There are many forces or factors affecting marketing environment and strategies considerably and hence the marketing manager should adjust and adapt to these forces/factors while preparing his marketing plans, policies, and strategies. If possible, efforts should also be made to take advantage of these factors.
Marketing environment scanning is a continuing process of gathering information regarding the company’s internal and external environment, analyzing it, forecasting its trend and impact on the operations and performance of the company.
Marketing environment refers to those factors and forces which affect a company or business.
Factors Affecting Marketing Environment
The major factors affecting marketing environment as follows:
1. Demographic Factors
Demographic factors include structure of the population, division according to sex, age group, income group, material status, and profession, etc.
The study of demographic factors is of vital importance for marketers. It helps to develop an understanding of prospective consumers and market potential of a product and facilities market segmentation.
It provides clues as regards their age, sex, income, and capacity to incur expenditure on the satisfaction of their wants.
The demographic study provides all the requisite information about consumers which is essential for market segmentation.
2. Economic Environment
By economic environment, we mean the purchasing power along with the desire to incur the expenditure of the consumers.
Effective demand depends on the economic environment.
It also determines the market potential of a product. Speedy economic development leads to a rapid rise in the level of income and employment and consequently, there is an increase in the marketing opportunities of different products.
In this way, the economic environment affects the marketing environment of a company.
3. Social and Cultural Environment
Our society is ever changing. According to time, new demands are created and old demands are extinguished.
It is essential for the marketing management that is should prepare the marketing plans according to the changing needs of the society thereby Satisfy new growing needs.
There are three main aspects of the social environment:
- Changes in lifestyles and social values.
- Major social problems, such as anxiety towards growing population, need of safety in different employments, protection to replaceable resources, marketing of products in low-income groups and in rural sectors, etc.
- Growing consumerism which is the symbol of growing consumer dissatisfaction and their increasing desires.
The growing Consumerism is the result of two primary factors. first, the increasing education level of consumers, and second, scientific and Technical progress.
The spread of education and progress made in the field of science and technology is responsible for a rapid increase in the Expectations of consumers with the result that the consumer now is more aware of his right and satisfaction.
The social and cultural environment is also responsible for the growing importance of social responsibility of the industry and the consumer-oriented Marketing concept.
The social and cultural concept of marketing is coexistent with consumer welfare along with public welfare.
4. Public Policy Environment of Legal and Political Forces
The public policy environment is also an uncontrollable factor that affects the marketing environment.
Political and legal intervention in the field of marketing and business activities has now become a common factor.
Monetary and fiscal policies, import and export policies and custom duties, etc. affect the Marketing System of a country.
In the case of India, price and supply regulation of products like iron, steel, cement, and drugs, etc. has often been resorted to by the government.
The range of government legislation directed at protecting consumer interest and the organization of the consumer’s resistance groups have affected the marketing environment considerably, such as Monopoly and Preventive Trade Practices Act.
The managers should keep public policy in mind while preparing managers plans, policies, and strategies.
5. Scientific and Technological Environment
The scientific and technological environment also affects the marketing environment of a country.
For example, there is a considerable change in the living style and the pattern of consumption on account of the development of scientific and technological environment.
These are an absolute change in the living standards of developed and developing countries.
The scientific and technological developments have given birth to new marketing opportunities, such as the computer industry.
The existence of competition in the market is essential for building a strong market of particularly in the case of a democratic society.
In the free market economy, it is not possible to take any marketing decision without evaluating the existence of competition.
In such an economy, the marketing manager has no control over competitors activities. However, the marketing manager should study the prevailing competitive conditions in the market.
For this purpose, He should take into account the basis of competition, competitors viewpoint towards the consumers, quality, and characteristics of competitors products and their marketing strategies before preparing the marketing plans.
7. Consumer Demand
Consumer demand is always changing and hence it is not possible to assess it correctly.
Thus, it is also an uncontrollable marketing environment. It affects the overall market environment.
Under the modern consumer-oriented Marketing concept, the consumer is the center of marketing activities.
Hence, the marketing manager must study the needs, preferences, and tastes of the products vis a vis consumers’ needs and thereby produce and market the products accordingly.
Every business, in order to survive and grow, must serve the needs of consumers and citizens.
8. Ecology or Nature or Physical Environment
In modern economics, Ecology or nature of the physical environment also occupying an important place in the field of distribution and marketing under the concept of intensive marketing.
However, it is also an uncontrollable factor in the marketing environment. Pollution has now become the topic of the day in the field of consumption economic system in developed and developing countries.
Today the marketer is not only required to satisfy the needs of his consumers but also the needs of the society as a whole.
Hence, his marketing activities should be directed in such a way that it may not harm the interests of society.
In order to maintain balance in the physical environment, it is essential that all types of pollution should be stopped and efficient utilization of the Limited valuable resources should be done.
Proper attention should be paid to the economic and efficient utilization of energy and physical resources.
9. Corporate Resources
Corporate resources include man, material, money, management, ideas, and information, locating research and development programs and public image, etc.
They are the constraints or limitations on the Expectations of marketing opportunities.
They affect the marketing environment of a company considerably. Company’s marketing opportunities depend on the availability of corporate resources.
These should be a happy marriage between the corporate resources and corporate opportunities so that the company can accomplish the set goals.
10. Marketing Mix
The policies adopted by manufacturers to attain success in the market constitute the marketing mix. Under marketing with we include mainly product mix, distribution mix, communication mix, and service mix.
The marketing mix is an important part of the Marketing System of the company and thus it is a controllable factor of the marketing environment. These controllable factors are marketing instruments or variables.
A company can achieve its marketing objectives by selecting and balancing the marketing mix. Marketing mix acts as a stimulus and resulting variables such as consumer satisfaction, marketing share, return on investment and company images responses.
A successful marketing strategy must have a marketing mix.
The study of changes in the marketing environment is of vital importance for the marketing manager of a company. These changes can adversely affect the marketing activities of the company. Advanced Strategies for Building Maximum Customer Satisfaction.
Even the existence of the company in danger. Changes in the economic and social environment, changes in the consumer preferences, changes in the strategies of the competitor, changes in the technology, etc. are such environmental changes which affect the marketing operations of the company considerably.
Hence, it is essential on the part of the marketing manager of a company to take timely steps in meeting these environmental changes.
The major steps are as follows:
1. To Anticipate Changes
The Marketing manager should anticipate the environmental changes when in advance.
If the Marketing manager is aware of the environmental changes, then he can face them easily by making necessary adjustments in time.
The marketing plans, policies, and strategies should be quite flexible so that timely changes may be affected.
It is essential that advertising and sales promotion policies, planning policies, etc. should be quite flexible.
The marketing personnel should be quite progressive.
They should be aware of the latest changes they are taking place in various spheres. The research and development activities should be encouraged at all costs. It will make the adjustment the environmental changes easier and convenient too.
Thus, now you know the factors affecting marketing environment.