Marketing Enviroment

Marketing Enviroment

1. Marketing Environment is the combination of external and internal factors and forces which affect the company’s ability to establish a relationship and serve its customers.

2. The internal environment is company specific and includes owners, workers, machines, materials etc.

3. The external environment: constitutes factors and forces which are external to the business and on which the marketer has little or no control.

   • The micro component: of the external environment is also known as the task environment. It comprises of external forces and factors that are directly related to the business. These include suppliers, market intermediaries, customers, partners, competitors and the public
     • Suppliers: include all the parties which provide resources needed by the organisation.
       • Compliance with local laws: Suppliers should comply with all relevant laws and standards, including human rights protection and child labor.
       • Equitable transactions from all retailers: Suppliers must provide equal opportunities for all retailers to do business with them.
       • Best price possible: Suppliers must guarantee the best price and quality to retailers to maintain trust among them.
       • No conflict of interest for suppliers: Suppliers should not do business with those who they may have a conflict of interest with. This would include family members, friends, and new or old colleagues.
     • Market intermediaries: include parties involved in distributing the product or service of the organisation.
       • Agents and Brokers
       • Merchant Wholesalers and Resellers
       • Distributors and Functional Wholesalers
       • Traditional and Online Retailers
     • Partners: are all the separate entities like advertising agencies, market research organisations, banking and insurance companies, transportation companies, brokers, etc. which conduct business with the organisation.
       • Active Partner/Managing: He carries on the daily business on behalf of all the partners.
       • Dormant/Sleeping Partner: He is however bound by the action of all the other partners.
       • Nominal Partner: This is a partner that does not have any real or significant interest in the partnership. So, in essence, he is only lending his name to the partnership.
       • Partner in Profits Only This partner will only share the profits of the firm, he will not be liable for any liabilities.
     • Customers: comprise of the target group of the organisation.
       • Loyal Customers- These types of customers are less in numbers but promote more sales and profit as compared to other customers as these are the ones which are completely satisfied.
       • Discount Customers- Discount customers are also frequent visitors but they are only a part of business when offered with discounts on regular products and brands or they buy only low cost products.
       • Impulsive Customers- These customers are difficult to convince as they want to do the business in urge or caprice. They don’t have any specific item into their product list but urge to buy what they find good and productive at that point of time.
       • Need Based Customers- These customers are product specific and only tend to buy items only to which they are habitual or have a specific need for them.
       • Wandering Customers- These are the least profitable customers as sometimes they themselves are not sure what to buy.
     • Competitors: are the players in the same market who targets similar customers as that of the organisation.
       • Direct: A firm that sells the same products and services as you in the same markets.
       • Indirect: A firm that sells different categories of products and services but are in the same industry and same markets.
       • Replacement A firm that sells products and services that are in a different industry that could be used as a substitute for your products.
     • Public: is made up of any other group that has an actual or potential interest or affects the company’s ability to serve its customers.
       • Financial: influences the companys ability to obtain funds
       • Media: Carries news, features and editorial opinion.
       • Goverment: Managment must take goverment developments into account.
       • Citizen-action: Help the company stay in touch with customer and citizen groups.
       • Local: This group includes neighborhood residents and community organizations
       • General: A company needs to be concerned about the general publics attitude to ward its products and activities.
       • Internal: Include workers, managers, volunteers, and the board of directors
   • The macro enviroment constitutes the external factors and forces which affect the industry as a whole but don’t have a direct effect on the business.
     • Demographic Environment The demographic environment is made up of the people who constitute the market.
     • Economic Environment The economic environment constitutes factors which influence customers’ purchasing power and spending patterns.
     • Physical Environment The physical environment includes the natural environment in which the business operates.
     • Technological Environment The technological environment constitutes innovation, research and development in technology, technological alternatives, innovation inducements also technological barriers to smooth operation.
     • Political-Legal Environment The political & Legal environment includes laws and government’s policies prevailing in the country.
     • Social-Cultural Environment The social-cultural aspect of the macro environment is made up of the lifestyle, values, culture, prejudice and beliefs of the people.