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Micro Environment

The micro environment surrounding a company includes suppliers, intermediaries, competitors, and customers. Suppliers problems can impact customer satisfaction. Intermediaries help promote and distribute products. Competitors must be outperformed to gain strategic advantage. Customers are the most important actor and the goal is to create strong relationships. The macro environment consists of broader demographic, economic, natural, technological, political, and cultural forces that shape opportunities and threats for companies.

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Ailyne Cabuquin
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673 views

Micro Environment

The micro environment surrounding a company includes suppliers, intermediaries, competitors, and customers. Suppliers problems can impact customer satisfaction. Intermediaries help promote and distribute products. Competitors must be outperformed to gain strategic advantage. Customers are the most important actor and the goal is to create strong relationships. The macro environment consists of broader demographic, economic, natural, technological, political, and cultural forces that shape opportunities and threats for companies.

Uploaded by

Ailyne Cabuquin
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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MICRO ENVIRONMENT

The environment which is close to the company that affects, positively or negatively and it creates value
and relationship with its customers. Marketing success will require building relationships with other
company departments, suppliers, marketing intermediaries, customers, competitors, and various
publics, which combine to make up the company’s value delivery network. Micro environment that
surrounds organization can be complex by nature; however company has an element of control over it.

Some of the factors which affect the micro environment are:

SUPPLIERS

Suppliers form an important link in delivering the value to the customers. Suppliers problem can
seriously affect the marketing. Therefore marketing management must watch supply availability and
costs. Supply shortage or delays, labor stricken and other events can damage customer satisfaction in
the long run and rising supply costs can harm the company sales volume.

INTERMEDIARIES

Market intermediaries help the company to promote, sell, and distribute its product to the final buyers.
It includes retailers, wholesalers, physical distribution firms, financial intermediaries. Physical
distribution firms help the company to stock and move goods from their point of origin to their
destination. Today’s marketers recognize the importance of working with the intermediaries as partners
rather than simply channels through which they can sell their product.

COMPETITORS

The marketing states that the company must provide greater customer value and satisfaction than the
competitors do. They can gain strategic advantage by strongly offering against competitors offerings in
the minds of consumers. As, large firms dominant positions in an industry can use certain strategies
which the smaller firm cannot afford. But being larger is not enough. There are winning strategies for
large firms, but there are losing one’s too.

CUSTOMERS
Customers are the most important actor in the microenvironment. The aim of the e3ntire delivering
system is to serve the target customers and create the strong relationship with them.

MACRO ENVIRONMENT

Macro environment consists of broader forces that shape opportunities and pose threats to company.

It shows six major forces in the company’s macro environment. These are:

DEMOGRAPHIC ENVIRONMENT

The study of statistics of births, deaths, disease etc in order to show the state of population is known as
demography. The demographic environment refers to the level of population growth, age, sex,
education patterns, family influences etc.

ECONOMIC ENVIRONMENT

Economic environment comprises the nature of economic system of the country, the structural anatomy
of the economy, the economic policies of the government, the nature of factor endowment and
markets.

NATURAL ENVIRONMENT

The physical and geographical factors can play a predominant role in constituting the non-economic
environment and thereby affecting the business. The application of modern technology leads to rapid
economic growth at a huge social-cost deterioration of the physical environment i.e. air pollution, noise
pollution, and water pollution. The nature of such costs is being assessed by biologists, ecologists, and
sociologist.

TECHONOLOGICAL ENVIRONMENT

Technology shapes the future of any society. Marketer must watch the changes in the technology for
keeping track of competition and customer wants. In the modern world, the pace of technological
changes is very fast. Technological environment influence work at the organization in terms of
investment in technology, consistent application of technology and the affects of technology on
markets.

POLITICAL ENVIRONMENT

It provides the legal framework within which the marketer is to function. The viability of business
depends upon the ability with which it can meet the challenges arising out of the political environment.
The political environment of a country is influenced by political organizations, political stability and
foreign policy etc. all these factors have a bearing on business.

CULTURAL ENVIRONMENT

The culture environment of a nation determines the value system of the society which in turn affects the
marketing of products. Sociological factors such as caste structure, mobility of labor, customs, cultural
heritage, etc. might have far reaching impact on business. Cultural environment also determines the
code of conduct the business should follow.

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