1. Chapter Three
Evaluating Opportunities in the Changing Marketing Environment
Chapter 3
Evaluating Opportunities in the Changing Marketing Environment
For use only with Perreault/Cannon/McCarthy or Perreault/McCarthy texts. © 2011 McGraw-Hill Companies, Inc. McGraw-Hill/Irwin
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Lecture Script 3-1

2. At the end of this presentation, you should be able to:
This slide refers to material on pp.58.
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.
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3. At the end of this presentation, you should be able to:
This slide refers to material on pp.58.
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.
Understand the important new terms.
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.
Understand the important new terms.
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4. The Marketing Environment
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Marketing Strategy Planning Process
Summary Overview
The narrowing-down process should consider the important elements of the market environment and how they are shifting.
Key Issues:
The marketing strategy planning process requires:
Narrowing down to the best opportunities.
Developing a strategy that:
Gives the firm a competitive advantage.
Provides target customers with superior customer value.
Narrowing down to the best opportunities
Developing a strategy
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5. The Marketing Environment (How can a marketer influence but not directly control the 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
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6. 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
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7. Hierarchy of Objectives (company objects provide larger framework for the functional areas to work toward the same objectives; marketing objects guide development of objectives for the marketing mix)
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Production Objectives
Production Objectives
Product Objectives
Product Objectives
Personal Selling Objectives
Finance Objectives
Finance Objectives
Place Objectives
Place Objectives
Company 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?
Marketing Objectives
Mass Selling Objectives
Promotion Objectives
HR Objectives
HR Objectives
R&D Objectives
R&D Objectives
Price Objectives
Price Objectives
Sales Promotion Objectives
IT Objectives
IT Objectives
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8. Company Resources May Limit Search for Opportunities
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Financial Strength
(some opportunities require more capital)
Producing Capability and Flexibility
(skills needed for a particular opportunity)
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.
Collaborators can help offset weaknesses
The knowledge of people at the firm can also be a unique resource.
By analyzing successes or failures in relation to thefirm’s resources, management can discover why the firm was successful—or why it failed—in the past.
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? 
Marketing Strengths
(e.g., familiar brand; channel relations; sales-force)
Collaborators can Help
Offset weaknesses
(review past success and failures)
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9. Examples of Company Resources
Financial strength (Intel)
Producing flexibility (DaimlerChrysler)
Patents (IBM)
Channel relationships (Kraft)
Loyal customer base (Starbucks)
Technical capability (3M)

10. Marketing Strengths This slide relates to material on pp. 62.
Summary Overview
A major marketing strength for many companies is a familiar brand name like Aveeno.
Key Issues
Major thrust of this ad is the promotion of New Aveeno Daily Moisturizing Body Wash.
New Aveeno Daily Moisturizing Body Wash replenishes skin’s natural moisture.
Aveeno brand has been recommended by dermatologists for 60 years.
This ad highlights the main benefits of the product: Soft, smooth, and healthy skin all day.
Discussion Question: What other marketing strengths does Aveeno have, in addition to a strong brand name?
"Used with permission of the copyright owner."
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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
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12. Competitive Advantage
This slide relates to material on pp. 64.
Competitive Advantage
Summary Overview
There are few producers of Mini Waterless Vaporizer. SudaCare 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, SudaCare Mini Waterless Vaporizer attempts to avoid head-on competition by providing the following benefits to the customers:
Contains a blend of aromatic ingredients, including menthol and eucalyptus
Helps comfortably relieve congestion; easy-to-replace refill pads last up to 8 hours
Convenient and simple to use--just plug in!
Continuous 8-hour release
Discussion Question: How can SudaCare be innovative when dealing in an competitive product-market against other vaporizers? What types of issues might be important to customers buying SudaCare Mini Waterless Vaporizer from a medical or a departmental store?
Courtesy of Pfizer Consumer Healthcare, Pfizer Inc.
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13. Avoiding Head-On Competition
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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 Competitors to Find a Competitive Advantage
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Competitor Analysis
evaluating the strengths and weaknesses of current or potential competitors' marketing strategies.
Competitive Rivals
firms that will be the closest competitors
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
conditions that make it difficult or impossible for a firm to compete in a given market.
Competitive Advantage
new or better ways to satisfy customer needs and provide better value than the competition.
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15. Marketers Need Information about Competitors
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Seek Information About Competitors
Is there anything wrong with having computer hackers break into a competitor’s computer system to access information?
Summary Overview
Marketing managers should seek out information on competitive practices.
Key Issues
The search for information raises ethical issues.
Discussion Questions:
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?
Ethical Issues
Should people who go to work for their former competitors use information they gained from their previous employers?
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16. Checking Your Knowledge
This slide relates to material on pp. 64.
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:
A. pure competition.
B. monopoly.
C. oligopoly.
D. monopolistic competition.
E. 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.2
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17. Checking Your Knowledge
This slide relates to material on pp. 66.
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:
A. competitive opportunity.
B. monopoly.
C. competitive barrier.
D. opportunity.
E. 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.
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18. The Economic Environment affects the way firms and the whole economy use resources
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Global Economy (increasing connected)
Rapid Change (economic environment)
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 (affect buying consumer processes

19. Examples of Effect of Technological Environment
Rapid changes in the Internet and World Wide Web
Robotics (better quality control, lower production costs)
Networked computer scanners at retail check-out counters
Worldwide satellites for data communication
Automated inventory control
Hybrid engines for vehicles
New drugs based on knowledge of genes

20. The Technological Environment (Technology is the application of science to convert an economy’s resources to output)
This slide relates to material on pp
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
Technology transfer is rapid from one country to the next.
Internet technologies are reshaping marketing.
The Internet changes based on the way consumers shop and marketers market.
Discussion Question: In what other ways has the Internet affected marketing? Hint—think about each of the 4Ps.
Technology poses challenges.
Sometimes, new technological breakthroughs are rushed to market. Technology also speeds up obsolescence.
Technology has raised ethical issues about the privacy of personal information, ecological concerns, and the intrusiveness of telemarketing and Internet advertising.
(Video clip length 1:54)
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21. The Political Environment
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Examples of
Characteristics of the Political Environment
Regional Economic Groupings (European Union; NAFTA)
Nationalism (emphasis on a country’s interest)
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.

22. Examples of Changes in the Political/Legal Environment
Deregulation of energy industries
Less emphasis on antitrust laws by federal government
Maturing of consumerism
More attention to laws governing international trade
Changes in labeling requirements
Increased concern about consumer privacy

23. The Legal Environment – Key Antimonopoly Laws
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Sherman Act (1890) prohibits price fixing
Clayton Act
(1914) Prohibits limiting buyers source of supply
Magnuson-Moss Act (1975) product warranties/unreasonable practices
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?
Federal Trade Commission (1914) prohibits deceptive advertising
Antimerger Act (1950) Buying competitors
Wheeler-Lea Amendment (1938) Deceptive packaging or branding
Robinson-Patman Act (1936) price related discrimination
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24. The Legal Environment – Consumer Protection Agencies
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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.
Marketers must know the laws.
For example, regulation was lax in the 1980s but stricter in the 1990s. In the early 2000s, the pendulum reversed itself again.
Laws and enforcement differ across countries
Because legal environments are closely tied to national governments, laws and enforcement vary significantly around the world.
Discussion Question: What are some areas of consumer protection that are of current interest to the courts and to political leaders?
Food and Drug Administration (FDA) Enforces laws and develops regulations to prevent distribution and sale of adulterated or misbranded foods, drugs, cosmetics, and hazardous consumer products
Consumer Product Safety Commission (CPSC) Enforces the Consumer Product Safety Act—which covers any consumer product not assigned to other regulatory agencies
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25. Checking Your Knowledge
This slide relates to material on pp. 67.
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:
A. competitive environnent.
B. technological environment.
C. cultural environment.
D. economic environment.
E. 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”.
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26. Checking Your Knowledge
This slide relates to material on pp. 69.
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’.
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27. Checking Your Knowledge
This slide relates to material on pp. 72.
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’.
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28. 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 (more career opportunities)
Changes Come Slowly (cultural values persists)

29. Examples of Trends in the Cultural Environment
More women in the work force
Aging of America, but accompanied by new growth in ethnic groups
More single-person households
More health consciousness
More concern about the environment

30. Keeping Competitive in the Social-Cultural Environment
This slide relates to material on pp
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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31. Checking Your Knowledge
This slide relates to material on pp. 72.
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.
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32. The Cultural and Social Environment
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Product-Market
Screening 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.
Qualitative Criteria
(what businesses to be in and what strengths and trends to use as a base)
Quantitative Criteria
(sales, profit, and return on investment goals)
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33. Multimedia Lecture Support Package to Accompany Basic Marketing
The Total Profit Approach is One Type of Quantitative Screening Criteria
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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.
Return-on-investment (ROI) approach can help evaluate possible plans too
ROI analyses can be useful for selecting among possible plans because equally profitable plans may require vastly different resources and offer different rates of return on investment.
Total cost
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34. GE’s Strategic Planning Grid
A way of organizing business judgments about existing and/or proposed product-market plans
Business Strengths Dimension
Company size, market share
Profit margins
Technology position
Limiting factors (personnel, capital needed, etc.)
Industry Attractiveness Dimension
Size of market and growth trends
Competitive situation
Social impact
Industry profitability

35. Planning Grids Help Evaluate Portfolio Opportunities
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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
Multimedia Lecture Support Package to Accompany Basic Marketing
Lecture Script 3-35

36. Evaluating Opportunities in International Markets
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Indicates place where slide “builds” to include the corresponding point (upon mouse click).
Industrial
products
Consumer products
linked to cultural
variables
Sensitive
Insensitive
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.
If risks are still hard to judge?
If the risks of an international opportunity are hard to judge, it may be wise to look first for opportunities that involve exporting.
Basic
commodity-type consumer products
Multimedia Lecture Support Package to Accompany Basic Marketing
Lecture Script 3-36

37. Interactive Exercise: Wheel of Opportunity
This slide relates to material on pp. 58.
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.
Multimedia Lecture Support Package to Accompany Basic Marketing
Lecture Script 3-37

38. Study Question 1
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The marketing manager for a financial services firm knows that customer preferences for mutual funds and bond accounts will differ depending on the current interest rate. She must plan her offerings with the _____ environment in
mind.
  A. economic B. social C. technological D. cultural E. legal
Answer: A
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.

39. Study Question 2
This slide relates to material on pp
Which of the following is NOT an example of how the technological environment might affect marketing management?
  A. A manufacturer uses a computer to send orders directly to a supplier's computer. B. A retailer installs a computerized checkout scanner to replace a manual cash register system. C. A firm develops a substitute for saturated fat in manufactured foods. D. All of the above are examples. E. None of the above is an example.
Answer: D
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.

40. Study Question 3
This slide relates to material on pp
The largest producer of "fuzz-busters" (radar detectors) sees that many states are increasing the penalty for using them. Clearly, this firm's marketing strategy may have to change in response to these changes in the 
A. economic and technological environment. B. resources and objectives of the firm. C. competitive environment. D. political and legal environment. E. cultural and social environment.
Answer: D
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.

41. Study Question 4
This slide relates to material on pp
Which of the following newspaper headlines is MOST LIKELY to be a result of changes in the cultural and social environment? 
A. "McDonald's Changes Its Menu to Cater to Low-Carb Dieters." B. "General Motors Offers Original Equipment Car Stereos with Satellite Radio Service." C. "Treasury Department Introduces New Currency to Combat Counterfeiters." D. "New Projection TVs Are Thinner, Lighter that Traditional TVs" E. "Gasoline Prices Increase Sharply."
Answer: A
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.

42. Study Question 5
This slide relates to material on pp
More women working outside the home and greater interest in leisure are examples of changes in the ______________ environment. 
A. technological. B. cultural and social. C. economic. D. legal. E. competitive.
Answer: B
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.