocalpublicsincludeneighborhoodresidentsandcommunityorganizationsGeneralpublicsinfluencethecompany’spublicimageInternalpublicsincludeworkers,managers,volunteers,anddirectors3-20TheCompany’sMicroenvironment17TheCompany’sMacroenvironmentDemographicEnvironmentDemographyisthestudyofhumanpopulationsintermsofsize,density,location,age,gender,race,occupation,andotherstatisticsDemographicenvironmentisimportantbecauseitinvolvespeople,andpeoplemakeupmarketsDemographictrendsincludeage,familystructure,geographicpopulationshifts,educationalcharacteristics,andpopulationdiversity3-22TheCompany’sMacroenvironment18

TheCompany’sMacroenvironmentDemographicEnvironmentChangingAgeStructureofthePopulationGenerationalmarketingisimportantinsegmentingpeoplebylifestyleoflifestateinsteadofage3-23

TheCompany’sMacroenvironmen19TheCompany’sMacroenvironmentBabyboomersincludepeoplebornbetween1946and1964MostaffluentAmericans3-24DemographicEnvironmentChangingAgeStructureofthePopulationTheCompany’sMacroenvironment20

TheCompany’sMacroenvironmentDemographicEnvironmentChangingAgeStructureofthePopulationGenerationXincludespeoplebornbetween1965and1976HighdivorceratesConcernedabouttheenvironmentRespondtosociallyresponsiblecompaniesLessmaterialisticQualityoflifeConsumerorganizations,environmentgroups,andminoritygroups3-25

TheCompany’sMacroenvironmen21

TheCompany’sMacroenvironmentGenerationYincludespeoplebornbetween1977and2000Internetgeneration3-26DemographicEnvironmentChangingAgeStructureofthePopulation

TheCompany’sMacroenvironmen22TheCompany’sMacroenvironmentDemographicEnvironmentTheChangingAmericanFamilyMorepeopleare:DivorcingorseparatingChoosingnottomarryChoosingtomarryinglaterMarryingwithoutintendingtohavechildrenHigherdivorceratesIncreasednumberofworkingwomenStay-at-homedads3-27TheCompany’sMacroenvironment23TheCompany’sMacroenvironmentTrendsinclude:MigratorymovementsbetweenandwithincountriesMovingfromruraltometropolitanareasChangesinwherepeopleworkTelecommutingHomeofficeDivorcingorseparating3-28DemographicEnvironmentGeographicShiftsinPopulationTheCompany’sMacroenvironment24TheCompany’sMacroenvironmentDemographicEnvironmentIncreasingDiversityMarketsarebecomingmorediverseInternationalNationalTrendsInclude:EthnicityGayandlesbianDisabled3-30TheCompany’sMacroenvironment25TheCompany’sMacroenvironmentEconomicEnvironmentChangesinIncomeIncomedistributionUpper-classconsumersMiddle-classconsumersWorking-classconsumersUnderclassconsumers3-33TheCompany’sMacroenvironment26

TheCompany’sMacroenvironmentNaturalEnvironmentNaturalenvironmentinvolvesthenaturalresourcesthatareneededasinputsbymarketersorthatareaffectedbymarketingactivitiesTrendsShortagesofrawmaterialsIncreasedpollutionIncreasedgovernmentinterventionEnvironmentallysustainablestrategiesGreenmarketing3-35

TheCompany’sMacroenvironmen27

TheCompany’sMacroenvironmentPoliticalEnvironmentPoliticalenvironmentconsistsoflaws,governmentagencies,andpressuregroupsthatinfluenceorlimitvariousorganizationsandindividualsinagivensociety3-38

TheCompany’sMacroenvironmen28

TheCompany’sMacroenvironmentPoliticalEnvironmentLegislationregulatingbusinessPublicpolicytoguidecommerce—setsoflawsandregulationsthatlimitbusinessforthegoodofsocietyatlargeIncreasinglegislationProtectcompaniesProtectconsumersProtecttheinterestsofsociety3-39

TheCompany’sMacroenvironmen29TheCompany’sMacroenvironmentPoliticalEnvironmentIncreasedEmphasisonEthicsandSociallyResponsibleActionsSociallyresponsiblebehavioroccurswhenfirmsactivelyseekoutwaystoprotectthelong-terminterestsoftheirconsumersandtheenvironmentCause-relatedmarketing3-41TheCompany’sMacroenvironment30TheCompany’sMacroenvironmentCulturalEnvironmentCulturalenvironmentconsistsofinstitutionsandotherforcesthataffectasociety’sbasicvalues,perceptions,andbehaviors3-42TheCompany’sMacroenvironment31

TheCompany’sMacroenvironmentCulturalEnvironmentPersistenceofCulturalValuesCorebeliefsandvalueshaveahighdegreeofpersistence,arepassedonfromparentstochildren,andarereinforcedbyschools,churches,businesses,andgovernmentSecondarybeliefsandvaluesaremoreopentochange3-43

TheCompany’sMacroenvironmen32

TheCompany’sMacroenvironmentCulturalEnvironmentShiftsinSecondaryCulturalValuesMajorculturalvaluesofasocietyareexpressedinpeople’sviewof:ThemselvesOthersOrganizationSocietyNatureandtheuniverse3-44

TheCompany’sMacroenvironmen33TheCompany’sMicroenvironmentCulturalEnvironmentShiftsinSecondaryCulturalValuesPeople’sviewofthemselvesYankelovichMonitor’sconsumersegments:Do-It-Yourselfers—recentmoversAdventurersPeople’sviewofothers3-45TheCompany’sMicroenvironment34TheCompany’sMacroenvironmentCulturalEnvironmentShiftsinSecondaryCulturalValuesPeople’sviewoforganizationsPeople’sviewofsocietyPatriotsdefenditReformerswanttochangeitMalcontentswanttoleaveit3-46TheCompany’sMacroenvironment35

TheCompany’sMacroenvironmentCulturalEnvironmentShiftsinSecondaryCulturalValuesPeople’sviewofnatureSomefeelruledbyitSomefeelinharmonywithitSomeseektomasteritPeople’sviewoftheuniverseRenewedinterestinspirituality3-47

TheCompany’sMacroenvironmen36TheMarketingEnvironment3PrinciplesofMarketingThe3PrinciplesofMarketing37

TheMarketingEnvironmentThemarketingenvironmentincludestheactorsandforcesoutsidemarketingthataffectmarketingmanagement’sabilitytobuildandmaintainsuccessfulrelationshipswithcustomers3-4

TheMarketingEnvironment3-438TheMarketingEnvironmentMarketingEnvironmentMicroenvironmentconsistsoftheactorsclosetothecompanythataffectitsabilitytoserveitscustomers,thecompany,suppliers,marketingintermediaries,customermarkets,competitors,andpublics3-5TheMarketingEnvironmentMarke39

TheCompany’sMicroenvironmentMarketingEnvironmentMacroenvironmentconsistsofthelargersocietalforcesthataffectthemicroenvironmentDemographicEconomicNaturalTechnologicalPoliticalCultural3-6

TheCompany’sMicroenvironmen40

TheCompany’sMicroenvironmentTheCompanySuppliersMarketingintermediariesCustomersCompetitorsPublics3-7

TheCompany’sMicroenvironmen41TheCompany’sMicroenvironmentTheCompanyInternalenvironmentincludes:TopmanagementFinanceR&DPurchasingOperationsAccounting3-8TheCompany’sMicroenvironment42

TheCompany’sMicroenvironmentSuppliersProvidetheresourcestoproducegoodsandservicesTreatedaspartnerstoprovidecustomervalue3-9

TheCompany’sMicroenvironmen43

TheCompany’sMicroenvironmentHelpthecompanytopromote,sell,anddistributeitsproductstofinalbuyersInclude:ResellersPhysicaldistributionfirmsMarketingservicesagenciesFinancialintermediaries3-10MarketingIntermediaries

TheCompany’sMicroenvironmen44

TheCompany’sMicroenvironmentMarketingIntermediariesResellersarethedistributionchannelfirmsthathelpthecompanyfindcustomersormakesalestothemInclude:WholesalersRetailers3-11

TheCompany’sMicroenvironmen45TheCompany’sMicroenvironmentMarketingIntermediariesPhysicaldistributionfirmsarethedistributionchannelfirmsthathelpthecompanytostockandmovegoodsfromtheirpointsoforigintotheirfinaldestination3-12TheCompany’sMicroenvironment46

TheCompany’sMicroenvironmentMarketingIntermediariesMarketingserviceagenciesarethemarketingresearchfirms,advertisingagencies,mediafirms,andmarketingconsultingfirmsthathelpthecompanytargetandpromoteitsproductstotherightmarkets3-13

TheCompany’sMicroenvironmen47

TheCompany’sMicroenvironmentMarketingIntermediariesFinancialintermediariesincludebanks,creditcompanies,insurancecompanies,andotherbusinessesthathelpfinancetransactionsorinsureagainsttherisksassociatedwiththebuyingandsellingofgoods3-14

TheCompany’sMicroenvironmen48

TheCompany’sMicroenvironmentCustomersCustomermarketsconsistofindividualsandhouseholdsthatbuygoodsandservicesforpersonalconsumptionBusinessmarketsbuygoodsandservicesforfurtherprocessingorforuseintheirproductionprocess3-15

TheCompany’sMicroenvironmen49

TheCompany’sMicroenvironmentCustomersResellermarketsbuygoodsandservicestoresellataprofitGovernmentmarketsbuygoodsandservicestoproducepublicservicesortransfergoodsandservicestootherswhoneedthemInternationalmarketsconsistofbuyersinothercountriesincludingconsumers,producers,resellers,andgovernments3-16

TheCompany’sMicroenvironmen50

TheCompany’sMicroenvironmentCompetitorsFirmsmustgainstrategicadvantagebypositioningtheirofferingsagainstcompetitors’offerings3-17

TheCompany’sMicroenvironmen51

TheCompany’sMicroenvironmentPublicsFinancialpublicsinfluencethecompany’sabilitytoobtainfunds—banks,investmenthouses,andstockholdersMediapublicscarrynews,features,andeditorialopinion—newspapers,magazines,andradioandtelevisionstationsGovernmentpublicsinfluenceproductsafetyandtruthinadvertising3-19

TheCompany’sMicroenvironmen52TheCompany’sMicroenvironmentPublicsCitizen-actionpublicsincludeconsumerorganizations,environmentgroups,andminoritygroupsLocalpublicsincludeneighborhoodresidentsandcommunityorganizationsGeneralpublicsinfluencethecompany’spublicimageInternalpublicsincludeworkers,managers,volunteers,anddirectors3-20TheCompany’sMicroenvironment53TheCompany’sMacroenvironmentDemographicEnvironmentDemographyisthestudyofhumanpopulationsintermsofsize,density,location,age,gender,race,occupation,andotherstatisticsDemographicenvironmentisimportantbecauseitinvolvespeople,andpeoplemakeupmarketsDemographictrendsincludeage,familystructure,geographicpopulationshifts,educationalcharacteristics,andpopulationdiversity3-22TheCompany’sMacroenvironment54

TheCompany’sMacroenvironmentDemographicEnvironmentChangingAgeStructureofthePopulationGenerationalmarketingisimportantinsegmentingpeoplebylifestyleoflifestateinsteadofage3-23

TheCompany’sMacroenvironmen55TheCompany’sMacroenvironmentBabyboomersincludepeoplebornbetween1946and1964MostaffluentAmericans3-24DemographicEnvironmentChangingAgeStructureofthePopulationTheCompany’sMacroenvironment56

TheCompany’sMacroenvironmentDemographicEnvironmentChangingAgeStructureofthePopulationGenerationXincludespeoplebornbetween1965and1976HighdivorceratesConcernedabouttheenvironmentRespondtosociallyresponsiblecompaniesLessmaterialisticQualityoflifeConsumerorganizations,environmentgroups,andminoritygroups3-25

TheCompany’sMacroenvironmen57

TheCompany’sMacroenvironmentGenerationYincludespeoplebornbetween1977and2000Internetgeneration3-26DemographicEnvironmentChangingAgeStructureofthePopulation

TheCompany’sMacroenvironmen58TheCompany’sMacroenvironmentDemographicEnvironmentTheChangingAmericanFamilyMorepeopleare:DivorcingorseparatingChoosingnottomarryChoosingtomarryinglaterMarryingwithoutintendingtohavechildrenHigherdivorceratesIncreasednumberofworkingwomenStay-at-homedads3-27TheCompany’sMacroenvironment59TheCompany’sMacroenvironmentTrendsinclude:MigratorymovementsbetweenandwithincountriesMovingfromruraltometropolitanareasChangesinwherepeopleworkTelecommutingHomeofficeDivorcingorseparating3-28DemographicEnvironmentGeographicShiftsinPopulationTheCompany’sMacroenvironment60TheCompany’sMacroenvironmentDemographicEnvironmentIncreasingDiversityMarketsarebecomingmorediverseInternationalNationalTrendsInclude:EthnicityGayandlesbianDisabled3-30TheCompany’sMacroenvironment61TheCompany’sMacroenvironmentEconomicEnvironmentChangesinIncomeIncomedistributionUpper-classconsumersMiddle-classconsumersWorking-classconsumersUnderclassconsumers3-33TheCompany’sMacroenvironment62

TheCompany’sMacroenvironmentNaturalEnvironmentNaturalenvironmentinvolvesthenaturalresourcesthatareneededasinputsbymarketersorthatareaffectedbymarketingactivitiesTrendsShortagesofrawmaterialsIncreasedpollutionIncreasedgovernmentinterventionEnvironmentallysustainablestrategiesGreenmarketing3-35

TheCompany’sMacroenvironmen63

TheCompany’sMacroenvironmentPoliticalEnvironmentPoliticalenvironmentconsistsoflaws,governmentagencies,andpressuregroupsthatinfluenceorlimitvariousorganizationsandindividualsinagivensociety3-38

TheCompany’sMacroenvironmen64

TheCompany’sMacroenvironmentPoliticalEnvironmentLegislationregulatingbusinessPublicpolicytoguidecommerce—setsoflawsandregulationsthatlimitbusinessforthegoodofsocietyatlargeIncreasinglegislationProtectcompaniesProtectconsumersProtecttheinterestsofsociety3-39

TheCompany’sMacroenvironm