Micro Environment

• Suppliers
• Marketing Intermediaries
• Customers

THE MARKETING
ENVIRONMENT

TARGET

societ

y

technnolog

y

re

g

u

la

ti

on

p

o

li

ti

c

s

natu

r

e

economic

s

compet

ition

PRICE

PRODUC
T

PROMOTIONPLACE

Environmental scanning

The process of gathering data on

the marketing environment from
people and publication

Approaches to the Marketing

Environment

Reactive marketing the marketers

views

environmental forces as uncontrollable
and

try to adjust to them

Proactive marketing Organization
takes

steps to change the marketing
environment so

that it will be more conducive to their

needs

Whether reactive or proactive
marketers

always face controllable and

uncontrollable

environmental elements

Controlla
ble

Product mix

Pricing

Distribution

Promotion

Uncontrolla
ble

Exchange rates

Consumer
tastes

Political shifts

Elements of the marketing Environment

Competitive elements

rivalry among marketers

approaching the

same set of

customers

Types of competition

Direct
competiti
on
between
marketer
s of
similar
products

Products
can be

substitut
ed

Marketers
of
dissimilar
goods and
service

Competitive structure of

markets

– Monopoly
– Duopoly
– Oligopoly
– Pure competition an ideal competitive

structure in which many marketers compete
to sell the same undifferentiated product

Economic elements

Factors in the marketing environment
that are shaped by or are part of the
economic climate :

consumer wealth
buying power
income

Indicators of buying power

• Disposable income
• Discretionary income
• Credit
• Wealth (accumulated financial resources)
• Willingness to spend

Buying power and willingness to pay are a
ffected by the business cycle

The business cycle

A pattern of economic fluctuations which

includes 4 scenarios

prosperit
y

recession

depressi
on

recovery

Prosperity

Consumers enjoy high

income,

willingness to spend and low

unemployment

Recession

Unemployment rises and

consumer

buying power drops

Depression

A more intense form of recession in

which unemployment peaks buying
power drops dramatically and
consumers lose faith

Recovery

economy moves from depression

or

recession toward prosperity

NATURAL

ELEMENTS

WEATHER, NATURAL

RESOURCES, GEOLOGICAL

& ASTRONOMICAL EVENTS

Political
Elements

• domestic
• international

Regulatory
elements

specifically laws and regulations ,
that

govern pricing , distribution,
promotion and

product decisions

Technological
Elements

in all marketing mix activities

Social Elements

shifting demographics

roles of women and men

growing cultural diversity

changing values