4.External marketing environment

External factors , these include

Macro factor and micro factors. Macro factors are the one that affect the organization indirectly, these are (pestel)

• Political

• enviroment

• socia-cultural

• technological and

• Ecological

• leagal

while micro factors are those which affect the organization directly it involve

• customers

• competitors

• suppliers and

• public

5.Macro environment

The Macroenvironment consist of the larger societal forces that affect the macro environment-demographics, economic, natural , technological, political, & cultural forces.

The economic environment includes those factors that affect consumer purchasing power and spending patterns.

There are six major forces in the company’s

Macroenvironment:

• Demographic.

1) It is of major interest to marketers because it involves people and people make up markets.

2) 1)The world’s population (though not all countries)rate is growing at an explosive rate that will soon exceed food supply and ability to adequately service the population. The greatest danger is in the poorest countries where poverty contributes to the difficulties.

3) The most important trend is the changing age structure of the population. life expectancy is increasing.

4) Baby boomers following World War II have produced a huge bulge´ in our population’s age distribution. The new prime market is the middle age group

• Economic.

1)The economic environment includes those factors that affect consumer purchasing power and spending patterns.Personal consumption has gone up (2000s) and the world economic crises of 2008 brought recession that has caused adjustments both personally and corporately in this country.

2)Today, consumers are more careful shoppers

• Natural.

1) Shortages of raw materials.

Resourses such as air, water, and wood products have been seriously damaged and non-renewable such as oil, coal, and various minerals have been seriously depleted during industrial expansion.

2) Increased pollution is a worldwide problem. Industrial damage to the environment is very serious. However, lack of adequate funding, especially in third world countries, is a major barrier.

3)Natural Environment involves natural resources that are needed as inputs by marketers or that are affected by marketing activities. During the past two decades environmental concerns have steadily grown.

4)Government intervention in natural resource management has caused environmental concerns to be more practical and necessary in business and industry. Leadership, not punishment, seems to be the best policy for long-term results. Instead of opposing regulation, marketers should help develop solutions to the material and energy problems facing the world.

5)Environmentally sustainable strategies. The so-called green movement has encouraged or even demanded that firms produce strategies that are not only environmentally friendly but are also environmentally proactive. Firms are beginning to recognize the link between a healthy economy and a healthy environment.

• Technological.

1)The technological environment includes forces that create new technologies, creating new product and market opportunities.

2)Technology is perhaps the most dramatic force shaping our destiny.

3)New technologies create new markets and opportunities.

4)Faster pace of technological change. Products are being technologically outdated at a rapid pace.

5)There seems to be almost unlimited opportunities being developed daily.

• Political.

1)The political environment includes laws, government agencies, and pressure groups that influence and limit various organizations and individuals in a given society. Various forms of legislation regulate business.

2)Governments develop public policy to guide commerce -sets of laws and regulations limiting business for the good of society as a whole.

3)Almost every marketing activity is subject to a wide range of laws and regulations.

• Cultural.

1)People’s views of themselves.

People vary in their emphasis on serving themselves versus serving others.

In the 1980s, personal ambition and materialism increased dramatically, with significant implications for marketing. The leisure industry was a chief beneficiary.

2)People’s views of others.

Observers have noted a shift from a “me-society” to a “we-society”.

Consumers are spending more on products and services that will improve their lives rather than their image.

3)People’s views of organizations.

People are willing to work for large organizations but expect them to become increasingly socially responsible. Many companies are linking themselves to worthwhile causes. Honesty in appeals is a must.

7.Micro environment

The Microenvironment consist of the factors close to the company that affect the ability to serve its customers the company, suppliers, marketing intermediaries, customer markets, competitors , & publics.

The microenvironment consists of five components.

• The first is the organization’s internal environment its

several departments and management levels as it affects

marketing management's decision making.

• The second component includes the marketing channel firms that cooperate to create value: the suppliers and marketing intermediaries(middlemen, physical distribution firms, marketing-service agencies, financial intermediaries).

• The third component consists of the five types of markets in which the organization can sell: the consumer, producer, reseller, government, and international markets.

• The fourth component consists of the competitors facing the organization.

• The fifth component consists of all the publics that have an actual or potential interest in or impact on the organization’s ability to achieve its objectives: financial, media, government, citizen action, and local, general, and internal publics.

The microenvironment consists of six forces close to the company that affect its ability to serve its customers.

This includes all the elements existing within the company’s paradigm.

• The Company

a) Top management is responsible for setting the company’s mission objectives, broad strategies, and policies.

b) Marketing managers must make decisions within the parameters established by top management.

c) All departments must think about consumer if the firm is to be successful. The goal is to provide superior customer value and satisfaction.

• Suppliers

a)Suppliers are firms and individuals that provide the resources needed by the company and its competitors to produce goods and services. They are an important link in the company’s overall customer value delivery system.

b)One consideration is to watch supply availability (such as supply shortages).

Another point of concern is the monitoring of price trends of key inputs. Rising supply costs must be carefully monitored

• Marketing Intermediaries

a)Resellers are distribution channel firms that help the company find customers or make sales to them. However, seeking and working with resellers is not easy because of the power that some demand and use.

b)Physical distribution firms help the company to stock and move goods from their points of origin to their destinations.

c) Marketing service agencies (such as marketing research firms, advertising agencies, media firms, etc.) help the company target and promote its products.

d) Financial intermediaries (such as banks, credit companies, insurance companies, etc.) help finance transactions and insure against risks

• Customers

a)Consumer markets (individuals and households that buy goods and services for personal consumption).

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

c)Reseller markets (buy goods and services in order to resell them at a profit).

d)Government markets (agencies that buy goods and services in order to produce public services or transfer them to those that need them).

e)International markets (buyers of all types in foreign countries).

• Public and Many Other Stakeholders

a)Financial publics -influence the company’s ability to obtain funds.

b)Media publics -carry news, features, and editorial opinion.

c)Government publics -take developments into account.

d)Citizen-action publics -a company’s decisions are often questioned by consumer organizations.

e)Local publics -includes neighborhood residents and community organizations.

f)General publics - a company must be concerned about the general public’s attitude toward its products and services.

g)Internal publics -workers, managers, volunteers and the board of directors.

Competitors

a)Every company faces a wide range of competitors.

b)A company must secure a strategic advantage over competitors by positioning their offerings to be successful in the marketplace.

c)No single competitive strategy is best for all companies.