marketing of financial services _ products - lecture 2

8/7/2019 Marketing of Financial Services _ Products - Lecture 2

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AnalysingAnalysing the Marketingthe MarketingEnvironmentEnvironment

Lecture 2Lecture 2

The marketing environment consists of

actors and forces outside the organization

that affect managements ability to build

and maintain relationships with target

customers.

Environment offers both opportunities

and threats.

Marketing intelligence and research used

to collect information about the

environment.

Includes:

Micro-environment: actors close to the

company that affect its ability to serve

its customers.

Macro-environment: larger societal

forces that affect the

microenvironment.

Considered to be beyond the control

of the organization.

Company

Demographic

Economic

Natural

Technological

Political

Cultural

Company

Customers

Intermediaries

Suppliers

Competitors

Publics

The CompanyThe CompanyssMicroenvironmentMicroenvironment

Companys Internal Environment:

Areas inside a company.

Affects the marketing departments

planning strategies.

All departments must think consumer

and work together to provide superior

customer value and satisfaction.


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Actors in theActors in theMicroenvironmentMicroenvironment

Companys Internal Environment:

functional areas such as top

management, finance, and

manufacturing, etc.

The Companys Microenvironment

Suppliers:

Provide resourcesneeded to producegoods and services.

Important link inthe value deliverysystem.

Most marketerstreat suppliers likepartners.



Marketing Intermediaries:

Help the company to promote, sell, and

distribute its goods to final buyers

Resellers

Physical distribution firms

Marketing services agencies

Financial intermediaries


Partnering With Intermediaries

Coca-Cola providesWendys with muchmore than just softdrinks. It also pledgespowerful marketingsupport.


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Customers:

Several types ofmarkets that purchase

a companys goods and

services

Customer v/s

consumer

five types of markets

that purchase a

companys goods and

services


CompanyCompany

ConsumerMarkets

InternationalMarkets

GovernmentMarkets

BusinessMarkets

ResellerMarkets


Competitors:

Those who serve atarget market withproducts and servicesthat are viewed byconsumers as beingreasonable substitutes

Company must gainstrategic advantageagainst theseorganizations


Publics:

Group that has an interest in or

impact on an organization's ability to

achieve its objectives

Types of Publics

The CompanyThe CompanyssMacroenvironmentMacroenvironment


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The company and all

of the other actors

operate in a larger

macroenvironment of

forces that shape

opportunities and

pose threats to the

company.

Demographic Forces The Companys Macroenvironment

Demographic:

The study of human populations in terms ofsize, density, location, age, gender, race,occupation, and other statistics.

Marketers track changing age and familystructures, geographic population shifts,educational characteristics, and populationdiversity.

The Key U.S. Demographic Trends


Changing Age StructurePopulation is getting older

Changing Age StructurePopulation is getting older

Changing Family StructureMarrying later, fewer children,

working women, and nonfamily households

Changing Family StructureMarrying later, fewer children,

working women, and nonfamily households

Geographic Shift sMoving to the Sunbelt and suburbs (MSAs)

Geographic Shift sMoving to the Sunbelt and suburbs (MS As)

Increased Educati onIncreased college attendance

and white-collar workers

Increased Educati onIncreased college attendance

and white-collar workers

Growing Ethnic and Racial Diversity73% Caucasian, 12% African-American,

10% Hispanic & 3.4% Asian

Growing Ethnic and Racial Diversity73% Caucasian, 12% African-American,10% Hispanic & 3.4% Asian

The Seven U.S. Generations


Baby Boomers

78 million born between 1946 and 1964

Account for 28% of population

Earn more than half of all personal

income Almost 25% belong to racial or ethnicminority

Spend a lot on anti-aging products andservices

Are likely to postpone retirement



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Generation X

45 million born between 1965 and 1976 Defined by their shared experiences

Increasing divorce rates

More of their mothers employed

First generation of latchkey kids

Cynical of frivolous marketing pitches

Care about the environment

Prize experience, not acquisition


Generation Y

72 million born between 1977 and 1994 Have large amount of disposable income

Comfortable with computer technology

Tend to be impatient and Now-Oriented

Many product lines targeted at Gen Ys


Changing American Family


Household makeup:

Married couples with children = 34%, andfalling

Married couples and people living with otherrelatives = 22%

Single parents = 12%

Single persons and adult live-togethers =32%

Changing American Family


Non-family householdssingle live-alones or adultlive-togethers of one orboth sexesmake up a full32 percent of U.S.households. Todaysmarketers must i ncorporatethe likes of MurphyBrown, Ally McBeal, andWill and Grace into theirbusiness plans.

Better Educated Population


1980: 69% of people over age 25 completed high

school

17% had completed college

2002: 84% of people over age 25 completed high

school

27% had completed college

Currently, of high school grads startcollege

More White-Collar Population


1950 1985:

Proportion of white-collar workers increasedfrom 41% to 54%

Proportion of blue-collar workers decreased

from 47% to 33% Proportion of service workers increased from

12% to 14%

1983 1999:

Proportion of managers and professionalsincreased from 23% to >30%


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Increasing Diversity


U.S. is a salad bowl Various groups mixed together, each

retaining its ethnic and culturaldifferences

Increased marketing to:

Gay and lesbian consumers

People with disabilities www.peapod.com

Diversity-Based Advertising


Based on careful study of cultural differences, Bank of A merica hasdeveloped targeted advertising messages for different culturalsub roups, here Asians and Hispanics.

Economic Forces The Companys Macroenvironment

Economic Environment

Changes in Income 1980s consumption

frenzy

1990s squeezedconsumer

2000s value marketing

Income Distribution Upper class

Middle class

Working class

Underclass

Consists of factors that affect consumerpurchasing power and spending patterns.


Changesin Consumer

SpendingPatterns

Changesin Consumer

Spending

Patterns

EconomicDevelopment

EconomicDevelopment

Changesin Income

Changesin Income

KeyEconomic

Concerns forMarketers

KeyEconomic

Concerns forMarketers


Income Distribution

Walt Disney markets two distin ct Pooh bears to match itstwo-tiered market.

Natural Forces The Companys Macroenvironment

Natural Environment

Involves the naturalresources that areneeded as inputs by

marketers or that areaffected by marketingactivities.


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Factors Impacting the Natural Environment

Shortages of Raw Materials

Increased Pollution

Increased Government Intervention

Environmentally Sustainable Strategies


Environmental Responsibility

McDonalds has made a substantial commitment to theso-called green movement.

Technological Forces The Companys Macroenvironment

Technological Environment

Most dramaticforce nowshaping ourdestiny.

Technological Forces The Companys Macroenvironment

Changes rapidly.

Creates new marketsand opportunities.

Challenge is to makepractical, affordableproducts.

Safety regulationsresult in higherresearch costs andlonger time betweenconceptualization and

introduction ofproduct.

Political Forces The Companys Macroenvironment

Includes Laws,GovernmentAgencies, andPressureGroups that

Influence orLimit VariousOrganizationsand IndividualsIn a GivenSociety.

Increasing Legislation

Changing GovernmentAgency Enforcement

Increased Emphasis onEthics & Socially

Responsible Actions

Cultural Forces The Companys Macroenvironment

Cultural Environment

The institutionsand other forcesthat affect a

societys basicvalues,perceptions,preference, andbehaviors.


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Core beliefs and values are passed onfrom parents to children and are

reinforced by schools, churches, business,

and government.

Secondary beliefs and values are more

open to change.


ThemselvesThemselves

OthersOthers

OrganizationsOrganizations

SocietySociety

NatureNature

The UniverseThe Universe

Societys MajorCultural Views

Are Expressed inPeoples Views of:

SWOTSWOTAnalysisAnalysis

SWOT Analysis

Opportunities

Strengths

Threats

Weaknesses Internal(controllable)

External(uncontrollable)

Source

Five ForcesFive ForcesAnalysisAnalysis

Source: Adapted from M. E. Porter,Competitive Strategy, Free Press,

1980, p. 4.

Threat ofThreat of

substitutessubstitutes

Potential

entrants

Threat ofThreat of

entrantsentrants

Suppliers

BargainingBargainingpowerpower

Substitutes

Buyers

BargainingBargainingpowerpower

COMPETITIVE

RIVALRY

marketing of financial services _ products - lecture 2

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