1. The Marketing Environment

2. Introduction The importance of understanding the Marketing Environment Micro-environments vs. Macro-environments Scan environments for – Fads – Trends – Megatrends

3. Actors in the Microenvironment

4. Forces in the Macroenvironment

5. Demographics The study of human populations in terms of Population Size Population Density Population Location Income Age Gender Race, Ethnicity & Religion Occupation Education Other Classifications

6. Demographic Trends Aging of U.S. Population Prevalence of Baby Boomers Changing Family Structures – The collapse of traditional marriage – Single-parent households – Smaller “traditional” families – Extended families getting bigger – Friends and colleagues are the new family – Civil unions and co-habiting – LGBT community – Changing gender roles

7. The Baby Boomer Segment – 78 million born between 1946 and 1964. – 28% of population. – Earn more than 50% of all personal income. – 25% belong to racial or ethnic minority. – Spend a lot on anti-aging products and services. – Are likely to postpone retirement. – “Mature Hedonists”

8. Demographic Trends, cont. Geographic Shifts – Migration to Sunbelt States – Urban Exodus and Re-entry – Micropolitan area migrations Work-Life – The rise of tele-commuting – Delayed Retirements – Work-life balance trends – “Cocooning” Better educated population Blue- to white-collar shift Increasing Ethnic Diversity – Asians – Hispanics – African Americans

9. Capitalizing on Demographic Shifts

10. Economic Forces $ Purchasing Power $ Employment $ Income Distribution $ Savings Rate $ Debt $ Credit Availability

11. Natural Forces Shortages of raw materials Catastrophes (i.e. Katrina) Pollution concerns Global warming and carbon footprint “Greening of America” Push for environmental sustainability Eco-friendly products and attitudes

12. Technological Forces Obsolescence – A double-edged sword – Advantages New Market Opportunities Increased Productivity Cost Savings – Disadvantages Cannibalization of current offerings Consumer frustration and alienation Undue pressure to advance leads to feature creep and sub-optimal product changes

13. Political-Legal Forces Federal, State and Local Laws Lobbyist and Watchdog Groups Changes in Leadership

14. Political-Legal Forces, cont. Labeling: Success or Failure?

15. Political-Legal Forces, cont. Unit Pricing: Success or Failure?

16. Cultural Forces Defining Culture: Sources and Perpetuation The institutions and other forces that affect a society’s basic values, perceptions, preferences, and behavior. The institutions and other forces that affect a society’s basic values, perceptions, preferences, and behavior. Culture is never stagnant Core Beliefs vs. Secondary Beliefs Strongest determinant of wants and needs

17. Question du Jour Can Marketers ever ignore Culture when developing new products?