Page 104 - Marketing Management

COLLECTING INFORMATION AND FORECASTING DEMAND | CHAPTER 3 81

Actor and environmental activist
Ed Begley Jr. examines a solar
oven.

• Due to millions of rural cooking fires, parts of Southern Asia suffer extremely poor
air quality. A person cooking over an open wood or kerosene fire inhales the equivalent
of two packs of cigarettes a day. Illinois-based Sun Ovens International makes family-sized
and institutional solar ovens that use mirrors to redirect the sun’s rays into an
insulated box. Used in 130 countries, the oven both saves money and reduces greenhouse
gas emissions.
Corporate environmentalism recognizes the need to integrate environmental issues into the
firm’s strategic plans. Trends in the natural environment for marketers to be aware of include the
shortage of raw materials, especially water; the increased cost of energy; increased pollution levels;
and the changing role of governments. (See also “Marketing Insight: The Green Marketing
Revolution.”) 47

• The earth’s raw materials consist of the infinite, the finite renewable, and the finite nonre-
newable. Firms whose products require finite nonrenewable resources—oil, coal, platinum,
zinc, silver—face substantial cost increases as depletion approaches. Firms that can develop
substitute materials have an excellent opportunity.
• One finite nonrenewable resource, oil, has created serious problems for the world economy. As
oil prices soar, companies search for practical means to harness solar, nuclear, wind, and other
alternative energies.
• Some industrial activity will inevitably damage the natural environment, creating a large market
for pollution-control solutions such as scrubbers, recycling centers, and landfill systems as well as
for alternative ways to produce and package goods.
• Many poor nations are doing little about pollution, lacking the funds or the political will. It is
in the richer nations’ interest to help them control their pollution, but even richer nations
today lack the necessary funds.

The Technological Environment
It is the essence of market capitalism to be dynamic and tolerate the creative destructiveness of
technology as the price of progress. Transistors hurt the vacuum-tube industry, and autos hurt the
railroads. Television hurt the newspapers, and the Internet hurt them both.
When old industries fight or ignore new technologies, their businesses decline. Tower Records
had ample warning that its music retail business would be hurt by Internet downloads of music (as
well as the growing number of discount music retailers). Its failure to respond led to the liquidation
of all its domestic physical stores in 2006.