Marketing Environment Flashcards
Marketing environment
The environment in which an organisation has to conduct its marketing activities is referred to as the marketing environment.
The marketing environment as a whole is divided into three sub environments: the marketing environment as a whole is divided into three sub environments:
the microenvironment, the market environment and the macro environment.
Micro Environment
The microenvironment is inside the organisation itself and refers to all variables that are directly controlled by management.
Micro Environment Variables
Mission statement. The mission statement of the organisation is defined by management. It may change over time and occasionally be revised, but it is always an internal matter.
• Resources. The organisation uses its resources such as capital and people to create and deliver its market offering. How these people or the money is utilised is an internal decision made by management.
Market Environmnent
The market environment is outside the control of the organisation.
Market Environmental variables:
consumers, intermediaries, suppliers and competitors. Although each of these variables is outside the control of the organisation, it influences the organisation, AND the organisation in turn influences each variable. Did you notice the subtle difference between control and influence? An organisation does not control its competition, but there is a relationship of mutual influence.
Macro Environment
The macro-environment is also outside of the organisation. The crucial difference between the macro-environment and the market environment is the fact that the macro-environment is not influenced by the organisation in any way.
Macro Environment variables:
The technological environment. The economic environment. The social environment. The physical environment. The institutional/political environment. The international environment.
The technological environment.
In most cases, the organisation does not have any influence or control over the technological developments happening around it. Whether we like it or not, the internet is one such technological innovation that influences the organisation.
The economic environment.
The broader economy (globally and in South Africa) affects the organisation in many ways – a recession, interest rates, inflation and so on. All of these variables influence the organisation, but the organisation has little or no control over them.
The social environment.
There is no doubt that broader trends in society (social trends) affect organisations. Consider how HIV has changed the way we do business: the average age of the South African population is getting younger which implies fewer people who are able to do the work and more who are still busy learning.
The physical environment.
Organisations are increasingly becoming aware of the scarcity of natural resources and are adjusting their long-term strategies to include environmental awareness and so-called ”green” issues. While individual organisations can do their bit for the environment, there is no turning back the tide of environmental damage that has been done to the planet.
The institutional/political environment.
While organisations can lobby for political change and plead for more conducive legislation, the final decision still lies with the party in power. The government’s decisions affect the organisation without the organisation being able to influence the government all that much.
The international environment.
The world is truly becoming a global village and countries are no longer living in isolation. Events in Europe or Asia have a profound effect on business in South Africa.
