Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1...
-
Upload
ernest-pope -
Category
Documents
-
view
220 -
download
2
Transcript of Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1...
![Page 1: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/1.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1
MKTG
Designed byAmy McGuire, B-books, Ltd.
Prepared byDeborah Baker, Texas Christian University
Lamb, Hair, McDaniel 2007-2008
Social
Responsibility, Ethics,
and the Marketing Environment
3CHAPTER
![Page 2: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/2.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 2
Learning Outcomes
Discuss corporate social responsibility
Describe the role of ethics and ethical decisions in business
Discuss the external environment of marketing, and explain how it affects a firm
LO1
LO2
LO3
![Page 3: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/3.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 3
Learning Outcomes
Describe the social factors that affect marketing
Explain the importance to marketing managers of current demographic trends
Explain the importance to marketing managers of multiculturalism and growing ethnic markets
LO4
LO5
LO6
![Page 4: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/4.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 4
Learning Outcomes
Identify consumer and market reactions to the state of the economy
Identify the impact of technology on a firm
Discuss the political and legal environment of marketing
Explain the basics of foreign and domestic competition
LO7
LO8
LO9
LO10
![Page 5: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/5.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 5
What do these firms have in common?
![Page 6: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/6.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 6
Discuss corporate social responsibility
Corporate Social ResponsibilityCorporate Social ResponsibilityLO1
![Page 7: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/7.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 7
LO1
Corporate Social Responsibility
The idea that socially The idea that socially
responsible companies will responsible companies will
outperform their peers by outperform their peers by
focusing on the world’s social focusing on the world’s social
problems and viewing them problems and viewing them
as opportunities to build as opportunities to build
profits and help the world at profits and help the world at
the same time.the same time.
SustainabilitySustainability
![Page 8: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/8.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 8
REVIEW LEARNING OUTCOMELO1
Corporate Social Responsibility
EthicalEthicalDo what is right.Do what is right.
LegalLegalObey the Law.Obey the Law.
EconomicEconomicBe profitable.Be profitable.
PhilanthropicPhilanthropicBe a good citizen.Be a good citizen.
![Page 9: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/9.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 9
Social Responsibility
Management philosophy in which organizations engage in activities that have a positive effect on society and promote the public good
Tools of social responsibility
environmental stewardship
cause marketing
cultural diversity
LO2
![Page 10: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/10.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 10
Environmental Stewardship
Firms make choices that protect the environment
Green marketing describes a type of environmental stewardship in which firms choose packages, product designs, and other aspects of the marketing mix that are earth friendly
![Page 11: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/11.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 11
Stonyfield Farm and Green Marketing
![Page 12: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/12.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 12
Cause Marketing
Strategy of joining forces with a not-for- profit organization to tackle a social problem
Straight donations to a charity
Donations linked to consumer sales response
![Page 13: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/13.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 13
Ford & Breast Cancer Research
![Page 14: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/14.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 14
Promoting Cultural Diversity
Cultural diversity programs ensure that marketing policies and hiring practices give people an equal chance to work for the company and buy its products
See Fortune’s Best Companies for Minorities
McDonald’s ranked #1 in 2004
![Page 15: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/15.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 15
Describe the role of ethics and ethical
decisions in business
Ethical Behavior in BusinessEthical Behavior in BusinessLO2
![Page 16: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/16.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 16
Ethical Behavior in Business
LO2
EthicsEthics
MoralsMorals
The moral principles or values
that generally govern the
conduct of an individual.
The rules people develop as a result of cultural values and norms.
![Page 17: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/17.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 17
Ethical Development Levels
LO2
PreconventionalMorality
ConventionalMorality
PostconventionalMorality
MoreMature
MoreChildlike
• Based on what will be punished or rewarded
• Self-centered, calculating, selfish
• Moves toward the expectations of society
• Concerned over legality and the opinion of others
• Concern about how they judge themselves
• Concern if it is right in the long run
![Page 18: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/18.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 18
Ethical Decision Making
LO2
Influential Factors
Extent of Problems
Top Management Actions
Potential Consequences
Social Consensus
Probability of Harm
Time UntilConsequences
Number Affected
![Page 19: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/19.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 19
Biz Flix
LO2 Jaws
![Page 20: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/20.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 20
Code of Ethics
LO2
A guideline to help marketing
managers and other employees
make better decisions.
Code of EthicsCode of Ethics
http://www.ethicsweb.ca
Online
![Page 21: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/21.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 21
Kellogg’s Code of Ethics
![Page 22: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/22.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 22
![Page 23: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/23.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 23
Creating Ethical Guidelines
LO2
Helps identify acceptable business practices
Helps control behavior internally
Avoids confusion in decision making
Facilitates discussion about right and wrong
![Page 24: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/24.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 24
Ethical Norms and Values for Marketers
LO2
![Page 25: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/25.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 25
Discuss the external environment
of marketing, and explain how it affects a firm
The External Marketing EnvironmentThe External Marketing EnvironmentLO3
![Page 26: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/26.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 26
External Marketing EnvironmentLO3
DemographicsDemographics
SocialChangeSocial
Change
EconomicConditionsEconomicConditions
Political & Legal FactorsPolitical &
Legal Factors
TechnologyTechnology
CompetitionCompetition
EnvironmentalScanning
Target Market
External Environment (uncontrollable)
Ever-ChangingMarketplace
ProductDistributionPromotion
Price
ProductDistributionPromotion
Price
Internal (within the
organization)
Marketing mix
![Page 27: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/27.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 27
Target MarketLO3
A defined group most likely to
buy a firm’s product.
Target MarketTarget Market
![Page 28: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/28.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 28
Describe the social factors that affect
marketing
Social FactorsSocial FactorsLO4
![Page 29: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/29.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 29
LO4
Social Factors
ValuesValues
AttitudesAttitudes
LifestyleLifestyle
![Page 30: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/30.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 30
LO4
Social Factors
Social Factors Influence:Social Factors Influence:
Products purchasedProducts purchased
Prices paid for productsPrices paid for products
Effectiveness of promotionsEffectiveness of promotions
How, where, and when people purchaseHow, where, and when people purchase
![Page 31: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/31.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 31
LO4
Social Factors
Self-SufficiencySelf-Sufficiency
Upward MobilityUpward Mobility
Work EthicWork Ethic
ConformityConformity
Core American Values
![Page 32: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/32.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 32
LO4
The Influence of Values on Buying Habits
Ranked Characteristics of Product Quality
Reliability
Durability
Easy maintenance
Ease of use
Trusted brand name
Low price
![Page 33: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/33.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 33
LO4
Component Lifestyles
ComponentLifestyles
ComponentLifestyles
The practice of choosing goods
and services that meet one’s
diverse needs and interests
rather than conforming to a
single, traditional lifestyle.
![Page 34: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/34.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 34
LO4
Role of Families and Working Women
Growth of dual-income families results in increased purchase power
Approximately 63% of work-age females are in the workforce
Women expect different things in life
– purchase bulk of technology products
– do most of the grocery shopping
– second largest group of home buyers after couples
Single households outnumber married households with kids
![Page 35: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/35.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 35
REVIEW LEARNING OUTCOMELO4
Social Factors that Affect Marketing
![Page 36: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/36.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 36
Explain the importance to marketing managers of current demographic
trends
Demographic FactorsDemographic FactorsLO5
![Page 37: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/37.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 37
Demographic FactorsLO5
DemographyDemography The study of people’s
vital statistics, such as
their age, race and
ethnicity, and location.
![Page 38: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/38.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 38
TweensLO5
Pre- and early adolescents, age 8 to 14
Population of 29 million
Purchasing power of $39 billion in 2007
View TV ads as “just advertising”
Emerging as “the richest generation” and the “most influential generation in history”
![Page 39: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/39.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 39
Generation YLO5
Born between 1979 and 1994Population of 60 millionPurchasing power of $200 billion annuallyResearchers have found Gen Yers to be:
ImpatientFamily-orientedInquisitiveOpinionatedDiverseTime managers“Street Smart”
Word of mouth marketing is effective
Online
http://www.mountaindew.comhttp://www.northface.com
![Page 40: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/40.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 40
Generation XLO5
Born between 1965 and 1978
Population of 40 million
Savvy and cynical consumers
Time is at a premium, and outsourcing is utilized
Entering their money-making years
![Page 41: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/41.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 41
Baby BoomersLO5
Born between 1946 and 1964
Population of 77 million—the largest demographic segment
$1 trillion in spending power for people aged 50 to 60
Income will continue to grow as they keep working
![Page 42: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/42.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 42
REVIEW LEARNING OUTCOMELO5
Current Demographic Trends
AgeTweens
8 to 14 yrs29 million
Gen Y
1979-199460 million
Gen X
1965-197840 million
Baby Boom
1946-196477 million
![Page 43: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/43.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 43
Explain the importance to marketing managers of multiculturalism and growing ethnic markets
Growing Ethnic MarketsGrowing Ethnic MarketsLO6
![Page 44: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/44.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 44
Growing Ethnic MarketsLO6
Spending power of ethnic markets by 2008:
Hispanics: $1 trillion
African Americans: $921 billion
Asian Americans: $526 billion
Diversity can result in bottom-line benefits to companies.
![Page 45: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/45.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 45
Marketing to Hispanic AmericansLO6
The population’s diversity creates challenges for targeting this group.
Hispanics tend to be brand loyal, but are not aware of many U.S. brands.
Nearly half of adult U.S. Hispanics have home Internet access.
![Page 46: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/46.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 46
Marketing to African AmericansLO6
Many firms are creating products for the African American market.
Promotional dollars and media choices directed toward African Americans continue to increase.
![Page 47: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/47.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 47
Marketing to AsianAmericans
LO6
Younger, better educated, and have highest average income of all groups
Many products have been developed for Asian American market.
Cultural diversity within the Asian American market complicates promotional efforts.
![Page 48: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/48.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 48
REVIEW LEARNING OUTCOMELO6
Multiculturalism and Growing Ethnic Markets
![Page 49: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/49.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 49
Identify consumer and marketer
reactions to thestate of the economy
Economic FactorsEconomic FactorsLO7
![Page 50: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/50.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 50
Economic Factors
LO7
Distribution of Consumer Income
Inflation
Recession
![Page 51: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/51.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 51
Consumers’ Incomes
LO7
Median U.S. household income in 2007 projected at $45,000
Incomes have risen at a slow pace.
Education is the primary determinant of earning potential.
Consumers are strapped for cash.
![Page 52: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/52.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 52
The Financial Power of Women
LO7
Women bring in half of the household income.
Women control 51.3 percent of the private wealth in the U.S.
Women control 80 percent of household spending.
Women are now the primary buyers in male-dominated categories: 68% of new cars 66% of computers 66% of home improvements 53% of investments 51% of consumer electronics
![Page 53: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/53.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 53
Purchasing Power
LO7
A comparison of the relative cost of
a set standard of goods and services
in different geographic areas.
PurchasingPower
PurchasingPower
![Page 54: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/54.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 54
Inflation
LO7
A measure of the decrease in the
value of the money, expressed as the
percentage reduction in value since
the previous year.
InflationInflation
![Page 55: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/55.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 55
Recession
LO7
A period of economic activity
characterized by negative growth,
which reduces demand for goods
and services.
RecessionRecession
![Page 56: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/56.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 56
Recession Marketing Strategies
LO7
Improve existing products and introduce new ones
Maintain and expand customer services
Emphasize top-of-the-line products and promote product value
![Page 57: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/57.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 57
Identify the impact of technology on a firm
Technological FactorsTechnological FactorsLO8
![Page 58: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/58.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 58
Research
LO8
Basic ResearchBasic Research
Applied ResearchApplied Research
Pure research that aims to confirm an existing theory or to learn more about a concept phenomenon.
An attempt to develop new or improved products
![Page 59: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/59.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 59
Technological Factors
LO8
U.S. excels at basic and applied research.
Many firms use the market concept to guide research.
New technology internally creates a long-term competitive advantage.
External technology Creates more efficient operation or better products May render existing products obsolete
![Page 60: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/60.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 60
Technological Factors
LO8
Innovation is becoming a global process.
New technologies create new opportunitiesRSS (Really Simple
Syndication)Blogging
![Page 61: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/61.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 61
REVIEW LEARNING OUTCOMELO8
Impact of Technology on a Firm
BasicResearch
BasicResearch
MarketingMix
MarketingMix
AppliedResearch
AppliedResearch
TechnologyAdvances
TechnologyAdvances
![Page 62: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/62.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 62
Discuss the political and legal
environment of marketing
Political and Legal FactorsPolitical and Legal FactorsLO9
![Page 63: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/63.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 63
LO9
Political and Legal Factors
New technology Society Businesses Consumers
Laws and Regulations Protect:Laws and Regulations Protect:
![Page 64: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/64.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 64
LO9
Federal Legislation
Sherman ActClayton ActFederal Trade Commission Act Celler-Kefauver Antimerger ActHart-Scott-Rodino Act
Sherman ActClayton ActFederal Trade Commission Act Celler-Kefauver Antimerger ActHart-Scott-Rodino Act
Regulate competitive
environment
Robinson-Patman ActRobinson-Patman ActRegulate
pricing practices
Wheeler-Lea ActWheeler-Lea ActControl falseadvertising
![Page 65: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/65.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 65
LO9
Regulatory Agencies
Consumer Product Safety Commission
Consumer Product Safety Commission
Federal Trade Commission
Federal Trade Commission
Food & Drug AdministrationFood & Drug
Administration
Protects consumer safety in and around their homes
Prevents unfair methods ofcompetition in commerce
Enforces safety regulations for food and drug products
Online
http://www.ftc.gov
![Page 66: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/66.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 66
LO9
Powers of the FTC
Cease-and-Desist OrderCease-and-Desist Order
Consent DecreeConsent Decree
Affirmative DisclosureAffirmative Disclosure
Corrective AdvertisingCorrective Advertising
RestitutionRestitution
CounteradvertisingCounteradvertising
![Page 67: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/67.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 67
LO9
Consumer Privacy
Gramm-Leach-Bliley Act
Health Insurance Portability and Accountability Act (HIPPA)
California’s Notice of Security Breach Law
Government ActionsGovernment Actions
![Page 68: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/68.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 68
REVIEW LEARNING OUTCOMELO9
Political and Legal Environment of Marketing
![Page 69: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/69.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 69
Explain the basics of foreign and domestic
competition
Competitive FactorsCompetitive FactorsLO10
![Page 70: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/70.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 70
Competitive Factors
LO10
How many competitors?
How big are competitors?
How interdependent isthe industry?
Control
![Page 71: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/71.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 71
Competitive Factors
LO10
Competition for Market Share and Profits
Global Competition
Firms must work harder to maintain profits and market share.
More foreign firms are entering U.S. market.
Foreign firms in U.S. now compete on product quality.
![Page 72: Chapter 3Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 1 MKTG Designed by Amy McGuire, B-books, Ltd. Prepared by.](https://reader037.fdocuments.net/reader037/viewer/2022110100/56649de45503460f94adc3e9/html5/thumbnails/72.jpg)
Chapter 3 Copyright ©2008 by South-Western, a division of Thomson Learning. All rights reserved 72
REVIEW LEARNING OUTCOMELO1
0
Political and Legal Environment
Mature Industries
Slow Growth / No Growth
Highly Competitive Marketplace
Can only increasemarket share bytaking it from a competitor.