Module 2 mkt_env

©2000 Prentice Hall

PURPOSE OF MARKETING ENVIRONMENT ANALYSISPURPOSE OF MARKETING ENVIRONMENT ANALYSIS

To know the relevant events & trends in the To know the relevant events & trends in the environment.environment.

Discover the opportunities & threats.Discover the opportunities & threats. Environmental projection.Environmental projection. Assess scope of opportunities.Assess scope of opportunities. Right fit between the environment & business Right fit between the environment & business

unit.unit. Formulate the right marketing strategy. Formulate the right marketing strategy.


Political factorsPolitical factors

Taxation Policy Trade regulations Governmental stability Unemployment Policy etc.


Economic factorsEconomic factors

Income DistributionIncome Distribution

Subsistence economies-few opp. For marketerSubsistence economies-few opp. For marketer

Raw-material-exporting economiesRaw-material-exporting economies

Industrializing economies-IndiaIndustrializing economies-India

Industrial economies-rich markets for all sorts of goodsIndustrial economies-rich markets for all sorts of goods

Savings, Debt, & Credit AvailabilitySavings, Debt, & Credit AvailabilityOutsourcing and

free tradeOutsourcing and

free trade


Economic factorsEconomic factors

GENERAL ECONOMIC ENV.GENERAL ECONOMIC ENV. Economic conditions of different segments of Economic conditions of different segments of

population-disposable income, purchasing power etc.population-disposable income, purchasing power etc. Rate of growth of industryRate of growth of industry Income, priceIncome, price TaxesTaxes Foreign exchange reservesForeign exchange reserves Exchange ratesExchange rates Inflation rate Growth in spending power Rate of people in a pensionable age etc.


Social/Cultural factorsSocial/Cultural factors

OfOfOrganizationsOrganizations

OfOfNatureNature

OfOfOneselfOneself

OfOfSocietySociety

OfOfthe Universethe Universe

OfOfOthersOthers

ViewsThat Express

Values

ViewsThat Express

Values



SOCIO – CULTURAL ENVIRONMENTSOCIO – CULTURAL ENVIRONMENT Core Cultural Values-religion, language, Core Cultural Values-religion, language,

education, & upbringingeducation, & upbringing Secondary Cultural Values-consumption Secondary Cultural Values-consumption

habits, lifestyles, buying behaviourhabits, lifestyles, buying behaviour Social Class-income, occupation, Social Class-income, occupation,

location of residence.location of residence.




Accelerating Paceof Change

Accelerating Paceof Change

Unlimited Opportunitiesfor Innovation

Unlimited Opportunitiesfor Innovation

IncreasedRegulation

IncreasedRegulation

Technological factorsTechnological factors

VaryingR & D Budgets

VaryingR & D Budgets


Legal factors

Corporate affairsCorporate affairs

Consumer protectionConsumer protection

Sectoral protectionSectoral protection

Corporate protectionCorporate protection

Control on trade practicesControl on trade practices


Demographic factorsDemographic factors

Worldwide Population GrowthWorldwide Population Growth

Population Age MixPopulation Age Mix

Ethnic MarketsEthnic Markets

Household PatternsHousehold Patterns

Educational GroupsEducational Groups

Geographical Shifts in PopulationGeographical Shifts in Population


Natural factors

Higher PollutionLevels

Higher PollutionLevels

Increased Costsof Energy

Increased Costsof Energy

Shortage of Raw MaterialsShortage of

Raw Materials

Changing Roleof GovernmentChanging Roleof Government


Micro Environmental FactorsMicro Environmental Factors

MARKET /DEMANDMARKET /DEMAND Nature of demandNature of demand Size of the demand, present & potentialSize of the demand, present & potential Changes taking place in demandChanges taking place in demand Invasion of substitute productsInvasion of substitute products Changes taking place in consumption Changes taking place in consumption

patterns or buying habits.patterns or buying habits.



THE CONSUMERTHE CONSUMER Product perceptionProduct perception What constitutes customer value?What constitutes customer value? Preferences / Priorities / Rankings of product benefitsPreferences / Priorities / Rankings of product benefits Purchasing power Purchasing power Buying behaviour/Buying motives/Buying habitsBuying behaviour/Buying motives/Buying habits Personality traits/ attitudesPersonality traits/ attitudes Lifestyles & needsLifestyles & needs Brand loyaltyBrand loyalty Brand switchingBrand switching



INDUSTRY & COMPETITIONINDUSTRY & COMPETITIONCompetitive advantage building Competitive advantage building

depends on a proper grasp of the depends on a proper grasp of the position of the industry & competition.position of the industry & competition.



GOVERNMENT POLICIESGOVERNMENT POLICIESGovernment as purchaser.Government as purchaser.Government subsidies.Government subsidies.Protection of domestic industries.Protection of domestic industries.Restricted entry into certain sectors.Restricted entry into certain sectors.Government as competitor.Government as competitor.



SUPPLIER RELATED FACTORSSUPPLIER RELATED FACTORSSuppliers have bargaining power- Suppliers have bargaining power-

influence cost of raw materials.influence cost of raw materials. Integrate vs Outsource.Integrate vs Outsource.


CONTINOUS ENVIRONMENT ANALYSIS

CONTINOUS ENVIRONMENT ANALYSIS

Environmental Components – are in a Environmental Components – are in a constant flux.constant flux.

Firm- has to analyze the environment Firm- has to analyze the environment on a continuous basis.on a continuous basis.

Fresh Facts from Environment Analysis- Fresh Facts from Environment Analysis- influence implementation & monitoring influence implementation & monitoring of strategy.of strategy.


Porter’s 5 forces modelPorter’s 5 forces model


PESTLE ANALYSISPESTLE ANALYSIS


SWOT analysisSWOT analysis

Strengths

Opportunities

Weakness

Threats

Factors Internal to Organization

Factors External to Organization


THANK YOUTHANK YOU

Business

Module 2 mkt_env