Major Societal Forces

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Major Societal Forces
Network information technology. The digital revolution has created an Information Age that promises to lead to more accurate levels of production, more targeted communications, and more relevant pricing.

•Globalization. Technological advances in transportation,shipping,and communication have made it easier for companies to market in, and consumers to buy from, almost any country in the world. International travel has continued to grow as more people work and play in other countries.

•Deregulation. Many countries have deregulated industries to create greater competition and growth opportunities. In the United States, laws restricting financial services, telecommunications, and electric utilities have all been loosened in the spirit of greater competition.

•Privatization. Many countries have converted public companies to private ownership and management to increase their efficiency,such as the massive telecom company Telefónica CTC in Chile • Heightened competition. Intense competition among domestic and foreign brands raises marketing costs and shrinks profit margins.Brand manufacturers are further buffeted by pow- erful retailers that market their own store brands. Many strong brands have become megabrands and extended into a wide variety of related product categories, presenting a sig- nificant competitive threat.

• Industry convergence. Industry boundaries are blurring as companies recognize new opportunities at the intersection of two or more industries. The computing and consumer electronics industries are converging, for example, as Apple, Sony, and Samsung release a stream of entertainment devices from MP3 players to plasma TVs and camcorders. Digital technology fuels this massive convergence.

•Retail transformation. Store-based retailers face competition from catalog houses; direct- mail firms; newspaper, magazine, and TV direct-to-customer ads; home shopping TV; and e-commerce. In response, entrepreneurial retailers are...