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CHAPTER 3
Scanning the Marketing Environment

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 ENVIRONMENTAL SCANNING

Environmental scanning : the process of continually acquiring information on events

occurring outside the organization to identify and interpret potential trends
What trends might affect marketing in the future?
Ex: Coffee industry
• Increase in gourmet coffee
• New flavors and seasonal blends
• Online ordering
• Cold brew coffee
• Roastery tasting rooms
• Coffee bars

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 FIGURE 3-1 Environmental forces affect the organization, its
suppliers, and its customers

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 SOCIAL FORCES
DEMOGRAPHICS — WORLD POPULATION
Social forces are the demographic characteristics of the population and its culture
Demographics describe a population according to selected characteristics such
as age, gender, ethnicity, income, and occupation
World population–7.8 billion, growing to 9.9 billion by 2050!
• India will have largest population in 2050–1.66 billion people
• China will have 1.36 billion people
• Declining populations in 38 countries, including Spain, Japan, Russia, and
Germany

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 SOCIAL FORCES
CULTURE—CHANGING VALUES
Culture:
• Culture consists of the set of values,
ideas, and attitudes that are learned and
shared among the members of a group
Notable cultural changes:
• Attitudes and roles
• Gender stereotypes
• Fashion
Value consciousness is the concern for obtaining
• Careers the best quality, features, and performance of a
product or service for a given price that drives
• Sports consumption behavior
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 SOCIAL FORCES
CULTURE
Changing values, over time and between countries:
• Equality
• Sustainability
• Environment
• Consumer values
• Social action
• Financial transactions

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 FIGURE 3-1 Environmental forces affect the organization, its
suppliers, and its customers

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 ECONOMIC FORCES: MACROECONOMIC
CONDITIONS
Economy: The economy pertains to the
income, expenditures, and resources that
affect the cost of running a business and
household
Marketers use environmental
information to better understand
consumers
Macroeconomics: Performance of the
economy
• Inflation: Production costs and prices increase
• Recession: Periods of declining economic
activity
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 FIGURE 3-1 Environmental forces affect the organization, its
suppliers, and its customers

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 TECHNOLOGICAL FORCES
TECHNOLOGY OF TOMORROW
Technology consists of the inventions or innovations from applied science or
engineering research
• Facial and fingerprint recognition
• Blockchain digital ledger
• Smart speakers
• Digital assistants
• Artificial Intelligence
• Wearable Technology

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 What products/services might be replaced by these
innovations?

3D Printers Cryptocurrenc Hyperloop

y

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 TECHNOLOGICAL FORCES
TECHNOLOGY’S IMPACT ON CUSTOMER VALUE
Impact on customer value:
• Plummeting costs of technology
• New focus on quality, service, relationships
• Thousands of new products
• Changes production of existing products
• Recycling
• Avocado Tester

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 TECHNOLOGICAL FORCES
TECHNOLOGY ENABLES DATA ANALYTICS
Marketspace is an information- and
communication-based electronic exchange
environment mostly occupied by sophisticated
computer and telecommunication technologies and
digitized offerings

Electronic commerce is any activity that uses

some form of electronic communication in the
inventory, exchange, advertisement, distribution,
and payment of products and services

Internet of Things (IoT) is the network of products

embedded with connectivity-enabled electronics
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 FIGURE 3-1 Environmental forces affect the organization, its
suppliers, and its customers

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 COMPETITIVE FORCES
ALTERNATIVE FORMS OF COMPETITION
Competition
• Pure competition: Many sellers
with similar products
• Monopolistic competition:
Many sellers with substitutable
products in a price range
• Oligopoly: Few sellers control
majority of sales
• Pure monopoly: Only one Seller

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