PRINCIPLES OF

MARKETING
MARKETING ENVIRONMENT
MARKETING ENVIRONMENT
• A company’s performance is affected by several factors.

• The marketing environment consists of different components that

affect the company’s abilities to maintain its position in the market and
build successful relationship with its customers.

• Companies must learn to adapt and deal with the challenges

presented to them to stay profitable.
TYPES OF ENVIRONMENT
• Microenviroment
• Macroenvironment
MICROENVIROMENT
• Consists of the components close to the company that directly
affect its ability to maintain its position in the market and its
capacity to serve its customers.
• It consists of the company management, suppliers,
intermediaries, customers, competitors, and publics.
COMPANY MANAGEMENT
• Marketing is one department in an organization that has to work
with other departments such as the top management, finance,
operations, sales, and research and development in order to
implement projects, finalize plans, and create campaigns.
• The top management decides on company goals and objectives,
strategies, and policies.
• Has always say in the decision-making
SUPPLIERS
• Nowadays, companies treat their suppliers as partners because of
their role in the production process.
• Suppliers provide resources and materials needed by the company
to manufacture goods and develop services.
• Problems with suppliers can seriously affect the company such as
shortage in raw materials which will hamper production and
dissatisfy customers
• Competitors can also take advantage of the situations which gives
them the opportunity to take away the company’s customers.
INTERMEDIARIES
• These are entities that help get the products to the final
consumers.
• These include resellers, distributors, and retailers.
• They help move the products from the manufacturer to different
places.
• They also make the products available in big and small retailers for
consumer’s convenience.
INTERMEDIARIES
• Marketing services agencies include advertising firms, research
companies, media organizations, and marketing consultancy firms
that help promote the products to the final consumers.
CUSTOMERS
• These are integral part of the microenviroment

• Companies strive to build a good relationship with them to foster

loyalty and repeat purchase

• Providing value for them is the key to a lasting relationship

CUSTOMERS
There are different types of customers as follows:
Consumer market – individuals and households that buy products
for personal consumption
Business market – buys materials for use in production
Reseller market – buys products for reselling at a profit
Government market – government agencies that buy products to
provide public service
Global market – consumers from other countries
COMPETITORS
• Competitors offer products belonging in the same product
category or industry
• They try to offer the most superior value to consumers to earn
bigger market share and profits
• To be able to counter competitors, companies must determine
their competitive advantage and capitalize on it in their marketing
efforts.
PUBLIC
• It is any group of individuals that has an actual or potential interest in
the company or its products.
• They have the ability to create an impact on the company’s capacity to
achieve its goals.
• This type of customers includes the following:
Financial public – banks, lending institutions, and stockholders
make up the financial public that has the capacity to help provide
funding for the company’s expansion.
Government public – this includes government agencies that
formulate regulations and provide permits for the conduct of the
business
PUBLIC
Media public – TV, radio, print, or new media agencies comprise the
media public that provides news and information to the public
Citizen-action public – this includes organizations that champion
different causes – from promotion of environment protection to
fighting minorities right.
Local public – the people within the immediate community where the
company is located from the local public
General public – this includes anyone who knows about the company
and anyone who can see the campaigns and products of the company.
The company must be concerned of its image to the general public,
especially if issues arise that put the company in a bad light.
PUBLIC
Internal public – this consists of the company’s employees,
management, and stakeholder who contribute in achieving the goals
of the organization
MACROENVIROMENT
• Consists of the bigger factors that are beyond the control of the
management.
• It consists of the demographic, economic, natural,
technological, political, and cultural enviroment
DEMOGRAPHIC ENVIRONMENT
• Contains quantitative information on the human population such as
age, gender, income, religion, educational attainment, and other
statistical data.
• These pieces of information are important as they help determine
the characteristics of the company’s consumers, which help
formulate the right products for its target market.
• The three biggest generation groups are the Baby Boomers,
Generation X, and the Generation Y or the millennials. The
upcoming generation is called the generation Z.
BABY BOOMERS
born post-World War II (between 1946 and 1964)
They make up the mature market
They seek for finer things and are ready to travel the world and
enjoy life
When they travel, they prefer comfort and convenience, but still go
after unique experiences
They are the market for more upscale travel package
GENERATION X
Born between 1965 and 1976 and has growing purchasing power
Some are still raising their families, sending their kids to school, and
faced with challenges maintaining their lifestyle and financial health
Gen X-ers are strong generation who are open to diversity and
more experience
MILLENNIALS OR GENERATION Y
Millennials were born between 1977 and 2000
They are very comfortable with technology and form a large part
of digital consumers
They are always connected to the internet, are at ease with
technology, and own multiple gadgets
They are used to multitasking, or doing things at the same time
They can talk to their phone while chatting with someone on the
computer while the TV is turned in to their favorite show
GENERATION Z
Born after the year 2000
They are also tech savvy as they are growing up with technology
They play on the tablets before they can even learn how to write
They are predicted to be highly connected, lead a technology-
driven life and be avid consumers of social media
ECONOMIC
• Consists of factors that affect the purchasing power and spending
patterns of consumers
• An increase in fuel price also increases the price of basic
commodities such as rice, sugar, and coffee.
• This may affect the choices of consumers but since they are basic
needs, consumers will still buy them, but they may opt for cheaper
alternatives
NATURAL
• Consists of changes in the physical environment and natural resources
• Example: companies that use coconut as raw materials were affected
by the widespread infestation of cocolisap causing the leaves to dry up
and wither away
• Likewise, businesses in flood-prone areas lose sales during the rainy
season
• While companies cannot prevent these events from happening, they
must be flexible enough to be able to adapt to changes and come up
with contingency plans to address them
TECHNOLOGICAL
• Companies nowadays enjoy the many opportunities by technology

• The availability of technology can help marketers gather data and

information, conduct business online, enjoy advancement in
production, and many others.
• Ex. Grocery inventory
POLITICAL
• It includes laws and legislation regulating business, government
rulings, and other factors that may affect the way business are
conducted
• New policies or regulations may affect the sales of certain products
• Ex.: Healthy Beverage Options Act of 2014
CULTURAL
• People grow to a particular set of value system based on their
culture, beliefs, and religion.
• These shape each person’s view of the world, people surroundings,
and certain issues
• Core beliefs and values are the ones passed on from parents and
family to children and are reinforced by school, religion, and
government
• Secondary beliefs are more open to change and most likely
influenced by the other people on your social circle