Scanning The Marketing Environment
By: Agung Utama
Kotler on marketing : “ Today, you have to
run faster to stay in the same place”.
Successful companies take an outsideinside view of their business.
They recognize that the marketing
environment is constantly presenting new
opportunities and threats.
They understand the importance of
continuously monitoring and adapting to
that environment.
Successful companies recognize and
respond profitably to unmet needs and
trends.
Companies could make a fortune if they
could solve any of this problem: a cure for
cancer, chemical cures for mental diseases,
desalinization of seawater, etc.
Many opportunities are found by identifying
trends.
A trends is a direction or sequence of events that
has some momentum and durability (Kotler) or a
gradual, long-term up or down movement of
demand (Russel).
A new product or marketing program is likely to
be more successful if it is in line with strong
trends rather than opposed to them.
For example : the percentage of people who
value physical fitness and well being has risen
steadily over the years, especially in the under 30
group, the young women and people living in the
west. Marketers of health foods and exercise
equipment capture to this trend with appropriate
products and communications.
Macro environment forces and trends shape
opportunities and threats for the company, marketing
intermediaries, customers, competitors and publics.
The company must monitor and respond to the forces
of macro environment because it represents “ non
controllable forces”.
It is including:
1. Demographic environment
2. Economic environment
3. Natural environment
4. Technological environment
5. Political legal environment
6. Socio-cultural environment
Demographic environment
1.
•
World wide population growth :
The world population is showing explosive
( totaled 6.1 billion in 2000 and will exceed 7.9
billion by the year 2025)
It can be source of major concern:
Certain resources are limited and may run out at
some point.
It is highest in countries and communities that can
least afford it.
Explosive population growth does not mean
growing market unless have sufficient purchasing
power, nonetheless companies that carefully
analyze their market can find major opportunities.
Population age mix
National populations vary in their age mix.
Mexico, has a very young population and rapid
population growth, at the other hand, Japan, a
country with one of the world oldest population.
Milk, diapers, school supplies, and toys would
be important product in Mexico, while adult
products would be important in Japan.
A population can be subdivided into six age
groups: pre school, school-age children, teens,
young adults (age 25 to 40), middle-aged adults
(age 40 to 65), and older adults age ( age 65
and up).
For marketers, the most populous age groups
shape the marketing environment.
•
Ethnic and other markets
Countries vary in ethnic and racial markets.
at one extreme is Japan, where almost every one is
Japanese; at the other is USA, which is consists of 72
% white, African American 13 % and Latinos 11 %.
Each group has certain specific wants and buying
habits.
Yet, marketers must be careful not to
overgeneralize about ethnic groups.
Educational levels
The population classified into 5 educational groups:
illiterates, high school dropouts, high school
degrees, college degrees, and professional degrees.
Each groups has certain specific wants and
individual ability.
House hold pattern
The traditional household consists of a husband,
wife, and children ( and some times grand
parents).
Yet, in USA, one out of eight households is
“diverse or non traditional “ includes: single lives
alone, adult live-togethers of one or both sexes,
single parents families, childless married couples,
and empty nesters. More people are divorcing or
separating, choosing not to marry, marrying later,
or marrying without to have children.
Each groups has a distinctive set of needs and
buying habits.
2.
Economic environment
Markets require purchasing power as well as
people.
The purchasing power depends on :
Current income
Prices
savings,
Debt and credit availaibility.
Marketers must pay close attention to major
trends in income and consumer-spending
behavior.
Marketers often distinguish countries with five
different income distribution patterns : very
low incomes, mostly low incomes, very lowvery high incomes, low, medium, high
incomes, and mostly medium incomes.
Savings, debt, and credit availability.
Consumers expenditures are affected by
savings, debt, and credit availability.
The Japanese save about 13.1 % of their
income, other wise, US consumers about 4.7%.
The result has been that Japanese banks were
able to loan money to Japanese companies at a
much lower interest rate than US bank, so
Japanese companies expand faster.
The bottom line is that marketers must pay
careful attention to major changes in incomes,
cost of living, interest rates, savings, and
borrowing patterns because they can have a
strong impact on business.
3.
Natural environment
• The marketers need to be aware of the threats and
opportunities associated with four trends in natural
environment;
4.
Shortage of raw materials
Increased energy cost
Anti-pollution pressures
Changing role of governments.
Technological environment
• One of the most dramatic forces shaping people’
lives is technology
• Technology has released such wonders as penicillin,
open heart surgery, the birth control pill.
• It has released such horrors as hydrogen bomb,
nerve gas, submachine gun.
• Every technology is a force for “creative
destruction” such as autos hurt the rail roads, and
television hurt the newspaper.
The economy’s growth rate is affected by
how many major new technologies are
discovered.
New technology also creates major long
run consequences that are not always
foreseeable. The contraceptive pill, led to
smaller families, more working wives, and
larger discretionary incomes, resulting in
high expenditures on vacation travel,
durable goods and luxury items.
The marketer should monitor the following
trends in technology: the pace of change,
the opportunities for innovation, varrying
R&D budgets, and increased regulation.
5.
Political legal environment
•
This environment is composed of laws, government agencies,
and pressure groups that influence and limit various organizatio
and individuals.
•
Business regulation
Business regulation has three main purposes: to protect
business from : 1)unfair competition, 2) unfair business
practices and 3) to protect the interests of society from
unbridled business behavior.
Marketers must have a good working knowledge of the major
laws protecting competition, consumers, and society.
•
Growth of special interest groups.
An important force affecting business is the consumerist
movement, an organized movements of citizens and
government to strengthen the rights and power of buyers in
relation to sellers.
The consumerists has advocated the true interests cost of
loan, unit pricing, the basic ingredients in a product, the
nutritional quality of foods, the freshness of product, and the
true benefits of a product.
Socio-cultural environment
6.
•
High persistence of core cultural values.
The people living in a particular society hold many core
beliefs and values that tend to persist. Most American
still believe in work, in getting married and in being
honesty.
Core beliefs and values are passed on from parents to
children and are reinforced by major institutions:
schools, churches, mosque, business, and
governments.
Secondary beliefs and values are more open to change.
Believing in the institution of marriage is a core belief,
believing that people ought to get married early is a
secondary beliefs.
Marketers have some chance of changing secondary
values but little chance of changing core values.
Kotler on marketing : “ Today, you have to
run faster to stay in the same place”.
Successful companies take an outsideinside view of their business.
They recognize that the marketing
environment is constantly presenting new
opportunities and threats.
They understand the importance of
continuously monitoring and adapting to
that environment.
Successful companies recognize and
respond profitably to unmet needs and
trends.
Companies could make a fortune if they
could solve any of this problem: a cure for
cancer, chemical cures for mental diseases,
desalinization of seawater, etc.
Many opportunities are found by identifying
trends.
A trends is a direction or sequence of events that
has some momentum and durability (Kotler) or a
gradual, long-term up or down movement of
demand (Russel).
A new product or marketing program is likely to
be more successful if it is in line with strong
trends rather than opposed to them.
For example : the percentage of people who
value physical fitness and well being has risen
steadily over the years, especially in the under 30
group, the young women and people living in the
west. Marketers of health foods and exercise
equipment capture to this trend with appropriate
products and communications.
Macro environment forces and trends shape
opportunities and threats for the company, marketing
intermediaries, customers, competitors and publics.
The company must monitor and respond to the forces
of macro environment because it represents “ non
controllable forces”.
It is including:
1. Demographic environment
2. Economic environment
3. Natural environment
4. Technological environment
5. Political legal environment
6. Socio-cultural environment
Demographic environment
1.
•
World wide population growth :
The world population is showing explosive
( totaled 6.1 billion in 2000 and will exceed 7.9
billion by the year 2025)
It can be source of major concern:
Certain resources are limited and may run out at
some point.
It is highest in countries and communities that can
least afford it.
Explosive population growth does not mean
growing market unless have sufficient purchasing
power, nonetheless companies that carefully
analyze their market can find major opportunities.
Population age mix
National populations vary in their age mix.
Mexico, has a very young population and rapid
population growth, at the other hand, Japan, a
country with one of the world oldest population.
Milk, diapers, school supplies, and toys would
be important product in Mexico, while adult
products would be important in Japan.
A population can be subdivided into six age
groups: pre school, school-age children, teens,
young adults (age 25 to 40), middle-aged adults
(age 40 to 65), and older adults age ( age 65
and up).
For marketers, the most populous age groups
shape the marketing environment.
•
Ethnic and other markets
Countries vary in ethnic and racial markets.
at one extreme is Japan, where almost every one is
Japanese; at the other is USA, which is consists of 72
% white, African American 13 % and Latinos 11 %.
Each group has certain specific wants and buying
habits.
Yet, marketers must be careful not to
overgeneralize about ethnic groups.
Educational levels
The population classified into 5 educational groups:
illiterates, high school dropouts, high school
degrees, college degrees, and professional degrees.
Each groups has certain specific wants and
individual ability.
House hold pattern
The traditional household consists of a husband,
wife, and children ( and some times grand
parents).
Yet, in USA, one out of eight households is
“diverse or non traditional “ includes: single lives
alone, adult live-togethers of one or both sexes,
single parents families, childless married couples,
and empty nesters. More people are divorcing or
separating, choosing not to marry, marrying later,
or marrying without to have children.
Each groups has a distinctive set of needs and
buying habits.
2.
Economic environment
Markets require purchasing power as well as
people.
The purchasing power depends on :
Current income
Prices
savings,
Debt and credit availaibility.
Marketers must pay close attention to major
trends in income and consumer-spending
behavior.
Marketers often distinguish countries with five
different income distribution patterns : very
low incomes, mostly low incomes, very lowvery high incomes, low, medium, high
incomes, and mostly medium incomes.
Savings, debt, and credit availability.
Consumers expenditures are affected by
savings, debt, and credit availability.
The Japanese save about 13.1 % of their
income, other wise, US consumers about 4.7%.
The result has been that Japanese banks were
able to loan money to Japanese companies at a
much lower interest rate than US bank, so
Japanese companies expand faster.
The bottom line is that marketers must pay
careful attention to major changes in incomes,
cost of living, interest rates, savings, and
borrowing patterns because they can have a
strong impact on business.
3.
Natural environment
• The marketers need to be aware of the threats and
opportunities associated with four trends in natural
environment;
4.
Shortage of raw materials
Increased energy cost
Anti-pollution pressures
Changing role of governments.
Technological environment
• One of the most dramatic forces shaping people’
lives is technology
• Technology has released such wonders as penicillin,
open heart surgery, the birth control pill.
• It has released such horrors as hydrogen bomb,
nerve gas, submachine gun.
• Every technology is a force for “creative
destruction” such as autos hurt the rail roads, and
television hurt the newspaper.
The economy’s growth rate is affected by
how many major new technologies are
discovered.
New technology also creates major long
run consequences that are not always
foreseeable. The contraceptive pill, led to
smaller families, more working wives, and
larger discretionary incomes, resulting in
high expenditures on vacation travel,
durable goods and luxury items.
The marketer should monitor the following
trends in technology: the pace of change,
the opportunities for innovation, varrying
R&D budgets, and increased regulation.
5.
Political legal environment
•
This environment is composed of laws, government agencies,
and pressure groups that influence and limit various organizatio
and individuals.
•
Business regulation
Business regulation has three main purposes: to protect
business from : 1)unfair competition, 2) unfair business
practices and 3) to protect the interests of society from
unbridled business behavior.
Marketers must have a good working knowledge of the major
laws protecting competition, consumers, and society.
•
Growth of special interest groups.
An important force affecting business is the consumerist
movement, an organized movements of citizens and
government to strengthen the rights and power of buyers in
relation to sellers.
The consumerists has advocated the true interests cost of
loan, unit pricing, the basic ingredients in a product, the
nutritional quality of foods, the freshness of product, and the
true benefits of a product.
Socio-cultural environment
6.
•
High persistence of core cultural values.
The people living in a particular society hold many core
beliefs and values that tend to persist. Most American
still believe in work, in getting married and in being
honesty.
Core beliefs and values are passed on from parents to
children and are reinforced by major institutions:
schools, churches, mosque, business, and
governments.
Secondary beliefs and values are more open to change.
Believing in the institution of marriage is a core belief,
believing that people ought to get married early is a
secondary beliefs.
Marketers have some chance of changing secondary
values but little chance of changing core values.