MARKETING THEORIES – THE MARKETING ENVIRONMENT

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MARKETING THEORIES – THE MARKETING ENVIRONMENT

The marketing environment is considered as part of the marketing planning process and explores various internal and external forces that might affect a business and its capacity to operate. This can be anything from technological and cultural forces to influences such as suppliers, customers and competitors.

Some of these factors are manageable but others can be beyond a firm’s control (e.g. legal and political structures). Being aware of the marketing environment means companies can effectively map out their marketing activity to overcome any negative influences they might encounter.

The Model


The Internal Environment

The internal environment considers everything inside of the bounds of the company. This includes staff at all levels and from all departments, financial and management decisions / influences and more. Factors in the internal environment can be controlled by the organization.

Examples:

  • Staff members – all departments e.g. management, finance, research and development, purchasing, business operations and accounting
  • Capital assets
  • Company policy
  • Logistics
  • Inventory

A change in the internal environment could include a new hire or a change in company policy.

The Micro Environment

This is everything within the firm’s immediate reach. They are forces associated with how the company operates day-to-day and the business has some control over these areas.

Examples:

  • Customers – consumer market, B2B, international market
  • Competitors
  • Suppliers
  • Distributors
  • Strategic partners/shareholders e.g. intermediaries, agencies, accountants
  • Publics – interest groups, environmental groups, the media

The Macro Environment

The macro environment refers to influences in wider society. These factors can impact the micro environment and an organisation is unable to control them. Businesses must choose areas to focus on that are most relevant to their organisation and the way they operate.

A PESTELE framework can be used to analyze the forces within the macro environment. This is an extension of the PESTEL model and includes the extra E (ethical) to take into consideration areas such as confidentiality and business ethics.

A change in the macro environment could be a new law affecting businesses, technological breakthroughs, a recession, austerity or a large spike in unemployment.


Social/Cultural: demographics, population growth/decline, age distribution, education, cultural differences, lifestyle trends, health and welfare, career attitudes 

Technological: new innovation, big data, Internet of things, automation, research, tech awareness, technological growth, skilled resources, smart phones, advanced AI, tracking, location data 

Economic: national and international economic growth/decline, exchange rates, interest rates, inflation, purchasing power, employment rates, income, investment opportunities 

Ethical: bribery, intellectual property, reputation, business ethics/morals, confidentiality, privacy

Political: government policy, taxation, political stability, foreign trade, trade restrictions 

Legal: court system, employment law, discrimination law, anti-trust law, trade unions, consumer protection, health & safety, copyright law, GDPR

Environmental: weather, climate change, emissions, environmental policies, pressure from NGO's, natural disasters 

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