Functions of Marketing Environment
The functions of the marketing environment can be well-understood from the points given below: –
Essential for planning
Proper understanding of the market environment is a must for framing of right plan and strategies for the future. It is a must for marketers to get the exact idea of the present scenario, dynamism as well as future estimations of the marketing environment in order to ensure that his/her plan get succeeds. The marketing environment consists of detailed information about both internal and external environment which assists in doing the right analysis in present for coming up with efficient futuristic plans.
Helps in understanding customers
Having an exact idea of what customers actually want to enable marketer in fulfilling their need and earning maximum satisfaction. The marketing environment consists of thorough knowledge of customer needs and wants thereby enabling the marketer to predict the customer wants. Proper in-depth analysis of the marketing environment helps a lot in bringing down the noise existing between customer and marketer. Moreover, it helps in knowing the customer behavior in a better way leading to long-term relationships between marketer and customer.
Knowing threats and opportunities
There are lots of threats and opportunities existing at every point of time in the market. Businesses that are able to identify them timely are able to continue in long term with higher growth. A marketer having sound knowledge of the marketing environment is able to avail first-mover advantage in the market by making sure that his business is safe from coming threats in the future and also taps the future opportunities.
Tapping of trends
Every business in order to survive need to be updated in accordance with going trends in the market. Customer is a king and businesses need to serve them as per their requirements. A lot of insight about the marketing environment needs to be done for entering new markets and capitalizing on newer trends. All aspects of the environment need to be well researched by marketers for coming up with a foolproof plan.
Knowing about competitors
Businesses should always try to be updated about their competitors’ actions in order to excel in the market. Every niche has multiple players, all of them fighting for the same spot. The proper study of the marketing environment enables the marketer to great extent in knowing about the competitors. He becomes well-aware of what advantages do the competitors possess over his business and vice-versa.
Managing the changes
The marketing environment provides great support to businesses in coping with fast changes going on in the market. For the business to be successful and earn goodwill, adjusting itself to the changes going on in the marketing environment is the much-needed thing.
Examples of Marketing Environment
Internal marketing environment example
The most suited example for an internal marketing environment is the office culture of a business enterprise. The employee’s attitude, values, and beliefs form part of organizational office culture. These all factors influence in one or another way that what will be the behavior of company employees. Like suppose, if employees in a company are encouraged to work in a team and help their other team members, then their performance level will be obviously high as compared to the organization in which employees just compete with one another. Moreover, if the company maintains a positive internal environment, then employees’ performance is better as compared to one where employees are continuously pressurized to increase their output.
External marketing environment example
Micro and macro environment are two components that are covered under the external marketing environment. The microenvironment is composed of customers, suppliers, market intermediaries, competitors, partners, the public, etc. Now, for instance, let check the role played by suppliers in influencing the business environment of the company to a larger extent. A business can produce the right quality products and at the right time only if the supplier supplies materials of good quality in a timely manner. If the supplier in the case does not supply at the right time, it will eventually obstruct the production activities of the business enterprise.
Market intermediaries are another major component covered under the microenvironment and decide the success of the overall business. They are like the face of any company that does interact with clients, get to know about their needs as well as business products. For example, products of multiple companies are sold by a retailer so it is completely in the hands of retailers which products to promote more and which do not. The sales of the company therefore to large extent are dependent on their representatives in the market. Fixing good incentives for your representatives is a must in order to motivate them to promote your products on large scale among customers in the market.
The macro environment, however, does not affect any specific business but the whole industry gets affected by it. Factors of macro environment need to be considered by the business for carrying out its operations. It includes the economic environment, demographic environment, socio-cultural environment, technological environment, political and physical environment.
The laws and policies of the country which are decided by the government regulate the business operations. Also, the technological environment has a major role to play in the business environment than any other microenvironment factor. Timely updating of technology is necessarily required by businesses to remain in the market. The technological environment carries both merits and demerits for business as consideration of innovation needs to be kept at priority in order to compete with competitors successfully. Whereas, it is also quite costly for businesses to update their technology on regular basis.