Marketing Environment: Definition, Micro & Macro, and Environmental Scanning

What is Marketing Environment

Marketing Environment concerns the influences or variables of the external and internal environment of a firm that controls the marketing management’s capability to construct and preserve the flourishing relationships with the consumer. An assortment of environmental forces affects a company’s marketing arrangement. A few of them are governable while others are unmanageable. It is the task of the marketing manager to modify the company’s policies together with the shifting environment. Macro and micro environment comprise the structure of the marketing environment.

Definition of Marketing Environment:

According to Philip Kotler,

“A company’s marketing environment consists of the internal factors & forces, which affect the company’s ability to develop & maintain successful transactions & relationships with the company’s target customers.”

Overall Market Environment

The overall Marketing environment is the snowballing form of the aspects that encapsulate inside themselves the capability of a firm to bond with the customers and also, the strength of the product as a driver of development to the firm. The macro-environment consisting of wider societal authorities, and the micro-environment which incorporates the influences related to a company, together form the general marketing environment of a company.

→ Thus, the marketing environment is comprised of the following two key factors-

Micro-factors inside the firm
Macro-factors linked to economic, social, cultural aspects, etc.


Micro & Macro Environement in Marketing

We’ve thoroughly explained the difference between micro and macro environment in a separate article here ➡️

Micro Environment in Marketing

Micro-environment elements are close to the firm and incorporate the suppliers, showcasing delegates, consumer markets, public, competition, and marketing intermediaries. Micro-environment likewise concerns the inward environment of the organization and influences marketing as well as all the departments like management, R&D, finance, Human assets, purchasing, operations, and bookkeeping.

Macro Environment in Marketing

The Macro environment is the uncontrollable factor of the company. For this reason, it has to structure its policies in the limits set by these factors. Macro-environment on the whole deals with the demographic, economic, technological, natural, socio-cultural and politico-legal environment aspects of the markets. Let us now look into these elements in detail.

1. Demography

It is characterized as the factual investigation of the human populace & its dissemination. This is a standout amongst the most impacting variables because it manages the individuals who structure the business. An organization ought to study the populace, its conveyance, age structure, and so forth before choosing its strategy of marketing. Each faction of the populace acts differently, relying on a range of factors, for example, age, status, and so on. If these variables are measured, a company can manufacture only those products which suit the necessity of the buyers. In this respect, it is said that ‘to comprehend the business sector you must comprehend its demography’.

2. Economic Environment

Economic components are general monetary value, investment rates, exchange rates, inflation rate, fiscal strategies, balance of payments and so forth. An organization can effectively offer its products just when individuals have enough cash to spend. The financial environment influences a customer’s buying behavior either by expanding his disposable income or by decreasing it. Eg: During inflation, the money value decreases. Thus, it is troublesome for them to buy more products. The income of the customer should likewise be considered. Eg: In a business sector where both wife & husband work, their acquiring power will be more. Consequently, organizations may offer their products effortlessly.

3. Physical Environment

These components incorporate the climate, atmosphere, environmental change, accessibility of water, accessibility of raw materials and so on. A company has to implement its policies contained by the restrictions set by nature. A man can enhance nature, however, can’t find an option for it. Nature offers resources, however, in a restricted way. The product manager has to use it proficiently. Companies must discover the best mix of products for productive usage of the accessible assets. Else, they may confront intense deficiency of resources.

4. Technological Factors

Technological variables incorporate the innovative work, robotization, development of web and other communication innovations, innovation inducements and barriers to technology. From the consumer’s perspective, change in innovation implies a change in the living standard. In this respect, it is said that ‘Technologies figure a person’s Life’.

Each innovation creates another business & another group of clients. Another innovation enhances our way of life & in the meantime creates numerous issues. Eg: Invention of different purchaser comforts like washing machines, blenders, and so forth have brought about enhancement in our way of lifestyle yet it has made serious issues like shortage of power, similarly, innovation in autos has enhanced transportation, however, it has brought about the issues like air & noise contamination, more accidents etc. In plain words, the following are the effects of technological aspects on the market:

  • Creation of new desires
  • Creation of new industries
  • May wipe out old industries
  • May augment the expenditure on R&D.

5. Social & Cultural Factors

The vast majority of us buy in light of the impact of cultural & social elements. The lifestyle, qualities, convictions, and so on is dead set besides everything else by the society in which we live. Every society has its own culture. Culture is a blend of different variables which are exchanged from more established eras & which are gained. Our conduct is guided by our way of life, family, instructive foundations, dialects, and so on. Social components are the cultural and social viewpoints, which incorporate health cognizance, the growth rate of population, age distribution, career approach and the importance of security.

The society is a mix of different groups with diverse cultures & subcultures. Every society has its conduct. The marketing manager of a company must study the society in which he works. Eg: In India, we have distinctive cultural groups like Kashmiris, Punjabis, Assamese, and so forth. The manager of marketing of a company ought to observe these distinctions before finalizing the marketing schemes.

The detailed scanning of the environment of the business is very important which can be done by the process of environmental scanning that helps to identify the various opportunities and threats.

Environmental Scanning

The detailed and continuous process by which an organization monitors its internal and external environment is termed as ‘Environmental Scanning’. The process is aimed at identifying the risks and opportunities that can affect an organization’s prospect or direction.

We’ve thoroughly explained the environmental scanning in a separate article here ➡️


Thus, when a marketing manager is considering putting forward a marketing plan, then he has to consider both the internal and external marketing environments and see both opportunities and threats to the business; only then he/she would be able to take the correct decisions regarding the business.