MARKETING

ENVIRONMENT
ENVIRONMENT
Environment literally means the surroundings ,
external objects, influences or circumstances
under which someone or something exists. The
environment of an organization is the aggregate
of all conditions, events and influences that
surrounds and affects it. Since the environment
influences an organization in many ways, its
understanding is of crucial importance.
MARKETING ENVIRONMENT
According to Philip Kotler, “Marketing
environment refers to the external factors
or forces that affect the company’s ability to
develop and maintain successful
relationship with its target customers”.
MARKETING ENVIRONMENT
Marketing Environment consists of two
components:
Internal Environment(Controllable)
External
Environment(Uncontrollable)
External

Micro Macro
 ORGANISATION’S
INTERNAL Environment
RESEARCH
FINANCE AND
DEVELOPMENT

PURCHASE

Production
MARKETING
Human
Resource
External Environment
 MICRO
ENVIRONMENT
It refers to the company’s immediate environment i.e.
those environmental factors that are in its proximity.
These factors affect the company’s prospects directly.
Micro environmental factors are as under:
 FACTORS OF MICRO
ENVIRONMENT
❖ Suppliers : The suppliers to a firm provide
resources that are needed by that firm and thereby
alter its competitive positionand marketing
capabilities. There are raw material suppliers, energy
suppliers, suppliers of labour and capital etc.
❖ Intermediaries: Market intermediaries are
business houses or individuals who come to the aid of
the company. They are middlemen (wholesalers,
retailers), distributing agencies etc.
 PRODUCER CONSUMER

PRODUCER WHOLESALER CONSUMER

PRODUCE WHOLESALE RETAIL CONSUME

R R ER R
❖Customers: The customers of a company
may be of five types:
1. Ultimate customers
2. Industrial customers
3. Resellers
4. Government and other non- profit
customers
5. International customers
❖Competitors: Competitors are those who sell the goods and services of similar description in the same
market. Identification of competitors is of utmost importance. Therefore it is essential to build an
efficient system of marketing.Michael porter has identified the five forces of competition for a firm.
❖Public: A public is defined as “any group that has an actual or potential
interest in or impact on a company’s ability to achieve its objectives”. To
build goodwill and to seek favourable response, it is very crucial for a
company to satisfy its general public as well.

Financial public
Media public
Government Public
Local public
MACRO ENVIRONMENT
Macro environment refers to those factors
which are external forces in the company’s
activities and do not concern the immediate
environment. These are uncontrollable
factors which indirectly affect the concern’s
ability to operate in the market effectively.
 Macro
environment
Natural/Physical Economic

MACRO Political-leg
Technological
al

Socio-cultural Demographic
SOCIAL
FACTORS OF MACRO
ENVIRONMENT
Demographic factors
Economic factors
Physical factors
Technological factors
Political and legal factors
Soci0- cultural factors
❖Demographic factors: Demography is
the study of population in terms of size,
density, location, age, gender, occupation
etc. These factors have a huge impact on the
marketing decisions of the company.
For example, a growth in population means
increasing human needs which results in
the expansion of product markets, if there
is sufficient purchasing power.
❖Economic factors: It consists of factors related to
the means of production and distribution of wealth that
have an impact on the functioning of an organisation. It
affects the spending power of people. Further economic
development and growth affects the product choice of
the customers. For example- per capita income, Balance
of payment position, Gross national product, inflation,
deflation etc.
❖Physical factors: Components of physical
forces are the earth’s natural renewable and
non renewable resources. Natural renewable
resources are forests, food products from
agriculture or sea. Non renewable resources
are finite such as oil, coal, minerals etc. both
these components often change the level and
type of resources available to a marketer for
his production.
❖Technological factors: Advances in technology
are an important uncontrollable environment for
marketers in two ways: First, they are totally
unpredictable; and secondly, the adoption of new
technology is often prevented by constraints
imposed by internal and external resources. It is a
source of new and better products. For example
advancement in communication and infrastructural
technology- electronic marketing, video
conferencing etc.
❖Political and legal factors: These
factors include the policies related to public
sector, small scale industries, sick industries,
import and export, licensing, development of
backward areas etc. the vast governmental
network of laws and regulations have varied
impact on marketing activities.
❖Soci0- Cultural factors: It comprises of
society and culture. A society is a set of relations
among people including their social status and
roles. Culture consists of attitudes, customs, beliefs
and values of a society.

SOCIO-
CULTUR
A L

SOCIET CULTU
Y R E
THANK YOU