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External Marketing Environment - Essay Example

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External Marketing Environment

A firm is frequently oblivious about the factors that affect its future. A marketer can comprehend the marketing environment through conducting a marketing research. Acquaintance to the environment assists an organization to modify its promotional mix and recognize new opportunities. Lamb et al (2011, p. 110) cites economic, cultural and social, business, legal and political and demographic elements as the constituents of external marketing environment. Economic Environment There is no more significant component in the external environment affecting marketing than the economic environment. Lamb et al (2011, p111) notes that the economic environment affects the operation of a company on both at micro and macro levels. Micro level refers the individual company while the macro level implies the broader industry, country or international. i. Supply and Demand When there is absence of government intervention and control, supply and demand are the basic underlying forces of the economic dimension. Supply refers to the amount of goods and services sellers and producers are willing to bring to the market at given prices at given time (Lamb et al., 2011, p. 112). Demand on the other hand refers to the amount of goods and services the buyers are willing to buy at a given price and time. ...
When such a situation occurs, there is either a shortage or a surplus. In a competitive market structure, when a surplus or a shortage occurs, changes occur until equilibrium is restored. In the case of a surplus, the price is usually lowered to meet the demand level in the short run. In the long run, either the supply will decrease, as the quantities offered are decreased by some firms making production cuts or by other firms going out of business. When a shortage occurs, a company must carefully assess whether this condition id temporary or is actually a market need not being satisfied. ii. The Market and Exchange In every market economy there is a way for the market equilibrium price and quantity to be achieved. The mechanism for doing this by bridging the gap between supply and demand is the market place itself. Market place bridges the gap between what is produced and what is consumed, making the right quantity available to meet the market need (Lamb et al, 2011, p., 113) iii. General Economic Change The economic conditions in a country and the state of national economy change over time. Movements and fluctuations in the economy often follow patterns and have been described as business cycles (Lamb et al, 2011, p. 113). These cycles historically have consisted of four stages which include recession, prosperity, depression, and recovery. Cultural and social Environment In reference to Lamb et al (2011, p. 114), the cultural-social environment is replicated in the other four major environments external to the organization’s marketing mix. These environments include the economic environment, in the types and amounts of goods and services purchased, the business environment, in the distribution structure developed for the delivery of goods and services and the ...Show more

Summary

External Marketing Environment Introduction Overtime, the promotional plan must be modified due to the transformations of the setting in which customers live, work and make buying resolutions. This implies new customers will be targeted by the organization while others will be left out…
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External Marketing Environment essay example
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