Marketing Environment

Presented byProf. Ashish Bhalla

Marketing Environment

The forces that directly and indirectly influence an organization’s capability to undertake its business.

The trading forces operating in a market place over which a business has no direct control ,but which shape the manner in which the business function and is able to satisfy its customers.

Factor Affecting Marketing Environment

Includes:

Micro environment - forces close to the company that affect its ability to serve its customers.

Macro environment - larger societal forces that affect the whole microenvironment.

Company

Suppliers

Marketing Intermediaries

Customers

Publics

Competitors

Company

Microenvironment Internal Forces

Company

Marketing must consider other parts of the organization including finance, R&D, purchasing, operations and accounting.

Marketing decisions must relate to broader company goals and strategies

Suppliers Suppliers are either individuals or business houses.

They provide resources needed by the company .

The developments in the suppliers environment have a substantial impact on the marketing operations of the company .

Companies can lower their supply costs and increase product quality to gain competitive advantage in the market.

Supply shortages have to be fully monitored and plans should be made to avoid it.

Market Intermediates

They are either business houses or individuals . They help the company in promoting, selling and distributing the goods to customers.

They are middlemen, distributing agencies, market service agencies and financial institutions.

Customers

The target market of the company is usually of five types:

1.Consumer market i.e. individual and householders.

2.Industrial market i.e. organizations buying for producing other Goods and services.

3.Reseller market i.e. organizations buying goods and services with a view to sell them to others.

4.Government and other non profit markets.i.e.those buying goods and services in order to produce public services.

5.International market i.e. individuals and organizations of nations other then home land who buy for either consumption or industrial use.

Competitors

No company stands alone in serving and satisfying the needs of a customer market. It faces competition.

This helps the company in facing a host of competitors with confidence

The company in order to come out successfully has to adopt means which may help it to outmaneuver.

The competitive environment consists of certain basic things which every marketing manager has to take note of.

Philip Kotler ‘the best way for a company to grasp the full range of its competition is to take view point of a buyer.”

Public

Public is defined as ‘any group that has an actual or potential interest in or impact on a company’s ability to achieve it’s objective.

The actions of the company do affect the interest of other groups i.e., those who form general public for the company who must be satisfied along with the consumers of the company.

According to Kotler ‘companies must put their primary energy into effectively managing their relationships with their customers.

Demographic

Economic

Natural Technological

Political

Cultural

Company

Macro environment(External Forces)

Demographic Environment

Demographic data helps in preparing geographical marketing plans, household marketing plans, age and sex wise plans.

It influences behavior of consumers which in turn will have direct impact on market place.

A marketer must communicate with consumers anticipate problems ,respond to complaints and make sure that the firm operates properly.

Economic Environment

The economic environment consists of factors that affect consumers purchasing and spending power. Under economic environment manager generally studies

1.trends of gross national product

2.patterns of real growth in income

3.variations in geographical income distribution.

4.borrowing pattern ,trends and governmental and legal restrictions.

5.major economic variables

Changesin Consumer

SpendingPatterns

Changesin Consumer

SpendingPatterns

EconomicDevelopment

EconomicDevelopment

Changes in Income

Changes in IncomeKey

EconomicConcerns for

Marketers

KeyEconomic

Concerns forMarketers

Economic Environment

Natural Environment

Involves the natural resources that are needed as inputs by marketers or that are affected by marketing activities.

Natural Environment Trends

Shortage of raw materials.Limited quantities of non-renewable resources.

Increased pollution.Waste disposal, air/water pollutants.

Increased government intervention.Kyoto and other initiatives.

Environmentally sustainable strategies.G.R.E.E.N. movement.

Factors Affecting

the Natural

Environment

More GovernmentIntervention

More GovernmentIntervention

Shortages of Raw Material

Shortages of Raw Material

Increased Costsof Energy

Increased Costsof Energy

Higher PollutionLevels

Higher PollutionLevels

Natural Environment

Technological Environment Most dramatic force now shaping our destiny.

Changes rapidly.

Creates new markets and opportunities.

Challenge is to make practical, affordable products.

Safety regulations result in higher research costs and longer time between conceptualization and introduction of product.

Rapid Pace of Change

Rapid Pace of Change

High R & D Budgets

High R & D Budgets

Focus on MinorImprovements

Focus on MinorImprovements

IncreasedRegulation

IncreasedRegulation

Issues in the TechnologicalEnvironment

Issues in the TechnologicalEnvironment

Technological Environment

Political and Legal Environment

Includes laws, government agencies and pressure groups that influence or limit various organizations and individuals in a given society.

• Increasing legislation.• Changing government agency enforcement.• More emphasis on ethics and socially responsible

actions.

GreaterConcern for

Ethics

GreaterConcern for

Ethics

IncreasedLegislation

IncreasedLegislation

Changing Enforcement

Changing EnforcementKey

Trends in thePolitical

Environment

KeyTrends in the

PoliticalEnvironment

Political and Legal Environment

Social and Cultural Environment

Social responsibility has crept into the marketing literature as an alternative to the market concept.

Socially responsible marketing is that business firms should take the lead in eliminating socially harmful products

OfOrganizations

OfNature

OfOneself

OfSociety

Ofthe Universe

OfOthersViews

That ExpressValues

ViewsThat Express

Values

Social and Cultural Environment

Thank You