Understanding the market place

After studying this chapter, you should be able to: Define and explain the market environment Explain the environmental factors of the market environment Define and explain marketing information system Explain marketing information needs, developing marketing information and information distribution

A market place can be defined as sharing of particular needs or wants by potential buyers who might be willing to engage in exchange to satisfy needs or wants. Market size depends on number of people that exhibit the need, possess the resources to engage in exchange and have the willingness to exchange resources for what they possess.

These include factors that may influence the organization either directly or indirectly in any observable manner. In general, environmental factors affect organization originate from two sides-inputs and outputs. Inputs in an organization include, people with values, needs and focus, goal for affiliation with organization, resources and technology in form of equipment and products.

The organization process these inputs that give rise to output that further go back into the environment. These affect the organization as the output is consumed. It is for this reason organization and environment cannot be separated each exerting influence on the other.

These are external forces that are threat to the organization. The analysis helps to determine the organizational opportunities and danger there by tracing the sources. The marketing environment surrounds and exerts impacts on the organization from three major perspectives: Micro, Macro and internal environments.

Micro-environment describes the relationships between organization and the driving forces that control the relationships. Supplier, customer, intermediaries, employees, creditors and shareholders constitute the micro environment. The relationship is local and the organization may exercise a degree of influence.

All factors that influence organization which are out of direct control of the organization. Organizations generally have no influence on any of such forces- socio-cultural, competition, economic, ecological, political and technological. They continuously changing and the organization needs to be flexible to adapt.

Referred to all factors that are internal to the organization. The internal environment, like the external important for managing change.
Generally assess by applying personnel, money, machinery, materials and markets.

Process that consists of people, equipment and procedure to gather, sort, analyze, evaluate and distribute needed, timely and accurate information to the marketing decision makers. Managing of marketing information normally begins and ends with marketing managers

 Therefore, it: Interacts with information users to assess information Develops needed information from internal and external sources of company data Helps users analyze information for marketing decisions Distributes the marketing information and helps managers use it for a better decision making.

Marketing Information System (MIS) helps managers to: Information Needs Assessment: Strives to balance the information that the managers would like to have contrary to what they really need and what is reasonable to offer. Developing Marketing Information: Marketing managers can obtain essential information from some sources such as

Internal Records (Data): customer databases, financial records, and operation reports. Marketing Intelligence: Systematic collection and analysis of publicly available information about competitors and pattern in the marketing environment. E.g. Company employees, Internet, Garbage, Published information, Competitors employees, Trade shows, Benchmarking, Channel members and key customers Marketing research: Involves a systematic design, collection, analysis, and reporting of data relevant to a specific marketing situation facing an organization.

Marketing research: Defining the problem and research objectives Developing the research plan for collecting information Implementation of the research plan through collecting and analyzing the data. Interpreting and reporting the research findings

Information gathered through the required process ought to be distributed to the appropriate people (marketing managers) and at right time. The development in information technology has changed the pattern of information distribution. The distribution and using marketing information should take the form of routine activity that makes information available in a timely manner.

Reference Brine Gary (2007) Marketing Magazine, November 2007 - December 2007 Boone and Kurtz (2006) Contemporary Marketing 2006, Thomson, south western Kotler, Philip and Armstrong, Gary (2004) Principles of Marketing Khatibi, Ali Mohan, Avvari V. and Haque, Ahasanul (2005) Principles of Marketing, Thomson