MKTG Chapter 4 the marketing environment

Discuss the political and legal environment of marketing.

All marketing activities are subject to state and federal laws and the rulings of regulatory agencies. Marketers are responsible for remaining aware of and abiding by such regulations. Some key federal laws that affect marketing are the Sherman Act, Clayton Act, Federal Trade Commission Act, Robinson-Patman Act, Wheeler- Lea Amendments to the Federal Trade Commission Act, Lanham Act, Celler-Kefauver Antimerger Act, and Hart-Scott-Rodino Act. Many laws, including privacy laws, have been passed to protect the consumer as well. The Consumer Product Safety Commission, the Federal Trade Commission, and the Food and Drug Administration are the three federal agencies most involved in regulating marketing activities. Declining population growth, rising costs, and shortages of resources have heightened domestic competition.

Explain the importance to marketing managers of growing ethnic markets.

Growing minority populations make the marketer's task more challenging. Hispanics are the fastest growing segment of the population, followed by African Americans. Many companies are now creating departments and product lines to effectively target multicultural market segments. Companies have quickly found that ethnic markets are not homogeneous.

Identify consumer and marketer reactions to the state of the economy.

In recent years, U.S. incomes have risen at a slow pace. At the same time, the financial power of women has increased, and they are making the purchasing decisions for many products in traditionally male-dominated areas. During a time of inflation, marketers generally attempt to maintain level pricing to avoid losing customer brand loyalty. During times of recession, many marketers maintain or reduce prices to counter the effects of decreased demand; they also concentrate on increasing production efficiency and improving customer service.

Identify the impact of technology on a firm.

Monitoring new technology and encouraging research and development (R&D) of new technology is essential to keeping up with competitors in today's marketing environment. Innovation through R&D needs to be stimulated by upper management and fostered in creative environments. Innovation is increasingly becoming a global process, with more patents being awarded to non-U.S. citizens. Without innovation, U.S. companies can't compete in global markets. Companies that are innovators have stronger performance in their respective markets.

Explain the basics of foreign and domestic competition.

The competitive environment encompasses the number of competitors a firm must face, the relative size of the competitors, and the degree of interdepen dence within the industry. Declining population growth, rising costs, and shortages of resources have heightened domestic competition.

Discuss the external environment of marketing and explain howit affects a firm.

The external marketing environment consists of social, demographic, economic, technological, political and legal, and competitive variables. Marketers generally cannot control the elements of the external environment. Instead, they must understand how the external environment is changing and the impact of that change on the target market. Then marketing managers can create a marketing mix to effectively meet the needs of target customers

Explain the importance to marketing managers of current demographic trends.

Today, several basic demographic patterns are influencing marketing mixes. Because the U.S. population is growing at a slower rate, marketers can no longer rely on profits from generally expanding markets. Marketers are also faced with increasingly experienced consumers among the younger generations such as tweens and teens. And because the population is also growing older, marketers are offering more products that appeal to middle-aged and older consumers.

Describe the social factors that affect marketing.

Within the external environment, social factors are perhaps the most difficult for marketers to anticipate. Several major social trends are currently shaping marketing strategies. First, people of all ages have a broader range of interests, defying traditional consumer profiles. Second, changing gender roles are bringing more women into the workforce and increasing the number of men who shop. Third, a greater number of dual-career families has created demand for time-saving goods and services.