Transcript Markets - PGGCG-11, Content Management Portal

Nature and
importance of
An actual or nominal
place where forces
of demand and supply
operate, and where
buyers and sellers
interact
(directly or through
intermediaries)
to trade goods,
services, or contracts
or instruments, for
money or barter.
Markets include mechanisms or means for
 (1) determining price of the traded item,
 (2) communicating the price information,
 (3) facilitating deals and transactions, and
 (4) effecting distribution.
The market for a particular item is made up of
existing and potential customers who need it
and have the ability and willingness to pay for
it.
Definitions :
According to American Marketing
Association ,”At every point at
which a specific commodity is
concentrated for sale a market is
found .”
According to Carnot, "economists
understand by the term market
not any particular place in which
things are brought and sold but
the whole of any region where
buyers and sellers are in such
free intercourse with one
another that the price of the
same goods tends to equality,
easily and quickly.”
market
Commodity markets
Produce market
Manufactured goods
market
Bullion market
Capital markets
Money market
Share market
Foreign market
Commodity markets :-
commodity markets relate to the purchase and sale of
goods. Goods may be divided
into two categories :-
Consumer goods :
Consumer goods are those goods
which are required for
consumption by consumers.
Producer goods :
Producer goods are those goods
which are required by
manufacturers for producing more
goods.
1. Produce markets
It deals in agricultural products
such as wheat,
rice, cotton , maize etc.
The products dealt in these
markets are either required
for producing further goods or
for consumption.
Examples : cotton exchanges
of Bombay and Liverpool.
Jute exchange of Calcutta.
2. Manufactured goods
market
These are the markets where
Manufactured and semi –
manufactured goods are
purchased and sold.
The commodities like sugar,
clothes,leather,yarn etc, are
traded in these markets.
Example : sugar exchange of
Liverpool
Leather exchange of Kanpur
3.Bullion markets
These markets deal in the
trade of precious metals like
gold, silver etc.
These markets are sensitive
and influenced by important
happenings in the world.
Example :- bullion markets of
Bombay, Calcutta,
Kanpur and Delhi.
The capital market is a market for
financial assets which have a long or
indefinite maturity. The capital
market instruments become mature
for the period above one year. It is an
institutional arrangement to borrow
and lend money for a longer period
of time. It consists of financial
institutions like IDBI, ICICI, UTI, LIC,
etc. These institutions play the role
of lenders in the capital market.
Capital market provides long term
debt and equity finance for the
government and the corporate
sector.
1. Money market
Money market are those
institutions which provide
short term funds to the
business.
Lenders, borrowers and
middlemen are the important
constituents of money
markets. The middlemen bring
together the lenders and
borrowers.
The price for lending money is
interest which borrowers pay
to lenders.
These are the organised markets
for purchase and sale of stocks,
shares and debentures .
Joint stock companies get their
shares and debentures
registered in these exchanges
and investors trade in these
securities .
Stock exchanges are important
centers of channelising
investments.
Example : the exchanges of
Bombay, Calcutta, madras ,
Delhi and Ludhiana.
These markets trade in foreign
currencies. They deal in purchase and
sale of foreign exchange.
The international trade is greatly helped
by foreign exchange markets. These
markets help in settlement of foreign
debts.
Example : New York and London are
important foreign exchange markets in
the world .
In India foreign exchange markets are at
Calcutta, Bombay, Madras and Delhi.
Marketing is "the activity, set of institutions, and processes for
creating, communicating, delivering, and exchanging offerings
that have value for customers, clients, partners, and society at
large.“
it is "the process by which companies create value for customers
and build strong customer relationships, in order to capture
value from customers in return". Marketing is used to identify
the customer, satisfy the customer, and keep the customer
it is an integrated process through which companies build
strong customer relationships and create value for their
customers and for themselves.
Marketing is the management process through which goods and
services move from concept to the customer. As a practice,
it consists in coordination of four elements called 4P's:
(1) identification, selection, and development of a product,
(2) determination of its price,
(3) selection of a distribution channel to reach the
customer's place, and
(4) development and implementation of a promotional
strategy.
What can be marketed ?
PHYSICAL
PRODUCTS
DVD PLAYERS, MOTOR CYCLES, IPODS,
CELL PHONES, FOOTWEAR, TELEVISION
SERVICES
IN SURANCE, HEALTH CARE, BUSINESS,
SECURITY
IDEAS
POLIO VACCINATIONS, FAMILY PLANNING,
DONATION OF BLOOD
PERSONS
FOR ELECTION OF CANDIDATES FOR
CERTAIN POSTS
PLACE
UDAIPUR - THE CITY OF LAKES, MYSORE –
THE CITY OF GARDENS
EXPERIENCE
CUSTOMISED EXPERIENCES AS DINNER
WITH A FAMOUS CRICKETER ( SAY M.S.
DHONI )
PROPERTIES
INTANGIBLE RIGHTS OF OWNERSHIP OF
REAL ESTATE IN FINANCIAL PROPERTY (
SHARES AND DEBENTURES )
EVENTS
SPORTS EVENTS ( SAY OLYMPICS , CRICKET
SERIES ), DIWALI MELA
INFORMATION
DISTRIBUTION OF INFORMATION BY
ORGANISATIONS SUCH AS BY
UNIVERSITIES, RESEARCH
ORGANIZATIONS.
ORGANIZATIONS
FOR BOOSTING THEIR PUBLIC IMAGE
ORGANISATIONS SUCH AS HINDUSTAN
LEVER, RANBAXY, DABUR COMMUNICATE
WITH THE PEOPLE
OLD APPROACH TO MARKETING ( SALES CONCEPT
PRODUCT
SELLING AND
PROMOTING
PROFIT
MAXIMISATIO
N THROUGH
SALES
VOLUME
=>recoganised that marketing process
begins long before the goods go into
production and it does not end with the
final sale .
=>needs of the customers are identified ,
studied and analysed .
=>involves all efforts to create customers
for the products and provide maximum
satisfaction to them.
NEW OR MODERN APPROACH TO MARKETING
FOCUS
CUSTOMER
NEEDS
MEANS
ENDS
INTEGRATED
MARKETING
MAXIMISATIO
N OF PROFITS
THROUGH
SATISFACTIO
N
MARKETING
CONCEPT
The modern approach to marketing is
referred to as
the marketing concept. Main essence of
marketing concept is that the
customer and not the product is the
centre of entire business. This concept
explains the rationale for a firm’s
existence in terms of its ability to
satisfy some aspects of consumer
needs and recognise main purpose of
business as to ‘ create a customer’
Main aim is customer
statisfaction not the product
selling
DEFINITIONS
BY KOLTER “The
marketing concept is a customer orientation
backed by integrated marketing aimed at generating
customer satisfaction as the key to satisfy
organisational goals “
BY LAZO AND CORBIN “ Marketing
concept is the recognition on the part of
management that all business decisions of a firm must
be made in the light of customer needs and wants “
DISCUSSION OF ABOVE DEFINITIONS
BRINGS OUT FOLLOWING FACTS :
 Customer satisfaction guides the whole system ;
 To work together to do a better job ;
 Maximisation of profits through customer
satisfaction;
 A firm has determine actual needs , wants and
preferences of customers .
IMPLEMENTING MARKETING
CONCEPT
Profit focus
Consumer
focus
Research base
of decision
Innovation
Broadened
functional
base
Integration
of marketing
functions
Consumer focus
main focus of the enterprise should be on customer
while implementing marketing concept . A variety
of factors affect customer satisfaction like product
quality , product availability and after – sales
support such as warranties and services .
Organisation must determine what customers
need and want and then develop product that
satisfy those needs. main focus on consumer needs
and their satisfaction
Besides consumer the firm should also focus on
profitability for its existence , growth and stability .
Profit is also essential to ensure continuity of
managerial efforts to solve select consumer
problems success of firm is associated with amount
of profits it gets for business . Profits are reward of
managerial efforts directed towards creating and
delivering consumer satisfaction profiteering
Innovation –
It helps in devising suitable and better
products for the consumers . efforts are
made to change existing product for
making it more useful , changing the
product itself for creating a better one .
innovations may also help in finding new
use for old product , improvement in
design or even in marketing technique .
so innovation is essential for
implementing marketing concept in an
organisation
Research base of
decisions
 Marketing decisions should be based on
marketing research and not on intuition .
Marketing concept requires that needs of
Consumer should be assessed before planning a
product . Marketing research will identify
consumer needs and marketing opportunities
with profit potential . The marketing feedback
will help in assessing consumer reactions and
social reactions to firm ‘s marketing programme
. Research will help in taking proper and timely
decision for implementing marketing concept.
The traditional marketing concentrated on
production and delivering of goods to the
consumer or users . The function of selling ,
pricing , advertising and physical distribution
were performed by the firms . The marketing
concept focus on consumer needs and their
statisfaction . The function such as
marketing research , product planning etc
are also added to traditional functions
Integration of marketing
functions
 Beside broadening the functional base of
marketing , there is a need to integrate these
functions . The integration involves organisation
of all marketing function in a such a manner that
it result in their total integration and coordination from the conception of a new product
to its consumption by the ultimate user .
According to CASCINO , all marketing functions
should be put under a separate marketing
department , different marketing executives
should be responsible for different functions.
Benefits of marketing
concept
1. There is total change in the philosophy in business ,
2.
3.
4.
5.
customer needs, want and desires receive top
consideration in all business activity ;
More emphasis is given on research and innovation;
Greater attention is given to the product planning
and development ;
Many changes in the product designs are
introduced ;
Marketing research becomes an integral part of
marketing process and a managerial tool in decision
making ;
PRODUCTION CONCEPT
 This concept laid emphasis on
production and assumes that consumers
will always respond to products that are
made available to them.
this concept developed when there is a
period of manufacturing dominance and
there was no competition. It was
producers market and hence production
problems were of more importance than
anything else . The major task of the
management was to strive constantly to
increase production and there was no
selling or marketing problems
This concept may boost the sales in the
initial stages but it invites the criticism
that it is impersonal in its approach and
ignores the interests of the consumers .
Product concept
With passage of time , it realised that it is not only
the quantity of production but also the quality of
the product that is important. The product
concept assumes that the consumer will respond
favorably to the best quality products that’s are
reasonably priced and hence major task of the
management is to improve the quality of the
product it offers to successfully attract and hold
customers.
 The selling concept assumes that consumer will
generally not buy enough of the firm’s products
unless there interest is stimulated in its products
through substantial selling and promotional
activities . In this concept focus is on the product
, the means are selling and promotional and the
objective is maximisation of profits through sales
volumes .
MAIN DRAWBACKS OF THIS CONCEPT IS IT
INGROES CONSTOMER’S INTEREST AND A
FIRM WHICH FOLLOWS THIS CONCEPT MAY
FACE DIFFICULTIES IN THE LONG RUN.
APPROACHES TO THE STUDY
OF MARKETING
marketing is the process of selling something at a
market place or at a shop. Some persons thought
market as the study of individual commodities and
their movement in the market place , some think it
as study of institutions and persons who move the
product , other take it as study of the behaviour of
product movements and the way persons involved
move them . Marketing is now concerned with
anticipating needs and directing the flow of goods
and services from producers to consumers .
Commodity approach
In this approach the main focus is
on a specific commodity , say
sugar , rice , wheat , automobile
etc . The subject matter of
discussion centers around the
specific commodity selected for
study . The marketing situations
of the commodity selected for
study is examined from the view
point of sources and conditions of
supply , nature and extent of
demand , the distribution
channels used for supply of
commodity , the functions such
as buying , selling , advertising ,
storage , financing etc .
Institutional approach
Institutional approach has been associated
with authors like COX , NYSTORM. In this
approach focus on various middleman and
facilitating agencies . the study includes
their position in the distribution channels ,
the purpose for their existence and the
various function performed by them .
For example when we are to study the
wholesalers , we will study the type of
function undertaken by them , the services
rendered to producers and retailers , the
mode of undertaking various activities ,
method of financing , and problem faced
and steps which may help in improving
their role
functional approach
This approach concentrates on the different functions
performed in the process of marketing the product
and services . Each function is analysed in the
relation to the importance of its performance . The
function is related to marketing are buying , selling ,
financing , risk bearing , transportation etc. by
studying and analysing each function and
understanded the problems related to them , it will
be possible to understand marketing properly .
These functions are also studied in relation to given
commoditied and marketing institutions in terms of
their nature , costs , importance and problems .
Managerial approach
In this approach the emphasis is on
the decision making process
involved in the performance of
marketing functions at the level of
a firm . Various underlying
concepts such as decision
influencing factors , alternatives
strategies and techniques and
methods of problem solving are
studied . In managerial approach
the thrust is on those functions
which are involved in the flow of
goods and services from producers
to consumers .
system
approach
This a recent approach and is based on von
Bartalanffy ‘ s general theory . He defined system as
a “ set of objects together with the relationships
among them and their attributes “. System approach
assumes the interrelationships and inter connections
among components of a marketing system in which
products , services , equipment , money and
information flow from marketers to consumers.
These flows have an impact on the survival or growth
capacities of a firm .
Societal
approach
This approach was born out of
criticism of the business that it
is more concerned with its
profit and expansion and
ignores the need and concerns
of the society . the focus of the
study in societal approach is the
interaction between the various
environment factors such as
legal , political , cultural and
impact of marketing decisions
on well being of society .
MARKETING AND SELLING
 Marketing is not selling , nor is it a sophisticated
word for selling but more comprehensive and
could be termed as the COCKTAIL SCIENCE .
Advantages of Marketing
 Marketing widens the market .
 Marketing facilitates exchanges in the








ownership and possession of goods and services
.
Marketing helps in optimal utilisation of
resources .
Marketing accelerates other activities .
Marketing increases the national income .
Marketing raises the standard of living .
Marketing provides gainful employment
opportunities .
Marketing stabilses the economic conditions .
Marketing acts as a basis for making decisions .
Marketing provides maximum satisfaction of
human wants .
Meaning of Marketing Management
Marketing
Management
• involves all efforts to create customers
for the products and provide maximum
satisfaction to them
• is the art of getting things done
through others
The term marketing
management refers to
planning , organising
, directing and
controlling of persons
and activities engaged
in the marketing
division of a business
enterprise.
Marketing
Manageme
nt
Marketing
Management
THE AIMS OR OBJECTIVES OF
MARKETING MANAGEMENT :
 Achieving higher productivity in its





marketing operations
Making optimum use of the available
resources
Enhancing the profitability of the enterprise
Providing maximum consumer satisfaction
Raising of standard of living of the people
Satisfaction of consumer wants
Meaning of marketing
Management
MARKETING MANGEMENT ;
Is Practical application
of marketing techniques and the
management of a firm's resources
and activities.
PRINCIPLES OF MARKETING
MANAGEMENT
•Principle of Direction
•Principle of Planning
•Principle of Organization
•Principle of Objectivity
•Principle of Motivation
PRINCIPLES OF MARKETING
MANAGEMENT
•Principle of Control
•Principle of Sales Promotion
•Principle of Consumer
Satisfaction
•Principle of Research &
Development
Marketing Management
v/s
Marketing
BASIS
1.
Meaning
2. Activities
MARKETING
MANAGEMENT
It is concerned with the
decisions and policies
pertaining to the
marketing activities of
an enterprise.
It includes planning,
organising, directing
and controlling.
MARKETING
It refers to the
performance of those
activities which direct the
flow of goods and services
from the producer to the
consumer.
It includes buying, selling,
transportation, storage,
warehousing,
standardising, grading,
packaging, and advertising
etc.
Marketing Management
v/s
Sales Management
BASIS
MARKETING
MANAGEMENT
SALES
1. Meaning
Marketing management includes
research (identifying the customer
needs), development of products
(producing innovative products)
and promoting the product
(through advertisements) and
create awareness about the
product among the consumers.
Once the product is out in the
market, it is the task of the sales
person to persuade the
customer to buy the product.
Therefore sales means
converting the leads or
prospects into purchases or
orders.
2. Period
Marketing management aims at
long-term goals.
Sales aim at short-term goals.
3. Process
Marketing management involves a
long-term process of building a
name for a brand and pursuing a
customer to buy it even if they do
not need it.
Sales is a short-term process of
finding the target consumer.
BASIS
MARKETING
MANAGEMENT
SALES
4. Focus
Marketing management
focuses on satisfying the
consumer needs.
Sales only focuses on
converting consumer
demand to match the
products.
5. Target
Marketing management
targets a larger group i.e.
the general public.
Sales targets on individuals
or small groups.
6. Methods used
Marketing management
uses methods like
Advertising, Brand
Marketing, Public Relations,
Direct Mails, etc.
Sales are interpersonal
interactions and involve
one-on-one meetings,
networking and calls.
NATURE OF
MARKETING
MANAGEMENTAN ART OR
SCIENCE?
MARKETING MANAGEMENTAN ART
Art is concerned with the application of knowledge and skills.
The essential features of Art are : Personal Skill
 Practical Knowledge
Regular Practice
 Creativity
Marketing is an art, one has to use his skill and knowledge in
solving many complicated problems to achieve the enterprise
objectives.
MARKETING MANAGEMENTA SCIENCE
Science is a systematised body of knowledge which establishes relationship
between cause and effect.
The essential features of Science are : Sytematised body of knowledge.
 Continued observation
 Principles are exact and have universal
applicability
Marketing management is viewed as a science as it
is an organised body of knowledge built up by the
management practitioners, thinkers and
philosophers over a period of years.
Marketing ManagementA Science as well as an Art
IN FACT, IT IS A SCIENCE AS WELL AS AN
ART BECAUSE SCIENCE AND ART ARE
BOTH COMPLIMENTARY TO EACH
OTHER. THE FORMER (SCIENCE) WILL
HAVE TO SOLVE PROBLEMS AND
ESTABLISH PRINCIPLES WHICH MIGHT
BE APPLIED WITH BENEFIT TO THE
LATTER (ART).
EVOLUTION OF
MARKETING
The term Marketing is thought to have
originated in the United States between 1906
and 1911. Marketing did not have the same
thrust-that of facilitating, satisfying
exchanges-that it has today. The earlier
emphasis was on the selling activities that are
undertaken only after goods have been
manufactured. The present thrust is not
confined to selling only.
Marketing is commonly believed to have
progressed through three distinct phases of
evolution since the beginning of time: the
production era, the sales era, the marketing era.
Production Era
Sales Era
Marketing Era
PRODUCTION ERA
•The Production Era was first known as the simple trade era and
it began in the 1600s .
•This era assumed that consumer will always respond to
products that are available to them.
•There was no competition.
•The attitude was such that the sales department will sell
whatever plant produces.
•The marketing process starts after production process & ends
with delivery of products to consumers.
SALES ERA
•The sales era (1920′s – 1940′s) followed the production era.
•As more and more firms became efficient in producing goods,
competition among companies intensified.
•Companies had to work harder to sell their product to
consumers.
•Commoditization emerged: products became commodities
and price became the distinguishing competitive advantage.
•The firms also started contacting the customers through
advertisements and salesmen.
MARKETING ERA
•In Early 1950’s firms moved into marketing era and it
is continuing at present also
•It is a customer oriented period where business should
make products that customers want.
•Now customers needs are determined first and then
products are developed to satisfy them
NEW HORIZONS IN
MARKETING
Marketing is a dynamic discipline. There are new situations and new challenges
that are coming up and to suit these new situations, new concepts have recently
emerged.
NEW
CONCEPTS
SOCIETAL
MARKETING
CONCEPT
METAMARKETING
DEMARKETING
MACROMARKETING
SOCIETAL MARKETING
CONCEPT
The societal marketing concept is a
management philosophy that
considers the welfare of the
society as well as the interests of the
firm and its customers.
The societal marketing concept calls for a customer
orientations backed by integrated marketing aimed
at generating customer satisfaction and long-run
consumer welfare as the key to attaining long-run
profitable volume.”
META-MARKETING
Meta-Marketing is associated with the
application of marketing to non-business
organisations. These organisations make efforts
to reach the targeted groups. The marketing
principles are used to influence the persons
who are targeted by the organisation in the
same way as other marketing organisations.
•Some of the examples are :BIRTH CONTROL
EDUCATION
NO SMOKING ORGANISATIONS
POLIO CAMPAIGN
Therefore these non-business organisations have to
use the same tools to reach their audience as is used
by other organisations associated with marketing.
DEMARKETING
Demarketing concept is of a recent origin. It is needed
when demand exceeds supply and efforts are made to
discourage customer from demanding that
product/service. Demarketing is that aspect of
marketing that deals with discouraging customers or a
certain class of customers. The excess demand
situations have also to be dealt in the same way as the
situations of excess supply have also to be tackled in
marketing. Therefore to reduce the level of total
demand a cautious approach is required to be followed
without alienating the customers
MACRO-MARKETING
This concept refers to the study of marketing within the
content of the entire economic system with special
emphasis on its aggregate performance. The emphasis with
macro-marketing is not on the activities of an individual
organisation, instead the emphasis is on how the whole
marketing system works. This includes looking at how
marketing affects society and vice-versa. The producers in
the production systems have different objectives, resources,
skills, etc. Likewise, there are differences in customers
needs. Therefore macro-marketing system tries effectively
match demand and supply and at the same time
accomplish society’s objectives.
PROCESS OF MARKETING
The prime aim of marketing is to see that the goods
and services move from the producers to the ultimate
consumers .
1. CONCENTRATION
2. EQUALISATION
3. DISPERSION
CONCENTRATION
Concentration means bringing the goods at some important
and convenient centers to make possible effective and
economical distribution. Goods are collected from small
producers at central points to enable the retailers to have
adequate stocks of producers of various qualities to meet
the requirements of their customers.
Concentration is an essential process of marketing : to collect natural goods produced in small lots at
different places.
 to produce various specialised parts required by
assembling industries ;
 to ensure continuous and ready supply of different
products.
EQUALISATION
The process of equalisation occurs between the process of
concentration and the process of dispersion. The goods
produced and concentrated in the markets have to be
adjusted to meet the requirements of the people. The need
of equalisation arises on account of :
 there may be a seasonal production but continuous
consumption;
 there may be a continuous production but seasonal
consumption;
 there may be difference in terms of quality requirements
; and
 there may be difference in terms of quantity
requirements.
DISPERSION
Dispersion means distribution of goods which are
concentrated to the ultimate consumers. The
process is performed through wholesalers,
retailers, agents, etc. Dispersion completes the
process of marketing and is very important
activity because the goods produced and
concentrated have no value unless these are
properly distributed to the centers of final
consumption.
MARKETING ENVIRONMENT
An environment consists of everything
surrounding a firm. Marketing environment
includes all the forces outside an organisation
that directly or indirectly influence its marketing
activities. All the elements of environment may
not have the same influence on the marketing
activities of the firm. Some elements are more
direct in their effects than others. Sometimes part
of the marketing environment may seem difficult
to assess in terms of their likely impact on a firm.
ELEMENTS OF MARKETING
ENVIRONMENT
INTERNAL
MICROMACROENVIRONMENT ENVIRONMENT ENVIRONMENT
INTERNAL ENVIRONMENT
All factors that are internal to the organization
are known as the 'internal environment'. They
are generally audited by applying the 'Five Ms'
which are Men, Money, Machinery, Materials
and Markets. The internal environment is as
important for managing change as the external.
As marketers we call the process of managing
internal change 'internal marketing’.
MICRO MARKETING
This environment influences the organisation directly. It includes
suppliers that deal directly or indirectly, consumers and customers, and
other local stakeholders. Micro tends to suggest small, but this can be
misleading. In this context, micro describes the relationship between
firms and the driving forces that control this relationship. It is a more
local relationship, and the firm may exercise a degree of influence.
Following are the elements which effect the marketing activities :
Customers
 Competitors
 Intermediaries
 Suppliers
 Pressure groups
 Government
Customers
Customers are an important element of microenvironment. A firm produces goods and services for
the customers. A commercial organisation cannot exist
without customers. So every organisation is required to
understand the requirements of its customers and
should keep in touch with these changing needs by
using an appropriate information collecting system.
Competitors
Competition usually means others that market similar or
substitutable products in the same geographic area. In
general the term competition refers to rivallary among
businesses for getting consumers. The most important thing
is to identify your competitor and then keep an eye on his
product , marketing policies, etc. A firm can differentiate
itself by adjusting the elements of its marketing mix or by
providing a product that is superior in some way to those of
competitors.
 INTERMEDIARIES
The role of intermediaries such as wholesalers, retailers,
agents, etc. is important for marketing goods and services.
Channels of distribution comprise of those intermediaries
which help in transferring goods/services from producers
to consumers. Some producers may try to reach the
customers directly but this may be possible for limited
items only. Big producers cannot afford to avoid the
intermediaries. The number of intermediaries added to the
chain of distribution will depend upon the volume of
production and the geographical areas to be covered. The
intermediaries will add to the price available to the
customers.
SUPPLIERS
Suppliers form an important element of marketing
environment. The manufacturers of goods need regular
and reliable supplies of raw materials. If the supplies are
received at a reasonable price then the manufacturer gets
the advantage of charging lower prices in a competitive
market where reliability of delivery to customers is
crucial, unreliable suppliers may thwart a
manufacturer’s marketing efforts. The one company’s
supplier may be another company’s customer. So, there is
a link between suppliers, manufacturers and
intermediaries.
PRESSURE GROUPS
Pressure groups are basically operating in the market
and they have a direct link with the marketing
activities. These pressure groups may be working for
an objective. Such groups may dissolve or permanently
fight for a cause. Members of a pressure groups may
create adverse publicity or create awareness about a
particular cause through press releases. Action can be
taken in the form of demonstration or dharna. The
activities of these groups should be taken care by the
companies and necessary action should be taken by
them.
GOVERNMENT
Government also plays an important role as a part of
marketing environment. Business organisations provide
revenue to the government in the form of taxes, so a
healthy business sector is in the interest of government.
Business organisations are now expected to take up
social responsibilities and perform some functions
which otherwise would have been performed by public
sector. Certain objectives like balanced regional
development are also achieved through the efforts of
the business. Besides customers, business is expected to
satisfy regulatory agencies also.
MACRO ENVIRONMENT
This includes all factors that can influence an
organisation, but that are out of their direct control. A
company does not generally influence any laws. It is
continuously changing, and the company needs to be
flexible to adapt. There may be aggressive competition
and rivalry in a market. Globalization means that
there is always the threat of substitute products and
new entrants. The wider environment is also ever
changing, and the marketer needs to compensate for
changes in culture, politics, economics and technology.
Macro-environment basically deals with the external
environment and can be audited in more detail using
other approaches such as SWOT Analysis and Michael
Porter's PEST Analysis.
Macro-environment divides the environment
into a number of subject areas. These subject
areas are : Economic Environment
 Social and Cultural Environment
 Political Environment
 Demographic Environment
 Technological Environment
ECONOMIC ENVIRONMENT
The economic conditions comprise of consumer buying
power, income, discretionary income, consumer
spending behaviour etc. the buying power depends on
the extent of the person’s resources and the state of the
economy. Marketers analyse consumer spending
patterns to identify general trends in the ways that
households spend their money on various kinds of
products. Such type of analysis will help marketers
gain both a perspective and a background for decision
making. So, the market conditions of a country will
certainly influence demand and supply of goods.
SOCIAL AND CULTURAL
ENVIRONMENT
It is necessary to understand the social and cultural
values of the people where a company wants to market its
products. In order to satisfy consumers needs, an
organisation should understand the gradual changes in
social and cultural environment. With the increase in
purchasing power, the needs for leisure goods may be in
demand at one time and another type of goods and
services may be in demand at a different time. Therefore
a business organisation has to constantly monitor the
changing needs of the people and plan the products and
services accordingly.
POLITICAL ENVIRONMENT
Political environment directly or indirectly influences marketing
environment. The liberalisation policy followed by Government of
India in 1991 allowed free entry to international business. It created
competitiveness in Indian markets and domestic producers had to
change their production strategies. The political stability is another
important factor which influences the markets. Foreign investors may
be cautious in entering into in a country where there is no political
stability. Government is responsible for formulating the policies that
can influence the rate of growth of the economy and hence the total
amount of spending power. The distribution of spending power
between different groups and sections of society and between different
sectors is also a political decision. So political environment has to be
kept in mind while framing marketing policies.
DEMOGRAPHIC ENVIRONMENT
Demography is the study of population in terms of their
size and characteristics. The age structure of a country,
the geographic distribution of population, balance
between males and female, likely size of populations and
its characteristics are very important for a marketing
concern. The needs and requirements of persons in
different age groups are different and different
characteristics of population have direct bearing on
marketing environment. The changes in the demographic
pattern of population create new demands for goods and
services. A marketer will have to change its products
according to the new needs.
TECHNOLOGICAL ENVIRONMENT
Technology can be defined as the method or technique for converting
inputs to outputs in accomplishing a specific task. Thus, the terms
'method' and 'technique' refer not only to the knowledge but also to the
skills and the means for accomplishing a task. Technological innovation,
then, refers to the increase in knowledge, the improvement in skills, or
the discovery of a new or improved means that extends people's ability to
achieve a given task. Technology can be classified in several ways.
For example, blueprints, machinery, equipment and other capital goods
are sometimes referred to as hard technology while soft technology
includes management know-how, finance, marketing and administrative
techniques. When a relatively primitive technology is used in the
production process, the technology is usually referred to as labourintensive. A highly advanced technology, on the other hand, is generally
termed capital-intensive