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Chapter 4: Evaluating Opportunities in the Changing Marketing Environment

Chapter 4: Evaluating Opportunities in the Changing Marketing Environment. 1. Know the variables that shape the environment of marketing strategy planning. 2. Understand why company objectives are important in guiding marketing strategy planning.

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Chapter 4: Evaluating Opportunities in the Changing Marketing Environment

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  1. Chapter 4: Evaluating Opportunities in the Changing Marketing Environment

  2. 1. Know the variables that shape the environment of marketing strategy planning. 2. Understand why company objectives are important in guiding marketing strategy planning. 3. See how the resources of a firm affect the search for opportunities. 4. Know how the different kinds of competitive situations affect strategy planning. 5. Understand how the economic and technological environment can affect strategy planning. 6. Know why you might be sent to prison if you ignore the political and legal environment. 7. Understand how to screen and evaluate marketing strategy opportunities. 8. Understand the important new terms. Chapter 4 Objectives When you finish this chapter, you should 4-2

  3. Provide Guidelines Be Explicit Setting Company Objectives Coordinate Effort Lead to Marketing Objectives The Importance of Objectives 4-3

  4. Company Objectives Production Objectives Finance Objectives Marketing Objectives HR Objectives R&D Objectives Product Objectives Place Objectives Promotion Objectives Price Objectives Personal Selling Objectives Mass Selling Objectives Sales Promotion Objectives A Hierarchy of Objectives Exhibit 4-1 4-4

  5. Financial Strength ????? ????? ????? ????? ????? Producing Capability and Flexibility Marketing Strengths Limits on Opportunity Search 4-5

  6. The Competitive Environment Kinds of Markets Competitor Analysis Key Concepts in the Competitive Environment Competitive Rivals Competitive Barriers Information on Competitors 4-6

  7. Global Economy Rapid Change Key Economic Forces Interest Rates The Economic and Technological Environment 4-7

  8. The Impact of Technology • Technology is the application of science to convert and economy’s resources to output • Technology impacts marketing both through opportunities for new products and new ways (processes) for handling marketing functions • Example: consider the Internet • Products: software for computer users • Process: selling from a web site 4-8

  9. Nationalism Consumerism Characteristics of the Political Environment Regional Groupings The Political and Legal Environment 4-9

  10. Some Important U.S. Federal Regulatory Agencies Agencies Responsibilities Federal Trade Commission (FTC) Enforces laws and develops guidelines regarding unfair business practices Food and Drug Administration (FDA) Enforces laws and develops regulations to prevent distribution and sale of hazardous consumer products Consumer Product Safety Commission Enforces Consumer Product Safety Act(CPSC) Federal Communications Commission Regulates interstate wire, radio, and (FCC) television Environmental Protection Agency (EPA) Develops and enforces environmental protection standards Office of Consumer Affairs (OCA) Handles consumer complaints Exhibit 4-4 4-10

  11. Time Poverty Economic Power Cultural Trend: The Changing Roles of Women Career Opportunity The Cultural and Social Environment 4-11

  12. Product A Sales Total cost Dollars 0 1 2 3 4 5 Years Sales and Cost Curves ofTwo Strategies In this graphic, a too-narrow focus on the first year’s results might cause the marketing manager to abandon this product as too costly. Exhibit 4-6 4-12

  13. Product B Sales Total cost 0 1 2 3 4 5 Years Sales and Cost Curves of Two Strategies In this graphic, a too-narrow focus on the first year’s results might cause the marketing manager to adopt the product prematurely, since its performance in year one is misleading. Exhibit 4-6 4-13

  14. Product A Product B Sales Sales Total cost Total cost Dollars 0 1 2 3 4 5 0 1 2 3 4 5 Years Years Seen together, it is easy to see that Product A offers a vastly better overall return than does Product B Sales and Cost Curves of Two Strategies Exhibit 4-6 4-14

  15. Industry Attractiveness High Medium Low High Business Strength Medium No Growth Borderline Low Growth Evaluating Opportunities Exhibit 4-7 4-15

  16. Insensitive Sensitive Continuum of Environmental Sensitivity Industrial products Basic commodity-type consumer products Consumer products that are linked to cultural variables Exhibit 4-8 4-16

  17. Key Terms Mission Statement Competitive Environment Competitor Analysis Competitive Rivals Competitive Barriers Economic and Technological Environment Technology Nationalism NAFTA Consumerism Cultural and Social Environment Strategic Business Unit (SBU) Portfolio Management 4-17

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