Principles of marketing: Lecture 10

MGT301
Principles of Marketing
Lecture­10


Summary
of  
Lecture­9


The Marketing Environment


Demographic
Company

Cultural
Publics

Economic
Suppliers

Company

Political Competitors

Customer
s
Intermediaries

Technological

Natural


The Microenvironment


Company
Company
 Suppliers
 Suppliers

Publics
Publics
Forces Affecting a 
Forces Affecting a 
Company’s Ability to 
Company’s Ability to 
Serve
Serve
Customers
Customers
Competitors
Competitors

Intermediaries
Intermediaries
Customers
Customers

Today’s Topics

The Macroenvironment


Demographic
Demographic

Cultural
Cultural

Forces that Shape
Forces that Shape
Opportunities 
Opportunities 
and Pose Threats
and Pose Threats
to a Company
to a Company

Political
Political

Economic
Economic

Natural
Natural
Technological

Technological


Demographic 

 Demographic ­ monitors population in terms of age, 

sex, race, occupation, location and other statistics.


Key Generations




Baby Boomers
Generation X
Generation Y

The 78 million people born 
during the baby boom, 
following World War II and 
lasting until the early 1960’s


Key Generations
 Baby Boomers
 Generation X
 Generation Y



The 45 million people



Born between 1965 and 
1976



Share new cultural 
concerns


Key Generations


Baby Boomers



Generation X



Generation Y



Born between 1977 and 
1994



72 million strong; almost as 
large a group as their baby 
boomer parents



New products, services, and 
media cater to GenY



Challenging target for 
marketers


Key Demographic Trends
– Changing household
– Geographic population shifts
– Better­educated, more white­collar workforce
– Increasing Diversity


Economic Environment
Economic Environment ­ factors that affect consumer 
buying power and spending patterns.

Economic
Economic
Development
Development
Key
Key
Economic
Economic
Concerns
Concerns for
for
Marketers
Marketers
Changes
Changes
in
in Consumer
Consumer
Spending
Spending
Patterns

Changes
Changes
in
in Income
Income



Rapid Change



Interest Rates



Inflation



Global Economy


Natural Environment

Natural environment­ natural resources needed as inputs by 
marketers or that are affected by marketing activities .





Shortage of raw materials
Increased pollution
Government intervention

Technology Environment
Technological environment­ forces that create new technologies, 
creating new product and market opportunities.


Computers and computing power



Communications capabilities
– cellular communications
– the internet



Virtual reality


Rapid
Rapid Pace
Pace of
of
Change
Change

High
High R
R&

&D
D
Budgets
Budgets

Issues
Issues in
in the
the Technological
Technological
Environment
Environment

Focus
Focus on
on Minor
Minor
Improvements
Improvements

Increased
Increased
Regulation
Regulation


Main Problem:
It can make your product obsolete.

Political Environment

Political environment­ laws, government agencies and pressure 
groups that influence or limit marketing actions.


Increased
Increased
Legislation
Legislation

Changing
Changing
Enforcement
Enforcement

Key
Key
Trends
Trends in
in the
the
Political
Political
Environment
Environment
Greater
Greater
Concern
Concern for

for
Ethics
Ethics


Cultural Environment
Cultural environment­ forces that affect a society’s basic values, 
perceptions, preferences, and behaviors.


Of
Oneself
Of
the Universe

Of
Nature

Views
Views
That
That Express
Express
Values
Values

Of
Others

Of

Organizations

Of
Society


Responding to the Marketing 
Environment
 Reactive: Passive Acceptance and Adaptation 

– Companies design strategies that avoid threats and 
capitalize upon opportunities.

 

 Proactive: Environmental Management
– Use of lobbyists, PR, advertorials, lawsuits, complaints, and 
contractual agreements to influence environmental forces.