Lamb, Marketing 5CE, Chapter 3, Student Handout

Transcription

1 Lecture PowerPoint slides to accompany Canadian Adaptation prepared by Don Hill, Langara College 1 Chapter 3: Ethics and the Marketing Environment 2 Learning Outcomes LO 1 LO 2 LO 3 LO 4 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 Describe the social factors that affect marketing 3 Copyright 2012 Nelson Education Limited. All rights reserved. 1

2 Learning Outcomes LO 5 LO 6 LO 7 Explain the importance to marketing managers of current demographic trends Explain the importance to marketing managers of multiculturalism and growing ethnic markets Identify consumer and marketer reactions to the state of the economy 4 Learning Outcomes LO 8 LO 9 LO 10 Identify the impact of technology on a firm Discuss the political and legal environment of marketing Explain the basics of foreign and domestic competition 5 Corporate Social Responsibility LO 1 Discuss corporate social responsibility. 6 Copyright 2012 Nelson Education Limited. All rights reserved. 2

3 Sustainability The idea that socially responsible companies will outperform their peers by focusing on the world s social problems, viewing them as opportunities to build profits and help the world at the same time. LO 1 7 LO 1 Review Learning Outcome Discuss Corporate Social Responsibility Philanthropic Be a good citizen. Ethical Do what is right. Legal Obey the Law. Economic Be profitable. 8 Green Marketing The development and marketing of products designed to minimize negative effects on the physical environment or to improve the environment. LO 1 9 Copyright 2012 Nelson Education Limited. All rights reserved. 3

4 Ethical Behavior LO 2 Describe the role of ethics and ethical decisions in business. 10 Ethical Behavior Ethics The moral principles or values that generally govern the conduct of an individual. id LO 2 11 Ethical Behavior in Business Morals The rules people develop as a result of cultural values and norms. LO 2 12 Copyright 2012 Nelson Education Limited. All rights reserved. 4

5 Ethical Development Levels More Childlike Preconventional Morality Based on what will be punished or rewarded Self-centered, calculating, selfish Conventional Morality Moves toward the expectations of society Concerned over legality and the opinion of others More Mature Postconventional Morality Concern about how they judge themselves Concern if it is right in the long run LO 2 13 Ethical Decision Making Influential Factors Extent of Problems Top Management Actions on ethics Potential Magnitude of the Consequences Probability of Harm Time Until Consequences Number Affected Social Consensus LO 2 14 Code of Ethics Code of Ethics- A guideline to help marketing managers and other employees make better decisions. i LO 2 15 Copyright 2012 Nelson Education Limited. All rights reserved. 5

6 Creating Ethical Guidelines Helps identify acceptable business practices Helps control behaviour internally Avoids confusion in decision making Facilitates discussion about right and wrong LO 2 16 Ethics Checklist Exhibit 3.3 LO 2 17 LO 3 Review Learning Outcome Describe the Role of Ethics and Ethical Decisions in Business 18 Copyright 2012 Nelson Education Limited. All rights reserved. 6

7 The External Marketing Environment LO 3 Discuss the external environment of marketing, and explain how it affects a firm 19 Target Market Target market- A defined group most likely to buy a firm s product. LO 3 20 Understanding the External Environment Environmental Scanning Goal to Identify Future Market Opportunities And Threats LO 3 21 Copyright 2012 Nelson Education Limited. All rights reserved. 7

8 LO 3 Review Learning Outcome External Environment of Marketing Internal (within the organization) Marketing mix Product Distribution Promotion Price External Environment (uncontrollable) Demographics Competition Environmental Scanning Target Market Technology Social Change Ever-Changing Marketplace Economic Conditions Political & Legal Factors 22 Social Factors LO 4 Describe the social factors that affect marketing. 23 Social Factors Attitudes Values Lifestyle LO 4 24 Copyright 2012 Nelson Education Limited. All rights reserved. 8

9 Social Factors Self-Sufficiency Basic Canadian Values Upward Mobility Work Ethic Conformity LO 4 25 Social Factors Social Factors Values Component Lifestyles Changing Role of Women LO 4 26 Component Lifestyles The practice of choosing goods and services that meet one s diverse needs and interests rather than conforming to a single, traditional lifestyle. LO 4 27 Copyright 2012 Nelson Education Limited. All rights reserved. 9

10 Role of Families and Working Women The phenomena of working women has had the greatest effect on marketing than any other social change Nearly two-thirds of all women (ages 18-65) are in the workforce Purchasing power from dual-career families is rising Less time for family activities Cost is more important to women. Quality is more important to men. LO 4 28 LO 2 Review Learning Outcome Social Factors that Affect Marketing 29 Demographic Factors LO 3 Explain the importance to marketing managers of current demographic trends. 30 Copyright 2012 Nelson Education Limited. All rights reserved. 10

11 Demographic Factors Demography- The study of people s vital statistics, such as their age, race and ethnicity, and location. LO 5 31 Demographic Facts LO 5 32 Tweens Pre- and early adolescents, age 9 to 14 Population of 2.3 million Purchasing power of $2 billion annually View TV ads as just advertising LO 5 33 Copyright 2012 Nelson Education Limited. All rights reserved. 11

12 Teens Population of 3 million in Canada Purchasing power of $10 billion annually Approximately 70 hours per week tuned in electronically Participate in social networks Shopping has become social sport Connected LO 5 34 Generation Y Born between 1979 and 1994 Population of 7 million Purchasing power of $20 billion annually Researchers have found Gen Yers to be: Impatient Family-oriented Inquisitive Opinionated Diverse Time managers Street Smart Connected LO 5 35 Generation X Born between 1965 and 1978 Population of 6.7 million Savvy and cynical consumers More protective and involved with their kids Value the importance of education Avid buyers of the latest clothes, technology, and recreational products LO 5 36 Copyright 2012 Nelson Education Limited. All rights reserved. 12

13 Baby Boomers Born between 1946 and 1964 Population of 9 million the largest demographic segment Many Boomers expect to continue working past 65. Account for a significant part of shopping dollars spent on packaged goods Four segments of baby boomers: Looking for balance Confident and living well At ease Overwhelmed LO 5 37 Older Consumers Over 65 Population of 4.7 million Wealthier, healthier, and better educated than earlier generations Keep up with the times, definite about wants and needs, and have unique behaviour patterns Feel that marketers ignore them Fastest growing segment LO 5 38 LO 5 Review Learning Outcome Current Demographic Trends 39 Copyright 2012 Nelson Education Limited. All rights reserved. 13

14 Growing Ethnic Markets LO 6 Explain the importance of marketing managers of multiculturalism and growing ethnic markets. 40 Visible Minority Persons, other than Aboriginal peoples, who are non-caucasian in race or non-white in colour. LO 6 41 Growing Ethnic Markets Immigrant s are the main source of population growth Nearly 250,000 arriving each year Three-quarters of the immigrants arriving are visible minorities Currently 16 percent of Canadians are visible minorities Expected to grow to 31 percent by 2031 LO 6 42 Copyright 2012 Nelson Education Limited. All rights reserved. 14

15 Visible Minorities in Canada LO 6 43 Ethnic and Cultural Diversity Multiculturalism: occurs when all major ethnic groups in an area (city, county, or census metropolitan area) are roughly equally represented Canadian trend is toward greater multiculturalism Greatest multiculturalism is in the largest metropolitan areas LO 6 44 Implications of Multiculturalism Diversity can result in bottom-line benefits to companies Ethnic markets are not homogeneous Many niches requiring micromarketing strategies Growth in Internet usage within ethnic markets outpaces the general public LO 6 45 Copyright 2012 Nelson Education Limited. All rights reserved. 15

16 LO 6 Review Learning Outcome Multiculturalism and Growing Ethnic Markets 46 Economic Factors LO 7 Identify consumer and marketer reactions to the state of the economy. 47 Economic Factors Consumer s Income Inflation Recession LO 7 48 Copyright 2012 Nelson Education Limited. All rights reserved. 16

17 Consumers Incomes Median Canadian household income in 2010 was approximately $66,550. Incomes have risen at a slow pace. New level of affluence cuts across all household types. Not limited to professionals, age or education LO 7 49 Purchasing Power Purchasing Power- A comparison of income versus the relative cost of a set standard of goods and services in different geographic areas. LO 7 50 Inflation Inflation- A measure of the decrease in the value of the money, expressed as the percentage reduction in value since the previous year. LO 7 51 Copyright 2012 Nelson Education Limited. All rights reserved. 17

18 Recession Recession- A period of economic activity characterized by negative growth which reduces demand for goods and services. LO 7 52 Recession Marketing Strategies Redouble efforts to cut costs Lower prices to attract new customers and hold existing ones LO 7 53 LO 7 Review Learning Outcome Economic Factors 54 Copyright 2012 Nelson Education Limited. All rights reserved. 18

19 Technological Factors LO 8 Identify the impact of a technology firm. 55 Research Basic research pure research that aims to confirm an existing theory or to learn more about a concept or phenomenon Applied research an attempt to develop new or improved products LO 8 56 Technological Factors New technology is a weapon against inflation and recession Canada excels at basic research and is improving at applied research. Information technology and the Internet have been driving increased productivity Many firms use the marketing concept to guide research. LO 8 57 Copyright 2012 Nelson Education Limited. All rights reserved. 19

20 Technological Factors New technology creates a long-term competitive advantage. The most innovative firms have an average profit margin growth of 3 percent higher than the typical firm. LO 8 58 LO 8 Review Learning Outcome Impact of Technology on a Firm Basic Research Applied Research Technology Advances Marketing Mix 59 Political and Legal Factors LO 9 Discuss the political and legal environment of marketing. 60 Copyright 2012 Nelson Education Limited. All rights reserved. 20

21 Political and Legal Factors Laws and Regulations Protect: New technology Society Businesses Consumers LO 9 61 Competition Bureau Competition Act Packaging and Labelling Act Textile Labelling Act Precious Metals Act Competition Bureau LO 9 62 LO 9 Review Learning Outcome Political and Legal Environment of Marketing Protecting Consumer Protecting Business Federal Legislation Provincial Legislation Self-Regulation 63 Copyright 2012 Nelson Education Limited. All rights reserved. 21

22 Competitive Factors LO 10 Explain the basics of foreign and domestic competition. 64 Competitive Factors How many competitors? How big are competitors? Specific strategies? How strong and aggressive? How interdependent is the industry? LO Competitive Factors Competition for Market Share and Profits Firms must work harder to maintain profits and market share. Global Competition More foreign firms are entering Canadian market. kt Foreign firms in Canada now compete on product quality. LO Copyright 2012 Nelson Education Limited. All rights reserved. 22

23 LO 10 Review Learning Outcome Foreign and Domestic Competition Highly Competitive Marketplace Can only increase market share by taking it from a competitor. Mature Industries Slow Growth / No Growth 67 Copyright 2012 Nelson Education Limited. All rights reserved. 23