Assessing the Marketing Environment

1. Assessing the Marketing Environment

2. The MACRO Environment • Identifies and measures the non-controllable elements of the environment that organisation must assess. • Organisations are assessing the trends in change as they might impact on them • MACRO environment is dynamic, it is always changing • PESTLE factors are the ones we are analysing

3. The Social Environment • Demography • How fast/slow is the population growing? • Is it an aging population? What is the ethnic make up? Level of immigration? • How is it changing? • Social Change • Divorce rates? Single parent and single families? • Working women? Rise in wealth of women? ‘New’ family units. • Impact of ‘new’ ethnic groups

4. The Social Environment • Culture • What are the core values in Society? What is their source? • Religion and thinkers are key to culture • Education, language, Aesthetics. • Family background, sub-cultures, reference groups • Social responsibility • As a society we are becoming more concerned with business behaving in an ethical manner and looking after the environment

5. The Economic Environment • Economic indicators • Interest rates • Inflation • Growth (GDP) • Unemployment • International trade (surplus) • Personal debt • Exchange rates • The Business (Economic) cycle

6. The Political Environment • Governments • Pass laws • Set levels of tax • Shape behavioural standards, for example laws about smoking • Control the public sector • Take responsibility for International Trade

7. The Legal Environment • Government legislate • Consumer protection laws • Health and safety • Laws to protect intangible property • Patents • Trademarks

8. The Natural Environment • Environmental factors the public are concerned about • Reducing fossil fuel consumption • Re-cycling • Sustainable sources • Help workers down the supply chain • Ethical business behaviour

9. The Technological Environment • The speed as which new technology diffuses • The impact of technology on social change • The Internet (how do companies use it?) • Technology impacts on our effectiveness and efficiency at work

10. Corporate and Social Responsibility • Organisations accountability to society • Social values, consumers want to know more about the sources of their products • Fair trade • Cause related marketing

11. The MICRO Environment • Individuals and organisations that directly or indirectly impact on an organisation. They include: • Customers • Suppliers • Distributors • Shareholders • Competitors • Interest groups

12. Customers • How have/do their requirements change over time? • How do the MACRO environmental changes impact on customers? • How do suppliers products impact on customer? • Is the product/service always on time? • Happy employees makes for happy customers

13. Competitors • In the UK there are many laws to stop unfair competition. In particular mergers of large companies are strictly controlled • Anti-competitive agreements are prohibited • Trade bodies exist to enforce standards • Various regional trading bodies • World trade organisation

14. Analysing Competitors • We need to know: • What the competitor says about itself • What people say about them • Their Strengths and Weakness • Their tactics • Their product/service offering • How our company compares

15. The Internal Environment • It is about understanding what the company is capable of and what it does best (core competencies). They come in various forms in the UK: • Sole trader • Partnerships • Limited company • Francises

16. Internal Culture • Motivating staff • Rewarding staff • The degree of formality at work • How should staff behave • Degree and expectations of team working • Structure and control inn the organisation

17. Corporate and Social Responsibility at the Business Level • Should business be responsible? Two views • No, business is only about making a profit so other people can spend money on social issues • Yes, business is responsible for all its stakeholders whether they directly generate income or not

18. Organisational Strengths and Weaknesses • Organisations are constrained by all the actors in their environment. However with globalisation new markets opens up. • Challenge for business in this new world order is to either: • Standardise or adapt their products and services for different markets • Are you a niche or mass marketer?

19. Measurement Methods • Qualitative • Soft data and opinion • Can help understand the reasons why • Quantitative • Hard data and measurement • Mathematical models • Can help understand the what

20. Organisational Objectives • Objectives are hierarchical and should be SMART • Organisation mission and purpose • Organisation aims • Organisation objectives • Marketing objectives

21. Auditing Tools • Internal (5M’s) • Money, Manpower, Marketing, Materials, Machinery • MICRO • Porters 5 Forces for structure of competition • MACRO • PEST, PESTLE

22. SWOT • Pulls together the strands of the analysis • Strengths-what the organisation is good at • Weaknesses-Internal areas to improve • Opportunities-external factors that can help the organisation improve • Threats-external factors beyond the organisations control that could put it at risk