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ExternalEnvironmentAnalysisMainAreasofFocus•Demographic•Economic•Social-Cultural•Political-Legal•Technological•CompetitiveExternalEnvironmenta

ndtheMarketingMix•Competitive•Technological•Economic•Political-Legal•Demographic•Social-CulturalPriceProductPlacePromotionTargetMarketExte

rnalEnvironment:Demographic•PopulationGrowthRate•PopulationAgeMix•PopulationDispersion•Ethnicity•Educatio

nExternalEnvironment:Economic•Income•BusinessCycles•Inflation•Unemployment•IncomeDistributionExternalEnviron

ment:EconomicIncome:ImportantTermstoRemember1.DisposableIncome:whatconsumershaveleftaftertaxesarepaid.2.DiscretionaryIncome:whatconsumershavelef

taftertaxesandnecessitiesarepaidfor3.Engel’sLaw:theincomeprofileofaneconomymovesfromdisposabletodiscretionaryasaneconomydevelopsEx

ternalEnvironment:Social-Cultural•Socialclasses•Culture•ValuesExternalEnvironment:Social-CulturalValuesguidebehaviorandcan

defineneeds.Valuesaredefinedaswidelyheldbeliefsthatsomeactivities,relationships,feelings,orgoalsareimportanttoacommuni

ty’swell-being.Valuesareimportanttomarketers,because:1)Theyguideculturallyappropriatebehavior,2)Theyaredifficulttochange,3)Theyarewidelyaccepte

d,and4)Theyinclinepeopletorespondtospecificstimuliinstandardways.ExternalEnvironment:Social-CulturalValuesCategories

thatareusefultomarketers:•Coreandsecondaryvalues:Corevaluesarehighlypersistent;secondaryvaluesaremuchmorelikelytochange.•S

ubcultureandculturalvalues:Subcultureareseparatesegmentsofacultureorganizedaroundfactorsasrace,nationality,reli

gion,orgeographiclocation.•Instrumentalandterminalvalues:Instrumentalvaluesfocusonmodesofconduct(i.e.ambition);terminalvaluesdealwithend-stat

esofexistence(i.e.prosperity).•Materialandnon-materialvalues:Materialvaluespertaintothings(thatpeoplecanbuyand

wheretobuythemi.e.);whilenonmaterialvaluesdealwithideas,customs,andbeliefs(i.e.religionandpoliticalorientation).Extern

alEnvironment:Political-LegalImportantAreasofFocus•Generalmonetaryandfiscalpolicies•Broadsociallegislationan

daccompanyingregulatoryagencypolicies•Governmentrelationswithindividualindustries•LegislationrelatedtomarketingFortunately,thepolitica

l-legalenvironmenttendstochangeslowly.ExternalEnvironment:TechnologicalQuestionstoConsider:•Couldtechnologycreatenewgoodsandservicestos

ell?•Couldtechnologyimproveexistingproductsand/orservices?•Couldtechnologyreducepricesthroughcost-efficientmanufacturingand

distributionprocesses?ExternalEnvironment:CompetitiveTypesofcompetitiontoconsider:•Brand:competitionfromothercompaniesthat

offersimilarproductsorservices•Form:competitionfromotherformsofyourproductorservice(internal)•Generic:competitionfromcompaniesthatofferdi

fferentproductsorservices,butcouldperformessentiallythesamefunction•Desire:competitionwithallotherdesiresthatcustomersmightsa

tisfybeforepurchasingyourproductorserviceExternalEnvironment:CompetitiveCompetitiveClimates:Monopoly,Importantdimensions•Uniquenessofeachfirm’sproduc

t:unique•Numberofcompetitors:none•Sizeofcompetitors(relativetomarket):none•Elasticityofdemandfacingfirm:either•Elasticityofindustrydemand:e

ither•Controlofpricebyfirm:completeExternalEnvironment:CompetitiveCompetitiveClimates:Oligopoly,Importantdimensions•Uniquenessofeachfirm’sproduct:

none•Numberofcompetitors:few•Sizeofcompetitors(relativetomarket):large•Elasticityofdemandfacingfirm:kinked•Elasticityofindustr

ydemand:inelastic•Controlofpricebyfirm:some(ifcareful)ExternalEnvironment:CompetitiveCompetitiveClimates:PureCompetition,Imp

ortantdimensions•Uniquenessofeachfirm’sproduct:none•Numberofcompetitors:many•Sizeofcompetitors(relativetomarket):

small•Elasticityofdemandfacingfirm:completelyelastic•Elasticityofindustrydemand:either•Controlofpricebyfirm:noneExt

ernalEnvironment:CompetitiveCompetitiveClimates:MonopolisticCompetition,Importantdimensions•Uniquenessofeach

firm’sproduct:some•Numberofcompetitors:fewtomany•Sizeofcompetitors(relativetomarket):largetosmall•Elasticityofdemandfacingfi

rm:either•Elasticityofindustrydemand:either•Controlofpricebyfirm:some