MM1-Mkt Env. - Ch2
Uploaded by
Anand MauryaMM1-Mkt Env. - Ch2
Uploaded by
Anand MauryaMarketing
Environment
Environment Analysis
Internal forces + Micro + Macro
Macro
Internal
Micro
Factors = Resources , capabilities
and core competencies
= Customers,
competitors, company
stakeholders and
intermediaries
= Political , Economic,
Social , Technological
Internal Environment
The internal environment is made up of
factors within the firm itself. It includes:
› employees,
› company policy,
› capital assets,
› the firm's structure and
› the firm's products (materials).
These factors can be controlled by the
firm.
Micro Environment
Compan
y
What Is a
Marketing Information System?
A marketing information system
consists of
people, equipment, and procedures to
gather, sort, analyze, evaluate, and
distribute
needed, timely, and accurate information to
marketing decision makers.
Internal Records and
Marketing Intelligence
Order-to-payment cycle
Sales information system
Databases, warehousing, data mining
Marketing intelligence system
MIS
A marketing intelligence system is a set of
procedures and sources that managers use to
obtain everyday information about
developments in the marketing environment.
Train sales force to scan for new developments
Motivate channel members to share intelligence
Hire external experts to collect intelligence
Network externally
Utilize a customer advisory panel
Utilize government data sources
Purchase information
Macro Environment
PEST Analysis :
• Political
• Economic
• Social
• Technological
Analyzing the Macroenvironment
Needs
Fads – unpredictable, shortlived and
without social economic and political
significance.
Trend – sequence of events that have
some durability.
Megatrends – slow to form but last
typically 7-10 yrs.
Major Forces in the Environment
1. Demographic – population studies.
Population growth
Population age mix
Ethnic and other markets
Education levels
Household patterns
Macro : Political Forces
Political factors
1. How is the industry classified in the country ?
2. What government laws will influence, regulate or tax your business?
3. Does Government encourage or protect the industry from foreign
players ?
4. What is the government's policy on the imports of goods?
5. Does the government have a specific view on culture and religion?
6. Is the government involved in trading agreements with global
partners?
Macro - E of PEST Analysis
Economic Factors
1.Interest rates
2.The level of inflation
3. Employment level per capita
4. Long-term prospects for the economy
5. Gross Domestic Product (GDP) per capita
6. Consumption pattern
Economic Environment
Consumer Psychology : Consumer spending depends on disposable
income, socioeconomic profile, aspirations, and expectations from
the future.
inflationary environment: consumers become choosy, bargain
for better deals, buy bulk or economy packs, and postpone
discretionary purchases. In a recessionary environment: tighten
their belt, simplify their consumption pattern, and hunt for bargains.
Income Distribution
› Subsistence economies : few opportunities for marketers
› Raw-material-exporting economies: Eg. Middle East for equipment,
tools, supplies, and luxury goods for the rich
› Industrializing economies : India, Egypt, Philippines: new rich class and a
growing middle class demand new types of goods
› Industrial economies: rich markets for all sorts of goods.
Income, Savings, Debt, Credit
Income Distribution in India
distribution of households in broad income categories in India and their aggregate
consumption for 2005, and forecasts for 2015 and 2025. Marketers need to take
note of these trends and develop strategies to facilitate these changes and also
benefit from them.
Macro:- S of PEST Analysis
Social factors
1. What is the dominant religion?
2.What are attitudes to foreign products and services?
3.Does language impact upon the diffusion of products
onto markets?
4.How much time do consumers have for leisure?
5.What are the roles of men and women within society?
6.How long are the population living? Are the older
generations wealthy?
7.Do the population have a strong/weak opinion on green
issues?
Socio-cultural Environment
Society shapes beliefs values and norms which ultimately
govern consumption.
Regional differences in language customs, social systems
values habits religion caste system all make socio-cultural
environment very complex in India.
Significant variation in food habit, dress, festival purchase,
language, media consumption habits.
Core beliefs: Values passed on from parents to children
and reinforced by social institutions.
Secondary Beliefs : More open to change. Marketers can
affect the secondary beliefs and values.
Macro - T of PEST Analysis
Technology Factors
1.Does technology allow for products and services to be made more cheaply
and to a better standard of quality?
2. Do the technologies offer consumers and businesses more innovative
products and services such as Internet banking, new generation mobile
telephones, etc?
3. How is distribution changed by new technologies e.g. books via the
Internet, flight tickets, auctions, etc?
4. Does technology offer companies a new way to communicate with
consumers e.g. banners, Customer Relationship Management (CRM), etc?
Technological Environment
Accelerating Pace of change Cellphone,
computing, analytics, space science,
photography etc.
Opportunities for innovation - immense
Varying R&D budgets
Increased regulation of change –
controls are important else rampant
trials and misuse.
The Political-Legal Environment
Business Legislation - 4 major purposes
› Protect companies from unfair competition
› Protect consumers from unfair business practices.
› Protect society from unbridled business behavior
› Charge business for social costs
Growth of Special Interest Groups - organised
movement by citizens and govternment.
Redressal forum, consumer courts etc.
PEST Analysis
Political Economical
· Government type and stability Labor and other resource availability and
•Freedom of press, rule of law and levels of costs
bureaucracy and corruption •Levels of disposable income and income
•Regulation and de-regulation trends distribution,
•Social and employment legislation •Impact of globalization
•Tax policy, and trade and tariff controls •Likely impact of technological or other
•Environmental and consumer-protection legislation change on the economy
•Likely changes in the political environment •Likely changes in the economic environment,
business cycles
•Growth pattern in Industry, key industries
and Industry clusters
Socio-Cultural Technological
· Population growth rate and age profile •Technological level of the industry, own
•Population health, education and social mobility, and industry
attitudes to these • Supplier and customer industries
•Population employment patterns, job market • State and private R&D expenses
freedom and attitudes to work • Lifecycle phases of relevant products
•Press attitudes, public opinion, social attitudes and •Impact of Internet, reduction in
social taboos communications costs and increased remote
•Lifestyle choices and attitudes to these working
Natural Environment
need to integrate environmental issues
into
the firm’s strategic plans
