Macro and Micro economics research - Essay Example

? Macro and Micro Economics Institute: Macro and Micro economics Micro environmental factors Micro environmental factors are those that affect the non-capacity of the company to serve and produce products to the market. These factors are often considered as external and are past the company’s control. The success of the company mainly relies on how it adapts to this environment (Keane & Rogerson, 2011, pp 26). Some of these Micro environmental factors include suppliers, market intermediaries and the customers. Suppliers: The Company’s suppliers may change its marketing capabilities and competitive position. These include the capital, labor suppliers, suppliers of energy and suppliers of raw materials. The relationship between the company and the suppliers characterizes a power equation amongst them. This equation depends on the company’s condition and the extent that they depend on each other. A suppliers bargaining power may be increased if the seller company is an oligopoly or a monopoly company. It may also be increased if the supplier does not have to compete with other substitute products (Keane & Rogerson, 2011, pp 34). The buyer may also not be a significant customer to firm or the product of the supplier is a critical input in the finished product and business of the buyer. Another vital situation that may increase the suppliers bargaining power is when the supplier poses a menace of forward integration. Market Intermediaries: Each producer must always have several intermediaries for distributing, selling and promoting the services and products to customers. These intermediaries may be business or individual companies. These intermediaries include financial institutions, agents of distribution and middlemen such as retailers and wholesalers. Customers: These also constitute one of the significant micro environmental factors and they may be classified as public, competitors, international customers, resellers, industrial customers and the ultimate customers. Industrial customers are the companies that purchase products and services that are used in the production of other products or services. Resellers are the intermediaries who buy products with an aim of reselling them at a profit (Keane & Rogerson, 2011, pp 54). These may include distributors, retailers and wholesalers. Competitors sell products and services of the same description. A public is any group that has a potential interest on the ability of a company to achieve its goals and objectives. Macro environment Macro environment factors are also external to the firm and cannot be controlled. These factors hardly have any effect the marketing capability but affect the decisions of marketing within the company. Macro environmental factors may include the following: Cultural and Social Forces: This idea is considered in marketing literature as a substitute to the concept of marketing. The social forces try to make marketing as a practice that is socially responsible. This implies that companies ought to eradicate products that are socially harmful and only produce what may be valuable to society. Legal and political forces: Development in the legal and political field highly affects the decisions of marketing. Marketing decision may not be taken without considering the political parties in power, governmental agencies and laws regarding land. These variables often develop remarkable pressures on management of marketing. Laws often affect promotion and pricing, product design, capability and product capacity. In almost all the countries, the government always intervenes in the process of marketing despite their political beliefs. Demographic forces: In this situation, the marketer examines the population since the people create markets. Economic factors: The economic environment is made up of macro level factors that relate to a distribution and production means that affects the business of a company. Physical forces: These include the renewable and non-renewable resources of the earth. Renewable forces include food products and the forest. Non-renewable resources include minerals, coal and oil. These components often change the level of resources that are necessary for a marketer. Market Segmentation Market segmentation means the subdivision of a market along some kinship, similarity or commonality. This means that members of a market segment always have something in common. Market segmentation is meant to concentrate the marketing energy to achieve a competitive advantage. The following are the types of marketing segmentation: Geographic Segmentation This is one of the most known segmentation. In this situation, firms segment the market by attacking a constrained geographical region. For instance, corporations may decide to market their products in some countries and avoid other countries. Certain products may only be sold in a certain country, or region in America (Keane & Rogerson, 2011, pp 65). This is quite common with the restaurants, which are known to choose only some geographical regions to sell and market their products. For instance, a picante sauce may decide to market its product in the southwest of the U.S. Distribution Segmentation Various markets may be reached via diverse distribution channels. For instance, a firm may segment the “flea and tick collar” market by selling marketing their products in the supermarkets under a single brand name, to veterans under a different brand name and to pet stores with a distinct brand name. This is quite a common distributional segmentation, especially in small companies that give every channel an exclusive brand to ensure effective distribution in that channel. Media Segmentation This is not a common type of segmentation, but it occurs in rare occasions. This is because various media target diverse audiences. If a company decides to market all its products on a single media house, it may end up marketing its products to a certain audience that view the channels in that media station (Keane & Rogerson, 2011, pp 73). This type of segmentation is often done by firms that have some control of media and may in some way deject contenders from using the same media house. Price Segmentation This is quite a common segmentation that is under practice. Disparity in household incomes develops a prospect for segmenting markets based on price dimensions. If personal incomes vary from high to low, the company ought to offer some affordable products, expensive ones and also medium-priced products. This type of price segmentation is demonstrated by the series Automotives that General motors’ markets. The prices of Cadillac, Buick, Oldsmobile, Pontiac and Chevrolet vary along a defined scale to appeal to those who have higher incomes. Time Segmentation This is not quite common but is always effective. In this case, some business always remain open in late hours compared to others, or may open during the weekends. There are also some companies that sell their products on certain periods of the year such as Christmas. The marketing of chili is often done in during cooler weather. The Olympic Games are also done on different weather. For example, basketball is on spring and winter. Time dimensions often create fascinating ways of segmentation (Keane & Rogerson, 2011, pp 75). Markets may also be segmented by religion, political affiliations, hobbies and special groups of interest. References Keane, M. P., & Rogerson, R. D. (2011). Reconciling micro and macro labor supply elasticities a structural perspective. Cambridge, Mass, National Bureau of Economic Research. http://papers.nber.org/papers/w17430. Read More