Instructional Objectives

At the end of the class, you should be able to:

1. define marketing environment.

2. classify marketing environment.
3. differentiate between micro & macro environment.
 The Marketing Environment

The marketing environment includes the actors and

forces outside marketing that affect marketing
management’s ability to build and maintain successful
relationships with target customers.
 Types of marketing environment

There are 2 types of marketing environment. Such as:

1. Micro environment
2. Macro environment

Microenvironment consists of the actors close to the company

that affect its ability to serve its customers.

Macro environment consists of the larger societal forces that

affect the microenvironment.
Difference between macro & micro environment

Macro environment Microenvironment

It is very large in size. It is smaller than macro environment.
The components of macro The components of microenvironment
environment cannot be controlled. can be controlled to some extent.

It is very unpredictable & highly It is not very unpredictable & ranks

uncertain. low uncertain.

The components are very complex in The components are comparatively

nature. low complex in nature.

It includes- political, demographic, It includes- company, suppliers,

cultural, natural, technological & marketing intermediaries, customer
economical environment. markets, competitors, and publics.
 Instructional Objectives

At the end of the class, you should be able to:

1. explain the components of micro environment.

2. narrate the components of macro environment.
 The Microenvironment
Microenvironment consists of the actors close to the company
that affect its ability to serve its customers. The components
of micro environment are as follows:
The company:
In designing marketing plans, marketing management
takes other company groups into account—groups such
as top management, finance, research and development
(R&D), purchasing, operations, and accounting. All these
interrelated groups form the internal environment.
Suppliers: Suppliers form an important link in the company’s
overall customer, value delivery system. They provide the
resources needed by the needed by the company to produce its
goods and services.

Supplier problems can seriously affect marketing. Marketing

managers must watch supply availability—supply shortages or
delays, labor strikes, and other events can cost sales in the short
run and damage customer satisfaction in the long run.
Marketing intermediaries: Marketing intermediaries help the
company to promote, sell and distribute its products to final buyers.

They include resellers, physical distribution firms, marketing

services agencies, and financial intermediaries.

•Resellers are distribution channel firms that help the company

find customers or make sales to them.

•Physical distribution firms help the company to stock and move

goods from their points of origin to their destinations.
Customers: The Company needs to study five types of customer markets
closely.

•Consumer markets consist of individuals and households that buy goods and
services for personal consumption.

•Business markets buy goods and services for further processing or for use in
their production process.

•Reseller markets buy goods and services to resell at a profit.

•Government markets are made up of government agencies that buy goods

and services to produce public services or services or transfer the goods and
services to others who need them.

•International markets consist of these buyer in other countries, including

consumers, producers, resellers, and governments.
Competitors:
The marketing concept states that to be successful, a
company must provide greater customer value and
satisfaction than its competitors do. Thus, marketers
must do more than simply adapt to the needs of target
consumers.
Publics: A public is any group that has an actual or potential
interest in or impact on an organization’s ability to achieve its
objectives. We can identify seven types of publics;

•Financial publics influence the company’s ability to obtain funds,

Banks, investment houses and stock-holders are the major
financial publics.

•Media publics carry news, features, and editorial opinions.

•Government publics; Management must take government
developments into account. Marketers must often consult the
company’s lawyers on issues of product safety, truth in
advertising and other matters.

•Citizen-action publics: A company’s marketing decisions may be

questioned by consumer organizations, environmental groups,
minority groups and others.

•General publics: A company needs to be concentrated about the

general public’s attitude toward its products and activities.

•Internal publics include workers, managers, volunteers, and the

broad of directors.
 Macro environment:
The macro environment consists of the larger societal forces that
affect the micro environment. The components of macro
environment are as follows:
Demographic Environment:
Demography is the study of human populations in terms
of size, density, location, age, gender, race, occupation,
and other statistics. Demographic environment is
important because it involves people and people make up
markets.
Economic Environment:
Economic environment consists of factors that affect consumer
purchasing power and spending patterns. Economic factors
represent the wider economy so may include economic growth
rates, levels of employment and unemployment, costs of raw
materials such as energy, petrol and steel, interest rates and
monetary policies, exchange rates and inflation rates.
Natural Environment:
Natural environment involves the natural resources that
are needed as inputs by marketers or that are affected by
marketing activities. Marketers should be aware of several
Trends in the natural environment.

Shortages of raw materials

Increased pollution
Increase government intervention
Environmentally sustainable strategies
Technological environment :
Forces that create new technologies, creating new
product & market opportunities. It also refer to the rate
of new inventions and development, changes in
information and mobile technology, changes in internet
and e-commerce or even mobile commerce, and
government spending on research.
Political Environment:
Political environment consists of laws, government
agencies, and pressure groups that influence or limit
various organizations and individuals in a given society.
Political factors refer to the stability of the
political environment and the attitudes of political
parties or movements.
Cultural Environment:
Cultural environment consists of institutions and other
forces that affect a society’s basic values, perceptions,
and behaviors. People grow up a particular society that
shapes their basic beliefs & values. They absorb a world
view that defines their relationships with others.