MARKETING ENVIRONMENT

Importance Develop broad strategies and long term policies. Analyze competitor's strategies and formulate effective counter strategies.

Knowledge about changing environment will keep

the organisation dynamic in approach.

Adjust to the prevailing condition of the

environment.

Marketing Environment

All the external factors and forces that affect a firms ability to develop and maintain successful transactions and relationships with the target customers.
It brings opportunities or threats to the firm.
Marketing Environment External environment. Internal environment.

Internal Environment Controllable factors Organization modify or alter the factors to suit the environment.

Internal environment consists mainly the marketing mix

Organizational recourses, R & D , Finance, Marketing and Operational capabilities.

External Environment
(uncontrollable factors)

Micro Environment

Macro Environment

1. 2. 3. 4. 5.

Suppliers Customers Intermediaries Competitors Public

1. Demographic 2. Economic 3. Natural/ Physical 4. Technological 5. Politico- legal 6. Socio-cultural

1. Demographic Environment
Level of population growth, age ,sex, education patterns, family influences and shifts. 2. Economic Environment factors
Economic conditions Economic Systems

Economic Policies 1.Free Market Economic Systems 2.Centrally Planned Economies 3.Mixed Economies

3.Natural Environment Modern technology in industry may cause a rapid deterioration of the physical environment ie air pollution, water pollution, noise pollution etc. Assessed by biologist, ecologist, sociologist and conservationists. Consider physical environmental factors quality and quantity of existing forest wealth, possibility rain, the exploitation of sea products, the health hazards out of pollution.

4. Political/ Legal Environment Political system in the country decides, promotes and controls business activities. Pass legislation on matters as wages and prices, employment opportunities, safety and health at work, location, what the plant can emit into the air, how much noise etc.

5.Tecnological Environment
Changes affects the production methods, processes and consumption of raw materials for the manufacture of product. Affects more for volatile industries than, stable industries. 6.Social and Cultural Environment Encompasses the economic, political, legal and technological factors.

Socio-cultural customs and beliefs of the people shape the economy, the political legal system and technology. Affects the strategies of the organization. Culture determines, the type of goods and services a business should produce. Environmental Scanning Organizations assemble a team of specialists to continually collect and evaluate environmental information.

 Goal is to identify future market opportunities and threats. Competitor moves can be anticipated and countered.

Marketer is able to know the organizational strengths, capabilities and related opportunities.
Can easily adapt to the uncontrollable environment.