Macro-Environmental Analysis for Marketing

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The “Vital Foods” Yoghurt Company was established in 1995 by two farmers who wanted to create wholesome, natural, organic and nutritiously delicious yoghurt for the active and time poor. Founded on the dairy plains of Victoria, “Vital Foods” is fast becoming one the premier yoghurt manufacturers and have asked that their new product be marketed correctly.

As each type of product has its own target market, we must ensure that this market is properly researched, analysed and have an appropriate strategy to implement. A market by definition and be surmised at being “the set of all actual and potential buyers of a product” (Kotler, 1998). The yoghurt market consists of all the actual and potential buyers of yoghurt products.

The macro-environment consists of six types of forces economic, demographic, cultural, natural, technological and political. “Vital Foods” must ensure that they take into account the trends, changes and alterations in these environments which can both pose threats and reveal opportunities.

Economic Environment

The economic environment is best described as having the “factors that affect consumer buying power and spending patterns" (Kotler et al 1998). These factors include income, levels of employment, inflation, value of the Australian dollar, monetary policy and many others.

This environment is a major aspect of the macro-environment as any consumer who wishes to act on their desires must be able to have the purchasing power to initiate the transaction.

The level of disposable income of Australians is another key point. As the level of disposable income increases, consumers are more likely to purchase a high quality product than more of the same. This does work inversely as well; as income drops the consumer is more likely to purchase lower quality products.

In today economic environment, the median wage for Australians has risen by 2.9% per year over 2006-2007 (ABS 2007). However, this rise in median income has been negated by decrease in the actual wealth of the people of Australia. Economic factors such as high interest rates and increases in the consumer price index have lead many consumers to the discount and lower quality versions of their regular products.

For “Vital Foods” to capitalise on these trends, it could be suggested that they aim their product towards the price conservative consumers who may shop at the discount supermarket chains. As well as this, “Vital Foods” may decide to create a sense of bulk buying options into their product with savings attached to buying bigger portions.

Demographic Environment

As defined by Kolter et al, demographics are the "study of human populations in terms of size, density, location, age, sex, race, occupations and other statistics" (Kotler, 1998). The demographic environment consists of the above variables and their ability to affect the Australian yoghurt market. The importance this environment is situated in the fact that all demand for products or services ultimately derives from people (Cannon 1998).

Recent demographic trends are showing that Australia is becoming a better-educated population and is increasing the number of those in white-collar professions. In Kotler et al, it is noted that recent times have “transformed the Australian marketplace from a mass market into more fragmented micro-markets differentiated by age, sex, geography, lifestyle, ethnic background, education and other factors." The implications of this to “Vital Foods” is that they must alter their product and marketing strategies to suit the audience that they wish to target.

As each of the variables has the potential to affect the yoghurt product on the Australian market, there is a particular point of focus that “Vital Foods” and centre on. Using the recent spotlight of Australia’s obesity problem, with 26% off all Australians being obese (Australian, 2008), “Vital Foods” can concentrate on aiming their product towards the diet market,...
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