2/23/2020

“It is useless to tell a river to stop

running; the best thing is to learn
how to swim in the direction it is
Chapter 4 flowing.”
-Anonymous
The Marketing
Environment

©2006 Pearson Education, Inc. Marketing for Hospitality and Tourism, 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler, Bowen, and Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

Chapter Objectives Chapter Objectives

• List and discuss the importance of the • Identify the major trends in the firm’s natural
elements of the company’s microenvironment and technological environments

• Describe the macroenvironmental forces that • Explain the key changes that occur in the
affect the company’s ability to serve its political and cultural environments
customers
• Discuss how companies can be proactive
• Explain how changes in demographic and rather than reactive when responding to
economic environments affect marketing and environmental trends
describe the levels of competition
©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

1
 2/23/2020

The Company’s The Company’s

Microenvironment Microenvironment
• The Company

• Suppliers

• Marketing Intermediaries

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

The Company Suppliers

• Marketing managers must work with all • Suppliers are firms and individuals that
departments of a company provide the resources needed by the
company to produce its goods and
• All Departments have an impact on the services
marketing department’s plans and
actions
• Suppliers can seriously affect marketing
plans
• “Think Consumer”
©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

2
 2/23/2020

The Company’s Macroenvironment

Marketing Intermediaries
• Marketing intermediaries help the company
promote, sell, and distribute its goods to the
final buyers

• Marketing service agencies help formulate

and implement marketing strategies

• Financial intermediaries help hospitality

companies finance their transactions
(Adapted from Analysis for Market Planning, Donald R. Lehmann and Russell S. Winer, p. 22, 1994 by Richard D. Irwin.)

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

Competitors Demographic Environment

• To be successful, a company must satisfy • Demography is the study of human
needs and wants of consumers better than populations in terms of size, density, location,
competitors age, gender, race, occupation, and other
• A company should monitor three variables statistics
when analyzing each of its competitors
– Share of Market • Demographics change over time and
– Share of Mind companies must keep up with them
– Share of Heart

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

3
 2/23/2020

Demographic Environment Economic Environment

• Baby boomers – 77 Million post-World War • The economic environment consists of
II babies born between 1946-1964 factors that affect consumer purchasing
power and spending patterns
• Generation X – 45 million born between
1965-1976, the “birth dearth” • It is not enough to have people, the
people must have buying power
• Generation Y (echo boomers) – 72 million
born between 1977-1994

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

The Global Economy Natural Environment

• The natural environment consists of
Global economic dealings, such as currency
natural resources required by marketers
exchange rates, have a large impact on
or affected by marketing activities
travel and tourism across the world

• Anyone involved in tourism is

responsible for protecting the
environment and ensuring sustainability

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

4
 2/23/2020

Technological Environment Political Environment

• The hospitality industry is greatly affected by
changes in technology The political environment is made up of
– The Internet, computerized systems, key cards, laws, government agencies, and
etc.
pressure groups that influence and limit
• Faces opposition by those who believe it the activities of various organizations
threatens privacy, simplicity, and even the and individuals in society
human race

• The most dramatic force affecting tourism

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

Political Trends Cultural Environment

• Increased legislation and regulation affecting • The cultural environment includes
business institutions and other forces that affect
society’s basic values, perceptions,
preferences, and behaviors
• Changing government Agency Enforcement

– Persistence of cultural values

• Increased emphasis on socially responsible
actions and ethics e.g. MADD and PETA
– Subcultures

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

5
 2/23/2020

Linked Environmental Responding to the

Factors Marketing Environment
• Environmental factors can also work together • Many companies feel the marketing
to bring about change environment is uncontrollable

– Americans now eat more meals prepared outside • An environmental management perspective
than inside the home takes action to sway the marketing
environment
– Low-carb diets

• Take a proactive rather than a reactive

– Grocery stores competing with restaurants
approach
©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

Environmental Scanning Using Marketing Information

1. Determine environmental areas that require
• Simple data collection is not sufficient
monitoring

2. Determine how the information will be • Information must be:

collected
– Reliable
3. Implement data collection plan
– Timely
4. Analyze data and use in market planning
process – Used in decision making

©2006 Pearson Education, Inc. Marketing for

Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

6
 2/23/2020

Best Practices Key Terms

• 59 million Americans (28% of the • Demography
population) restricting carbohydrate intake
• Echo boomers (baby boomlet
• Chipotle served burritos in bowls generation)

• Atkins friendly wraps by Subway • Economic environment

• Is Low-carb dieting a passing fad? • Environmental management

perspective
©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens

Key Terms Key Terms

• Marketing intermediaries
• Financial intermediaries
• Marketing services agencies
• Generation X
• Microenvironment
• Macroenvironment

• Marketing environment • Political environment

• Suppliers
©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition ©2006 Pearson Education, Inc. Marketing for
Marketing
Hospitality
forand
Hospitality
Tourism,and
4thTourism,
edition 4th edition
Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens Upper Saddle River, NJ 07458 Kotler,
Kotler, Bowen,
Bowen,and
andMakens
Makens