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Marketing : An Introduction
An Asian Perspective
Armstrong, Kotler
& da Silva
3
The Marketing
Environment
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-1
Marketing Environment
• The marketing environment consists of actors
and forces outside the organization that affect
management’s ability to build and maintain
relationships with target customers.
• Environment offers both opportunities and
threats.
• Marketing intelligence and research used to
collect information about the environment.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-2
Marketing Environment
• Includes:
– Microenvironment: actors close to the
company that affect its ability to serve its
customers.
– Macroenvironment: larger societal forces
that affect the microenvironment.
• Considered to be beyond the control of the
organization.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-3
Actors in the Microenvironment
Figure 3.3
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Marketing : An Introduction
An Asian Perspective
3-4
The Company’s Microenvironment
• The Company
– Areas inside a company.
– Affects the marketing department’s
planning strategies.
– All departments must “think consumer”
and work together to provide superior
customer value and satisfaction.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-5
The Internal Environment
Figure 3.4
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Marketing : An Introduction
An Asian Perspective
3-6
The Company’s Microenvironment
• Suppliers:
– Provide resources
needed to produce
goods and services.
– Important link in the
“value delivery
system.”
– Most marketers treat
suppliers like partners.
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Marketing : An Introduction
An Asian Perspective
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The Company’s Microenvironment
• Marketing Intermediaries:
– Help the company to promote, sell, and
distribute its goods to final buyers
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries
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Marketing : An Introduction
An Asian Perspective
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Resellers
• Resellers are distribution channel firms
that help the company to find its
customers or make sales to them.
• These include wholesalers and retailers
who buy and resell merchandise.
• Big C, Carrefour, Tesco Lotus etc. are
examples of big retailers.
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Marketing : An Introduction
An Asian Perspective
3-9
Partnering With Intermediaries
Coca-Cola provides
McDonalds with much
more than just soft
drinks. It also pledges
powerful marketing
support.
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Marketing : An Introduction
An Asian Perspective
3-10
Physical distribution firms
• Physical distribution firms
help the company to stock
and move goods from their
points of origin to their
destinations.
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Marketing : An Introduction
An Asian Perspective
3-11
Marketing Service Agencies
Marketing services Agencies are the
marketing research firms that help the
company target and promote its
products to the right market.
Acorn Marketing and Research
Consultants Co. Ltd
Research Dynamics Co. Ltd.
TNS Research International
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-12
Financial intermediaries
• Financial intermediaries include banks,
credit companies, insurance companies
and other businesses that help the finance
transactions or insure against risks
associated with the buying and selling
goods
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-13
The Company’s Microenvironment
• Customers:
– Five types of markets that purchase a
company’s goods and services
– Consumer markets
– Business markets
– Reseller markets
– Government markets
– International markets
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Marketing : An Introduction
An Asian Perspective
3-14
Consumer markets
• Consumer market
consists of
individuals and
households that
buy goods and
services for
personal
consumption.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-15
Business markets
• Business markets
buy goods and
services for further
processing or for
use in their
production
process.
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Marketing : An Introduction
An Asian Perspective
3-16
Reseller markets
• Reseller markets
buy goods and
services to resell at
a profit.
– Retailers
– Wholesalers
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-17
Government markets
• Government
markets are made
up of government
agencies that buy
goods and services
to produce public
services or transfer
the goods and
services to others
who need them.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-18
International markets
• International
market consists of
buyers in other
countries including
consumers,
producers,
resellers, and
governments.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-19
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-20
The Company’s Microenvironment
• Competitors:
– Those who serve a target market with
products and services that are viewed by
consumers as being reasonable
substitutes
– Company must gain strategic advantage
against these organizations
• Competitor analysis is an important
aspect of developing effective
marketing strategies
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-21
Who will win?
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Marketing : An Introduction
An Asian Perspective
3-22
The Competitive “Radar Screen”
Figure 3.7
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Marketing : An Introduction
An Asian Perspective
3-23
Types of Publics
Publics:
Group that has an interest in or impact on
an organization's ability to achieve its
objectives
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Marketing : An Introduction
An Asian Perspective
3-24
Financial Public
These influence the company’s ability to obtain funds. Banks,
investment houses and stockholders are the major financial
publics.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-25
Media Public
These carry news, features etc. They include newspapers, magazines, and
radio and television stations.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-26
Government public
Management must take government
developments into account.
Management must always follows the
government rules and regulations when doing
businesses mainly on issues of product safety,
truth in advertising and other matters.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
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Citizen action
Public
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Marketing : An Introduction
An Asian Perspective
3-28
Local/General public
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Marketing : An Introduction
An Asian Perspective
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Internal Public
These include workers, managers, volunteers,
and the board of directors.
Large companies use newsletters and other
means to inform and motivate their internal
publics.
When employees feel good about their
company, this positive attitude spills over to
the external publics.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-30
The Macro environment
• The company and all of the other
actors operate in a larger
macroenvironment of forces that
shape opportunities and pose
threats to the company.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-31
The Company’s Macroenvironment
Figure 3.8
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-32
The Company’s Macroenvironment
• Demographic:
– The study of human populations in terms of
size, density, location, age, gender, race,
occupation, and other statistics.
– Marketers track changing age and family
structures, geographic population shifts,
educational characteristics, and population
diversity.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-33
Changing Demographic Trends in Asia
create new Marketing Opportunities
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-34
Economic Environment
Consists of factors that affect consumer
purchasing power and spending patterns.
• Changes in Income
– 1980’s –
consumption frenzy
– 1990’s – “squeezed
consumer”
– 2000’s – value
marketing
© Armstrong, Kotler & da Silva
• Income Distribution
Marketing : An Introduction
An Asian Perspective
–
–
–
–
Upper class
Middle class
Working class
Underclass
3-35
Rising Consumer Affluence in Asia
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-36
Natural Environment
• Involves the natural
resources that are
needed as inputs by
marketers or that are
affected by marketing
activities.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-37
Factors Impacting the Natural
Environment
Shortages of Raw Materials
Increased Pollution
Increased Government Intervention
Environmentally Sustainable Strategies
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-38
Environmental Responsibility
McDonald’s has made a substantial commitment
to the so-called “green movement.”
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-39
Technological Environment
• Most
dramatic
force now
shaping our
destiny.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-40
Technological Environment
• Changes rapidly.
• Creates new
markets and
opportunities.
• Challenge is to
make practical,
affordable
products.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-41
Technology Gaps Between Asian Markets for
Consumer Electronic Products
Figure 3.9
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-42
Political Environment
Includes Laws,
Government
Agencies, and
Pressure Groups
that Influence or
Limit Various
Organizations and
Individuals In a
Given Society.
© Armstrong, Kotler & da Silva
Increasing Legislation
Changing Government
Agency Enforcement
Increased Emphasis on Ethics
& Socially Responsible Actions
Marketing : An Introduction
An Asian Perspective
3-43
Cultural Environment
• The institutions and other forces that affect
a society’s basic values, perceptions,
preference, and behaviors.
• Core beliefs and values are passed on
from parents to children and are reinforced
by schools, churches, business, and
government.
• Secondary beliefs and values are more
open to change.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-44
Thai culture
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-45
Schools
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Marketing : An Introduction
An Asian Perspective
3-46
Cultural Environment
Themselves
Society’s Major
Cultural Views Are
Expressed in
People’s Views of:
Others
Organizations
Society
Nature
The Universe
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-47
Linkage between Environmental Analysis and
Marketing
Figure 3.10
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-48
Linking of Macro and Micro Environmental Forces
Figure 3.12
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-49
Rest Stop: Reviewing the Concepts
• Describe the environmental forces that affect the
company’s ability to serve its customers.
• Explain how changes in the demographic and
economic environments affect marketing
decisions.
• Identify the major trends in the firm’s natural and
technological environments.
• Explain the key changes in the political and
cultural environments.
• Discuss how companies can react to the
marketing environment.
© Armstrong, Kotler & da Silva
Marketing : An Introduction
An Asian Perspective
3-50