2. Meaning
• The marketing environment is considered as
part of the marketing planning process and
explores various internal and external forces
that might affect a business and its capacity to
operate. This can be anything from
technological and cultural forces to influences
such as suppliers, customers and competitors
3. • In simple words,
“All those forces which affect the sales of any
product are called marketing environment.”
“Marketing Environment comprises the Non-
Controllable factors & forces that impact on
the company’s markets & marketing.”
4. • “the Marketing Environment is a set of forces &
institutions which affect the marketing decisions of the
company but are not influenced by the company.”
• This definition refers to the external environment of
marketing which is made up of different factors like
demographic, cultural, economic, political, legal &
technological factors.
• These factors are beyond the control of management &
always changing. So management has to adaptive. As
the changes in business environment provide threats
to some & opportunities to others, management can’t
avoid analysis & study of the environment.
5. SWOT analysis
• S-Strengths - Positive Internal Factor
• W-Weaknesses - Negative Internal Factor
• O-Opportunities - Positive External Factor
• T-Threats - Negative External Factor
• The one which belongs to external environment factors
are beyond the control of management. E.g. O
(positive term) & T (negative term).
• Company has to make every efforts to remove
weaknesses and with the help of strengths &
opportunity overcome the threats to the company.
6. Threat
According to Kotler,
“An environmental threat is a challenge posed
by an unfavorable trend or specific
disturbance in the environment which would
lead, in absence of purposeful marketing
action, to the stagnation or demise of a
company, product or brand.”
7. Opportunity
“Opportunity means a challenge to take steps
for the object oriented sales function, wherein
there is a group of suitable environment &
there is a probability of success.”
8. Effects constituting threats &
opportunities
• Economical Forces-consumption pattern, level of savings,
average income level, per capita income, etc.
• Social Forces-beliefs, attitudes, social values, life style,
standard of living, etc.
• Political Forces-LPG due to which competition increases &
there is a change in govt. role.
• Natural Forces-pollution of air, water, noise from factories
& industries which if not controlled, business may be closed
down.
• Global Forces-competition in international market pose
many threats & opportunities for India. Due to competition,
price reduction, quality improvement, etc are availed to
general public.
11. Micro/Internal Environment
1. Company- The company creates a separate
department for marketing which prepares all
the strategies for marketing, the marketing
manager is expected to work in co-operation
with other departmental heads like financial
manager, R&D manager, production manager,
etc. as all these departments have an impact
on the marketing departments plan &
actions. So a good inter-relationship is
needed.
12. Micro/Internal Environment
2. Suppliers – The business companies &
individuals supplying materials & other
necessary equipments, tools, spares, etc are
the suppliers. They include electricity
provider company, RM suppliers, packing
material suppliers, etc. All these have an
impact on the marketing departments plans
& actions. Eg. If RM prices increases, it has to
increase the product price.
13. Micro/Internal Environment
3. Marketing intermediaries - Marketing
intermediaries are those who help the
company in promoting, selling & distributing
goods to the final buyers/consumers. They
are of two types: agent middlemen &
merchant middlemen. The former does the
job of bringing customers while the latter are
the wholesalers, retailers, etc. they have an
influence over marketing decisions.
14. Micro/Internal Environment
4. Customers – 5 target markets as given:-
– Consumer market
– Industrial/producer market
– Reseller market
– Government market
– International market
Each type of market have special characteristics.
Marketing manager has to formulate policy &
strategies keeping all these into consideration.
15. Micro/Internal Environment
5. Competitors – There are a number of
competitors in the market. He is supposed to
study the strategy of competitors, needs of
consumers and try to frame strategic policy
as against competitors & avail competitive
advantages by acquiring a larger share of
market.
16. Micro/Internal Environment
6. Public – Here Company maintain a separate
public relations department which remains in
touch with public like common public,
financial institutions like banks, insurance
companies, public media like newspapers,
magazines, government for rules & legal
procedure, etc.
18. Macro/External Environment
1. Demographic forces – Demography is a study
of human population in terms of size, birth
rate, marriage rate, death rate, location, age,
gender, race, occupation, etc. Population is
one of the important aspect as market is
made up of people, Marketing manager has
to study all these aspects.
19. Macro/External Environment
2. Economic Forces – Economic forces show
purchasing power & pattern of spending.
Marketing manager is interested in people &
their purchasing power. Purchasing power is
dependent on present income, changing
income, savings rate, rate of interest, etc.
Marketing manager has to formulate policy &
strategies keeping all these into
consideration.
20. Macro/External Environment
3. Physical or Natural Environment – Pollution
of air, water, noise from factories & industries
are included in natural environment. If these
are not controlled, business may be closed
down. In addition to this, shortage of RM,
increasing fuel prices, etc also affect
marketing decisions.
21. Macro/External Environment
4. Technological forces – These forces have a
notable impact on people’s life. With
changing technology, consumption pattern,
life style, etc also changes. For this R & D
department is needed. Marketing manager
has to formulate policy & strategies keeping
all these into consideration.
22. Macro/External Environment
5. Political & legal Forces – It includes govt.
laws, govt. institutions, Social pressurizing
groups, etc. Now many laws which affect
marketing are framed for protecting
consumers’ interest. Marketing manager has
to formulate policy & strategies keeping all
these into consideration.
23. Macro/External Environment
6. Social & culture forces – It includes beliefs,
attitudes, social values, life style, standard of
living, etc. Indian Culture do pujas, samaj
sevas, etc. but on the other hand behave
dishonestly in daily routine activities.
Marketing manager should try to change
these beliefs, attitudes, social values &
thereby promote sales.
