Chapter Three

Analyzing the Marketing Environment

Chapter 3- slide 1
 Analyzing the Marketing
Environment
Topic Outline

• The Company’s Microenvironment

• The Company’s Macroenvironment
• Responding to the Marketing Environment

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Chapter 3- slide 2
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 The Marketing Environment

The marketing environment includes the

actors and forces outside marketing that
affect marketing management’s ability to
build and maintain successful relationships
with customers

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Chapter 3- slide 3
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 The Marketing Environment

Microenvironment consists of the actors

close to the company that affect its ability
to serve its customers, the company,
suppliers, marketing intermediaries,
customer markets, competitors, and publics

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Chapter 3- slide 4
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 The Company’s
Microenvironment
Actors in the Microenvironment

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Chapter 3- slide 5
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 The Company’s
Microenvironment
The Company
• Top management
• Finance
• R&D
• Purchasing
• Operations
• Accounting

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Chapter 3- slide 6
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 The Company’s
Microenvironment
Suppliers
• Provide the resources to produce goods
and services
• Treated as partners to provide customer
value

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Chapter 3- slide 7
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 The Company’s
Microenvironment
Marketing Intermediaries

Help the company

to promote, sell and
distribute its
products to final
buyers

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Chapter 3- slide 8
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 The Company’s
Microenvironment
Types of Marketing Intermediaries

Physical
Resellers distribution
firms

Marketing
Financial
services
intermediaries
agencies
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Chapter 3- slide 9
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 The Company’s
Microenvironment
Competitors
• Firms must gain strategic advantage by
positioning their offerings against
competitors’ offerings

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Chapter 3- slide 10
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 The Company’s
Microenvironment
Publics
• Any group that has an actual or potential interest in or
impact on an organization’s ability to achieve its
objectives
– Financial publics
– Media publics
– Government publics
– Citizen-action public
– General public
– Local publics
– Internal publics

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Chapter 3- slide 11
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 The Company’s
Macroenvironment

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Chapter 3- slide 12
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 The Company’s
Macroenvironment
Demographic Environment
Demography is the study of human populations
in terms of size, density, location, age, gender,
race, occupation, and other statistics
• Demographic environment is important
because it involves people, and people make
up markets
• Demographic trends include age, family
structure, geographic population shifts,
educational characteristics, and population
diversity
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Chapter 3- slide 13
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 The Company’s
Macroenvironment
Demographic Environment
• Increasing population
– Rapid growth in urban population in Asia
– In India, urban population to rise to 523 million
by 2025

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Chapter 3- slide 14
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 The Company’s
Macroenvironment
Demographic Environment
• A growing middle class
– Indian population is divided into 5 economic
classes
– Division based on real annual disposable
income

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Chapter 3- slide 15
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 The Company’s
Macroenvironment
Demographic Environment
• Deprived households have an annual
disposable income of less than Rs 90,000
– The poorest economic class
– Mostly unskilled or semi-skilled workers on
daily wages

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Chapter 3- slide 16
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 The Company’s
Macroenvironment
Demographic Environment
• Aspirers have an annual disposable
income in the range of Rs 90,000 to Rs
200,000
– Spend most of their income on basic
necessities
– Small-time retailers, small farmers, etc.

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Chapter 3- slide 17
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 The Company’s
Macroenvironment
Demographic Environment
• Seekers have an annual disposable income
between Rs 200,000 and Rs 500,000.
Mostly white-collar employees, mid-level
government officials, newly employed
postgraduates, medium-scale traders

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Chapter 3- slide 18
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 The Company’s
Macroenvironment
Demographic Environment
• Strivers have an annual income ranging
from Rs 500,000 to Rs 1,000,000
– Have a stable income source and access to
amenities
– Mostly professionals such as lawyers, CAs,
senior government officials, rich farmers

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Chapter 3- slide 19
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 The Company’s
Macroenvironment
Demographic Environment

• Global Indians have an annual disposable

income in excess of Rs 1,000,000
– Creamy layer in society
– Globe-trotters with a high standard of living

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Chapter 3- slide 20
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 The Company’s
Macroenvironment
Demographic Environment
• Growth in the rural population
• A changing family system
• The changing role of women
• Increasing diversity

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Chapter 3- slide 21
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 The Company’s
Macroenvironment
Economic Environment
Economic environment consists of factors
that affect consumer purchasing power and
spending patterns
• Industrial economies are richer markets
• Subsistence economies consume most of
their own agriculture and industrial output

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Chapter 3- slide 22
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 The Company’s
Macroenvironment
Economic Environment
• The global financial crisis of 2007–2009 has
affected the consumption and production
of many products

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Chapter 3- slide 23
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 The Company’s
Macroenvironment
Economic Environment
Changes in Consumer Spending Patterns
• As income rises:
– The percentage spent on food declines
– The percentage spent on housing remains
constant
– The percentage spent on savings increases

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Chapter 3- slide 24
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 The Company’s
Macroenvironment
Natural Environment
Natural environment involves the natural
resources that are needed as inputs by
marketers or that are affected by marketing
activities
• Trends
– Shortages of raw materials
– Increased pollution
– Increase government intervention
– Environmentally sustainable strategies
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Chapter 3- slide 25
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 The Company’s
Macroenvironment
Technological Environment
• Most dramatic force in changing the
marketplace
• Creates new products and
opportunities
• Safety of new product always a
concern

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Chapter 3- slide 26
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 The Company’s
Macroenvironment
Political Environment

Political environment consists of laws,

government agencies, and pressure groups
that influence or limit various organizations
and individuals in a given society

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Chapter 3- slide 27
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 The Company’s
Macroenvironment
Political Environment
• Legislation regulating business
– Increased legislation
– Changing government agency enforcement
– New forms of nontariff barriers in trade
• Increased emphasis on ethics
– Socially responsible behavior
– Cause-related marketing

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Chapter 3- slide 28
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 The Company’s
Macroenvironment
Cultural Environment

Cultural environment consists of

institutions and other forces that affect a
society’s basic values, perceptions, and
behaviors

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Chapter 3- slide 29
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 The Company’s
Macroenvironment
Cultural Environment
Persistence of Cultural Values

Core beliefs and values are persistent and are

passed on from parents to children and are
reinforced by schools, religious institutions,
businesses, and government
Secondary beliefs and values are more open to
change and include people’s views of
themselves, others, organization, society,
nature, and the universe
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Chapter 3- slide 30
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 Responding to the Marketing
Environment
Views on Responding

Uncont Proacti Reacti

rollable ve ve
●
Aggressive Watching
●
●
React and
actions to and reacting
adapt to
affect forces to forces in
forces in the
in the the
environment environment environment
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Chapter 3- slide 31
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