1. Analyzing the Marketing Environment

2. Famous photocopier Did not respond to the market environment change Immediate loss Adapted to the change Became leaders in the changed environment Micro and macro environments of the organization

3. The company Suppliers Marketing intermediaries: they help find customers to make sales Resellers Physical distribution firms Marketing service agencies Financial intermediaries Competitors Publics Customers

4. Financial publics: banks, investment houses and stockholders Media publics: newspaper, magazines, radio and tv Government publics: ethics, product safety, etc. Citizen-action publics: consumer organizations, environmental groups, minority groups, labor activists. Local publics: neighborhood residents and community organizations. General public Internal publics: workers, managers, volunteers and board of directors

5. Consumer markets Business markets Reseller markets Government markets International markets

6. The factors in macroenvironment shape opportunities and pose threat for the company Remember the shortcut? PESTEL. For sake of this course the new shortcut is PESTED. Where: P is for Political E is for Economical S is for Sociocultural T is for Technological E is for Environmental D is for Demographical

7. Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation and other statistics. Increasing population: high birth rates leading to higher opportunities for products targeting infants. A growing middle-class: Indian perspective Deprived households: annual income less than Rs. 90,000 Aspirers: annual income Rs. 90,000 to Rs. 200,000 Seekers: Rs. 200,000 to Rs. 500,000 Strivers: Rs. 500,000 to Rs. 1,000,000 Global Indians: over Rs. 1,000,000

8. Growth in the rural population Low purchasing power Lack of proper infrastructure (road, communication connectivity, reliable source of electricity) a changing family system: nuclear family, both parents working, no proper care for the elderly Class debate: Joint family system vs. Nuclear family system

9. The changing role of women: many advertisements are targeting working women. Sunsilk, Nesvita A better educated, more white-collared, more professional population Increasing diversity

10. Premium products like those of Apple suffer most with economic downturn. The global financial crisis: 2007-2009 default on mortgages. Changing income distribution and consumer spending patterns: Ernst Engel and Engel’s laws. Engel’s Laws: differences noted over a century ago by Ernst Engel in how people shift their spending across food, housing, transportation, health care, and other goods and services categories as family income rises.

11. The natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities. Concentration of industries in a naturally rich location endangers the environment. Environmental concerns have grown over past years. Shortage of raw materials…even air and water! Increased pollutoin due to increased industries. Increased government intervention: highly expensive solutions to pollution problems

12. Imagine a world with tiny transmitters carried by every individual that tracks his/her buying behavior, activities and interests. Presently, smart chips are used with products which track down the inventory storage and usage in every store. New technologies create new markets and opportunities; however, every new technology replaces the old one. Hence, marketers need to keep track of technological changes in the environment to stay ahead in the competition.

13. Legislation: case study-the Sialkot soccer ball industry and child labor Increased emphasis on ethics and socially responsible actions Socially responsible behavior: organizational rules and guidelines, internet piracy Cause-related marketing: most companies are linking themselves to worthwhile causes. E.g. products donating some amount per product they sell for cancer cause. Starbucks help provide clean water to children who are deprived of this ‘basic luxury’.

14. Cultural environment includes institutions and other forces that affect society’s basic values, perceptions, preferences and behaviors. Core beliefs and values are passed from parents to children and reinforced by schools, business and government. Secondary beliefs can be changed, and this is where marketers play role.

15. People’s views of themselves: do it yourself, adventurers People’s views of others: socializing on internet, not reality People’s views of society: patriotic, reformers, malcontents.