Page 98 - Marketing Management

COLLECTING INFORMATION AND FORECASTING DEMAND | CHAPTER 3 75

The Demographic Environment

Demographic developments often move at a fairly predictable pace. The main one marketers
monitor is population, including the size and growth rate of population in cities, regions, and
nations; age distribution and ethnic mix; educational levels; household patterns; and regional
characteristics and movements.
WORLDWIDE POPULATION GROWTH World population growth is explosive: Earth’s
population totaled 6.8 billion in 2010 and will exceed 9 billion by 2040. 25 Table 3.3 offers an
interesting perspective. 26
Population growth is highest in countries and communities that can least afford it. Developing
regions of the world currently account for 84 percent of the world population and are growing at 1 per-
27
cent to 2 percent per year; the population in developed countries is growing at only 0.3 percent. In de-
veloping countries, modern medicine is lowering the death rate, but the birthrate remains fairly stable.
A growing population does not mean growing markets unless there is sufficient purchasing power.
Care and education of children can raise the standard of living but are nearly impossible to accom-
plish in most developing countries. Nonetheless, companies that carefully analyze these markets can
find major opportunities. Sometimes the lessons from developing markets are helping businesses in
developed markets. See “Marketing Insight: Finding Gold at the Bottom of the Pyramid.”

POPULATION AGE MIX Mexico has a very young population and rapid population growth.
At the other extreme is Italy, with one of the world’s oldest populations. Milk, diapers, school
supplies, and toys will be more important products in Mexico than in Italy.
There is a global trend toward an aging population. In 1950, there were only 131 million people 65
and older; in 1995, their number had almost tripled to 371 million. By 2050, one of ten people world-
wide will be 65 or older. In the United States, boomers—those born between 1946 and 1964—represent
a market of some 36 million, about 12 percent of the population. By 2011, the 65-and-over population
will be growing faster than the population as a whole in each of the 50 states. 28
Marketers generally divide the population into six age groups: preschool children, school-age
children, teens, young adults age 20 to 40, middle-aged adults 40 to 65, and older adults 65 and

TABLE 3.3 The World as a Village

If the world were a village of 100 people:
• 61 villagers would be Asian (of that, 20 would be Chinese and 17 would be Indian), 14 would be
African, 11 would be European, 8 would be Latin or South American, 5 would be North American,
and only one of the villagers would be from Australia, Oceania, or Antarctica.
• At least 18 villagers would be unable to read or write but 33 would have cellular phones and
16 would be online on the Internet.
• 18 villagers would be under 10 years of age and 11 would be over 60 years old. There would be
an equal number of males and females.
• There would be 18 cars in the village.
• 63 villagers would have inadequate sanitation.
• 32 villagers would be Christians, 20 would be Muslims, 14 would be Hindus, 6 would be Buddhists,
16 would be non-religious, and the remaining 12 would be members of other religions.
• 30 villagers would be unemployed or underemployed, while of those 70 who would work, 28 would
work in agriculture (primary sector), 14 would work in industry (secondary sector), and the remain-
ing 28 would work in the service sector (tertiary sector).
• 53 villagers would live on less than two U.S. dollars a day. One villager would have AIDS, 26 villagers
would smoke, and 14 villagers would be obese.
• By the end of a year, one villager would die and two new villagers would be born so the population
would climb to 101.

Source: David J. Smith and Shelagh Armstrong, If the World Were a Village: A Book About the World’s People, 2nd ed. (Tonawanda, NY: Kids Can
Press, 2002).