Week 2 - The Marketing Environment

Question 1

What is the marketing environment

Answer 1

The marketing environment is the internal and external factors that influence a company’s marketing decisions. It affects every stage of the 4 steps in the marketing process.

If businesses analyse the marketing environment, they can adapt to challenges and take advantage of opportunities.

Components of the marketing environment:

1: Microenvironment
a) The company (top management [decision makers], research and development team, operations team, accounting team, human resources team, legal team)
b) Suppliers
c) Marketing intermediaries (resellers [retailers, wholesalers], physical distribution firms [logistics, transportation], marketing service agencies [research, advertising, media, consulting], financial services [banks, credit, insurance, accountants])
d) Competitors
e) Publics (groups that have interest in or impact on a company’s ability to achieve its objectives [media, government, employees])
f) Customers

2: Macroenvironment
a) Demographic
- The study of human populations
- Age, gender, ethnicity, family size, educational level, occupation
- Falling birthrates and longer life expectancy is a key observation to note
- Millennials born between 1977-2000 are the largest generation in AUS and NZ.
- Each generation has different characteristics (e.g. genZ blend online and offline worlds seamlessly and are concerned about gender and social equality)
b) Economic
- Affects consumer purchasing power
c) Natural
- Natural resources that are needed as inputs
- Growing shortages in raw materials - renewable resources (forests, food), nonrenewable (oil, coal, minerals)
- Increased pollution which requires more government intervention
d) Technological
e) Political
- Laws, government agencies and pressure groups that influence or limit various organisations and individuals. Business legislation is enacted to:
protect companies from each other, protect consumers from unfair business practices, protect the interests of society against unrestrained
business behaviour.
f) Cultural values
Values passed from parents to children.

Methods for collecting information about the marketing
environment:
- Marketing research
- Marketing intelligence

Question 2

5 types of customer markets

Answer 2

1: Consumer markets
- Individuals/households purchasing for personal consumption

2. Business markets
   - Purchasing for further processing or for use in their production process

3: Reseller markets
- Buy goods and services to resell at a profit

4: Government markets
- Government agencies that buy products to produce public services or to transfer the goods and services to others who need them

5: International markets
- Buyers in other countries (any of the 4 types above)