NO ORGANISATION CAN OPERATE IN A VACUUM.

IT IS SURROUNDED BY A GIVEN ENVIRONMENT ON SOME OF WHICH IT MAY AT TIMES EXERTS SOME CONTROL WHILE ON SOME OTHERS IT CANNOT DO ANYTHING BUT ACCEPTS THEM AS GIVEN. Discuss this statement showing the impact of the environment on the marketing activities of the organization. Use local examples to illustrate your answer. INTRODUCTION: The marketing environment In order to identify correctly opportunities and monitor threats, the organization must start with a thorough understanding of the marketing environment in which it is operating. An organizations marketing environment can be defined as: the actors and forces external to the marketing management function of the firm that impinge on the marketing managements ability to develop and maintain successful transactions with its customers. Though these factors and forces may vary depending on the specific company and industrial group, they can generally be divided into broad micro environment and macro environment components.

Starting with the microenvironment, it consists of stakeholder groups that an organization has regular dealing with and that can exerts some pressure to some extent on them. So the microenvironment consists of six forces close to the company that affect its ability to serve its customers are: a. b. c. d. e. f. The company itself (including departments). Suppliers. Marketing channel firms (intermediaries). Customers. Competitors. Public (community).

On top of that, the macro environment takes into account all factors that can influence an organization, but are outside of their control. There are six major macro marketing environment forces to deal with (PESTLE): a. b. c. d. e. f. Political. Economic. Socio-cultural. Technological. Legal. Environmental.

MICRO ENVIRONMENTAL ANALYSIS

The micro environment is also known as the Task environment, it affects organization and marketing at the daily operation level. The effect of microenvironment changes are noticed more or less instantaneously. Organizations have to analyze and monitor deeply all the aspects of microenvironments so as to adapt to rapid change and stay competitive. COMPANY The first force is the company itself and its role in the microenvironment. This could be deemed the internal environment. 1) The companys mission, objectives, broad strategies, and policies are being set by the Top management. 2) Decisions made by marketing managers should be within the parameters established by top management.

3) Marketing managers must also work closely with other internal department such as; finance, R & D, Purchasing, manufacturing, and accounting. If all these departments follow the same objective and goals, then the company would definitely produce better results. 4) All department must think consumer if the firm is to be successful. The objective is to provide superior customer value and satisfaction. For example in Mauritius, the Infinity BPO limited was making a lost, so the service had to stop and some employees alleged to receive only one tenth of their salary.

SUPPLIERS Suppliers are firms and individuals that provide the resources needed by the company and its competitors to produce goods and services. The behaviour of a supplier will directly impact the business it supplies. Organisations must decide on issues such as who to use to supply them, on the responsibility it takes for these suppliers and on the terms and conditions it adopts. Some organisations take quite an aggressive attitude towards their suppliers by trying to push down the prices and delay payments. Others view the relationship more as a partnership in which they are working together with suppliers and that by helping each other both can benefit. MARKETING CHANNEL FIRMS (INTERMEDIARIES) Marketing intermediaries are firms that help the company to promote, sell, and distribute its goods to final buyers. It can be classified into three types: Physical distribution Firms: Help for stocking and moving goods from their point of origin to their destinations. Marketing service agencies: There are organisations such as marketing research firms, advertising agencies and media firms which help the company to target and promote its products and services. Financial intermediaries: some examples of this type of intermediaries are banks, credit companies, and insurances companies. They help the finance transaction and insure against risks. E.g Banks give money to people who already possess loads of money because there are low levels of risk. Or even a regular customer can easily get a loan because of the relationship that has been created.

CUSTOMERS Customers are the KING; they are obviously the key to sales. Organisations survive on the basis of meeting customer needs and wants and providing benefits for their customers now and in the future. Failure to do so will result in a failed business strategy. Organisation should never let its customer looks elsewhere. Without customers no organization can operate.

PUBLIC (COMMUNITY) Public constitute a major force in the micro environment and any organization has to pay vigilant attention to their values, beliefs, opinion and attitudes in order to design for goods carefully tailored to meet the needs of the target consumer segment.

COMPETITOR Competition shapes business. A study of the competitive scenario is essential for the marketer, particularly threats from competition. Without competition, no organization can be innovative and profitable. The success and behaviour of any organization will depend on the degree of competition in its market. If an organization is not aware of its competitors activities, the latter will find it very difficult to remain on top of them. As a business organization, it is vital to examine competitors responses to changes in trading conditions, consumers behaviour or technological developments so that the organization can maximize the impact of its response.

MACRO ENVIRONMENT ANALYSIS

The macro marketing environment takes into account all factors that can influence an organisation, but are outside of their control. There are six major macro marketing environment forces to deal with (PESTLE): political, economic, socio-cultural, technological, legal and environmental (natural). POLITICAL AND LEGAL ENVIRONMENT It consists of Government Regulations, policies, social groups and so on. Any kind of business must be abided by the legal policies of the nation. Law is here in order to protect customers from exploitation by the business man, to protect interest of society and moreover to protect companies from unfair competition. If law has been passed, whether you like it or not you will have to adapt or perish. ECONOMIC ENVIRONMENT The economic environment consists of the factors that affect consumer purchasing power and spending patterns. It includes the state of the business cycle, the distribution of income within the population, the balance of the payments and government monetary and fiscal policies. SOCIAL AND DEMOGRAPHIC ENVIRONMENT This consists of factors such as size, growth rate, religious composition, age distribution and literacy level some aspects like household patterns, population shifts, composition of workforce and regional characteristics.

SOCIO-CULTURAL ENVIRONMENT Culture is set of beliefs and customers pertinent in a society. The market should adjust the decisions with respect to the cultural and social beliefs. This type of environment consists of customs, lifestyles and values that characterize the society in which the firm operates. One simple example is; in India, Mc Donalds had to stop its products containing Beef as cow is regarded as goddess there. If Mc Donalds kept on selling Beef product then it would make a big lose. Cultural is going to dictate to an Organisation what to sell and when to sell and where to sell. In other words, bring the right product to target market only. TECHNOLOGICAL ENVIRONMENT Nowadays technology is controlling and changing the human society and has a great impact on the future. Literally, technology has transformed the way people think, work and relax. Technological changes may create new opportunities for an organization, or threaten the survival of a product, or industry. Technological innovation continues to move at an increasingly rapid rate. ENVIRONMENTAL (NATURAL) Environmental factors include the climate change and the weather. Many industries like the farming, tourism and insurance can have a great impact due to changes in temperature. With a huge climate changes occurring due to global warming and with a lot of environmental awareness this external factor is becoming an important issue for firms to consider. In order to protect the environment, many organizations are moving towards ecofriendly products and this is affecting demand patterns and creating business opportunities.

http://www.studiowide.co.uk/blog/marketing-environment-macro http://www.learnmarketing.net/microenvironment.htm http://www.zainbooks.com/books/marketing/principles-of-marketing_12_marketing-macroenvironment.html http://www.oup.com/uk/orc/bin/9780199296378/01student/additional/page_10.htm http://sujai-marketing.blogspot.com/2010/11/micro-environmental-analysis.html