Page 112 - Foundations of Marketing

The Marketing Environment, Social Responsibility, and Ethics | Chapter 3 79

Chapter Review

1. Recognize the importance of the marketing quality of life. Sociocultural forces are the influences in a
environment. society that bring about changes in attitudes, beliefs, norms,
customs, and lifestyles. Changes in any of these forces can
The marketing environment consists of external forces that
create opportunities and threats for marketers.
directly or indirectly influence an organization’s acquisition
of inputs and creation of outputs. To monitor changes in the 2. Understand the concept and dimensions
marketing environment effectively, marketers engage in envi-
ronmental scanning and analysis. Environmental scanning is of social responsibility in marketing.
the process of collecting information about the forces in the Social responsibility refers to an organization’s obligation
marketing environment; environmental analysis is the pro- to maximize its positive impact and minimize its negative
cess of assessing and interpreting the information gathered impact on society. Whereas social responsibility is achieved
through environmental scanning. This information helps mar- by balancing the interests of all stakeholders in an organiza-
keting managers to minimize uncertainty and threats and cap- tion, ethics relates to acceptable standards of conduct in mak-
italize on opportunities presented by environmental factors. ing individual and group decisions. At the most basic level,
Marketers need to monitor the actions of competitors companies have an economic responsibility to be profitable
to determine what strategies competitors are using and how so that they can provide a return on investment to their stock-
those strategies affect their own. Economic conditions influ- holders, create jobs for the community, and contribute goods
ence consumers’ buying power and willingness to spend. and services to the economy. Marketers are also expected to
Legislation is enacted, legal decisions are interpreted by obey laws and regulations. Marketing ethics refers to princi-
courts, and regulatory agencies are created and operated by ples and standards that define acceptable conduct in marketing
elected or appointed officials. Marketers also can choose to as determined by various stakeholders. Philanthropic respon-
regulate themselves. Technology determines how members sibilities go beyond marketing ethics; they are not required of
of society satisfy needs and wants and helps improve the a company but promote human welfare and goodwill.

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Key Concepts

environmental scanning 54 monopolistic Federal Trade Commission marketing citizenship 70
environmental analysis 54 competition 57 (FTC) 63 ethical issue 73
competition 56 pure competition 57 Better Business Bureau 65 cause-related
brand competitors 56 buying power 58 National Advertising Review marketing 74
product competitors 56 disposable income 58 Board (NARB) 65 strategic philanthropy
total budget competitors 56 discretionary income 58 technology 66 approach 74
monopoly 57 willingness to spend 59 sociocultural forces 67 consumerism 76
oligopoly 57 business cycle 59 social responsibility 69 codes of conduct 77

Issues for Discussion and Review

1. Why are environmental scanning and analysis important 3. Define income, disposable income, and discretionary
to marketers? income. How does each type of income affect consumer
2. What are four types of competition? Which is most buying power?
important to marketers? 4. What factors influence a buyer’s willingness to spend?

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