Principles of Marketing
15th ed
Philip Kotler, Gary Armstrong
CHAPTER THREE
Analyzing the Marketing
Environment
Lecturer: Emran Mohammad
Mkt 202 Sec 3,4
0
Ch 1
Ch 3 -0
-1 Copyright © 2011 Pearson Education
Chapter
Topic Outline
Learning Outcomes
3.1 The Company’s Microenvironment
3.2 The Company’s Macroenvironment
3.3 Demographic Environment
3.4 Economic Environment
3.5 Natural Environment
3.6 Technological Environment
3.7 Political and Social Environment
3.8 Cultural Environment
3.9 Responding to the Marketing Environment
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The Marketing Environment
The marketing environment includes the actors and forces outside
marketing that affect marketing management’s ability to build and maintain
successful relationships with customers.
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The Company’s Microenvironment
A microenvironment consists of the actors close to the company that
affect its ability to serve its customers, the company, suppliers, marketing
intermediaries, customer markets, competitors, and publics.
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The Company’s Microenvironment
The Company
Top management
Finance
R&D
Purchasing
Operations
Accounting
The Company’s Microenvironment
Suppliers
Provide the resources to produce goods and
services
Treated as partners to provide customer value
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The Company’s Microenvironment
Marketing Intermediaries
Marketing Intermediaries help the company to
promote, sell and distribute its products.
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The Company’s Microenvironment
Competitors
Firms must gain
strategic
advantage by
positioning their
offerings against
competitors’
offerings.
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The Company’s Microenvironment
Publics are any groups that have an actual or potential
interest in or impact on an organization’s ability to achieve its
objectives. They include:
Financial publics
• Media publics
• Government publics
• Citizen-action publics
• Local publics
• The general public
• Internal publics
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The Company’s Macroenvironment
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Demographic Environment
Demography
Demography is the study of human populations in
terms of size, density, location, age, gender, race,
occupation, and other statistics.
The demographic environment is important because it
involves people, and people make up markets.
Demographic trends include age, family structure,
geographic population shifts, educational
characteristics, and population diversity.
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Demographic Environment
Increased Diversity
Markets are becoming more diverse
• International
• National
Includes:
• Ethnicity
• Language
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Economic Environment
Economic Environment
The economic environment consists of
factors that affect consumer purchasing power
and spending patterns.
Industrial economies are richer markets.
Subsistence economies consume most of their
own agriculture and industrial output.
Changes in consumer spending
Income distribution
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Economic Environment
Changes in Income
Value marketing involves ways to offer
financially cautious buyers greater
value—the right combination of quality
and service at a fair price.
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Natural Environment
The natural environment involves the
natural resources that are needed as inputs by
marketers, or that are affected by marketing
activities.
Trends
Shortages of raw materials
Increased pollution
Increase government intervention
Environmentally sustainable strategies
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Technological Environment
The technological environment is the
most dramatic force in changing the
marketplace.
•One of the most dramatic forces shaping
our destiny
•It creates new products and opportunities.
• Safety of new product always a concern.
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Political Environment
The political environment consists of laws,
government agencies, and pressure groups that
influence or limit various organizations and
individuals in a given society.
Legislation Regulating Business
Increased legislation steadily over the years globally
Changing government agency enforcement
Business Legislation has been enacted for
• Protect companies from each other
• Protect consumers from unfair business practice
• Protect the interest of the society against unrestrained
business behavior
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Political Environment
Increased Emphasis on Ethics and Socially Responsible
Actions
Socially responsible behavior
Enlightened companies encourage their managers to work
beyond what the regulatory system allows and simply do the
right thing
Many companies are now developing policy guideline and
other responses to complex social responsibility issues
Cause-related marketing
Many companies are now linking themselves to worthwhile
causes
E.g. Toyota campaign of 100 cars
E.g. The P&G Tide loads of hope program
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Cultural Environment
The Cultural environment consists of institutions and other forces
that affect a society’s basic values, perceptions, and behaviors.
Persistence of Cultural Values
Core beliefs and values are persistent and are passed on from
parents to children and are reinforced by schools, mosques, businesses,
and governments.
Secondary beliefs and values are more open to change and
include people’s views of themselves, others, organizations, society,
nature, and the universe.
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Cultural Environment
Shifts in Secondary Cultural Values
People’s view of themselves
People’s view of others
People’s view of organizations
People’s view of society
People’s view of nature
People’s view of the universe
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Thank you
