MKTG101 Marketing Fundamentals
Week 2 Marketing and its Environment Market Research and Information
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Marketing environments
Political
Macro-environment
Economic
Micro-environment Customers Competitors
Intra-firm
Suppliers Technological
Publics
Distribution Social
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TNC’s and Mktg
• Most important Macro-environments are: Political stability followed by Economic conditions. • Most important Micro-environments are: Customers and competition. • All of these environments are governed to some degree by both local culture and by local/regional governmental influences.
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Macro vs Micro environments
• Macroenvironment – The larger societal forces that affect the whole microenvironment. – Operate similarly on all participants in a market – Not susceptible to change by one competitor
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Macro vs Micro environments
• Microenvironment – The Porter 5 forces close to the organisation that affect its ability to serve its customers – Have a unique impact on each participant – Susceptible to change by one competitor
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Actors in microenvironment
Company Suppliers Competitors
Marketing Intermediaries
Customers
Publics
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Mini-Micro environments
Intra-firm environment: all of the other parts
within the organisation that are essential to the marketing process
– – – – –
Production Purchasing Distribution and Sales Accounts and Administration Corporate Management Competencies
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Micro factors 1: Suppliers
Power of Suppliers: the important first link in the organisation’s overall customer ‘value delivery system’.
– If the right supplies are not available in the right place at the right price, the organisation cannot deliver its side of the marketing exchange
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Micro factors 2.: Intermediaries
Power of Marketing intermediaries: these provide a bridge between the time and place when a product is produced and the time and place when it is consumed.
• • • • • Resellers Marketing Services Agencies Physical Distribution Firms Financial Intermediaries Govt - agencies
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Micro factors 3.: Customers
Power of Customers: The marketing organisation does not exist without its customers.
– The organisation can operate in five types of customer markets, depending on the characteristics or the behaviour of the customers involved:
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Micro factors 4.: Competitors
Power of Competitor: any other, alternative way of satisfying our customer’s needs
– We need to know the identity and the characteristics of our competitors. – To succeed, we must provide greater customer value than its competitors. – No single competitive marketing strategy is best for all situations. The best strategy offers the best solution to the organisation’s unique combination of strengths, weaknesses, opportunities and threats in a particular situation.
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Micro factors 5.: Publics
Power of Publics: any group that has an actual or potential interest in, or impact on, an organisation’s ability to achieve its objectives. Every organisation is involved with several types of publics:
– – – – – – – Financial Media Government Citizen action incl religious groups Local community General public Internal publics
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Types of markets
Consumer markets: customers who purchase a product for the satisfaction of their own personal needs Business markets: buy a product to sell on to another customer in some form Reseller markets: marketing intermediaries involved in the distribution channel Government markets: usually the largest markets in their particular areas and operate differently from consumer and business markets International markets: consumer, business or government markets located in a country other than the marketer’s home country
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Major Forces in the organisation’s macro environment
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Demographic environment
Growing Ethnic Diversity
Age Structures
Education
Key Demographic Trends
Changing Family Structure
Geographic Shifts
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Changing demographic environments
Changes in demographic environments are being reflected in changes in customer behaviour:
– – – – – Changing age structure of population Changing family structures Geographic shift in population Better educated and more white-collar population Increased ethnic diversity but with a shift towards global citizenship
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Economic environment
Economic Development
Key Economic Concerns for Marketers
Changes in Income
POLITICAL STABILITY of HOST for TNC’s
Changes in Consumer Spending Patterns
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Natural environment & societal mktg
Shortage of Raw Materials
Government Intervention
Key Areas of Concern in the Natural Environment
Energy Costs
Increased Pollution
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Technological environment
Fast Pace of Change High R & D Budgets
Issues in the Technological Environment
Focus on Minor Improvements
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Increased Regulation
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Political environment
Legislation
Enforcement
Key Trends in the Political Environment
MAI ??? And its impacts
Greater Concern for Ethics
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Cultural environment
Culture: is a set of learned responses to recurring situations
– It is learned, not genetically transmitted – The various facets of culture are interrelated – It is shared by members of a group and defines the boundaries between different groups
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Aspects of culture
Values: the goals a society views as important
Norms: rules of conduct between people Roles: customary ways of behaviour associated with a position Language, Attitudes, Beliefs, Artifacts
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Social groups
Reference group: a group that has an influence on an individual’s decision-making Membership group: a group to which an individual belongs.
– Voluntary – Involuntary
Aspirational group: a group to which an individual aspires to belong
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The Importance of Information
Marketing Environment Competition Why Information Is Needed Strategic Planning
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Customer Needs
Venn diagrams
• Mkt Research (MR) feeds data into the MkIS (Mktg Info Systems) which is part of • The MIS – Mangt Info Systems and this is a part of • The overall CIS – Corporate Intelligence System
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Marketing information
Objective: to assist a marketer to make informed and therefore better decisions
• Data: organised facts • Information: facts that are useful in making a marketing decision
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The Marketing Information System
Marketing Decisions and Communications
Marketing Managers
Distributing Information Information Analysis
Marketing Research Developing Information
Assessing Needs
Internal Records
Marketing Intelligence
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Information sources
Marketing research: a systematic process commissioned to gather answers to predetermined questions Marketing intelligence: all other information gathered from the market Internal records: all accounting and other data within the organisation that contains information useful in making a marketing decision
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The Marketing Research Process
1. Defining the Problem
2. Developing the Research Plan
3. Implementing the Research Plan
4. Interpreting and Reporting the Findings
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Problem recognition
Before the process can commence, the problem must be clearly identified
Management problem: a decision to be made by management (the decision maker) Research problem: the information that the research process can generate which will help the decision maker make an informed decision
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Research design decisions
Primary research: data gathered specifically for this particular research project
Secondary research: data useful for this project but gathered in response to another research project Descriptive studies: a list of the key features of the current situation Causal studies: an attempt to identify a cause-andeffect relationship
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Research methodology decisions
Survey: an interactive method of gaining
specific information from respondents
Observation: a non-interactive method of
gaining information from respondents
Experimentation: a study in which one or
more independent variables are manipulated and the effect on one or more dependent variables is measured
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Sample selection issues
Population: all the elements that are of interest to this particular project Census: gathering a response from every member of the population Sampling methods:
– Probability: each member of the population has a known and equal probability of selection – Non-probability: sampling techniques that rely on the judgment of the researcher
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Sources of error in marketing research
Systematic bias: a bias built into the project through poor design Sampling error: an error resulting from the variability of
samples Interviewer bias: an error introduced by an individual interviewer Respondent bias: a bias introduced by an individual
respondent
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Market research ethical issues
• Indigenous groups
• Ethical intention • Professional conduct • Deception • Manipulation • Invasion of privacy
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