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Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-39
THE SWEETENER MARKET HANDOUT
ECONOMIC ENVIRONMENT
The U.S. and global economies are in the early stages of an economic recovery from the 2008 financial crisis. Since
January of 2012, disposable income has risen from $12 to $12.5 trillion according to data from the U.S. Bureau of
Economic Analysis reported for the third quarter of 2013. For the same time period, unemployment has decreased
from 8.5% to 7.2%.7 Stevia-based sweeteners are more expensive than their artificial counterparts, at least for now.
TECHNOLOGICAL ENVIRONMENT
In 1931, the chemicals that give stevia its sweetness were isolated. In 1995, The National Institutes of Heath
described the chemical structure of the molecules that stevia its sweetness. Another potential artificial sweetener is
COMPETITIVE ENVIRONMENT
There are two classes of sweeteners: natural and artificial, of which the latter are produced through chemistry. Until
recently, most firms in this market have focused on artificial sweeteners, such as aspartame, which was first used in
Diet Coke in 1982. As a result, this category currently dominates the market. As the leading segment in the market,
sugar is responsible for a nearly 50% share of all sales, while natural sweeteners and honey hold the remaining half
with honey having the smallest percentage.
Mintel recently estimated the sales of sugar and natural sweeteners remained flat at $4.6 billion in 2013 due to a
shift in consumer preferences toward natural sugar substitutes. The impact has been a decrease in artificial sweetener
Major competitors in the sweetener market include: Natural—Stevia: Truvía, PureVia, SweetLeaf, Stevia In The
Raw, and SteviaSweet RA98 and Artificial: Sweet ‘N Low, Equal, and Splenda (McNeil Nutritionals and Tate &
Lyle). Aspartame (Equal/NutraSweet) has the market share followed by sucralose (Splenda) and saccharin (Sweet
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-40
THE SWEETENER MARKET HANDOUT
COMPETITIVE ENVIRONMENT CONTINUED
Other notable sweetener marketers include: (1) The Whole Earth Sweetener Company, which is a wholly owned
subsidiary of the Merisant Company. It introduced Sweet Simplicity in 2006, which is based on erythritol, a sugar
Comparison of the Major Sweetener Brands
Company
Cargill/
Coca-
Cola
Whole
Earth
Sweetener
Co./Meri-
sant/
PepsiCo
Wisdom
Natural
Brands
Stevia in
the Raw
Cumber-
land
Packing
Corp.
Merisant
Company
McNeil
Nutri-
tionals/
Tate &
Lyle
Brand
Truvía
PureVia
SweetLeaf
Stevia in
the Raw
Sweet ’N
Low
Equal
Splenda
Key
Ingredient
Stevia
Stevia
Stevia
Stevia
Saccharin
Aspartame
Sucralose
Type
Natural
Natural
Natural
Natural
Artificial
Artificial
Artificial
Sweetness
Level
250-400
times >
sugar
250-400
times >
sugar
250-400
times >
sugar
300-400
times >
sugar
300 times >
sugar
180-200
times >
sugar
600 times >
sugar
Year
Introduced
2008
2008
2008
Late 1990s
1957
1981
2000
Package Color
Green
Green
Green
Green
Pink
Blue
Yellow
Sample Packet
MSRPs*
40-ct: $4.03
(10.1¢ per
packet)
40-ct: $2.45
(6.1¢ per
packet)
35-ct: $4.59
(13.1¢ per
packet)
50-ct: $3.65
(7.3¢ per
packet)
50-ct: $1.57
(3.5¢ per
packet)
250-ct: $4.98
(1.9¢ per
packet)†
100-ct: $4.73
(4.7¢ per
packet)
*Prices obtained at Mount Royal or online at Walmart
Finally, McNeil Nutritionals has a partnership with Tate & Lyle, the creator of sucralose, to create Splenda. Also,
there are private label brands, such as grocery marketer Kroger, which sell its Apriva brand stevia-based sweetener.
Foreign stevia marketers include China-based Sunwin International, which sells its OnlySweet brand in the U.S. In
2010, U.S. manufacturers of Reb A from stevia will face competition from Chinese firm Niutang, which also
supplies customers with sucralose and aspartame. The largest producer of stevia is GLG Life Tech, which has
plantations and processing operations in China.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
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THE SWEETENER MARKET HANDOUT
REGULATORY ENVIRONMENT
In 1921, stevia was presented to the U.S. Department of Agriculture as a “new sugar plant with great commercial
possibilities.”
In 1956, the Food and Agriculture Organization (FAO) of the United Nations and the World Health Organization
(WHO) established the Joint Expert Committee on Food Additives (JECFA) to evaluate the safety of food additives.
In 2004, JECFA establishes temporary Acceptable Daily Intake (ADI) of 2 mg/kg. The ADI is temporary pending
submission of additional safety data. This means that a 150 lb (68 kg) person could safely consume 151 mg
packages of sweetener made from Reb A every day over the course of his/her lifetime.
In 2008, the FAO/WHO/JECFA Expert Committee on Food Additives states that high purity (95%) steviol
glycosides are safe for use as an additive in food and beverages. Also, the FDA announces it has no objections to the
use of Cargill’s rebiana in food and beverages. It also finds that rebiana can now come under the category of
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
AN ENVIRONMENTAL SCAN FOR TRUVÍA HANDOUT ANSWERS
Environmental
Force
Positive Trend
Negative Trend
Social
• Desire to live a healthier lifestyle.
• Increased demand for sweeteners like
Truvía (tabletop or ingredient sugar
substitute).
• Increased use of stevia as additives in
foods and beverages.
• More obese people leading to more
diabetics.
• Fear of synthesized products due to
anecdotal evidence regarding
aspartame and saccharin.
• Low-carb craze could wane.
Economic
• Some consumers have the disposable
income to spend on healthier but
costlier sweeteners like Truvía.
• Consumers concerned about jobs and
income due to the recession.
• Consumers look for value.
• Consumers saving more.
Technological
• More engineered food additives being
developed for human consumption
(neotame).
• Stevia (Reb A) doesn’t seem to have
adverse side effects.
• Stevia (Reb A) marketers blend in
other substances to reduce aftertaste.
• Long-term studies on the effects of
stevia (Reb A) are not in yet.
• Demand creates supply/capacity
issues.
• R&D and FDA assessments are
expensive.
Competitive
• Stevia sales growing the fastest of any
sweetener—now 10% of total
sweetener sales after only 1 year.
• Additional stevia, natural, and
artificial sweeteners may come to
market.
• China becoming a force in the global
sweetener market: Local firms
produce and export stevia.
• NutraSweet/Equal, Sweet ‘N Low,
and Splenda are formidable
competitors, whose firms may
introduce stevia products in the future.
• Comparative ads could arise, pitting
Truvía against (1) stevia marketers
PureVia and Sun Crystals; (2) the
artificial sweetener marketers; and/or
(3) sugar marketers or its trade
association.
• Other competitors (firms from inside
and outside the U.S.) could enter this
growing and profitable market.
Regulatory
• FDA approved Truvía; deems it safe
as a food and beverage additive.
• Other countries like France, Australia,
etc. have approved Reb A, which
helps Truvía.
• FDA may withdraw stevia from the
market if there are health problems
attributed to its use.
• FDA approved neotame for use.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
AN ENVIRONMENTAL SCAN FOR TRUVÍA HANDOUT
ENVIRONMENTAL
FORCE
POSITIVE TRENDS
NEGATIVE TRENDS
SOCIAL
•
•
•
•
•
•
ECONOMIC
•
•
•
•
•
•
TECHNOLOGICAL
•
•
•
•
•
•
COMPETITIVE
•
•
•
•
•
•
REGULATORY
•
•
•
•
•
•
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
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ICA 3-2: IN-CLASS ACTIVITY
Competitive Intelligence15
Learning Objectives. To have students (1) learn about what competitive intelligence is and is
not in order to benefit from this practice and (2) identify possible sources of information to use
when gathering, analyzing, and acting on competitive intelligence.
Nature of the Activity. To have student teams (1) compare and contrast what competitive
intelligence is and is not in order to benefit from this practice and (2) assess two scenarios to
determine what competitive intelligence should be gathered.
Definition. The following marketing term is referred to in this in-class activity (ICA):
Estimated Class Time and Teaching Suggestions. About 25 minutes, taught in class in 4-
person teams.
• 5 minutes to explain the nature of this ICA and distribute the competitive intelligence
handouts to student teams.
Materials Needed.
• Copies for each student, either in hard copy or electronically, of the:
Steps to Teach this ICA.
2. Pass out copies of the “Competitive Intelligence” Handout and the “Competitive
Intelligence Brief” Handout to each student.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
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5. Show Slide 3-51. Have the student teams perform these tasks:
a. Read the two assigned descriptions and misconceptions of intelligence from the
Competitive Intelligence Handout.16
7. OPTIONAL: Have students respond to the following competitive intelligence
gathering scenarios. For each situation, read the description, ask 2 to 3 students what
competitive intelligence they would need, and then read the answer developed by
Fuld & Company.17
a. Scenario 1: New product rumor. Your best sources have heard a new product is
under development by a competitor. To protect your market share, you need to be
proactive. What kinds of competitive intelligence would you need to gather
quickly to act on the rumor?
Answer: The kinds of competitive intelligence you will need to gather include:
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-46
b. Scenario 2: New competitor in your market. A new player has entered your
turf. It could be an entrepreneurial start-up firm, a joint venture between
companies in other industries, or a newly created division of a large
conglomerate. Whatever form this new competitor takes, your must learn how its
presence in the market will affect your organization. What kinds of competitive
intelligence would you need to gather quickly to respond to the new competitor?
Answer: The kinds of competitive intelligence you will need to gather include:
– Products/services: How do they compare to your own (features, value, etc.)?
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
COMPETITIVE INTELLIGENCE HANDOUT (1)18
Business people misunderstand what competitive intelligence is and what it is not. Below are 10
descriptions and 10 misconceptions of what intelligence is.
Competitive Intelligence Is…
Competitive Intelligence Is Not…
Information that has been analyzed to the
point where you can make a decision. The
purpose of competitive intelligence is to make
decisions; the process of collecting and analyzing
data is the means to the end.
Spying. Spying implies illegal or unethical
activities. While spying does occur, it is rare.
Think about it: Corporations do not want to find
themselves in court for this illegal activity.
A tool to alert management to early warning of
both threats and opportunities. Given that
major industry changes can appear overnight,
marketers must create scenarios of possible
futures and then rigorously monitor the
competitive environment to compare the forecasts
with reality.
A crystal ball. While intelligence does give
corporations good approximations of reality, both
near- and long-term, it does not predict the future.
A means to deliver reasonable assessments.
Competitive intelligence offers approximations
and best views of the market and the competition
available at the time.
Database search. Databases do not massage or
analyze the data. Humans do by examining the
data and applying their common sense,
experience, analytical tools, and intuition to make
decisions.
Comes in many flavors. Competitive intelligence
can mean many things to many people. A
research scientist sees it as a heads-up on a
competitor’s new R&D initiatives. A salesperson
considers it when bidding against another firm in
order to win a contract. A senior manager
believes intelligence to be a long-term view on a
marketplace and its rivals.
The Internet or rumor chasing. The Internet is
primarily a communications vehicle, not a
deliverer of intelligence. You can find hints at
competitive strategy, but you will also uncover
rumors disguised as fact or speculation dressed up
as reality. Be wary. Its reach is great, but you
need to sift, sort, and be selective on its content.
A way for companies to improve their bottom
line. Many firms have increased their revenues
and profits as a result of the decisions made
possible by the effective use of competitive
intelligence.
Paper. Paper (including digital documents) is the
death of good intelligence. Think face-to-face
discussion or a quick phone call rather than paper
delivery. Never equate paper with competitive
intelligence. Many managers think that by
spending countless hours on PowerPoint slides,
charts, graphs, and footnoted reports, they have
delivered intelligence. In the process, they have
likely hidden the intelligence by over-analyzing it.
18 What Competitive Intelligence Is and Is Not! Used by permission. See http://www.fuld.com/Company/CI.html.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
COMPETITIVE INTELLIGENCE HANDOUT (2)
Competitive Intelligence Is…
Competitive Intelligence Is Not…
A way of life, a process. If a company uses
CI correctly, it becomes a way of life for
everyone in the corporation—not just the
strategic planning or marketing staff.
A job for one, smart person. One person
cannot do it all. At best, a CI coordinator
keeps management informed and ensures that
others in the organization become trained in
ways to apply this tool.
Part of all best-in-class companies. Quality-
focused firms apply competitive intelligence
consistently. The Malcolm Baldridge Quality
Award, the most prestigious total quality
award for American corporations, includes
the gathering and use of CI as a criterion.
An invention of the 20th century. CI has
been around as long as business itself. It may
have operated under a different name, or
under no name at all, but it was always
present.
Directed from the executive suite. The best-
in-class intelligence efforts receive their
direction and impetus from the CEO. While
the CEO may not run the program, he/she
dedicates budget and personnel. More
importantly, the CEO promotes its use.
Software. Software does not in and of itself
yield intelligence. Data warehousing and data
mining software packages can, in some cases,
analyze data. However, true analysis is a
process that involves people reviewing the
information and making strategic decisions.
Seeing outside the organization. Companies
that successfully apply competitive
intelligence gain an ability to see outside
themselves. CI pushes the not-invented-here
syndrome out the window.
A news story. Newspaper or television
reports are very broad and not timely enough
for managers concerned with specific
competitors and competitive issues. If a
manager first learns of an industry event from
a newspaper or magazine report, chances are
others in the industry have already learned of
the news through other channels. While
media reports may yield interesting sources
for the CI analyst to interview, they are not
always timely or specific enough for critical
business decisions.
Both short- and long-term. A company can
use intelligence for many immediate
decisions, such as how to price a product or
place an advertisement. At the same time, you
can use the same set of data to decide on
long-term product development or market
positioning.
A spreadsheet. “If it’s not a number, it’s not
intelligence.” This is an unspoken, but often
thought of, refrain among managers.
Intelligence comes in many forms, only one
of which is a spreadsheet or some
quantifiable result. Management thinking,
marketing strategy, and ability to innovate are
only three among a host of issues that rely on
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
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a wide range of subjective, non-numeric
intelligence.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
COMPETITIVE INTELLIGENCE BRIEF HANDOUT
SUMMARY OF TWO DESCRIPTIONS
•
•
SUMMARY OF TWO MISCONCEPTIONS
•
•
BENEFITS OF COMPETITIVE INTELLIGENCE
•
•
•
•
CONCERNS OF COMPETITIVE INTELLIGENCE
•
•
•
•
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-51
Exercise 1: Economic Forces
Activity Summary: This click and drag activity helps student understand the differences
between gross income, disposable income, and discretionary income. Each of the draggable
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Economic Environment
Learning Objective: LO 03-03 Discuss how economic forces affect marketing.
AACSB: Knowledge Application
Blooms: Understand
Difficulty Level: 2 Medium
Follow-Up Activity: This activity provides a perfect starting point for a discussion on personal
finance and financial responsibility. Provide student with a list of typical starting salaries for
Exercise 2: Geek Squad Video Case
Activity Summary: In this 8-minute video case, the impact of technological change and the
evolution of Geek Squad is explored. The television evening news program-style case explains
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topics: Demographic Environment, Social-cultural Environment, Technological Environment
Learning Objectives: LO 03-02 Describe social forces such as demographics and culture.
LO 03-04 Describe how technological changes can affect marketing.
AACSB: Knowledge Application
Blooms: Understand
Difficulty Level: 2 Medium
Follow-Up Activity: Instructors can use the Geek Squad case to discuss how the changing
technological factors affect the general cohorts differentially. Begin the activity by creating list
Exercise 3: iSeeit! Video Case: Macroenvironmental Scanning
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-52
Activity Summary: In this straightforward whiteboard animation video, macroenvironmental
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topics: Macroenvironment, Economic Environment, Technological Environment, Competitive
Environment, Political and Legal Environment
Learning Objectives: LO 03-01 Explain the purpose of environmental scanning.
LO 03-02 Describe social forces such as demographics and culture.
LO 03-04 Describe how technological changes can affect marketing.
LO 03-06 Explain how regulatory forces ensure competition and protect
producers and consumers.
AACSB: Knowledge Application
Blooms: Understand
Difficulty Level: 1 Easy
Follow-Up Activity: Instructors can follow up this introductory video with a quick Jeopardy-
style game which could easily be created with questions from the Kerin test bank. The
Exercise 4: Performing an Environmental Scan of Today’s Marketplace
Activity Summary: In this click and drag activity, students drag ten macroenvironmental factors
to their corresponding macroenvironmental force category (social, economic, technological,
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Macroenvironment
Learning Objectives: LO 03-01 Explain the purpose of environmental scanning.
LO 03-02 Describe social forces such as demographics and culture.
LO 03-04 Describe how technological changes can affect marketing.
LO 03-06 Explain how regulatory forces ensure competition and protect
producers and consumers.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-53
Follow-Up Activity: Instructors can follow up on the topic of macroenvironmental with a
discussion about where firms would likely locate the information to complete an environmental
Exercise 5: Concepts of Social Responsibility
Activity Summary: In this click and drag activity, students identify the differences between
societal responsibility, stakeholder responsibility, and profit responsibility. Students are provided
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Corporate Social Responsibility
Learning Objective: LO 03-08 Describe the different concepts of social responsibility.
AACSB: Ethics
Blooms: Analyze
Difficulty Level: 2 Medium
Follow-Up Activity: Instructors could ask students to review the annual reports for firm in
different industries such as Starbucks, Patagonia, Coca-Cola, Facebook, AstraZeneca, Ford
Exercise 6: iSeeit! Video Case: Ethical Marketing & Organization Mission
Activity Summary: In this straightforward whiteboard animation video, ethics, moral principles,
and social responsibility are explored in the context of a prospective employee deciding between
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Ethical Decision Making, Corporate Social Responsibility
Learning Objectives: LO 03-07 Identify factors that influence ethical and unethical marketing
decisions.
LO 03-08 Describe the different concepts of social responsibility.
Chapter 03 – Understanding the Marketing Environment, Ethical Behavior, and Social Responsibility
3-54
Follow-Up Activity: Instructors could ask students to place themselves in the case. Ask students
to consider the following questions: What level of importance do you place on the firm’s level of
Exercise 7: Ethical Marketing Behavior
Activity Summary: In this click and drag activity students read six unethical behavior scenarios
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Ethical Decision Making
Learning Objective LO 03-07 Identify factors that influence ethical and unethical marketing
decisions.
AACSB: Ethics
Blooms: Understand, Apply
Difficulty Level: 2 Medium
Follow-Up Activity: Students could be asked to research and share real-world examples of
unethical behavior in competition including examples of economic espionage and corruption.
Exercise 8: Toyota: Where the Future is Available Today
Activity Summary: This 8-minute video case describes Toyota’s transition from an automobile
company to a mobility company. The shift is discussed in the context of two key business values:
The Toyota Way and The Toyota Effect. In addition, the case presents the company’s
Tagging (Topic, Learning Objectives, AACSB, Bloom’s, Difficulty)
Topic: Ethical Decision Making
Learning Objective: LO 03-08 Describe the different concepts of social responsibility.
AACSB: Ethics
Blooms: Understand, Apply
Difficulty Level: 2 Medium
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