Environment

Environment literally means the surroundings ,

external objects, influences or circumstances
under which someone or something exists. The
environment of an organization is the aggregate
of all conditions, events and influences that
surrounds and affects it. Since the environment
influences an organization in many ways, its
understanding is of crucial importance.

Marketing Environment

The market environment is a

marketing term and refers to
factors and forces that affect a
firms ability to build and
maintain successful
relationships with customers

Marketing Environment
Successful Companies take outside- Inside view of the
business

Recognition of new Opportunities & Threats presented

by the environment

Need is to continuously monitor & adapt to the

environment

All successful companies recognize & respond profitably

to unmet needs & Trends

Components of Marketing
Environment
Internal
Environment
Micro
Environment
Macro
Environment

Micro Environment
The micro-environment affects the organization
directly. It refers to the environment that most
closely linked to the firm

This environment is also not under the full control

of business.

The business can influence this environment.

ORGANISATIONS INTERNAL
MANAGEMENT
RESEARCH

FINANCE

AND

DEVELOPME
NT

FACTOR
Y

PURCHA
SE
MARKETING

Micro Environment
Customer

Public
Components
Supplier

Marketing
Intermediaries

Competitor

Customer
Customers are the

actual buyer of our

goods and services.

The company must

study its customer

markets closely since
each market has its own
special characteristics.

Customers: The customers of a company

may be of five types:

1. Ultimate customers
2. Industrial customers
3. Resellers
4. Government and other non- profit
customers

5. International customers

Customer Market
Consumer Market

individuals and households that buy goods and services for

personal consumption

Business Market

buy goods and services for further processing or for use in

their production process

Reseller Market

buy goods and services in order to resell them at a profit

Government Market

agencies that buy goods and services in order to produce

public services or transfer them to those that need them

International Market

buyers of all types in foreign countries

Suppliers
Suppliers are firms and

individuals that provide

the resources needed by
the company.

They are an important

link in the companys

overall customer value
delivery system.

Suppliers

Point of Consideration

Availability
Price of key inputs

Competitors
Conducting competitor
analysis is critical for
success of the firm

A marketer must
monitor its competitors
offerings to create
strategic advantage

Competitors
Must understand competitors strengths
Must differentiate firms products and offerings from
those of competitors

Competitive strategies should emphasize firms

distinctive competitive advantage in marketplace

Continuum of Competition
Many
BASIS OF
COMPARISON

PURE
COMPETITION

Number of sellers
MONOPOLISTIC
COMPETITION

# of sellers

many sellers

Product

Homogeneou Differentiated
s

Barriers
Mkt
power

No barriers
None

Large

OLIGOPOLY

One

MONOPOLY

Few

One

Similar

Unique

No barriers

High

Huge

Little

Lots

Infinite

Marketing Intermediaries
Marketing
intermediaries are firms
that help the company
to promote, sell, and
distribute its goods to
final buyers.

Marketing
Intermediaries

Reseller

Physical
distribution
firms

Marketing
service
agencies

Financial
intermediaries

Marketing Intermediaries
Reseller
They are those who hold and sell companys
product.
Wholesaler and retailer.

Physical Distribution Firm

They help the company to stock and move goods
from their points of origin to their destinations.
Transportation and warehousing.

Contd
Marketing Service Agencies
They help the company target and promote its
products.
Advertising agencies. Media agency, marketing
research firms, etc.

Financial Intermediaries
They help finance transactions and insure against
risks.
Banks, credit companies, insurance company, etc..

Public
A public is any group that has an actual or
potential interest in or impact on an
organizations ability to achieve its objectives.

A company should prepare a marketing plan for

all of their major publics.

Public Group
Financial

Internal

Citizen

Government

Public
Group
General

Local

Media

Responding to the marketing

environment

Those who make things happen:

Take aggressive actions to affect the publics and forces in their

marketing environment

Develop strategies to change the environment

Those who watch things happen:

Passively accept the marketing environment.
Do not try to change it.

Those who wonder whats happened:

Confused to do an actions and failed to identify the problem
because of the environment changes

MACRO ENVIRONMENT
Macro environment refers to those factors
which are external forces in the companys
activities and do not concern the immediate
environment. These are uncontrollable
factors which indirectly affect the concerns
ability to operate in the market effectively.

DEMOGRAPHIC

TECHNOLOGICAL

MACRO

SOCIAL

POLITICAL

 Demographic factors: Demography is

the study of population in terms of size,
density, location, age, gender, occupation
etc. These factors have a huge impact on the
marketing decisions of the company.

For example, a growth in population means

increasing human needs which results in
the expansion of product markets, if there
is sufficient purchasing power.

 Economic factors: It consists of factors related to the

means of production and distribution of wealth that

have an impact on the functioning of an organization. It
affects the spending power of people. Further economic
development and growth affects the product choice of
the customers. For example- per capita income, Balance
of payment position, Gross national product, inflation,
deflation etc.

 Physical

factors: Components of physical

forces are the earths natural renewable and
non renewable resources. Natural renewable
resources are forests, food products from
agriculture or sea. Non renewable resources
are finite such as oil, coal, minerals etc. both
these components often change the level and
type of resources available to a marketer for
his production.

 Political

and legal factors: These factors

include the policies related to public sector,
small scale industries, sick industries, import
and export, licensing, development of
backward areas etc. the vast governmental
network of laws and regulations have varied
impact on marketing activities.

 Soci0- Cultural

factors: It comprises of society

and culture. A society is a set of relations among
people including their social status and roles.
Culture consists of attitudes, customs, beliefs and
values of a society.
SOCIOCULTURA
L

SOCIET
Y

CULTUR
E

References
Marketing Mix by Gayatri27
The marketing environment
macro environment or external
macro environment.by izzahnoaedia

Marketing micro environmentthis presentation will

help you to know about various
micro environmental factors which influences the
activity of marketing.by 17somya