MKT 3401 Chapter : MKT 3401 Ch 4 Outline
Chapter 4: The Marketing Environment
Pg. 39
The External Marketing Environment
- Perhaps the most important decisions a marketing manager must make relate to the creation of the marketing
mix.
- Marketing Mix: the unique combination of product, place (distribution), promotion, and price strategies
- The marketing mix is, of course, under the firm’s control and is designed to appeal to a specific group of
potential buyers
- Target Market: a defined group that managers feel is most likely to buy a firm’s product
- Managers must alter the marketing mix because of changes in the environment in which consumers live, work,
and make purchasing decisions.
- Also, as markets mature, some new consumers become part of the target marker; others drop out
- Although managers can control the marketing mix, they cannot control elements in the external environment
that continually mold and reshape the target market
o Controllable and uncontrollable variables affect the target market
o Managers can shape and reshape the marketing mix to influence the target market
o That is, managers react to changes in the external environment and attempt to create a more effective
marketing mix
• Understanding the External Environment
o Unless marketing managers understand the external environment, the firm cannot intelligently plan for
the future
o Thus, many organizations assemble a team of specialists to continually collect and evaluate
environmental information, a process called Environmental Scanning
o The goal in gathering the environmental data is to identify future market opportunities and threats
• Environmental Management
o No single business is large or powerful enough to create major change in the external environment
o Thus, marketing managers are basically adapters rather than agents of change
o Just because a firm cannot fully control the external environment, it doesn’t mean that it is helpless
▪ Sometimes a firm can influence external events
▪ Environmental Management: when a company implements strategies that attempt to shape the
external environment within which it operates
- The factors within the external environment that are important to marketing managers can be classified as:
o Social
o Demographic
o Economic
o Technological
o Political and Legal
o Competitive
Social Factors
- Social change is perhaps the most difficult external variable for marketing managers to forecast, influence, or
integrate into marketing plans
- Include our attitudes, values, and lifestyles
• American Values
o A value is a strongly held and enduring belief
o During the United States’ first 200 years, four basic values strongly influence attitudes and lifestyles:
1. Self-Sufficiency: every person should stand on his or her own two feet
2. Upward Mobility: success would come to anyone who got an education, worked hard, and played by
the rules
3. Work Ethic: hard work, dedication to family, and frugality were moral and right
4. Conformity: no one should expect to be treated differently from everybody else
o These core values still hold for a majority of Americans today
o A person’s values are key determinants of what is important and not important, what actions to take or
not to take, and how one behaves in social situations
o People typically form values through interaction with family, friends, and other influencers
▪ The changing environment can also play a key role in shaping one’s values
o New trends becoming American values:
1. Getting off the grid: consumers are pursuing ways to become more self-sufficient, including
household generated energy, water conservation and purification, and private gardens
2. Meaningful green: green initiatives must be distinctive, memorable, and measurable to impact
environmental, social, and economic dimensions
3. EcoTechMed: new economic realities are motivating many to take greater steps toward proactive
health care rather than sick care and greater responsibility for their own health and wellness
o Values influence our buying habits
o U.S. consumers rank the characteristics or product quality as:
1. Reliability
2. Durability
3. Easy maintenance
4. Ease of use
5. Trusted brand name
6. Low price
• The Growth of Component Lifestyles
o Component Lifestyles: the practice of choosing goods and services that meet one’s diverse needs and
interests rather than conforming to a single, traditional lifestyle
o A lifestyle is a mode of living; it is the way people decide to live their lives
o Component lifestyles increase the complexity of consumers’ buying habits
o The unique lifestyles of every consumer can require a different marketing mix
• The Changing Role of Families and Working Women
o Component lifestyles have evolved because consumers can choose from a growing number of goods and
services, and most have the money to exercise more options
o The phenomenon of working women has probably had a greater effect on marketing than any other
social change
• There Is Never Enough Time
o Research show that’s the percentage of people who say they never have enough time to do all that they
need to do keeps increasing
Demographic Factors
- Demography: the study of people’s vital statistics such as age, race and ethnicity, and location
o Another uncontrollable variable in the external environment
o Significant because the basis for any market is people
o Demographic characteristics are strongly related to consumer buyer behavior in the marketplace
• Population
o People are directly or indirectly the basis of all markets, making population the most basic statistic in
marketing
o Those who are able to move despite the difficult housing market and economic slowdown tend to
downsize and relocate from the suburbs back to cities where there are more job openings
o Population is a broad statistic that is particularly useful when broken into smaller increments
o Age groups present opportunities for marketers; each group has its own needs, values, and
consumption patterns
▪ Tweens-
• Age 8 to 12
▪ Teens
• Two keys to effectively market to teens:
1. Make the product modern and convenient
2. Engage teens through promotion that gets them involved
Document Summary
Perhaps the most important decisions a marketing manager must make relate to the creation of the marketing mix. Marketing mix: the unique combination of product, place (distribution), promotion, and price strategies. The marketing mix is, of course, under the firm"s control and is designed to appeal to a specific group of potential buyers. Target market: a defined group that managers feel is most likely to buy a firm"s product. Managers must alter the marketing mix because of changes in the environment in which consumers live, work, and make purchasing decisions. Also, as markets mature, some new consumers become part of the target marker; others drop out. The factors within the external environment that are important to marketing managers can be classified as: social, demographic, economic, technological, political and legal, competitive. Social change is perhaps the most difficult external variable for marketing managers to forecast, influence, or integrate into marketing plans. Initially, generation y was a smaller cohort than baby boomers.
