Marketing Environment, Ethics, & Social Responsibility

Intro to Marketing Chapter 3

Environmental Management• Marketers efforts toward achieving

organizational objectives by predicting and influencing the competitive, political/legal, economic, technological, and social/cultural environments. (Controlling the outside forces that may affect the organization)

5 Forces of External Environment• Competitive• Political/Legal• Economic• Technological• Social/Cultural

Competitive Environment

How does it affect an organization?

• New competition may decrease market share.

• Lack of competition will increase sales

Type of Competition

• Direct- between marketers of similar producers.

• Indirect-between products that can be substituted for one another.– Competition among all organizations

that compete for consumers purchasing power.

– Relate this to marketing myopia• Among all

Developing a Competitive Strategy• Should we compete?• In what markets should we

compete?• How should we compete?

– What prices should we charge?– Where will we sell them?– What products should we make?

Time Based Competition

• Developing and distributing goods and services more quickly than competitors

Political/Legal EnvironmentHow does it affect an organization?• Laws regulate a lot of businesses

– FDA Food & Drug Administration– Taxes– Packaging– Imports/Exports– War– Truth in Advertising– FTC, FCC, ICC, EPA, NAFTA– Pricing too low

BusinessCycle

Inflation

Un-employment

Resource Availability

Income

Economic Environment

Figure 2.6 – Increased Spending for Luxury Products during Periods of Prosperity

Figure 2.6 – Increased Spending for Luxury Products during Periods of Prosperity

GodivaExpanding Product Lines During the Prosperity Stage

Godiva adds ice cream to its product line

GodivaExpanding Product Lines During the Prosperity Stage

Godiva adds ice cream to its product line

Technological Environment

• What happens if an organization refuses to change?

• What are some new technological products?

Social/Cultural Environment• Relationship between marketing

and society and its culture. Behaviors of your customer.

• Consumerism– The social force within the

environment that aids and protects the buyer by exerting legal, moral, and economic pressures on business.

– Advocacy groups, boycotts, etc.

Doritos WOW!

Frito-Lay Launches Low-Fat Snacks for Health-Conscious Consumers

Doritos WOW!

Frito-Lay Launches Low-Fat Snacks for Health-Conscious Consumers

Marketing Ethics– Right & Wrong

• Ethical Problems– Research– Product Strategy– Promotion Strategy– Pricing

• Social Responsibility• Ecology

– Planned Obsolescence– Pollution

Social Responsibility• The obligations of marketers to

provide a balance in making profits, consumer satisfaction, and social well-being

Economic

Legal

Ethical

Philan-thropic