Description
The market environment is a marketing term and refers to factors and forces that affect a firm’s ability to build and maintain successful relationships with customers.Three levels of the environmment are: Micro (internal) environment - small forces within the company that affect its ability to serve its customers.
The marketing Environment
Definition: The actors and the forces outside marketing (controllable and uncontrollable) that affect marketing management’s ability to develop and maintain successful transactions with its target customers
The Macro Environment
The larger societal forces are : • Economic Environment • Technological Environment • Political Environment • Socio-Cultural Environment
Economic Environment
• The economic environment consist of factors that affect the consumer purchasing power and spending patterns
• Subsistence Economies – they consume most of own agricultural and industrial output • Industrial Economies – constitute rich markets for many different kind of goods
Technological Environment
• The technological environment changes rapidly. • Scientists are researching a wide range of promising products and services ranging from practical solar energy, electric cars and cancer cures to voice controlled computers and genetically engineered food crops.
Political Environment
• The political environment consist of laws, government agencies and pressure groups that influence and limit various organizations and individuals in a given society.
Socio-Cultural Environment
• The cultural environment is made up of institutions and other forces that affect a society’s basic values, perceptions, preferences and behavior. • People grow up in a particular society that shapes their basic beliefs and values.
Microenvironment
The actors close to the company that affects its ability to serve its customers - the company, suppliers, marketing intermediaries, customer markets, competitors and public
Marketing Intermediaries
Customers
Suppliers
Competitors
The Company
Public Marketing
The micro environment
a) Company b) Competitors
Company
In designing marketing plans marketing management takes other company groups into account such as top management, finance, research and development (R & D), Purchasing, operations and accounting. All these are inter-related groups from the internal environment.
Top management sets the company’s mission, objectives, broad strategies and policies. Marketing managers make decisions within the strategies and the plans made by the top management.
Under the marketing concept, all these functions must “think Consumer”. They should work in harmony to provide Customer value and satisfaction
Competition
The marketing concept states that to be successful, a company must provide greater customer value and satisfaction than its competitors do. E.g. • Ford developed the model called IKON to compete with Maruti an existing model of Japanese Suzuki
• Nirma decided to offer its detergent at the 1/3rd price of Surf.
Concept of Market Potential
• Market potential the total amount of a product that customers will purchase within a specified period of time at a specific level of industry wide marketing activity • A forecast of the size of a market
Benefits of Market potential analysis
• Understand market potential for a single store, network of stores or a new market • Deploy resources effectively by ranking markets in priority order • Forecast total opportunity in terms of number of customers and revenue potential • Estimate your market share
Market Share
Market share is the percentage of the total market that a company controls for a particular product or product category. If the widget market is $100 million annually and Acme Inc. sells $25 million in widgets, its market share is 25%. Market share is also sometimes given in unit sales: If Acme sells 10,000 widgets in a 50,000 widget market, its unit market share is 20%.
Market Share
• The Firms performance relative to competitors can be measured by the proportion of the market that the firm is able to capture This proportion is referred as firm’s market share • Market share is often broken down by geographic area (state, country, etc.), gender and other demographics. Companies strive to increase market share to achieve economies of scale in production, distribution, advertising, and other functional areas, thereby widening profit margins and increasing earnings. Moreover, the firm with a dominant market share can often dictate market practices that keep competitors at bay. To increase market share, companies lower prices, improve products, increase advertising spending, and expand distribution channels. The most dramatic way of increasing market share, however, is to merge with a competitor.
doc_302903915.pptx
The market environment is a marketing term and refers to factors and forces that affect a firm’s ability to build and maintain successful relationships with customers.Three levels of the environmment are: Micro (internal) environment - small forces within the company that affect its ability to serve its customers.
The marketing Environment
Definition: The actors and the forces outside marketing (controllable and uncontrollable) that affect marketing management’s ability to develop and maintain successful transactions with its target customers
The Macro Environment
The larger societal forces are : • Economic Environment • Technological Environment • Political Environment • Socio-Cultural Environment
Economic Environment
• The economic environment consist of factors that affect the consumer purchasing power and spending patterns
• Subsistence Economies – they consume most of own agricultural and industrial output • Industrial Economies – constitute rich markets for many different kind of goods
Technological Environment
• The technological environment changes rapidly. • Scientists are researching a wide range of promising products and services ranging from practical solar energy, electric cars and cancer cures to voice controlled computers and genetically engineered food crops.
Political Environment
• The political environment consist of laws, government agencies and pressure groups that influence and limit various organizations and individuals in a given society.
Socio-Cultural Environment
• The cultural environment is made up of institutions and other forces that affect a society’s basic values, perceptions, preferences and behavior. • People grow up in a particular society that shapes their basic beliefs and values.
Microenvironment
The actors close to the company that affects its ability to serve its customers - the company, suppliers, marketing intermediaries, customer markets, competitors and public
Marketing Intermediaries
Customers
Suppliers
Competitors
The Company
Public Marketing
The micro environment
a) Company b) Competitors
Company
In designing marketing plans marketing management takes other company groups into account such as top management, finance, research and development (R & D), Purchasing, operations and accounting. All these are inter-related groups from the internal environment.
Top management sets the company’s mission, objectives, broad strategies and policies. Marketing managers make decisions within the strategies and the plans made by the top management.
Under the marketing concept, all these functions must “think Consumer”. They should work in harmony to provide Customer value and satisfaction
Competition
The marketing concept states that to be successful, a company must provide greater customer value and satisfaction than its competitors do. E.g. • Ford developed the model called IKON to compete with Maruti an existing model of Japanese Suzuki
• Nirma decided to offer its detergent at the 1/3rd price of Surf.
Concept of Market Potential
• Market potential the total amount of a product that customers will purchase within a specified period of time at a specific level of industry wide marketing activity • A forecast of the size of a market
Benefits of Market potential analysis
• Understand market potential for a single store, network of stores or a new market • Deploy resources effectively by ranking markets in priority order • Forecast total opportunity in terms of number of customers and revenue potential • Estimate your market share
Market Share
Market share is the percentage of the total market that a company controls for a particular product or product category. If the widget market is $100 million annually and Acme Inc. sells $25 million in widgets, its market share is 25%. Market share is also sometimes given in unit sales: If Acme sells 10,000 widgets in a 50,000 widget market, its unit market share is 20%.
Market Share
• The Firms performance relative to competitors can be measured by the proportion of the market that the firm is able to capture This proportion is referred as firm’s market share • Market share is often broken down by geographic area (state, country, etc.), gender and other demographics. Companies strive to increase market share to achieve economies of scale in production, distribution, advertising, and other functional areas, thereby widening profit margins and increasing earnings. Moreover, the firm with a dominant market share can often dictate market practices that keep competitors at bay. To increase market share, companies lower prices, improve products, increase advertising spending, and expand distribution channels. The most dramatic way of increasing market share, however, is to merge with a competitor.
doc_302903915.pptx