Principle of Marketing

Principles of Marketing
Nineteenth Edition
Chapter 1
Marketing: Creating Customer
Value and Engagement
Copyright © 2024, 2021, 2018 Pearson Education, Inc. All Rights Reserved
Learning Objectives
1.1 Define marketing and outline the steps in the marketing
process.
1.2 Explain the importance of understanding the
marketplace and customers and identify the five core
marketplace concepts.
1.3 Identify the key elements of a customer value-driven
marketing strategy and discuss the marketing
management orientations that guide marketing strategy.
1.4 Discuss customer relationship management and identify
strategies for creating value for customers and capturing
value from customers in return.
1.5 Describe the major trends and forces that are changing
the marketing landscape in this age of relationships.
First Stop: Amazon
Amazon does much more than just sell goods online. It
engages customers and creates satisfying customer
experiences. “The thing that drives everything is creating
genuine value for customers,” says Amazon founder Jeff
Bezos.
© 1996–2021, Amazon.com, Inc. or its affiliates
Learning Objective 1
Define marketing and outline the steps in the marketing
process.
What Is Marketing? (1 of 2)
The set of strategies and activities by which companies
acquire and engage customers, build strong customer
relationships, and create superior customer value in order to
capture value from customers in return.
What Is Marketing? (2 of 2)
Marketing is all around you, in good old traditional forms and
in a host of newer forms, from websites and mobile apps to
online videos and social media.
Cathy Yeulet/123 RF
Figure 1.1
The Marketing Process: Creating and Capturing Customer
Value
Explain the importance of understanding the marketplace
and customers and identify the five core marketplace
concepts.
Understanding the Marketplace and
Customer Needs (1 of 5)
Needs are states of felt deprivation.
Wants are the form human needs take as they are shaped by
culture and individual personality.
Demands are human wants that are backed by buying power.
Staying close to customers:

Starbucks CEO Kevin Johnson
regularly spends time in local
Starbucks stores, working the
counter, brewing coffee, handing
out orders, wiping tables, and
chatting with customers. He wants
to understand “what it means to A P Photo/Ted S. Warren
be human in a digital age.”
• Market offerings are some combination
of products, services, information, or
experiences offered to a market to satisfy
a need or want.
• Marketing myopia—paying more
attention to the specific products than to
the benefits and experiences produced
Marketing ideas and causes: The Ad

Council’s “Texting and Driving
Prevention” campaign addresses the
disconnect between awareness and
behavior by reminding drivers from 16
“Text and Whatever.” Pereira O’Dell for the
to 34 that no one is special enough to National Highway Traffic Safety
Administration and Ad Council’s Texting and
message while driving. Driving Prevention campaign.
Real Marketing 1.1: Mahali Mzuri: An
Immersive Experience at the World’s
Number-One Hotel
Marketing experiences: When it comes to delivering unforgettable
experiences, few travel and hospitality businesses can match
Kenya’s Mahali Mzuri safari camp, recently named by Travel +
Leisure magazine as the “#1 hotel in the world.”
Adam Slama
• Customers form expectations about the value and
satisfaction of market offerings.
– Satisfied customers buy again
– Dissatisfied customers switch to competitors
• Exchange is the act of obtaining a desired object from
someone by offering something in return.
• Marketing actions try to create, maintain, and grow
desirable exchange relationships.
A market is the set of actual and potential buyers.
Consumers market when they:
• search for products
• interact with companies to obtain information
• make purchases
Figure 1.2 A Modern Marketing System
Identify the key elements of a customer value-driven
marketing strategy and discuss the marketing management
orientations that guide marketing strategy.
Designing a Customer Value-Driven
Marketing Strategy and Plan (1 of 6)
Marketing management is the art and science of choosing
target markets and building profitable relationships with
them.
• What customers will we serve (target market)?
• How can we best serve these customers (value
proposition)?
Value propositions:
A brand’s value proposition is the set of benefits or values
it promises to deliver to customers to satisfy their needs.
Value propositions: JetBlue

promises “award-winning
service from award-
winningly nice humans.”
“Just Alright Doesn’t Fly
Here.”
Courtesy of JetBlue
Figure 1.3 Selling and Marketing Concepts Contrasted
• Production concept
• Product concept
• Selling concept
• Marketing concept
• Societal Marketing concept
The societal marketing concept:
Jeni’s Splendid Ice Creams, LLC
Jeni’s Splendid Ice Creams
does more than just make good
ice cream. It makes “ice creams
created in fellowship with
growers, makers, and
producers from around the
world all for the love of you.”
Societal marketing:
The company’s marketing decisions should consider consumers’
wants, the company’s requirements, consumers’ long-run
interests, and society’s long-run interests.
Figure 1.4 Three Considerations Underlying the Societal
Marketing Concept
The marketing mix is comprised of a set of tools known a
the four Ps:
• Product
• Price
• Promotion
• Place
Integrated marketing program—a comprehensive plan that

communicates and delivers intended value
Discuss customer relationship management and identify
strategies for creating value for customers and capturing
value from customers in return.
Managing Customer Relationships
and Capturing Customer Value (1 of 9)
Customer relationship management—the overall process
of building and maintaining profitable customer relationships
by delivering superior customer value and satisfaction.
Relationship Building Blocks
• Customer-perceived value
– The difference between total
customer perceived benefits and
customer cost
• Customer satisfaction
– The extent to which perceived
performance matches a buyer’s
expectations
Perceived value: Some owners
consider a Patek Philippe watch a real
bargain, even at prices ranging from
$20,000 to $1,000,000 or more. “You
never actually own a Patek Philippe.
You merely look after it for the next
generation.” Courtesy of Patek Philippe Geneva
Customer-Engagement Marketing
Fosters direct and continuous
customer involvement in shaping
brand conversations, experiences,
and community.
Engaging customers: Rather than

using intrusive, hard-sell product
pitches, Bark interacts with
customers in humorous ways about
Benjamin Ginsberg/Alamy Stock Photo;
their favorite mutual topic—“the Jonathan Weiss/Alamy Stock Photo
weird dogs we live with and the
funny things they do.”
Consumer-Generated Marketing
Brand exchanges created by
consumers themselves.
Consumers are playing an
increasing role in shaping brand
experiences.
Customer-generated content: Heinz

invited people across five continents
The Kraft Heinz Company
to “draw ketchup.” Most drew Heinz.
Many of the sketchers and their
sketches—both sophisticated and
amateurish— were featured in an
online video and on digital
billboards.
Partner relationship management involves working closely with
partners in other company departments and outside the company to
jointly bring greater value to customers.
Relationship marketing tools: The

American Airlines AAdvantage
program promotes customer loyalty
through numerous membership
benefits. At the same time, it allows
American to profit from multiple
revenue streams.
Ian Dagnall/Alamy Stock Photo
Customer lifetime value is the value of the entire stream of purchases
that the customer would make over a lifetime of patronage.
Customer lifetime value: To keep customers coming back, Stew
Leonard’s has created the “Disneyland of dairy stores.” Rule #1—The
customer is always right. Rule #2—If the customer is ever wrong, reread
Rule #1.
Courtesy of Stew Leonard’s

Share of customer is the portion of the customer’s purchasing that a
company gets in its product categories.
Customer equity is the total combined customer lifetime values of all of
the company’s customers.
Managing customer equity: To increase customer equity, Cadillac is
making the classic car cool again among younger buyers. For example,
says GM, “Cadillac will lead the company to an all-electric future.”
Mark Andrews/Alamy Stock Photo

Figure 1.5 Customer Relationship Groups
Describe the major trends and forces that are changing the
marketing landscape in this age of relationships.
The Changing Marketing Landscape
(1 of 5)
• Digital Age
• Changing Economic Environment
• Growth of Not-for-Profit Marketing
• Rapid Globalization
• Sustainable Marketing
(2 of 5)
We live in the age of Internet of Things, where everything is
connected to everything else.
Digital and social media marketing involves using digital
marketing tools such as websites, social media, mobile ads
and apps, online videos, email, and blogs that engage
consumers anywhere, at any time, via their digital devices.
(3 of 5)
• Social media provide exciting opportunities to extend
customer engagement and get people talking about a
brand.
• Mobile marketing: Using mobile channels to stimulate
immediate buying, make shopping easier, and enrich the
brand experience.
• Big Data and AI: Brands can use big data to gain deep
customer insights, personalize marketing offers, and
improve customer engagements and service.
Digital and Social Media Marketing
Online brand communities: Sephora’s Beauty Insider Community
is a thriving online community where customers can ask
questions, share ideas and reviews, post photos, and get beauty
advice and inspiration from other enthusiasts.
Manuel Esteban/Shutterstock; Eyal Dayan Photography
Real Marketing 1.2: Real-Time
Marketing: Engaging Consumers in
the Moment
Real-time marketing: Snack
brand MoonPie is known for its
skillful use of real-time social
media marketing to create a
fresh, relevant brand personality
and spark ongoing real-time
engagement with the brand’s
fans.
Courtesy of MoonPie
(4 of 5)
Not-for-profit marketing is growing, as sound marketing can help
organizations attract membership, funds, and support.
Not-for-profit marketing:
Make-A-Wish® skillfully
markets its mission to
“create life-changing wishes
for children with critical
illnesses.” Since its
founding, Make-A-Wish has
fulfilled more than 520,000
wishes to children at dark
times in their lives, bringing
them welcome rays of light
Make-A-Wish America
and hope that can play an
important part in their
healing.
(5 of 5)
• Rapid Globalization: Managers around the world are taking both
local and global views of the company’s
– Industry
– Competitors
– Opportunities
• Sustainable Marketing: Corporate ethics and social responsibility
have become important for every business.
Sustainable Marketing: The Call for More
Environmental and Social Responsibility
Today’s consumers expect marketers to be socially and environmentally
responsible.
Sustainable marketing: Ben

& Jerry’s three-part “linked
prosperity” mission drives it
to make fantastic ice cream
(product mission), manage
the company for sustainable
financial growth (economic
mission), and use the
company in “innovative
ways to make the world a
better place” (social
mission). Both Ben & Jerry’s
and its products are “Made Ben & Jerry’s Homemade Inc.
of Something Better.”
So, What Is Marketing? Pulling It All
Together
Figure 1.6 An Expanded Model of the Marketing Process
Discussion Question (1 of 2)
What are the major changes taking place in the marketing
arena?
What skills will you develop by studying marketing?
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materials.
Nineteenth Edition
Chapter 2
Company and Marketing
Strategy: Partnering to Build
Customer Engagement, Value,
and Relationships
Learning Objectives
2.1 Explain company-wide strategic planning and its four
steps.
2.2 Discuss how to design business portfolios and develop
growth strategies.
2.3 Explain marketing’s role in strategic planning and how
marketing works with its partners to create and deliver
customer value.
2.4 Describe the elements of a customer value-driven
marketing strategy and mix and the forces that influence
them.
2.5 Explore the marketing management functions, including
the elements of a marketing plan, and discuss the
importance of measuring and managing marketing
return on investment.
STARBUCKS: Delivering the
“Starbucks Experience”
More than just coffee, Starbucks sells the “Starbucks Experience,”
one that “enriches people’s lives one moment, one human being,
one extraordinary cup of coffee at a time.”
Andrew Aitchison/Alamy Stock Photo
Explain company-wide strategic planning and its four steps.
Company-Wide Strategic Planning:
Defining Marketing’s Role (1 of 5)
Strategic planning is the process of developing and
maintaining a strategic fit between the organization’s goals
and capabilities, and its changing marketing opportunities.
Figure 2.1 Steps in Strategic Planning
The mission statement is the organization’s purpose; what
it wants to accomplish in the larger environment.
CVS Health’s overall mission
is to be a “health care
innovation company,” one that
is “helping people on their
way to better health.” Its
marketing strategies and
programs must support this rafapress/Shutterstock
mission.
Product- versus Market-Oriented Business Definitions
Company Product-Oriented Definition Market-Oriented Definition
Starbucks We sell coffee and snacks. We sell “The Starbucks Experience,” one
that enriches people’s lives in one
moment, one human being, one
extraordinary cup of coffee at a time.
Panera We sell fast-casual food in our We give customers “Food as it should
restaurants. be”: food that tastes good; food that feels
good; food that does good things for them
and the world around them.
Real Marketing 2.1 IKEA’s Mission:
Creating a Better Everyday Life for
the Many People
IKEA’s deeply held mission is
to “create a better everyday
life for the many people K
by offering a wide range of
well-designed, functional
home furnishing products at
prices so low that as many
people as possible will be
able to afford them.”
Used with the permission of Inter I KE A Systems B.V.
Setting Company Objectives and Goals
• Business objectives
– Build profitable customer relationships
– Invest in research
– Improve profits
• Marketing objectives
– Increase market share
– Create local partnerships
– Increase promotion
Discuss how to design business portfolios and develop
growth strategies.
Designing the Business Portfolio
(1 of 8)
The business portfolio is the collection of businesses and products that
make up the company.
Portfolio analysis is a major activity in strategic planning whereby
management evaluates the products and businesses that make up the
company.
Complex business portfolios: You

probably know Johnson & Johnson
for its many iconic consumer health
brands, maybe BAND-AID brand
adhesive bandages, Johnson’s baby
shampoo, or Tylenol pain reliever.
But did you know that the
substantial bulk of J&J’s revenue
comes from its pharmaceuticals and
Justin Sullivan/Getty Images
medical devices businesses?
(2 of 8)
Strategic business units can be a
• Company division
• Product line within a division
• Single product or brand
(3 of 8)
Analyzing the Current Business Portfolio
• Identify strategic business units (SBUs)
• Assess the attractiveness of its various SBUs
• Decide how much support each SBU deserves
(4 of 8)
Figure 2.2 The BCG Growth-Share Matrix
(5 of 8)
Problems with Matrix Approaches
• Difficulty in defining SBUs and measuring market share
and growth
• Time consuming
• Expensive
• May not apply well to markets facing structural changes or
disruptions
• Many companies dropped formal matrix-based methods in
favor of customized approaches that suit specific
situations.
• These approaches are more decentralized.
(6 of 8)
Figure 2.3 The Product/Market Expansion Grid
(7 of 8)
Developing Strategies for Growth and Downsizing
Strategies for growth: To maintain its incredible growth, Starbucks
has brewed up an ambitious, multipronged growth strategy. In
little more than three decades, the chain has grown from a small
Seattle coffee shop to an over $24 billion powerhouse.
ChameleonsEye/Shutterstock
(8 of 8)
Developing Strategies for Growth and Downsizing

Downsizing is when a company must prune, harvest, or
divest businesses that are unprofitable or that no longer fit
the strategy.
Explain marketing’s role in strategic planning and how
marketing works with its partners to create and deliver
customer value.
Planning Marketing: Partnering to
Build Customer Relationships (1 of 3)
Partnering with Other Company Departments
Value chain is a series of departments that carry out value
creating activities to design, produce, market, deliver, and
support a firm’s products.
Partnering with Other Company Departments
The value chain: To obtain sales
and maintain a profitable
customer relationship, Airbus
marketers work closely with
finance, design, production,
service, and other Airbus
departments to engage in a
highly coordinated customer vaalaa/Shutterstock
value creation and delivery
process over time. Working
together, the total company team
can help Airbus’s airline
customers “own the sky.”
Partnering with Others in the Marketing System
Value delivery network is made up of the company,
suppliers, distributors, and ultimately customers who partner
with each other to improve performance of the entire system.
Describe the elements of a customer value-driven marketing
strategy and mix and the forces that influence them.
Marketing Strategy and the Marketing
Mix (1 of 7)
Figure 2.4 Managing Marketing Strategies and the
Marketing Mix
Mix (2 of 7)
Customer Value-Driven Marketing Strategy
Marketing strategy is the marketing logic by which the
company hopes to create customer value and achieve
profitable customer relationships.
Mix (3 of 7)
Market segmentation is the division of a market into distinct
groups of buyers who have different needs, characteristics,
or behaviors and who might require separate products or
marketing mixes.
Market segment is a group of consumers who respond in a
similar way to a given set of marketing efforts.
Discuss the importance of market segmentation
Mix (4 of 7)
Market targeting is the process of evaluating each market
segment’s attractiveness and selecting one or more
segments to enter.
Market positioning is the arranging for a product to occupy
a clear, distinctive, and desirable place relative to competing
products in the minds of target consumers.
Differentiation begins the positioning process.
Mix (5 of 7)
Positioning is arranging for a product to occupy a clear, distinctive, and
desirable place relative to competing products from competing brands
and give them the greatest advantage in their target markets.
Nicher Harry’s focuses on direct-to-

consumer sales of high-quality
razors and shaving products to a
value- and convenience-oriented
segment of buyers previously not
well served by giant competitors like
Gillette.
rchat/Shutterstock
Positioning
Positioning: Liberty Mutual’s
“only pay for what you need”
positioning—delivered by
quirky spokes-animal LiMu
Emu and his human friend
Doug—strongly differentiates
the brand as one that saves
people from overpaying for
one-size-fits-all insurance.
Courtesy of Liberty Mutual
Mix (6 of 7)
Developing an Integrated Marketing Mix
Marketing mix is the set of controllable, tactical marketing
tools—product, price, place, and promotion—that the firm
blends to produce the response it wants in the target market.
Mix (7 of 7)
Figure 2.5 The Four Ps of the Marketing Mix
Marketers should think through the Four As and then build
the four Ps. Do you agree? Explain your answer.
Explore the marketing management functions, including the
elements of a marketing plan, and discuss the importance of
measuring and managing marketing return on investment.
Managing the Marketing Effort and
Marketing Return on Investment
(1 of 4)
Figure 2.6 Managing Marketing: Analysis, Planning,

Implementation, and Control
(2 of 4)
Figure 2.7 SWOT Analysis: Strengths (S), Weaknesses (W),
Opportunities (O), and Threats (T)
(3 of 4)
Market Planning—Parts of a Marketing Plan
• Executive summary
• Current Marketing situation
• Threats and opportunities analysis (SWOT)
• Objectives and issues
• Marketing strategy
• Executive plans
• Budgets
• Controls
(4 of 4)
Marketing Implementation
• Turning marketing strategies and plans into marketing
actions to accomplish strategic marketing objectives
• Addresses who, where, when, and how
Marketers must continually
plan their analysis,
implementation, and control
activities.
ammentorp/123 RF
Marketing Department Organization
• To head up large marketing organizations, many
companies have created a chief marketing officer (or
CMO) position.
• Modern marketing departments can be arranged in
several ways.
– Functional organization
– Geographic organization
– Product management organization
– Market or customer organization
Marketing Control
• Marketing control involves four steps.
– Management
▪ sets specific marketing goals.
▪ measures its performance in the marketplace
▪ evaluates the causes of any differences between
expected and actual performance
▪ takes corrective action to close the gaps between
goals and performance.
• Operating control
• Strategic control
Measuring and Managing Return on
Marketing Investment (1 of 2)
Return on Marketing Investment (Marketing ROI)
• Net return from a marketing investment divided by the
costs of the marketing investment
• Measurement of the profits generated by investments in
marketing activities
Measuring and Managing Return on
Marketing Investment (2 of 2)
Figure 2.8 Marketing Return on Investment
Copyright

materials.
Nineteenth Edition
Chapter 3
Analyzing the Marketing
Environment
Learning Objectives
3.1 Describe the environmental forces that affect the
company’s ability to serve its customers.
3.2 Explain how changes in the demographic and economic
environments affect marketing decisions.
3.3 Identify the major trends in the firm’s natural and
technological environments.
3.4 Explain the key changes in the political and cultural
environments.
3.5 Discuss how companies can react to the marketing
environment.
BEST BUY: Thriving in a Fast-
Changing Marketing Environment
To better align itself with the
changing marketing
environment, Best Buy
launched a broad-based
omni-retailing strategy that
integrates in-store and online
channels to create the omni-
channel shopping experience Eyal Dayan Photography
today’s customers seek.
A Company’s Marketing Environment
The marketing environment includes the actors and forces
outside marketing that affect marketing management’s ability
to build and maintain successful relationships with target
customers.
Describe the environmental forces that affect the company’s
ability to serve its customers.
The Microenvironment and
Macroenvironment (1 of 2)
Microenvironment consists of the actors close to the
company that affect its ability to serve its customers—the
company, suppliers, marketing intermediaries, customer
markets, competitors, and publics.
The Microenvironment and
Macroenvironment (2 of 2)
Macroenvironment consists of the larger societal forces
that affect the microenvironment—demographic, economic,
natural, technological, political, and cultural forces.
The Microenvironment (1 of 8)
Figure 3.1 Actors in the Microenvironment
The Company
In designing marketing plans, marketing management takes
other company groups into account.
• Top management
• Finance
• Research and development (R&D)
• Information technology
• Purchasing
• Operations
• Human resources
• Accounting
Suppliers
• Provide the resources to
produce goods and services
• Treat as partners to provide
customer value
L’Oréal builds long-term supplier

relationships based on mutual
benefit and growth. It “wants to
make L’Oréal a top performer
and one of the world’s most aslysun/Shutterstock; G K Images/Alamy Stock Photo
respected companies. Being

respected also means being
respected by our suppliers.”
Marketing Intermediaries
Marketing intermediaries are
firms that help the company to
promote, finance, sell, and
distribute its goods to final
buyers.
Partnering with intermediaries:
Coca-Cola provides its retail
partners with much more than
just soft drinks. It also pledges
powerful marketing support.
The Coca-Cola Company
Marketing Intermediaries
• Resellers
• Physical distribution firms
• Marketing services agencies
• Financial intermediaries
Competitors
Firms must gain strategic advantage by positioning their offerings
strongly against competitors’ offerings in the minds of consumers.
Publics Publics: The Home Depot Foundation
Any group that has an actual or gives back to local communities
potential interest in or impact on through support for local nonprofits,
an organization’s ability to grants, and countless orange-shirted
achieve its objectives “Team Depot” employee volunteer
hours. It is committed to a culture of
• Financial publics
service that doesn’t stop at the
• Media publics checkout counter.
• Government publics
• Citizen-action publics
• Local publics
• General public
• Internal publics
Jim West/Alamy Stock Photo
Customers
• Consumer markets
• Business markets
• Reseller markets
• Government markets
• International markets
The Macroenvironment
Figure 3.2 Major Forces in the Company’s
Macroenvironment
Real Marketing 3.1: Marketing in the
Age of Disruption: Managing the
Present and Planning for the Future
Perhaps no company
provides a better example of
how to adapt to major
disruptions in the marketing
environment than beverage
maker KDP. During the
COVID-19 pandemic, KDP
“forged a blueprint that Eyal Dayan Photography
makes disruption our friend.”
Explain how changes in the demographic and economic
environments affect marketing decisions.
The Demographic and Economic
Environments (1 of 8)
The Demographic Environment
• Demography is the study of human populations—size,
density, location, age, gender, race, occupation, and other
characteristics.
• Demographic environment involves people, and people
make up markets.
• Demographic trends include changing age and family
structures, geographic population shifts, educational
characteristics, and population diversity.
• Baby Boomers – born between 1946 and 1964
• Generation X – born between 1965 and 1980
• Millennials – born between 1981 and 1996
• Generation Z – born between 1997 and 2012
• Generation Alpha – born after 2012
Generational marketing: Baby
boomers and millennials are now
moving over to make room for
younger Generation Alpha.
Shutterstock
Generational marketing is important in segmenting people by lifestyle
or life stage instead of age.
Marketing to Boomers: The Nike

CruzrOne sneaker naturally
appeals to older baby boomers
but focuses on lifestyle and pace
rather than age.
All trademarks, service marks and trade names (e.g., the

NIKE name and the Swoosh design) are owned, registered
and/or licensed by NIKE. Other image provided by Erickson
Stock/Alamy Stock Photo
Targeting Gen Xers: Meal-plan delivery services like HelloFresh and
Home Chef are especially attractive to time-pressed Gen Xers as they
juggle careers and family, seek stress-free and convenient meal planning
and preparation, and look for healthier family eating options.
©2013 – 2021, Relish Labs L LC. Home Chef; HelloFresh S E
• The changing American family
• Geographic shifts in population
• A better-educated, more white-collar, more professional population
• Increasing diversity
• Working remotely
Marketing to Generation Z: The
Domino’s ANYWARE ordering
platform, which accepts orders
from 11 different devices and
channels, appeals to Gen Zers’
digital fluency and need for
customized interactions and
convenient ordering experiences.
Courtesy of Domino’s
Working remotely: The Zoom Whiteboard lets users in
remote locations replicate the experience of a collaborative
team physically gathered around a large whiteboard in an
office.
Zoom Video Communications, Inc
Marketing to consumers with

disabilities: Toyota’s
marketing highlights
inspirational real-life stories of
athletes who overcame
mobility challenges, such as
Paralympic gold medalist
swimmer Jessica Long,
Lintao Zhang/Getty Images
whose lower legs were
amputated when she was 18
months old.
The Economic Environment
Economic environment: Consumers adopted a new back-to-basics
sensibility in their lifestyles and spending patterns. To serve the tastes of
these more financially frugal buyers, companies like Target are
emphasizing the “pay less” side of their value propositions.
A P Photo/M. Spencer Green
How do marketers increase diversity?
Identify the major trends in the firm’s natural and
technological environments.
The Natural and Technological
The Natural Environment
The natural environment is the physical environment and the natural
resources that are needed as inputs by marketers or that are affected by
marketing activities.
Trends in the Natural Environment
• Growing shortages of raw materials
• Increased pollution
• Increased government intervention
• Developing strategies that support environmental
sustainability
Environmental sustainability involves developing strategies and
practices that create a world economy that the planet can support
indefinitely.
The natural environment: At The

North Face, sustainability is about
more than just doing the right
thing—it also makes good business
sense. Sustainability efforts such as
its “Clothes the Loop” program are
good for the company, its
customers, and the planet.
G RO G L/Shutterstock
The Technological Environment
• Most dramatic force in changing the marketplace
• New products, opportunities
• Concern for the safety of new products
Marketing technology: Two decades
ago, even wide-eyed futurists would
have had difficulty envisioning
today’s digital world. Digital has
become an inseparable part of
everything we do as consumers.
metamorworks/Shutterstock
Explain the key changes in the political and cultural
environments.
The Political–Social and Cultural
The Political and Social Environment
Legislation regulating business is intended to protect
• companies from each other
• consumers from unfair business practices
• the interests of society against unrestrained business
behavior
The Political and Social Environment
• Increased emphasis on ethics and socially responsible actions
• Cause-related marketing
Cause-related marketing: Warby

Parker sells eyewear with a
purpose. “Companies can do good
in the world while still being
profitable,” says the company’s co-
founder.
Astrid Stawiarz/WireImage/Getty Images; Kristoffer

Tripplaar/Alamy Stock Photo
The Cultural Environment
The cultural environment consists of institutions and other
forces that affect a society’s basic values, perceptions, and
behaviors.
Real Marketing 3.2: Cause-Related
Marketing: Linking Brands,
Consumers, and Causes
Aerie’s #AerieREAL
campaign pledges that it will
use only unretouched images
and videos of real women in
its ads and other marketing
content. The cause of body
positivity and inclusivity is an
integral part of the brand’s
identity.
MediaPunch Inc/Alamy Stock Photo
Core beliefs and values are persistent and are passed on
from parents to children and are reinforced by schools,
churches, businesses, and government.
Secondary beliefs and values are more open to change and
include people’s views of themselves, others, organizations,
society, nature, and the universe.
The Cultural Environment People’s views of others: These
Shifts in Secondary Cultural days, even when people are
Values together, they are often “alone
• People’s views of together.”
themselves
• People’s views of others
• People’s views of
organizations
• People’s views of society
• People’s views of nature
• People’s views of the
universe
rawpixel/123RF
Catering to the natural, organic,
and ethical products trend:
Unilever’s Love Beauty and
Planet brand has one goal: “To
make you more beautiful and
give a little love to our planet.”
Retro AdArchives/Alamy Stock Photo
Discuss how companies can react to the marketing
environment.
Responding to the Marketing
Environment
Views on Responding
• Uncontrollable
– React and adapt to forces in the environment
• Proactive
– Take aggressive actions to affect forces in the
environment
• Reactive
– Watch and react to forces in the environment
What are some examples of how companies can react to the
marketing environment?
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Principles of Marketing

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Staying close to customers:

Marketing ideas and causes: The Ad

Value propositions: JetBlue

Integrated marketing program—a comprehensive plan that

Engaging customers: Rather than

Customer-generated content: Heinz

Relationship marketing tools: The

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Sustainable marketing: Ben

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Complex business portfolios: You

Developing Strategies for Growth and Downsizing

Nicher Harry’s focuses on direct-to-

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Figure 2.6 Managing Marketing: Analysis, Planning,

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today’s customers seek.

L’Oréal builds long-term supplier

respected companies. Being

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makes disruption our friend.”

Marketing to Boomers: The Nike

All trademarks, service marks and trade names (e.g., the

©2013 – 2021, Relish Labs L LC. Home Chef; HelloFresh S E

Zoom Video Communications, Inc

Marketing to consumers with

A P Photo/M. Spencer Green

The natural environment: At The

Cause-related marketing: Warby

Astrid Stawiarz/WireImage/Getty Images; Kristoffer

MediaPunch Inc/Alamy Stock Photo

Retro AdArchives/Alamy Stock Photo

This work is protected by United States copyright laws and is

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