ENVIRONMENTAL SCANNING
Environmental scanning is a process of gathering, analyzing, and dispensinginformation for tactical or strategic purposes. The environmental scanning processentails obtaining both factual and subjective information on the businessenvironments in which a company is operating or considering entering.Environmental scanning is the process in which a firm continually collects andevaluates information about its external environment. There are six main categoriesof environmental data to consider when evaluating marketing decisions. These aresocial forces, demographic forces, economic forces, technological forces, politicaland legal forces, and competitive forces.
There are several marketing procedures to consider
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While some of the demand drivers are off-shoots of favourable growth in the Indian economy, others have come by due to the comprehensive development of the Automobile segment.
The key demand drivers for the automobile segment are shown below:
Increase in income levels and thus purchasing power: Increase in disposable incomes have made cars affordable to a larger section of the population. While the ratio of car prices to average monthly salaries was around 36 - 48 months in the past, it has dropped significantly to less than 24 months currently. This is also a result of decreasing automobile prices with increasing efficiency in production and stiff competition in the market.
• Gradual shift to higher segment passenger vehicles: B and C segments have emerged as high growth segments over the last few years. In 2001-02, the A segment accounted for around 28% of sales while in 2004-05 it accounted for only 14%. At the same time, the demand for premium vehicles has also grown significantly, though the volumes are still low compared with other segments. The trend in segmental sales is poised to undergo a sea change with the launch of high volume selling Tata Nano and other players eyeing to get into the ultra low-cost segment.
• Availability of a wider range of products: The number of players as well as the number of products in the auto OEM space has
1. Environmental scanning – A version of environmental scanning in which the firm identifies desirable markets by using the environmental forces to eliminate the less desirable markets
During this time period, America saw a great change in its economy. After WWI, many citizens had extra time and extra money. Due to the surplus, they were eager to attain a variety of new products on the market. The greatest example of these technologies is the automobile. Not only did the car become affordable through the use of assembly lines, but it also gave the public an opportunity to travel and live in areas other than the city. Although there was not a great selection of cars back then, progressive advertisement strategies persuaded the public that they indeed needed a car.
How should this market be segmented? Identify the key segmentation variables that are relevant for this market.
In this year Henry Ford created the first affordable, combustion engine car called the Model-T. The creation of the Model-T changed the lives of every American. Vehicles were looked at as a way of freedom and excitement. Soon after, every household in America had a car. The demand for vehicles sparked a whole new industry, creating jobs, more revenues and improving the American economy in every way. With so many vehicles on the roads, roads needed to
To stay tuned to the recent situation in order not to miss perspective opportunities, an organization should go on with continuous scanning of its environment. According to Jobber, environmental scanning is “the process of monitoring and analyzing the marketing environment of a company” (Jobber, 2010, p.93). Aguilar states (Aguilar, 1967, cited in Costa, 1995, pp.4-5) that environmental scanning serves the purpose of gathering information about the facts and events happening around the company in order to let the management lead the organization in the right direction. Most of the authors agree on the same main function of environmental scanning.
The automotive industry designs, develops, manufactures, markets and sells motor vehicles, and is one of the world’s most important economic divisions by profits. This analysis focuses on the industry, specifically, manufacturers of automobiles. There are five competitors in the StratSim environment: Firm A, B, C, D, and E. Industry sales in the most recent year were 4.3 million units, with expected growth in the next year. Within this industry, there are seven-vehicle classes: Economy, Family, Luxury, Sports, Minivan, Truck, and Utility. There are two new classes with potential – if properly marketed.
The Christian Church acquired a lot of power at this time, so, it was only natural to appoint a leader of the entire church. Thus, the doctrine of Petrine supremacy was implemented. Its roots taken directly from the New Testament, this doctrine proclaimed that “...the bishop of Rome (the pope) as the successor of Saint Peter (traditionally considered as the first bishop of Rome), should hold a preeminent position in the church (Spielvogel, page 378)”; this way, the Pope would be recognized as supreme over all bishops, and therefore give the church a leader to look up to. And there was one pope in particular, that was a very strong leader: Pope Gregory I, or Gregory the Great.
Environmental scanning involves an organization to look at any trend, opportunity or threat that could create issues for their company. Once any of these issues are identified, the organization should consider new strategies that react to these external factors. Issues should be examined that involve not only direct customers and suppliers, but also competitors, any changes in regulations and possible political involvement. External factors will be constantly changing so environmental scanning should occur frequently and regularly to ensure the current issues have been captured. Research and data analysis can help drive decisions regarding overall marketing changes that might be necessary.
Demand is being forecasted to grow at an annual rate of 20% for the next 3 years.
Many Americans spent their new disposable income on the automobile, which was one of the most significant innovations of the decade. It helped further stimulate the American economy while also improving transportation. Whereas only the wealthy and elite owned automobile prior to this decade, the advent of mass production made the automobile accessible to everyone. Mass production made it much easier and faster to make automobiles,
Environmental scanning can be viewed as a way of acquiring information about outside events that can aid organizations in first identifying potential trends, then interpreting them
While there are expectations of a yearly gain of nearly 2.3 million net new jobs, the unemployment rate is still very high i.e. around 6.5 percent. The lower-than-expected job growth is fueled by various factors including government hiring, weather, and Obamacare. Actually, similar to December, January had a lower-than expected increase in job opportunities since only 113,000 jobs were created. However, the rate of unemployment still reduced to 6.6 percent in this month despite of the growth in labor force. The current rate of unemployment is the lowest in U.S. since the 2008 recession because more people are leaving the labor force instead of finding jobs.
MPC's sales outside the United States now approached 40% of the total, two-thirds of which took
Environmental analysis is important for a company. This allows for the company to look at external factors that will help them to succeed or fail. Environmental analysis could be internal as well as external. The internal analysis allows the company to look within and analyze the successes and see where improvement can and should be made. The external analysis looks at factors such as location, marketing, and surrounding areas to analyze if the these factors are what is best for the company.
Environmental scan in essence analyzes and evaluates the internal as well as external data and factors that influence the organization. Environmental scan entails the acknowledgment of a company’s environment that has potential effect on the organization’s operations and consequently, is critical in devising and implementing successful strategies. Apple Inc. is a leading international company that specializes in the production of computer software, commercial servers and consumer electronics. Its key products include iPhones, iPad, iPod and Mackintosh computers. The company has been in operation for the past 36 years.