The term Marketing Environment refers to the forces and factors that affects the organisation ability to built and maintain good relationship with its customers. Marketing environment surrounds the organisation and it impacts upon the organisation. Marketers have to interact with internal and external people at micro and macro level and builds internal and external relationships. The key elements of marketing environment are as follows:
1. Internal Environment
2. Micro Environment
3. Macro Environment
1. Internal Environment
Internal factors like men, machine, money, material, etc., on which marketing decision depends consists internal marketing environment. The internal environment refers to the forces that are within the organisation and affects its ability to serve its customers. It includes marketing managers, sales representatives, marketing budget, marketing plans, procedures, inventory, logistics, and anything within organisation which affects marketing decisions, and its relationship with its customers.
2. Micro Environment
Individuals and organisations that are close to the marketing organisation and directly impacts its ability to serve its customers, makes Marketing Micro Environment. The micro environment refers to the forces that are close to the marketing organisation and directly impact the customer experience. It includes the organisation itself, its suppliers, marketing intermediaries, customers, markets or segments, competitors, and publics. Happenings in micro environment is relatively controllable for the marketing organisation.
3. Macro Environment
Macro environment refers to all forces that are part of the larger society and affects the micro environment. It includes demography, economy, politics, culture, technology, and natural forces. Macro environment is less controllable.
The followings are the macro environments:
• DEMOGRAPHIC ENVIRONMENT
It shows explosive population growth worldwide, or in specific territories, a changing age, sex, ethnic mix, changes in education, income, race, religion, occupation, household ownership, family size, geographical population shift from rural to urban areas, etc. See the chapter in the book of ‘Marketing Management by Philip Kotler for further elaboration on age, income, and household groups.
• ECONOMIC ENVIRONMENT
It shows a slow down in real income growth, low savings, high debt, difficult availability of credit, etc.
• NATURAL ENVIRONMENT
It shows potential shortage of certain raw materials, unstable cost of energy that fluctuates production cost, increased pollution, and a growing green movement’ to protect the environment. Companies have to adopt their system to the new regulations and demands from the public interest groups like non-government organizations concerned with protecting the natural environment. Other companies tack this as an opportunity and produce recyclable products and finite nonrenewable resources.
• TECHNOLOGICAL ENVIRONMENT
It exhibits/show acceleration technological changes, innovational opportunities for new discoveries, increasing RND budget, and changing regulation about technology. Technological environment: hurt for example xerography (or photo copying) hurts carbon paper business, autos railways business, television, hurts newspaper business, and cell phone hurt landline telephone business, so companies must have a for sight on future technologies.
• LEGAL-POLITICAL ENVIRONMENT
It shows changing government policies and regulations, the influence an policy makers by pressure groups of business community, and public interest groups of civil society. See the table in the afore- said book to note Us regulation affecting marketing practices. For instance the Government of Pakistan in posed ban on cigarette smoking in 1996, thus badly hurt the cigarette industry.
• SOCIO-CULTURAL ENVIRONMENT
It shows changing values of society members, their belief’s, attitudes, behaviors, preferences, customs, traditions rituals and psychographics including social classes, personality, and lifestyles.
• ECONOMIC ENVIRONMENT
It shows a slow down in real income growth, low savings, high debt, difficult availability of credit, etc.
• NATURAL ENVIRONMENT
It shows potential shortage of certain raw materials, unstable cost of energy that fluctuates production cost, increased pollution, and a growing green movement’ to protect the environment. Companies have to adopt their system to the new regulations and demands from the public interest groups like non-government organizations concerned with protecting the natural environment. Other companies tack this as an opportunity and produce recyclable products and finite nonrenewable resources.
• TECHNOLOGICAL ENVIRONMENT
It exhibits/show acceleration technological changes, innovational opportunities for new discoveries, increasing RND budget, and changing regulation about technology. Technological environment: hurt for example xerography (or photo copying) hurts carbon paper business, autos railways business, television, hurts newspaper business, and cell phone hurt landline telephone business, so companies must have a for sight on future technologies.
• LEGAL-POLITICAL ENVIRONMENT
It shows changing government policies and regulations, the influence an policy makers by pressure groups of business community, and public interest groups of civil society. See the table in the afore- said book to note Us regulation affecting marketing practices. For instance the Government of Pakistan in posed ban on cigarette smoking in 1996, thus badly hurt the cigarette industry.
• SOCIO-CULTURAL ENVIRONMENT
It shows changing values of society members, their belief’s, attitudes, behaviors, preferences, customs, traditions rituals and psychographics including social classes, personality, and lifestyles.
