978-1259709074 Chapter 5 Solutions Manual

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Chapter 5 – Analyzing the Marketing Environment Marketing 6th

Answers to End of Chapter Learning Aids

Marketing Digitally

1 Seventh Generation is the leading brand of nontoxic, environmentally safe household

products in the United States. Visit its website (http://www.seventhgeneration.com) and review

the philosophy behind the business. Next, review the site to identify the products the

company offers. Briefly summarize some of the consumer trends you think are reflected.

Describe the ways in which Seventh Generation’s products address the wants and needs of its

customers.

Seventh Generation is an example of a firm that centers its marketing strategy around green,

2 Visit The Cool Hunter (http://www.thecoolhunter.net) and identify examples that would provide

marketers insights regarding social trends.

Information on this website is constantly changing in order to highlight “all things creative.” The purpose

3 Visit and explore the website of your favorite breakfast cereal. Identify the demographics of its

target customer. Evaluate the effectiveness of its marketing strategy.

Marketing Applications

1 Assume you are going to open a new store selling fitness products. Describe it. Who are your

competitors? What would you do to monitor your competitors’ actions? Who are your

customers? What are you going to do to appeal to them? What are your social

responsibilities, and how will you meet them?

This question asks students to think about what it would take to open a new store selling fitness products.

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1. How would your approach to buying a computer differ from your parents’ approach? What

about buying an outfit to wear to a party? How can firms use their knowledge of different

age or generational cohorts to market their products and services better?

Members of Generation Z were born into a world that was already full of electronic gadgets and digital

2. How can firms use customer demographics like income, market size, education, and

ethnicity to market to their customers better?

Demographic data indicates more than just income distribution, levels of education, or ethnicity within a

particular geographic area; marketers use this information to better understand their customers and

3. Identify some of the ethnicity changes in the United States. Describe how they might affect

the marketing practices of (a) a radio station in Texas, (b) food retailers in cities, and (c) a

home furnishing store in New York City.

Because of immigration and increasing birthrates among various ethnic and racial groups, the United

States continues to grow more diverse. Here are some of the effects on marketing practices:

(a) a radio station in Texas

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4. Identify some recent technological innovations in the marketplace and describe how they

have affected consumers’ everyday activities.

Students will provide various answers. Here are some of the more popular technological innovations:

5. Why should a T-shirt shop in the United States care about the value of the Hong Kong

dollar?

6. Several social trends were discussed in the chapter. For each of these trends, choose a

retailer or service provider that you believe has seized the moment by grasping the

importance of the trend and successfully marketing to its customers as a result.

Examples might include:

7. Identify a company that you believe does a particularly good job of marketing to different

cultural groups. Justify your answer.

8. Examine the consumer protection legislation in Exhibit 5.5. Which law do you believe has

had the biggest impact on society in general? Which has had the largest impact on you

personally? Justify your answer.

Quiz Yourself

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1 ABC Company knew that its customers were interested in environmentally friendly business

practices, so it began marking all of its products as environmentally friendly because they were made

with all-natural ingredients, even though ABC’s plant was one of the worst polluters in town. The new

term for this practice is

a. deceptive advertising.

b. greenwashing.

c. environmental exploitation.

d. virtual greening.

e. enviromarketing.

9. One of the goals of value-based marketing is

a. to provide the greatest value for the least profit.

b. to sell products for the highest possible price.

c. to offer greater value than competitors offer.

d. to determine the value of the brand.

e. to sell to all consumers, regardless of their needs.

Chapter Case Study: A Next-Generation Cleanser

1 What consumer trends does Seventh Generation respond to most effectively?

Seventh Generation does a great job of responding to the social trend of green marketing. Green

4 Which consumer trends might it be missing?

Additional Teaching Tips

Perhaps the most challenging aspect of this chapter is for students to truly understand the relationships

between the areas of the marketing environment. Since Exhibit 5.1 (Understanding the Marketing

Environment) appears to be self-explanatory, students tend to gloss over it in the reading since they

understand most of the vocabulary in the figure. Instructors may want to lead a group assignment in

which groups need to create a marketing situation that demonstrates the impact of the factors (instructors

can assign one per team, such as “social” to team 1, “economic” to team 2, and so on. The group also

needs to go one-step further in assessing that factor’s effect on the competition, corporate partners, the

company, and ultimately the consumer. The instructor also may elect to have teams come up with one

example of each of the factors (though this may be time consuming). Students will tend to shy away from

a marketing example so the instructor should emphasize it needs to be a clear marketing example.

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Once those examples are shared (perhaps put on the whiteboard or transferred to the transparency of the

figure), class discussion should follow addressing the impact of the environmental factors on the

marketing strategy and how it may even impact the SWOT.

Online Tip: This exercise is easily transferred to either an online team assignment or separate posts with

each of the external factors becoming one of the post topics (divide the class by last name alphabetically

to answer some of the posts or have students contribute one example to each of the posts/external

factors).

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Connect Activities

Activity Type Learning Objectives 05-

01 02 03 04

The Marketing Mix: Sporting Goods and Services Click & Drag X X

The Marketing Mix: Sporting Goods and Services

Activity Type: Click & Drag

Learning Objectives: 5-02, 5-03

Difficulty: Medium

Activity Summary: Students are asked to classify five different groups according to the type of

demographic variable it represents.

Activity

Introduction: Demographics indicate the characteristics of human population and segments,

especially those used to identify consumer markets. Demographic characteristics can include age,

gender, race, income, education, religion, and ethnicity. Marketers who are armed with demographic

information can tailor their promotional strategy to appeal to those demographic segments.

Categorize the following statements according to the attributes and trends that resulted from each

demographic characteristic.

Concept Review: In addition to understanding their customers, the company itself, their competition,

and their corporate partners in their immediate environment, marketers must also understand the

macroenvironmental factors that operate in the external environment. The primary components of the

macroenvironment are culture, demographics, social issues, technologic advances, economic

situation, and political/regulatory environment.

Follow-Up Activity

Suppose that you are a small manufacturer of athletic shoes. Choose one of the demographic groups

identified in the activity and create a simple marketing mix for that group: a product (or product line), a

price level, the type of store (or website) where the product should be sold, and some ideas about how to

promote the products.

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Dole Analyzes the Environment

Activity Type: Video Case

Learning Objectives: 5-02, 5-04

Difficulty: Medium

Activity Summary: This video explores how Dole has used what it learns by monitoring the

macroenvironment to identify product opportunities. After the video ends, students are asked

questions about the video and related course concepts.

Activity

Introduction: As the world’s largest producer and marketer of fruits and vegetables, Dole is

constantly analyzing the environment to make sure its marketing messages are on target.

Concept Review: One of the goals of value-based marketing is for the firm to provide consumers

Video: The video is presented to the student below the introductory information. The video plays

embedded on the page, after which questions are presented.

Follow-Up Activity

Divide the students into small groups. Ask each group to choose a specific social trend and then identify

some companies for which this trend creates opportunities. The examples in the textbook are off limits!

McDonald’s: Analyzing the Marketing Environment

Activity Type: Video Case

Learning Objectives: 5-02, 5-04

Difficulty: Medium

Activity Summary: Discusses how McDonald’s has responded to concerns about nutrition and

safety of its food. After the video ends, students are asked questions about the video and related

course concepts.

Activity

Introduction: McDonald’s has become more aware of recent changes in its customers’ wants with

regard to fast food, and the company has adapted its marketing mix accordingly. By paying close

attention to customer needs and continuously monitoring the business environment, McDonald’s can

identify potential opportunities.

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Concept Review: Consumers may be influenced by the actions of the focal company, the company’s

Ford: A New Car For a New Generation

Activity Type: Video Case

Learning Objectives: 05-02, 05-03, 05-04

Difficulty: Medium

Activity Summary: Discusses how Ford has responded to macroenvironmental trends in the

marketing of the Ford Fiesta. After the video ends, students are asked questions about the video and

related course concepts.

Activity

Introduction: Marketers use many factors to examine the environment when developing a new

product. In this video, you see how Ford created a new customer base for a comeback vehicle and

how the product was recreated, or repositioned, to fit Ford’s target market.

Concept Review: By paying close attention to customer needs and continuously monitoring the

Video: The video is presented to the student below the introductory information. The video plays

embedded on the page, after which questions are presented.

Follow-Up Activities

Either review the following articles with the class, or assign them for out-of-class reading:

http://www.forbes.com/sites/dalebuss/2013/08/22/thanks-to-fiesta-ford-leads-retail-growth-with-millen

nials/

http://www.jeffbullas.com/2010/02/18/the-7-secrets-to-fords-social-media-marketing-success/ (You

may have to click past a splash page or other ad)

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Seventh Generation:

Responding to the Marketing Environment

Activity Type: Case Analysis

Learning Objectives: 05-01, 05-02, 05-04

Difficulty: Hard

Activity Summary: Students answer questions applying the marketing strategy of Seventh

Generation, a “green” consumer products company, to chapter concepts.

Activity

Introduction: Taking an Iroquois directive—”In our every deliberation, we must consider the impact of

our decisions on the next seven generations”—the consumer product company Seventh Generation

has applied a distinctly modern sensibility to derive a long-term approach to the marketing

environment. Although its mission statement might be focused on future generations, Seventh

Generation has successfully appealed to current consumer demand for sustainable, environmentally

safe, green products. As its story illustrates, in a constantly changing marketing environment, success

depends on identifying opportunities and then responding quickly, accurately, and sensitively to

consumers.

Concept Review: Consumer demands and expectations are constantly changing, and marketers

Follow-Up Activity

Explore “greenwashing” in a class discussion. Three possible ways to do this:

Show the video in http://thegreenwashingblog.com/2014/02/25/marketing-and-greenwashing/ – a

five-minute video discussing the question “When does marketing become greenwashing?” It gets a

little bit dry but would work well for a more advanced class.

Show the video embedded in this blog entry:

http://thegreenwashingblog.com/2014/03/11/video-greenwashing-public-service-announcement/. In

this video, three ads with implied or overt greenwashing are dissected (and, frankly, ridiculed). It’s

silly, but raises questions about how much consumers really think about these questionable “green”

claims.

Discuss whether or not the students think consumers really care about “green.” If buying green

products really matters to consumers, what behaviors would they expect to see (willingness to pay

more, going to extra effort to find these products, researching green products)?

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adidas: Boost Technology and the Marketing Environment

Activity Type: Video Case

Learning Objectives: 05-01, 05-02, 05-04

Difficulty: Medium

Activity Summary: This video case describes an advanced technology adidas developed in a

partnership with a corporate partner to respond to trends in consumer preferences. After the video

ends, students are asked questions about the video and related course concepts.

Activity

Introduction: Adidas has developed Boost technology to improve performance of its running shoes,

offering superior cushioning. Adidas developed this innovation to respond to trends in the marketing

environment, and also to leverage its own capabilities and those of its partners.

Concept Review:

oCulture: The set of values, guiding beliefs, understandings, and ways of doing things shared by

members of a society.

Follow-Up Activities

Ask if any students are serious runners; if so, what kind of shoe (both features and brand) do they

prefer and why? Have their preferences changed over time?

Ask students to read some professional reviews of Boost products and report back—how innovative

do the experts consider this technology to be? (Note: adidas now has multiple Boost product lines:

Ultra Boost, Energy Boost, and Pure Boost.)

ISeeIt Video Case: Macroenvironmental Scanning

Activity Type: Video Case

Learning Objectives: 05-02

Difficulty: Easy

Activity Summary: This video case explores the different categories of macroenvironmental factors

from the perspective of Hope Springs, a bottled water company focusing on sustainability and

environmental protection.

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Activity

Introduction: Changes in the marketing environment are a source of opportunities and threats that

need to be continuously monitored. Through the scanning of macroenvironmental forces,

organizations can quickly identify trends and changes in the business climate that could significantly

impact their marketing strategies. Take for instance Hope Springs and how Julie, its marketing

executive, must consider how the external business environment impacts everything Hope Springs

does as a business. Social and demographic trends, or how society and consumers are changing,

have influenced the company’s decision to be sustainability focused. Similarly, Hope Springs’

understanding of political and legal issues in countries where it supports clean water initiatives has

helped define where to focus its sustainability efforts. Technology, which allowed Hope Springs to

develop an innovative bottle design, also provides an opportunity for consumers to find the nearest

bottle filling station. All of these external environments, along with an understanding of the

competitive landscape, are important considerations in the ongoing marketing activities of Hope

Springs.

Video: After the video ends, students are asked questions about the video and related course

concepts.

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