Marketing Environment

Marketing management rests squarely on the knowledge of marketing environment Environment plays a crucial role in marketing Securing the right fit between environment and the firm using marketing mix as the tool is the crux of marketing The firm has to know where it is heading, what trends are emerging therein and what should be its response to the environmental changes
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Purpose of Marketing Environment Analysis

To know where the environment is heading, to observe and size up the relevant elements events and trends in environment To discern which events and trends are favorable, unfavorable and figure out opportunities and threats hidden in the environmental events and trends
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Purpose of Marketing Environment Analysis

To assess the scope of various opportunities and short list those that can favourably impact the business To help secure the right fit between the environment and the business unit To help the business unit to respond with a matching products market strategies To project how the environment i.e. each factor of environment will be at future point of time
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Tasks Involved in Marketing Environment Analysis

It is a process of filtering and analyzing information relating to marketing environment It monitors the changes taking place in environment

Tasks Involved in Marketing Environment Analysis

Forecasting future position in respect of each of the factors Analysis / spots the opportunities and the threats in the environment and pinpoints the ones that are specifically relevant with the firm

Factors to Be Covered in Environment Analysis

Mega / Macro Environment and Environment that is specific to the given business

Mega / Macro Environment

Demographic Environment Factors relating to size, growth rate, age, distribution, religious composition and literacy levels need to be studied Aspects such as composition of workforce, house hold patterns, regional characteristics population shifts etc. also need to be studied
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Mega / Macro Environment

Socio Cultural Environment Cultural beliefs, traditions, beliefs and values and lifestyles of people in a given society constitute the socio cultural environment These elements to a large extent decide what the people will buy and consume
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Mega / Macro Environment

Economic Environment General economic conditions Economic conditions of different segments of the population, their disposable income, purchasing power etc Rate of growth of economy, and of each sector of economy Income, prices, consumption expenditures Credit availability and interest rates etc
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Mega / Macro Environment

Political Environment Economic environment is a by-product of political environment since policies followed by a nation greatly depend on its political environment Developments on the political sides keep affecting the economy all the time Industrial growth depend upon legislation regulating businesses are also often a product of political configuration
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Mega / Macro Environment

Natural Environment Natural resources: Raw Materials, energy etc Ecology: Environment pollution, protection of wild life, and ocean wealth Climate: Firms with products whose demand depends upon climate and firms depending upon climate dependant raw materials will be particularly concerned.
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Mega / Macro Environment

Technological Environment Technology leads practically all the forces that shape peoples lives For a firm's technology affects not only its final products but also its raw materials, processes and operations as well as its customer segment Rapid changes are taking place in the realm of technology
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Mega / Macro Environment

Legal Environment Businesses have to operate within the framework of prevailing business environment They have to understand the implications of all legal provisions relating to their business

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Environmental Factors Specific to Business Concerned

Market / Demand Nature of demand Size of demand, present & potential Changes in demand Invasion of substitute products Changes taking place in consumption patterns/buying habits

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Environmental Factors Specific to Business Concerned

Consumer Consumer tastes & preferences Buying motives Purchase decisions Post purchase behaviour

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Environmental Factors Specific to Business Concerned

Industry and Competition Knowledge about industry and competitions fundamental requirement for developing marketing strategy Building competitive advantages and cores competencies in industries

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Environmental Factors Specific to Business Concerned

Government policies

Profoundly affect the specific environment of businesses

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Environmental Factors Specific to Business Concerned

Supplier Related factors

Suppliers constitute one of the fine forces shaping competition any industry They influence costs of Raw material and quality They can become direct competitors
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Finally

Environment analysis has to be a

NON STOP CONTINUOUS AFFAIR

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