Chapter 4- The Marketing environment – Flashcards
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A defined group most likely to buy a product Changes as consumers age External elements change consumers' desires
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Target Market
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when a company implements strategies that attempt to shape the external environment within which it operates.
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Environmental Management
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Attitudes, Values, Lifestyle
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Social Factors that affect marketing
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The practice of choosing goods and services that meet one's diverse needs and interests rather than conforming to a single, traditional lifestyle.
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Component Lifestyles
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Social Media allow the creation and exchange of user-generated content and include several formats that allow for: One-to-one communication One-to-many communication Many-to-many communication
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Role of Social media in communication
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People are the basis for any market Demographic characteristics relate to buyer behavior Demographic cohorts have their own needs, values, and consumption patterns.
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Demographic Factors
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Pre- and early adolescents, age 8 to 12 Population of 20 million Directly spend about $50 billion annually Parents spend $150 billion on tweens annually View TV ads as "just advertising"
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Tweens
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Population of about 25 million 93 percent of U.S. Teens are on the Internet View shopping as a social sport 50 million teens around the world are on Facebook The average teen spends about $45 per week
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Teens
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Born between 1979 and 1994 Surpassed population of baby boomers Two Stages: 1) Those born in 1994 fit closer to the Teen cohort. 2) Those born in 1979 have established careers and started families. Purchasing power of $200 billion annually
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Generation Y
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Born between 1965 and 1978 Population of 40 million Independent, resilient, adaptable, cautious, and skeptical 71 percent have children under age 18 Home ownership is an important goal Avid buyers of the latest clothes, technology, and recreational products
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Generation X
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Born between 1946 and 1964 Population of 75 million Working longer to compensate for economic downturn, which affected retirement savings The market of services directed at seniors is one of the fastest growing business markets
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Baby Boomers
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Estimated purchasing power of ethnic markets in 2013: Hispanics: $1.5 trillion African Americans: $1.2 billion Asian Americans: $775 billion The minority population of the United States in 2011 reached 110 million.
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Growing ethnic Markets
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The Hispanic population's diversity creates challenges for targeting this market. 60 percent of Hispanics are of Mexican descent. Highly responsive to new media: mobile marketing and social media marketing
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Marketing to Hispanic Americans
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47 percent are between 18 and 49 years old More firms are creating products for the African American market. Promotional dollars and media choices directed toward African Americans continue to increase.
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Marketing to African Americans
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Younger, better educated, and have highest average income of all groups Early adopters of latest digital gadgets. Cultural diversity within the Asian American market complicates promotional efforts.
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Marketing to Asian Americans
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Consumer's Income, Purchasing Power, Inflation, Recession
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Economic Factors
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Median U.S. household income in 2012 was approximately $50,000. Incomes have risen at a slow pace in recent years. Education is the primary determinant of earning potential
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Consumer's Income
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a comparison of income versus the relative cost of a set standard of goods and services in different geographic areas.
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Purchasing Power
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a measure of the decrease in the value of money, expressed as the percentage reduction in value since the previous year.
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Inflation
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a period of economic activity characterized by negative growth, which reduces demand for goods and services.
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Recession
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Basic, Applied
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Research
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Pure research that aims to confirm an existing theory or to learn more about a concept phenomenon.
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Basic Research
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An attempt to develop new or improved products
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Applied Research
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New technology, Society, Businesses,Consumers
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Political and legal factors; laws and regulations protect
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Sherman Act Clayton Act Federal Trade Commission Act Celler-Kefauver Antimerger Act Hart-Scott-Rodino Act Foreign Corrupt Practices Act
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federal legislation: Regulate competitive environment
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Robinson-Patman Act
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federal legislation: Regulate pricing practices
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Wheeler-Lea Act
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federal legislation: Control false advertising
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Consumer Product Safety Commission, Federal Trade Commission, Food & Drug Administration
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Regulatory agencies
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Protects consumer safety in and around their homes
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Consumer Product Safety Commission
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Prevents unfair methods of competition in commerce
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Federal Trade Commission
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Enforces safety regulations for food and drug products
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Food & Drug Administration
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Bureau of Competition and Bureau of Consumer Protection
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Bureaus of the FTC
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Reviews mergers and acquisitions Challenges anti-competitive conduct Promotes competition Provides information
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Bureau of Competition
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Enforces federal laws that protect consumers Empowers consumers with information Communicates with consumers about fraud and identity theft
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Bureau of Consumer Protection
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Market Share and Profits, Global Competition
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Competitive factors of foreign and Domestic competition
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Firms must work harder to maintain profits and market share.
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Market Share and Profits
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More foreign firms are entering U.S. market. Foreign firms in U.S. now compete on product quality.
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Global Competition
