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Service Marketing Environment
All organizations operate within the marketing
environment. The marketing environment is
made up of two parts –
• Macro environment
• Micro environment
Macro Environment
The macro environment represents all the
outside influences which have impact on an
organization’s marketing or business activity. It
includes economic and political factors and
socio-cultural trends, for example the external
environment influences will effect all
organizations within a sector to a greater or
lesser degree. The internal environment relates
to a particular organization and its publics.
Micro Environment
The micro environment is the internal
environment of the organization .The factors to
be analyzed in the internal environment will
include the following :
• Company management structure
• Customers
• Suppliers
• Channel members
• Competitors
• Other publics which may include
• Government and political bodies
• Pressure groups
• Financial institutions
• Shareholders
In effect any person or organization which can
influence the company’s marketing activities
and marketing success in way should be
included here. The list is not absolutely
comprehensive as individual organizations may
need to consider special influences.
The political legal , economic , social and
technological forces exert the same type of
services as they do on products ; however
certain environment features have a greater
impact on service These environmental factors
are :-• Political –legal environment
• Economic environment
• Socio-cultural environment
• Technological environment
Political –Legal Environment
There is considerable influence of the political –
legal environment on service marketing . Service
industries are often more closely regulated than
most other forms of private enterprise. Many
service firms are being subject to government
regulations in addition to the usual taxes and
legislation. Service providers must understand
and recognize the impact of such regulation on
their competitive strategies.
Regulation generally influences service business in
four ways.
• Regulation generally influences the range and
type of competition.
• Regulation reduces the marketer’s array of
options and introduces certain rigidities into the
marketing process.
• Decision of the regulatory agencies being the
binding part of the marketing decision –making
process must be focused at understanding and
predicting those agencies action
• Pressure groups may be established to lobby and
effect change or modify , the directions being
taken by the regulatory bodies.
Economic Environment
In economic environment changing life style ,
changing world ,changing economies and
changing technological advances and changing
consumer needs have contributed to increase
spending on consumer services. Technological
innovations have also helped to create a higher
standard of living for a common man, who
presently spends a larger portion of his or her
increased disposable income of services.But the
role of technology has also aided in
circumventing barriers to trade , especially in its
role in designing and delivering services. The
urbanization has widened the demand for
personal and public services . The demographic
shift towards an older population in some
countries has resulted in new service demands
such as better healthcare , convenience
products etc. In the global environment , due to
cross country cultural issues , trade barrier (
both tariff and non-tariff) tend to become more
restrictive in marketing of services.
Socio-Cultural Environment
Socio- cultural forces are set factors including
life style , social values and beliefs that affect the
marketing activities of an organization. These
factors have significant impact on the marketing
of services . The marketers have found the
intensive use of consultants and counselors in
their personal family and working lives. Health,
Beauty, travel, culture, and higher education
have partly replaced durable goods as status
symbols in the mind of many consumers . There
had been an increasing trend in the services like
security , insurance, legal, medical and investment.
Globally , the cultural dimensions affect services in
a more pronounced manner than do goods. Due to
inseparability characteristic of services the firms
may need to adapt their offerings to suit local taste
and preferences . KFC and Mc’Donald’s had to
adapt its products in India to suit local polates.
Business negotiations are very much subject to local
norms and local systems. Language is a major
cultural influence
Technological Environment
Technology has influenced our life styles,
consumption pattern and our economic well
being tremendously. Just think of internet ,
worldwide web (www) , E-commerce , video
conferencing. World has become too small and
boundary less. The service economies will be
technologically driven soon. Instead of expecting
service providers to improve results ;
management must see what kind of
organizational structure , incentives , technology
and skills can improve overall productivity.

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Service marketing environment

  • 1. Service Marketing Environment All organizations operate within the marketing environment. The marketing environment is made up of two parts – • Macro environment • Micro environment
  • 2. Macro Environment The macro environment represents all the outside influences which have impact on an organization’s marketing or business activity. It includes economic and political factors and socio-cultural trends, for example the external environment influences will effect all organizations within a sector to a greater or lesser degree. The internal environment relates to a particular organization and its publics.
  • 3. Micro Environment The micro environment is the internal environment of the organization .The factors to be analyzed in the internal environment will include the following : • Company management structure • Customers • Suppliers • Channel members
  • 4. • Competitors • Other publics which may include • Government and political bodies • Pressure groups • Financial institutions • Shareholders In effect any person or organization which can influence the company’s marketing activities and marketing success in way should be included here. The list is not absolutely comprehensive as individual organizations may need to consider special influences.
  • 5. The political legal , economic , social and technological forces exert the same type of services as they do on products ; however certain environment features have a greater impact on service These environmental factors are :-• Political –legal environment • Economic environment • Socio-cultural environment • Technological environment
  • 6. Political –Legal Environment There is considerable influence of the political – legal environment on service marketing . Service industries are often more closely regulated than most other forms of private enterprise. Many service firms are being subject to government regulations in addition to the usual taxes and legislation. Service providers must understand and recognize the impact of such regulation on their competitive strategies.
  • 7. Regulation generally influences service business in four ways. • Regulation generally influences the range and type of competition. • Regulation reduces the marketer’s array of options and introduces certain rigidities into the marketing process. • Decision of the regulatory agencies being the binding part of the marketing decision –making process must be focused at understanding and predicting those agencies action • Pressure groups may be established to lobby and effect change or modify , the directions being taken by the regulatory bodies.
  • 8. Economic Environment In economic environment changing life style , changing world ,changing economies and changing technological advances and changing consumer needs have contributed to increase spending on consumer services. Technological innovations have also helped to create a higher standard of living for a common man, who presently spends a larger portion of his or her increased disposable income of services.But the
  • 9. role of technology has also aided in circumventing barriers to trade , especially in its role in designing and delivering services. The urbanization has widened the demand for personal and public services . The demographic shift towards an older population in some countries has resulted in new service demands such as better healthcare , convenience products etc. In the global environment , due to cross country cultural issues , trade barrier ( both tariff and non-tariff) tend to become more restrictive in marketing of services.
  • 10. Socio-Cultural Environment Socio- cultural forces are set factors including life style , social values and beliefs that affect the marketing activities of an organization. These factors have significant impact on the marketing of services . The marketers have found the intensive use of consultants and counselors in their personal family and working lives. Health, Beauty, travel, culture, and higher education have partly replaced durable goods as status
  • 11. symbols in the mind of many consumers . There had been an increasing trend in the services like security , insurance, legal, medical and investment. Globally , the cultural dimensions affect services in a more pronounced manner than do goods. Due to inseparability characteristic of services the firms may need to adapt their offerings to suit local taste and preferences . KFC and Mc’Donald’s had to adapt its products in India to suit local polates. Business negotiations are very much subject to local norms and local systems. Language is a major cultural influence
  • 12. Technological Environment Technology has influenced our life styles, consumption pattern and our economic well being tremendously. Just think of internet , worldwide web (www) , E-commerce , video conferencing. World has become too small and boundary less. The service economies will be technologically driven soon. Instead of expecting service providers to improve results ; management must see what kind of organizational structure , incentives , technology and skills can improve overall productivity.