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Marketing Environment, Essay Example

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Introduction

In this paper we are going to look at the term market environment that relates to what we learned in class and some of the definitions of the terms that are related to it. The term market environment refers to the outside forces of the market that affects the ability of the market management to maintain a relationship which is successful with the targeted customers. The environment comprises of the macro environment and the microenvironment marketing.

The microenvironment comprises of the suppliers, the intermediaries of marketing, the competitors, the public, the customer markets and the company itself. These forces are always close to the company and mostly it affects its capability of serving the customers. The suppliers are also a significant factor of the microenvironment since any small delay of the service results to the dissatisfaction of the company’s customer. Another very important aspect of microenvironment is the customers that include the individuals like the business markets. They purchase the goods and services, which they later transform them into their own products and resell them to the market. Competitors as well lands on this category and they are essential since they offer competition within the market. The final factor of the microenvironment is the public. It comprises of the individual that has an impact or interest in the company’s ability to meet its objectives. On the other hand, the macro environment includes all the forces that are found on the larger society and mostly they put their effects on the microenvironment. It includes issues such as the demography which comprises of the study of human population in consideration to location, density, size and the age.

It also includes of the economic environment that considers the power of purchasing the potential customers and way they spend their income. Natural environment is also one of them, which includes the natural resources that a company might use as the input to have the effect on their marketing activities. It also comprises of the technological environment, political environment that includes things like the laws while the last one is the cultural environment, which consists of the beliefs and basic values of a certain group of people. Therefore, it is very important for the company to be extra active when it comes to the marketing environment. This is to create a kind of environment that they will live to prosper in the markets with the largest potential of customers.

To understand it better, the paper puts into a consideration the Tourism Industry and the types of its marketing mix. While tourism is influenced by a number of factors, these factors actually influence the revenues accruing to the given tourist destination country. In order to ensure that a country gets the optimal income from tourism, it is important for the specific tourist destination to know the relationship that exists between and among the various factors in the industry. We have several types of the marketing mix, but let us look at a few of them that fall under the tourism industry.

One of them is the Price, whereby they can use several ways of pricing the industry. Place is also another element which is a mechanism through which the services are moved from the industry to the consumer, who is a tourist in this case. The third one is the promotion that comprises of the necessary tools that a marketer may use for the marketing communication. The fourth one is the People or the tourists, who are the most significant of any service or experience.

 Work Cited

Phillip, Kotler, and Armstrong, Gary. Principles of Marketing (Version 12/E). Pearson Education Inc. New Jersey. (2006).

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9.8 The Marketing Environment

Learning objectives.

• Describe the external marketing environment in which businesses operate.
• Discuss the factors that influence consumer behavior.

By and large, managers can control the four Ps of the marketing mix: they can decide which products to offer, what prices to charge for them, how to distribute them, and how to reach target audiences. Unfortunately, there are other forces at work in the marketing world—forces over which marketers have much less control. These forces make up a company’s external marketing environment , which, as you can see in Figure 9.14 “The Marketing Environment” , we can divide into five sets of factors:

• Political and regulatory
• Competitive
• Technological
• Social and cultural

Figure 9.14 The Marketing Environment

These factors—and changes in them—present both threats and opportunities that require shifts in marketing plans. To spot trends and other signals that conditions may be in flux, marketers must continually monitor the environment in which their companies operate. To get a better idea of how they affect a firm’s marketing activities, let’s look at each of the five areas of the external environment.

The Political and Regulatory Environment

Federal, state, and local bodies can set rules or restrictions on the conduct of businesses. The purpose of regulation is to protect both consumers and businesses. Businesses favor some regulations (such as patent laws) while chafing under others (such as restrictions on advertising). The tobacco industry, for example, has had to learn to live with a federal ban on TV and radio advertising. More recently, many companies in the food industry have expressed unhappiness over regulations requiring the labeling of trans-fat content. The broadcasting industry is increasingly concerned about fines being imposed by the Federal Communications Commission for offenses against “standards of decency.” The loudest outcry probably came from telemarketers in response to the establishment of “do-not-call” registries.

All these actions occasioned changes in the marketing strategies of affected companies. Tobacco companies rerouted advertising dollars from TV to print media. Food companies reduced trans-fat levels and began targeting health-conscious consumers. Talent coordinators posted red flags next to the names of Janet Jackson (of the now-famous malfunctioning costume) and other performers. The telemarketing industry fired workers and scrambled to reinvent its entire business model.

The Economic Environment

Every day, marketing managers face a barrage of economic news. They must digest it, assess its impact, and alter marketing plans accordingly. Sometimes (but not recently), the news is cause for optimism—the economy’s improving, unemployment’s declining, consumer confidence is up. At other times (like today), the news makes them nervous—our economy is weak, industrial production is down, jobless claims are rising, consumer confidence has plummeted, credit is hard to get. Naturally, business thrives when the economy is growing, employment is full, and prices are stable. Marketing products is easier because consumers are willing to buy. On the other hand, when the economy is slowing (or stalled) and unemployment is rising, people have less money to spend, and the marketer’s job is harder.

Then there’s inflation, which pushes interest rates upward. If you’re trying to sell cars, you know that people facing higher interest rates aren’t so anxious to take out car loans. Sales will slip, and to counteract the anticipated slowdown, you might have to add generous rebates to your promotional plans.

Moreover, if you operate in foreign markets, you can’t focus on solely domestic economic conditions: you have to monitor the economy in every region where you do business. For example, if you’re the marketing director for a U.S. company whose goods are manufactured in China and sold in Brazil, you’ll need to know as much as you can about the economies in three countries: the United States, China, and Brazil. For one thing, you’ll have to pay particular attention to fluctuations in exchange rates, because changes will affect both your sales and your profits.

The Competitive Environment

Imagine playing tennis without watching what your opponent was doing. Marketers who don’t pay attention to their competitors are playing a losing game. In particular, they need to monitor the activities of two groups of competitors: the makers of competing brands and the makers of substitute products. Coke and Pepsi, for instance, are brand competitors who have engaged in the so-called cola wars for decades. Each tries to capture market share by convincing people that its soft drinks are better. Because neither wants to lose share to the other, they tend to resort to similar tactics. In summer 2004, both companies came out with nearly identical new colas boasting half the sugar, half the calories, and half the carbohydrates of regular colas. Coke called its product Coke C2, while Pepsi named its competing brand PepsiEdge. Both companies targeted cola drinkers who want the flavor of a regular soda but fewer calories. (By the way, both products failed and were taken off the market.)

Meanwhile, Coke and Pepsi have to watch Nantucket Nectars, whose fruit drinks are substitute products. What if Nantucket Nectars managed to get its drinks into the soda machines at more fast-food restaurants? How would Coke and Pepsi respond? What if Nantucket Nectars, which markets an ice tea with caffeine, introduced an ice tea drink with mega amounts of caffeine? Would marketers at Coke and Pepsi take action? What if Nantucket Nectars launched a marketing campaign promoting the health benefits of fruit drinks over soda? Would Coke and Pepsi reply with campaigns of their own? Would they respond by introducing new non-cola products?

The Technological Environment

When’s the last time you rented a VHS tape of a new movie? If you had trouble finding it, that’s because DVDs are in and videotapes are out. Videotape makers who were monitoring technological trends in the industry would probably have taken steps to keep up (go into DVDs) or otherwise protect themselves from losses (maybe even getting out of the market). In addition to making old products obsolete, technological advances create new products. Where would we be without the cell phone, digital cameras, text messaging, LASIK surgery, and global positioning systems?

Figure 9.15

Web sites like iTunes and Amazon.com are now offering customers the option of downloading movies. Do you think DVDs will suffer the same fate as videocassettes?

Sergio Carrasco – Tecnologia Obsoleta – CC BY-SA 2.0.

New technologies also transform the marketing mix in another important way: they alter the way companies market their products. Consider the revolutionary changes brought about by the Internet, which offers marketers a new medium for promoting and selling a vast range of goods and services. Marketers must keep abreast of technological advances and adapt their strategies, both to take advantage of the opportunities and to ward off threats.

The Social and Cultural Environment

Marketers also have to stay tuned to social and cultural factors that can affect sales. The values and attitudes of American consumers are in a state of almost constant flux; what’s cool one year is out of style the next. Think about the clothes you wore five years ago: would you wear them today? A lot of people wouldn’t—they’re the wrong style, the wrong fit, the wrong material, the wrong color, or just plain wrong. Now put yourself in the place of a marketer for a clothing company that targets teenagers and young adults. You wouldn’t survive if you tried to sell the same styles every year. As we said at the outset of this chapter, the key to successful marketing is meeting the needs of customers. This means knowing what they want right now, not last year.

Here’s another illustration. The last few decades have witnessed monumental shifts in the makeup of the American workforce. The number of women at all levels has increased significantly, the workforce has become more diverse, and telecommuting is more common. More people place more importance on balancing their work lives with the rest of their lives, and fewer people are willing to sacrifice their health to the demands of hectic work schedules. With these changes have come new marketing opportunities. As women spend more time at work, the traditional duties of the “homemaker” have shifted to day-care centers, nannies, house-cleaning services, and (for those who can afford them) child chauffeurs, birthday-party coordinators, and even family-photo assemblers (Loh, 2003). The number of gyms has mushroomed, the selection of home office furniture has expanded, and McDonald’s has bowed to the wishes of the health-conscious by eliminating its “super-size” option.

Generation Gaps

Clothiers who target teens and young adults (such as Gap and Abercrombie & Fitch) must estimate the size of both current and future audiences. So must companies that specialize in products aimed at customers in other age brackets—say, young children or retirees. Marketers pay particular attention to population shifts because they can have dramatic effects on a consumer base, either increasing or decreasing the number of potential customers.

Marketers tend to assign most Americans born in the last sixty years to one of three groups: the baby-boom generation (those born between 1946 and 1964), Generation X (1965 to 1975), and Generation Y—also known as “echo baby boomers” or “millenniums” (1976 to 2001) (Sincavage, 2004). In addition to age, members of each group tend to share common experiences, values, and attitudes that stay with them as they mature. These values and attitudes have a profound effect on both the products they want and the marketing efforts designed to sell products to them. Let’s look a little more closely at some of the defining characteristics of each group.

Baby Boomers

The huge wave of baby boomers began arriving in 1946, following World War II, and marketers have been catering to them ever since. What are they like? Sociologists have attributed to them such characteristics as “individuality, tolerance, and self-absorption” (Leo, 2003). There are seventy million of them (Neuborne & Kerwin, 2006), and as they marched through life over the course of five decades, marketers crowded the roadside to supply them with toys, clothes, cars, homes, and appliances—whatever they needed at the time. They’re still a major marketing force, but their needs have changed: they’re now the target market for Botox, pharmaceutical products, knee surgery, financial investments, cruises, vacation homes, and retirement communities.

Generation X

Because birth rates had declined by the time the “Gen X” babies first arrived in 1965, this group had just one decade to grow its numbers. Thus, it’s considerably smaller (seventeen million (Neuborne & Kerwin, 1999)) than the baby-boomer group, and it has also borne the brunt of rising divorce rates and the arrival of AIDS. Experts say, however, that they’re diverse, savvy, and pragmatic (Neuborne & Kerwin, 1999) and point out that even though they were once thought of as “slackers,” they actually tend to be self-reliant and successful. At this point in their lives, most are at their peak earning power and affluent enough to make marketers stand up and take notice.

Generation Y

When they became parents, baby boomers delivered a group to rival their own. Born between 1976 and 2001, their sixty million (Neuborn & Kerwin, 1999) children are sometimes called “echo boomers” (because their population boom is a reverberation of the baby boom). They’re still evolving, but they’ve already been assigned some attributes: they’re committed to integrity and honesty, family oriented and close to parents, ethnically diverse and accepting of differences, upbeat and optimistic about the future (although the troubled economy is lessening their optimism), education focused, independent, and goal oriented (Neuborne & Kerwin, 1999; Richardson, 2002; Fernandez-Cruz, 2006). They also seem to be coping fairly well: among today’s teens, arrests, drug use, drunk driving, and school dropout rates are all down (Tulgan & Martin, 2001).

Generation Ys are being courted by carmakers. Global car manufacturers have launched a number of 2012 cars designed to cater to the members of Generation Y (Brauer, 2011). Advertisers are also busy trying to find innovative ways to reach this group, but they’re finding that it’s not easy. Generation Ys grew up with computers and other modes of high technology, and they’re used to doing several things at once—simultaneously watching TV, texting, and playing games on the computer. As a result, they’re quite adept at tuning out ads. Try to reach them through TV ads and they’ll channel-surf right past them or hit their TiVo remotes (Bianco, 2004). You can’t get to them over the Internet because they know all about pop-up blockers. In one desperate attempt to get their attention, an advertiser paid college students fifty cents to view thirty-second ads on their computers (Baker, 2004). Advertisers keep trying, because Generation Y is big enough to wreck a brand by giving it a cold shoulder.

Consumer Behavior

Why did you buy an Apple computer when your friend bought a Dell PC? What information did you collect before making the decision? What factors did you consider when evaluating alternatives? How did you make your final choice? Were you happy with your decision? To design effective strategies, marketers need to find the answers that consumers give to questions such as these. In other words, they try to improve their understanding of consumer behavior —the decision process that individuals go through when purchasing or using products. In Section 9.8.7 “The Buying Process” , we’ll look at the process that buyers go through in choosing one product over another. Then, we’ll explore some factors that influence consumers’ behavior.

The Buying Process

Generally speaking, buyers run through a series of steps in deciding whether to purchase a particular product. Some purchases are made without much thought. You probably don’t think much, for example, about the brand of gasoline you put in your car; you just stop at the most convenient place. Other purchases, however, require considerable thought. For example, you probably spent a lot of time deciding which college to attend. Let’s revisit that decision as a means of examining the five steps that are involved in the consumer buying process and that are summarized in Figure 9.16 “The Buying Process” : need recognition, information search, evaluation, purchase , and postpurchase evaluation .

Figure 9.16 The Buying Process

• Need recognition . The process began when you recognized a need to go to college. Perhaps you wanted to prepare for a particular career, to become better educated, or to postpone going to work full time. Maybe your parents insisted.
• Information search . Once you recognized the need to go to college, you probably started gathering information about colleges. You may have gone online and studied the Web sites posted by a few schools. Perhaps you attended college fairs or spoke with your high school guidance counselor. You probably talked with friends about your options. Once you let colleges know that you were interested, admissions departments likely sent you tons of information.
• Evaluation . At this point, you studied the information you’d gathered. First, you probably decided what you wanted from a college. Perhaps price was your number-one criterion, or maybe distance from home. Maybe size was important, or reputation or available majors. Maybe it was the quality of the football team or the male-to-female ratio.
• Purchase . Ultimately you made a “purchase” decision. In so doing, you focused on what was most important to you. Naturally, you could choose only among schools that had accepted you.
• Postpurchase evaluation . The buying process didn’t end when you selected a school. It continues today, while you’re using the “product” you purchased. How many times have you rethought your decision? Are you happy with it? Would you make the same choice again?

Understanding the buying process of potential students is crucial to college administrators in developing marketing strategies to attract qualified “buyers.” They’d certainly like to know what information you found useful, which factors most influenced your decision, and how you made your final choice. They’ll also want to know whether you’re happy with your choice. This is the kind of information that colleges are seeking when they solicit feedback, both from students who chose their schools and from those who didn’t.

Influences on Buying Behavior

Did you ever buy something you knew you shouldn’t buy but just couldn’t help yourself—something you simply wanted? Maybe it was a spring-break trip to the Bahamas that you really couldn’t afford. Objectively, you may have made a bad decision, but not all decisions are made on a purely objective basis. Psychological and social influences come into play. Let’s take a closer look at each of these factors.

Psychological Influences

Under this category, we can identify at least five variables:

• Motivation . The internal process that causes you to seek certain goals.
• Perception . The way you select, organize, and interpret information.
• Learning . Knowledge gained through experience and study.
• Attitudes . Your predisposition to respond in particular ways because of learned values and beliefs.
• Personality . The collection of attributes that characterize an individual.

Social Influences

Here, we find four factors:

• Reference groups . Friends or other people with whom you identify.
• Economic or social status .
• Culture . Your set of accepted values.

It shouldn’t be surprising that marketers are keenly interested in the effect of all these influences on your buying decisions. For instance, suppose the travel agency that sold you your spring-break getaway found that you bought the package because you viewed it as a reward for studying hard and doing well academically. In that case, it might promote student summer-travel programs as rewards for a hard year’s work at school.

Key Takeaways

• A number of forces over which it has little or no control affect a company’s marketing activities.
• Taken together, they make up its external marketing environment , which includes regulatory and political activity, economic conditions, competitive forces, changes in technology, and social and cultural influences.
• Successful marketing often hinges on understanding consumer behavior —the decision process that individuals go through when purchasing or using products.
• Several psychological and social variables influence buyers’ decisions. They go through a series of steps in reaching the decision to buy a product: need recognition, information search, evaluation, purchase , and postpurchase evaluation .
• Shifts in the external marketing environment often necessitate changes in a company’s marketing plans. All companies are affected by external factors, but certain factors can have a stronger influence on particular products. Which of these five types of external factors—political/regulatory, economic, competitive, technological, social/cultural—would have the greatest impact on each of the following products: a Toll Brothers home, P&G Tide laundry detergent, Apple iPod, Pfizer heart medicine, and Gap jeans. In matching products with external factors, apply each factor only once. Be sure to explain exactly how a given factor might affect product sales.

Experts have ascribed a number of attributes to Generation Y—people born between 1976 and 2001. On a scale of 1 to 10 (with 10 being the highest), indicate the extent to which each of the following attributes applies to you:

Baker, S., “Channeling the Future,” BusinessWeek Online , July 12, 2004, http://www.businessweek.com/magazine/content/04_28/b3891013_mz001.htm (accessed October 21, 2011).

Bianco, A., “The Vanishing Mass Market,” Business Week , July 12, 2004, 61–68.

Brauer, K., “The Best Cars for Generation Y,” CNBC , http://www.cnbc.com/id/41172515/The_Best_Cars_for_Generation_Y (accessed October 21, 2011).

Fernandez-Cruz, M., “Advertising Agencies Target Generation Y,” youngmoney.com , http://www.youngmoney.com/lifestyles/campus_life/031202_01 (accessed May 21, 2006).

Leo, J., “The Good-News Generation,” U.S. News & World Report , November 3, 2003, http://www.usnews.com/usnews/opinion/articles/031103/3john.htm (accessed October 21, 2011).

Loh, S. T., “Nannyhood and Apple Pie,” The Atlantic , October 1, 2003, 122–23.

Neuborne, E., and Kathleen Kerwin, “Generation Y,” BusinessWeek Online , February 15, 1999, http://www.businessweek.com/1999/99_07/b3616001.htm (accessed May 21, 2006).

Richardson, K., “Zell Conference Reveals Next Marketing Wave,” Kellogg World (Kellogg School of Management, Northwestern University, Winter 2002), http://www.kellogg.northwestern.edu/kwo/win02/inbrief/zell.htm (accessed October 21, 2011)

Sincavage, J. R., “The Labor Force and Unemployment: Three Generations of Change,” Monthly Labor Review , June 2004, 34.

Tulgan, B., and Carolyn A. Martin, “Book Excerpt: Managing Generation Y —Part I,” BusinessWeek Online , September 28, 2001, http://www.businessweek.com/smallbiz/content/sep2001/sb20010928_113.htm (accessed October 21, 2011).

Exploring Business Copyright © 2016 by University of Minnesota is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License , except where otherwise noted.

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1.3 Factors Comprising and Affecting the Marketing Environment

Learning outcomes.

By the end of this section, you will be able to:

• 1 Define and describe the marketing environment.
• 2 Explain the components of the marketing environment.
• 3 Identify and describe the internal factors of the marketing environment.
• 4 List and describe the components of the micro- and macroenvironments.

The Marketing Environment Defined

Organizations don’t operate in a vacuum. They’re not self-contained, self-sufficient machines; rather, they are complex systems that require interaction with facets of both their internal and external environments in order to survive and prosper. In this section, we’re going to explore the internal and external factors that drive an organization’s marketing activities.

The marketing environment is comprised of both the external and internal factors and forces that influence an organization’s decision regarding its marketing activities. Some of these factors—internal factors— are within the control of the organization. Other factors—external factors—are outside the control of the organization. We’ll explore these in more depth below.

To illustrate this concept of internal and external factors and forces, think about your body as an organization. Your body is composed of several internal organs and systems, like your heart, lungs, and digestive system. These organs and systems function both independently and yet interdependently to keep your body going. The same is true with a business. The systems of the business are the people and departments that make up the internal organization (such as marketing, accounting, human resources, etc.). And just like the human body, these systems function independently and interdependently.

At the same time, your body is exposed to external influences, like expectations from your family and friends, cultural or gender stereotypes, and family responsibilities, that influence decision-making in either a positive or negative way. The same is true of the marketing activities of a business. They’re influenced by factors both from the macroenvironment and the microenvironment. Let’s take a closer look at these factors.

The Components of the Marketing Environment

As we’ll explore below, the internal environment is company-specific and includes the 5M framework and organizational culture. The external environment is subdivided into two components: the microenvironment (or task environment) and the macroenvironment (or broad environment), as illustrated in Figure 1.6

Components of the Internal Environment

The internal environment in marketing refers to those elements within the organization that define the atmosphere within the company’s structure. These factors include what’s known as the 5Ms of marketing and organizational culture.

The 5Ms of marketing (sometimes also called the 5M framework) is a marketing/management model that defines the elements of a marketing strategy that must be addressed in order to be successful. The five elements (sometimes known as the organization’s assets) include minds, minutes, machinery, materials, and money. 19 Let’s take a closer look at each of these factors:

• Minds (Staffing): This “M” might well be considered the most important factor because it’s people who make sure the rest of the 5Ms are utilized in a productive manner to achieve the goals of the organization. 20
• Minutes (Time): Time is another valuable asset. We’ve all heard the saying that time is money, and this is true within the marketing arena. For example, in formulating and implementing a new strategy, marketing needs to assess factors such as whether existing production processes are as efficient and effective as they can be, the length of time it takes the organization to introduce a new product to the market, and how responsive the organization is to competitive pressures. 21
• Machinery (Equipment): Machinery consists of the equipment and/or physical assets used to process materials into finished or semifinished products.
• Materials (Production): Materials consist of the inputs needed to produce goods and services.
• Money (Finance): Perhaps second only to staffing, money is a very critical resource because it’s used to acquire and/or hire other resources.

Organizational culture is comprised of the shared values, attitudes, expectations, norms, and practices that guide the actions of all within the company. Think about organizational culture as “the way we do things around here,” and the culture can help or hinder an organization. For example, a good culture embodies positive traits that lead to improved performance and profit. On the other hand, a dysfunctional culture that’s toxic and/or inefficient can hinder even the most successful organization. 22

For an example of a positive organizational culture, consider Zappos , where happiness is at the core. Founder Tony Hsieh wrote a book on the topic and has said, “We’re willing to give up short-term profits or revenue growth to make sure we have the best culture.” 23 Hsieh was not afraid to put his money where his mouth was, either. In support of maintaining an outstanding company culture and a productive workforce, he instituted a policy that would pay new, unhappy employees $2,000 to quit following their four-week training period. 24

By contrast, consider what a dysfunctional culture can do to an organization. During the summer of 2020, The Ellen DeGeneres Show was called out for having a toxic work environment. Eleven employees spoke out publicly about the negative organizational culture. There were allegations of sexual misconduct, intimidation, and racism. 25 Ratings faltered as a result of the allegations, and DeGeneres ultimately decided to end her daytime talk show.

But how does organizational culture impact marketing? Here are three very tangible ways that your company’s culture can make a positive impact on marketing:

• Branding and marketing efforts emanate from the organization’s core values and culture and guide the organization’s marketing message. Therefore, if your marketing message doesn’t match the reality of the business, it’s akin to that old adage of “putting lipstick on a pig.” 26 You’re talking the talk but not walking the walk.
• A strong culture strengthens your marketing message because it gives prospective customers a better idea of the values of your business, and customers who know what you believe and value are much more likely to do business with you. For example, research has demonstrated that 86 percent of buyers are willing to pay more for a positive customer service experience. 27 Once again, think about the culture at Zappos. One of the ways in which the company has developed a strong following of loyal customers is through its policy that call-center employees are empowered to do “whatever it takes” to make the customer happy. Call-center employees don’t use scripts for calls, and there are literally no time limits on calls. 28
• A strong organizational culture is also key in attracting and retaining employees. In his quest for a happier, more positive work environment, Hsieh implemented several policies at Zappos that he felt contributed to this environment, including a relaxed dress code, discounted food and drink, relaxation areas, and more. 29 TOMS (featured in Companies with a Conscience later in this chapter) is another excellent example of this.

Components of the External Environment

There are two elements within the external marketing environment: the microenvironment and the macroenvironment. Although the factors within these environments are not directly within the marketer’s control, they still influence the decisions made by marketers. We’ll first examine the factors in the microenvironment, as shown in Figure 1.7 .

The microenvironment consists of five predominant factors.

• Suppliers . Suppliers (sometimes also called vendors ) are those partners from whom we receive the parts and products necessary for our business. Let’s assume that your company produces microwave ovens. Some of your suppliers may be providers of transformers, the turntable, control panels, magnetrons, etc. As long as you have options in terms of the component suppliers, the bargaining power of each supplier is relatively weak. However, if two suppliers merge and decide to raise the price of the component the new entity supplies, that vendor now wields increased power.
• Market Intermediaries. Often, products are distributed by third-party sellers such as retailers, wholesalers, and others in the distribution channel. The reputation of these market intermediaries plays an important role in the marketing of the product or service, both positive and negative, so companies need to select and monitor market intermediaries on an ongoing basis. We’ll learn more about the roles of these intermediaries in Distribution: Delivering Customer Value , but let’s provide a couple of definitions and examples to help you better understand some of the parties in the distribution channel. Retailers (like Walmart or Target ) purchase large quantities of goods from producers and then sell smaller quantities to end customers for personal use or consumption. Wholesalers purchase large quantities of products from producers and then sell to smaller businesses such as retail stores. A good example of a wholesaler is Gexpro , which sells electrical supplies for the construction industry.
• Customers. Understanding who your customers are will enable you to effectively reach them, whether online, locally in retail stores, or internationally.
• Competitors. Successful marketing strategies must be implemented after consideration of your competition. Knowing who your competition is and what they are and are not offering allows you to find the gap in the market. You want to be where the competition is not, at least in the sense of offering something unique to a targeted market.
• General Public . Because companies provide their offerings in communities that support them, they have an obligation to satisfy those communities. There’s an old saying that “perception is reality,” so marketers’ actions must be evaluated through the perceptual lens of those communities, because the public’s perception of you—your reputation—is essential to your success. 30

Components of the Macroenvironment

Obviously, marketers can’t ignore what’s going on in the external environment. One of the tools used by companies to assess the environment in which they are operating is a PESTLE analysis . PESTLE is an acronym for political, economic, social, technological, legal, and environmental factors that provide marketers with a comprehensive view of the whole environment from multiple angles. 31 These macroenvironment factors can be used to understand current external influences so that marketers can more easily identify what might change in the future, mitigate the identified risks, and take advantage of competitive opportunities (see Figure 1.8 ).

Let’s look at these factors more closely:

• Political Factors. These factors include environmental and trade restrictions, political stability, and business policy. For example, Tesla announced in late 2021 that it is moving its headquarters out of California to Texas, following similar announcements by Hewlett Packard Enterprise (HPE) and Oracle , citing such things as lower housing costs and tax rates and fewer regulations, making it easier for companies to operate in Texas.
• Economic Factors. Economic factors play a huge role in terms of a company’s prospects in a market. For example, economic factors affect pricing and can even influence the supply/demand curve for a product or service. For example, high inflation causes consumers to have less spending power, which translates into lower sales and revenue. In 2022, consumers experienced both product shortages and higher prices, blamed largely on COVID-19, Russia’s war on Ukraine, and the availability of certain commodities, such as corn, sunflower oil, and wheat. 32
• Social Factors. Social factors take in a wide swath of elements, such as cultural norms and expectations, health consciousness, population growth/decline, the age distribution of a population, and even career attitudes. Let’s take one of these factors—age distribution—and examine how it impacts marketing. Baby boomers (born between 1946 and 1964) comprise approximately a quarter of the US population. It’s largely as a result of this group’s aging and retirement that active adult communities such as Del Webb and others have sprung up across the nation. 33
• Technological Factors. These factors encompass the innovations and developments in technology that impact an organization’s operations, as well as the rate of technological change. For example, look at one simple technological change with which we’ve all become comfortable in the public arena over the past decade or so: free WiFi. Starbucks was able to take advantage of this change and reposition its coffeehouses and differentiate itself from competitors by offering free WiFi. 34
• Legal Factors. These factors include changes to legislation impacting employment, industry regulation, licenses and permits, and intellectual property.
• Environmental Factors. In the context of a PESTLE analysis, environmental factors refer to variables affecting the physical environment, like climate change, pollution, the scarcity of raw materials, and the growing concern over companies’ carbon footprints.

Knowledge Check

It’s time to check your knowledge on the concepts presented in this section. Refer to the Answer Key at the end of the book for feedback.

• Market intermediaries
• the competition
• the customers
• the resellers
• Technological
• Political and legal
• Social and cultural
• Economic factors
• Natural factors
• Political and legal factors
• Social factors

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Marketing Environment Forces Essay

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Introduction

Economic forces, how can the marketer use economic odds to his advantage, competitive forces, how can marketers help in facing such forces, social-cultural forces.

Marketing environment is a term used to refer to the forces outside of marketing which have an influence on the marketing manager’s ability to create and maintain a healthy relationship with the customers he is targeting. In other words, these forces affect the demand and supply of goods and services. In this write up, focus is given on three marketing forces namely economic, competitive and socio-cultural forces.

These refer to prosperity, recession, depression and recovery life cycles and how they affect the consumption of a product. In any circumstance, what determines whether the consumer will use that product is whether he has the ability to purchase it. This makes economic factors key determinants or a key environmental force and the most fundamental force affecting marketing of a commodity.

Factors like employment, rate of inflation, interest rates, fiscal and monetary policies also fall under this category even though they are intricately intertwined and they eventually affect the business’ marketing activities by determining the amount of demand for the firm’s products (Franke, Hofstede & Bond, 1991).

Depending on how all the economic factors are addressed by the firm, they can be either an opportunity or a threat to the firm. For instance, discount stores and fast food points do better in a down economy as opposed to a vibrant and strong economy where people search for healthier foods.

Organizations will therefore need to review how economic conditions will impact on their businesses and respond appropriately. A successful marketer has to anticipate and visualize these economic factors and use them to his advantage. The focus is to get the maximum benefits at the minimum costs possible.

Often in such circumstances as downturns and recessions, there will be high unemployment, low purchasing power, and therefore low demand for products. The strategic marketer can plan to offer more value for the same or lower price than the competitor. He can increase advertising and utilize technology in cost reduction (Porter, 2008). The marketer will become a resource by providing information and tools which are needed by the prospects.

Before looking at the competitive forces themselves, it is important to understand the competitive structures. They include monopoly where there is only one marketer in the market place, oligopoly where there are few marketers- say three or four, perfect competition where competitors are of equal strength and equal access to market, and eventually monopolistic competition where there are many marketers.

The monopolistic competition is the most common and marketers have to work to ensure that consumers choose their commodities and not those of their competitors (Lee, 1966).

Michael E. Porter classified the forces into five categories, namely the intensity of competitive rivalry, the threat of new entrants, the threat of substitute products and the bargaining power of customers (Porter, 1979).

The intensity of rivalry is caused by a large number of firms competing for the same customers and resources, slow market growth that causes firms to fight for the market share, high fixed costs that cause the firms to produce at near capacity and high storage costs or high perishability that cause the producer to sell as soon as possible. Low switching cost where the customer can very easily switch, and low levels of product differentiation usually have the same impact on the marketing.

If the strategic stakes are high, they intensify rivalry. When there are high exit barriers, it is another way of saying that the firm must stay and compete. The diversity of rivals where it is very difficult to predict the behavior of rivals can mean that any time rivalry can intensify. Other factors on rivalry are level of advertising expense, competitive strategy of each and competition between online and also offline firms (Porter, 2008).

Porter’s second category is threat of substitutes. In this, reference is being given to products in other industries. Price elasticity is determined by substitute products. For instance, in the tire industry for cars, pricing may be constrained by the presence of retreads because they are substitutes.

There is therefore competition arising from substitutes as opposed to rivals. In simple terms the buyer’s propensity to switch to alternatives is an important consideration. It can be influenced by switching costs, product differentiation, number of substitutes available and relative price performance of the substitute (Porter, 2008).

Another force is the buyer power. Here the buyer is the reference and the one who determines the prices. For instance economists talk of monopsony when there are many sellers but only one buyer. In such a case, the buyer is the one who sets the price. Other issues affecting the buyer are buyer sensitivity to price, switching cost, information availability, degree of dependency on the current channels of distribution and buyer volume.

Supplier power is another competitive force. A supplier is said to be powerful when he can influence the producing industry. Suppliers are powerful when it is difficult for producers to switch suppliers and are weak when there are many competitive suppliers.

Threat of new entrants as a competitive force comes in especially when there are no barriers to entry in an industry. It is not very common especially if there are several well established firms. Other than presence of powerful firms other barriers to entry are government regulation, patents and proprietary knowledge and economies of scale.

When the firm is faced with some or all of these forces, the marketer can take both external and internal measures to jockey for a more favorable position. One of the things he/she can do is to understand the company’s strengths and weaknesses.

The company can choose to influence the balance before they negatively affect it. A company can devise a strategy that takes the offensive. This posture is designed to do more than merely cope with the forces themselves; it is meant to alter their causes instead.

The company can also exploit the changes in the industry through staking out a position that is less vulnerable to attack from head-to-head opponents, whether established or new, and less vulnerable to erosion from the direction of buyers, suppliers, and substitute goods (John & Steven, 1983). This it can do through solidifying good relationships with good customers through marketing and establishing technological leadership so as to be on the advantage of new changes.

These are societal factors that impact on any marketing aspect, either making it easier or challenging. They could relate to language, family, reference groups, roles and status, values and attitudes, religion, morals, education, prioritizing of wants current social trends and many more.

All these affect the preferences, perceptions and behavior. For instance, a company that focuses on exercise equipment and low calorie foods when there is a trend of weight loss is likely to sell more. Language for instance will influence the way an advertisement is perceived.

Some checklist questions a marketer can ask himself on the social cultural factors are: What is the dominant religion? How does the language of the customers influence the diffusion of the products? How much time do consumers create for leisure? What is the opinion and attitudes towards my type of product and also the company (Adler & Mortimer, 1981)?

These questions among many others will help a marketer know what issues to address, especially on the advertisement part. Advertisements are meant to create or change an impression among potential buyers. The marketer will therefore align his marketing strategies towards creating a lasting favorable impression among his potential clientele.

For instance on religion, the marketing department can promote products that show regard to the religious beliefs like banks that offer Sharia products for Muslims. Most firms try as much as they can to have products that will sell more to the bigger section of the society in regard to any social factor since it is difficult to offer a product that satisfies everybody.

The marketer should therefore be able to evaluate the quarters that will generate maximum revenue. When the marketing department works hand in hand with the production and other departments, they can create a product that gains favor among consumers while the marketing department creates brand loyalty through product promotion. The firm can take advantage of the socio-cultural factors in creating brand loyalty (Franke, Hofstede & Bond, 1991).

Marketers should perform a SWOT analysis to be able to understand their companies in terms of their abilities and weaknesses first before hitting the market for campaigns. In spite of all the unfavorable forces that are present in their business arena, they should struggle to use the forces to their advantage. However, before entering a market they should also conduct a PEST (political, economic, socio-cultural and technological) survey so that they understand the market and operate in a market they are sure to have less difficulties.

Adler, T. and Mortimer, J. (1981). Six great ideas. Journal of Marketing Management, 23 , 12-17.

Franke, R. H., Hofstede, G. and Bond M. H. (1991). Cultural roots of economic performance: A research note. Strategic Management Journal, 12 , 165-173.

John, R. H. and Steven, M. S. (1983). The indicators of a friendly market: Marketing Science, 2 (4), 319-360

Lee, J. A. (1966). Cultural analysis in overseas operations. Harvard Business Review, 44 (2), 106 114.

Porter, M. E. (1979). How competitive forces shape strategy. Harvard Business Review, 14 , 3-15.

Porter, M. E. (2008). The five competitive forces that shape strategy. Harvard business Review, 35 , 45-66.

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IvyPanda. (2018, December 27). Marketing Environment Forces. https://ivypanda.com/essays/marketing-environment-forces-2/

"Marketing Environment Forces." IvyPanda , 27 Dec. 2018, ivypanda.com/essays/marketing-environment-forces-2/.

IvyPanda . (2018) 'Marketing Environment Forces'. 27 December.

IvyPanda . 2018. "Marketing Environment Forces." December 27, 2018. https://ivypanda.com/essays/marketing-environment-forces-2/.

1. IvyPanda . "Marketing Environment Forces." December 27, 2018. https://ivypanda.com/essays/marketing-environment-forces-2/.

Bibliography

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Marketing91

Marketing Environment – Definition, Types, Importance and Examples

March 11, 2020 | By Hitesh Bhasin | Filed Under: Marketing

Various environmental factors affect the way a business is operated. These environmental factors can be divided into two broad categories, such as the internal environment and the external environment. A business is required to adapt to these marketing environments to stay profitable and ahead in the competition . In this article, you will learn about different types of marketing environments and various components of the marketing environment.

Table of Contents

The marketing environment can be defined as a combination of both internal environmental factors and external environmental factors. These marketing environments surround a business and influence the operations of the business.

What is the marketing environment?

A marketing environment is a combination of internal and external environmental forces and factors that influences the business operation of a business and its ability to serve its customers. It is essential to know both internal as well as external environmental factors. Therefore, enterprises keep checking on them to do their business without any legal trouble and to generate maximum profit.

The internal marketing environment consists of factors like material, machines, workers, money, etc. All of these components are necessary to run a business successfully. For example, if the raw material is not available on time and in sufficient quantity, then the work of production will become slow, and the company will not be able to fulfill the demand of the product in the market .

On the other hand, the external marketing environment can be divided into two categories, such as macro external marketing environment and micro external marketing environment. The microenvironment is closely related to the business and constitutes all external business activities such as distribution and promotion of products of the company.

The macro-environmental components affect all the companies serving in a single industry similarly. For example, changes in the laws and rules related to production or doing business will apply to all companies likely. In the next section, you will learn about all the internal as well as external components of an organization.

Components of the marketing environment

There are broadly two components of the marketing environment, such as the internal environment and external environment. Different types of parts of the marketing environment are categorized under these two broad categories.

The internal environment of a business can be controlled, but there is very little control of a business in the external marketing environment. Let us learn about both components one by one.

1. Internal environment

The internal environment is formed of all the internal factors and forces of an organization. The internal environment of an organization is within the control of the marketer, and he can change or modify the environment as per the demand in the market and requirement of the business.

The following are the five factors that form the internal environment of an organization. These factors are also referred to as five Ms of a business.

All the components of the internal environment are as important as that of the components of an external environment. However, the internal environment factors are changed according to the change in the external marketing components. For example, an organization is required to upgrade its technology if new technology in the market is introduced.

The internal environment of an organization also includes the marketing department, the sales department, the human resource department, and the manufacturing department.

2. External Marketing environment

The external marketing environment consists of all the external marketing factors that exist outside the organization, and the marketer has little or no control over the external marketing environment factors.

The external marketing environment can be divided into two categories, such as microenvironment and the macro environment .

Let us learn about both macro and micro environments one by one.

A. Microenvironment

The microenvironment of a business consists of all the factors and forces that are directly associated with the company. The micro components of the external environment are also known as task environments.

The following are the various components of the micro external environment.

1. Suppliers

Suppliers are an essential part of every organization. Suppliers supplies material and all other types of resources required for the production of products. A company can run its business successfully only if its suppliers supply material of good quality and on time.

2. Market intermediaries

Market intermediaries are the intermediary parties that help a business to distribute its products in the market. The market intermediaries can be wholesalers, retailers, and distributors. All of these market intermediaries are an essential part of the business as they are the face of the company in the market and represent the products of the company in the market.

3. Partners

Business partners are the business entities that conduct business with the organization. For example, advertising agencies, banking and insurance companies , market research organization s, brokers, and transportation companies, etc. A company is required to partner with several other companies to run a successful business.

4. Customers

Customers are the most crucial component of the business. Customers are the target audience of the product, and the preference of customers influences all the marketing and business efforts of a company.

The public is people other than the target audience of the organization. The public plays a vital role in the success of the business as it can build or destroy the image of a company in the market. The public has the power to influence the purchasing decision of the target audience. Especially in the times of the internet, the ability to control the public has increased as they can share their views about your products and services on the internet freely.

6. Competitors

The last but not least component of the microenvironment is the competitors of a business. The competitors are the other businesses that sell similar products as your products or are part of the same strategic group in the industry.

B. Macro Environment

Macro components of a marketing environment consist of all external forces and factors that impact the whole industry rather than just changing an organization directly. Therefore, the macro marketing environment is also referred to as a large environment.

The following are the six components of the macro environment. Let us learn about them one by one.

1. Technological environment

Technology is one of the elements that have great potential to influence the business of an organization. It is dynamic, as it changes rapidly. Technology provides several threats and opportunities to the business environment .

The technological environment consists of research and development in technology, innovation, inducement of technology, and technical alternatives, etc.

2. Demographic environment

The demographic environment component of the macro marketing environment consists of people that form a market. The population of the demographic environment can be characterized based on various factors such as age, gender, density, size, location, race, and occupation, etc.

The demographic environment is a crucial component for business as the company design and builds its products based on the characteristics of the demographic environment.

3. Social-cultural environment

The social-cultural component of a macro environment is formed using values, lifestyle, culture , beliefs, and prejudices of the target audience of a business. The social-cultural environment varies from one region to another region.

People living in one area might prefer a different type of product than the preference of the product of the people of any other region. Businesses are required to have in-depth knowledge of the social-cultural environment to design a product or service that is preferred by most people.

4. Economic environment

The economic environment component is a type of component that influences all industries. The economic environment affects the purchasing power and spending patterns of the buyers.

The following are the different factors that form an economic environment.

• Interest Rates.
• Gross Domestic Products (GDP).
• Gross National Product (GNP).
• Income distribution.
• Government funding.
• Other significant economic variables.

5. Political-legal environment:

The political-legal environment consists of laws and policies of a country. In addition to rules and procedures, the political-legal environment also includes agencies and pressure groups . All of these political entities impact the working capacity of the industry in society.

6. Physical environment:

The last component of the macro environment is the physical environment in which an organization exists. The following are the components of the physical environment.

• Climate condition
• Environmental change.
• Availability of the raw material.
• Natural resources like water.

Examples of the marketing environment

Examples of the internal marketing environment.

The best example of an internal marketing environment is the office culture of the organization. Your office culture consists of the values, beliefs, and attitudes of your employees . All of these factors determine how the employees of your organization will behave. For example, in an organization where employees are encouraged to perform in a team and support the members of the group are more likely to perform better than the organization where employees compete with one another.

Moreover, employees are likely to perform better in a positive internal marketing environment rather than an environment where employees are nagged continuously and pressured to perform well. Google is one of the best companies that provide a positive and very healthy internal environment to its employees. Because of this, Google is now one of the leading companies in the industry.

Examples of the external marketing environment

The external marketing environment of an organization is formed of micro and macro environment. The microenvironment consists of suppliers, market intermediaries, partners, customers, public, and competitors, etc. for example, suppliers of an organization alter the business environment of an organization to a certain extent. If suppliers supply good quality material and supply that material on time, then the organization can produce the right quality products and can fulfill the demand in the market efficiently.

Another vital component of the micro marketing environment is the market intermediaries. The market intermediaries of your business play an essential role in the success of your business. They are the face of your company. They interact with your customers daily and understand your customers and also your product. Let us take the example of a retailer. A retailer sells products from different companies in the market. It is in the hands of a retailer to decide whether to promote your product or not.

The sales of your products will significantly depend on the people who represent you in the market. Therefore, it is necessary to provide proper incentives to your representatives and provide a good margin to them on your products so that they promote your products to their customers rather than promoting the products of your competitors.

On the other hand, a macro marketing environment does not affect an organization directly but affects the whole industry. An organization is required to perform its business operations according to the macro-environment factors. The examples of the macro-environment are demographic environment, social-cultural environment, economic environment, political-legal environment, physical environment, and technological environment, etc.

The business operations of an organization are controlled by the laws and policies decided by the government. In addition to this, the technological environment influences the business environment more than any other macro-environment factor. A business is required to upgrade the technology that it uses for business operations from time to time in order to stay ahead in the competition.

The technological environment has both advantages and disadvantages for an organization as an organization is always required to think of innovation to compete with its competitors. On the other hand, it is also costly for an organization to update its technology regularly.

Importance of marketing environment

The marketing environment holds great importance when it comes to conducting business successfully. Businesses of all sizes, whether small or large or required to do their business within the marketing environment.

The existence of the company, its profits, and its losses largely depends on the internal as well as the external environment around it. Therefore, it becomes essential for a marketer to understand and study the marketing environment thoroughly to generate profits and stay in business for a more extended period.

Let us understand why the understanding and knowledge of the marketing environment is necessary to run a successful business.

1. To learn about your competitors:

A business needs to learn about its competitors to stay ahead in the competition. Different companies fight for a single opportunity in a niche market using different strategies .

A deeper understanding of the marketing environment helps a marketer to learn about the business strategies and plans of their competitors. Having this knowledge helps the marketers to understand the policy of their competitors and plan their business strategies accordingly.

2. To learn about your customers:

Customers are an essential part of a business. All the business activities of a company are focused on serving its customers better. Therefore, a company gives great importance to learn about their customers and their changing preferences to serve them better and to have a long relationship with them. The marketing environment helps the marketer to understand the customers and their preferences.

For example, when there is a slowdown in the economy and inflation is on the surge. At such times, people either prefer to spend less or cease their spending to save money.

Therefore, people look for goods and services at lower prices. Consequently, a company must either introduce new products with lower prices or sell their products at discounted prices so that they can still make sales when there is an economic slowdown.

3. Necessary for future planning

A business is required to plan to meet the demand of the market and produce as per the latest trends in the market. It is essential to learn about the internal and external environment to plan efficiently.

4. To make most out of the latest trends

Trends change rapidly, and the change is rapid in fashion and other similar industries. Companies that are part of such industries are required to keep a check on the changing trends. To do this, they learn about every aspect of the marketing environment so that they can prepare a foolproof plan for the future.

5. To learn about all the threats and opportunities related to business

Understanding the marketing environment is necessary to learn about the risks and opportunities associated with the company. The marketer can take advantage of being a first-mover if they know the opportunities related to the business. Moreover, a business must learn about the threat associated with the company to take precautions to stay safe.

Liked this post? Check out the complete series on Marketing

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• What is Internal Environment? Definition and Key Factors
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About Hitesh Bhasin

Hitesh Bhasin is the CEO of Marketing91 and has over a decade of experience in the marketing field. He is an accomplished author of thousands of insightful articles, including in-depth analyses of brands and companies. Holding an MBA in Marketing, Hitesh manages several offline ventures, where he applies all the concepts of Marketing that he writes about.

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A practical introduction to Marketing Environmental Analysis

The development of your overall marketing strategy has to start with an assessment of your business environment. In order to cover all bases, you can use a mix of several marketing frameworks. You can also use applied theories to evaluate different factors that affect your marketing strategy. So this is what marketing environmental analysis is all about. It can be broadly classified under external and internal factors. A marketing environmental analysis will highlight critical factors. You can use this to your advantage. But it also presents elements that are a risk to your planning and implementation.  

Before you look into the “How”, let’s establish the “Why”. The benefits of doing a marketing environmental analysis vary. Generally speaking, the analysis:

• helps in setting and attaining marketing or organizational objectives
• indicates internal strengths and weaknesses of the organization
• highlights external threats and opportunities
• provides an understanding of trends and insights to gain advantage or improve offering
• clarifies expectations by considering capabilities and resources
• prepares organizations for adversity and changes within their industry
• forecasts possibilities for the future of the offering, brand or organization

There are 2 widely accepted divisions to the marketing environmental analysis. External & Internal environments. The external is split into macro-environment and micro-environment forces. So, let’s take a deeper dive into each of the main classifications. We will be using some popular models and theories to explain them.

Macro-Environment – Marketing Environmental Analysis

The macro-environment factors are external forces indirectly affecting the growth of your business. These affect both the micro and internal factors. Thus, leaving an impact on your brand and organization. One of the most popular models for inspecting the macro-environment is a PESTLE/PESTEL analysis. PESTLE/PESTEL is a business analysis tool that is also useful for marketing strategy. There are 6 major elements to explore here. These are:

• Sociological
• Technological
• Environmental

By examining each of the 6 forces, you will have a clear understanding of external factors that provide opportunities for you, your brand, or your business. It will also prepare you to plan against threats and challenges.

Let’s look at each of the 6 factors of PESTLE/PESTEL now:

The political situation of the region/country you are marketing to needs to be considered. Most industries have regulations in place for trade, taxes, quality, and labor. These and other government policies make up the political external factors that affect you and your business.

The pricing of your offering could be severely affected by demand/supply imbalance. Thus, it is important to analyze economic factors. Some inclusions are direct like interest rates and inflation. There are complex ones too. Such as purchasing power of consumers or regional economic growth.

SOCIOLOGICAL

Also referred to as Social factors. These forces include but are not limited to, demographics by region, and general sentiment towards the industry. These also consider the lifestyle, culture, and values of society and individuals.

TECHNOLOGICAL

The innovation revolution today means an ever-changing technological landscape. Consequently, this can affect Research & Development, resource utilization, and costs. It is important to study the way technology changes industries. Also, to understand the way consumers interact with a brand. As a result, it can exponentially help growth.

ENVIRONMENTAL

Besides general sustainability practices, there are government policies and initiatives. They all hold everyone responsible for their own environmental impact. These factors include climate change and best practices. But there is also alignment with regional and international norms. Finally, corporate social responsibility (CSR) initiatives are a part of these as well.

Despite commonalities between legal and political factors, it is necessary to look at these separately. Since there are international and local government laws that could affect you and your brand. The legal factors may include patents and intellectual property. Or occupational health & safety protocols too. But it’s important to also consider employment and consumer protection laws among others.

There are great examples of how to conduct a PESTEL/PESTEL analysis on pestleanalysis.com . Check these out to gain a better understanding of the model. And surely implement its application!

Micro-Environment – Marketing Environmental Analysis

Unlike macro-environmental external factors, these forces have a direct impact on your organization or brand. There are several classifications for these. But the simplest is Competitors, Partners , and Customers . A thorough analysis of micro-environmental factors is necessary. Since the application of strategy and the success of its execution is connected to these forces. Let’s take a closer look at elements of each category now:

Competitors

In 1980, Harvard Business School’s Michael E. Porter outlined his 5 forces theory. He highlights major forces that shape marketing and organizational strategy. Undoubtedly, he did it in a competitive environment. This we can see in all industries now. These 5 forces can be further explored by looking for answers to the questions under each force below:

COMPETITIVE RIVALRY

Who are your competitors? And, how many of them are there? How do their products compare to yours? Besides, what advantages or disadvantages do you have on them? Lastly, how does your pricing, strategy, marketing, and market share match up to these competitors?

SUPPLIER POWER

How many suppliers do you deal with? Furthermore, what are the benefits and risks of dealing with them? If not them, what are your alternatives? And, how much do they charge you? Finally, how much control do you have in the relationship? 

BUYER POWER

How many buyers do you have? Also, what is the nature of your relationship with them? Are they distributors or direct customers? Moreover, what is the size and frequency of their orders? Because that shows who dictates the terms of the relationship. Consequently affecting… Will they go to a competitor’s offering? And the all-important, what will make them stay?

THREAT OF SUBSTITUTION

Is there another way… to do what you do? Are there alternatives? Or new options coming to the market? Besides, can what you do be outsourced for cheaper? Lastly of course, is there an easier solution to the problem you aim to solve?

THREAT OF NEW ENTRANTS

How easy is it for new brands to enter your domain? Is there a way to protect your market share? How are your brand and its identity positioned in your industry? Are you prepared for new entrants?

Without a doubt, analyzing your prospective and current customers is an essential undertaking. It has the biggest impact on your success. Performing consumer research will help you understand how the “public” feels about your brand. This research can be done with surveys. But also through feedback and analytics. It will aid decision-making for you or your business, as a result.

Successful analysis of your customers will help you:

• Connect with your customers to create meaningful relationships.
• Target high-value segments
• Meet service expectations
• Improve your offering
• Shape your brand image.

Once you have completed an analysis of your customers, you have to channel this into successfully creating Customer Personas. You can use these to serve segments better. And, you can check out how to create Customer Personas in this blog post here. Furthermore, Alexa’s blog has 10 great examples of personas that you can use to understand the inputs you may need to take in. Obviously, by adding value to your customers, you will position your brand as an effective solution to their needs!

Your partners could include a host of affiliates or agencies. Even service providers or consultants. The actual number depends on the nature of your business. It’s vital for these partners to be aligned with your goals. If so, you can be assured of their commitment to mutual success. For example, you could have agencies for your branding needs that uphold your brand image. They do this with quality signage. Additionally, you could be using third-party delivery partners for your e-commerce products. They need to ensure the delivery process is as seamless as an online purchase.

You have to take a deep look at every partnership that can benefit you. Then plan the terms within which you will operate. You have to maintain control processes to uphold your values and standards. Forming the right partnerships propels growth. It can add value for your customers. Further, it can revolutionize the way you and your industry do business. So a periodic examination of your partners will benefit you, your brand, your customers, and all marketing efforts.

Managing Partnerships

According to a 2015 McKinsey survey on managing strategic partnerships , the top 3 essential elements for shared success with partners are:

• Alignment on objectives
• Effective communication and trust
• Constructive leadership and processes

While looking at causes of failure in the same survey above, the factor that replaces leadership and processes is restructuring and evolution. How does this affect a constantly changing business landscape? It is always necessary to be prepared for the future! And ensuring your partners are positioned to join you. As you inevitably grow together. Despite this, do not forget to be agile enough. You have to be able to adapt too. There will be changes that your partners may be experiencing. Obviously, all relationships benefit from mutual understanding. And the way through is to have empathy!

Internal Environment – Marketing Environmental Analysis

Lastly, you have to take a closer look at all internal forces affecting how you operate. Your core mission and vision will address why you are in business, Consequently, it clarifies what you want to achieve. The McKinsey 7S framework is one of the most popularly used methods to analyze the internal environment. Being used since the late 1970s, it helps in assessing the functioning of organizations. It contains tangible elements such as Staff, Systems, Skills, and Structure. It also includes others like Shared Values, Strategy, and Style. Let’s take a look at these now:

Your goal helps you plan how you establish and grow. You do this to remain competitive within your industry. Your strategy has to be readily adaptable to changes in the environment. That’s how you meet your objectives.

Before, hierarchy defined the structure. Things are a little complex now with fluid work teams. But the shape and composition can evolve. The difference is made by communication and the ability to work together. This leads to an ideal situation where you work towards goals together.

Visibly, processes are in place everywhere. It includes all functions such as HR, Finance, IT, Sales, and Marketing. Other procedures also constitute systems like SOPs and guides. This undeniably contributes to how everyone in the organization plans to achieve set goals. Proper allocation of resources is important. But, constant tracking is vital.

The core competencies and capabilities of the entire team equal its skills. It is important to ensure new skills are taught. As well as the development of current skills. This will increase output. Thus making it easier to reach targets.

You have to take a look at each of your employees. Assess their behavior and motivations. Track their progression. Provide training. And engage them to earn their commitment. You have to constantly gauge them to have the best possible group of people. They will help you achieve your goals.

How the heads and managers chose to lead is crucial. It becomes a part of its style. Patterns of behavior will help in the formation of a culture. This culture brings employees together. They are in sync. In turn, this creates alignment with broader goals.

Shared Values

Culture is an accumulation of beliefs and values. Also, includes standards and behaviors. They shape how everyone conducts themselves. This applies to teams and organizations as well. It determines how staff treat each other. The shared values boost work ethic. Corporate culture leads to a direct effect on employee output and agility.

Critically, the framework relies on the integration of the 7Ss. You have to set the right goals. You can follow the SMARTER goals framework to do this. Check out this blog post that sheds light on it. Align your goals with your vision and mission. Your values and culture affect how your team performs. This changes the way your organization works and how others perceive your brand.

It’s directly connected to success for a brand. Assessment of your capabilities will help you play to your strengths. Additionally, the systems and processes you have in place optimize efficiency. This directly affects your bottom line. Your resource management and investment into R&D help you chart a way forward. Lastly, your employees, their capabilities, and continued growth are vital to achieving your goals, so keep that in mind always! This is much like running a content audit for your content strategy ! It is immensely useful and effective.

Above all, understanding how external factors affect your internal environment is crucial. It determines where you stand. You can’t expect to plan for the future without fully grasping your current position. Listing all the forces, directly and indirectly, is essential. It affects you and your business. But it is only part of the process. And connecting the dots to form patterns and trends in the next step. It will show you a way forward. Using the insights gained from the marketing environmental analysis makes the difference. You have to then turn it into an actionable plan in the next step.

A SWOT analysis is the most common, tried-and-tested method to utilize the information from marketing environmental analysis. You can see more about SWOT analysis, which is discussed here, in another blog post.

Clearly, there are several other frameworks, models, and applied theories in marketing. These are often interconnected. You can connect findings from the marketing environmental analysis to: – Choosing your Marketing mix – Selecting a broader marketing strategy such as the Ansoff matrix – Setting and deriving SMARTER goals or establishing OKRs – Understanding internal factors affecting change like the 7S McKinsey framework

Though, all can help you achieve similar results. The takeaway should be that your marketing environmental analysis is essential. How you do it, is up to you. It would be based on your resources and capabilities. Just remember that this isn’t a one-off exercise. You have to repeat it periodically. This is how you prepare for continued growth and success.

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Marketing Environment

Essay by Marry   •  February 8, 2012  •  Essay  •  3,185 Words (13 Pages)  •  7,251 Views

Essay Preview: Marketing Environment

1. marketing environment

For a market of your choice, outline the important macro- and micro-environmental factors that would need to be considered by marketers in trying to satisfy the needs and wants of consumers in that market, and explain why a clear understanding of the environment within which it operates is important for an organisation.

The marketing environmental analysis means using a set of academic models and knowledge's to evaluate the components might be affecting the organization. It is very important for the success of a company. The marketing environment change is important for marketers to decide their marketing strategy. Market-oriented companies may through examining marketing environment to provide products and services to customers and operate effectively.

Marketing Environment is the external element which affects the marketing strategy of organisation. as chart 2 shows, marketing environment would have influence on strategic decision.

Chart 2 Strategic marketing fit

The marketing environment can be classified into two levels micro-environment and macro-environment.

The macro-environment consists of a number of broader forces that affect not only the company, but also the other actors on the micro-environment. Macro-environment can be analysed by STEP model, which consists of social, technological, economic and political/legal.

The micro-environment consists of the actors in the firm's immediate environment or business system that affects its capabilities to operate effectively in its chosen market. The key actors are suppliers, distributors, customers and competitors, which related with Porter's 5 forces.

The automobile market will be the sample selected to evaluate the micro-environment factors using Porter's 5 forces framework and micro-environment by using STEP model.

According to Porter, there are five forces influencing the market in micro-environment: the threat of new entrants, the threat of substitute, the bargaining power of suppliers, the bargaining power of buyers and the rivalry among existing competitors.

New entrants to an industry bring new capacity and they push prices downward. However, the threat of new entrants in automobile market is relatively low because the existing players have already achieved significant economies of scale. It results in the difficulty for potential new entrants to be competitive. In addition, another reason for difficult to entry this market is the capital requirement. It needs huge amount capital to support the operation (financing R&D, advertising, inventories.)

A second force influencing the marketing microenvironment is the threat of substitute products. The availability of substitute products places limits on the prices market leaders can charge in an industry; higher prices may induce buyers to switch to the substitute. Currently, there are not significant substitute can instead an automobile as a common transport tool. LOW.

If suppliers have enough leverage over industry firms, they can raise prices high enough to significantly influence the profitability of the industry. The bargaining power of suppliers in automobile industry in not very high, even though the carmakers need a lot of parts such as tires, components etc., but there are a lot of suppliers in the industry, and most of the suppliers are rely on one carmaker to survival.

The buyers in the automotive market have the considerable bargaining power due to there are a lot of alternatives when they purchase a car. However, it depend the geographic factors. Different country may have the different policy to influence the buyer's power.

Rivalry among firms refers to all the actions taken by firms in the industry to improve their position and gain advantage over each other. In the automobile industry, there are a lot of carmakers such as GM, TOYOTA, and HONDA. Consequently, the competition is very high.

STEP is often used to describe the macro-environmental, which includes social, technological, economic and political forces.

Social: Environment, car culture, fashion and taste, redundancies (too many).

Technological: E-commerce, safety, plant efficiency, gizmo.

Economic: Excess capacity, Economies of scale, Diversification, Mergers and strategic alliance.

Political: Legislation: environment, company cars, competition. Taxes and Duty. Subsidies. (Unleaded petrol price)

Conclusion: the importance of environmental analysis when considering the more overtly strategic role of marketing (especially the role of marketing as philosophy of business, as embodied in a marketing orientation)

Both these micro- and micro-environmental forces are able to affect significantly the marketing decisions.

2. Branding

Branding has often been described as the process by which an organisation's product offer is differentiated from those of its competitors. Using appropriate examples, explain how might such differentiation be created and outline the advantages of so doing.

Students could begin by defining a brand, emphasising, in line with the question, that branding is the process by which companies distinguish their product offerings from the competition.

The importance of differentiation could then be discussed in terms of giving consumers some point of difference in relation to the evaluative criteria used by consumers in choosing between one brand and another. Different types of differentiation could then be outlined, using appropriate illustrative examples. These different avenues for differentiation could include: product aspects (e.g. specific features, performance, style & design etc.); service aspects (speed, installation etc.); personnel, image etc.

Students could then move on to discuss the importance and ubiquity of branding in today's marketing landscape - emphasising that if an individual organisation does not implement effective branding strategies, then it will be at a competitive disadvantage in relation to those competitors that do.

Students could conclude with some discussion the advantages of branding, such as: enhancement of company value through brand assets; positive effects on consumer preference/loyalty;

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Global Marketing Environment

Introduction

All businesses work in the same environment, which is connected by numerous global forces. Some of them have a direct impact on an organization’s activities, others are passively affected, but all of them have to be considered for marketing to be successful. The aspects of business-customer relations are diverse both in quantity and quality. Understanding which layers the global marketing environment incorporates is essential in ascertaining the importance of their consideration for global marketers.

Definition of Global Marketing Environment

The global marketing environment is the multitude of factors and forces which affect customer relationships. The goal of any business is interaction with clients who require the goods or services produced by an organization. For customer relations to be successful, several factors have to be favorable. The forces that influence business decisions are multivariate and depend on the size of an organization, as well as the target audience.

The larger the scope of a business is the more external factors influence it. If a company does not extend its operations beyond a certain area, then all focus is placed on the local environment. Similarly, a multinational corporation has to consider global issues because they have an immediate effect on the organization. In both cases, the forces, which compel companies to pursue a particular course of action with customers, constitute the marketing environment.

Internal Layer

The first layer of marketing environment factors is the internal one. It comprises aspects that are directly controlled by the organization. Management can change, alter, or eliminate them if they deem it necessary. The main characteristic of these aspects is that they are not shaped by outside forces or influences. All decisions are made from within the business; thus, the layer is named internal.

The variables of the internal layer include strategy, structure, processes, and resources. The strategy is the overall plan of how a business approaches its customers. The chosen direction determines the structure that is necessary for promoting products. The processes incorporate the actual steps taken to reach customers. Finally, any initiative relies on resources at the organization’s disposal. All these variables are controlled by management without any influence from outside forces.

External Layer

The external layer is the most multifaceted because it incorporates a broad range of outside forces impacting the business’ marketing activities. The layer is divided into two sublayers – macro and micro. The microenvironment represents variables that can be influenced by an organization that does not control them. For instance, suppliers, distributors, customers, competitors, and other stakeholders are all relevant in marketing decision-making. Business managers can affect them, but they exist regardless of the organization’s input.

The opposite is true in regards to the macro environment, which is entirely independent of the organization’s actions[UU1]. Nevertheless, all these factors should be considered by marketers because they determine the context within which the business functions. For example, the existing political system may prohibit some actions and allow others, thus forcing the company to adjust its marketing accordingly. In the same manner, both domestic and international laws determine the legal restrictions concerning marketing endeavors.

Among other macro-environmental variables are the economic aspects surrounding the region in which a company operates. They include the degree of planning in the economy, specifics of trade rules, and relations between the business’ country and those that host the organization’s affiliates. One more important variable is socio-cultural differences as some marketing practices may be seen as inappropriate and prohibited in other nations. Technological advancement should also be considered since business activities involving customers can be hinged by the lack of sufficient equipment in a hosting country. Overall, all macro and micro-environmental factors constitute the external layer, which is largely uncontrolled by the management of the organization.

Global Social Issues

The final layer consists of factors that influence the world at large. It is a natural continuation of the external layer in terms of the organization’s input. The difference is that micro and macro variables are specific to a region within which the business operates. Global issues are relevant irrespective of the geographical location of the organization. Their impact may be passive, but it is felt throughout society.

Global variables include climate change, ethics, migration, and other forces which extend beyond a single region or a group of people. For instance, global warming forces governments to adopt environmentally friendly policies. In their turn, such regulations oblige companies to follow specific standards, which are subsequently relayed through corporate marketing. Similarly, migration causes ethnic diversity to rise. Companies have to correct their promotional materials to cater to minorities and foreigners in the targeted area.

The aforementioned issues are widely known because of extensive media coverage. It also means that marketing heavily relies on global problems to promote products, raise the corporate image, and attract customer interest. The more globalized a company is, the more directly worldwide issues impact such business. As enterprises become more powerful, the expectation of their global awareness also rises. Firms are supposed to function concerning their corporate social responsibility and take steps to resolve worldwide problems.

Importance of Marketing Variables

All layers of the global marketing environment are involved in the competition between businesses. Organizations have to understand that all variables give marketing advantages and disadvantages. Some factors may increase the risk of failure, whereas others can set the groundwork for success. Marketing is built on small details, which vary from region to region and from customer to customer. The ability to recognize the environment and decide what the correct course of action will be is the distinguishing trait of an efficient marketer.

In practice, by evaluating the variables, enterprisers can assess the risk of working with customers. Based on the analysis, management devises a business strategy, which may be flawed if variables are interpreted incorrectly. At the same time, a sensible assessment of variables will help the organization save time and resources, which would be lost without the analysis of the marketing environment. Therefore, evaluation of variables is essential in conducting business and should be approached with respective attention and thoroughness.

Altogether, it should be evident that the complexity of the global marketing environment is justified by the abundance of variables that influence marketing decisions. Each layer has factors that should be considered by marketers. The more global the scope of the variables is, the less control over them management has. The internal layer consists of factors, which are managed from within the organization, the external layer has more independent regional forces, and global issues influence the entire society. All variables are crucial because they reduce the business’ risk of marketing failure.

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Essay on Marketing: Top 9 Essays on Marketing

Essay on‘Marketing’. Find paragraphs, long and short term papers on ‘Marketing’ especially written for school and college students.

Essay on Marketing

Term Paper Contents:

• Essay on the Challenges and Opportunities of Marketing

Essay # 1. Introduction to Marketing:

ADVERTISEMENTS:

Marketing is everywhere. Everything from presenting yourself for a job interview to selling your products includes marketing. Main objective of any company is to gain profits which can be achieved only through marketing of the products. Marketing enables the companies to create demand and earn profits. If these two aspects are not taken care of, then the company will not survive in the market.

“Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers, and for managing customer relationships in ways that benefit the organization and its stakeholders.” – (American Marketing Association)

“Marketing is a social process by which individuals and groups obtain what they need and want through creating, communicating, and delivering value to customers and for managing customer relationships in ways that benefit the organization and its stakeholders.” – (Philip Kotler)

Thus it can be safely said that a company reaches its customer through marketing and communicates to them about the products and services offered by the company.

ADVERTISEMENTS: (adsbygoogle = window.adsbygoogle || []).push({}); Essay # 2. Evolution of Marketing :

In earlier days, an organization was mainly concerned with production of goods. It used to believe on mass production and paid less or negligible attention on quality of the product and the customer’s demand.

After some time, the focus of organization shifted from production of the product to the sale of the product. The concept of marketing emerged gradually in 1970’s after the production and sales era. It took many years for organizations to realize that a customer is the key for making profits in the long run. The marketing concept is evolved through various stages.

These stages are explained below:

1. Production Era :

The production era began with the Industrial Revolution in the 17th century and continued till 1920s. Say’s law – Supply creates its own demand – was applicable in this era. The demand for products was more than the supply in the market; thus, it was a seller’s market. In the production era, the main aim of an organization was to manufacture products faster and at low prices. In this era, customers were concerned only about the availability of products and no importance was given to features and quality of products.

2. Sales Era :

The sales era came into existence in 1920s and continued till the mid of 1950s. This era was marked by the great depression of 1923. The depression proved that manufacturing products was not everything because the sale of the products was also important for organizations to earn profit.

Thus, the need for developing promotion and distribution strategies emerged to sell products. The organizations started advertising their products to increase their sales. Many organizations created specialized market research departments to collect and analyze the prevailing market data.

3. Marketing Era :

The sales era merely focused on selling the goods and ignored the consumers’ needs and demands. The year 1970 marked the advent of marketing era. In the marketing era, organizations realized the importance of customers and started designing the products as per customers’ needs.

Therefore, the marketing era led to the development of customer-centered activities over the production and selling activities. Organizations came up with different techniques, such as customer survey, to collect and analyze data for understanding the customer’s expectations, needs, and wants.

ADVERTISEMENTS: (adsbygoogle = window.adsbygoogle || []).push({}); Essay # 3. Approaches to the Study of Marketing:

The meaning of marketing is different to different people. In common parlance, marketing is the process of selling something at a market place. To a salesman it means selling whereas to an advertising manager it means advertising. To some it means the study of individual commodities and their movement in the market place, to some others marketing means the study of institutions and persons who move their products or study of the economic contributions.

Thus, there are different approaches to the study of marketing:

1. Commodity Approach:

The commodity approach focuses a specific commodity and includes the sources and conditions of supply, nature and extent of demand, the distribution channels used and the functions, such as buying, selling, financing, advertising storage etc. various agencies perform. Prof. Paul Mazur defined as “the delivery of a standard of living to society. Prof. Malcolm McNair expanded the definition to “the creation and delivery of a standard of living”.

2. Institutional Approach:

The institutional approach focuses on the study of various middlemen and facilitating agencies.

3. Functional Approach:

The functional approach considers different kinds of functions recognized for their repetitive occurrences and necessarily performed to consummate market transactions. Converse, Huegy and Mitchell define marketing as the “business of buying and selling and as including those business activities involved in the flow of goods and services between producers and consumers.” American Marketing Association, perhaps, gives more factual or descriptive definition. It defined marketing as the performance of business activities that direct the flow of goods and services from producer to consumer or user.

4. Managerial Approach:

The managerial approach concentrates on the decision making process involved in the performance of marketing functions at the level of a firm. Howard, Phelps and Westing and Lazo and Corbin are the pioneers of the managerial approach.

5. Societal Approach:

The societal approach consider the interactions between the various environmental factors (socio-logical, cultural, political, legal) and marketing decisions and their impact on the well- being of society. Kotler, Feldman and Gist, were the main proponents of the societal approach.

6. Systems Approach:

The systems’ approach is based on Von Bartalanffy’s general systems theory. He defined system as a “set of objects together with the relationships among them and their attributes”. This approach recognizes the inter-relations and inter-connections among the components of a marketing system in which products, services, money, and equipment and information flow from marketers to consumers that largely determine the survival and growth capacities of a firm.

7. Modern Concept:

The new managerial awareness and desire reflected in the consumer orientation for all all-out commitment to the market consideration and to connect all marketing operations to the consumer needs has given birth to a new operational concept. Felton views the marketing concept as “a corporate state of mind that insists on the integration and coordination of all marketing functions that, in turn, are welded with all other corporate functions, for the basic objective of producing maximum long-range corporate profits.

According to Kotler, the marketing concept is a customer orientation backed by integrated marketing aimed at generating customer satisfaction as the key to satisfying organizational goals. According to McNamara,” marketing concept is … a philosophy of business management, based upon a company- wide acceptance of the need for customer orientation, profit orientation, and recognition of the important role of marketing in communicating the needs of the market to all major corporate departments”.

Lazo and Cobin describe marketing concept as ” the recognition on the part of management that all business decisions of a firm must be made in the light of customer needs and wants; hence, that all marketing activities must be under one supervision and that all activities of a firm must be coordinated at the top, in the light of market requirements”. King has given one of the most comprehensive descriptions of the marketing concept. He defined it as, “a managerial philosophy concerned with the mobilization, utilization and control of total corporate effort for the purpose of helping consumers solve selected problems in ways compatible with planned enhancement of the profit position of the firm”.

These definitions suggest that marketing is only concerned with the movement of goods and services from the plant to the consumer. This is thus a production-oriented definition more appropriate for a sellers’ market and dangers in case of buyers’ market. In fact, marketing is related with the sophisticated strategy of attempting to offer what the consumer may want and at a profit.

ADVERTISEMENTS: (adsbygoogle = window.adsbygoogle || []).push({}); Essay  # 4. Objectives of Marketing:

According to Peter F. Drucker, “Marketing means such a perfect understanding of the customer that the product fits him totally and sells itself. Marketing would result in a customer who is ready to buy all that, what should be needed then is to make the product available.”

Organization’s marketing strategies are designed in tune with various marketing objectives.

The objectives of marketing aim at:

1. Creating demand for the products by identifying the needs and wants of customers. The consumers get familiar with the usage of products through different promotional programs, such as advertising and personal selling. This helps in creating demand for the products by the customers.

2. Increasing the market share of the organization. The marketing efforts, such as promotion, create the product awareness in the market. The product awareness helps in capturing the reasonable share in the market by organization.

3. Building the goodwill of the organization in the market. Every organization tries to earn reputation in the market by providing quality goods to the customers. It builds its goodwill by popularizing products supported by advertising, reasonable prices, and high quality.

4. Increasing profits and achieving long-term goals through customer satisfaction. All the marketing activities revolve around the customer. These activities fulfill the organization’s long-term goal of profitability, growth, and stability by satisfying the customer’s demands. All the departments, such as production, finance, human resource, and marketing, coordinate with each other to fulfill the customer’s expectations keeping the maximization of profit as the focus.

Essay # 5. Marketing Process:

Marketing Process —– The marketing process is one that invol­ves the following chain of business activities:

1. Identification and study of the desires, needs, and requirements of the^ consumers;

2. Testing the validity of the consumers’ reaction in respect of product features, price, distribution outlets, new product concepts, and new product introduction;

3. Matching the consumers’ needs with the firm’s offerings and capa­bilities;

4. Creating effective marketing communications and programmes with emphasis on lower price, mass distribution channels and mass advertising to reach numerous market segments so that the consumers know about the product’s availability; and

5. Establishment of resource allocation procedures among the various marketing components like sales promotion, advertisement, distribution, product design, etc. 

Outline of functions in the Marketing Process : In order to place the goods in the hands of the consumers, an integrated group of activities is involved in marketing. Marketing functions cover all those activi­ties which are required for the journey of goods from the producer to the consumer. Goods require some preparations, undergo many operations and pass several hands before they reach the final consumer.

In consideration of the above factors, Clark has divided the modem marketing process into three broad categories as under:

(i) Concentration

(ii) Dispersion

(iii) Equalisation.

These are explained below.

1. Concentration – In a marketing process, concentration is that business activity in which the goods flow from many manufacturers/producers toward a central point or market. If we think of international trade, we find that the customers of a particular corporation or firm world reputation are scattered in different countries and even located thousands of miles, away, and the products are transhipped to points accessible to than. Similar scene is found even in the case of national trade. With the development of trade and commerce, the efforts in the direction of concentration acti­vity have to place more stress on the functions like collection, storage, transportation and inventory of goods in the central markets, and processing of customer’s orders. In addition, the aspects of financing and risk-bearing are also to be taken into consideration.

In India, the concentration activity is undertaken by the Governments at the Central and State levels. Food example, The Food Corporation of India undertakes this activity in case of grains, rice, sugar, etc.

2. Dispersion – In a marketing process, dispersion is that busi­ness activity in which the goods flow from the central locations to the final consumers. The wholesalers and retailers play a great role in this activity. This activity involves many other supporting activities like classification, gradation, storage and transportation of goods. The func­tional aspects of finance and risk-bearing need important considerations.

In India, the agencies like The State Trading Corporation of India, The Minerals and Metals Trading Corporation of India, and The Food Corpora­tion of India undertake this dispersion or distribution activity in respect of certain specified goods. Sane large scale manufacturing companies have, of late, undertaken this activity as a part of their marketing activities.

3. Equalisation – In a marketing process, equalisation refers to the adjustment of supply to demand on the basis of tint, quality, and quantity. This process helps to maintain the state of equilibrium between the forces of demand and supply. The primary responsibility of a business unit towards the consumers and customers is to make available the right products of right qualities at the right tine, in right quantity, at the right place and at the right price. The equalisation activity can serve these objectives.

Essay # 6. Integrated Marketing Communication Process:

Marketers operate is a very dynamic environment characterised by changing customer needs and wants, severe competition, changing process technology, advancements in information technology, government regulations, etc. That is why, they are adopting Integrated Marketing Communication (IMC).

Integrated Marketing Communication (IMC) involves integration of company’s various communication channels to deliver a clear, consistent and compelling message about the company and its products and brands. Most of the companies communicate with target customers by using promotion tools like advertising, personal selling, sales promotion, public relations and direct marketing. Through each of these tools, some message is transmitted to the target customers. IMC calls for careful blending of these promotional tools to ensure effective communication.

Integrated Marketing Communication (IMC) requires developing a total marketing communication strategy that recognises that all of a firm’s marketing activities (not just promotion) communicate with its customers. Everything a marketer does sends a message to the target market.

The EMC approach is an improvement over the traditional approach of treating various promotional activities as totally separate. It helps to develop the most suitable and effective method to contact customers and other stakeholders.

Often different tools play different roles in attracting, informing and persuading target customers. These tools are carefully coordinated under IMC so that they provide the same clear and consistent information about the company and its products/brands.

IMC leads to a total marketing communication strategy aimed at building strong customer relationships by showing how the company and its products can help customers solve their problems. It ties together all of the company’s messages and images.

The company’s television and print advertisements have the same message, look, and feel as its e-mail and personal selling communications. And its public relations materials project the same image as its Website or social network presence.

Communication Process:

Definition of Communication:

The term ‘communication’ is derived from the Latin word ‘communis’ which means common. That means if a person communicates with another, he establishes a common group of understanding. According to Newman, Summer and Warren, “Communication is an exchange of facts, ideas, opinions or emotions by two or more persons”.

Communication does not mean merely sending or receiving message. It involves understanding also. It is, in fact, a bridge of meaning and understanding between two or more people. Thus, communication is a two- way process.

The salient features of communication are as follows:

(i) Communication involves at least two persons—one who sends the message and the second who receives the message.

(ii) Communication is a two-way traffic. The process of communication is not completed until the message has been understood by the receiver. Understanding is an essential part of communication, but it does not imply agreement.

(iii) The basic purpose of communication is to create an understanding in the mind of the receiver of information.

(iv) Communication may take several forms, e.g., order, instruction, report, suggestion grievance, observation, etc. The message may be conveyed through words spoken or written, or gestures.

Elements of Communication:

Communication is a process involving exchange of facts, viewpoints and ideas between persons placed in different positions in the organisation to achieve mutual understanding as shown in Fig. 11.5. The communication process starts when the sender or communicator has a message communicate to some other person known as receiver. It will be completed when the receiver gets the information and sends feedback to the communicator.  

The essential elements of communication are described below:

(i) Sender or Communicator:

The person who conveys the message is known as communicator or sender. By initiating the message, the communicator attempts to achieve understanding and change in the behaviour of the receiver. In case of marketing it is the marketer (sender) who starts the communication process.

(ii) Message:

It is the subject-matter of any communication. It may involve any fact, opinion or information. It must exist in the mind of the communicator if communication process is to be initiated. In marketing, the marketer’s message relates to product, price and place.

(iii) Encoding:

The sender of information organises his idea into a series of symbols (words, signs, etc.) which, he feels, will communicate to the intended receiver or receivers. This is called encoding of message. Communication may take place through physical gestures also.

(iv) Media or Communication Channel:

The communicator has to choose the channel for sending the information. Communication channels are the media through which the message passes. It may be either formal or informal. In marketing, media may be salespersons, advertisement and publicity.

(v) Receiver:

The person who receives the message is called receiver. The communication process is incomplete without the existence of receiver of the message. It is the receiver who receives and tries to understand the message. The receiver in case of marketing is the prospective or present customer.

(vi) Decoding:

After the appropriate channel or channels are selected, the message enters the decoding stage of the communication process. Decoding is done by the receiver. Once the message is received and examined, the stimulus is sent to the brain for interpreting, in order to assign some type of meaning to it. It is this processing stage that constitutes decoding. The receiver begins to interpret the symbols sent by the sender, translating the message to his own set of experiences in order to make the symbols meaningful.

(vii) Response:

Response refers to the set of reactions that the receiver has after being exposed to the message. In case of advertising, a response may mean developing a favourable attitude towards the product as a result of an advertising campaign. However, in many cases, measuring such responses is not easy.

(viii) Feedback:

Communication is completed when the communicator receives feedback information from the receiver. The feedback may reveal that the receiver has understood the message. It may also contain information about the action taken by the receiver on the basis of message sent by the communicator. Thus, feedback is the backbone of effective communication.

(ix) Noise:

Noise is a very common thing we observe in our day-to-day interaction with others. At times it affects adversely the effectiveness of communication. For example, if a person is talking over the phone to another and there is a noise around him, he will feel great difficulty in listening to the person at the other end of the phone. Even the noise can affect the voice of the sender of the message.

Hurdles or Difficulties in Marketing Communication:

There are four factors which might create hurdles or problems in communication between the marketer and the target customer.

These hurdles include noise, selective attention, selective distortion and selective retention as discussed below:

Noise is a sort of interfering sound in the communication process anywhere along the way from the sender to the receiver and vice versa. It can be sound of running bus, two persons talking close at hand or someone shouting around. Noise of any kind has the potential of creating disruption or barrier to effective communication. The sources of noise can be both internal and external. Noise within the office can be controlled, but it is very difficult to control the external noise.

Noise is one of the biggest obstacles in marketing communication. For example, a driver’s need to provide safety to the traffic sidetracks the role of billboards, banners, etc. during disturbed weather conditions —wind, dust storm, rain, etc. Similarly, too much advertisement exposure during the day of purchase of tyre for a car, would disturb the planned purchasing.

These constitute noise in the communication process. The level of noise may not allow a customer to receive the message as intended. The effectiveness of communication depends upon the level of congruity and compatibility between different elements of the communication.

(ii) Selective Attention:

A person may be exposed to hundreds or thousands of ads or brand communications in a day. Because a person cannot possibly attend to all of these, most stimuli will be screened out. This process is called selective attention. Because of this, the marketers have to work hard to attract consumer’s notice. Generally, people are more likely to notice stimuli that relate to a current need.

Thus, a person who is motivated to buy a car is most likely to notice car ads. The process of selective attention explains why advertisers make extra efforts to grab the audience’s attention through fear, music, or bold headlines.

(iii) Selective Distortion:

Selective distortion is the tendency to interpret information in a way that fit one’s perception. Consumers often distort information to be consistent with prior brand and product beliefs. Thus, the target audience will hear what fits into their belief systems.

As a result, receivers often add things to the message that are not there and do not notice other things that are there. The advertiser’s task is to strive for simplicity, clarity, interest and repetition to get the main points across.

(iv) Selective Retention:

People retain in their long-term memory only a small fraction of the messages that reach them. If the receiver’s initial attitude towards the brand is positive and he rehearses support arguments (that is, tells himself things such as the product is in fashion or that it is reasonably priced or that it delivers good value, etc.), the message is likely to be accepted and have high recall.

If the initial attitude towards the brand is negative and the person rehearses counter arguments (that is, tells himself that the product is highly overpriced or that the competing products offer more value to customers or that the brand is not doing well in the market, etc.) the message is likely to be rejected but to stay in long-term memory.

Thus, the advertiser’s task is two-fold here. He not only has to create an initial favourable attitude towards the brands but also through his ads communicate to the audience strong points about the brands so that the customers can rehearse the same and the brand is positively placed in the long-term memory of the customers.

Essay # 7. Role of Marketing in Economic Development :

In today’s era of globalization role of marketing is increasing to fulfill different needs and requirements of people. Due to increase in scale of production and expansions of markets, producers need support of marketing tools to distribute their goods and services to the real customer.

High competition in market and product diversification has increased the marketing activities like advertising, storage, sales promotion, salesmanship etc. Now high profits can be attained by high sales volume and good quality of products and services. Marketing has acquired an important place for the economic development of the whole country. It has also become a necessity for attaining the objective of social welfare and high quality of life.

The importance of marketing can be explained as under:

(a) Importance of Marketing to a Firm:

Marketing is considered to be the prime activity among all the business activities. Success of any business depends on success of marketing. Peter F. Drucker has rightly said that, “Marketing is the business.” Objective and goals of any organization can be achieved through efficient and effective marketing polices. The success of an enterprise depends to a large extent upon the success of its marketing activities.

The importance of marketing to the firm can be explained as under:

1. Marketing in Business Planning and Decision Making:

Marketing research is helpful in searching opportunities and potential in market. It is necessary for an organization to decide what can be sold before deciding that what can be produced. Unless and until these key decisions are taken, it is not practical to take the decisions regarding production, quality of product, type of product and quantity of production etc.

Marketing is very helpful in taking all such decisions therefore its plays an important role in business planning. Marketing provides valuable information regarding production policies, pricing policies, advertisement and sales promotion policies of competitors, so that a suitable policy may be formulated by the top management.

2. Increase in the Profits:

The main objective of every firm is to increase the profitability by successful operations of its activities. Maximization of profits can be possible only through the successful operations of its activities. Marketing department need the help of other departments as well for discharging its duties successfully, marketing department coordinate with other departments like finance, production, to fulfill the needs of customers and regular supply according to market demand.

3. Flow of Marketing Communication:

Integrated marketing communication makes it possible to flow marketing information to intermediaries, publics and customers. Marketing acts as a medium of communication between the society and the firm. Various information regarding trends, needs, attitudes, fashions, taste preferences etc., are collected by marketing department.

(b) Importance of Marketing to the Society:

1. To Uplift Standard of Living:

Ultimate objective of marketing is to produce goods and services for the society according to their needs and tastes at reasonable prices. Marketing discovers the needs and wants of the society, produces the goods and services according to their needs, creates demand for these goods and services encourages consumers to consume them and thus improves the standard of living of the society. By advertising utility and importance of products and services are communicated to the people.

2. To Decreases the Total Marketing Cost:

Next important responsibility of marketing is to control the cost of marketing. Distribution cost and production cost can be decreased by creation of high demand in market. Decrease in cost of production will have two impacts, firstly the high profitability of organization and secondly to increase in the market share of the firm.

3. Increase in the Employment Opportunities:

Marketing provides direct and indirect employment in society. Employment opportunities are directly related with the development of marketing. Successful operation of marketing activities requires the services of different enterprises and organizations such logistics, warehousing, transportation, retailing finance, etc.

4. In controlling Business Fluctuations:

Business fluctuations like recession and depression causes unemployment, and deflation. Marketing helps in protecting society against all these problems. Marketing helps in innovation and discovery of new markets for the goods, modifications and alterations in the quality of the product and development of alternative uses of the product. It reduces the cost of production and protects the business enterprise against the problem of recession.

5. Increase Per Capita Income:

Marketing operations create, maintain and increase the demand for goods and service. Marketing activities flow money from one part of economic system to other. By generation of new employment opportunities it helps to increases income of people.

(c) Importance of Marketing in Economic Development:

Marketing plays an important role in the development of a country. Most of developed countries like USA, Japan, and Germany are having strong marketing system, they are moving towards global marketing. Industrial growth and development need support of marketing, large scale of production requires new markets. In these countries, the production exceeds the demand it need marketing system to be much more effective so that the produced goods and services can be sold.

Marketing has a vital role to play in the development of an underdeveloped and developing economy. In developing economies the industrialization and urbanization is increasing at a faster rate and so the importance of marketing is also increasing as it is required for selling the produced goods and services. A rapid development of underdeveloped economy is possible only if the modern techniques of marketing are used in these countries marketing activities are increasing at a fast rate in developing countries.

Essay # 8. Importance of Marketing :

Role of Marketing in a Firm :

Efficient marketing management is a pre-requisite for the successful operation of any business enterprise. A business organisation is differentiated from other organisations by the fact that it produces and sells products.

The importance of marketing in modern business is discussed below:

Marketing is the beating heart of the business organisation. The chief executive of a business cannot plan, the production manager cannot produce, the purchase manager cannot purchase, and the financial controller cannot budget until the basic marketing decisions have been taken. Many departments in a business enterprise are essential for its growth, but marketing is still the sole revenue producing activity. Marketing function is rightly considered the most important function of management.

Marketing gives top priority to the needs of customers. Quality of goods, storage, display, advertisement, packaging, etc. are all directed towards the satisfaction of customer.

Marketing helps in the creation of place, time and possession utilities. Place utility is created by transporting the goods from the place of production to consumption centres. Time utility is created by storing the goods in warehouses until they are demanded by customers. Possession or ownership utility is created through sale of goods. The significance of marketing lies in the creation of these utilities to satisfy the needs of the customers and thereby earn profit. It a firm is able to satisfy its customers, it will have better chances of survival and growth even in the fast changing environment.

Marketing generates revenue for the business firm. Marketing is an important activity these days, particularly in the competitive economies. Marketing generates revenue for the business enterprises. No firm can survive in the long-run unless it is able to market its products. In fact, marketing has become the nerve-centre of all human activities.

Role of Marketing in the Economy :

Marketing plays a significant role in the growth and development of an economy. It acts as a catalyst in the economic development of a country by ensuring better utilisation of the scarce resources of the nation. Since a business firm generates revenues and earns profits by its marketing efforts, it will engage in better utilisation of resources of the nation to earn higher profits.

Marketing determines the needs of the customers and sets out the pattern of production of goods and services necessary to satisfy their needs. Marketing also helps to explore the export markets.

Marketing helps in improving the standards of living of people. It does so by offering a wide variety of goods and services with freedom of choice. Marketing treats the customer as the king around whom all business activities revolve. Besides product development, pricing, promotion, and physical distribution of products are carried out to satisfy the customer.

Marketing generates employment for people. A large number of people are employed by modern business houses to carry out the functions of marketing. Marketing also gives an impetus to further employment facilities. In order to ensure that the finished product reaches the customer, it passes through wholesalers and retailers and in order to perform numerous jobs, many people are employed.

On the whole, marketing leads to economic development of a nation. It increases the national income by bringing about rise in consumption, production and investment. It mobilises unknown and untapped resources and also facilitates full utilisation of production capacity and other assets. It helps in the integration of industry, agriculture and other sectors of the economy. It also contributes to the development of entrepreneurial and managerial talent in the country.

Essay # 9. Challenges and Opportunities of Marketing:

A large number of changes have taken place in the recent years which have influenced the field of marketing as discussed below:

1. Globalisation :

The term ‘globalisation’ means the process of integration of the world economy into one huge market through the removal of all trade barriers or restrictions among countries. In India, restrictions on imports and exports and inflow and outflow of capital and technology have been lifted by the Central Government so that Indian business may become globally competitive.

The broad features of globalisation are as follows:

(i) Free flow of goods and services across national frontiers through removal or reduction of trade barriers.

(ii) Free flow of capital across nations.

(iii) Free flow of technology across nations.

(iv) Free movement of human resources across nations.

(v) Global mechanism for the settlement of economic disputes.

The aim of globalisation is to look upon the world as a ‘global village’ which would allow free flow of goods, capital, technology and labour between different countries. Because of globalisation, there has been a tremendous impact on marketing strategies of business firms, particularly engaged in international marketing. They have to design product, price, promotion, place or distribution strategies to meet the challenges of global marketing.

2. Information Technology (IT) :

Information technology has enabled real-time access and sharing of digital information through digital networks, information database, and computer graphics. It has brought about many changes in the business landscape.

Electronic technology has facilitated purchase and sale of goods and services electronically. E-Commerce can be used not only to market product, but also to build better customer relationships. Thus, marketers are facing new challenges as regards booking of e-orders, e-deliveries of intangible products, receiving e-payments and Customer Relation Management (CRM).

3. Increased Leisure Time :

As a result of shorter working week, vacations, and labour-saving devices available for domestic use, most wage-earners now enjoy more leisure time. So there has grown a market for articles used for recreational purposes to enjoy the leisure time. In the developing countries also, cinema shows, holiday trips, sports and games have come into importance.

4. Changing Role of Women :

Throughout the world more and more women are taking up jobs and have gained economic independence to a large extent. They accept even challenging jobs. They also exert greater influence on buying decisions of their families. It may happen that husband buys a commodity according to the decision of the wife. This has necessitated special study of the buying motives of the working women.

5. Demand for Services :

Over the years, consumers’ demand for services is on the rise as in case of tour and travel, educational, medical, repair and maintenance services, etc. Due to growing complexity, business firms also need expert services like accounting, taxation, advertising, customer care, etc.

6. Increased Competition :

Business has become more competitive these days and this has brought about many changes in the field of marketing, e.g., product differentiation, competitive pricing, competitive advertising, customer support services, etc.

7. Social Emphasis :

Marketing is now concerned with the long-term health and happiness of consumers and well-being of society. Marketers in are getting involved in improving the quality of life of consumers and preventing or minimising the evil effects of environmental pollution on the society by practising green marketing.

Emerging Concepts in Marketing :

1. Social Marketing:

It refers to the design, implementation, and control of programs seeking to increase the acceptability of a social idea, cause, or practice among a target group. For instance, a recent publicity campaign for prohibition of smoking in Delhi explained the place where one can and can’t smoke in Delhi.

2. Relationship Marketing:

It is the process of creating, maintaining, and enhancing strong value-laden relationships with customers and other stakeholders. For example, British Airways offers special lounges with showers at many airports for frequent flyers. Thus, providing special benefits to valuable the customers to strengthen bonds will go a long way in building relationships.

To achieve relationship marketing, a marketer has to keep in touch with the regular customers, identify most loyal customers to provide additional services to them, design special recognition and reward schemes, and use them for building long-term relationships.

3. Direct Marketing:

It means marketing through various advertising media that interact directly with consumers, generally calling for the consumer to make a direct response. Direct marketing includes Catalogue Selling, Mail Order, Tele computing, Electronic Marketing, Selling, and TV Shopping.

4. Service Marketing:

It is applying the concepts, tools, and techniques, of marketing to services. Service is any activity or benefit that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Services may be financial, insurance, transportation, banking, savings, retailing, educational or utilities.

5. Non-Business Marketing:

Marketing is applied not only to business firms but also to non-business organisations. Voluntary institutions are adopting principles and practices of marketing to promote their ideologies, schemes and programs among the target groups.

Related Articles:

• Essay on Marketing: Top 5 Essays | Marketing Management
• Essay on Sales Promotion: Top 4 Essays | Functions | Marketing Management
• Marketing Features: 4 Major Features of Marketing – Explained!
• Difference between Marketing and Selling

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25 Important Marketing Environment Questions and Answers [Notes with PDF]

The second chapter of our marketing learning course is “ Marketing Environment”. In this article, we’ll learn the 25 most important marketing environment questions and their answers.

You can read the first chapter of our free “ Marketing learning course ” here if you missed it.

Marketing Environment Questions and Answers:

The following are the 25 important marketing environment questions and answers:

On the one hand, there are natural elements such as topography, climate, rivers, hills, mountains, and forests, among others.

On the other hand, unnatural elements such as education-culture, science-technology, law, economy, religious beliefs, politics, and so on exist.

Answer: External and potential forces and entities that influence the marketing of products, services, or ideas are referred to as marketing environments.

The marketing environment includes factors such as buyers, sellers, suppliers, people, the country’s social, cultural, and political conditions, and so on that influence marketing activities.

Question 03: What is the relationship between the environment and the marketing environment?

In contrast, the marketing environment is regarded as a component of the overall environment.

An organization’s marketing environment consists of the elements that influence product marketing.

Question 04: Why is it important to study the marketing environment?

2. Macro Environment

Such aspects of the environment, energy, and surrounding elements directly influence marketing operations. In this case, the behavior of the smallest elements of the marketing environment and their functions are discussed separately.

Companies, suppliers, intermediaries, buyers, competitors, populations, and so on are all components of a micro-marketing environment.

These environmental elements are under the marketer’s direct or indirect control. For example, the company has direct control over all departments and surfaces.

Answer: All elements of the macro marketing environment are driven by external and uncontrollable forces. The overall environment can create both risks and opportunities for the company.

That is, the macro environment is made up of the forces that influence the micro-environment from the largest society, the population, economic, natural, technological, political, and cultural forces.

Question 11: Why are the elements of the macro environment uncontrollable?

The marketer cannot, under any circumstances, control the ingredients alone. Although some aspects of the macro environment may be affected collectively, it is not possible for the marketer to do so alone.

Question 12: How does the environment affect marketing?

The environment has a significant impact on each of these jobs.

That is to say, the environment has an impact on every marketing act.

Answer: Competitors are those who have an impact on an organization’s marketing activities by offering similar products or services.

Question 14: How does the company influence marketing?

Answer: A company is a legal entity made up of a few people. A company has various departments. Purchase departments, sales departments, manufacturing departments, finance departments, R&D departments, accounting departments, marketing departments, and so on.

According to the decision of the top management , the marketing department prepares the plan and arranges it for its implementation.

Marketing is one of the most important parts of the company. The functions of the marketing department are conducted with the help of other departments.

The job of the research and development department is to improve the quality of existing products and create new products.

The finance department arranges the necessary funds. The job of the accounting department is to calculate the cost and profit loss.

Answer: Various materials are required for the company’s smooth operation. Suppliers are individuals or organizations who provide all of the materials for the company.

Failure to deliver required materials on time disrupts operations and tarnishes the company’s reputation.

Marketers can exert control over the environment by working with a variety of suppliers.

For example, wholesalers, retailers, distributors, representatives, etc.

The company’s marketing skills depend on their cooperation. Therefore, in determining the middlemen, it is necessary to consider their efficiency, cost, quality of services provided, etc.

Answer: Competitors are business rivals who usually offer similar products or services.

That is to say, the marketing activities of an organization that are influenced by other similar products or service offers are called competitors.

To survive in the competition, the marketer must identify the competitors, understand their strategies, and tailor his own strategy accordingly.

Because the organization’s success is dependent on using a marketing strategy that is consistent with the competitors.

For example, the financial population, media population, government population, civic activities population, local population, general population, and internal population.

The company must establish and maintain positive relationships with these communities in order to create a favorable environment.

Question 19: How does the customer influence marketing?

As a result, the marketer has to adapt the marketing activities according to the characteristics of the buyer’s market.

Reseller market buyers purchase goods or services for profit through resale, government market buyers purchase goods or services for the purpose of maintaining public service activities or transferring them to others.

On the other hand, buyers in the international market are foreign consumers, producers, resellers, or the government.

Moreover, people are the main component of the market for goods or services. As one of the elements of the environment, population influences marketing.

Answer: The economic environment is the sum of the external factors that affect the purchasing power of consumers and the type of expenditure on a country’s economy.

The elements of the economic environment have an impact on the purchasing power of the consumer and the type of expenditure.

The two things that marketers need to keep an eye on are:

Answer: The natural environment is the environment that is formed by various natural elements such as rivers, canals, seas, mountains, climate, topography, etc.

Consumer awareness of the natural environment has greatly increased. Water pollution levels in many cities around the world have reached alarming proportions.

Answer: The technological environment is the result of combining science and technical education, related research, advanced technology use, technology import opportunities, and so on.

Every new technology removes the old technology from the market. So the marketer should get used to the technical environment and monitor it closely.

Companies that can’t keep up with the technological environment see their products quickly become obsolete.

Question 24: How does the Political and Social environment influence marketing?

Answer: The political and social environment is made up of the activities of various government agencies and social interest groups that influence marketing activities.

The political environment includes factors such as government stability, political ideology, vision, policies, and programs, transparency, accountability, people’s political thinking, and the country’s law and order situation, among others.

Question 25: What is the difference between Micro-environment and Macro environment?

Answer: The 3 most important differences between Micro-environment and Macro environment are as follows:

3 thoughts on “25 Important Marketing Environment Questions and Answers [Notes with PDF]”

Was helpful to me in my career as a marketer Thanks alot

Essay on Marketing Environment | Company

Here is an essay on ‘Marketing Environment’ for class 8, 9, 10, 11 and 12. Find paragraphs, long and short essays on ‘Marketing Environment’ especially written for school and college students.

Essay on Marketing Environment

Essay # 1. meaning and concept of marketing environment:.

Environment can be defined as everything which surrounds and influences a system. Marketing, also being one of the systems in business, has to respond to environmental change. Marketing activities cannot be carried out in isolation; instead it is constantly affected by the dynamic and every changing environment.

Marketing environment is dynamic since the firm needs to change its activities from time to time and place to place depending upon the prevailing situation. It is necessary for any business to adapt to the environmental changes in order to survive in today’s market.

These changes can be due to new competition entering into the market, or changes in political-legal-governmental scenario in a market, or changes in needs and wants of the customers, and so on.

While studying the market environment, the firm also needs to understand the threats and opportunities existing in that market in order to the gain maximum benefit; by designing and offering its products in such a way that they will satisfy the needs and wants of that particular market at that prevailing time.

According to Kotler, “A company’s marketing environment consists of the factors and forces outside marketing that affect management’s ability to build and maintain successful relationships with target customers”.

According to Biplab Bose, an organization’s marketing environment can be defined as “All institutions and forces that are external to the marketing organization that impinge or affect the term’s ability to develop and maintain timely, relevant and appropriate adaptations to such forces for successful business operation”.

A firm is influenced by internal environment as well as external environment. The environment which exists inside the firm is called as internal environmental. These include the employees, research and development, firm’s policies, firm’s finances, capital assets, firm’s structure, and the firm’s products.

Internal environmental factors affect the firm’s efficiency and can be controlled by the firm through implementation of various measures. Since these factors can be controlled by the company, these are called as controllable factors.

External environment influences the industry as a whole. Since the firm is not able to control its factors, these are called as uncontrollable factors. External environment is made up of Micro-environment and Marco-environment.

Marketers must be vigilant about both their internal and external environments. The marketers should try to make changes in the internal environment; however should change and adapt itself to external environment in order to succeed in the market.

Essay # 2. Macro and Micro Environment:

1. Micro-Environment:

Micro-environment of an organization comprises all those elements which are close to the firm and directly influence firm’s daily operations. These factors either interact with the firm or are involved in the same industry. The Micro-environmental factors include Customers, Suppliers and Vendors, Marketing Intermediaries, Competitors, and Publics.

i. Customers:

Customers are very important factor affecting any firm since customers generate profit. For any company, no customer means no business. Customers of the firm can belong to consumers markets, intermediary markets, industrial markets, resellers markets, government markets, and/or international markets. The customers’ needs and preferences keep changing and so does their loyalty toward the brand.

Therefore, the firm must be vigilant about the constantly changing needs and wants of its customers, and must make efforts to produce or improvise their products so as to satisfy these needs and wants.

This is possible through marketing research and marketing information system, in which firms can gather the information, analyze it, prepare or modify the products or services based on this analysis, and then communicate about these to the audience through different sources.

ii. Suppliers and Vendors:

Suppliers and vendors are one of the most important factors of a firm; especially for organizational selling companies. In organizational markets, suppliers of one company are most probably the customers of other companies. Raw material provided by the suppliers are further modified or assembled and then passed on to the end users.

Changes occurring in supplier’s environment affect the marketing functions of the firms. A firm should ensure availability of raw material in advance so as to ensure the timely delivery of products to its customers. Also role of suppliers is more important in those firms which operate in highly competitive markets; wherein there is very little differentiation between the products.

In such type of markets, the firm can gain a competitive advantage by passing on their goods to the customers at lower prices; however, in this case, the firm should be able to get the raw material at lowest possible price in order to pass on the benefit over cost savings to its end user. Usually in this type of markets, the buyers and sellers cooperate with each other in order to make the value chain efficient and pass on the value added products to the customers.

iii. Marketing Intermediaries:

Companies that help the firms in promoting, selling and distributing its goods to the final buyers are called as marketing intermediaries. These include physical distribution firms, middlemen, financial intermediaries, and marketing services agencies.

Role of marketing intermediaries are very important; especially in case of large-scale manufacturing firms, wherein it is very difficult, tedious, and costly proposition for the firms to take their manufactured products directly to the target market.

Physical distribution firms help the companies to stock their products and transport these from the manufacturer’s factory to its destination. Warehousing firms store and protect goods; transportation firms help the firms to move the goods.

Middlemen are businessmen who hold and sell the company’s products. These middle men help the company to find customers and/or close sales with them. The middlemen include agents, brokers, dealers, wholesalers, retailers, jobbers, etc.

Marketing services agencies are those independent companies which carry out other marketing related activities for the firms. These assist the firms to get their products to target market. Some of the marketing services agencies are marketing research firms, media and advertising agencies, marketing consultation firms, etc.

Financial intermediaries are the institutions which provide finance to the firms in terms of capital investment, or for buying and selling of the goods, and/or for insuring the goods against risk. Some of the financial institutions are banks, insurance companies, credit companies, etc.

iv. Competitors:

Company’s environment is always surrounded by competitors and is affected by the competitors. The level of competition in an industry plays an important role in success of any company. Every firm formulates its marketing plans and strategies by keeping its competitors’ activities in mind. The company can build its competitive advantage by studying its competitors’ position in the market as well as by analyzing competitor’s strengths and weaknesses.

When the industry is in introductory stage, the firms can easily enter the market due to less number of competitors and thus have a upper hand in the market; however, in the case of industry being in mature stage, since the competition in the industry will be high, the firm has to be more careful about its strategies as customer’s bargaining power will increase since more options will be available for the customers.

v. Publics:

There are wide range of other organizations and individuals in a firm’s micro-environment who can directly affect its marketing activities. Most of the times, these publics governs smooth functioning of the organisations. Company’s image is tarnished badly if any of these variables of the public’s propagates a negative image about the company. Therefore many companies develop a public relations department to establish constructive relations with the publics.

Some of the types of publics which surround the company are:

a. Financial – Banks, Stock brokers, Financial institutions

b. Media – Newspapers, Magazines, Radio, TV

c. Government regulatory agencies – Government departments

d. Citizen-action – Consumer organizations, Environment groups

e. Local community groups – Social groups like neighbourhood residence, community groups

f. General Public – Public perception, public opinion

g. Internal Employees – Workers, officers, board of directors

h. Pressure groups – Trade unions

2. Marco-Environment:

Macro-environment consists of all those elements which are beyond the immediate environment of the firms but even then they affect the organization. Thorough understanding of the macro-environment enables the firm to prepare its strategies in order to avail the opportunities present in the market and at the same time prepare measures against the threats in the market.

i. Economic Environment:

Economic environment plays a vital role in determining the demand of the product in a society. The firm is not only interested in the markets having high number of consumers but they are also interested in consumers with high disposable income. Disposable income of a consumer is the money which is available with him once all the taxes and expenses are paid.

The total buying power is function of gross income, take-home income, prices, savings, and credits. Gross Domestic Product (GDP) and Purchasing Power Parity (PPP) determines the economic status of a country. The demand for luxury products is more in the markets of developed countries where the economy is good and robust; however, in the markets of developing countries, where the economy is not so good, usual there is huge demand for products which are considered as necessities of life.

Economic cycle prevails in every country; and all companies operations are affected by the economic cycle prevailing in that country. Marketing firms are affected by the economic environmental variables such as monetary policy changes, business cycles, prevailing interest rates, changes in income levels, etc. Firms should always be vigilant of the four main trends in the economic environment viz. slowdown in growth of income, inflation pressure, consumers low savings tendency, and consumers changing expenditure patterns.

ii. Socio-Cultural Environment:

Socio-cultural environment is constituted of institutions and other forces that influence society’s basic values, perceptions, preferences, and behaviours. Therefore, it is important for the marketer to have a complete understanding of the cultural values of a society in which he is doing business or going to do his business.

This is especially true for those organizations which are planning to enter into markets of those countries whose cultural values are quite different from their own countries. Socio-cultural environment in a particular society moulds individual’s attitude, values, and lifestyles which lead to one’s taste and preferences. Attitudes towards specific products changes with time, and at any one time between different groups.

A product which is successful in one place might fail disastrously in other places. Buying destination also differ in different societies. The study of socio-cultural factors might help the marketer to understand the customers in terms of what do the customers buy, where they buy, when they buy, and how they use and dispose the products.

Religion, language, and upbringing are some of the socio-cultural factors. The persistent core values and secondary cultural values can affect the marketing decisions of consumers. The core cultural values of a consumer are deep rooted and do not change easily. Eg. Affinity towards locally produced products and aversion to foreign made products.

The secondary cultural values are more likely to change and can be easily shaped and manipulated, such as change in fashion trends due to influence of celebrities, etc. Marketers should have a keen interest in anticipating cultural shifts in order to spot new marketing opportunities or threats.

iii. Demographic Environment:

Demographic environment consists of characteristics of human populations such as population size; population density; geographic distribution; mobility trends; age distribution; gender distribution; marital status; racial, ethnic and religious status; changing age and family structures; geographical population shifts; educational characteristics; and population diversity.

Demographic environment has a big effect on the way people dress and consume. Eg. In present era as compared to the past, children are playing a significant role as influencer or initiator in a buying decision process. Therefore, the marketers are formulating marketing communications strategy by keeping these children in mind as their target audience.

iv. Political-Legal-Regulatory Environment:

Political environment is one of the less predictable elements in an organization marketing environment. The political environment consists of laws, government agencies, and pressure groups that limit various organizations and individuals in a given society.

Political and legal environment of a country affects the marketing systems. Government laws and legal practices depend upon the political system of the country. All businesses are directly or indirectly affected by changes in both domestic and international politics. Companies change their policies as per the changes in the political environment.

The political stability and the form of government adopted by the country are the important aspects which the marketer looks into before entering a particular market. Stability of political system affects the attractiveness of a particular national market. Government passed legislations directly and indirectly affects firms’ marketing opportunities.

Also, government laws collect revenues (taxes and duties). Companies make changes in their policies according to the laws and regulations set by the domestic and international bodies of the country. Government is responsible for protecting the public interest at large, imposing further constraints on the firm’s activities.

The government imposes the laws on marketing or businesses in order to:

i. Protect companies from each other,

ii. Protect consumers from unfair trade practices,

iii. Protect larger interests of society against unethical business behaviour.

Changing government agency’s enforcements and growth of public interest groups also brings in threats and challenges.

Other than the country’s political environment, other political organizations which can directly or indirectly affect the companies include trading blocs such as EU, ASEAN, etc. or worldwide inter-governmental organizations such as WTO, IMF, etc.

v. Technical/Technological Environment:

Technological changes have brought numerous changes in human lives in all the fields. Technology discoveries and developments create opportunities and threats in market. The marketer has to keep in view today’s technology while formulating its marketing activities.

Emergence of new technologies offer new goods and services to consumers; allows existing product to be made more cheaply, thereby widening their market through being able to charge lower prices; allows new methods of distributing goods and service; and develops new opportunities for companies to communicate with their target customers.

Since technological changes needs its own cost and investment in research and development; technological development will be more visible in those societies where financial resources are available to meet these expenses and less visible in comparatively poorer societies.

It should be also taken into consideration that technological changes have brought in artificial demand and faster obsolescence of the products. Therefore the companies have to constantly need to upgrade their products or bring new products into the market in an attempt to survive in the market.

vi. Environmental/Natural Environment:

Natural resources, which are needed by the marketers as inputs for producing their products, constitutes of environmental environment or natural environment. It also includes those natural resources which are affected by the marketing activities. In the present era, environmental issues are one of the major problems.

If appropriate measures are not taken soon then the world will have to face consequences of ecological disasters like Global warming. New legislations are being brought in, which forces the companies to invest in pollution-control equipment’s and set-ups. Under natural environment, some of the trends about which marketer should be aware of are concerns regarding shortage of raw materials and increased pollution, and increased governmental intervention in natural resources management.

The companies should understand their environmental responsibilities and commit themselves to the “green movement”. In order to cater to these needs, some of the companies have started to market eco-friendly products; while some other companies are trying to restore the ecological balance and replete the resources by taking up initiative which causes minimum damage to the ecology.

Essay # 3. Linkage of Marketing Function with all Functions in the Organisation:

It is usually believed that marketing is just concerned with its customers and competitors. However, marketing department do not work in isolation but is interrelated with other organizational functions.

a. Marketing and Finance:

Marketing and Finance are closely associated with each other. Cost and profit of a product are presented in monetary values or in terms of sales percentage. Financial tools like budgeting and profitability analysis are key aspects of marketing planning and control. Marketing decisions are viewed as investment decisions.

Different financial instruments and criteria are used to evaluate the marketing mix elements decisions in terms of investment in new products, advertising, promotion, price, and distribution. Finance also requires marketing inputs for executing and explaining various financial plans in terms of capital requirements, cash flow analysis, credit, and other financial policies. Marketing plan inputs such as sales and revenue forecasts are important for any financial planning.

Marketing approach towards financial decisions offers:

i. Marketing communication campaign uses financial tools like annual financial reports and other reports to address to the financial community regarding the firm’s annual status;

ii. Changes in financial variables such as price of product, payment methods, and discounts and credits are evaluated on the basis of markets response in terms of sales.

iii. Various financial performance indicators are applied while determining market segments for certain products;

iv. Investor’s expectations and fluctuations in market prices of the shares determine the impact of different marketing activities carried out by the firm.

b. Marketing and Production:

Marketing and production goes hand-in-hand. At one end it is necessary for the marketer to determine in advance about what can be the demand for its products in the market in order to manage production capacities efficiently; and on the other hand production capabilities determine number and type of the products which can be marketed.

Based on the fluctuations and product demand in the market, production manager can either change production capacities by making changes in current resources, or by improving inventory management, or by subcontracting; or influence the nature, level, or timing of demand in agreement with the production capacity constraints.

For implementing such strategies, detailed information about market responses to such strategic moves are required. Interdependency between marketing and production is mostly important in case of new product development in which the relationship between the design of new products and production facilities is based on demand for the new product, time, and space distribution. Also scheduling the launch of new product is also important so that it does not cannibalize the company’s existing product.

c. Marketing and Procurement:

In the era of shortage of raw material, procurement has become an important function.

Many companies are forced to either modify their products to cope with lack of raw materials, or replace them with more easily obtained or cheaper materials. Marketing research helps the procurement department to study whether the consumers will accept the product which is used by using modified goods.

On the other hand, marketing plans requires inputs from the procurement in order to identify new suppliers of raw materials or anticipated changes in production activities due to changes in supply of raw material.

d. Marketing and Research and Development:

Marketing and research and development are closely related in any organization. Major link between R&D and marketing revolve around the new product development efforts of the organisation. Each of the new product development stage requires close interaction between marketing and R&D.

Marketing research rarely gives innovative product ideas; however, engineers can generate and evaluate new product ideas by studying consumer’s unsolved problems and needs, or expectations which is collected during the market survey.

e. Marketing and Personnel:

Personnel department deals with hiring, training, and management of the appropriate marketing personnel. Marketing should collaborate with the personnel department for developing job descriptions, screening candidates, and designing training programs and incentive systems. Marketing research, as a specialized marketing activity, could provide valuable help in the design and implementation of a number of personnel research projects.

Essay # 4. Concept of Marketing Potential and Market Share:

Marketing Potential:

“Market potential is the valuation of the sales revenue from all the supplying channels in a market during a certain period.” In order to determine the economic viability of the project, the estimation of market potential is important.

Estimation of market potential enables to marketer to evaluate whether his business is capable of fulfilling the needs of the market segment which they have decided to target. Market potential analysis leads to projection of sales and profits of a company.

While estimating the market potential, the marketer should take the following points into consideration:

i. Estimated number of customers to be targeted.

ii. Targeted customers characteristics.

iii. Geographical location of these targeted customers.

iv. Price that these customers are willing to pay for a particular product or service.

v. Usage frequency of the product by the prospective customers.

vi. Further scope for development of this market.

vii. Share of the company.

Steps involved in estimating market potential are:

i. Determination of target market and market segments.

ii. Determination of market size.

iii. Determination of geographic boundaries of product market.

iv. Study the competitors.

v. Estimation of market share.

vi. Determination of average annual consumption of the product.

vii. Arriving at an average selling price.

Market Potential can be calculated as:

MP = N*MS*P*Q

MP = Market potential

N = Total number of potential consumers

MS = Market share i.e. percent of consumers buying from you.

P = Average selling price

Q = Average annual consumption

Market Share:

“The percentage of an industry or market’s total sales that is earned by a particular company over a specified time period” is called as market share”. Market share is calculated by dividing the company’s sales over the period by the total sales of the industry over the same period.

Market Share = Company’s Sales/Total Market Sales

The term market share is used by companies to determine their competitive strengths in a sector as compared to other companies in same sector and also to evaluate annual performance.

To determine the true performance of a firm in a particular time period, the marketers use market share instead of sales figures. This is done, since the later cannot be the true indicator of firm’s performance as increased sales can also be a result of improvement in overall market condition.

Following are the reasons due to which the companies try to increase their market share:

i. By increasing the market share, the company can continue to grow even if the industry stops growing,

ii. Higher market share helps the company to achieve greater economies of scale,

iii. Higher market share increases the company’s bargaining power with suppliers as well as customers,

iv. Increased market share helps to increase the Brand reputation.

Ways to increase market share:

Market Share = Share of Preference*Share of Voice*Share of Distribution

Therefore Market share can be increased if:

i. Share of preference can be increased by better product or pricing,

ii. Share of voice can be increased through better advertising and communication efforts,

iii. Share of distribution can be increased through more intensive distribution.

Reasons for a company for not increasing the market shares can be:

i. If increase in market share may lead to spending too much on advertising which might result in fall in the net profit of the company then in this case the market share will not be increased by the company.

ii. If price reduction strategy of a company makes the company to lose ground in front of bigger competitors during the price wars then the company might think of not increasing its marketing share.

iii. If niche player increases its market share, then bigger companies may get attracted to enter that niche market. Due to this the niche players do not go for increasing the market share in order to avoid the invasion of bigger market players.

iv. If a firm increases its market share beyond the production capacity, it may have to add facilities, if the additional facilities are underutilized, then the company incurs losses. Due to this the firm might not think of increasing its market share.

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Mastering IELTS Writing Task 2: The Environmental Impact of Fast Fashion

The Environmental Impact Of Fast Fashion has become an increasingly prevalent topic in IELTS Writing Task 2 essays. Given its relevance to contemporary global issues, this subject is likely to appear more frequently in future exams. Based on recent trends and past exam questions, here are a few potential prompts related to this theme:

Some people believe that the fast fashion industry is primarily responsible for environmental degradation. To what extent do you agree or disagree?

The fast fashion industry has been criticized for its negative impact on the environment. What measures can be taken to address this issue?

Discuss the advantages and disadvantages of the fast fashion industry, considering its environmental impact.

For this article, we’ll focus on the second prompt, as it offers a comprehensive approach to discussing the environmental impact of fast fashion while encouraging critical thinking about potential solutions.

Table of Contents

• 1 Analyzing the Essay Prompt
• 2 Sample Essay
• 3 Writing Tips
• 4 Key Vocabulary
• 5 Conclusion

Analyzing the Essay Prompt

This prompt requires candidates to:

• Understand the concept of fast fashion and its environmental implications
• Identify and explain specific measures to mitigate the negative environmental impact
• Provide a well-structured response with clear examples and explanations

Sample Essay

Here’s a sample essay addressing the given prompt:

The fast fashion industry, characterized by rapid production cycles and low-cost clothing, has come under scrutiny for its detrimental effects on the environment. This essay will discuss several measures that can be implemented to address the environmental concerns associated with fast fashion.

One of the most effective measures is to promote sustainable production practices within the industry. Companies can invest in eco-friendly materials, such as organic cotton or recycled fabrics, to reduce their environmental footprint. Additionally, implementing water-saving technologies and reducing the use of harmful chemicals in the dyeing process can significantly minimize pollution. For instance, major brands like H&M and Zara have already begun incorporating sustainable materials into their product lines and setting targets for reducing water usage in their manufacturing processes.

Another crucial step is to encourage consumers to adopt more sustainable shopping habits. This can be achieved through education campaigns that raise awareness about the environmental impact of fast fashion and promote the benefits of buying higher-quality, longer-lasting garments. Governments and NGOs can play a vital role in this by organizing public awareness programs and incorporating sustainability education into school curricula. Furthermore, incentivizing second-hand shopping and clothing rental services can help reduce the demand for new fast fashion items.

Implementing stricter regulations on the fashion industry is also essential. Governments can introduce legislation that requires fashion brands to disclose their environmental impact, set mandatory recycling targets, and impose penalties for excessive waste generation. The European Union, for example, has proposed new regulations that would make textile producers responsible for the entire lifecycle of their products, including disposal and recycling.

Lastly, investing in innovative recycling technologies can help address the issue of textile waste. Developing advanced recycling methods that can efficiently process mixed fabrics and transform them into new materials would significantly reduce the amount of clothing ending up in landfills. Companies like Renewcell and Evrnu are pioneering such technologies, creating new fibers from discarded textiles that can be used to produce high-quality garments.

In conclusion, addressing the environmental impact of fast fashion requires a multi-faceted approach involving sustainable production practices, consumer education, stricter regulations, and technological innovation. By implementing these measures, we can work towards a more sustainable fashion industry that balances style with environmental responsibility.

(Word count: 365)

Writing Tips

When tackling this topic in your IELTS Writing Task 2 essay, consider the following tips:

Use specific examples : Incorporate real-world examples of companies, technologies, or initiatives to support your arguments.

Demonstrate topic knowledge : Show your understanding of the fast fashion industry and its environmental impact through relevant vocabulary and concepts.

Structure your essay clearly : Use clear paragraphs, each focusing on a distinct measure or solution.

Use linking words : Employ transition phrases to connect your ideas smoothly and improve the overall coherence of your essay.

Balance your argument : While the prompt asks for measures to address the issue, you can briefly acknowledge the challenges in implementing these solutions for a more nuanced response.

Key Vocabulary

Here are some essential vocabulary items to help you write effectively about this topic:

Fast fashion (noun) – /fɑːst ˈfæʃ.ən/ – Inexpensive clothing produced rapidly by mass-market retailers in response to the latest trends

Sustainable (adjective) – /səˈsteɪ.nə.bəl/ – Causing little or no damage to the environment and therefore able to continue for a long time

Environmental footprint (noun) – /ɪnˌvaɪ.rənˈmen.təl ˈfʊt.prɪnt/ – The impact of human activities on the environment, measured in terms of resource use and pollution

Textile waste (noun) – /ˈtek.staɪl weɪst/ – Discarded clothing and other fabric-based materials

Eco-friendly (adjective) – /ˈiː.kəʊ ˈfrend.li/ – Not harmful to the environment

Recycling (noun) – /riːˈsaɪ.klɪŋ/ – The process of converting waste materials into new materials and objects

Consumption patterns (noun) – /kənˈsʌmp.ʃən ˈpæt.ənz/ – The way in which people acquire and use goods and services

Biodegradable (adjective) – /ˌbaɪ.əʊ.dɪˈɡreɪ.də.bəl/ – Capable of being decomposed by bacteria or other living organisms

Circular economy (noun) – /ˈsɜː.kjə.lər iˈkɒn.ə.mi/ – An economic system aimed at eliminating waste and the continual use of resources

Upcycling (noun) – /ˈʌpˌsaɪ.klɪŋ/ – The process of transforming by-products, waste materials, or unwanted products into new materials or products of better quality or environmental value

The environmental impact of fast fashion is a critical topic that is likely to appear in future IELTS Writing Task 2 exams. By understanding the issue and being prepared to discuss potential solutions, you’ll be well-equipped to tackle such prompts. Remember to practice writing essays on related topics, such as:

• The role of consumer behavior in driving fast fashion trends
• The economic implications of shifting towards sustainable fashion
• The responsibility of governments versus corporations in addressing fashion industry pollution

By expanding your knowledge and honing your writing skills on this subject, you’ll be better prepared for your IELTS exam and able to contribute meaningfully to discussions on this important global issue.

• IELTS essay samples
• Vocabulary List

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