8 Changing Marketing Environment

Bhagwan Singh

QUADRANT-1

LEARNING & INSTRUCTIONAL OBJECTIVES At the end of this chapter, learner should be able to:

• Know why to study Changing Marketing environment

• Define Marketing Environment

• Know different types of Marketing Environment

• Understand Changing Marketing environment

• Know how elements of Macro & Micro Environment affect Changing Marketing Environment

• Revise by Gist/Summary of the Module

• Solve Review questions

1. INTRODUCTION

Business today is not mere transaction of monetary benefits from one person to another. Neither is it indicator of the growth of prosperity nor wealth. It is fully complex strategically defined and well organised plan which works under various dependent and independent variables popularly termed as business environment. It is fully dependent on the environment where it is conducted, organised, developed and flourished. As the environment is changing, it is giving full impact on changing marketing environment. Today it is the requirement to understand Changing Marketing environment.

Previously, when barter economy existed only two – seller and purchaser – existed as players of the business, but gradually by the inception of money the players in business increased and the role of business entrepreneur started circulating on the environments where they were operating. But now the scenario is beyond profit. The selling extended its vision towards marketing. The company and CEOs or business minded people are not talking monthly sales graph but are focusing on customer satisfaction. Workers working within organizations are causative to the welfare of society and of each other, and obtaining satisfaction of their own needs in turn this multifaceted network of exchanges results in a societal betterment and good standard of living for everybody.

This is giving impact on changes and thus affecting the marketing environment. To study this we have to study changing marketing environment. Hence, all the businesses are depended on the changes in the business environment leading towards customer’s satisfaction. And the customer’s satisfaction comes from observing changing marketing environment. This is done by exploring the players or stakeholders operating in this environment which has its own dynamics in changing environment of marketing.

2. DEFINITION

Marketing environment is the environment which clubs the entire (Macro) environments where business operates in which firms with their capacity (Micro environments) influence their customers by their projection (Marketing Mix) to be best from their competitors.

Marketing environment is the cumulative form of the factors that encapsulate within themselves the ability of a firm to connect with the consumers and also the potency of the product as a growth driver to the firm

The Marketing environment consists of all the actors and forces influencing the company’s ability to transect business effectively with its target market.

From a marketing viewpoint, managing the exchange process between the firm and its customers comes highest on the list of priorities, but it would be impossible to carry out this function without considering the effects of customer-based decisions on other people and organizations.

3. TYPES OF MARKETING ENVIRONMENT

Macro environment are the factors that affect all the firms in an industry AND External environment are the factors that operate outside the organization.
Micro environment are the factors that affect one firm only AND Internal environment are the factors that operate within the organization.

3.1 Macro & External environment

This environment explains how changes in this environment affect marketing decisions. External Environment which affects the company broadly affected by Macro environment. This environment is considered to be afar from the control of the organization.

• Cultural environment

• Natural environment

• Political environment

• Economical environment

• Social environment

• Technological environment

• Ecological / Eco-Friendly environment

• Legal environment

• Glocal environment, in addition to above environments,

As now by the emergence of internet accessibility, the Globe has become like a village, hence two more factors / environment are equally affecting marketing environment.

• Globalization

• Localization

Clubbed together they are as Glocal. (Global + Local)

Largely now Macro and External Environment clubs CN_PESTEL_G

3.2 Micro & Internal environment

This environment describes the environmental forces that affect the company’s skill to serve its customers. Internal Environment of the company broadly affected by Micro environment. It is area inside the company which affects the planning strategy of the company for it marketing mix or product / service promotion. The company focus is on “thinking about customer as a king”. Providing customer satisfaction at its best possible is core discussion and effect by this environment. This environment is considered to be under partial control of the organization.

The main actors in this environment which affect changing marketing environment are:

• Suppliers

• Marketing intermediaries

Resellers
Physical distribution firms
Marketing services agencies
Financial intermediaries

• Publics

Financial Publics
Media Publics
Government Publics
Citizen-action Publics
Local Publics
General Publics
Internal Publics

• Competitors

• Customers

4. UNDERSTANDING CHANGING MARKETING ENVIRONMENT

Fig-1: Environment affecting Changing Marketing Environment (Source: Author Created)

The changes in marketing environment Forces Company and all of the other actors operate in a larger macro environment of forces that shape opportunities and pose threats to the company. The companies CEOs or business entrepreneurs are bound to work under the threat of these changing marketing environments as it affects the organization.

5. ELEMENTS OF MACRO AND MICRO ENVIRONMENT AFFECTING CHANGING MARKETING ENVIRONMENT

5.1 MACRO & EXTERNAL ENVIRONMENT

The CN_PESTEL_G are considered to be the most dominating factors in considering changes of marketing environment plans by the companies. Lets discuss the each factors involved in it.

5.1.1 Cultural environment

Marketing mission has to consider this factor while planning for product launch or promotion. Culture is from what and where the people upbringing has been done. It projects the behaviour, attitude, perception and customs under which the customer has been present. This refers to the differences in customs, beliefs and behaviours between peoples. It is the shared set of beliefs and behaviours prevalent within the society in which the company operates. These include purchasing behaviour, gift-giving behaviour, gender roles, age, location, language, religious beliefs, history, religion, customary ways of working and the like. When it changes it affects the changing marketing environment.

For Example: In India many people do not consume meat and alcohol in Navratries. Hence, the traders in this business have to close or compromise their business for nine days, once in six months. This is where culture hits the marketing decisions of the businessmen involved in the sale of meat and alcohol. On the other hand in the same India, there is massive sale of utensils, apparels and e-appliances on Diwali and Dushera as Festive season sale. Here, the marketers have full opportunities to encash the demand and convert customers towards themselves.

Fig-2: Cultural Environment (Source: www.mylifeqs.com)

No society exists without human being and no culture is developed without society. Therefore, cultural environment is also studied with social environment. As both are intact together and affect each other because they both are directly influenced by the public so one can also study them together in marketing environment as socio-cultural environment. The changing marketing environment is depended on changes in socio-cultural environment also.

Socio-Cultural environment is a set of beliefs, customs, practices and behavior that exists within a population. International companies often include an examination of the socio-cultural environment prior to entering their target markets. This revolves around basic four elements:

Demographic: this refers to the structure of the universe or the population like age, gender, income, cast, creed and the like.
Culture: it refers the differences in behaviour, attitude, perception and customs between peoples.
Social ethics and responsibilities: it is part from the culture, ethical beliefs about how or in which way the people respond to the marketing initiatives regarding product or services.
Consumerism: refers to the power of consumers forced to be followed by companies.

Fig-3: Socio-Cultural Environment (Source: Author Created)

5.1.2 Natural environment

Natural Environment consists of natural resources which are required as inputs by marketers or which are affected through marketing activities. The natural environment covers all living and non-living things occurring naturally on Mother Earth. It is an environment that covers the communication of all living species. Changes in climate, weather, and natural resources that affect human survival and economic activity are to be studied under this for changing marketing environment. Marketing of natural products, fuel efficient automobiles, solar energy vehicles etc are the examples on which the companies are working as changing marketing demand, to penetrate the customers mind.

The promotion mix based on nature is developed to demonstrate the product and motivate consumers to have satisfaction on the level that they are not harming the nature while consuming the product. Brands named behind nature or geographical names like Himalaya brand of Mineral Water, Natural Fresh for juices, Mango Fruity soft drink, Pudin Hara medicine etc are the examples of marketing of products in the name of nature giving the impact created by natural environment.

Changes in this environment hits changing marketing environment. The companies are threatened by the natural climatic environment especially where there are prior declared danger zones. These may be earthquake / seismic zones, sunaami prone areas, volcanic trauma etc. the business companies have to get the insurance done for their offices and employees for these natural hazards and this burden ultimately lies on the pricing policy of the company, which in turn affects the consumers pocket.

Tourism marketing precisely depends upon the nature oriented travel. Tourists are more motivated by the advertisements related to nature and want to feel it by spotting those areas. Marketers create illusion to cash these places by massive promotion mix. Now-a-days online promotion for nature is very much popular. Thus this environment also affect in marketing division.

Factors that impact Natural environment

The main constraints for the marketers are to explore and rectify the problems related to the natural environment. The main factors which affect this environment are:

Environmental sustainability
Increased Government Involvement
Increased Pollution
Less awareness for alternative resources
Limited Natural Resources
Raw Material shortage

Marketers have to plan accordingly keeping in view all the above constrains. For example, plastic is banned in Himachal Pradesh. Now if the companies who are packaging in plastics have to market in Himachal Pradesh they have to repackage the products in paper packaging. Likewise, the coal diggings are also licensed in Jharkhand and are sold in coal blocks. Many scams have been done in the name of this limited natural resource. The coal helps in electricity production and steel making which is marketed by the companies in various forms.

Fig-4: Natural Environment (Source: Photo taken by Author of Dhauladhar Himalyan Range in Dharmshala, Himachal Pradesh, Bharat)

Under this environment the key concerns are: Geological activities, Water on Earth, Atmosphere, Climate, Weather, Life, Ecosystems, Wilderness.

Fig-5: Natural Environment projecting Weather, Water on Earth, Life, Atmosphere & Wilderness

(Source: Photos taken by Author of Dharmshala, Himachal Pradesh, Bharat)

5.1.3 Political environment

Country is governed by the political system which prevails as per constitution or governance. India being the democratic country is fully depended on this political environment. No business in Bharat is thought or perceived without politics. Rather now-a-days even politics has become business. The changes in political business are argued to be the prominent factor affecting changes in marketing environment. Hence, marketers have to look this environment on very crucial angle. Their decision making capacity is very much affected due to this environment.

Change in governance changes the whole marketing scenario of the country. The impact of this environment is so high that the countries economical, social and legal aspects of changing marketing environment are bound to change. The marketers are so much depended on this factors that sometimes they even go for bribing the government in form of donation in party funds to make the policies in their favor so that they can do the business easily.

Political environment or factors are the areas which include laws related to labor, environmental issues, trade restrictions, tariffs, tax policy and political stability. Political factors also include goods and services which the government aims to provide (merit goods) and those that the government does not want to provide (demerit goods). The governments also have a high impact on the health, education, and infrastructure of a nation.

The major factors which are looked by the marketers in this macro environment which impact on changing marketing environment are:

Corruption prevailing and its level
Government stability
Government stand on Environmental and Consumer-protection legislation
International Reputation and FDI policies
Levels of Corruption in bureaucracy and its control
Media’s Freedom
Other factors directly or indirectly controlled by politicians and politics.
Regulations by regulatory bodies and de-regulation trends
Social and employment legislations
Tax policy
Trade and tariff policy and controls
Type of Government (Central / State)

5.1.4 Economical environment

A change in economy affects the decision made by changing marketing environment. Economy of any country is the true mirror of its growth and hindrances. The economic factors which effect this environment are value of currency, inflation, cost of living, interest rates and so forth gives the impact of the changing marketing environment prevailing in the country. These factors greatly affect how businesses operate and make decisions.

In India where the consumption is more as per compared to income, the distribution of product and services is a challenge for the marketers. Economic factors include inflation rate, interest rates, exchange rates and the economic growth. For example, interest rates affect a firm’s cost of capital and would therefore to what extent a business grows and expands. Value of currency can affect the costs of export and import and exchange rates can re-define the tariff policies.

The economic environment broadly consists of:

Competition
Current and projected economic growth
Impact of globalization
Inflation and interest rates
Infrastructure
Labour costs
Levels of disposable income and income distribution
Likely impact of technological or other changes on the economy
Per Capita Income
Stage of a business cycle
Unemployment and supply of labour
Other changes related to the economy

5.1.5 Social environment

Society resembles the trends and culture prevailing in the location or place where it exists. This environment is crucial due to the reason that the consumers are directly related to the society. The society affects and influences the consumer to make purchase decision. Consumers are governed by the motivational factors of the society.

In India on the occasion of Holy almost all apparels companies give massive discount to motivate the customers for garment purchase as it is societal tradition that new clothes are wore after playing holy.

The local haats or melas are the best example of social environment which force marketers to think on the promotion of their products and services. These can be also studied as socio-cultural environment as discussed previously in cultural environment.

The issues related to social environment which effects changing marketing environment are:

Education, occupations, earning capacity, living standards
Cultural aspects, population growth rate, health consciousness
Demographic age, gender, race, family size & geographic distribution
Ethical issues, diversity, immigration/emigration, ethnic/religious factors
Organizational culture, attitudes to work, management style, staff attitudes
Media views, law changes affecting social factors, trends, advertisements, publicity

Fig-6: Social Environment (Source: www.whatisindia.in/indian-culture-unity-in-diversity)

5.1.6 Technological environment

Technological environment is basically related to innovations and invention. How the companies are improvising their product or services comes under this environment which impacts changing marketing environment. It includes technological aspects like automation, technology incentives and initiatives and R&D activity and the rate of technological change. These activities create a type of monopoly market for the companies working on it. It gives competitive edge or advantage from the other company trading in the field.

For example Apple is the best leader in iPads, iPhone and iPod market. Its innovation and inventions are such that no company can touch or reach to customer’s expectation as Apple does.

This way technological environment can determine barriers to entry, minimum efficient production level and influence the outsourcing decisions. Furthermore, technological shifts would affect costs, quality and lead to innovation.

Major issues pertaining to these environments which impinge changing marketing environment are:

Competing technological developments
Information technology, internet, global and local communications
Inventions and Innovations
Maturity of technology
R&D activities
Rates of obsolescence
Technology access, replacement technology/solutions, intellectual property issues, advances in manufacturing
Technology rules, legislation, licensing and patents
Transportation, energy uses, alternative sources for fuels, associated or dependent technologies,
Waste management or removal or recycling

5.1.7 Ecological / Eco-Friendly environment

Ecological or Eco-friendly environmental aspects are those which directly hamper the environmental issues. We have seen various types of environment affecting changing marketing environment by Natural Environment such as weather, climate and climate change, which may affect industries such as coal, steel, tourism, farming, insurance, automobiles, electronics and so forth.

Furthermore, changing marketing environment has prominent effect from growing awareness of the potential impacts of climate change affecting how companies operate, the products they offer, both creating new markets and diminishing or destroying existing ones. The concept of Green marketing has emerged to follow up this environment. The companies are making super normal profit on the name of going Green.

For example previously Electronics Companies were not rating their products as per electricity consumption. Now they give “Stars” in terms of consumption of electricity. Like if 5 Stars are there on any electrical appliance predicting less electricity consumption and so forth. Almost all companies dealing in F&B (Food & Beverages) are packaging the juices in tetra packs of paper instead of bottles. The shampoos are packed in recyclable plastics.

Fig-7: Eco-logical Environment (Source: Pictures taken by Author)

Many laws by the government in India have been imposed on the companies to make the environment clean and products be eco-friendly. Like government has banned plastics, passed pollution act, forest Act and the like for preserving the mother earth.

The issues where the marketers are concerned under this environment which impact on changing marketing environment are:

Ecological and environmental issues,
Environmental regulations
Customer values
Market values
Stakeholder or investor values
Other issues pertaining to green or eco-friendly products

5.1.8 Legal environment

Law of any country governs the customer, market and above all what and where to be marketed. Legal environment is essential to be known by the marketers as it permits or limits the changing marketing environment regarding product or services. It includes all acts and laws governing the company, consumer and customer which are revised time to time. For example:

Antitrust law
Companies Act
Compensation Act
Consumer Forum
Consumer law
Cyber Law
Discrimination law
Employment law
Factories Act
Health and safety law
Insurance Act
Trade Union Act
Other laws, rules, regulations and acts related to it.

These factors can affect how a company operates, its costs, and the demand for its products. The current key concerns under this changing marketing environment are:

Compensation rules etc.
Competitive regulations
Consumer protection
Current home market legislation
Employment law
Environmental regulations
Future legislation
Industry-specific regulations
International legislation
Regulatory bodies and processes

5.1.9 Glocal environment

By the emergence of internet accessibility and that too at very low cost today the online shopping trend is creeping up. This is the best example of changing marketing environment. This environment basically holds two factors – Global plus Local – Glocal. In this the local made products are sold or marketed globally. For example: Handicrafts of Rajasthan are sold through websites in global market. The Kangra Paining, Kulu Shawls, Banarasi Sarees, Amul Milk and the like are demanded and marketed worldwide. Hence these two factors or environment are equally affecting marketing environment.

Globalization
Localization

Clubbed together they are as Glocalisation (Globalization + Localisation) affecting changing marketing environment.

Fig-8: Glocal Environment (Source: http://contiitgs-2013.wikispaces.com/ Globalization + and + Cultural+diversity)

The Globe has become a village and the market has taken a new shape of MELA. The Malls are new conversion of older concept: the melas, where people used to gather and shop in one defined place. Almost everything was present in these melas for the customers to purchase. Now the transformation of these melas is present in new form of Malls. The Mall culture has given the same feel as of melas. Consumer is free to do window shopping and free to purchase at their disposal. In extension to it now the market place has been converted into market space i.e. from real world to virtual world, from physical market to virtual market.

5.2 MICRO & INTERNAL ENVIRONMENT

This environment describes the environmental forces that affect the company’s skill to serve its customers. Internal Environment of the company is broadly affected by Micro environment. It is the area inside the company which affects the planning strategy of the company for it marketing mix or product or service promotion.

The changing marketing environment from micro environment comprises those elements of the environment that impinge on the firm and usually its industry, but do not affect all firms in all industries. The company focus is on “thinking about customer as a king”. Providing customer satisfaction at its best possible is core discussion and is affected by this environment. This environment is considered to be

under partial control of the organization. The factors involved in it are competitors, customers, distribution channels, suppliers, and the general public.

Fig-9: Micro Environment (Source: Author Created)

The main actors in this environment which affect changing marketing environment are:

5.2.1 The Company

The company is the main element in micro environment as it is the key ruler of the entire changing marketing environment. The stakeholders are connected to it and all the profits and losses regarding it affect the stakeholders, thus affecting the company. It involves:

1. Staff relationship

2. Brand Image

3. Goodwill

4. The Market where it operates

a. Perfect Competition

b. Monopoly

c. Oligopoly

d. Monopolistic Competition

5. Integration or diversification

5.2.2 Suppliers

They are the firms and individuals who are the resource providers for the company. Whatever the company requires like raw material, travel support, promotion mix, employees, labour, stationary, financial assistance & support is provided by these supplier.

But the big threat of this environment is that the suppliers have bargaining powers. Thus they hit the changing marketing environment a lot. They control the company by creating or maintaining syndicate or by industry control. The main factors in bargaining power of suppliers are:

Concentration among suppliers
The degree to which suppliers’ products can substitute for each other
Vertical integration
Switching costs
The importance of the buyer to the seller.

This is why this environment has internal affect and has to be controlled.

5.2.3 Marketing intermediaries

Under this environment those firms which help the companies to promote, sell, deliver and distribute its good to final purchasers, are involved. Changing marketing environment has its own limitations regarding decision making forced by this environment. They help the companies to forward the product manufactured by the companies to the ultimate customers. The companies must build healthy relationship with these intermediaries such that the company and the intermediaries benefit in the long run.

The key elements involved in this are:

Fig-10: Marketing Intermediaries (Source: Author Created)

1. Resellers

These are the agencies or individuals those who purchase the product from the company and with nominal margin forward it to ultimate consumers. The marketing environment from this factor is affected due to companies pricing policies, the brand image and demand and supply factor. They are those who hold the product and sale it to customers. Broadly they are termed as wholesalers and retailers. Now-a-days since Mall Culture is developing in almost all cities, hence the wholesalers and small retailers are at threat.

2. Physical distribution firms

They are those who stock or move companies product from one place to another. They are transporters and warehouses. The costs incurred by them are ultimately levied on the customer. This again effects on the prices of the product which has to be controlled time and again.

3. Marketing services agencies

These are the facilitators in promoting the brand or product or services of the company. They are:

Advertising agencies
Consultants
Marketing Research firms
Media people
Web site developers and managers

4. Financial intermediaries

These intermediaries help in managing monetary transactions, taxation and business risk. They help in finance transaction and insure against risks. They are:

Banks
Credit Companies
Charted Accountants & Firms
Internet Banking Facilitators
Insurance Companies
Mobile baking Facilitators
Others related to facilitate it

5.2.4 Publics

They are those groups that have an actual or potential interest in or impact on an organization’s achieve its objectives and goals. They dictate or facilitate the organization to follow it vision, mission objective and goals which impacts changing marketing environment.

Citizen-action Publics
Financial Publics
General Publics
Government Publics
Internal Publics
Local Publics
Media Publics

5.2.5 Competitors

The companies dealing in the same industry with same or resembled product or services are termed to be competitors of any company. The big threat to the operating company is that the customer may switch to other company’s product which gives the same or relative satisfaction offered by the product of operating company.

For example: Pepsi & Coke are rivals for each other in Beverages segment. They keep on launching and promoting their brands to pull the customers on their product consumption.

In this, changing marketing environment is always monitored. It is done by conducting competitor’s analysis which is a great challenge. It is done to monitor its competitor offers to create strategic advantage. The level of competition among the competitors may be segregated and studied as:

Firms offering anything to the same target market
Firms offering products which do a similar job
Firms offering virtually identical products

Competitor analysis basically covers:

Image or Brand or Reputation
Infrastructure
Likely Plans
Market Share
Marketing Mix
SWOT

Changing marketing environment may also be observed by competitor analysis carried out by using Porter’s Five Forces Model (Porter 1990). This model offers a way of assessing the likely strength of competition in any given market.

The Porter’s five forces are as follows:

Bargaining power of suppliers. If suppliers have strong bargaining power, the competitive pressure will be greater.
Bargaining power of customers. Customers with strong bargaining power will be more demanding and can set one supplier against another. This will make the competition tough.
Threat of new entrants. If it is easy for new companies to set up in the same business, the competition will be strong. If it is difficult for new firms to enter the market, the existing firms can become smug.
Threat of substitute products and services. If close substitutes are readily available, the competition will be stronger. For example McDonalds is selling burger at the price which normally a consumer can get any thelas (local vendor) food.
Rivalry among current competitors. Some industries firms have “We Live You Live” approach, which reduces competition. This is particularly in the case of oligopolistic markets, and in markets that are well-established. This is in new or rapidly-growing markets where such rivalry will tend to be stronger and therefore the competition will be tougher.

For example: Online shopping websites like flipcart.com, olx.in and snapdeal.com keep on promoting their promos on TV to make the consumer aware and purchase or shop through their sites.

5.2.6 Customers

The customers are the actual buyers of the products and services. They are the real decision maker to purchase or not to purchase. The changing marketing environment is totally focused by this environment. If customer will not purchase, the consumer will not consume. The company has to study the customer market as each customer market has its own characteristics.

The group of customers or individuals, the nature of them, the different segments of the market made up of people with slightly different needs, will all affect the company’s changing marketing environment.

Broadly customer market is differentiated as:

1. Business Market

Purchases products and services for manufacturing purpose or further processing or re-use or refine to make new product or services and sell it further. It broadly covers those sub segments from where the small companies buy from big companies or visa-versa for production or manufacturing purpose.

2. Consumer Market

Any goods or services purchased by individual for consumption for household or official activities positioned under this segment. It is more for personal consumption than to be public oriented. The products or services sold or marketed under this category are focused for personal consumption.

3. Government Market

The firms or agencies which sell or market to or for government are considered under this category. Those agencies which buy products and services in order to produce public services or transfer them to those that need them are the market of this segment.

4. International Market

Purchasers of all categories in foreign market underlie in this category. The market based on foreign country. These are the buyers from all the countries.

5. Reseller Market

They are the buyers who buy to resell the product based on margin. Already discussed in marketing intermediaries

The above discussions have cleared the concept of changing marketing environment. Thus, in marketing environment macro and micro environment are equally important to study changing marketing environment. They guide the forces for decision making by the companies and to decide on strategic level how they can penetrate the market by controlling or overcoming these environments.

A video is worthwhile watching put on website of mhhe.com can explain the whole environment of changing marketing environment of Bass Pro Shops opened for fishing and other activities to give customers their satisfaction at a new level.

I acknowledge them and thank them for posting these types of videos which may be used for explaining the changing marketing environment also.

Base Pro Shops Video:

http://lectures.mhhe.com/media/0078028981/Video_Cases/BassProShopsOutdoorWorld.m4v

6. GIST / SUMMARY OF MODULE:

6.1 Definition

6.2 Types of Marketing Environment:

Macro environment are the factors that affect all the firms in an industry AND External environment are the factors that operate outside the organization.
Micro environment are the factors that affect one firm only AND Internal environment are the factors that operate within the organization.

6.3 Macro & External environment

Cultural environment
Natural environment
Political environment
Economical environment
Social environment
Technological environment
Ecological / Eco-Friendly environment
Legal environment
Glocal environment

Largely now Macro and External Environment clubs CN_PESTEL_G 6.4 Micro & Internal environment

This environment describes the environmental forces that affect the company’s skill to serve its customers. Internal Environment of the company broadly affected by Micro environment. It is area inside the company which affects the planning strategy of the company for it marketing mix or product / service promotion. The company focus is on “thinking about customer as aking”. Providing customer satisfaction at its best possible is core discussion and effect by this environment. This environment is considered to be under partial control of the organization.

The main actors in this environment are:

Suppliers

The main factors in bargaining power of suppliers are:

Concentration among suppliers
The degree to which suppliers’ products can substitute for each other
Vertical integration
Switching costs
The importance of the buyer to the seller.

Marketing intermediaries

Resellers
Physical distribution firms
Marketing services agencies
Financial intermediaries

Publics

Financial Publics
Media Publics
Government Publics
Citizen-action Publics
Local Publics
General Publics
Internal Publics

Competitors

Competitor analysis basically covers:

Infrastructure
SWOT
Likely Plans
Image or Brand or Reputation
Marketing Mix
Market Share

Customers

Customer Market

Business Market
Consumer Market
Government Market
International Market
Reseller Market

7. REVIEW QUESTIONS:

Q1) What do you understand by changing marketing environment? What is Marketing Environment?

Ans: Business today is not mere transaction of monetary benefits from one person to another. Neither is it indicator of the growth of prosperity nor wealth. It is fully complex strategically defined and well organised plan which works under various dependent and independent variables popularly termed as business environment. It is fully dependent on the environment where it is conducted, organised, developed and flourished. As the environment is changing, it is giving full impact on changing marketing environment. Today it is the requirement to understand Changing Marketing environment.

Q2) How many types of major marketing environments are present which has impact on changing marketing environment?

Ans: Types of major marketing environments which has impact on changing marketing environment:

Macro environment are the factors that affect all the firms in an industry AND External environment are the factors that operate outside the organization.
Micro environment are the factors that affect one firm only AND Internal environment are the factors that operate within the organization.

Q3) Indicate the main actors in Micro Environment which affect changing marketing environment?

Ans: The main actors in Micro environment which affect changing marketing environment are:

Suppliers

The main factors in bargaining power of suppliers are:

Concentration among suppliers
Switching costs
The degree to which suppliers’ products can substitute for each other
The importance of the buyer to the seller.
Vertical integration

Marketing intermediaries

Financial intermediaries
Marketing services agencies
Physical distribution firms
Resellers

Publics

Citizen-action Publics
Financial Publics
General Publics
Government Publics
Internal Publics
Local Publics
Media Publics

Competitors

Competitor analysis basically covers:

Image or Brand or Reputation
Infrastructure
Likely Plans
Market Share
Marketing Mix
SWOT

Customers

Customer Market

Business Market
Consumer Market
Government Market
International Market
Reseller Market

Q4) Explain different types of marketing intermediaries with model.

Ans: Under this environment those firms which help the companies to promote, sell, deliver and distribute its good to final purchasers, are involved. They help the companies to forward the product manufactured by the companies to the ultimate customers. The companies must build healthy relationship with these intermediaries such that the company and the intermediaries benefit in the long run.

Q5) Briefly explain how many types of customer markets are present?

Ans: Broadly customer market is differentiated as:

1. Business Market

2. Consumer Market

3. Government Market

4. International Market

Purchasers of all categories in foreign market underlie in this category. The market based on foreign country. These are the buyers from all the countries.

5. Reseller Market

They are the buyers who buy to resell the product based on margin. Already discussed in marketing intermediaries

Q6) What is Glocal environment? Make the model of Micro Environment?

Ans: Glocal environment

By the emergence of internet accessibility and that too at very low cost today the online shopping trend is creeping up. This environment basically holds two factors – Global plus Local – Glocal. In this the local made products are sold or marketed globally. For example: Handicrafts of Rajasthan are sold through websites in global market. The Kangra Paining, Kulu Shawls, Banarasi Sarees, Amul Milk and the like are demanded and marketed worldwide. Hence, two factors o*r environment are equally affecting marketing environment – Globalization and Localization. Clubbed together they are as Glocalisation (Globalization + Localisation) affecting marketing environment.

QUADRANT-III

INTERESTING FACTS

Glocal Environment:

Hence these two factors or environment are equally affecting marketing environment.

Globalization

Localization

Clubbed together they are as Glocalisation (Globalization + Localisation) affecting changing marketing environment.

The Globe has become a village and the market has taken a new shape of MELA. The Malls are new conversion of older concept: the melas, where people used to gather and shop in one defined place. Almost everything was present in these melas for the customers to purchase. Now the transformation of these melas is present in new form of Malls. The Mall culture has given the same feel as of melas.

Consumer is free to do window shopping and free to purchase at their disposal. In extension to it now the market place has been converted into market space i.e. from real world to virtual world, from physical market to virtual market.

REFERENCES:

Books Referred

Kotler, Phillip and Gary Armstrong, Principles of Marketing (Version 12/E). Pearson Education Inc. New Jersey, 2006
Philip Kotler, Suzan Burton, Kenneth Deans, Linen Brown, Gary Armstrong, Pearson Higher Education, AU, 2013
Kumar Arun & N Meenakshi, Marketing Management, 2/e, Vikas Publication, New Delhi, 2011

Websites Referred

http://lectures.mhhe.com/media/0078028981/Video_Cases/BassProShopsOutdoorWorld.m4v
http://in.video.search.yahoo.com/yhs/search;_ylt=A2oKiZdiWzJWDSoAUc4O9olQ?p=marketing%20environment%20ppt&fr=yhs-iry-fullyhosted_003&fr2=p%3As%2Cv%3Ai%2Cm%3Apivot&hsimp=yhs-fullyhosted_003&hspart=iry
http://www.powershow.com/view4/5e0ad9-MGNlO/Understanding_Markets_Market_Demand_and_the_Marketing_Environment_powerpoint_ppt_presentation
http://www.powershow.com/view/154860-MDZjN/Marketing_Environment_powerpoint_ppt_presentation
http://www.slideshare.net/gururajgp/marketing-environment-13338219
http://www.slideworld.com/pptslides.aspx/marketing-environment
http://www.docslide.com/the-marketing-environment/
http://www.marketingteacher.com/marketing-environment/
http://cita.disability.uiuc.edu/presentations/pdf/examples/untagged_example.pdf
http://www.scribd.com/doc/94976162/Class-Notes-The-Marketing-Environment#scribd
https://en.wikipedia.org/wiki/Market_environment
http://www.sagepub.in/upm-data/58888 _blythe_pandp_chapter_2_the_marketing_environment.pdf
http://www.mbaskool.com/business-concepts/marketing-and-strategy-terms/3949-marketing-environment.html
https://en.wikipedia.org/wiki/Market_environment
http://www.vikaspublishing.com/books/business-economics/marketing/marketing-management/9788125942597/
http://www.mylifeqs.com/cultural-integration
http://www.expertsmind.com/questions/what-is-natural-environment-in-marketing-30196032.aspx
https://en.wikipedia.org/wiki/Natural_environment#/media/File:Hopetoun_falls.jpg
http://www.whatisindia.in/indian-culture-unity-in-diversity/
http://contiitgs-2013.wikispaces.com/Globalization+and+Cultural+diversity
http://en.reingex.com/Segmentation-Brand-Positioning.shtml