Chapter Two: Strategic

Marketing Management
 Marketing
Environment
• The marketing environment consists of actors
and forces outside the organization that affect
management’s ability to build and maintain
relationships with target customers.
• It Comprised of actors and forces affecting
marketing management’s ability to develop and
maintain successful relationships with its target
customers.
• External Environment offers both
opportunities and threats.
• Internal Environment offers both strengths
and weaknesses.
• Marketing intelligence and research used
to collect information about the environment.
 Components of Marketing
Environment
• Includes the following.
1. Task (mediating environment)
- Actors close to the company that affect its
ability to serve its customers.
- Organisations and individuals who directly or
indirectly affect the activities of a company .
2. Macro environment: larger forces that affect the
microenvironment.
• Considered to be beyond the control of the organization.
• PEST Analysis, (Political-legal, economic, socio-cultural and
technological)
Components of Marketing
Environment
Demographic

Cultural Publics Economic

Suppliers

Company
Customers
Competitors
Political Natural
Intermediaries

Technological
Components of Task
Environment
1. Suppliers:
– Provide resources
needed to produce
goods and services.
– Important link in the
“value delivery
system.”
– Most marketers treat
suppliers like partners.
2. Marketing Intermediaries:
– Help the company to promote, sell, and
distribute its goods to final buyers.
– Partnering with Intermediaries
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries
 Marketing Intermediaries
• Resellers- Reselling goods and services at a profit.

• Physical distribution firms help the company stock

and move goods from their points of origin to their
destinations.

• Marketing services agencies are the marketing

research firms, advertising agencies, media firms, and
marketing consulting firms.

• Financial intermediaries include banks, credit

companies, insurance companies and other businesses
that help finance transactions or insure against
the risks associated with the buying and selling of
goods.
3. Customers:
– Five types of markets
that purchase a
company’s goods and
services
– A company might target
any or all Markets
 Consumer market
 Business market
 Reseller market
 Government market
 International market
 Consist of individuals and
 households that buy goods and
Consumer market services for personal
consumption.
 Buy goods and services for
Business market further processing or use in
their production processes

Buy goods and services to resell

 Reseller market at a profit.
Consist of government agencies that
buy goods and services to produce
 Government
public services or transfer the goods
market and services to others who need
them.
Consist of these buyers in other
 International countries, including customers,
producers, resellers, and
market governments
4. Competitors:
– Those who serve a target market with
products and services that are viewed
by consumers as being reasonable
substitutes.

– Company must gain strategic advantage

against these organizations.
 Competitors
• Marketers also must gain strategic advantage by
positioning their offerings strongly against
competitors’ offerings in the minds of consumers.

• Each firm should consider its own size and industry

position compared to those of its competitors.

V.
S
5. Publics:
– Group that has an interest in or impact
on an organization's ability to achieve its
Types of Publics
objectives.
 • Influences the company’s ability to obtain
Financi
funds
al • Banks, investment analysts, and stockholders
publics are the major financial publics.
• This group includes neighborhood residents
Local and community organizations.
• Large companies usually create departments
Publics
and programs that deal with local community
issues and provide community support.
• Carries news, features, and editorial
Media opinion.
publics • It includes newspapers, magazines, television
stations, and blogs and other Internet media.
• Management must take government
Govern developments into account.
ment • Marketers must often consult the company’s
Publics lawyers on issues of product safety, truth in
 • A company’s marketing decisions may be
questioned by consumer organizations,
Citizen- environmental groups, minority
action groups, and others.
• Its public relations department can help it
publics
stay in touch with consumer and citizen
groups.

This group includes workers, managers,

Internal volunteers, and the board of
publics directors.

• A company needs to be concerned about the

general public’s attitude toward its products
General
and activities.
public • The public’s image of the company affects its
buying.

3-14
 The Macroenvironment

• The company and all of the other

actors operate in a larger macro
environment of forces that shape
opportunities and pose threats
to the company.

• Can not be controlled.

The Company’s
Macroenvironment
 The Company’s Macroenvironment
• The Demographic Environment:
– The study of human populations in terms of size,
density, location, age, gender, race,
occupation, and other statistics.
– Consistently Monitors population.
– The world population is showing explosive growth.
– Demographic environment is important because it
involves people, and people make up
markets.

– Marketers track changing age and family

structures, geographic population shifts,
educational characteristics, and population
diversity.
Key U.S. Demographic
trends
Changing
ChangingAge
AgeStructure
Structure
Population
Populationis
isgetting
gettingolder
older

Changing
ChangingFamily
FamilyStructure
Structure
Marrying
Marryinglater,
later,fewer
fewerchildren,
children,
working
workingwomen,
women,and
andnonfamily
nonfamilyhouseholds
households

Geographic
GeographicShifts
Shifts
Moving
Movingto
tothe
theSunbelt
Sunbeltand
andsuburbans
suburbans

Increased
IncreasedEducation
Education
Increased
Increasedcollege
collegeattendance
attendance
and
andwhite-collar
white-collarworkers
workers
Growing
GrowingEthnic
Ethnicand
andRacial
RacialDiversity
Diversity
73%
73%Caucasian,
Caucasian,12%
12%African-American,
African-American,
10%
10%Hispanic
Hispanic&&3.4%
3.4%Asian
Asian
 Economic Environment

Economic
Economic Changes
Changes
Development
Development in
in Income
Income
Key
Key
Economic
Economic
Concerns
Concerns for
for
Marketers
Marketers

Changes
Changes
in
in Consumer
Consumer
Spending
Spending
Patterns
Patterns
 Income Distribution
• Marketers should pay attention to
income distribution as well as
income levels.
• Over the past several decades, the rich
have grown richer, the middle class
has shrunk, and the poor have
remained poor.
 Natural Environment
• Involves the natural
resources that are
needed as inputs
by marketers or that
are affected by
marketing
activities.
Factors Impacting the Natural
Environment

Shortages of Raw Materials

Increased Pollution

Increased Government Intervention

Environmentally Sustainable Strategies

Environmental Responsibility

The environmental sustainability is

developing strategies and practices that create a
world economy that the planet can support
indefinitely.

McDonald’s has made a substantial commitment to

the so-called “green movement.”
Technological
Environment
• Most dramatic force
now shaping our
destiny.
• Forces that create
new product and
market
opportunities.
• Safety of new
product always a
concern.
Technological Environment
Rapid
Rapid Pace
Pace of
of High
High R
R&&DD
Change
Change Budgets
Budgets

Issues
Issues in
in the
the Technological
Technological
Environment
Environment

Focus
Focus on
on Minor
Minor Increased
Increased
Improvements
Improvements Regulation
Regulation
 Political Environment

Includes Laws,
Increasing Legislation
Government
Agencies, and
Pressure
Changing Government
Groups that Agency Enforcement
Influence or Limit
Various
Organizations Increased Emphasis on Ethics
and Individuals In & Socially Responsible Actions
a Given Society.
 Legislation Regulating Business
• Business legislation has been enacted
for a number of reasons:
– Protect companies from each other
– Protect consumers from unfair business
practices
– Protect the interests of society against
unrestrained business behavior.
 Cultural Environment
• Culture is the learned and shared way of
thinking and acting among a group of people
or society.
• Consists of the institutions and other forces
that affect a society’s basic values,
perceptions, preferences, and behaviors.
 Cultural Environment
• Core beliefs and values are persistent
and passed on from parents to
children and are reinforced by schools,
churches, business, and government.

• Secondary beliefs and values are

more open to change and include
people’s views of themselves, others,
organizations, society, nature, and the
universe.
THANK YOU
FOR YOUR
ATTENTION!!
!