Marketing environment is a term used to define the factors that influence the marketing sector in a particular setting. There are some forces in the environment that may have a positive or negative impact on marketing. The marketing environment consists of macro and micro environmental factors (Palmer, 1999). All this factors will have an impact on the way the client’s respond to the products that are being offered unto them. The microenvironment factors are mainly the internal influences to the company, that generally relate to how the work of the management is carried out. If the managers employ measures that will attract clients then the forces will influence them into productivity and vice versa. The microenvironment factors on the other hand refer to the other external factors of the society. This could be uncontrollable factors considering that the community is the main determinant of how the company will grow. They may be to the advantage or disadvantage of the company.
Micro- factors that affect the Marketing Environment
As it was defined earlier microenvironment aspects refer to the internal influences of the company that will ultimately affected its trading capabilities (Botha, 2005). This is usually facilitated by the departments in the organization such us finance, human resource, sales and the rest. Even though the departments are managed differently, they have an impact on the entire company. Any simple decision that is made in the sales department will ultimately affect the marketing of the company. When making budgets for the year, the company needs to make overall decisions for the company that must be implemented in every department (Kerin, 2003). Every department is important in ensuring that the company achieves the set goals. The managers may tend to neglect certain department or give priority to the departments that they feel are more important in the organization. This definitely causes the company not to run properly. It is therefore important for the company to ensure that every department has strong codes that they are operating on and that the personnel there in are working equally hard.
The marketing strategy may also be hindered by the distribution of the product. The company may do all that they can to ensure that their products are known all over. Such efforts may however be hindered by the fact that the consumers do not have access to the products that they have been made aware of. As a company launches into extensive marketing strategy, it should also have in place a strong distribution channel that will ensure that their products go as far as their marketing strategy. With the expansion of e-marketing, local products are gaining a lot of popularity on the international market. The customers that may be curious to have a taste of the products may however be disappointed as they realize that the company cannot supply them with the products (Stevens, 2005). This is usually caused by companies that are still experimenting on the capability of their advertisements (Polonsky, 1997). This may however be dangerous as it may cause a complete lack of trust among their clients that were anxiously waiting for the products. As companies invest into modern means of advertising, they should realize that their products may be demanded further and therefore make arrangements of how to reach their customers on time.
Another problem that is brought about by distribution is where the company fails to take statistics of where and how much of their products are on demand. This usually causes unfair distribution of their goods where the customers may have more than what they need or lesser than what they need. Both situations can be disastrous to the company as the former will make the products to get spoilt ad thus bring losses to the company. The latter case will make their customers to resolve to other similar products and thus make the company to loose its market share (Czinkota, 2007). The company should therefore take time to find out the places where there is much demand for their products and those that the demand is not much. It will save them from having to loose their potential customers or incurring losses due to some goods that are not purchased. The trend may also keep changing which might force the company to frequently carry out the researches.
Different customers that the company may have may also have an impact on the microenvironment market (Peloso, 2008). There may be different types of clients that may be depending on the company which include consumers, retailers, governmental or international. All this customers will influence the purchasing power of the companies’ products. The company also needs to introduce different packaging to suit the needs of their clients. For instance, international purchasers will require their goods to be packed in a way that will allow for easier shipping while direct consumer clients may require slightly smaller packages for their products. This may also affect the branding of the products of the products where by international purchasers may want to acquire different brand names to suit the situation in their country (Bearden, 2001). This should be well; handled by the companies so that it maximizes on its sales.
The company may also be faced with the problem of competition from other companies producing similar products. This is something that can not be avoided but adequately handled to ensure that it maintains and improves its market share. To counter this problem, the company needs to be involved in extensive sales promotion tie sure that their products are not scraped out of the people minds. They also need to ensure that they carry out extensive market research to know the changes in technology and customers’ preferences for them to supply them with correct products (Moutinho, 2007). A lot of changes are taking place and with a variety of products that customers can choose from, it has become the duty of the companies to make products that will always be satisfactory to the needs of their customers. They should also invest in high quality production so that their products stand out. The company will also need to develop a powerful customer relations team that will enhance its relationships with their customers.
The microenvironment factors that may impact on the company are other business institutions and organizations (Powell, 2008). Organizations that deal in the quality assurance may require the company to meet certain qualities which may affect their sales strategies. Other financial institutions may also deny the company some of the financial support that they may need to expand their trade practices. The company may also be working with other organizations or companies that may provide them with substandard services and thus hindering their ability to effectively market their products. Such companies may include those involved in making the packages and those endowed with the responsibility of transporting its products (Cateora, 2007). The company may have not grown much and thus relying on other companies for the providing of such services. Unless there is proper coordination, the companies may be a big let down to the company that could be doing all that they can to ensue high and quality production.
Macro factors that affect the Marketing Environment
Macro environment factors refer to the larger society and the impacts that it have on the marketing of the company. Some of these factors are uncountable as they can not be predicted easily. It therefore requires for the company to be always prepared by taking measures that will ensure it does not fall whenever it is exposed to such situation. Such factors may include economy, demography, culture, technology, natural forces and politics. With proper professional prediction and the determination of the company to adjust to the suspected changes will go a.long way in ensuring that the effects do not adversely affect them (Wrenn, 2007). Natural factors are environmental changes that may be disastrous to the production and distribution of the products. For instance, storms and earthquakes may tamper with the transport and communication network and thus making the company to loose a great deal of customers. The company may also be established in an earthquake prone area that may lead to its demolition. Other risks such as fire may also occur to the company causing major loses. It may take time before the company finally recovers from the losses caused by the circumstances.
The economic environment has had impacts on the companies as people abruptly change their purchasing style. There are seasons when almost everybody is going through an economic crunch. If the company suspects the onset of such a season, they are to minimize on the quantity of goods that they are manufacturing so that they don’t get spoilt in the stores (Rugimbana, 2003). The economic situation may also positively impact on the company where the purchasing power of the customers is high. This are the seasons that the company needs to take advantage of the boom and invest into large scale production. Some companies may be slow in understanding such future changes and sticking to their normal production quantity. They later on come to realize the harm they have caused to themselves. Economic changes can not be avoided and thus requires the company to be alert and take the necessary precautions to avoid losses.
Politics may also affect the market environment especially when a country experiences transitions in its political leaders. A new leader may decide to come in with new economic policies that may have an impact on companies and other business organizations (Hair, 2002). Economic policies may also be amended by an act of parliament which may either work for the good or bad of the company. Whatever the case, the company requires to be ready for a change as the political environment of the country also goes through changes. Such changes may also be done considering the international and national challenges that they may be facing. The companies may have nothing to do with them but to adjust to them and ensure that their marketing activities are not tampered with (Crane, 2000). The political situation of other countries may also affect the marketing environment of the country especially if they are involved in international trade. A country may impose some trade barriers on foreign companies and thus affecting their trading activities.
Cultural environment is another aspect of macro environment that may affect the market. When we talk about culture, we are mainly looking at the different lifestyles that the people that are within the reach of the company are adopting. This is a research that has to be done by the company before it launches its production. It is usually advisable that the company engages in production of products that are readily acceptable by the people within such location (Doole, 2008). This will minimize on the issues that may arise due to misunderstandings. They can also establish a marketing strategy within their locality before going further. A company also needs to know the different cultural settings of the communities around so as to know the sales promotion strategies that it will employ. The company will also know the different adjustments that they will have to make so as to continually satisfy their people. The cultural inclination of the people usually change with time, the company will hence have to make the adjustments so as to accommodate the changes that may arise.
The market environment may also be affected by the changes in technology that requires it to make adjustments. With advances in the fields being experienced day by day, it has become costly for many business establishments that are forced to sell or damp off their previous machineries for them acquire new ones. The move is usually irresistible as it becomes the best alternative that will make them fit in the competitive market. Some of their technological advances are however very economical when they are looked at in terms of the production expenses that they will minimize. Modern machines being invented have the ability to multitask and thus ensuring that the company spends less in having to recruit more personnel (Wright, 1999). The company may however need some technical advice concerning the same so that they don’t spend money on machineries that will not have a long impact on them. When it comes to establishing plants and machineries, the company needs to ensure that they are assets that will be able to use for many years to come.
Demography refers to population and the general distribution of individuals. It is also an important factor that will affect the marketing environment of a region. When accompany wants to carry out a sales promotion or a field research on how its goods shall be distributed, they consider the kind of population that they may target so as to implement appropriate strategies (Kurtz, 2009). The company will first need to know the age group targeting for the different products and how they can approach them so that they gain their attention. Depending on the distribution of the place, the company will.also know the kind of media that they will be able to use so us to reach as many people as they can. It will also know the kind of transport system that they will use to ensure that their products reach their potential consumers on time and in good condition. Knowing the age group of the target population will also help the company in understanding their tastes and preferences (Kolb, 2005). The company will hence not rely on trial and error when identifying the advances they need to make o their products. Demography also refers to the income of the target population which will assist the company in knowing the kind of units that they can pack their products into. It will also be necessary when fixing the prices of their products.
The marketing environment is usually affected by different factors that may change from time to time. This will also basically depend on the location of the bu8siness premises and the distribution of its clients. In evaluating the marketing environment, it is usually expected that the company carries out extensive research to venture that they are venturing into the right business (Rod, 2004). Most companies may be comfortable with the initial researches that they did before they ventured into business; this may be disastrous as the market keeps changing day by day. Research on the market environment should be carried out on a regular basis to ensure that that the company is at par with the developments happening around. A company needs to be sensitive to the environmental changes happening around and take advantage of the various available opportunities to maintain their share in the market share. A lot of investments should be done during boom seasons so that when recession comes, they are not adversely affected. The company should also make good use of external expertise that will advice them on the correct measures they can take in case of a crisis. The business may have no control over some factors that affect the business but it can always take correct measures to maintain their share in the market.
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