MKTG 14e – Chapter 4: The Marketing Environment

38 question-and-answer flashcards summarizing key terms, concepts, and examples from Chapter 4 of MKTG 14e, covering the external marketing environment, social and demographic influences, DEI, economic conditions, technology, political/legal frameworks, competition, and environmentalism.

What are the four components of the marketing mix?

Product, place (distribution), promotion, and price.

Define a target market.

A group of people or organizations for which a firm designs and maintains a marketing mix to meet their needs and achieve mutually satisfying exchanges.

What is the goal of environmental scanning?

To continually collect and evaluate external information in order to identify market opportunities and threats.

Give two examples of information firms analyze during environmental scanning.

Population shifts and competitors’ activities (others include customer desires, industry trends, etc.).

According to the 80/20 rule, what percent of customers often produce 80 percent of revenue?

Roughly 20 percent of customers.

Why must firms understand their competitors?

Competitors threaten market share, profitability, and even a firm’s existence by offering alternatives to customers.

Social factors in marketing include , , and .

Attitudes, values, and lifestyles.

How do values influence consumer behavior?

They affect the products people buy, prices they’ll pay, the promotions they notice, and how/where/when they purchase.

Define demography.

The study of people’s vital statistics such as age, race, gender, and location.

List the birth-year range for Generation Alpha.

2010 to 2024.

Name two ways social media have changed consumer behavior.

Altered how we communicate and how we browse/purchase products (others: keeping track of others, reliance on reviews, etc.).

What is pop culture in a marketing context?

Products and expressions widely accepted at a point in time that can help brands connect emotionally with customers.

Define diversity, equity, and inclusion (DEI).

Diversity: variety of backgrounds; Equity: fairness in processes/resources; Inclusion: actively including diverse people.

Why do inclusive marketing organizations outperform others?

Consumers are more likely to buy when they see themselves represented, leading to broader market access and loyalty.

Name the three economic concerns most important to marketers.

Consumers’ incomes, inflation, and recession.

How is purchasing power calculated in simple terms?

Income minus the cost of living (expenses).

What is inflation?

A measure of the decrease in money’s value, expressed as the annual percentage rise in average prices.

Define recession using GDP.

A period when GDP falls for two consecutive quarters, indicating negative economic growth.

According to McKinsey, what is Stage 3 in responding to disruptive tech?

The Inevitable Transformation – the future is pounding at the door and change is unavoidable.

Differentiate basic research from applied research.

Basic research aims to confirm theories or expand knowledge; applied research seeks to develop new or improved products.

Give one way big data analytics benefits marketers.

It provides insights into how consumers think, feel, and behave, improving targeting and marketing-mix decisions.

How did COVID-19 impact technology investment outcomes?

Firms that increased tech investments (websites, apps, contactless payments) outperformed competitors.

Which federal act created the Federal Trade Commission?

The Federal Trade Commission Act of 1914.

What does the Sherman Antitrust Act prohibit?

Trusts, conspiracies restraining trade, and attempts to monopolize.

Name the U.S. agency that enforces regulations on adulterated or misbranded food and drugs.

The Food and Drug Administration (FDA).

What is the primary mission of the Consumer Product Safety Commission (CPSC)?

To protect the health and safety of consumers in and around their homes.

What does the CAN-SPAM Act regulate?

It restricts unsolicited commercial email and prohibits false or misleading sender information.

What is GDPR and where does it apply?

The General Data Protection Regulation, a comprehensive EU law governing personal-data collection and use.

List three elements that define the competitive environment.

Number of competitors, relative size of competitors, and degree of interdependence within the industry.

Why is strong customer loyalty a defense against competitors?

Loyal customers are less likely to switch, helping firms maintain market share despite competitive moves.

Define environmentalism.

Concern about and action aimed at protecting and improving the natural environment.

What percentage of consumers say sustainable companies are important?

78 percent.

Give one company mentioned that acts on sustainability demands.

Patagonia (others: Allbirds, Tanger Factory Outlet Centers).

Explain purchasing power’s impact on discretionary income.

Higher purchasing power (income > cost of living) leaves consumers with more money to spend on non-essentials.

Which act prohibits bribery of foreign officials?

The Foreign Corrupt Practices Act of 1977.

What federal agency oversees unfair methods of competition and has bureaus for competition, consumer protection, and economics?

The Federal Trade Commission (FTC).

How has VR been applied in marketing?

To create immersive shopping experiences that allow consumers to virtually examine products.

Give an example of technology creating new competitors for traditional firms.

Uber and Lyft challenging traditional taxi companies.