MARKETING

ENVIRONMEN
T
And it’s Impact
on Marketing
Effort

Assignment of
Prepared by:
GROUP
01 Osama Ahmed
A
02 Abeeha Jalal
03 Afia Afaq
04 Muhammad Shehzad
Gul
05 Muhammad Umair
Sharif

Submitted to:
Dr Shameel Ahmed
Zubairi
Executive Summary:
Micro and macro environments have a significant impact on the success of marketing
activities, and therefore such environmental factors must be considered in-depth during
the process of creating a strategic marketing plan.
Table of Contents:
 Environmental Factors (Microenvironment
and Macroenvironment) (pp )
 Demographic and economic environments
and its effect on marketing. (pp )
 Natural and technological environment.
(pp )
 Social and Cultural environment and its
impact on markets. (pp )
 Responds to the marketing environment.
(pp )
 Environmental Factors:

Strategic planning is the formal consideration of an organization’s future course. All strategic
planning deals with at least one of three key questions:

1. “What do we do?”
2. “For whom do we do it?”
3. “How do we excel?”

No conversation of vital arranging can disregard the miniature and large scale factors that are
pertinent in the achievement and conceivable disappointment of the retail business. The business
climate is an advertising term and alludes to variables and powers that influence an association's
capacity to construct and keep up effective client connections.

1. Micro (internal) environment – small forces within the company that affect its ability to
serve its customers.
2. Internal environment – can be controlled, however, it can’t influence an external
environment.
3. Macro (external) environment – larger societal forces that affect the microenvironment.

Micro Environmental Factors

Micro environments in retail is anything in the immediate environment including suppliers,

customers, competitors, and stakeholders.  Any government and other regulating body can be
thought of as a stakeholder.  Typically the micro environment is local to the business and any
business owner should be well aware of those factors affecting the retail business.

Macro Environmental Factors

Macro environments are often outside of the

retailer’s control and are typically of a larger scale
and are usually of an economic and industry
viewpoint.

SWOT Analysis

In understanding micro and macro environments a

SWOT (Strengths, Weaknesses, Opportunities,
and Threats) analysis is commonly used in retail.

Micro Environment Factors

  Suppliers: Suppliers can control the success of the business when they hold power. The
supplier holds the power when they are the only or the largest supplier of their goods..

 Resellers: If the product the organization produces is taken to market by 3rd party

resellers or market intermediaries such as retailers, wholesalers, etc. then the marketing
success is impacted by those 3rd party resellers

 Customers: Who the customers are (B2B or B2C, local or international, etc.) and their
reasons for buying the product will play a large role in how you approach the marketing
of your products and services to them.

 Competitors: Those who sell the same or similar products and services as your
organization and the way they sell needs to be taken into account.

 The Public: Your organization has a duty to satisfy the public. Any actions of your
company must be considered from the angle of the general public and how they are
affected. The public has the power to help you reach your goals; just as they can also
prevent you from achieving them.

Macro Environment Factors

 Demographic forces: Different market segments are typically impacted by common

demographic forces, including country/region; age; ethnicity; education level; household
lifestyle; cultural characteristics and movements.

 Economic factors: The economic environment can impact both the organization’s

production and the consumer’s decision-making process.

 Natural/physical forces: The Earth’s renewal of its natural resources such as forests,
agricultural products, marine products, etc must be taken into account.

 Technological factors: The skills and the technology and materials needed for the
production of products and services can also impact the smooth running of the business
and must be considered.

 Political and legal forces: Sound marketing decisions should always take into account
political and/or legal developments relating to the organization and its markets.

 Social and cultural forces: The impact the products and services your organizations
brings to market have on society must be considered.

SAMSUNG COMPANY

Samsung was founded by Lee Byung-chul. In 1938 Samsung was born as a company that was
dealing with fruit & vegetable and dried fish. The company was exporting its product from South
Korea to Beijing in China. In 1969, Samsung Electronics was born. From there, the company
started acquiring and creating different business establishments including a hospital, paper
manufacturing plant, life insurance company, department stores and many others
In 1974, Samsung electronics acquired half of Korea Semiconductor -this made it the leading
electronics manufacturer in the country.In eighties Samsung Electronics merged with Samsung
Semiconductors and Telecommunications.

MICRO ENVIRONMENT ANALYSIS OF SAMSUNG

The aim of this section is to conduct an internal environment analysis of Samsung which will
investigate the environment in which Samsung operates in. components of the analysis will be
those in which the company has control over, as known as internal environment.

Strength:

Samsung is the second biggest telecommunication industry in the world through its innovation
smart phone.Samsung is leading in design features. For example Samsung is the first one to
produce dual screen phones, and they have a thinnest and lightest note pad ever.

Weakness
 Their prices are low, hence their product loss value easy in the market

 They launch a new phone after another that can cause confusion to the customers.

 Poor creativity in terms of software, mostly they steal Apples software ideas

 Their products are not use friendly, as compare to Nokia phones

 They are leading in hardware but they have too much dependence for their software from
other parts.

EXTERNAL ENVIRONMENT ANALYSIS OF SAMSUNG

Opportunity:

Samsung need to introduce user friendly products and educate their market about their product.
Samsung could launch no name brand like MTN and Vodafone whereby they will take the out
date old model, change only a cover and sell with cheaper price.

Threats

Low cost competitors from China can affect Samsung. All Samsung competitors bought their
product parts in China that can lead a future fall to Samsung. Apple is dominating in South and
North America, and builds its brand to make any new difficult to operate there.

1. THE DEMOGRAPHIC AND ECONOMIC ENVIRONMENT:

1.1. The Demographic Environment:
The word demography itself is defined as the study of human population in terms of size,
density, diversity, location, age, gender, race, family systems, changing role of women,
education, occupation and other statistics. Various traits are used to determine product
preferences or buying behaviors of consumers that have major implications on the business and
marketing macro environment are as follows:

1.1.1. Increasing Population:

Population size will affect future market demand through prices and supply elasticity.

1.1.2. Changing Age Structure of Population:

The aging of the population will have a significant impact on markets and those who service
them. If we take the U.S. population contains several generational groups divided pretty much in
four largest groups – the baby boomers, Generation X, the Millennials, and Generation Z
and their impact on today’s marketing strategies.

1.1.3. Growing Middle Class:

Social-class groups or several income groups such as wealthy, middle, and lower classes. The
rich, for instance, may want different products than middle and lower classes, and may be willing
to pay more. It is an important factor to indicate level of wealth and quality of life.

1.1.4. Rural Population:

Due to availability of basic infrastructural facilities, business units can easily reach the target
rural buyers for example; in 2017 markets in the urban regions started shifting from analog to
digital phones, sales of analog technology based telephones increased in rural areas.

Since demand and consumption growth is increasing due to growing number of rural population,
organizations are interested to increase the production and improve marketing efforts to meet
their demands.

1.1.5. Generational Marketing:

They experience rapid growth in their sales by introducing separate clothing range for different
events such as party wear, wedding wear, casual wear and office wear.

Lifestyle, life stage or the common values the consumers seek in the products they buy instead of
age is more effective way of population segmentation to increase the marketing efficiency.

1.1.6. The Changing Family

System:

Today, both male and female

strata of society works to
manage financial needs. Also,
there is a rapid shift from joint family system to nuclear families globally. This factor combined
with the increase in family income have resulted in growth of real estate market. For example,
there has been a huge demand of residential flats among all segments in Pakistan. Hence varying
family structures plays an important role in ensuring effective marketing efforts.

1.1.8. A More Educated and Professional Population:

The rising number of educated population have immensely increase the demand for quality
products and better service as well as educational material such as books, learning services etc.

For example, in recent times of Corona Virus, tele-commution organizatons are making
efforts to provide efficient and effective digital and networking services for better work
from home results.

1.1.9. Increasing Diversity:

Consider an example of Christmas festival in Pakistan named Easter. Due to growing demand of
chocolates in the Easter season, different chocolate manufacturing companies offer deals and
discounts to customers to increase their sales. Both nationally and internationally, markets are
experiencing diversity in needs and wants of the consumers.

Recently a well-known tea

manufacturing brand “Tapal Family
Mixture” have released an
advertisement in which a candidate
experiencing a speech disorder called
“stammering” gives a job interview
with courage and confidence.

1.2. Economic Environment:

The term economic environment refers

to all the external economic factors that
influence buying habits of consumers
and businesses and therefore affect the
performance of a company.

Consider an example of Daraz 11.11 sale where the online market place offers products at
discounted prices.

More Over, Aurora pens are manufactured especially for elite class whereas parker pen
are mostly used by middle income earners.

3. THE NATURAL & TECHNOLOGICAL ENVIRONMENT

3.1. The Natural Environment

The natural environment is another important factor of the macro-environment. Natural

Environment involves physical environment and natural resources that are needed as input by
marketers and capable of affecting the marketing activities. There is a huge possibility that
unexpected things can occur in physical environment For example, companies like FedEx, they

The Natural Environment show three major type of trends and marketers should be aware of
these trends in the natural environment:

 Shortage of certain Raw Material

 Increase in Pollution Level
 Government Intervention in Natural Resource Management

3.1.1. Shortage of Certain Raw Material

Shortage of water and non-renewable resources can be considered as the big example. Although
water seems to be an infinite resource but many countries all around the world suffering from
water crisis including India and Pakistan. Renewable resources such as forest, and non-
renewable resources such as coal, oil, and various minerals needs to be utilized properly for
future concern. As raw materials become increasingly scarcer, the ability to create a company's
product gets much harder.

3.1.2. Increase in Pollution Level

Growing numbers of industries is a big reason of damage of natural environment. Disposal of

chemical and nuclear waste, dangerous mercury level in ocean, quantity of chemical pollutant in
soil, non-biodegradable plastic, bottles and other littering and packaging material is the main
cause of damage natural environment. Pollution can go as far as negatively affecting a company's
reputation if they are known for damaging the environment.

3.1.3. Government Intervention in Natural Resource Management

Government of different countries promote a clean environment. Government Intervention make

it increasingly harder for a company to fulfill their goals as requirements get more stringent.

3.2. Environmental Sustainability

Concern for natural environment has create an Environmental Sustainability Movement. Now
companies are developing strategies and practices that create a world economy that the planet
can support indefinitely.

“Environmental Sustainability mean meeting present needs without compromising the

ability of future generation to meet their needs.”
Companies are trying to respond to their customers in more environment friendly way by
developing recyclable or biodegradable packaging, recycled material and components, better
pollution control and energy-efficient operations.

Consider example of Walmart:

“Walmart has emerged inb recent years as the world’s super “eco-nanny” through its own
sustainability practices and its impacts on the actions of supplier.”

Consider example of McDonald’s:

“McDonald’s has made a substantial commitment to the Green Movement.”

Companies are learning what is good to their customer as well as good for their planet. More and
more companies are making environmental sustainability a part of their core mission.

3.3 The Technological Environment

Technology Environment is rapidly changing force which creates many new marketing
opportunities but at the same time many existing products extinct due to rapid change in
technology. To understand the different spending patterns, marketers need to also take into
consideration about the development of digital technology and its effect on market growth and
employment. Technology has created such wonders in the field of medicines, science, robotics,
auto mobiles and internet but with the same time released such horror such as nuclear missiles
and ammunitions. Technology Environment changes rapidly by creating new products and
opportunities.

THE SOCIAL AND CULTURAL ENVIRONMENT

The cultural environment consists of the influence of religious, family, educational, and social
systems in the marketing system. While the differences between our cultural background in the
United States and those of foreign nations may seem small, marketers who ignore these
differences risk failure in implementing marketing programs.

This task is not as easy as it sounds as various features of a culture can create an illusion of
similarity. For example, in the US we purchase “cans” of various grocery products, but the
British purchase “tins”. A number of cultural differences can cause marketers problems in
attempting to market their products overseas. These include: (a) language, (b) color, (c) customs
and taboos, (d) values, (e) aesthetics, (f) time, (g) business norms, (h) religion, and (i) social
structures. im (g) business norms, (h) religion, and (i) social structures. Example

I travel out of the country to Mexico almost every year. I can see the immense cultural
differences between Mexico and the United States, from the language to colors, to the values,
religious beliefs, and business norms. As soon as I step out of the plane in Mexico, I feel like I
am in a different world. In terms of the language, the primary is obviously Spanish; however, in
the past few years, I have noticed signs in the airport with translations to English and Chinese. In
terms of values, they seem to focus more on survival. For example, marketing food, shelter
products, and clothing. Their religious beliefs are centered around Catholicism.

Elizabeth Garcia

Language: Language differences cause many problems for marketers in designing advertising
campaigns and product labels. Language problems become even more serious once the people of
a country speak several languages. The importance of language differences cannot be
overemphasized, as there are almost 3,000 languages in the world.

Colors: Colors also have different meanings in different cultures. For example, in Egypt, the
country’s national color of green is considered unacceptable for packaging, because religious
leaders once wore it.

Values: An individual’s values arise from his/her moral or religious beliefs and are learned
through experiences. For example, in America, we place a very high value on material well-
being and are much more likely to purchase status symbols than people in India. Similarly, in
India, the Hindu religion forbids the consumption of beef, and fast-food restaurants such as
McDonald’s and Burger King would encounter tremendous difficulties without product
modification.

Aesthetics: The term aesthetics is used to refer to the concepts of beauty and good taste. The
phrase, “Beauty is in the eye of the beholder” is a very appropriate description for the differences
in aesthetics that exist between cultures. For example, Americans believe that suntans are
attractive, youthful, and healthy. However, the Japanese do not.

Time: Americans seem to be fanatical about time when compared to other cultures. However,
salespeople who set definite appointments for sales calls in the Middle East and Latin America
will have a lot of time on their hands, as business people from both of these cultures are far less
bound by time constraints.

Religious Beliefs: A person’s religious beliefs can affect shopping patterns and products
purchased in addition to his/her values, as discussed earlier. Women do not participate in
household buying decisions in countries in which religion serves as opposition to women’s rights
movements. But for other religions, religious holidays do not serve as popular times for
purchasing products. In the United States and other Christian nations, Christmastime is a major
sales period. 
IMPORTANCE OF CULTURE ON MARKETS

There are five essential areas within which culture must be continually studied in order to
achieve success in dealing with culture as it affects international marketing.

 culture impacts on marketing (international versus domestic)

 cross-cultural dimensions of marketing research
 cross-cultural aspects of the marketing mix (products, price, promotion, and place)
 cross-cultural marketing education and professional training
 and cross-cultural practice in electronic marketing

Student Example

McDonald’s has done a great job introducing its chain around the world and moving into
numerous markets and cultures. One location that I think is a great example of cross-cultural
marketing is McDonald’s in France. The French have a very different culture than the United
States. They live their life at a much slower pace and their meals are more about socializing and
enjoying the time with people rather than eating and getting out. McDonald’s has created some
new menu items for their French locations such as an Alpine burger and the McBaguette.
McDonald’s also designed the French chains so that they are more spacious and decorated
tastefully so that it does encourage the French to sit down and enjoy their meal at their own
pace. 

Micro and macro environment

https://courses.lumenlearning.co
http://www.streetdirectory.com/travel_guide/116664/electronics/the_history_of_samsung.html
https://www.marketing91.com

Demographic and economic environment

1. https://open.lib.umn.edu/exploringbusiness/chapter/9-8-the-marketing-environment/

2. https://www.linkedin.com/pulse/how-changes-demographic-economic-environments-affect-
marketing-andre

3. https://courses.lumenlearning.com/marketing-spring2016/chapter/reading-demographic-
factors-shaping-the-global-marketing-environment/#:~:text=Based%20on%20demographic
%20data%2C%20marketers,how%20to%20achieve%20maximum%20results.

4. https://smallbusiness.chron.com/economic-factors-affecting-marketing-1699.html
5. https://marketbusinessnews.com/financial-glossary/economic-environment/

Natural and technological environment

https://slideplayer.com/slide/4963491/
https://en.wikipedia.org/wiki/Market_environment
https://2012books.lardbucket.org/books/an-introduction-to-business-v2.0/s13-08-the-marketing-
environment.html

Social and technological environment

https://opentext.wsu.edu/cpim/chapter/3-2-the-social-and-cultural-environment/