The marketing environment consists of internal and external factors that affect a company's marketing decisions. The microenvironment includes internal factors like the company, suppliers, customers, and competitors. The macroenvironment includes external factors like demographic, economic, natural, technological, political, and sociocultural forces in the larger marketplace. These forces can influence demand, costs, and ultimately the company's ability to serve its customers. Marketers must monitor both micro and macroenvironmental trends to develop effective marketing strategies.
2. Marketing Environment
Philip Kotler :
“ A company marketing environment
consists of the factors and forces that
affect the company’s ability to develop and
maintain successful transactions and
relationships with its target customers.”
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3. Marketing Environment
Micro environment Macro environment
Controllable PartiallyUncontrollable
Co Organization Suppliers Demographic
Management Customers Economic
Resources Dealers Ecological
M Mix Competitors Technological
Community Political
( Social groups) Sociological
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4. Marketing Environment
The inputs concerned with micro
environment are –
• Company organization
• Suppliers
• customers
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5. Marketing Environment
The outputs concerned with macro environment
are –
• Political
• Economical
• Technological
Macro environment factors may be –
Controllable or partially - controllable
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6. Micro environmental factors
Company :
• Company organization consists of Board of
Directors and functional managers.
• Marketing plans are drawn up as per the
philosophy of Top management
• Marketing decisions like new products,
expansion, etc depend on the support of top
management. It depends upon finance,
managerial skills, organization’s strengths and
weaknesses.
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7. 1. Company - continued
• Marketing plans should be in harmony with
policies of other departments such as
production, purchase, finance, personnel,
etc
• For ex: quality depends upon production
policies
• Advertising and sales promotion – on
budgets
Dr.S.G.Kulkarni 7
8. 2. Suppliers
• Supply raw materials, plant and equipments,
human resources, technology
• Their strategies affect ours
• If they increase prices, we have to revise price
structure
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9. 2. Suppliers - continued
• Decisions like ‘ make or buy’ depend upon suppliers
• Depends upon
– Right supplier
– Right place
– Right time and lead time
– Right price
– Right quantity
– Right quality
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11. 3. Intermediaries
• Wholesalers, retailers, agents,
transporters, warehousers, ad agencies,
etc.
• This is a choice of channel of distribution
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12. 4. Customers
• Purchase requirements vary from customer to
customer
• Individual customers are influenced by cultural,
social and psychological factors
• They are large in number, scattered, poorly
informed, buy in small quantities and frequently
and are guided by personal considerations
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13. 4. Customers
• Industrial producers are limited in number,
geographically concentrated, buy in large in
bulk, demand is derived, buy on reciprocal
basis, depend on lease hold.
• Dealers buy for resale.
• Government buys for public welfare, defence
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14. 5. Competitors
• Supply similar products or substitute
products
• Competitors adopt different actions for
getting greater share of markets
• All firms compete with each other for
consumers buying power.
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15. 6. Public
• Financial public: financial institutions, investment
houses, insurance co,
• Government public:
• Citizen action public: consumer organizations,
environmental groups, minority groups, etc
• General public: public image
• Internal public: employees, Board, labour unions, press
and media
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16. Macro environment
1. Economic
Economic forces influence both marketers
and the consumers
Economic forces include –
• Competition – monopoly, oligopoly
• Buying power
• Willingness to spend
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17. Macro environment
1. Economic - continued
Economic conditions include
• Economic development
• National income
• Standard of living
• State of agriculture
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18. Macro environment
1. Economic - continued
• Business cycles
• Interest rate
• Price levels
• Fiscal policies
marketers have to take into
consideration the changes taking place in
agriculture and industry
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2. Demography
Demography gives ‘consumer profile’
It is the study of population in respect of its
size, density, location, age, race,
occupation, marital status, education, sex
composition etc
All these factors influence marketing
decisions
20. 2.Demography - continued
• School Kids with Income and Purchasing
Power
• Mother Older, Baby Younger
• Double Income, No Kids
• Poor Urban Population
• Well Off Older Folks
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21. 2.Demography - continued
• Mexico is a nation of young population
• Japan – ‘old generation’
• America was a melting bowl. Now it is a
‘Salad bowl’ with Chinese, Filipinese,
Japanese, Asians, Koreans
• Ads – show women as decision makers
due to increase in education
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22. Demography - continued
Education
• Illiterates
• High school drop outs
• Matriculates
• Graduates
• Professional degrees
• Post graduates
Dr.S.G.Kulkarni 22
23. 2.Demography - continued
• Buying habits are determined by income,
education, age, family composition and
other demographic factors
• It helps in - Market segmentation, demand
forecasting, determination of market
potential
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24. 2.Demography - continued
• India’s population is roughly 108 crores
• 75% of population lives in villages
• Rural marketing offers immense
opportunities and challenges to a creative
marketer
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25. 2.Demography - continued
• You find that the demand is increasing not
only for farm products, but also for non-farm
products
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26. Technology
• It has a definite impact on buyers and marketers
decisions
• It provides mechanical, physical and numerous other
processes which help in attaining higher standard of
living
• It has adverse effects like pollution, unemployment,
increase in crime rate, etc
• Marketers must be aware of new developments in
technology.
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27. Technology-continued
• Technological developments may put
some people out of business and at the
same time, open up new business
opportunities to others
• For ex: introduction of synthetic fabrics
drove away sheep raisers and cotton
growers out of business
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28. technology
• Solar pocket calculators and hand
cameras
• CDs and Video tapes
• Virtual reality applications in Marketing is a
new application due to technological
progress
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29. Technology-continued
• Technological developments have
improved the standard of living and given
more leisure time
• Improvements in communication,
transportation
• Technology has given wonder drugs like
Ampicilliin, by- pass surgery,
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30. Technology-continued
• Technology grows out of research made
by business, universities
• Most of the products that we talk today
were not there a few years back. For
example, Computers, Photostat, laser
technology, scanners.
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31. 3. Natural factors and ecological factors - also
• These also affect the pattern of industries
and marketing
• Industries create pollution of air, water and
environment
• The package in the form of plastic bags
and bottles create a lot of problems
• Some governments have banned the use
of plastic bags.
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32. Political factors
• Marketing is affected by monetary, fiscal,
import and export policies
Some of the Acts applicable are as follows:
• Essential Commodities Act
• Prevention of Food Adulteration Act
• Trade and Merchandise marks Act
• Packaged Commodities Act
• Companies Act
Dr.S.G.Kulkarni 32
33. Political factors - continued
• Political and legal factors are inter connected
• Discontinuation of – CCI, FERA, IDRA
• Introduction of SEBI, FEMA, VAT
• Rules allow private participation in transportation
, telecom, airlines
Dr.S.G.Kulkarni 33
34. Social-Cultural environment
• Advertisements and culture
• Some ads are banned on TVs
• Festivals like Ganesh festival, Diwali, Id-
Milad, Christmas,
• Dress styles are different
• School uniforms
Dr.S.G.Kulkarni 34
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Cultural factors - continued
• Food habits
• Internet practice
• Fast foods – Pizza hut, Ken Fried Chicken
36. Cultural factors - continued
• There are several movements like trade
union movement, consumer movement,
women's lib, deprived classes movement ,
etc.
• These have their own expectations from
the market. If they are against their ideas,
they boycott the products
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37. Cultural factors - continued
Cause related Marketing
• 1980 saw the advent of “ cause related
marketing”
• The distinctive feature of case-related
marketing is the firm’s contribution to a
designated cause being linked to
customers’ engaging in revenue-producing
transactions with the firm
• Example: CRY, AWWA, WWF cards
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