Marketing environmental variables

  

Date Posted: 4/12/2012 9:36:05 AM

Posted By: sashoo  Membership Level: Silver  Total Points: 382

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MARKETING ENVIRONMENTAL VARIABLES
Business activities do not operate in a vacuum. But they are surrounded by environmental variables, which affect them, either positively or negatively. These marketing environmental variables are categorized into two, namely:

1. Controllable variables.
2. Uncontrollable Variables.

1. CONTROLLABLE VARIABLES
These refer to those variables that can be easily controlled by a business-man or a company to suit the demand of the business. They include the following:

• Product:
A company or marketer is said to have control over a product because he or she can undertake the following adjustments to suit prevailing demands of the business:

i) He can increase the capacity of output to cope with increasing demand.
ii) He can modify the product in terms of color, size, shape, fashion, design, e.t.c.
iii) He can change the package of the product and so on.

• Price:
A company or a marketer is said to have control over price of his products because he or she can undertake the following adjustments to suit the demand on business:

i) He can offer discounts.
ii) He can offer price reductions.
iii) He can use the money off e.g. he can use this slogan, “buy two get one free”.

• Promotion:
A marketer is said to have control over promotional activities of his organization because of the following factors:

i) He is able to select appropriate promotional media to use depending on different situations.
ii) He is able to select appropriate slogans to use for different market segments. He is able to do this because different advertising slogans are perceived differently in different market segments.

• Place or Distribution:
A company or a marketer is able to control distribution activities in his or her organization by way of choosing appropriate marketing channels to use in the distribution of his goods and services e.g. supermarkets, village shops, kiosks and multiple shops. This will enable customers

to get goods at the right time and place.

• Suppliers:
Companies can either increase the number of suppliers or decrease it.

2. UNCONTROLLABLE VARIABLES
These refer to those variables that a marketer has little or no control over them. But they can affect a marketer’s activities either positively or negatively. As such, a marketer has to devise ways of undertaking these activities under the umbrella of these variables. These variables include:

• Demography:
This simply refers to the study of human population as well as its structure. This can affect marketing activities in the following ways:

i) A low rate of population growth implies small potential market for goods and services, and vice versa.
ii) High mortality rate affects negatively the demand for goods and services. Demand for goods and services always decreases.

• Technology:
Changes in technology affect marketing activities either positively or negatively. However, the marketer has no control over them. As such, he needs to try and cope with the situation. Among some of this changes are:

POSITIVE CHANGES DUE TO TECHNOLOGY
i) It has resulted in high output capacity.
ii) Modern technology has enabled direct marketing. Direct marketing uses modern devices that enable producers to have direct access to ultimate consumers e.g. use of internet, telephone, fax, e-commerce, vending machines e.t.c.

NEGATIVE CHANGES DUE TO TECHNOLOGY
i) It has stimulated new markets and industries in fields that are not related to new technology.
ii) It has radically altered or virtually destroyed existing industries.
iii) Modern technology has led to the development of modern machines that are extremely expensive to acquire. Hence, it has negatively affected those firms that cannot afford it.

• Political stability:
When a country is stable politically, a marketer’s activities are boosted. As such a marketer is free to penetrate the market and serve all the customers. But during periods of political instability in a country, marketers’ activities are jeopardized.

• Legal Forces:
The government makes laws that govern a given country. These rules and regulations may affect marketing activities either positively or negatively.

• Social and Cultural Forces:
These include races, tribes, religion, class or status e.t.c. Due to these differences, the marketer has to produce what suits the market e.g. Muslims do not eat pork, while Christians do not smoke and drink beer e.t.c.

• Economic Forces:
When the economy of a country is booming, people’s purchasing power becomes high. Hence they are able to purchase more goods and services. Thus, a marketer registers high sales’ volume. But during economic recession, coupled with inflation and devaluation of a country’s currency, prices of essential commodities hike. Hence, people are not able to purchase all that they require due to limited purchasing power. Instead, they reduce their consumption levels. As such the sales of a company’s products will start to decline. This forces the marketer to derive techniques to improve the situation, for instance, offering discounts and so on.

• Competition:
A company has no control over the activities of competing firms. But to ensure a competitive strategy is laid down, it has to compete fairly by offering better services and other strategic techniques.

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