Marketing Opportunities
Essay Preview: Marketing Opportunities
Report this essay
Driving Skills for Life is a privately owned and operated company based in Brisbane. It is a young and innovative organisation, which aims to provide road safety education to drivers through technological simulation of all aspects of the driving environment. Driving Skills for Life provides an award winning multi-station driving simulator at their inner-city office. The simulator has a capacity for up to 20 people at any one time, and each training session is two hours long in duration. The aim of this analysis is to provide the macro-environment factors that may impact the development of a new Mobile Virtual Reality Driving Simulator which will assist drivers in learning road safety skills without real-life risk.
The six macro-environment factors are demographic, economic, natural, technological, political and cultural. Driving Skills for Life is required to consider the tendencies and evolutions in each of these scenarios, which both may have impact on the opportunities and threats in the development of the new Mobile Virtual Reality Driving Simulation training.
Demographic Environment
As described by Kotler, P., Brown, L., Burton, S., Deans, K.& Armstrong, G., (2010), demographic environment is the study of human populations in terms of size, density, location, age, sex, race, occupations and other statistics. The Australian population has grown 2.1% in the last twelve months which is almost double the average compared to the world population percentage of 1.1%. The overseas migration has been by far the greatest contributor to population growth. All states and territories show a clear growth in the same period of time, Western Australia and Queensland registered the greatest population increase, respectively.
One of the most considerable movements in the worlds demographic characteristics is the ageing population, indicating that the younger population is reducing and the older population is increasing. Australias population is in line with the other developed countries of the world. The trend is that life expectancy is rising and fertility rates decrease, as consequence the younger population reduces accordingly. Therefore, the Australian traditional family model is changing; the Australian Bureau of Statistics is predicting the decrease of the household numbers from 3.31 in 1971 to 2.2 in 2015. The transformation of age composition over the past decades will have an effect on the population growth of the different age brackets (ABS, 2010).
Around 64% of Australians live in capital cities. The highest proportion of this population is between 20 and 39 years old, this displays the desirability of this age bracket to seek education, employment and broader prospects that major cities traditionally offer.
Demographic trends are a significant variable used to segment both customer and business markets. As demographics are directly linked to identifying target markets, observing how demographics alter over time is vital for reaching positive marketing results.
Economic Environment
The economic environment is illustrated as the consistency of the “factors that affect consumer buying power and spending patterns” (Kotler et al., 2010), some of aspects include disposable income, levels of employment, living costs, interest rates, savings, monetary policy and many other factors due to world globalisation. It is considered a critical element as any buyer who wishes to act on their needs must possess the purchasing power to commence the transaction.
The average wage in Australian continues to rise each year. In 2007-08 financial year, the mean disposable household income for all individuals living in private dwellings was $811 per week and there were approximately 20.6 million people living in private dwellings (ABS 2009). As a direct result of the global financial crises the mean disposable income may have reduced significantly for these households. However, as the unemployment rate is reducing after its peak of 5.9% in August 2009, there is a strong indication that the average wage will continue to rise.
The Consumer Price Index (CPI) is another significant indicator. Through the CPI it is possible to check the change to living costs, inflation and the resulting confidence of consumers. The CPI in Australia has increased to almost 3% in the last twelve months, education, health and housing are the main contributors to this increase. Clothing and footwear reflected a CPI figure of -1.8% which shows that consumers are not willing to spend savings on non-essential items.
Major fluctuations in the economic settings will have a major effect on the marketplace. Forecasting is an excellent tool that should be used by companies to predict and formalise quick reactions to economic needs.
Natural Environment
The natural environment involves all the natural resources, such as raw materials, energy sources and/or pollution, which are needed by or affected by marketers and marketing activities (Kotler, P., Armstrong, G., Meggs, D., Bradbury, E., & Grech J., 1999). Recently, the global population became aware of the obligation to protect and respect our ecosystem, and it involves the very important task of protecting our natural world and resources from all the destructive effects of industrialisation. Furthermore, customers are more inclined not to purchase goods and services which during the manufacturing phase or via its use may cause damage to the environment. Nowadays, companies must adopt sound environmental strategies in order to safeguard market share and a positive image.
The ongoing global shortages of vital raw materials, especially non-renewable resources, are raising prices to its peak. This will influence the increase of energy costs. In Australia, the cost of electricity has been estimated to increase by almost 15% from July 2010; this will make more consumers and manufactures adopt alternative energy resources such as solar power and wind power.
Organisations and consumers are more conscious of the pollution caused by industrial plants that are deteriorating the natural wonders of the world for example the Great Barrier Reef. With these concerns more and more people are participating in recycling programs and purchasing more “environmentally friendly” products. Environmental claims have become a powerful marketing tool. Companies are progressively utilising more environmental claims in an effort to distinguish themselves and their products from the competition. These statements come in an extensive range, consisting of statements about environmental sustainability, recycling, energy and water