MACRO ENVIRONMENT

1.DEMOGRAPHIC ENVIRONMENT
Demography is the study of human populations in terms of size, density, location, age, gender,
race, occupation, and other statistics.

Demographic trends include age, family structure, geographic population shifts, educational
characteristics, and population diversity.

The 3 largest age groups are the baby boomers, Generation X, and Millennials.

 The Baby Boomers between 1946 and 1964 Generation X is the generation of people
born between 1965 and 1976.
 The Millennials (or Generation Y) are born between 1977 and 2000

2.ECONOMIC

Economic environment consists of factors that affect consumer purchasing power and spending
patterns

 Changes in Income
 Changing consumer spending patterns

Different companies appeal to different income segments.

Ex: Tata Nano, the world’s cheapest car: To capture India’s growing middle class, Tata Motors
introduced the small, affordable Tata Nano car.

The Tata Nano was released for the price of $2,000.

 In Dec 2018: It produced 82 units and sold88 units.

 In Dec 2019: They had zero production, and sold just 1 unit in Feb 2019

3.NATURAL

Natural environment: Involves the natural resources that are needed as inputs by marketers, or
affected by marketing activities.

Trends include shortages of raw materials, increased pollution, increased government

intervention and a greater attention to environmentally sustainable strategies.

4.TECHNOLOGICAL

Technology is the most dramatic force in changing the marketplace. It creates new products and
opportunities, and kills off older products.
Example:
-PS5 | Haptic Feedback: Experience haptic feedback via the DualSense wireless controller in
select PS5 titles and feel the effects and impact of your in-game actions through dynamic sensory
feedback.

-A robotic scientist - that could increase the pace of scientific discovery - has been developed by
researchers at the University of Liverpool.

Artificial intelligence and robotics will be vital in keeping research and development - including
the search for coronavirus treatments - moving quickly at a time of social distancing, when fewer
human scientists will be able to get back into their labs.

5.POLITICAL

Political/ Legal environment: Laws, government agencies, and pressure groups that influence or
limit various organizations and individuals in a given society

Business legislation has three main purposes:

 to protect companies from unfair competition

 to protect consumers from unfair business practices, and
 to protect the interests of society from unbridled business behaviour

6.CULTURAL

Cultural environment consists of institutions and other forces that affect a society’s basic values,
perceptions, and behaviours

People grow up in a particular society that shapes their basic beliefs and values.

They absorb a world view that defines their relationships with others

Persistence of Cultural Values:

 Core beliefs and values persist because they are passed on from parents to children and
are reinforced by schools, churches, business, and government.
 Secondary beliefs and values are more open to change.
 Marketers want to predict cultural shifts in order to spot new opportunities or threats.
 E.g. K-beauty, J-beauty