Running Head: ENVIRONMENTAL FACTORS 1

Environmental Factors

Edward Charfauros

Marketing MKT/421

April 24, 2012

Shane Akagi

ENVIRONMENTAL FACTORS 2

Environmental Factors

Environmental factors may hinder organization’s success when organizations attempt

marketing products and services. Global, governmental, and technological factors can build and

destroy successful organizations within the United States as failures upon foreign markets.

Marketing managers require care when strategically determining when global markets benefit an

organization. Thorough research and development assist organizations in determining whether

to enter financially into the international marketplace or not. Target successfully triumphs within

the retail market within the United States through a marketing campaign of innovation.

Political System Affects and International Relation Influences

Target’s marketing campaign increases its capital, acquires components, obtains

materials, manufacturers products, and distributes its goods where consumers inquire it. Upon

exporting to foreign nations, organizations deal with trade restrictions during negotiations.

Foreign national governments charge tariffs and tax specific import products design for raising

revenue to protect domestic businesses. Furthermore, American businesses deal with exchange

controls limiting foreign exchange amounts and the exchange rate versus foreign currencies.

Organizations may deal with nontariff trade barriers (biases) against the United States

business bids, regulations, and restrictive product standards. These regulations protect

consumers, international, local, and business organizations from buyers, logistic affiliates, and

merchants alike. Target continues proving its corporate responsibility through its continual

charitable donations and environmental friendly practices.

According to the corporate responsibility report upon Target’s corporate website (2012),

“in addition to our U.S. retail operations, we have offices in over 40 countries throughout the

world to support our global sourcing initiatives” (investors section, p. 1, para. 1). For example,

ENVIRONMENTAL FACTORS 3

Target continues thriving in India by expanding operations with a third store with intentions on

expanding operations in Canada in 2013. According to Target’s India website (2012), “in India,

we have awarded grants to several nongovernmental organizations (NGOs), including Christel

House India, SOS Children's Village of India, Makkala Jagriti, the Karnataka branch of the

National Association for the Blind, SMILE Foundation, and Child Survival (serving

communities section, para. 1). Target currently employs 355,000-plus team members around the

world.

Demographic Importance

Managers must be sensitive to audiences when addressing any demographic. Societies

continue influencing marketing decisions within households. Marketing managers take

responsibility and appropriate actions when marketing products because marketing influences

consumers. Target’s initiatives remain sensitive toward communities, schools, and homes

reflecting a strong indication of bettering cities.

Physical Infrastructure

After the first Target store opening in Roseville, Minnesota, provides customers with

commodities, groceries, and apparel. Target engages its customer’s shopping experience by

reinventing its stores (layout, merchandise assortment, and presentation) through renovation.

With attractive stores offering merchandise to meet current trends at affordable prices Target

meets or exceeds consumer discount shopping expectations.

Assisting Target’s brand promise is reliable cost-effective technology: Microsoft’s

windows server 2008 datacenter and hyper-v virtualization technology. Target’s store server

infrastructure supports 15,000 virtual machines throughout its corporate infrastructure operating

mission essential software applications.

ENVIRONMENTAL FACTORS 4

Foreign Corrupt Practices Act of 1977 Influences

According to the United States Department of Justice website under fraud section (2012),

“the Foreign Corrupt Practices Act of 1977, as amended, 15 U.S.C. §§ 78dd-1, et seq. ("FCPA"),

was enacted for the purpose of making it unlawful for certain classes of persons and entities to

make payments to foreign government officials to assist in obtaining or retaining business”

(foreign corrupt practices act section, para. 1).

The FCPA requires issuers to register with the Securities and Exchange Commission

(SEC) to responsibly maintain an internal accounting control system. Furthermore, the FCPA

prohibits briberies from foreign officials and American corporations. Official third parties

handle organizations attempting to proceed around the FCPA law. When organizations proceed

globally, challenges such as bribery arise during expansion as it remains a corporate issue.

Other nations adopt similar laws and regulations like the FCPA. Laws are in place for

security against unethical and unfair business practices. Target upholds its socio-economic

responsibility while conducting its business within every community in a respectable manner.

Local, National, and International Legislation Influence

Comprehending both ethical and social aspects while identifying with target audiences

and markets can be complex. Consumerism is an organization movement consisting of

government agencies and citizens improving buyer’s rights and power. Environmentalism is an

organization movement concerning government agencies and citizens improving and protecting

people’s living environment. These groups protect the rights of the public through product

education, consumer services, and environmental care operations.

Influence of Global Economic Interdependence and Effect of Trade Practices and

Agreements

ENVIRONMENTAL FACTORS 5

Executives and managers upon every level do not require dealing with legal uncertainties,

language barriers, varying politics, government regulations, and unstable currencies. However,

Target considers its strategic positions within the marketplace as strong on a national (rank

second behind Walmart in discount retailing) and international (fourth most-visited website

worldwide with 25,000,000 unique visitors) basis. Marketers continue learning about global

populations by researching the continual changing mixture of age groups, ethnicities,

geographical shifts, and nontraditional family education. Global competitors contend against

Target’s home markets through product offerings and lower prices. Moreover, local

organizations slow resources requiring one organization to operate because of Target’s size.

When organizations go international, evaluating nation’s economic conditions, country

environments, international political standpoint, and government regulations with the United

States is vital prior to expanding operations. Target requires weighing various risks prior to

venturing abroad.

Influences of Cultural Differences

Products and services become successful in nations by marketers comprehending

targeting audiences and markets. Sellers require fully comprehending buyer behaviors, cultures,

cultural differences, and norms. Comprehending cultural nuances remains Target’s advantage

during product positioning and international marketing mix development. Marketing throughout

nations and its cultures requires understanding cultural differences. Lacking knowledge about

any society Target enters results in failing to thrive within the nation. Additional factors for

consideration are availability, business cycles, cost of goods, and taxes versus a nation’s

disposable income.

Social Responsibility Importance and Ethics Versus Legal Obligations.

ENVIRONMENTAL FACTORS 6

Marketing in society shapes decisions within majority of households. Marketers are

responsible during marketing campaigns when marketing products. Target assesses its global

ability politically and societally when handling its business affairs. Target must remain sensitive

and flexible to its ethical and social business aspects when continuing business with customers

because Target influences households. Considering an ethical obligation remains constant.

Target prides itself through employee diversity and its community outreach programs

worldwide encouraging opportunities through its corporate responsibilities. With practices in

place, Target ideally places itself within cities (rural and urban areas). So long as the nation,

cities, and internal infrastructure remains adequate for products through logistics. Target

continues its positive effects upon neighborhoods. Target inquires additional information

regarding exporting and importing when concerning trade agreements.

Ethics continues increasing within organizations upon dealing with ethical marketing

issues. Marketers must comprehend audiences, product markets, and societies keeping in line

with society’s values and subcultures. Additionally health care and employment laws continue

affecting Target and its employees. Legal and political environments consist of challenging

groups, governmental agencies, and laws influencing and limiting individuals and various

organizations. These laws ensure businesses protect consumer’s interests upon unacceptable

business behavior.

Effects of Technology

Technology implications have downfalls and successes. Target’s operations and its retail

locations thrive in its technological efforts. Target provides products online beyond its physical

locations even though Target requires nations to conduct business at a functional level to meet

Target’s needs.

ENVIRONMENTAL FACTORS 7

Target manages 300,000 plus endpoints throughout its retail network by deploying the

Microsoft System Center data center. With the Microsoft Virtualization solution, Target saves

millions of dollars in maintenance, hardware, and electrical costs.

Conclusion

Conducting business globally requires extensive research, as an analysis within the

organization must be done. Many factors exist (internally and externally) requiring

consideration through a strengths, weaknesses/limitations, opportunities, and threats analysis.

Through a strengths, weaknesses/limitations, opportunities, and threats analysis Target

determines if its strong enough to expand, and through a political, economic, social, and

technological analysis determines if specific nation’s external environmental factors affect

Target’s success within that chosen nation.

Comprehending customer’s buying behaviors remain essential within marketing.

Adherence to environmental laws enhances Target’s business. When focusing on target

customers, Target can focus on its brand to strengthen its market share to satisfy shareholders.

Evaluating its external factors after comprehension prior to decision-making remains

important before commencing global operations. Through extensive research, development, and

comprehension of various consumer behaviors, Target’s success will continue.

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References

Target. (2012). Corporate responsibility report . Retrieved from

http://investors.target.com/phoenix.zhtml?c=65828&p=irol-IRHome

Target. (2012). About target. Retrieved from http://india.target.com/site/en/corporate/page.jsp?

contentId=PRD03-004529

United States Department of Justice. (2012). The foreign corrupt practices act. Retrieved from

http://www.justice.gov/criminal/fraud/fcpa/