Marketing Study Set 1

Business

Quiz 3 :

The Marketing Environment

Quiz 3 :

The Marketing Environment

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For each of the following products, identify brand competitors, product competitors, generic competitors, and total budget competitors. a. Chevrolet Tahoe b. Levi's jeans c. Travelocity
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Below mentioned are the four types of competitors for Levi's jeans:
1) Brand competitor: Calvin Klein
2) Product competitor: Lee's Wrangler
3) Generic competitor: Tommy Hilfiger
4) Total budget competitor: Gap jeans
Travelocity: Below mentioned are the four types of competitors for Travelocity:
1) Brand competitor: Expedia.com
2) Product competitor: TravelNow.com
3) Generic competitor: Orbitz.com
4) Total budget competitors: CheapTickets.com

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The Federal Trade Commission To learn more about the Federal Trade Commission and its functions, visit the FTC's website at www.ftc.gov. Examine the sections entitled Newsroom and Formal Actions. Describe three recent incidents of illegal or inappropriate marketing activities and the FTC's response to those actions.
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Newsroom and Formal Actions sections of the Federal Trade Commission's website give information about the latest amendments in the rules and regulations and also about the latest illegal incidents and FTC's response to them. Newsroom section is responsible to keep the site updated with the latest development in rules and regulations.
Formal action section of the FTC's website gives full detail of all the illegal incidents and the FTC's response towards those incidents. This section also provides the judgement provided by the court of law against these illegal actions.
The three latest incidents of illegal activities and FTC's response to those activities are listed below:
1) FTC vs. Company GE : In this case, FTC alleged that Company GE has violated Section 7 of the Clayton Act and Section 5 of the Federal Trade Commission Act when it acquired the aviation operation of Avio S.P.A. FTC initiated an investigation of this proposed acquisition and filed a complaint in the court.
2) FTC vs. NM Inc. : In this case, FTC alleged that the respondent has violated the Federal Trade Commission Act along with the Fur Products Labelling Act. FTC initiated an investigation in this case and provided the copy of the draft of complaint to the respondent. The matter is still in court.
3) FTC vs. JD LLC : FTC alleged that JD has wrongly charged the customers on their cell phone bills. JD agreed to refund the amount to large number of customers and paid an additional $1.2 million to FTC as part of the settlement.

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Preserve Products Challenge Traditional Brands with Green Alternatives When entrepreneur Eric Hudson started Preserve® Products in 1996, people thought he was crazy. "When we first started the company, a lot of people looked at us like we had three heads, saying, 'Recycled materials are for ashtrays. Recycled materials are for pen holders,' " Hudson said. However, Hudson recognized that cultural values were beginning to shift toward green products. He founded Preserve Products, with the mission "to deliver consumer products that offer great looking design, high performance and are better for the environment than alternative products." The first Preserve product was its recyclable toothbrush. The toothbrush has become one of the organization's more popular products and even had an appearance as Will Ferrell's toothbrush in the movie Stranger than Fiction.More than 15 years later, the green revolution is in full swing and Preserve has become a multi-million dollar company with products available in over a dozen countries. Preserve takes plastics from products at the end of their life cycle and recycles them to create consumer goods such as toothbrushes, razors, kitchenware, mixing bowls, and storage containers. As green products become more mainstream, Preserve has seen an increase in demand from both retailers and consumers. Preserve products can now be found in Wegman's, Whole Foods, Trader Joe's, and Target. In addition to being recyclable, Preserve products are dishwasher safe and are manufactured in the United States. The company also guarantees that no products have been tested on animals and that it never uses ingredients that could potentially harm consumers. Preserve works to ensure that its products are well-designed and will last for a long time. In 2010 the company won the Spark International Design Silver Award for responsible packaging. Being a green company is not easy, particularly because many consumers believe that green products are costlier than traditional products. Economic forces like the latest recession have made the cost of goods an even greater concern for consumers. Additionally, greenwashing, or marketing products as being more environmentally-friendly than they really are, is also a problem for Preserve because then consumers become more cautious of trusting green marketing claims. As a result, Preserve works hard to deliver price-competitive, trustworthy products through legitimate retailers. In order to make its business work, Preserve forms partnerships with both organizations and consumers to get the materials it needs. It has strong relationships with companies like Brita and Seventh Generation, which send their waste to preserve to be recycled into new products. For instance, Preserve uses the plastic from Stonyfield Farm yogurt cups to create the handles of its recycled toothbrush. Support from these companies is crucial for Preserve to maintain its competitive advantage as a company that offers quality green products. Additionally, Preserve has been able to use consumers as suppliers. The company encourages their customers to send them used products when they reach the end of their life cycles rather than throwing them into landfills. In 2010 Preserve introduced the Mail-Back package at Whole Foods and Target for its recycled toothbrushes. The package not only protects the toothbrush but also allows consumers to use the package as a mailer to send it back to the company when they are finished with the product. Preserve can therefore reduce costs and widen its distribution range by incorporating consumers into the process. "They can facilitate being part of our supply chain," Hudson said. Despite its advantages, Preserve must constantly engage in environmental scanning and analysis to effectively respond to changing environmental forces. For instance, Preserve must try to understand consumer perceptions toward green products. One way Preserve achieves this is by remaining in constant dialogue with its customers. "We've sought to have a very innovative approach of really reaching out to our advocates," Hudson said. Preserve uses personal e-mails and electronic newsletters to answer concerns and update consumers on recent events. Preserve also must constantly analyze the competition. Brand competitors include not only other green consumer product firms but also big brand companies that sell more traditional products. Because the company operates in an environment of monopolistic competition, Preserve strives to differentiate its products and communicate their benefits to relevant stakeholders. Its recent initiative is to work with partners to recycle #5 plastic, which makes up 25 percent of plastic waste but is one of the least-recycled types of plastic. Preserve has come far in its short history, witnessing a sociocultural shift from little stakeholder concern for green products to strong stakeholder support. As the company continues to research innovative approaches toward reusing products and researching consumers, Preserve appears well poised to compete in the green marketplace. Which elements of the marketing mix are key to Preserve in dealing with competition?
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Entity 'P P' operates in an environment of monopolistic competition and its product include green consumer goods like toothbrushes, razors, kitchenware, mixing bowls. and storage containers. The substitutes for these products are traditional alternatives. So, brand promotion should be a major marketing tool for Entity 'P P'. The company should extensively promote its product as environmental-friendly and urge the consumers to use green products more and more.
Entity 'P P' also guarantees that its product has not been tested on animals and that it never uses ingredients that could potential harm consumers. So, Entity 'P P' can also appeal to health conscious people to use its products over traditional alternatives. Product differentiator can be another tool for Entity 'P P' in dealing with competition.
Entity 'P P' pitches that its consumer products lasts for a long time and are artistically designed. So, product differentiation will also help the company in dealing with competition. For price sensitive consumers, Entity 'P P' should try to convince them that its products are competitively priced and are value accretive in relation to their prices.

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A marketing strategy is dynamic. Companies must constantly monitor the marketing environment not only to create their marketing strategy but to revise it if necessary. Information about various forces in the marketplace is collected, analyzed, and used as a foundation for several marketing plan decisions. The following questions will help you to understand how the information in this chapter contributes to the development of your marketing plan. Describe the current competitive market for your product. Can you identify the number of brands or market share they hold? Expand your analysis to include other products that are similar or could be substituted for yours. The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com.
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Whole Foods Capitalizes on Consumer Desires for Organic Food Whole Foods Market's emphasis on organic food and sustainable fishing practices is not just socially responsible business but also good marketing. Whole Foods has adopted the value of putting the customer first. It keeps this value in mind when conducting environmental scanning to understand the different forces in the marketing environment. By paying careful attention to changing trends, Whole Foods has been able to identify major concerns and tailor its business practices accordingly. For instance, Whole Foods banned the use of the chemical compound Bisphenol-A from its baby bottles and cups even before the Food and Drug Administration recognized that it could be potentially harmful for children. Whole Foods was started as a natural foods market in 1980. Through a series of acquisitions the company expanded from a small Austin-based market into a national organic food chain. However, as organic food became more popular, competition increased. Its rival Trader Joe's, for instance, guarantees that products sold under its private- label brand are free from preservatives, genetically-modified ingredients, and trans fats. Whole Foods products are often more expensive than the competition, requiring consumers to spend more disposable income at its stores. These factors require Whole Foods to constantly examine its environment and modify its marketing strategies to increase consumers' willingness to spend in its stores. One way that Whole Foods has successfully grabbed market share in the organic food industry is by offering a superior product. Whole Foods Market created its own system of quality standards for its food products to assure consumers that it is purchasing superior products, including promoting organically grown foods, selling food that is free from preservatives and sweeteners, and carefully choosing each product in the mix. Whole Foods also tries to create an exciting customer experience in its stores with its free in-store samples, quality customer service, and environmentally- friendly practices. In 2009, Whole Foods decided to embark upon a healthy living marketing initiative. CEO and co-founder John Mackey believed Whole Foods was deviating from its core principles by selling certain products that were unhealthy. That year Whole Foods adopted a new core value: "Promoting the health of our stakeholders through healthy eating education." Whole Foods partnered with healthy-eating partners to help it educate its stakeholders about healthy food choices. Whole Foods stores began to post healthy eating information and recipes throughout its stores and began selling healthy eating cookbooks. For its employee stakeholders, Whole Foods began offering programs to help employees live more healthy lives and provided additional employee discounts to those who achieved health objectives. Whole Foods also recognizes the importance of environment, particularly regarding the precarious nature of the world's fisheries. Whole Foods became the first supermarket to offer Marine Stewardship Council (MSC)-certified seafood. Whole Foods has a rating system that color codes the wild-caught seafood it sells into three ratings: green (sustainable seafood), yellow (medium danger of being overfished), and red (in serious danger of being overfished). Whole Foods has committed to phasing out all red-rated seafood species by 2013. Whole Foods' products and sustainability initiatives have factors on its side. The company has been able to benefit from sociocultural perspectives supporting natural and organic food. Whole Foods can also profit, albeit indirectly, from political forces. With the government's fight against childhood obesity and its push for healthier eating, companies like Whole Foods that market healthy food options are likely to prosper. However, Whole Foods does have one major disadvantage: its higher price points, while signaling the fact that it sells premium products, can also harm the company during a recession. When the recession hit, Whole Foods had to make quick changes to its pricing strategies to retain customers. It lowered prices on some of its brands and began to sell "extreme value items" at very low prices. Its adaptions to economic conditions have allowed the company to survive and even prosper. Whole Foods is a good example of a company that offers premium products consumers desire. Whole Foods customers like the company so much that the company has made Fortune's list for "World's Most Admired Companies." How does the company adjust to changes in economic conditions?
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A marketing strategy is dynamic. Companies must constantly monitor the marketing environment not only to create their marketing strategy but to revise it if necessary. Information about various forces in the marketplace is collected, analyzed, and used as a foundation for several marketing plan decisions. The following questions will help you to understand how the information in this chapter contributes to the development of your marketing plan. Referring to Tables 3.2 and 3.3, do you recognize any laws or regulatory agencies that would have jurisdiction over your type of product? The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com. img img
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Preserve Products Challenge Traditional Brands with Green Alternatives When entrepreneur Eric Hudson started Preserve® Products in 1996, people thought he was crazy. "When we first started the company, a lot of people looked at us like we had three heads, saying, 'Recycled materials are for ashtrays. Recycled materials are for pen holders,' " Hudson said. However, Hudson recognized that cultural values were beginning to shift toward green products. He founded Preserve Products, with the mission "to deliver consumer products that offer great looking design, high performance and are better for the environment than alternative products." The first Preserve product was its recyclable toothbrush. The toothbrush has become one of the organization's more popular products and even had an appearance as Will Ferrell's toothbrush in the movie Stranger than Fiction.More than 15 years later, the green revolution is in full swing and Preserve has become a multi-million dollar company with products available in over a dozen countries. Preserve takes plastics from products at the end of their life cycle and recycles them to create consumer goods such as toothbrushes, razors, kitchenware, mixing bowls, and storage containers. As green products become more mainstream, Preserve has seen an increase in demand from both retailers and consumers. Preserve products can now be found in Wegman's, Whole Foods, Trader Joe's, and Target. In addition to being recyclable, Preserve products are dishwasher safe and are manufactured in the United States. The company also guarantees that no products have been tested on animals and that it never uses ingredients that could potentially harm consumers. Preserve works to ensure that its products are well-designed and will last for a long time. In 2010 the company won the Spark International Design Silver Award for responsible packaging. Being a green company is not easy, particularly because many consumers believe that green products are costlier than traditional products. Economic forces like the latest recession have made the cost of goods an even greater concern for consumers. Additionally, greenwashing, or marketing products as being more environmentally-friendly than they really are, is also a problem for Preserve because then consumers become more cautious of trusting green marketing claims. As a result, Preserve works hard to deliver price-competitive, trustworthy products through legitimate retailers. In order to make its business work, Preserve forms partnerships with both organizations and consumers to get the materials it needs. It has strong relationships with companies like Brita and Seventh Generation, which send their waste to preserve to be recycled into new products. For instance, Preserve uses the plastic from Stonyfield Farm yogurt cups to create the handles of its recycled toothbrush. Support from these companies is crucial for Preserve to maintain its competitive advantage as a company that offers quality green products. Additionally, Preserve has been able to use consumers as suppliers. The company encourages their customers to send them used products when they reach the end of their life cycles rather than throwing them into landfills. In 2010 Preserve introduced the Mail-Back package at Whole Foods and Target for its recycled toothbrushes. The package not only protects the toothbrush but also allows consumers to use the package as a mailer to send it back to the company when they are finished with the product. Preserve can therefore reduce costs and widen its distribution range by incorporating consumers into the process. "They can facilitate being part of our supply chain," Hudson said. Despite its advantages, Preserve must constantly engage in environmental scanning and analysis to effectively respond to changing environmental forces. For instance, Preserve must try to understand consumer perceptions toward green products. One way Preserve achieves this is by remaining in constant dialogue with its customers. "We've sought to have a very innovative approach of really reaching out to our advocates," Hudson said. Preserve uses personal e-mails and electronic newsletters to answer concerns and update consumers on recent events. Preserve also must constantly analyze the competition. Brand competitors include not only other green consumer product firms but also big brand companies that sell more traditional products. Because the company operates in an environment of monopolistic competition, Preserve strives to differentiate its products and communicate their benefits to relevant stakeholders. Its recent initiative is to work with partners to recycle #5 plastic, which makes up 25 percent of plastic waste but is one of the least-recycled types of plastic. Preserve has come far in its short history, witnessing a sociocultural shift from little stakeholder concern for green products to strong stakeholder support. As the company continues to research innovative approaches toward reusing products and researching consumers, Preserve appears well poised to compete in the green marketplace. Describe the target market for Preserve products.
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The Federal Trade Commission To learn more about the Federal Trade Commission and its functions, visit the FTC's website at www.ftc.gov. Based on information on the website, describe the FTC's impact on marketing.
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Preserve Products Challenge Traditional Brands with Green Alternatives When entrepreneur Eric Hudson started Preserve® Products in 1996, people thought he was crazy. "When we first started the company, a lot of people looked at us like we had three heads, saying, 'Recycled materials are for ashtrays. Recycled materials are for pen holders,' " Hudson said. However, Hudson recognized that cultural values were beginning to shift toward green products. He founded Preserve Products, with the mission "to deliver consumer products that offer great looking design, high performance and are better for the environment than alternative products." The first Preserve product was its recyclable toothbrush. The toothbrush has become one of the organization's more popular products and even had an appearance as Will Ferrell's toothbrush in the movie Stranger than Fiction.More than 15 years later, the green revolution is in full swing and Preserve has become a multi-million dollar company with products available in over a dozen countries. Preserve takes plastics from products at the end of their life cycle and recycles them to create consumer goods such as toothbrushes, razors, kitchenware, mixing bowls, and storage containers. As green products become more mainstream, Preserve has seen an increase in demand from both retailers and consumers. Preserve products can now be found in Wegman's, Whole Foods, Trader Joe's, and Target. In addition to being recyclable, Preserve products are dishwasher safe and are manufactured in the United States. The company also guarantees that no products have been tested on animals and that it never uses ingredients that could potentially harm consumers. Preserve works to ensure that its products are well-designed and will last for a long time. In 2010 the company won the Spark International Design Silver Award for responsible packaging. Being a green company is not easy, particularly because many consumers believe that green products are costlier than traditional products. Economic forces like the latest recession have made the cost of goods an even greater concern for consumers. Additionally, greenwashing, or marketing products as being more environmentally-friendly than they really are, is also a problem for Preserve because then consumers become more cautious of trusting green marketing claims. As a result, Preserve works hard to deliver price-competitive, trustworthy products through legitimate retailers. In order to make its business work, Preserve forms partnerships with both organizations and consumers to get the materials it needs. It has strong relationships with companies like Brita and Seventh Generation, which send their waste to preserve to be recycled into new products. For instance, Preserve uses the plastic from Stonyfield Farm yogurt cups to create the handles of its recycled toothbrush. Support from these companies is crucial for Preserve to maintain its competitive advantage as a company that offers quality green products. Additionally, Preserve has been able to use consumers as suppliers. The company encourages their customers to send them used products when they reach the end of their life cycles rather than throwing them into landfills. In 2010 Preserve introduced the Mail-Back package at Whole Foods and Target for its recycled toothbrushes. The package not only protects the toothbrush but also allows consumers to use the package as a mailer to send it back to the company when they are finished with the product. Preserve can therefore reduce costs and widen its distribution range by incorporating consumers into the process. "They can facilitate being part of our supply chain," Hudson said. Despite its advantages, Preserve must constantly engage in environmental scanning and analysis to effectively respond to changing environmental forces. For instance, Preserve must try to understand consumer perceptions toward green products. One way Preserve achieves this is by remaining in constant dialogue with its customers. "We've sought to have a very innovative approach of really reaching out to our advocates," Hudson said. Preserve uses personal e-mails and electronic newsletters to answer concerns and update consumers on recent events. Preserve also must constantly analyze the competition. Brand competitors include not only other green consumer product firms but also big brand companies that sell more traditional products. Because the company operates in an environment of monopolistic competition, Preserve strives to differentiate its products and communicate their benefits to relevant stakeholders. Its recent initiative is to work with partners to recycle #5 plastic, which makes up 25 percent of plastic waste but is one of the least-recycled types of plastic. Preserve has come far in its short history, witnessing a sociocultural shift from little stakeholder concern for green products to strong stakeholder support. As the company continues to research innovative approaches toward reusing products and researching consumers, Preserve appears well poised to compete in the green marketplace. What environmental forces will be most important to understand for Preserve to be successful?
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Technological advances and sociocultural forces have a great impact on marketers. Identify at least one technological advance and one sociocultural change that has affected you as a consumer. Explain the impact of each change on your needs as a customer.
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Assume you are opening one of the following retail stores. Identify publications at the library or online that provide information about the environmental forces likely to affect the store. Briefly summarize the information each source provides. a. Convenience store b. Women's clothing store c. Grocery store d. Fast-food restaurant e. Furniture store
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In what ways can each of the business cycle stages affect consumers' reactions to marketing strategies?
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Why are environmental scanning and analysis important to marketers?
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What business cycle stage are we experiencing currently? How is this stage affecting business firms in your area?
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Whole Foods Capitalizes on Consumer Desires for Organic Food Whole Foods Market's emphasis on organic food and sustainable fishing practices is not just socially responsible business but also good marketing. Whole Foods has adopted the value of putting the customer first. It keeps this value in mind when conducting environmental scanning to understand the different forces in the marketing environment. By paying careful attention to changing trends, Whole Foods has been able to identify major concerns and tailor its business practices accordingly. For instance, Whole Foods banned the use of the chemical compound Bisphenol-A from its baby bottles and cups even before the Food and Drug Administration recognized that it could be potentially harmful for children. Whole Foods was started as a natural foods market in 1980. Through a series of acquisitions the company expanded from a small Austin-based market into a national organic food chain. However, as organic food became more popular, competition increased. Its rival Trader Joe's, for instance, guarantees that products sold under its private- label brand are free from preservatives, genetically-modified ingredients, and trans fats. Whole Foods products are often more expensive than the competition, requiring consumers to spend more disposable income at its stores. These factors require Whole Foods to constantly examine its environment and modify its marketing strategies to increase consumers' willingness to spend in its stores. One way that Whole Foods has successfully grabbed market share in the organic food industry is by offering a superior product. Whole Foods Market created its own system of quality standards for its food products to assure consumers that it is purchasing superior products, including promoting organically grown foods, selling food that is free from preservatives and sweeteners, and carefully choosing each product in the mix. Whole Foods also tries to create an exciting customer experience in its stores with its free in-store samples, quality customer service, and environmentally- friendly practices. In 2009, Whole Foods decided to embark upon a healthy living marketing initiative. CEO and co-founder John Mackey believed Whole Foods was deviating from its core principles by selling certain products that were unhealthy. That year Whole Foods adopted a new core value: "Promoting the health of our stakeholders through healthy eating education." Whole Foods partnered with healthy-eating partners to help it educate its stakeholders about healthy food choices. Whole Foods stores began to post healthy eating information and recipes throughout its stores and began selling healthy eating cookbooks. For its employee stakeholders, Whole Foods began offering programs to help employees live more healthy lives and provided additional employee discounts to those who achieved health objectives. Whole Foods also recognizes the importance of environment, particularly regarding the precarious nature of the world's fisheries. Whole Foods became the first supermarket to offer Marine Stewardship Council (MSC)-certified seafood. Whole Foods has a rating system that color codes the wild-caught seafood it sells into three ratings: green (sustainable seafood), yellow (medium danger of being overfished), and red (in serious danger of being overfished). Whole Foods has committed to phasing out all red-rated seafood species by 2013. Whole Foods' products and sustainability initiatives have factors on its side. The company has been able to benefit from sociocultural perspectives supporting natural and organic food. Whole Foods can also profit, albeit indirectly, from political forces. With the government's fight against childhood obesity and its push for healthier eating, companies like Whole Foods that market healthy food options are likely to prosper. However, Whole Foods does have one major disadvantage: its higher price points, while signaling the fact that it sells premium products, can also harm the company during a recession. When the recession hit, Whole Foods had to make quick changes to its pricing strategies to retain customers. It lowered prices on some of its brands and began to sell "extreme value items" at very low prices. Its adaptions to economic conditions have allowed the company to survive and even prosper. Whole Foods is a good example of a company that offers premium products consumers desire. Whole Foods customers like the company so much that the company has made Fortune's list for "World's Most Admired Companies." How has Whole Foods been successful in the highly competitive supermarket industry?
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Whole Foods Capitalizes on Consumer Desires for Organic Food Whole Foods Market's emphasis on organic food and sustainable fishing practices is not just socially responsible business but also good marketing. Whole Foods has adopted the value of putting the customer first. It keeps this value in mind when conducting environmental scanning to understand the different forces in the marketing environment. By paying careful attention to changing trends, Whole Foods has been able to identify major concerns and tailor its business practices accordingly. For instance, Whole Foods banned the use of the chemical compound Bisphenol-A from its baby bottles and cups even before the Food and Drug Administration recognized that it could be potentially harmful for children. Whole Foods was started as a natural foods market in 1980. Through a series of acquisitions the company expanded from a small Austin-based market into a national organic food chain. However, as organic food became more popular, competition increased. Its rival Trader Joe's, for instance, guarantees that products sold under its private- label brand are free from preservatives, genetically-modified ingredients, and trans fats. Whole Foods products are often more expensive than the competition, requiring consumers to spend more disposable income at its stores. These factors require Whole Foods to constantly examine its environment and modify its marketing strategies to increase consumers' willingness to spend in its stores. One way that Whole Foods has successfully grabbed market share in the organic food industry is by offering a superior product. Whole Foods Market created its own system of quality standards for its food products to assure consumers that it is purchasing superior products, including promoting organically grown foods, selling food that is free from preservatives and sweeteners, and carefully choosing each product in the mix. Whole Foods also tries to create an exciting customer experience in its stores with its free in-store samples, quality customer service, and environmentally- friendly practices. In 2009, Whole Foods decided to embark upon a healthy living marketing initiative. CEO and co-founder John Mackey believed Whole Foods was deviating from its core principles by selling certain products that were unhealthy. That year Whole Foods adopted a new core value: "Promoting the health of our stakeholders through healthy eating education." Whole Foods partnered with healthy-eating partners to help it educate its stakeholders about healthy food choices. Whole Foods stores began to post healthy eating information and recipes throughout its stores and began selling healthy eating cookbooks. For its employee stakeholders, Whole Foods began offering programs to help employees live more healthy lives and provided additional employee discounts to those who achieved health objectives. Whole Foods also recognizes the importance of environment, particularly regarding the precarious nature of the world's fisheries. Whole Foods became the first supermarket to offer Marine Stewardship Council (MSC)-certified seafood. Whole Foods has a rating system that color codes the wild-caught seafood it sells into three ratings: green (sustainable seafood), yellow (medium danger of being overfished), and red (in serious danger of being overfished). Whole Foods has committed to phasing out all red-rated seafood species by 2013. Whole Foods' products and sustainability initiatives have factors on its side. The company has been able to benefit from sociocultural perspectives supporting natural and organic food. Whole Foods can also profit, albeit indirectly, from political forces. With the government's fight against childhood obesity and its push for healthier eating, companies like Whole Foods that market healthy food options are likely to prosper. However, Whole Foods does have one major disadvantage: its higher price points, while signaling the fact that it sells premium products, can also harm the company during a recession. When the recession hit, Whole Foods had to make quick changes to its pricing strategies to retain customers. It lowered prices on some of its brands and began to sell "extreme value items" at very low prices. Its adaptions to economic conditions have allowed the company to survive and even prosper. Whole Foods is a good example of a company that offers premium products consumers desire. Whole Foods customers like the company so much that the company has made Fortune's list for "World's Most Admired Companies." How will changes in sociocultural forces provide opportunities for Whole Foods in the future?
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Competitive forces are very important to companies, particularly those that operate in many different countries. However, the importance of each competitive force might vary depending upon the industry. For instance, legal and regulatory forces limit many of the activities of cigarette fi rms. While rising prices might affect the purchase of luxury goods, necessities like diapers and antibiotics will not experience as much of an impact, because people require them whether the prices are high or not. With this in mind, examine the impact that economic forces, political forces, legal and regulatory forces, technological forces, and sociocultural forces have upon ExxonMobil, General Motors, and Procter Gamble. Rate each of these factors on a scale of 1-5, from 5 meaning most important to 1 meaning least important. Based on these companies, which environmental variable do you think would be the highest priority for each company, and why? Based on these three companies, which environmental variable do you feel would be most important for marketers?
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What are the four types of competition? Which is most important to marketers?
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A marketing strategy is dynamic. Companies must constantly monitor the marketing environment not only to create their marketing strategy but to revise it if necessary. Information about various forces in the marketplace is collected, analyzed, and used as a foundation for several marketing plan decisions. The following questions will help you to understand how the information in this chapter contributes to the development of your marketing plan. Using the business cycle pattern, in which of the four stages is the current state of the economy? Can you identify any changes in consumer buying power that would affect the sale and use of your product? The information obtained from these questions should assist you in developing various aspects of your marketing plan found in the "Interactive Marketing Plan" exercise at www.cengagebrain.com.
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The Federal Trade Commission To learn more about the Federal Trade Commission and its functions, visit the FTC's website at www.ftc.gov. How could the FTC's website assist a company in avoiding misconduct?
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