© 2004 mark h. hansen external factors in marketing
TRANSCRIPT
© 2004 Mark H. Hansen
External Factors External Factors in Marketingin Marketing
22
External Factors
Firm &Rivals
Suppliers
Buyers
SubstitutesEntry
Barriers
Legal
Ethical
Economic
Political
Technology
Social
Demographic
Global
General
Industry
33
External Factors
Porter’s Five Forces
Threat of Entry
Power of Suppliers
Power of Buyers
Threat of Substitutes
Threat of Rivalry Competitor Analysis
Consumer Behavior
44
External Factors
Porter’s Five Forces
Threat of Rivalry
High if:
• high fixed costs, storage costs
• many competitors, no leadership
Low if:
• competitors that recognize interdependence
• high or growing demand
55
External Factors
Porter’s Five Forces
Threat of Entry
• low barriers lead to high threat
• if more firms enter, profits are bid down
66
External Factors
Porter’s Five Forces
Power of Suppliers
• few, large suppliers relative to focal firm
High if:
• focal firm is highly dependent on supply
77
External Factors
Porter’s Five Forces
Power of Buyers
High if:
• few, large buyers relative to focal firm
• many buyers can act as a block (boycott)
88
External Factors
Porter’s Five Forces
Threat of Substitutes
High if:
• a close substitute exists
• a product which could fill the same need
Close substitutes create constraints on pricing
99
External Factors
Competitor Analysis
Who are they?
• firms that fill the same need
• products may not appear to compete
Who is Carmike Theater’s competition?
• should be able to name competitors
1010
External Factors
Competitor Analysis
What are their Objectives?
ORA Threat Model
What are their Resources?
Are their objectives and resources Aligned?
The level of threat depends on all three elements
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External Factors
General Environment
Look at the general environment to spot trends
• changing trends signal opportunity and threat
• changes across multiple elements combine tocreate opportunity or threat
• which elements have changed to give Subwaythe incentive to market Atkins friendly food?
1212
External Factors
General Environment
Technology: communications, medicine, packaging
Legal: active courts, product liability, deregulation
Global: IMF, WTO, WHO, trading blocks, terror threat
Social: health conscious, family issues, environment
1313
External Factors
General Environment
Demographics: age, income, education, ethnicity
Political: environmental, regulation, consumer advocacy
Ethical: honesty, fairness, pricing, use of data
Economic: interest rates, unemployment, inflation
1414
External Factors
Culture
• crosses the general-industry boundary
• may be shaped by external elements
• may shape external elements
• sum of learned beliefs, values, & customs
• effective marketers tap into these beliefs,values, & customs
1515
External Factors
Analysis of external factors:
• allows marketers to identify a need
• allows marketers to help customers recognizelatent needs
• informs marketers as to how best to fill needs
Superior external analysis can lead to competitive advantage