1. Evaluating Opportunities in the Changing Marketing Environment
Chapter 3
Evaluating Opportunities in the Changing Marketing Environment
Chapter Three
Evaluating Opportunities in the Changing Marketing Environment
For use only with Perreault/Cannon/McCarthy or Perreault/McCarthy texts. © 2009 McGraw-Hill Companies, Inc. McGraw-Hill/Irwin

2. At the end of this presentation, you should be able to:
This slide refers to material on page 60.
Know the variables that shape the environment of marketing strategy planning.
Understand why company objectives are important in guiding marketing strategy planning.
See how the resources of a firm affect the search for opportunities.
Know how the different kinds of competitive situations affect strategy planning.
Understand how the economic and technological environment can affect strategy planning.
At the end of this presentation, you should be able to :
Know the variables that shape the environment of marketing strategy planning.
Understand why company objectives are important in guiding marketing strategy planning.
See how the resources of a firm affect the search for opportunities.
Know how the different kinds of competitive situations affect strategy planning.
Understand how the economic and technological environment can affect strategy planning.

3. At the end of this presentation, you should be able to:
This slide refers to material on page 60.
Know why you might be sent to prison if you ignore the political and legal environment.
Understand how to screen and evaluate marketing strategy opportunities
At the end of this presentation, you should be able to :
Know why you might be sent to prison if you ignore the political and legal environment.
Understand how to screen and evaluate marketing strategy opportunities.

4. Marketing Strategy Planning: Competitors, Company & External Market Environment (Ex. 3-1)
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Summary Overview
The text’s comprehensive model is referenced to indicate where we are, and what is covered in the following discussion
Key Issues
External market environment, company, and competitors are key elements that must be factored in as the firm develops its marketing mix.

5. Best opportunities to pursue
Marketing Strategy Planning: Competitors, Company & External Market Environment (Ex. 3-1)
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Company
Objectives
Resources
Competitors
Current
Prospective
External Marketing Environment
Economic
Technological
Political & Legal
Cultural & Social
Summary Overview
Specific aspects of the external market environment, company, and competitors aid the firm in evaluating opportunities. From these opportunities, the best opportunities can be selected.
Key Issues
Each company has objectives it wants to accomplish, and specific resources at its disposal.
When looking at its competitors, firms must include not only its current competitors, but potential (future) ones as well.
The external market environment is made up of: the economic environment, the technological environment, the political and legal environment, and the cultural and social environment.
Opportunity evaluation is aided by several screening criteria, or proscriptive planning grids, covered in the chapter. Often, firms must plan for multiple products simultaneously.
Once all the above are considered, and firm should be able to identify the best opportunities to pursue.
Discussion Question: Think of a firm that is identified with one major product. Who are its current competitors? Who are its potential competitors?
Evaluating Opportunities
Screening criteria
Planning grids
Planning for multiple products
Best opportunities to pursue

6. The Marketing Environment
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Customers
Resources and Objectives of the Firm
Competitive Environment
Direct Marketing Environment
Cultural and Social Environment
Economic Environment
Technological Environment
Political and Legal Environment
Target
Summary Overview
The five basic areas of the marketing environment are shown in this diagram. Marketers should consider each area and how each area interacts with the others when planning strategies.
Key Issues
Direct market environment: customers, the resources and objectives of the company, and the firms’ competitors.
External market environment: the economic environment, the technological environment, the political and legal environment, and the cultural and social environment.
Marketers make decisions about the 4Ps in the context of the environment.
Discussion Question: How is it that a marketer can influence, but not directly control, the environment? Give an example.
Marketers must continually scan the environment and search for potential opportunities and threats.
External Marketing Environment

7. Objectives Set Firm’s Course
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Three Basic Objectives Provide
Guidelines
Socially and Economically Useful Function
Summary Overview
When top management sets objectives for an organization, it is especially important to consider the potential impact of the various sectors of the environment.
Key Issues
Company objectives provide guidelines for the present and future development of the firm. A company should:
Engage in specific activities that will perform a socially and economically useful function.
Develop an organization to carry on the business and implement its strategies.
Earn enough profit to survive.
Discussion Question: How are social good and economic viability interrelated?
A firm’s organization and infrastructure--the way it is set up--must be created and coordinated to support the firm’s strategies. Profit is necessary for continued operation.
Develop an Organization
Earn Profit

8. Hierarchy of Objectives (Exhibit 3-2)
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Mission Statement
Company Objectives
Production Objectives
Finance Objectives
Marketing Objectives
HR Objectives
R&D Objectives
Summary Overview
The three general objectives provide guidelines. A firm should develop its own objectives – which usually reflect a company’s mission statement and objectives.
Key Issues
A mission statement helps set the course. It sets out the organization’s basic purpose for being.
 The whole firm and each functional area should work toward the same objectives. Company objectives provide the larger framework for setting marketing objectives.
Marketing objectives guide the development of objectives for each element of the marketing mix.
Knowing the objectives for a specific element of the marketing mix then guides more specific objectives.
For example, marketing objectives drive promotion objectives
And then promotion objectives will drive objectives for each element of the promotion blend.
Objectives should be explicit--quantified and related to time deadlines.
Discussion Question: What does it mean to say that objectives should be “quantified”? Why are quantified objectives preferable to objectives that are not quantified?
Product Objectives
Place Objectives
Price Objectives
Production Objectives
Finance Objectives
HR Objectives
R&D Objectives
Promotion Objectives
Personal Selling Objectives
Mass Selling Objectives
Sales Promotion Objectives
Product Objectives
Place Objectives
Price Objectives

9. Company Resources May Limit Search for Opportunities
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Financial Strength
Summary Overview
It is important to evaluate how realistic each opportunity is in relation to the specific capabilities of the company.
Key Issues
Key areas that limit the search for opportunities are:
Financial strength—some opportunities require significantly more capital than others.
For example, developing a drug to cure cancer might require a very large investment in research development.
Producing capability and flexibility – a company must decide if it has the production capacity and skills needed to pursue a particular opportunity.
As production increases, the cost of producing each unit decreases.
Making changes can be costly and take time.
Marketing strengths--competitive advantages, such as:
familiar brand
strong channel relations;
creative brand advertising;
industry-leading salesforces.
Discussion Question: Several years ago, Frito-Lay, a leading producer of snack foods, added cookies to its traditional line of salty snacks. What marketing strengths could Frito-Lay bring to bear in this extension of its product line? 
Producing Capability and Flexibility
Marketing Strengths

10. Marketing Strengths This slide relates to material on pp. 64-65.
Summary Overview
A major marketing strength for many companies is a familiar brand name like Crest.
Key Issues
Major thrust of this ad is the promotion of Crest’s Rejuvenating Effects.
Rejuvenation and youth naturally complement each other.
This ad highlights the main benefits of the product: strengthening enamel, whitening teeth, and “refreshing” gums.
Discussion Question: What other marketing strengths does Crest have, in addition to a strong brand name?

11. The Competitive Environment
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Avoid Head-On Competition!
Summary Overview
 The competitive environment affects the number and types of competitors the marketing manager must face -- and how they may behave. Prudent managers choose strategies that avoid head-on competition and/or plan for competition when it is inevitable.
Key Issues
Marketers should understand the differences among types of market situations:
 Monopoly: one company serves the entire customer base. Competitor-free environments are rare.
 Monopolistic competition: a number of different firms offer marketing mixes that at least some customers see as different. Monopolistic competition is typical, and a challenge.
 Oligopoly: a small number of firms controls the market. Barriers to competitive entry are high.
 Pure competition: a large number of firms compete with essentially similar (commodity) products. Price is typically the determining factor in making a purchase.
Discussion Question: Can you think of an example for each of the four types of competitive situations? For which market situation(s) is it easiest to think of an example? For which type is it hardest to think of an example? Why?
Know the Market Situation!
Monopoly
Monopolistic Competition
Oligopoly
Pure Competition

12. Competitive Advantage
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Competitive Advantage
Summary Overview
There are many producers of cleaners. OxiClean, the producer featured in this ad, is one of them.
Key Issues
In monopolistic competition, the firm attempts to monopolize its own target market, but competition still exists.
As the ad indicates, OxiClean attempts to avoid head-on competition by being innovative with newer products, that work better.
Discussion Question: How can OxiClean be innovative when dealing in an competitive product-market against other cleaners? What types of issues might be important to customers buying OxiClean from their grocer or other store?

13. Avoiding Head-On Competition
Courtesy of Shell
Most product-markets head toward pure competition – or oligopoly – over the long term. In these situations, competitors offer very similar products. Thus, it is up to marketing managers to differentiate their products from those of the competition. This can be done in many ways. For example, in this ad, Shell Oil is attempting to differentiate itself from its competitors by encouraging people concerned with protection and physical well-being to write for a free book: “Learn How To Avoid Driving’s Most Dangerous Distractions.”
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14. Analyzing Competition
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Competitor Analysis
Competitive Rivals
Key
Concepts
Summary Overview
Marketing managers must understand the competitive environment.
Key Issues
Competitor analysis is an organized approach for evaluating the strengths and weaknesses of current or potential competitors' marketing strategies. Marketers do this by gathering information on the competitors from a variety of internal and external sources.
Competitive rivals: the firms that will be the closest competitors.
Marketing managers must anticipate future competition.
Successful marketers naturally attract competition.
Search for competitive advantage: new or better ways to satisfy customer needs and provide better value than the competition.
Discussion Question: Think about a major grocery store chain that serves your area. What are the competitive rivals for this chain? Are these rivals the only relevant competitors? Why or why not?
Competitive barriers--the conditions that make it difficult or impossible for a firm to compete in a given market.
Competitive Barriers
Competitive Advantage

15. Marketers Need Information about Competitors
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Seek Information About Competitors
Ethical Issues
Summary Overview
Marketing managers should seek out information on competitive practices.
Key Issues
The search for information raises ethical issues.
Discussion Question: How would you answer the following questions?
Should people who go to work for their former competitors use information they gained from their previous employers?
Is there anything wrong with having computer hackers break into a competitor’s computer system to access information?
If direct competition cannot be avoided, the marketer has to deal with the competitive threat—either by leaving the industry or by trying to outperform the competition.
Direct Competition Can’t Always Be Avoided

16. Checking Your Knowledge
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A moderately-priced jewelry store is trying to differentiate
itself from other jewelry stores. The store prices products
somewhat lower than the super-premium jewelry stores,
but offers better products and services than low-end
jewelry stores provide. The market situation this store
faces sounds most like:
pure competition.
monopoly.
oligopoly.
monopolistic competition.
oligopolistic competition
Answer: D
Checking your knowledge (answer explanation):
In the above question, there are three different jewelry stores discussed (low-end, moderately-priced, and super-premium). Each store differs on pricing, quality of merchandise, and services. In monopolistic competition, a number of different firms (at least three different jewelry stores mentioned) offer marketing mixes that at least some customers see as different. This question is an example of monopolistic competition. ‘D’ is the best answer selection.

17. Checking Your Knowledge
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Chris wants to open a family-oriented restaurant in a
thriving suburban area. Chris thinks a sports-based theme
and broad menu will be attractive to the large number of
families in the area. However, national chain restaurants,
such as Chili’s, TGI Friday’s, and Applebee’s already
draw large followings in the area. The existence of these
chain restaurants is a significant:
competitive opportunity.
monopoly.
competitive barrier.
opportunity.
competitive environment.
Answer: C
Checking your knowledge (answer explanation):
In his competitor analysis, Chris has identified three national chain restaurants that are already in his area and have established clientele. The existence of these restaurants is a condition that may make it difficult for Chris’ proposed restaurant to compete. The best answer selection is ‘C’. Chili’s, TGI Friday’s and Applebee’s are competitive barriers for entry into this market with a restaurant of Chris’ description.

18. The Economic Environment
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Global Economy
Rapid Change
Key
Economic Forces
Summary Overview
 The economic and technological environment affects the way firms and the whole economy use resources. The economic environment is affected by the interactions of all the elements of the macro-economic system.
Key Issues
The economic environment can change very rapidly. In periods of rapid business decline, even a well-planned marketing strategy may fail.
Discussion Question: Can you name a major world event that changed the economic environment and drastically altered the business practices of a major industry?
Interest rates and inflation affect consumer buying processes.
Interest rates can go up sharply in times of high inflation.
Buying power declines during high inflation.
The global economy is increasingly connected.
Competition can come from almost anywhere.
Global trade is affected by exchange rates.
Interest Rates

19. The Technological Environment
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Summary Overview
Technology is the application of science to convert an economy’s resources to output. Technology affects marketing in two basic ways: opportunities for new products and opportunities for new processes. In modern economies, the rate of technological change is very rapid.
The video clips highlights the extensive use of the bar code technology in manufacturing, retailing, wholesaling, transportation, and medical industries.
Key Issues
Technological advances create new market opportunities.
Technology transfer is rapid from one country to the next.
Internet technologies are reshaping marketing.
Discussion Question: In what other ways has the Internet affected marketing? Hint—think about each of the 4Ps.
Technology also poses challenges.
Sometimes, new technological breakthroughs are rushed to market.
Technology also speeds up obsolescence.
Technology has also raised ethical issues about the privacy of personal information, ecological concerns, and the intrusiveness of telemarketing and Internet advertising.
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For video playing assistance, please see notes on slide 13.
© 2009 McGraw-Hill Companies, Inc., McGraw-Hill/Irwin

20. The Political Environment
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Examples of
Characteristics of the Political Environment
Nationalism
Regional Economic Groupings
Summary Overview
The political environment refers to the way societies order their governments and to the attitudes of the government and people toward business.
Let’s talk about two examples of different characteristics of the political environment.
Key Issues
Nationalism is an emphasis on a country’s interests before anything else.
Nationalism can be limiting in international markets, by reducing sales and blocking marketing activity.
Regional economic groupings are becoming more important.
The European Union has unified European markets.
The North American Free Trade Agreement (NAFTA) is building trade cooperation in North America.
Discussion Question: Are regional groupings a form of nationalism? Explain.

21. The Legal Environment – Key Antimonopoly Laws
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Sherman Act (1890)
Clayton Act (1914)
Federal Trade Commission (1914)
Robinson-Patman Act (1936)
Wheeler-Lea Amendment (1938)
Antimerger Act (1950)
Magnuson-Moss Act (1975)
Summary Overview
The legal environment refers to the rules and laws that set standards for conduct that are enforced by legal power. Starting in 1890, the United States Congress passed a series of laws designed to encourage competition. Each of these laws regulates different aspects of the marketing mix.
Key Issues
There is also a relationship between antimonopoly laws and marketing mix planning.
For example, the Sherman Act prohibits monopoly or conspiracy to control a product, distribution channels, or prices.
Prosecution is serious and can lead to a variety of penalties, including heavy fines and jail terms.
Discussion Question: In light of all of the legislation prohibiting anticompetitive behavior and deceptive practices, why do you think we still see false advertising claims or deceptive prices?

22. The Legal Environment – Consumer Protection Agencies
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Federal Trade Commission (FTC)
Food and Drug Administration (FDA)
Consumer Product Safety Commission (CPSC)
Federal Communications Commission (FCC)
Environmental Protection Agency (EPA)
Summary Overview
This slide provides a description of some important Federal regulatory agencies, many of which deal with consumer protection.
Key Issues
Consumer protection is not new.
Sellers are required to be truthful, meet contracts, and stand behind their products.
Food and drugs are controlled by the Food and Drug Administration (FDA).
One major initiative of the FDA is the development of standards for nutritional labeling.
Product safety is also controlled.
The Consumer Product Safety Act of 1972 empowers its commission to remove unsafe products from the market.
State and local laws may vary widely.
For example, every state has different automotive franchise legislation governing the retailing of new vehicles.
The F.C.C. has control over the airwaves and the E.P.A. protects the environment.
Marketers must know the laws.
“Let the seller beware”--marketers must adapt to an environment in which lawmakers are becoming increasingly concerned with consumer protection.
Discussion Question: What are some areas of consumer protection that are of current interest to the courts and to political leaders?
“Let the Seller Beware”

23. Checking Your Knowledge
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Rising interest rates can slow the housing market in the
United States, slowing business for real estate developers,
mortgage lenders, and construction firms. This is a trend in
the:
competitive environnent.
technological environment.
cultural environment.
economic environment.
legal environment.
Answer: D
Checking your knowledge (answer explanation):
Changes in the economy are often accompanied by changes in the interest rate. In the above question, the changes in the housing market (because of changing interest rates) are trends within the economic environment. The best answer selection is “D”.

24. Checking Your Knowledge
This slide relates to material on pp
Ford announced that it would begin offering Bluetooth
wireless to help consumers more easily make hands free cell phone calls in their cars. The development of Bluetooth is a significant development in the:
technological environment.
legal environment.
corporate environment.
social environment.
personal environment.
Answer: A
Checking your knowledge (answer explanation):
Advances in the technological environment have made possible an explosion of high-tech products. The development of Bluetooth technology in vehicles is clearly an example of this. The best answer selection is ‘A’.

25. Checking Your Knowledge
This slide relates to material on pp
Many states have appointed or elected commissions that
oversee the business practices of utilities and other
industries that serve the public interest. For a company
operating in one of these industries, dealing with this
important state-level regulatory commission is an
important element of the:
legal environment.
social environment.
monopoly environment.
technological environment.
corporate environment.
Answer: A
Checking your knowledge (answer explanation):
State-appointed commissions that oversee business practices of utilities and other industries that serve the public interest effect companies in these industries. This is part of the legal environment. The best answer selection is ‘A’.

26. The Cultural and Social Environment
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Changes in
Cultural and Social Environment
Summary Overview
The cultural and social environment affects how and why people live and behave as they do.
Key Issues
The changing role of women illustrates the importance of the cultural environment on marketing strategy planning. In the United States, there are:
Greater career opportunities, because more women are in the workforce.
Increased time demands from jobs and careers, so women and their families often suffer from “a poverty of time.”
Discussion Question: What types of products and services are aimed at women and their families who suffer from a poverty of time?
The economic power of women is increasing. More firms are recognizing this fact and designing unique marketing mixes for them.
 Changes in the cultural and social environment tend to come slowly:
Marketers need to identify current attitudes.
Marketers can try to anticipate new trends.
Changing Role of Women
Changes Come Slowly

27. Keeping Competitive in the Social-Cultural Environment
Courtesy of Farmland Dairies
This ad shows how Farmland Dairies is attempting to provide products that will meet the needs of consumers who are concerned about fat and cholesterol in their diets.
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Use the onscreen player controls to operate the video.
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Under certain circumstances, the video may not fill the video player window. To restore, right click the video player object and select Zoom 200%.
The videos will only play in Slide Show View. Macros must be enabled in order to play the videos from within PowerPoint.
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28. Checking Your Knowledge
This slide relates to material on pp
The Federal Trade Commission informed Tropicana that it
would have to stop advertising that one of the benefits of
“heart-healthy” Tropicana orange juice was to lower blood
pressure. For Tropicana, this situation was a significant
development in the:
economic environment.
social environment.
competitive environment.
internal company environment.
legal environment.
Answer: E
Checking your knowledge answer explanation:
The Federal Trade Commission investigates unfair methods of competition. This governmental body operates in the legal environment. ‘E’ is the best answer selection.

29. Screening Criteria Narrow Down Strategies
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Product-Market
Screening Criteria
Qualitative Criteria
Quantitative Criteria
Summary Overview
Successful, innovative firms have strong programs for evaluating opportunities that they identify as a result of scanning the environment. These techniques help them select the opportunities most appropriate for the firm’s particular competitive position.
Key Issues
Marketers must develop and apply screening criteria.
Quantitative criteria include sales, profit, and return on investment goals.
Qualitative criteria summarize what businesses to be in and what strengths and trends to use as a base.
The whole marketing plan should be evaluated.

30. The Total Profit Approach is One Type of Quantitative Screening Criteria (Exhibit 3-6)
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Dollars
Years 1 2 3 4 5
Product A
Years 1 2 3 4 5
Product B
Sales
Sales
Total cost
Summary Overview
A marketing manager using the total profit approach estimates potential sales and costs during the life of a plan. These graphs provide one such estimate for two different products. Product A represents the estimates for a much improved product. And Product B shows a “me-too” product. Product B involves lower initial costs and is profitable more quickly while Product A is not profitable until year 3.
Discussion Question: Consider the graph shown in the slide--which one is the better opportunity for the firm to pursue? Is it Product A or Product B? Why?
A total profit approach can help evaluate possible plans.
Product A has high start-up costs.
Product B earns profits within one year.
If the firm can afford the start-up costs and delayed profits, the long term profit potential for Product A is greater.
Total cost

31. Planning Grids Help Evaluate Portfolio Opportunities (Exhibit 3-7)
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Industry Attractiveness
High
Medium
Low
High
Summary Overview
Graphical planning grids help managers summarize the interaction of several key factors identified by the company to be important to successful business ventures.
Key Issues
General Electric strategic planning grid: positions opportunities according to industry attractiveness and business strength.
Industry attractiveness--characteristics such as size, growth, and competitive structure.
Discussion Question: What characteristics of an industry would be attractive?
Business strength--resources of the organization like people skills, technological position, growth, market share or profitability, among others.
Using industry attractiveness and business strength, a manager can show where any opportunity appears on this grid.
Opportunities occupying the green area of this matrix are growth opportunities and should be pursued. Such opportunities occur in more attractive industries and better fit with the company’s strengths.
Opportunities falling in the red area are ones that the firm should avoid. Such opportunities are perhaps in low growth industries and do not play to the company’s strengths.
In the middle, the yellow areas are borderline opportunities that the firm needs to analyze more fully in order to determine if they are worthwhile. A company may be able to develop a marketing strategy that offsets the lack of strength or low attractiveness in an industry.
Business Strength
Medium
No Growth
Low
Borderline
Growth

32. Multiproduct Firms Have a Difficult Strategy Planning Job
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Multiproduct Firms Have a Difficult Strategy Planning Job
Summary Overview
In addition to planning grids, there are other tools available for evaluating opportunities. The more products and services a firm offers, the greater the task.
Key Issues
Siemens is an example of a multiproduct firm. Strategy planning for firms like Siemens is a complex task.
The idea of a strategic business unit (SBU) may help--an organizational sub-unit of a larger company that focuses on some product-markets and is treated as a separate profit center.
Some firms use portfolio management--treats each SBU like stock in an investor’s portfolio. Some SBUs warrant greater investment, some should be dropped or sold.
The main weakness of this approach is that it encourages management to take a short run view of financial returns.
Discussion Question: How might financial returns and the marketing concept be at odds with each other?

33. Evaluating Opportunities in International Markets (Exhibit 3-8)
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Industrial
products
Consumer products
linked to cultural
variables
Insensitive
Sensitive
Summary Overview
Planning grids and portfolio analysis also apply to international opportunities as well. However, it might be more difficult to be completely familiar with all of the environmental variables at work in foreign countries. The farther one goes from familiar territory, the greater the risk of making big mistakes.
Key Issues
Marketers must evaluate the risks.
Risk assessment varies from market to market.
International markets may be evaluated according to the likelihood of drastic political changes.
Risks tend to vary along a continuum of environmental sensitivity.
 Most industrial products are relatively insensitive to their environment. Industrial firms may find it easier to use the same marketing mix they use in a domestic market in a new international market.
 Consumer products closely linked to other social or cultural variables are very sensitive to their environments. For example, when Disney opened a theme park in France, the parks failed to consider local French customs – such as serving wine with meals. The Euro Disney initially failed to meet its sales goals, but after adding local touches, the park has been more successful.
 Basic commodity-type products may have some sensitivity to the environment – so a marketing mix may require minor changes.
Basic commodity-type consumer products

34. Interactive Exercise: Wheel of Opportunity
The purpose of this exercise is to help students extend their conceptual knowledge of the external marketing environment and the manner in which trends or occurrences within these environments present opportunities or threats. Set in the context of “The Wheel of Opportunity,” students are shown hypothetical or actual trends pertaining to the technological, economic, social, and legal-political environments. Competitive factors are not discussed in the context of this exercise. For each environmental trend or event, students are challenged to identify the product category or industry for which that trend represents the strongest opportunity.
For complete information and suggestions on using this Interactive Exercise, please refer to the “Notes on the Interactive Exercise” section for this chapter in the Multimedia Lecture Support Package to Accompany Basic Marketing. That same information is available as a Word document in the assets folder for the PowerPoint file.

35. You should now be able to:
This slide refers to material on page 60.
Know the variables that shape the environment of marketing strategy planning.
Understand why company objectives are important in guiding marketing strategy planning.
See how the resources of a firm affect the search for opportunities.
Know how the different kinds of competitive situations affect strategy planning.
Understand how the economic and technological environment can affect strategy planning.
You should now be able to:
Know the variables that shape the environment of marketing strategy planning.
Understand why company objectives are important in guiding marketing strategy planning.
See how the resources of a firm affect the search for opportunities.
Know how the different kinds of competitive situations affect strategy planning.
Understand how the economic and technological environment can affect strategy planning.

36. You should now be able to:
This slide refers to material on page 60.
Know why you might be sent to prison if you ignore the political and legal environment.
Understand how to screen and evaluate marketing strategy opportunities.
You should now be able to:
Know why you might be sent to prison if you ignore the political and legal environment.
Understand how to screen and evaluate marketing strategy opportunities.

37. Key Terms Mission statement
This slide refers to boldfaced terms appearing in Chapter 3.
Mission statement
Competitive environment
Competitor analysis
Competitive rivals
Competitive barriers
Economic and technological environment
Technology
Internet
Nationalism
North American Free Trade Agreement (NAFTA)
Cultural and social environment
Sustainability
Strategic business unit (SBU)
Portfolio management
Summary Overview
These are key terms you should be familiar with based upon the material in this presentation.
Key Issues
Mission statement: sets out the organization's basic purpose for being.
Competitive environment: the number and types of competitors the marketing manager must face, and how they may behave.
Competitor analysis: an organized approach for evaluating the strengths and weaknesses of current or potential competitors' marketing strategies.
Competitive rivals: a firm's closest competitors.
Competitive barriers: the conditions that may make it difficult, or even impossible, for a firm to compete in a market.
Economic and technological environment: affects the way firms--and the whole economy--use resources.
Technology: the application of science to convert an economy's resources to output.
Internet: a system for linking computers around the world.
Nationalism: an emphasis on a country's interests before everything else.
North American Free Trade Agreement (NAFTA): lays out a plan to reshape the rules of trade among the U.S., Canada, and Mexico.
Cultural and social environment: affects how and why people live and behave as they do.
Sustainability: the idea that it’s important to meet present needs without compromising the ability of future generations to meet their own needs.
Strategic business unit (SBU): an organizational unit (within a larger company) that focuses its efforts on some product‑markets and is treated as a separate profit center.
Portfolio management: treats alternative products, divisions, or strategic business units (SBUs) as though they are stock investments to be bought and sold using financial criteria.