The Marketing EnvironmentObjectivesSlide 3Slide 3Key EnvironmentsSlide 6The MicroenvironmentSlide 8Slide 9The MacroenvironmentSlide 11Slide 12Slide 12Slide 13Slide 15Slide 16Slide 17Slide 17Slide 19Slide 19Slide 21Slide 21Slide 23BusinessNowSlide 25Slide 26Slide 27Slide 28Slide 29Slide 30Slide 31Slide 32Slide 33Slide 34Slide 35Responding to the Marketing EnvironmentThe MarketingEnvironment Chapter 4Chapter 44 - 2ObjectivesKnow the environmental forces that Know the environmental forces that affect the company’s ability affect the company’s ability to serve its customers.to serve its customers.Realize how changes in the Realize how changes in the demographic and economic demographic and economic environments affect marketing environments affect marketing decisions.decisions.4 - 3ObjectivesIdentify the major trends in the firm’s Identify the major trends in the firm’s natural and technological natural and technological environments.environments.Know the key changes in the political Know the key changes in the political & cultural environments.& cultural environments.Understand how companies can react Understand how companies can react to the marketing environment.to the marketing environment.4 - 4““Millennial fever” set Millennial fever” set the stage to bring the stage to bring back the VW Beetleback the VW BeetleVW’s investment: VW’s investment: $ 560 million $ 560 million Demand quickly Demand quickly outstripped supplyoutstripped supplycVolkswagenVolkswagenThe new VW beetle The new VW beetle enjoyed cross-enjoyed cross-generational appealgenerational appealEarned many awardsEarned many awardsVW’s Beetle now VW’s Beetle now accounts for over 25% accounts for over 25% of company salesof company salesDiscussion: Is VW’s next nostalgia venture, the “flower-power” Microbus, as likely to succeed?4 - 5Key EnvironmentsMarketing EnvironmentMarketing EnvironmentThe actors and forces that The actors and forces that affect a firm’s ability to build affect a firm’s ability to build and maintain successful and maintain successful relationships with customers.relationships with customers.4 - 6Key EnvironmentsAspects of the marketing Aspects of the marketing environment:environment:Microenvironment: Microenvironment:  Actors close to the companyActors close to the companyMacroenvironmentMacroenvironment Larger societal forcesLarger societal forces4 - 7The MicroenvironmentDepartments within the company impact marketing Departments within the company impact marketing planning.planning.4 - 8The MicroenvironmentSuppliers help to create and deliver Suppliers help to create and deliver customer value.customer value.Treat suppliers as partners.Treat suppliers as partners.4 - 9The MicroenvironmentMarketing intermediaries help to sell, promote, and Marketing intermediaries help to sell, promote, and distribute goods.distribute goods.Intermediaries take Intermediaries take many forms.many forms.ResellersResellersPhysical Physical distribution firmsdistribution firmsMarketing services Marketing services agenciesagenciesFinancial Financial intermediariesintermediaries4 - 10The MacroenvironmentCustomer markets must be studied.Customer markets must be studied.Market typesMarket typesConsumerConsumerBusinessBusinessGovernmentGovernmentResellerResellerInternationalInternational4 - 11The MacroenvironmentSuccessful companies Successful companies provide better customer provide better customer value than the competitionvalue than the competitionSize and industry position Size and industry position help to determine the help to determine the competitive strategy.competitive strategy.4 - 12The MacroenvironmentGovernmentGovernmentMediaMediaFinancialFinancialLocalLocalGeneralGeneralInternalInternalVarious publics must also Various publics must also be considered.be considered.Citizen Action GroupsCitizen Action Groups4 - 13Figure 4-1: Actors in the Microenvironment4 - 14Figure 4-2: Major Macroenvironmental Forces4 - 15The MacroenvironmentKey Demographic TrendsKey Demographic TrendsWorld population World population growthgrowth Now 6.2 billionNow 6.2 billion Projected to Projected to reach 7.9 billion reach 7.9 billion by 2025 by 20254 - 16The MacroenvironmentKey Demographic TrendsKey Demographic TrendsChanging age structureChanging age structure The U.S. population consists The U.S. population consists of seven generational groups. of seven generational groups.•Baby boomers, Generation X and Baby boomers, Generation X and Generation Y are key groups.Generation Y are key groups. Distinct segments typically Distinct segments typically exist within these generational exist within these generational groups. groups.4 - 17The MacroenvironmentBorn between 1946 and 1964Born between 1946 and 1964Represent 28% of the Represent 28% of the population; earn 50% of population; earn 50% of personal incomepersonal incomeMany mini-segments exist Many mini-segments exist within the boomer groupwithin the boomer groupEntering peak earning years Entering peak earning years as they matureas they matureLucrative market for travel, Lucrative market for travel, entertainment, housing and entertainment, housing and moremoreBaby boomersBaby boomersGeneration XGeneration XGeneration YGeneration YKey Key GenerationsGenerations4 - 18The “graying of America” The “graying of America” refers to the fact that as baby refers to the fact that as baby boomers get older, the boomers get older, the average age of the U.S. average age of the U.S. population increases.population increases. Today, baby boomers are a Today, baby boomers are a great target for exotic travel.great target for exotic travel. Think ahead to 20 years in Think ahead to 20 years in the future. For what types of the future. For what types of products and services will products and services will baby boomers represent a baby boomers represent a prime target?prime target?Discussion Question4 - 19The MacroenvironmentBorn between 1965 and 1976Born between 1965 and 1976First latchkey childrenFirst latchkey childrenMaintain a cautious Maintain a cautious economic outlookeconomic outlookShare new cultural concernsShare new cultural concernsRepresent $125 billion in Represent $125 billion in annual purchasing powerannual purchasing powerWill be primary buyers of Will be primary buyers of most goods by 2010most goods by 2010Baby