Name:_____________________________ Chapter 3 Discussion Questions Review 1.

Name and describe the elements of a companys microenvironment and give an example showing why each is important. Microenvironment consists of the actors clos to the company that affects its ability to serve its customersthe company, suppliers, marketing intermediaries, customer markets, competitors and publics. When designing a marketing plan marketing management must consider different groups such as top management, finance, research and development, purchasing, operations, and accounting. All these interrelated groups from the internal environment. Suppliers are particularly important because they provide the basic resources the company needs to produce their products and are integral to the companys overall value delivery system. The company needs to study five types of customer markets closely; consumer markets, business markets, reseller markets, government markets and international markets. According to the marketing concept, to be successful marketers must provide greater customer value and satisfaction than its competitors do. Thus, marketers must do more than simply adapt to the needs of target consumers. They also must gain strategic advantage by positioning their offerings strongly against competitors in the minds of consumers. Finally, the companys marketing environment also includes various publics- any group that has an actual of potential interest in or impact on an organizations ability to achieve its objectives. Seven types are identified: financial, media, citizen action, local, general, government and internal publics. 2. What is demography and why are marketers interested in it? List some of the demographic trends of interest to marketers. Demography is the study of human populations in terms of size, density, location, age, gender, race, occupation and other statistics. The demographic environment is of major interest to marketers because it involves people, and people make up markets. The major trends discussed in the chapter include the changing age structure of the population, the changing American family, geographic shifts in population, a better educated, more white collar, more professional population and increasing diversity.

3. Discuss the trends in the natural environment that marketers must be aware of and provide examples of companies responses to them. The natural environment involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities. Marketers should be aware of several trends in the natural environment. Growing shortages of raw materials. Marketers need to rely less on nonrenewable resources and use renewable resources more wisely, Increased pollution. Industry will almost always damage the quality of the natural environment. Increase government intervention in natural resource management. The governments of different countries vary in their efforts to promote a clean environment. The general hope is that companies around the world will accept more social responsibility, and that less expensive devices can be found to control and reduce pollution. Companies responses to more environmentally friendly trends have been improving. They are responding to consumer demands with more environmentally responsible products, such as recyclable or biodegradable packaging, recycled materials and components, better pollution controls and more energy-efficient operations. More and more, they are recognizing the link between a healthy ecology and a healthy economy. They are learning that environmentally responsible actions can also be good business. 4. Discuss reasons why business legislation is enacted. What role do businesses and industry groups play in shaping such legislation? Business legislation has been enacted for a number of reasons: To protect companies from each other. Laws define and prevent unfair competition. In the United States, such laws are enforced by the Federal Trade Commission and the Antitrust Division of the Attorney Generals office. To protect consumers from unfair business practices. Some firms, if left alone, would make shoddy products, invade consumer privacy, tell lies in their advertising, and deceive consumer through their packaging and pricing. Unfair business practices have been defined and are enforced by various agencies. To protect the interests of society against unrestrained business behavior. Profitable business activity does not always create a better quality of life. Regulation arises to ensure that firms take responsibility for the social costs of their production or products.

5. Compare and contrast core beliefs/values and secondary beliefs/values. Provide an example of each and discuss the potential impact marketers have on each. Core beliefs and values are passed on from parents to children and are reinforced by schools, churches, business, and government. Secondary beliefs and values are more open to change. Believing in marriage is a core belief; believing that people should get married early in life is a secondary belief. Marketers have some chance of changing secondary values but little chance of changing core values. 6. How should marketers respond to the changing environment? Many companies view the marketing environment as an uncontrollable element to which they must react and adapt. They passively accept the marketing environment and do not try to change it. They analyze the environmental forces and design strategies that will help the company avoid the threats and take advantage of the opportunities the environment provides. Other companies take a proactive stance toward the marketing environment. Rather than simply watching and reacting, these firms take aggressive actions to affect the publics and forces in their marketing environment. Such companies hire lobbyists to influence legislation affecting their industries and stage media events to gain favorable press coverage. However, marketing management cannot always control environmental forces. For example, a company would have little success trying to influence geographic population shifts, the economic environment or major cultural values.