MARKETING ENVIRONMENTCHAPTER – 2

Principles of Marketing – Outcome 1 – Chapter 2

Marketing Environment

The forces outside marketing that affect marketing management’s ability to build and maintain successful relationships with target customers.

Microenvironment: - The factors close to the company that affect its ability to serve its customers.

Marco environment: - The larger societal forces that affect the microenvironment.

Microenvironment

1. The Company 2. Suppliers 3. Marketing Intermediaries 4. Customers 5. Competitors 6. Public

Microenvironment

The Company – For designing marketing plans marketing management takes other company groups in to account, such as top management, research and development, purchasing and accounts.

Microenvironment

Suppliers – Suppliers form an important link in the company’s overall customer value delivery. They provide resources needed by the company to produce its goods and services.

Microenvironment Marketing intermediaries – They are

firms that help companies to promote, sell and distribute its goods to final buyers. They include resellers, marketing services agencies and financial intermediaries.

Microenvironment

Customers – There are mainly five types of customers: Consumer Markets - Includes individuals and

households for personal consumption.

Customers

Business market - They buy goods and services for further production.

Customers

Reseller Market - They buy goods and services to resell at a profit.

Customers

Government market - They buy goods and services to produce public service and transfer goods to them who are in need of them.

International Market - Includes customers from all kind of markets buying from other countries.

Microenvironment

Competitors - Other companies who sell same kind of products and services in market. So here our company has to give greater customer value and satisfaction than the competitors.

Microenvironment

Public - Any group that has an actual interest in organizations ability to achieve its objectives: Financial Public – From where company

can get funds. Media public- Includes newspapers,

magazines, TV etc. Local public- They include neighbourhood

residents and community organizations. General public- The public’s image of the

company affects its buying.

Marco environment

1. Demographic Environment 2. Economic Environment 3. Technological Environment 4. Political Environment 5. Cultural Environment 6. Natural Environment

Marco environment - Demographic Environment

Demographic environment: Refers to studying human populations in terms of size, density, location, age, gender, race, and occupation.

This is a very important factor to study for marketers and helps to divide the population into market segments and target markets.

Marco environment - Economic Environment

Economic environment: It includes the structure and nature of economy, the stage of development of the

economy, economic resources, the level of income, the distribution of income and assets, global economic linkages, economic

policies etc.

Marco environment - Technological Environment

Technological environment: The state of technology achieved by a society is a fundamental influence on what goods are produced, how they are produced, and how production are organized and managed.

Technology is the application of scientific principles to provide society with things needed or desired.

Marco environment - Political Environment

Political environment: The political and legal environment

comprises the background of laws and regulations within which the organizations operate.

The common political issues that influence the manager's decisions which affect the business are:

Marco environment - Political Environment

Peace and order situations Political system and ideology Political flat- forms and investment

programs Changes in tax rates Legislations on labour and consumer

protection

Marco environment - Cultural environment

Business cannot operate in isolation from a society because they are part of that society.

Indeed, any business is itself a form of social organization.

Companies must recognize and respect social values, ideas of status, decision making habits, attitude towards time, use of space, body language, manners and ethical standards.

Otherwise may lead to cultural differences. Culture is the society's norm of values and beliefs.

Marco environment – Natural Environment

Natural environment: It includes natural resources, weather,

climatic conditions, port facilities, topographical factors such as soil, sea, rivers, rainfall etc.

Every business unit must look for these factors before choosing the location for their business.