MRKT- Chapter 3

Determine an effective marketing response to a change in the social-cultural environment.

The social-cultural environment is the relationship between marketing, society, and culture. To remain competitive, marketers must be sensitive to society's demographic shifts and changing values, which affect consumers' reactions to different products and marketing practices.

Describe how a change in the technological environment can impact a firm's marketing activities.

The technological environment consists of the application of knowledge based on discoveries in science, inventions, and innovations. By monitoring and responding to the technological environment, marketers can gain a competitive edge with innovative products, cut costs, improve customer service, and benefit society.

Contrast the two types of competition that marketers face.

The two types of competition are: (1) direct competition among marketers of similar products and (2) indirect competition among goods or services that can be substituted for one another.

You own an expensive restaurant and have a thriving business until the economic recession hits. Sales immediately plummet as your diners disappear. Some friends argue that a big advertising campaign focused on the quality of your food would bring the customers back, but you don't agree. Choose the statement(s) you'd use to accurately explain your point of view.

a. During a recession, consumers are more likely to respond to discount deals than to ads touting the quality of a purchase that isn't a necessity. c. During a recession, consumers limit expenditures on items that aren't necessary, like restaurant meals.

You are the head of the corporate acquisitions team at a major biotech company in Atlanta, Georgia. Your team has identified a couple of attractive acquisition targets that you would like to recommend to the Board of Directors for consideration. However, before you make a recommendation, you want to make sure that none of the acquisitions will raise any regulatory issues. In order to evaluate all potential regulatory issues, which one of the following analytical actions should you have your team complete prior to making any recommendations?

b. A thorough analysis of the provisions of the Celler-Kefauver Act, the Clayton Act, and the Sherman Antitrust Act

You work for an automobile manufacturing company whose sales have been low as a result of the economic downturn. Company executives are strategizing as to how to stimulate sales. Which of the following steps should they take to improve business?

b. Decrease prices and offer more promotions.

Marketing ethics and social responsibility are important to the success of marketing strategies. Marketing ethics defines the principles and standards that define acceptable conduct in marketing. Which of the following decisions is not related to marketing ethics?

b. The Director of Marketing wants to withdraw a product because it is no longer profitable or competitive.

You just got hired by the Federal Trade Commission, and you're the envy of all your friends. You feel good when you overhear your roommate describe your new job to another student. However, in his enthusiasm, he made a couple of mistakes. Which of the following points about the FTC did your roommate get wrong?

b. The FTC sets safety standards for consumer products. c. Because of its enormous power, the FTC is known informally as the Federal Power Commission. e. The FTC operates at the state level as well as the federal level.

The pyramid of corporate social responsibility states that there are four dimensions of social responsibility: economic, legal, ethical, and philanthropic. The socially responsible marketer accepts different responsibilities for each of these dimensions in terms of how she carries out her marketing activities. You have been asked to make a presentation to management that will highlight your company's ethical responsibilities. Which of the following topics do you plan to discuss?

c. It is important to recognize that corporate integrity and behavior go beyond mere compliance with laws and regulations.

Describe the regulatory forces that influence the marketing environment.

Marketing activities are influenced by federal, state, and local laws that require firms to operate under competitive conditions and to protect consumer rights. Public and private consumer interest groups and industry self-regulatory groups also affect marketing activities.

Given a variable of the marketing mix, describe an ethical issue related to that variable.

Marketing ethics encompass the marketer's standards of conduct and values. Each element of the marketing mix raises its own set of ethical questions.

Identify the five components of the marketing environment.

The five components of the marketing environment are the competitive environment, political-legal environment, the economic environment, technological environment, and social-cultural environment.

Define the four dimensions of social responsibility.

The four dimensions of social responsibility are economic, legal, ethical, and philanthropic.

Summarize the four major types of government regulation that affect marketing practices.

The four major types of government regulation are maintaining a competitive environment, regulating competition, protecting consumers, and deregulating specific industries to increase competition.

Outline the economic factors that affect marketing decisions and consumer buying power.

The primary economic factors are the stage in the business cycle, inflation and deflation, unemployment, and income. All are vitally important to marketers because of their effects on consumers' willingness to buy and consumers' perceptions regarding changes in the marketing mix variables.

Marketers must continually assess changes in the competition and make changes in their own competitive strategy because the competitive environment often determines success or failure of a product. Which of the steps below can a marketer for a large retail discount store (e.g., Target, Walmart, Sears) implement as part of the store's competitive strategy as children are headed back to school? Choose the step that you think will be most profitable.

a. Run Early Bird Special discounts on end-of-summer weekends for local school supply lists, toiletries, and clothing.

The legal and regulatory forces in the marketing environment consist primarily of laws that are enforced by a variety of agencies operating at the federal, state, and local levels of government. Which of the following laws and agencies is (are) incorrectly linked to an area of regulatory responsibility?

a. The CPSA sets standards for business-to-business products. b. The FDA prohibits adulteration of food, drugs, and additives.

Marketers must pay attention to changes in sociocultural forces in order to send effective marketing messages to their target market. Sociocultural forces occur incrementally, making it easy to miss the shift until it is fully integrated. These can include a change in population characteristics such as age, gender, ethnicity, income, education, and marital and parental status. The degree to which these changes take place determines the amount of diversity present in a particular market, which, in turn results in different consumer buying behaviors. Cultural values affect the way people think about and make purchases, and largely result from one's family. Consumerism is a movement to protect consumers' rights, whose values can be heard from individuals, organizations, or groups. Which of the following statements provides a correct example of consumerism?

d. A snack and beverage company is reacting to consumer complaints about high sugar content in their products.

Marketers must continually acquire information about trends, events, and societal dynamics occurring in the marketing environment outside of the firm in order to identify and interpret potential positive and negative forces that may impact the firm's marketing strategies. The following statements provide examples of trends related to environmental forces. Which of these examples is correct?

e. Advances in biotechnology, cosmetic surgery, and cancer drugs are related to technological forces.

Your company just attended a symposium on sustainability; and as company president, you are interested in raising the level of social responsibility in all that the company does, whether manufacturing goods, marketing, or offering services that improve the lives of individuals in the communities you serve. Which of the following steps can your company take to ensure that its practices are socially responsible?

e. Eliminate the use of paper-based circulars and rely solely on Web-based and social marketing strategies to promote products.

Venmo is a mobile application that enables people to send and receive money for free as long as they have a bank account, supported debit card, or a Venmo balance to fund payments. Venmo also allows the use of credit cards for a fee. To ensure security, the company uses bank-grade security systems and data encryption to prevent unauthorized transactions or access to personal information. Venmo operates as a mobile wallet, and though it provides services comparable to Western Union and PayPal, it can be managed through smartphones, thus appealing to a wide audience of retailers and others who depend on efficient money exchange. In an analysis of Venmo for your marketing class, you argue that it exemplifies how technological change creates marketing opportunities. What is the core of your argument?

e. Technological change often enables companies to greatly improve customer service.