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Principles of marketing k&a chapter 3 MOGHIMI KOTLER University of Georgia
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oghimi@
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Lecturer: Bahman MoghimiM.Sc. Of “Industrial Marketing & e-Commerce”Doctor of Business Administration
Session Three University of Georgia
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What is Paradigm Shift?
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oghimi@
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Marketing Environment
The actors and forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers
– Micro-environment: The actors close to the company that affect its ability to serve its customers— the company, suppliers, marketing intermediaries, customer markets, competitors, and publics.
– Macro-environment: The larger societal forces that affect the microenvironment—demographic, economic, natural, technological, political, and cultural forces.
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oghimi@
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The Economic Environment
Markets require buying power as well as people. The economic environment
consists of economic factors that affect consumer purchasing power and
spending patterns. Marketers must pay close attention to major trends and
consumer spending patterns both across and within their world markets.
Nations vary greatly in their levels and distribution of income. Some countries
have industrial economies, which constitute rich markets for many
different kinds of goods. At the other extreme are subsistence economies;
they consume most of their own agricultural and industrial output and offer
few market opportunities. In between are developing economies that can
offer outstanding marketing opportunities for the right kinds of products.10
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oghimi@
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The Natural Environment
The natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities.
Today’s enlightened companies are developing environmentally sustainable strategies in an effort to create a world economy that the planet can support indefinitely
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oghimi@
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Trends in the natural environment.
Growing shortages of raw materials
Increasing pollution
Increasing government intervention in natural
resource management
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oghimi@
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The Technological Environment
Forces that create new technologies, creating new product and market opportunities.
– Technological advances are perhaps the most dramatic forces affecting today’s marketing strategies. Just think about the tremendous impact of the Web— which emerged in the mid-1990s—on marketing...
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oghimi@
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The Political and Social Environment
Laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society.
Even the most liberal free-market advocates agree that the system works best with at least some regulation. But beyond regulation, most companies want to be socially responsible. If you look at almost any company’s Web site, you’ll find long lists of good deeds and environmentally responsible actions.
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oghimi@
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Legislation Regulating Business
Business legislation has been enacted for a number of reasons:– The first is to protect companies from each other!– The second purpose of government regulation is to
protect consumers from unfair business practices.– Third is to protect the interests of society against
unrestrained business behavior
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oghimi@
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Increased Emphasis on Ethics and Socially Responsible Actions
Written regulations cannot possibly cover all potential marketing abuses, and existing laws are often difficult to enforce. However, beyond written laws and regulations, business is also governed by social codes and rules of professional ethics.
Socially Responsible Behavior Cause-Related Marketing
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oghimi@
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The Cultural Environment
Institutions and other forces that affect society’s basic values, perceptions, preferences, and behaviors
Cultural factors strongly affect how people think and how they consume. So marketers are keenly interested in the cultural environment.
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oghimi@
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Shifts in Secondary Cultural Values
Core beliefs and values are passed on from parents to children and are reinforced by schools, churches, business, and government
Secondary beliefs and values are more open to change
Believing in marriage is a core belief; believing that people should get married early in life is a secondary belief.
Marketers have some chance of changing secondary values but little chance of changing core values. For example, family-planning marketers could argue more effectively that people should get married later than not getting married at all.25
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oghimi@
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Shifts in Secondary Cultural Values
People’s Views of Themselves People’s Views of Others People’s Views of Organizations People’s Views of Society People’s Views of Nature People’s Views of the Universe
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oghimi@
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Responding to the Marketing Environment
Rather than simply watching and reacting, companies should take proactive steps with respect to the marketing environment.
Marketing management cannot always control environmental forces. In many cases, it must settle for simply watching and reacting to the environment.
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oghimi@
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1. What micro-environmental factors have affected Target’s performance over the past few years?
2. What macro-environmental factors have affected Target’s performance during that period?
3. By focusing on the “Pay Less” part of its slogan, has Target pursued the best strategy? Why or why not?
4. What alternative strategy might Target have followed in responding to the first signs of declining revenues and profits?
5. Given Target’s current situation, what recommendations would you make to Steinhafel for his company’s future?
