Marketing information consists of people,

equipment and procedures to gather, sort,

analyze, evaluate and distribute needed,
timely and accurate information to marketing
decision makers.
Marketing decision makers use the data to
identify and solve marketing related
problems.
"A marketing information system is a
continuing and interacting structure of
people, equipment and procedures to
gather, sort, analyse, evaluate, and
distribute pertinent, timely and accurate
information for use by marketing decision
makers to improve their marketing planning,
implementation, and control".
‘MIS is a set of procedures and methods for
the regular, planned collection, analysis and
presentation of information for use in
marketing decisions’

American Marketing Association What

is marketing information system ?
A MKDSS is used to support the software
vendors' planning strategy for marketing
products.
It can help to identify advantageous levels of
pricing, advertising spending, and
advertising copy for the firm's products. This
helps determine the firm's marketing mix for
product software.
 contd.
Decision support system examples include
manual systems, hybrid systems, all types of
analytics as well as sophisticated decision
support software
The Marketing Environment

15
16
“It is useless to tell a river to stop running; the
best thing is to learn how to swim in the
direction it is flowing.”
-Anonymous
• Environment refers to the entirety of
circumstances surrounding an
organism or group of organisms,
particularly the combination of external
physical conditions that influence
growth, progress, and survival of
organisms.
• It is synonymous to territory and locale.

18
 Learning Objectives

1. Learn, understand and define Market

3. Describe the environmental forces that affect a company’s ability to serve

its customers

4. Explain how changes in the demographic and economic environments

affect marketing decisions

5. Identify the major trends in a firm’s natural and technological environments

6. Explain the key changes that occur in the political and cultural
environments

7. Discuss how companies can react to the marketing environment

19
Boiled egg

20
21
 THE MARKETING
ENVIRONMENT
• The forces that directly and indirectly influence an
organization’s capability to undertake its business.

• The trading forces operating in a market place

over which a business has no direct control ,but
which shape the manner in which the business
function and is able to satisfy its customers.
 The Marketing Environment

-Consists of the actors and forces

outside marketing that affect
marketing management’s ability to
develop and maintain successful
transactions with its target
customers.

23
 The Marketing Environment

considerations
Being successful means being able to
adapt the marketing mix to trends
and developments in this environment.

Changes in the marketing environment are

often quick and unpredictable

The Marketing environment offers both

opportunities and threats

The company use its marketing research

and marketing intelligence systems to
monitor the changing environment
24
.
 Contd.
• Systematic environmental scanning
helps marketers to revise and adapt
• marketing strategies to meet new
challenges and opportunities in the
marketplace

• The marketing environment is made up

of two types of environment.
25
 WHY IS IT IMPORTANT?

• An understanding of macro and micro marketing

environment forces is essential for planning.

• Helps a business to compete more effectively against

its rivals.

• Assists in the identification of opportunities and

threats.

• Enables an organization to take advantage of

emerging strategic opportunities.
 Marketing Environment
• The marketing environment
surrounds and impacts upon
the organization. There are
three key perspectives on
the marketing environment,
namely the 'macro-
environment,' the 'micro-
environment' and the
'internal environment‘.

27
 The micro-environment
influences the organization directly.
It includes suppliers that deal directly or
indirectly, consumers and customers,
and other local stakeholders.
Micro tends to suggest small, but this
can be misleading. In this context,
micro describes the relationship
between firms and the driving forces
that control this relationship.
It is a more local relationship, and the
firm may exercise a degree of
influence.
28
• The macro-environment
This includes all factors that can
influence and organization, but that are
out of their direct control. A company
does not generally influence any laws
(although it is accepted that they could
lobby or be part of a trade
organization). It is continuously
changing, and the company needs to
be flexible to adapt. There may be
aggressive competition and rivalry in a
market.

29
. Globalization means that there is
always the threat of substitute
products and new entrants. The
wider environment is also ever
changing, and the marketer needs
to compensate for changes in
culture, politics, economics and
technology.

30
 Marketing Environment

• Includes:
– Microenvironment - forces close to
the company that affect its ability to
serve its customers.
– Macroenvironment - larger societal
forces that affect the
microenvironment.

31
 The internal environment
• All factors that are internal to the
organization are known as the 'internal
environment'.
• They are generally audited by applying
the 'Five Ms' which are Men, Money,
Machinery, Materials and Markets.
• The internal environment is as
important for managing change as the
external. As marketers we call the
process of managing internal change
'internal marketing.'
32
 THE INTERNAL ENVIRONMENT

It includes the following:

• The human resource department.

• The operations department.
• The accounting and finance department.
• The research and development department.
 Again, What is a MARKET?

A market in business term is

more than just a place
where buyers and sellers meet.

A market is people with needs

and wants to be satisfied,
who can afford and are wiling to
spend.

Kotler (2003) defines market as a

set of all actual
and potential buyers of products
or services.
34
 Micro and Macro Environment

The marketing environment is made up of both

microenvironment and macroenvironment.

The microenvironment
-consists of six forces (actors) close to the company
that affect its ability to serve its customers.

the company itself (including

departments)
suppliers
marketing channel firms (intermediaries)
customer markets
competitors
the public 35
 Micro and Macro Environment
The marketing environment is made up of both
microenvironment and microenvironment.

The macro environment

Consists of a larger societal forces that affects the
microenvironment

• demography
• economy
• nature
• technology
• politics
• culture
36
 Forces in the Microenvironment

Intermediaries Customers
Suppliers
Competitors

Company
Company Public

37
The Company’s Microenvironment
 Forces in the Microenvironment
The Company

-thefirst actor is the company itself and the role its plays in the
microenvironment are the ff:

1. Top Management is responsible for setting the company’s

mission, objective, broad
strategies and policies.

2. Marketing Managers must take decisions within the

parameters established
by top management

3. Marketing Managers must also wok closely with other

company departments, since all
all areas produce better results when aligned by comment
objectives and goals.

4. All departments within the company must “think consumer”39

 Forces in the Microenvironment
The Company

Marketing

Top mgmt. Finance R&D Purchasing Manufacturing Accounting

40
 Forces in the Microenvironment
Suppliers

-are firms and individuals that provide the resources needed by the company and its
Competitors to produce good and services.

- They are an important link in the company’s overall customer “value delivery system”

- Marketing Managers should:

a. always watch supply availability (such as supply shortages)

b. monitor price trends of key inputs.

41
 Forces in the Microenvironment
Marketing Intermediaries/ Channel Firms

-are firms that help the company promote, sell and distribute
goods to final buyers

Intermediaries include:

• Resellers
• (one who buy and sell a product)
• Physical Distribution
• (warehouse to transportation firm, shipping
of goods)
• Marketing Service Agencies
• (agencies responsible for promotion)
• Financial Intermediaries
• (responsible in financing transactions)
•
42
 Forces in the Microenvironment
Customers

Company

consumer business reseller gov’t international

43
 Forces in the Microenvironment
Customers

-there are five types of customer markets a company

caters to

Customer markets include:

Consumer Market
(individual who buys for personal
consumption)
Business Market
(buys good and service for their production
use)
Government Market
(buys god and service to provide for public
use)
International Market
(buyers in other countries)

44
 Forces in the Microenvironment
Competitors

Every company faces a wide range of

competitors.

So a company should remember:

a. to secure a strategic advantage over

competitors to be successful in the
marketplace

b. there is no single competitive strategy

that is best for all companies 45
 Competitors Analysis: some Questions
• Who are the competitors of the firm?
• What are the current strategies' of the
competitors?
• What are their future goals and likely
strategies?
• What drives the competitors?
• Where the competitors vulnerable are?
• How are the competitors likely to respond
to the strategies of others?
46
 External Marketing
Environment
External Environment
Internal Social
(uncontrollable)
(within the Change Ever-Changing
organization) Demographics Marketplace
Marketing mix

Product Economic
Distribution Conditions
Promotion
Price
Competition
Target
Market Political &
Legal Factors
Technology
Environmental
Scanning

LO1 47
 Forces in the Microenvironment
Public

Company

Financial Media Gov’t Citizen Action Local General Internal

48
 Types of Publics

Citizen
nt Action
e L
ernm Publics Pu oca
v cs bli l
Go ubli cs
P

Ge ubl
Pu dia
cs

ne ic
P
Me
bli

ra
l
l
Financia

Inte ics
Publics

Pub
rnal
l
Company

49
 Forces in the Microenvironment
Public

- Is any group that has an actual or potential interest in or impact on an organization’s

ability to achieve its objectives.

Generally publics can be identified as being:

Financial Public
(influence ability to obtain funds)
Media Public
(carry news, features and editorial opinion)
Government Public
(must take government into account like truth in advertising/ issues of product
safety)
Citizen Action Public
(public relation department can help keep in touch with organizations and
minority groups)
Local Public
(includes neighborhood and community organizations)
General Public
(the public image of the company)
Internal Public
( keeping the employees feel good about their company)

50
 Forces in the Macroenvironment

natural technological
economic
political

demographic
Company cultural

51
The Macroenvironment

Demographic

Cultural Forces that Shape Economic

Opportunities
and Pose Threats
to a Company
Political Natural
Technological
 Economic
- factors that affect consumer purchasing
power and spending patterns.

53
 Economic Environment

Economic
Development

Key
Changes in Income:
Economic
Value Marketing
Concerns for
Marketers

Changing Consumer
Spending Patterns
54
Economic Environment

Economic Changes
Development Key in Income
Economic
Concerns for
Marketers

Changes
in Consumer
Spending
Patterns
 Forces in the Macroenvironment
Demographic Forces

Involves the people within the market in terms of

measurable factors
(human population in terms of size, location, age, gender
and other statistics)

It is important to focus on this factor, since demographic

trends are constantly
Changing. (Growing population means more needs to
satisfy)

56
 Demographic
• The demographic factors of the market in
which an organization operates, and which are
used to segment the target population for
effective marketing.
• studies populations in terms of size,
density, location, age, gender, race,
occupation and other statistics.
•

57
• Baby Boomers (born from 1946 to - - -
1964)Boomer Cohort #1 (born from 1946
to 1957)
- Boomer Cohort #2 (born from 1957 to
1964)
• .

58
• People born between the end of World
War 2 (1945) and the late 1960s, period
during which the populations and
economies of certain nations (particularly
the US) boomed. This term was coined in
1974 when the advertisers recognized the
spending power and very different
demands of these (then) youngsters

59
• Gen X/Baby Bust (II) (born from 1964 to
1976)
• Gen Y/Millennial/Echo Boomers (born from
1976 to 1994)
– Leading Edge (born from 1977 to 1990)
– Trailing Edge (born from 1990 to 1994)
• Generation Z/Generation I (born from 1995
to 2009?)

60
 Demographic Environment

• Baby boomers – 77 Million post-World War

II babies born between 1946-1964
• Generation X – 45 million born between
1965-1976, the “birth dearth”
• Generation Y (echo boomers) – 72 million
born between 1977-1994
• Generation Z (techno boomers) – born after
-1996
 Forces in the Macroenvironment
Natural Forces

it involves natural resources that are needed

-
as inputs by marketers or that are
affected by marketing activities

Some areas of concern may be:

a. Shortages of Raw Materials

b. Increased Pollution is a worldwide
problem
c. Government intervention in the
natural resource management

62
 Natural

- natural resources needed as

inputs by marketers or that are
affected by marketing
activities.

63
 Natural Environment

Shortages of
Raw Materials

Factors
Environmentally Affecting Increased
Sustainable the
Pollution
Strategies Natural
Environment

Governmental
Intervention 64
• 1). Shortages of raw materials. Staples
such as air, water, and wood products
have been seriously damaged and non-
renewable such as oil, coal, and various
minerals have been seriously depleted
during industrial expansion

65
• Increased pollution is a worldwide
problem. Industrial damage to the
environment is very serious. Far-sighted
companies are becoming "environmentally
friendly" and are producing
environmentally safe and recyclable or
biodegradable goods.  

66
• The public response to these companies is
encouraging.
lack of adequate funding, especially in third
world countries, is a major barrier

67
• Government intervention in natural resource
management has caused environmental
concerns to be more practical and necessary
in business and industry.  ,
• marketers should help develop solutions to
the material and energy problems facing the
world

68
• Environmentally sustainable strategies.
 The so-called green movement has
encouraged or even demanded that firms
produce strategies that are not only
environmentally friendly but are also
environmentally proactive. Firms are
beginning to recognize the link between a
healthy economy and a healthy
environment
69
 Forces in the Macroenvironment
Technological Forces

-forces
that create new technologies, as well as new product
and market opportunities

1. Technology is perhaps the most dramatic force shaping

our destiny

2. New Technologies create new markets and

opportunities, however
every new technology replaces an old technology

3. The challenge is only technical, but also commercial to

make practical, affordable
Versions of the product.
70
 Technological Environment

• Faster pace of technological change; products are

outdated at a rapid pace.
• Almost unlimited opportunities being developed
daily in health care, space industry, robotics, and
bio-genetic field.
• Challenge is not only technical, but also
commercial – make practical, affordable versions
of products.
• Increased regulation concerning product safety,
individual privacy, and other areas that affect
technological changes. 71
 Forces in the Macroenvironment
Political Environment

include laws, government agencies and pressure

-
groups that influence and limit
various organizations and individuals in a given
society.

Business is regulated by various form of legislation:

1. Government develop public policies to guide

commerce – sets of laws/regulation
limiting business for the good of society as a whole.

2. Almost every marketing activity is subject to a

wide range of laws and regulation

72
 Political Environment

Includes Laws, Government Agencies, Etc. that Influence

& Limit Organizations/ Individuals in a Given Society

Increased
Changing Emphasis on
Increasing Government Ethics &
Legislation Agency Socially
Enforcement Responsible
Actions

73
 Forces in the Macroenvironment
Political Environment

Some trends in political environment include:

1. Increasing legislation to:

a. Protect companies from each other
b. Protect consumers from unfair business
c. Protect interests of society against
unrestrained business behavior

2.Changing government agency enforcement –

new laws

3. Increased emphasis on ethics and socially

responsible actions

74
• Taxation.
• Protection of environment.
• Employment law.
• Health and Safety.
•   Foreign Trade Agreement (FTA).          
    
• Stability of political system.

75
• As a marketer you need to know, observe
and analyze all of the legal aspects in the
countries that you will market your products
in.
• Any company has its own legal rules and
policy
• The most important is to conduct a legal
policy that matches the industrial Laws
• .
76
 Cultural factors
• Culture is the most basic cause of a
person’s wants and behavior.
• Growing up, children learn basic values,
perception and wants from the family and
other important groups.

77
• Marketing is always trying to spot “cultural
shifts” which might point to new products
that might be wanted by customers or to
increased demand.
• For example, the cultural shift towards
greater concern about health and fitness has
created opportunities
• • Low calorie foods
• Health club memberships
• Exercise equipment
• Activity or health-related holidays etc.
78
• the increased desire for “leisure time” has
resulted in increased demand for
convenience products and services like as
microwave ovens, ready meals and direct
marketing service businesses such as
telephone banking and insurance.

79
• Each culture contains “sub-cultures” –
groups of people with share values.
• Sub-cultures can include nationalities,
religions, racial groups, or groups of people
sharing the same geographical location.
• Sometimes a sub-culture will create a
substantial and distinctive market segment
of its own.

80
• For example, the “youth culture” or “club
culture” has quite distinct values and
buying characteristics from the much older
“gray generation”

81
 Sociocultural factors
Education
• in a society affects the interests and
sophistication of consumers.
• For example, in a community in which a high
percentage of potential customers have
some form of post-secondary education, s
• The spoken language of the community is a
decisive factor on the labeling and
advertising of the products

82
Consider the foreign language skills in the
society while advertising.
in Washington, D.C. different transportation
companies use English and Spanish on
their brochures.

83
Social Organization
• social organization is the way a society
organizes itself
• kinship, status system, social institutions and
interest groups.
• For example, the role of women in a society,
whether they are the decision-makers in
shopping, for example, is a decisive factor in
marketing
84
• The marketing of a business can be
successful by building its advertising
strategy on women or moms, a specific
interest group or a leader that has the
most influence in the community.

85
• Family is a specific reference group and can play the
most important role in influencing the buying
decisions of the individuals.
• Spouses, children or grandparents have different
needs and necessities.
• Being aware of and finding the major reference
groups, persons or family structures in a community
and building marketing on them can help

86
• Role and Status in Society
A person's role in society and social status
affects her/his buying decisions.
Each person plays a dual role in society
depending on the group to which she
belongs.

87
An individual working as president at a reputed
firm is also someone’s wife and mother at
home.
The social status is also a relevant factor
an individual from an upper-middle class
would spend on luxurious goods,
an individual from a lower income group would
buy items required for basic needs. egy.

88
• Knowing the income information of the
potential customers gives the business
owner an edge, allowing her/him to have
more information about customer habits
and implement a successful marketing
strategy.

89
 Forces in the Macroenvironment
Cultural Environment

- Institutions and other forces that

affect society’s basic values,
perceptions, preferences and
behaviors

- Certain cultural characteristics can

affect marketing decisions making.
And the most dynamic cultural
characteristic is persistence on
cultural values – generation core
values.
90
• Cultural factors comprise of set of
values and ideologies of a particular
community or group of individuals

91
• Reference Group and Family
Rerence groups comprise people with whom
individuals compare themselves.
Family members, relatives, neighbors, friends,
co-workers and seniors at workplace can
form reference groups.
Well-known and respected idols in society
serve as examples in lifestyle, values and
buying habits.
92
 Cultural Environment: Elements of
Culture
1. Language
2. Manners & Customs
3. Technology & Material Culture
4. Social Institutions – business, family, political-
5. Education –transmitting values, skills, attitudes
etc
6. Aesthetics – attitude toward beauty, art, music etc
7. Religion

20 of 36
 World’s Religions
• Christianity - 2.0 billion followers
• Islam - 1.2 billion followers
• Hinduism - 860 million followers
• Buddhism - 360 million followers
• Confucianism - 150 million followers

Religion can affect marketing strategy

Religions

95
 Cultural Environment

People’s View of
Themselves
People’s View of People’s View of
the Universe Others
Cultural Values
of a
Society
People’s View of
People’s View of
Nature
Organizations
People’s View
of Society
96
Responding environment

97
98
 Three types of companies
• Makes things happen
• Watch things happen
• Wonders what’s happened

99
 Proactive approaches
• Hiring lobbyists
• Running “advertorials”
• Pressing lawsuits
• Filing complaints
• Forming agreements to control channels

100
• Through lobbying, legal action, advertising
of key issues, and public relations,
organizations can alter some
environmental forces.

101
• PESTEL Analysis

102
 Reactive
monitor the environment closely and
adjust its marketing strategy to counter
the effects of inflation, a new product
safety law, or product improvements by
competitors.

103
• The selection of a particular approach
is determined by an organizations
managerial philosophies,
• objectives, financial resources,
• markets and human skills, and by the
composition of the set of
environmental forces within which the
organization operates.
104
• a firm can control its competitive
environment by using aggressive pricing or
competitive advertising strategies to
influence the decisions of rival firms.
• It can lobby political officials to repeal
legislation that it believes will restrict its
business.
• Likewise, a firm can use political skills and
public relations activities to open foreign
marketer to domestic business.
105