Chapter 3 The Marketing Environment, Ethics and Social Responsibility Flashcards by Mariam Shenouda

Define External Audit (environmental scanning)

Focuses on identifying and evaluating trends and events beyond the control of a single firm
Revels key opportunities and threats confronting an orgnizations

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Define Environmental Scanning

Collecting external marketing environment information to identify and interpret potential trends

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Define Environmental Management

Attainment of organizational objectives by predicting and influencing the competitive, political/legal, economic, technological and social/cultural environments

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Define Strategic Alliance

Partnerships in which 2 or more partners combine resources and capital to create a competitive advantage in a new market

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Define PESTLE Analysis (PEST Analysis)

Used to track/scan the market environment

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Components of the PESTLE Analysis

P for political
E for economic
S for social
T for technological
L for legal
E for environmental

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Define Monopoly and provide an example

Market structure in which a single seller dominates trade in a good or service which buyers can find no close substitutes
Example: Some pharmaceutical firms have temporary monopolies because of patents on drugs (Advil)

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Define Oligopoly and provide an example

Few number of sellers in an industry with high start-up costs that keep out new competitors
Example: Auto manufacturers - Ford, GMC, Chrysler

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Types of Competition

Direct
- Among marketers of similar products
- Example: Bell, Rogers, Fido, Telus
Indirect
- Involves new products that are easily substituted
- Example: Pizza, tacos, burgers, wings

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Define Competitive Strategy

Methods through which a firm deals with its competitive environment

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Define Time Based Competition

Strategy of developing and distributing goods more quickly than competitors

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Define the Political/Legal Environment

Consists of laws and their interpretations that require firms to operate under competitive conditions and to protect consumer rights

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Define Competition Act

Comprehensive legislation administered by Industry Canada and designed to help both consumers and businesses by promoting a healthy competitive environment

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Define Price Fixing (pricing issue)

Sellers collude to set prices higher than they would be in a free market

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Define Bid Rigging (pricing issue)

Sellers collude to set prices with respect to one or more bids or quotations

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Define Price Discriminations (pricing issue)

A sellers charges different prices for the same quantity and quality to 2 customers who are in competitions with each other

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Define Predatory Pricing (pricing issue)

Seller set prices so low they deter competition from entering a market or with the intention to drive marketing

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Define Double Ticketing (pricing issue)

An item has been ticketed with 2 prices (the lowest price must prevail although there are limits now to protect sellers)

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Define Resale Price Maintenances (pricing issue)

Manufacturers or other channel members try to influence the price at which products are sold to subsequent buyers

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Define Misleading Advertising (promotion issue)

Representations, in print or made orally, concerning a product are false or misleading

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Define Referral Selling (promotion issue)

Price reductions or other inducements are offered to a customer for the names of other potential customers

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Define Bait and Switch Selling (promotion issue)

Sellers attract customers with low prices but then offer another product at a higher price because they are unable to provide the originally promoted item

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Define Tied Selling (promotion issue)

A seller requires a buyer to purchase another product or to refrain from purchasing a product from a specific manufacturer as a condition to getting the product they want

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Define Refusal to Deal (distribution issue)

Sellers refuse to sell to legitimate buyers

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Define Exclusive Dealing (distribution issue)

A seller refuses to sell to another channel member unless that customer agrees to buy only from that seller

Define Primary Selling (distribution issue)

Salespeople are paid to recruit additional salespeople, and each new sales person pays to "invest" in the scheme, with some of that investment going to earlier participants in the scheme

Importance of provincial laws

Focused on protection of buyers and sellers with respect to direct sales contracts

Government Regulatory Agencies

- Canadian Radio Television and Telecommunications Commission (CRTC) - National Energy Board

Define Canadian Radio Television and Telecommunications Commission (CRTC)

Regulates and supervises all aspects of the Canadian broadcasting system

Define National Energy Board

Regulates the construction and operation of interprovincial and international pipeline and power lines

Define Economic Environment

Factors that influence consumer buying power and marketing strategies

Define Gross Domestic Product (GDP)

Sum of all goods and services produced by a nation in a year

Define Business Cycle

Pattern of stages in the level of economic activity

Stages in the Business Cycle

- Prosperity - Recession - Depression - Recovery

Explain Prosperity

Consumer spending is brisk; growth in services sector

Explain Recession

Consumers focus on basic, fundamental products

Explain Depression

Consumer spending sinks to its lowest

Explain Recovery

Consumer purchasing power increases

Define Inflation

Devalues money by reducing the products it can buy through persistent price increases

Impact of Deflation

- A free fall in business profits - Lower returns on most investments - Widespread job layoffs

Define Unemployment

Proportion of people in the economy who are actively seeking work but do not have jobs

DefineDiscretionary Income

The amount of money people have to spend after buying necessity items

Define Shortages

Result from lack of raw materials, component parts, energy and labour

Define Demarketing

Reducing consumer demand for a good or service to a level that the firm can supply

Technology leads to

- New products - Improvement in existing products - Better customer service - Reduced prices

Sources of technology

- Industry - Educational institutions - Not for profit institutions - Federal government

Value of technology

Marketers monitor new technology to gain a competitive edge and to enhance customer service

Define Voice Over Internet Protocol (VOIP)

Alternative to traditional telecommunications services

Define Internal Protocol Multimedia Subsystem (IMS)

Will offer new opportunities to marketers

The Social/Cultural Environment

The relationship between the marketer; society and culture

Define Consumerism

Social force within the environment that aids and protects the consumer by exerting legal, moral and economic pressures on the government and business

Define Marketing Ethics

Marketers' standards of conduct and moral values

Ethics in Marketing Research

Consumers are concerned about privacy

Ethics in Product Strategy

Product quality, obsolescence, brand similarity and packaging raise ethical issues

Ethics in Distribution

Determining the appropriate degree of control over the distribution channel

Ethics in Promotion

Truth in advertising

Ethics in Pricing

Credit card companies, payday loan companies and health clubs often was a fine line between being ethical and unethical

Ethics and Social Responsibility

- Philanthropic - Ethical - Legal - Economic

Philanthropic Factors

- Be a good corporate citizen - Contribute resources to the community - Improve quality of life

Ethical Factors

- Be ethical | - Obligation to do what is right, just and fair

Legal Factors

- Obey the law - Law is society's codification of right and wrong - Play by the rules of the game

Economic Factors

- Be profitable | - The foundation upon which all the others rest

Define Ecology

Relationship between organisms and their natural environments

Define Green Marketing

Production, promotion and reclamation of environmentally sensitive products

Define Divestiture

Is selling a division of part of an organization and is often used to raise capital for further strategic acquisitions or investments

Chapter 3 The Marketing Environment, Ethics and Social Responsibility Flashcards

(65 cards)