3 understanding the marketing environment

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understanding the marketing environment

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3 understanding the marketing environment

  1. 1. Understanding the Marketing Environment Session 2
  2. 2. Why environment scan? • “If the rate of change inside a company is less than the rate of change outside a company, then the end is in sight” Jack Welch, ex CEO, GE
  3. 3. Elements of the environment scan • Environment monitoring or scanning is defined as the process of gathering information regarding a firms external environment, analyzing it and forecasting its impact on the company’s business. • External environment…..uncontrollable element • Internal environment……controllable element
  4. 4. External environment • Macro elements…those which affect all firms in the industry • Demographics • Economic conditions – Global – Domestic • Cultural issues • Political • Micro elements…those which relate to a specific firm • Suppliers • Customers • Intermediaries • Competition
  5. 5. External elements impacting company’s marketing program Co’s marketing program Demographics Economic conditions Competition Technology Social & cultural Political & Legal
  6. 6. Demographics Years Age group 2001 2006 2011 2016 0 – 14 366(35.6) 262(32.5) 355(29.7) 343(27.1) 15 – 59 598(58.2) 673(60.4) 747(62.5) 811(64) 60+ 65(6.3) 78(7) 94(7.9) 113(8.9) Age distribution & projection of Indian population, in millions. Statistical outline of India, 2003-04, Jan 2004, Tata Services Ltd.
  7. 7. Characteristics of population • Size • Distribution…age, sex, rural-urban • Growth…absolute, sectors • Profile & character…nuclear family, working women, youth, literacy, BPL
  8. 8. EDUCATION LEVEL OCCUPATION Illiterate School upto 4 yrs/lit but no formal education Schooling 5-9 yrs SSC/HSC Some college but not graduate Graduate/ post graduate, general Graduate/ postgradu ate professio nal Unskilled worker E2 E2 E1 D D D D Skilled worker E2 E1 D C C B2 B2 Petty trader E2 D D C C B2 B2 Shop owner D D C B2 B1 A2 A2 Businessman/industrialist with nos. of employees….none D C B2 B1 A2 A2 A1 Businessman/industrialist with nos. of employees….1-9 C B2 B2 B1 A2 A1 A1 Businessman/industrialist with nos. of employees….10+ B1 B1 A2 A2 A1 A1 A1 Self employed professional D D D B2 B1 A2 A1 Clerical/salesman D D D C B2 B1 B1 Supervisory level D D C C B2 B1 A2 Officer/Executive….. junior C C C B2 B1 A2 A2 Officer/Executive….. senior B1 B1 B1 B1 A2 A1 A1 Socio-Economic classification Based on education & occupation of the chief wage earner
  9. 9. Impact of the environment • Affects buying behavior • Demographic shifts – Children, teens, youth, women – Disposable surpluses – Emergence of the rural markets • Social & cultural changes – Lifestyle changes – Values and beliefs – Time poor society – Working women • Technological impact – Concern for the natural environment – Tech savvy generation – E-marketing
  10. 10. Impact of the external environment • Variables are – The firm’s market • The changes taking place • Emergence of new markets • Maturing of the markets – The suppliers • Competitiveness • Quality consciousness • New generation – The intermediaries • Source of revenue • Avenue of market reach & presence
  11. 11. The challenge • External elements……uncontrollable • Internal elements……..controllable – Supporting functions like production, finance, HR, R&D, Image – Marketing variables…the 4 P’s & the 7P’s • Concept of Marketing Mix

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