Chapter Three
Analyzing the Marketing Environment
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Analyzing the Marketing
Environment
Topic Outline
• The Companyʼs Microenvironment
• The Companyʼs Macroenvironemnt
• Responding to the Marketing Environment
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Analyzing the Marketing Environment
Microsoft: Adapting to the Fast-Changing
Marketing Environment
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The Marketing Environment
The marketing environment includes the
actors and forces Uncontrollable
outside marketing
that affect marketing
Controllable
managementʼs ability
to build and maintain
successful relationships
with customers
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The Marketing Environment
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 Micro
Environment
Actors in the Microenvironment
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The Companyʼs Microenvironment
The Company
• Top management
• Finance
• R&D
• Purchasing
• Operations
• Accounting
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The Companyʼs Microenvironment
Suppliers
• Provide the resources to produce goods
and services
• Treated as partners to provide customer
value
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The Companyʼs Microenvironment
Marketing Intermediaries
Help the company to Partnering with intermediaries:
Coca-Cola provides its retail
promote, sell and distribute partners with much more than just
soft drinks. It also pledges powerful
its products to final buyers marketing support.
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The Companyʼs Microenvironment
Types of Marketing Intermediaries
Physical
Resellers distribution
firms
Marketing
Financial
services
intermediaries
agencies
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The Companyʼs Microenvironment
Competitors
• Firms must gain strategic advantage by
positioning their offerings against
competitorsʼ offerings
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The Companyʼs Microenvironment
Publics: P&G has a long history of giving
back to its local publics. The Tide Loads Publics
of Hope program brings “hope not just
soap” in the form of free mobile laundry • Any group that has an actual or
services to people in communities facing potential interest in or impact on
natural disasters.
an organizationʼs ability to
achieve its objectives
– Financial publics
– Media publics
– Government publics
– Citizen-action publics
– Local publics
– General public
– Internal publics
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The Companyʼs Microenvironment
Customers
• Consumer markets
• Business markets
• Reseller markets
• Government markets
• International markets
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The Companyʼs
Macroenvironment
The Companyʼs
Macroenvironment
Demographic Environment
Demography is the study of human populations
in terms of size, density, location, age, gender,
race, occupation, and other statistics
• 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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The Companyʼs
Macroenvironment
Demographic Environment
Generational marketing is important in
segmenting people by lifestyle or life
stage instead of age
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The Demographic and Economic
Environments
The Demographic Environment
• Baby Boomers – born 1946 to 1964
• Generation X – born between 1965 and 1980
• Millennials – born between 1981 and 1996
• Generation Z – born between 1997 and 2012
• Generation Alpha – born after 2012
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The Companyʼs
Macroenvironment
The Demographic Environment
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The Companyʼs
Macroenvironment
The Demographic Environment
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The Companyʼs
Macroenvironment
Demographic Environment
More people are:
• Divorcing or separating
• Choosing not to marry
• Choosing to marry later
• Marrying without intending to have
children
• Increased number of working women
• Stay-at-home dads
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The Companyʼs
Macroenvironment
Demographic Environment
• Moving from rural to
metropolitan areas
• Changes in where people work
– Telecommuting
– Home office
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The Companyʼs
Macroenvironment
Demographic Environment
Changes in the Workforce
– More educated
– More white collar
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The Companyʼs
Macroenvironment
Demographic Environment
Increased Diversity
Markets are becoming more diverse
– International
– National
• Includes:
– Ethnicity
– LGBTQ+
– Disabled
Targeting consumers with disabilities:
Toyota’s “Start Your Impossible” campaign
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The Companyʼs
Macroenvironment
Economic Environment
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
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The Companyʼs
Macroenvironment
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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The Companyʼs
Macroenvironment
Natural Environment
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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The Companyʼs
Macroenvironment
Natural Environment
LUSH has tried to advocate sustainability through its own
practices and its impact on the actions of its value chain.
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The Companyʼs
Macroenvironment
Technological Environment
• Most dramatic force in
changing the marketplace
• Creates new products and
opportunities
• Concern for the safety of
new products
Disney takes full advantage of digital
technology in creating magical
customer experiences at its Walt
Disney World Resort.
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The Companyʼs
Macroenvironment
Political Environment
Political environment consists of laws,
government agencies, and pressure groups
that influence or limit various organizations
and individuals in a given society
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The Companyʼs
Macroenvironment
Political Environment
Legislation regulating business is
intended to protect
• companies from each other
• consumers from unfair
business practices
• the interests of society against
unrestrained business
behavior
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The Companyʼs
Macroenvironment
Cultural Environment
Cultural environment consists of institutions
and other forces that affect a societyʼs
basic values, perceptions, and behaviors
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Cultural Environment
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The Companyʼs
Macroenvironment
Cultural Environment
Persistence of Cultural Values
Core beliefs and values are persistent and are
passed on from parents to children and are
reinforced by schools, churches, businesses,
and government
Secondary beliefs and values are more open to
change and include peopleʼs views of
themselves, others, organization, society,
nature, and the universe
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The Political-Social and Cultural
Environments
The Cultural Environment Catering to the natural, organic, and
Shifts in Secondary Cultural Values ethical products trend: Unilever’s
Love Beauty and Planet brand has
• People’s views of themselves
one goal: “To make you more
• People’s views of others beautiful and give a little love to our
• People’s views of organizations planet.”
• People’s views of society
• People’s views of nature
• People’s views of the universe
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The Companyʼs
Macroenvironment
Cultural Environment
Shifts in Secondary Cultural Values
• Peopleʼs view of themselves
• Peopleʼs view of others
– Less interaction outside
– More communication online more
than ever
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The Companyʼs
Macroenvironment
Cultural Environment
Shifts in Secondary Cultural Values
• Peopleʼs view of organizations
- Work for major organizations
- Expect them to carry out society’s work
- Decline in organizational loyalty
• Peopleʼs view of society
– Patriots defend it
– Reformers want to change it
– Malcontents want to leave it
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The Companyʼs
Macroenvironment
Cultural Environment
Shifts in Secondary Cultural Values
• Peopleʼs view of nature
– Some feel ruled by it
– Some feel in harmony with it
– Some seek to master it
• Peopleʼs view of the universe
– Renewed interest in spirituality
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Responding to the Marketing
Environment
Views on Responding
Uncontrollable Proactive Reactive
• React and • Aggressive • Watching
adapt to actions to and reacting
forces in the affect forces to forces in
environment in the the
environment environment
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Group Discussion
PESTLE Analysis for Industry Trends
Activity:
- Each group chooses a brand/company in a specific industry.
- Analyze and present PESTLE analysis (Political, Economic, Social,
Technological, Legal, Environmental) to identify external factors
impacting that industry.
Outcome: Encourages students to understand how macro-environmental
factors shape business strategies.
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