Week 02 · Introduction to Marketing
Davood Wadi, PhD
Welcome to Week 2 of Introduction to Marketing.
Today we will explore the forces that shape a company's marketing environment.
We will cover micro and macro-environmental factors, CSR, and marketing ethics.
We will also examine artificial intelligence as a force in the marketing environment and as a new subject for marketing ethics.
A company's marketing environment consists of the actors and forces outside marketing that affect marketing management's ability to build and maintain successful relationships with target customers.
It is made up of a microenvironment and a macroenvironment.
Marketers must be environmental trend trackers and opportunity seekers.
The microenvironment consists of the actors close to the company that affect its ability to serve its customers.
These actors include the company itself, suppliers, marketing intermediaries, customer markets, competitors, and publics.
Success depends on building relationships with other company departments and these external partners.
A yogurt brand depends on six kinds of actors close to it. Which actor is each one?
The farm provides an input the brand needs to make its product, so it is a supplier.
The chain sits between the brand and the people who buy, so it is a marketing intermediary.
They are the buyers the brand serves, so they belong to its customer markets.
It is chasing the same shoppers with a similar product, so it is a competitor.
The newspaper is not a partner or a buyer, but it can affect the brand's ability to serve customers. It is one of the publics.
Finance is another department inside the company, so it is part of the company itself.
The group has an interest in the company and can affect it, without buying from it or supplying it. It is one of the publics.
Which concept does this case show?
The macroenvironment consists of the larger societal forces that affect the microenvironment.
It shapes opportunities and poses threats to the company.
We often use the PESTLE framework to analyze these broad forces.
A juice company is planning next year. Is each change an actor close to the company or a larger societal force?
Tap a card, then tap the group it belongs to.
Political: Laws, government agencies, and pressure groups that influence or limit organizations and individuals.
Economic: Factors that affect consumer purchasing power and spending patterns, such as inflation and interest rates.
These forces dictate how a business can operate and whether consumers can afford their products.
Social: Institutions and other forces that affect a society's basic values, perceptions, preferences, and behaviors.
Technological: Forces that create new technologies, creating new product and market opportunities.
Marketers must track cultural trends and adopt relevant technologies to stay competitive.
Legal: Specific legislation protecting companies from each other, protecting consumers, and protecting the interests of society.
Environmental: Natural resources that are needed as inputs by marketers or that are affected by marketing activities.
Compliance and environmental sustainability are now baseline expectations for modern businesses.
Artificial intelligence shows how one development can touch several PESTLE forces at once.
Technological: AI agents can now search, compare, and buy on a consumer's behalf, creating new ways to reach customers.
Legal: New laws set rules for how companies use AI. The European Union's AI Act, for example, requires that people be told when they are talking to a chatbot and that AI-generated images, audio, and video imitating real people or events be labeled.
Social: Consumers differ in how much they trust AI to make choices for them, and this trust shapes how much buying they delegate.
Marketers who track these forces early can adapt their offerings and practices before competitors do.
Each change comes from artificial intelligence. Which PESTLE force does it touch?
A new technology opens a new way to reach customers: the agent searches, compares and buys for them.
A specific law sets a rule for how the company uses AI.
How much people trust AI to choose for them shapes how much buying they delegate.
Pressure groups that influence or limit organizations are part of the political force.
The rule that AI-generated video imitating real people be labeled comes from legislation.
Natural resources are needed as inputs, and they are affected by the activity.
Trust in AI differs between consumers, and low trust means less buying is delegated.
The store adapts to a new technology that creates a new way to reach customers.
Which concept does this case show?
Discussion: If a global coffee chain wants to enter a new emerging market, which PESTLE factor might pose the most immediate and unpredictable challenge to their launch strategy, and why?
Beyond analyzing the environment, companies must respond to societal expectations.
Corporate Social Responsibility involves self-regulating business models that help a company be socially accountable.
CSR is not just philanthropy, it is deeply integrated into the business strategy.
01Economic responsibility: To be profitable and economically viable.
02Legal responsibility: To obey the law and play by the rules.
03Ethical responsibility: To do what is right, just, and fair.
04Philanthropic responsibility: To contribute resources to the community and improve quality of life.
Which of the four responsibilities is each company acting on?
Staying profitable and economically viable is the economic responsibility.
It is obeying the law and playing by the rules.
No rule forces it. The company is doing what is right, just and fair.
It contributes resources to the community to improve quality of life.
Meeting the rules set by law is the legal responsibility.
Staying silent would be allowed. Being open with customers is doing what is fair.
Giving money to a community program is contributing resources to the community.
Keeping the business viable is the economic responsibility.
Which concept does this case show?
Consumers increasingly prefer to buy from companies that share their values.
CSR programs can improve employee morale, recruitment, and retention.
It also helps mitigate risks and can even reduce operational costs through sustainable practices.
Greenwashing occurs when a company spends more time and money claiming to be "green" than actually implementing business practices that minimize environmental impact.
It damages brand trust and can lead to legal penalties.
Transparency and authentic action are the only cures for greenwashing.
Discussion: When a retail brand publicly commits to sourcing 100% fair-trade materials, prices inevitably rise. Should the brand absorb the cost, or pass it on to consumers, and how does this affect their competitive positioning?
Marketing ethics are the broad guidelines that everyone in the organization must follow.
These policies cover
Good ethics is good business.
Deceptive pricing includes falsely advertising "factory" or "wholesale" prices or a large price reduction from a phony high retail price.
Deceptive promotion includes misrepresenting the product's features or performance.
These practices harm consumers and ultimately destroy brand equity.
Is each ad an example of deceptive pricing or deceptive promotion?
Tap a card, then tap the group it belongs to.
Involves persuading people to buy goods they had no thought of buying.
It is often used for unsought goods or in aggressive B2B environments.
High-pressure selling yields short-term gains but damages long-term relationships and reputation.
A dark pattern is a design that leads a person toward a choice they would not otherwise make, such as a fake countdown timer or a fee revealed only at checkout.
As AI agents shop for consumers, some sellers aim the same tricks at the agent instead of the person.
A seller may show a key fact, such as the price per ounce, only inside an image that the AI agent cannot read.
A seller may hide text on a product page, invisible to people, that instructs AI agents to recommend the product.
A seller may post fake reviews written to sway the AI agent's comparison.
Like deceptive pricing and promotion, these practices harm the consumer the agent works for and destroy trust in the brand once they are discovered.
Who is each design aimed at: the person, or the AI agent that shops for them? One is not a dark pattern at all.
Tap a card, then tap the group it belongs to.
Causing products to become obsolete before they actually need replacement.
Strategies include
While it drives frequent replacement sales, it raises significant environmental and ethical concerns.
Socially and environmentally responsible marketing that meets the present needs of consumers and businesses.
It also preserves or enhances the ability of future generations to meet their needs.
It goes beyond the marketing concept to adopt a societal marketing concept.
The marketing environment is dynamic and constantly evolving.
Companies must actively monitor micro and macro forces to seize opportunities and mitigate threats.
Ultimately, long-term success requires a commitment to ethical practices and genuine corporate social responsibility.
These commitments now extend to AI agents: a company that would not deceive a consumer should not deceive the AI agent that shops for one.