MARKETING

1. MARKETING ENVIRONMENT

2. ENVIRONMENT • Actors & forces outside marketing that affects marketing management’s ability to build and maintain successful relationship with target customer • Marketing research & marketing intelligence • Microenvironment • Macroenvironment

3. MICROENVIRONMENT • Actors close to the company that affects its ability to serve its customers – company, supplier, marketing intermediaries, customer markets, competitors, publics • Creating customer value and satisfaction to build relationship with customers

4. COMPANY SUPPLIER MARKETING INTERMEDIARY CUSTOMER COMPETITORS PUBLICS

5. COMPANY • Other company groups/ departments • Top management • Finance, • Research & development • Purchasing • Operations • Accounting • Marketing managers make decision within strategies & plans made by top management • All must think “customer” & work in harmony

6. SUPPLIERS • An important link in customer value delivery system • Provide resources for its products & services • To watch supply availability – any problems can seriously affect marketers • Supply shortage • Labour problems • Price trends of key inputs • Walmart – suppliers – “a tough & demanding customer but helps you get there”

7. MARKETING INTERMEDIARIES • Help company promote sell and distribute its products to final buyers. • Resellers • Physical distributors • Marketing service firms • Financial intermediaries • Wholesalers/retailers • Examples –walmart, malls & other departmental stores • Coca- cola as exclusive beverage provider to many companies

8. CUSTOMERS • Five types of customers markets • Consumer markets • Business markets • Relseller market • Government market • International market

9. COMPETITORS • Provide greater customer value and satisfaction that its competitors • More than simply adapt the needs of target customers • Strong positioning – in the minds of people • No single strategy best for all companies

10. PUBLICS • Any group that has actual or potential interest in or impact on organisation’s ability to achieve the objectives • Financial publics- banks, investment firms, stockholders • Media publics- • Government publics- • Citizen action publics • Local publics • General publics • Internal publics

11. MACROENVIRONMENT • Consists of larger societal forces that affect the macroenvironment – • demographic, • economical, • natural, • technological, • political and • cultural forces

12. Macro-Environment Forces (DENTPC) • The macro - environment of any business consists basically of six factors: • Demographic Environment population- people make up the markets. • keenly interested in the size and growth rate of population in • different cities, • regions and • nations, • age distribution and • ethnic mix.

13. WORLD POPULATION • INTERNATIONAL SCENARIO- population explosion; India will overtake China by 2025 as most populous • If world be a village of 1000 people- • 520 men & 480 women • 330 children, 60 above 65yrs, • 10 college graduates, 335 illiterate adults • 52 North Americans, 55 Russians, 84 Latin Americans, 95 Europeans, 124 Africans, 584 Asians • 165 speak Mandarin, 86 English, 83 Hindi/ Urdu, 64 Spanish, 58 Russians, 37 Arabic, rest one of over 200 languages • 329 Christians, 178 Muslims, 132 Hindus, 62 Buddhists, 3 Jews, 167 non religious, 45 atheists and 86 others

14. LITERACY LEVELS • Definition- above 15 yrs and able to read & write • In India- 70% males & 48% females are literate • 52% population male; 13% illiterate, 23.8% literate but non matriculate, 11.5% literate but non graduate. 3.4% graduate and above • Literacy levels vary according to age • 15-24= 76%; declines with age

15. US • BABY BOOMERS- 78 millions (300 millions) – 27.5%; 1946-64; 2.1 trillion $; 75% national assets; 40% national disposable income by 2029 (65yrs age); all walks of life; 25% ethnic minority • GEN X- in shadow of BBs; no characteristics; Baby busters; latchkey kids; divorcee & employed mothers; more cautious economic outook; more skeptical; MTV generation; • GEN Y-echo boomers; 1977-94; children of BBs; 76 m: 160 b $ spending; techno geeks:

16. CHINA • One child norm- little emperor/ little empress; six pocket syndrome; rapidly aging population; 75% childless homes

17. GENERATIONAL MARKETING- Separate products and marketing programme for each generation ? • CHANGING FAMILY – nuclear family; one income one car two children family ; two incomes two car one child family • More people divorcing • Live in partners • Late marriage • No issue • Non traditional households – special care

18. KOOL GENERATION • Status symbol – mobile phones • Levi’s – streetwear – Sykes • Titan- “eye gear” – Fastrack • Sony Ericsson – 3D gaming mobile • Scooters – mobikes • MTV/ channel V • Hinglish • Youth culture – Valentine Day/ Friendship Day

19. GEOGRAPHICAL SHIFTS • Great migratory movements-population shift • Metro cities • Rural to urban (micropolitan areas beyond metropolitan cities) • Telecommute • Telebusiness • SOHO (small office / home office)

20. A better educated, more white collar, more professional population • Increasing diversity • Gay & Lesbian community • Disabled community

21. Economic Environment • GDP/ Per Capita GDP/ PPP/ Per Capita income/ Growth of economy/ FE reserves/Inflation/ Stock Market/ demographic indicators • available purchasing power in an economy, which depends on the • current prices, • savings, • debt and • credit availability. • pay close attention to the major trends in income and consumer spending patterns. • Changes in Income/ Income distribution • Changing consumer spending patterns • Economic forecasting

22. NCAER STUDY (2002)(1996 & 2006) (figures in millions) • 5 GROUPS OF HOUSEHOLDS • Destitutes (<16000 pa) (33/ 190.4 (16.5 / 95) • Aspirants (<22000 pa) (44/ 254 (20.2/117) • Climbers (<45000 pa) (54.1/312.2 (81.7/472) • Consuming class (<2,15000 pa) (32.5/186(75.5/432) • Rich (own money and wide range of products) (1.2/ 7(5.2/ 30) • CHANGING CONSUMPTION PATTERN- scooters/ M800 car

23. CHANGING PATTERNS1999 v/s 2003 (%) PHILOSOPHY OF EARN NOW AND SPEND LATER EARN NOW AND SPEND NOW

24. STUDY • RESEARCH INTERNATIONAL 2002- significant regional differences in values/ attitudes/ preferences of women – 4 clusters • Traditionalism and self sacrifice to westernisation and individualism • Based on shopping habits- categories of women • “Liberated youngsters” (13%) • “Modern mums” (18%) • “Behind the times” (20%) • “Rebellious youngsters (22%) • “Orthodox mothers (27%)

25. Natural Environment • be aware of the threats and opportunities associated with the four trends • the shortage of raw material, • the increased cost of energy, • the increased levels of pollution(environmentally sustainable business), and • the changing role of the governments.

26. GREEN MARKETING • OBSTACLES • Over exposure & lack of credibility • Consumer behaviour • Poor implementation

27. Technological Environment • One of the most dramatic forces shaping people’s lives. a force for "creative destruction.“ • Wonders or blunders • New technologies that provide superior value in satisfying needs stimulate investment and economic activity. • In the meantime minor innovations fill the gap, involve less risk ; too much research effort is going into producing minor improvements rather than major breakthroughs.

28. New technology creates major long-run consequences that are not always foreseeable. • RFID –smart chips • Practical, affordable and safe • Accelerating pace of change • unlimited opportunities for innovation • Greater emphasis on R&D • Increased regulations of technological change

29. EXAMPLES • RAYMOND LTD. – • fabrics made from exotic fibres. • Tancel, natural fibre from woodpulp; blended with wool- greater softness and drape; • Casein, a fibre made from milk protein - a butterfly feel; • Bamboo & Soyabeanfibres for softness & resilience • SAMSUNG- Digital Home Business • VIRTUAL REALITY (VR) – 3 D computer generated environment (sight, hear & touch) – automobile, kitchen , exterior home design

30. Political / Legal Environment • Marketing decisions are strongly affected by the developments in the political and legal environment. • that influence and limit various organisations and individuals. • laws, • government agencies and • pressure groups

31. BUSINESS LEGISLATION • PURPOSE - To charge businesses with social costs created by their products or production processes • To protect businesses from unfair competition • To protect consumers from unfair business practices • To protect society form unbridled business behaviour

32. Social Environment • The society in which people grow shapes their beliefs, values and norms. • People absorb, almost unconsciously, a wide view that defines their relationship with themselves, others, nature and the universe. • Socially responsible • Cause related marketing- one rupee on each notebook sold to CRY; paperless accounts statements; • Do well by doing good

33. Cultural environment • Persistence of cultural values • Shift in secondary cultural values • People’s views • People’s view of themselves- “Do It Yourself” “Adventurers” • People’s view of others- “cocooning” “Digital Age” • People’s view of organisation- “work for money” “scams”, “economic downturn” • People’s view of society- “patriotism” • People’s view of Nature – “LOHAS” market- everything natural (green) • People’s view of Universe-”religion”, “spiritualism”

34. REACTING TO ENVIRONMENT • 3 TYPES OF COMPANIES • Those who make things happen • Those who watch things happen • Those who wonder what has happened • View the environment as uncontrollable to which to react and adapt-avoid threat and take advantage of opportunities • Proactive stance – firm aggressive action • Cannot always control environment forces – shifting population/ economic environment/ major cultural shift; but taking proactive steps is in our hands