unit1 sec3 mktgenvironment,mis2007

8/9/2019 Unit1 Sec3 MktgEnvironment,MIS2007

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Marketing Management

Unit I Section3 Part 1MIS, Data Warehousing, Data Mining &

Marketing Environment


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What we will learn in thisSection

What are the components of a modern marketinginformation system?

What are useful internal records?

What is involved in a marketing intelligence system?

The need of environmental scanning. How external micro environment affects the companys

strategies.

The influence of external macro environment on

companys plans. The difference between the external macro and micro

environment.

The role of organizations internal environment in dealingwith opportunities and threats.


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Need for environmentalscanning

Identifying the opportunities that companyhas in immediate future.

Identifying the threats faced by the

company.

Demand forecasting

Developing appropriate business plans.

Adjusting the company strategy inchanging competitive environment.


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Marketing Environment


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Environmental Forces

Demographic

Economic

Socio-Cultural

Natural

Technological

Political-Legal


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Population and Demographics

Householdpatterns

Regionalcharacteristics

Movement

Growth rate Size

Age distribution

Ethnic mix Educational

levels


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Age Structure in India (Urban)

014years:30.8%(male173,478,760 /female163,852,827)

1564 years: 64.3% (male363,876,219/female 340,181,764)

65 years and over: 4.9% (male27,258,020/female 26,704,405)


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Geographic Redistribution

Geographical redistributionseparates differentgenerations in differentspace and time zones Increases gaps both within

and between generations

People living in different areasof the country reflectdifferent values, lifestyles,and attitudes Regional marketing responds

to and feeds the differencesby exposing newly arrivedresidents to regional tastes


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Economic Environment

Purchasing Power

IncomeDistribution

Savings Rate

Debt

Credit Availability


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Economic Forces

Stages in the Business Cycle

Prosperity Low unemployment and high total incomecreate high buying power

Recession Rising unemployment reduces total buyingpower; consumer and business spendingdecline

Depression Unemployment extremely high, wages andtotal disposable income are very low, andthere is a lack of consumer confidence

Recovery Economy is moving out of recession ordepression towards prosperity


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Economic Forces (contd)

Buying Power

Resources, such as money,goods, and services, that can betraded in an exchange

Income Disposable income (After Tax)

Discretionary income (Incomeavailable for spending or savingafter buying the basicnecessities)

Wealth


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Economic Forces (contd)

Willingness to Spend An inclination to buy because of expected

satisfaction from a product, influenced by theability to buy and the numerouspsychological and social forces

Expectations influencing the willingness tospend:

Future employment

Income levels

Prices

Family size

General economic conditions (e.g.,rising prices)


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The Increasing Middle Class & NeoRich

Four key implications:

An increasing range inprices of products

More customer militancy Affordability

The neo rich


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Improvement of Downtrodden

Two distinctimplications:

Segmented

markets Cultural

diversity


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Political Forces

Reasons for Maintaining Relations withElected Officials and Politicians

To influence the creation of laws andregulations affecting industries andspecific businesses

Governments are potentially largecustomers

Political officials can assist in securingforeign markets

Campaign contributions of corporate-related individuals and political actioncommittees may provide influence

Lobbyists work to communicatebusinesses concerns about issuesaffecting their industries and markets


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Legal and Regulatory Forces

Procompetitive Legislation Laws designed to:

preserve competition

prevent the restraint of trade and themonopolizing of markets

prevent illegal competitive tradepractices

Consumer Protection Legislation Laws enacted to protect customers from:

adulterated and mislabeled food and

drugs deceptive trade practices and the sale

of hazardous products

the invasion of personal privacy and themisuse of personal information byfirms


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Natural Environment

Shortage of rawmaterials

Increased energy costs

Global warming

Anti-pollution pressures

Governmental

protections


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Technological Environment

Pace of change

Opportunities forinnovation

Varying R&D budgets

Increased regulation ofchange


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Pace of Change

The time takento reach the same levelof penetration

Radio: 38 years

Telephone: 25 years Cable television: 10 years

Internet: Less than 5 years


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Did You Know this about USA?


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Digi Home


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Marriage Proposal


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Socio Cultural Environment

Effects of the workingwomen trend: A significant change in

the resources of a

household Time shortage: lack

of free time

Time shift: the timewhen nonwork-related activities

may be pursued A shift in the lifestyle of

families With both spouses

working,

households haveturned into


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E i i d R di t


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Examining and Responding tothe Marketing Environment

Environmental Scanning The process of collecting information about

forces in the marketing environment

Observation

Secondary sources Market research

Environmental Analysis The process of assessing and interpreting the

information gathered through environmental

scanning Accuracy

Consistency

Significance


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Examining and Responding to the

Marketing Environment (contd)Responding to Environmental Forces Reactive approach

Passive view of environment asuncontrollable

Current strategy is cautiouslyadjusted to accommodateenvironmental changes

Proactive approach

Actively attempts to shape and

influence environment

Strategies are constructed toovercome market challenges andtake advantage of opportunities


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What we learnt in this Unit What are the components of a modern marketing

information system?

What are useful internal records?

What is involved in a marketing intelligence system?

The need of environmental scanning.

How external micro environment affects the companysstrategies.

The influence of external macro environment oncompanys plans.

The difference between the external macro and microenvironment.

The role of organizations internal environment in dealingwith opportunities and threats

unit1 sec3 mktgenvironment,mis2007

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