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Chapter 2
MACRO ENVIRONMENT
To succeed in marketing, we must learn to accommodate the external uncontrollable factors. These factors act as constraints at all levels. In other words they limitation on freedom of action.
MACRO ENVIRONMENT
Demography Economic Environment Social Cultural Environment Political and Legal Environment Competition Consumer Demand Ecology International Environment
MACRO ENVIRONMENT
Study of the demography of India helped McDonalds develop products which were more inexpensive since Indians are price sensitive
Seen here, economic indicators show the rise in car prices over time. This is due to rise in input costs which is a part of the economic environment
MACRO ENVIRONMENT
McDonalds did not use beef or pork in their burgers in India since beef and pork is a taboo. As an alternative they chose other meats like chicken
Govt of India is responsible for changes in prices of fuel such as LPG and petrol. This affects the revenue of oil companies and also the quality of products they have to offer.
MACRO ENVIRONMENT
Coke and Pepsi are regularly at war termed as Cola Wars. This is an effect of competition in the soft drink industry.
Demand of products by consumers have several determinants. Luxury products have lowest demand while essential goods have highest
MACRO ENVIRONMENT
Eco friendly products such as neem pencils and paper are gaining importance since customers want products that do not harm the environment.
This link will give you an example of how international trade policies can affect sales of products. http://www.rediff.com/money/20 07/apr/13bike.htm
MICRO ENVIRONMENT
Organization Corporate Resources Marketing Mix Markets Supplies Marketing Intermediaries Employees
Organization:
Intel was founded in Mountain View, California in 1968 by Gordon E. Moore (of "Moore's Law" fame, a chemist and physicist) and Robert Noyce (a physicist and co-inventor of the integrated circuit) when they left Fairchild Semiconductor. Intel's third employee was Andy Grove, a chemical engineer, who ran the company through much of the 1980s and the high-growth 1990s.
Corporate Resources The high growth of Intel gave them very good profits at an early stage of incorporation. In terms of human resource talent, Intel had some of the best and still hires the best talent for its operations. Their biggest expense is R&D where people develop new, faster and more efficient processors.
Marketing Mix Intel makes processors for several types of computers; desktop, laptops, notebooks, servers and even GPUs. They also make motherboards. Intel products are available globally and are at an affordable price.
Markets Intel products are sold to computer manufacturers such as Dell. Where their biggest sale includes the Atom 450 processor for notebooks. Microsoft uses Intel Xenon for its X-box processor requirements. Intels i-core series is also available to consumers in retail as well.
Supplies Lynnfield Processors is one of main supplier to the iCore series of processors by Intel. The other suppliers include: AceCo Precision Manufacturing; Advanced Semiconductor Engineering, Inc.; ASML; Cabot Microelectronics Corporation; Cisco Systems, Inc.; DAIFUKU; FUJIFILM Electronic Materials; Grohmann Engineering; Hirata Corporation; Nikon Corporation; Nippon Mining & Metals Co., Ltd.; Nordson ASYMTEK; Praxair Electronics; Rofin-Baasel; Skanska; and Tokyo Electron Limited.
Marketing Intermediaries Since most of Intels products are to be imported, it employs an agency to manage the imports. The agency sells to wholesalers who in turn make it available to different retailers.
Employees Intel is known for providing some of the best benefits to its employees. They provide work from home, flexible timings options to their employees. More information can be found on http://www.intel.com/lifeatintel/lifework/
MARKETING MIX
A marketing mix is a combination of product offerings used to reach the target market for the organization.. The elements or variables that make up the marketing mix are:
Decision on product or service b) Decisions on price c) Decisions on promotion d) Decisions on distribution
a)
MARKETING MIX
MARKETING MIX
Product
Place
Marketing Mix
Price
Promotion
MARKETING MIX
MARKET SEGMENTATION
It is the process of subdividing a market into distinct groups of customers with similar needs. Each subset of the market is selected as a target market and can be reached with a distinct marketing mix. Each sub group is characterized by particular tastes and requiring specific marketing mix.
MARKET SEGMENTATION
BENEFITS OF SEGMENTATION
Marketers are in a better position to locate and compare their opportunities When consumer needs are analyzed the marketers can formulate effective marketing programmes which will be tuned to the demands of the market. Marketers can make finer adjustments in their products and marketing communications. Competitors strengths and weaknesses can be understood effectively Segmentation leads to effective usage of resources because the customer is focused on in the marketing efforts and only target markets are served
Geographic
Benefits
Usage
Psychological
Loyalty
Occasion
Chik Shampoo was the 1st company to make shampoos in a sachet format and was able to enter the rural markets because of this change
Psychographics segmentation can be broken down into lifestyle and personality characteristics:
Personality Lifestyle
Viewer personality for Discovery science includes techies and school students. While viewer personality of NDTV Good Times includes housewives, college students and retired folk
Designer labels are meant for the lifestyle of the upper class. Who prefer unique, one of a kind clothes.
The approach has segmentation based on buyer behaviour. Usage: total usage of a family unit for a given product may act as a basis for segmentation. A buyer may be classified as heavy, medium and light users and non users. Marketer is usually interested in these heavy users.
Benefit: consumers are divided into various smaller segments each seeking a different type of benefit from the product Loyalty: They can create product preference scale. Buyers compare existing products based on their liking. That way seller can understand consumers who are loyal, moderately loyal and fickle minded. Occasion: This determines which situations produce optimal consumption patterns for a given product
Usage of products like toothpaste is regular and hence shows consumers buy this more often.
Different variants of sunsilk are sought after by different consumers who have different hair problems or textures
Customer loyalty is developed when good quality products are offered. Those who buy products of Apple are seen to be very loyal towards the company since the company offers products of very high quality
MARKET TARGETTING
A target market or target audience is a group of customers that the business has decided to aim its marketing efforts and ultimately its merchandise
For several years, Maruti Suzuki focused its products only on one segment that was small cars. Maruti 800 was their biggest success in India
Different products of Pepsi use different marketing mix. This is an example for their selective targeting strategy
Chocolates from Cadbury all come from same manufacturer but each chocolate is sold to a different segment. Like Gems is targeted at kids while 5 Star for college students