Environmental Factors as They Relate to Marketing for a Business
At all times, besides focusing on assessing and satisfying consumer needs and wants, environmental factors such as social, economic, technological, competitive and regulatory factors play an important role in forming an organization’s marketing activity (Kerin, Hartley& Rudelius, 2009 pg35). These forces are uncontrollable and yet cause great impact in a marketing decision. For instance, the technological advancement that takes place influence the marketing strategies of E-bay company.
They use internet and websites to market their products and services. Besides that, economic downturn that occurs in recent times triggers a lot of discounts and promotions offered by company in selling their products and services. Now the problem is , what should the company do in order to stay current with their marketing tactics in these environments? Firstly, there is a common marketing strategy tool used by most of the companies--- SWOT analysis.
SWOT analysis is used to evaluate the strengths, weaknesses, opportunities and threats involved in a business. Particularly in the opportunities and threats parts, they are used to identify the environmental or external factors that affect the marketing decisions. Under the opportunities section, a company manages to identify some positive trends in their fields. For example E-Bay company come out with success as the company’s marketing strategy is current with technological advancement and globalization that crop up in this era.
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By analyzing the threats in SWOT analysis, a company is able to identify negative external conditions, for example economic downturn and competitions that will reduce sales or even causing downsize of a company (Hansen & Hansen, n. d. ). Therefore using SWOT analysis, a company can come up with new marketing tactics that can make use of the opportunities or cope with the negative trends that caused by the environmental factors. Besides SWOT analysis, environmental scanning is one of the best methods for the companies in the dynamic environment to stay current with their marketing tactics. Read about benefits of environmental scanning
According to Wikipedia, environmental scanning is a process of gathering, analyzing, and dispensing information for tactical or strategic purposes. Environmental scanning is helpful in detecting scientific, technical, economic, social, and political trends and events. It also useful in defining the potential threats, opportunities, or changes for the organization implied by those trends and events, promoting a future orientation in the thinking of management and staff, and alerting management and staff to trends that are converging, diverging, speeding up, slowing down, or interacting (Morrison, 1992).
Hence, developing marketing strategies that are appropriate and applicable to the current environmental trends are made possible to the company by using environmental scanning. Lastly, competitive analysis is one of the greatest methods for company. Competitor analysis is an assessment of the strengths and weaknesses of current and potential competitors. It will provide company with a distinct advantage, the barriers that can be developed in order to prevent competition from entering your market, and any weaknesses that can be exploited within the product development cycle (Competitive Analysis, 2006).
It is important for a company to consider its present and potential competitors in designing its marketing strategy. Due to the low barriers of entry in the field, E-Bay company have met many of its competitors such as Arizona. com. In order to be outstanding among the competitors, E- Bay company can make use of competitive analysis to obtain information about important competitors and use that information to predict competitor behavior. All in all, assessing competition is a key to success.
Overall, SWOT analysis, environmental scanning and competitive analysis are the best methods for companies in dynamic environment to stay current with their marketing tactics. In spite of all the uncontrollable environmental factors that might affect the sales or performance of a company, it still can survive or even flourish during the hard times if some researches regarding the environment changes have been done prior to the planning of marketing strategy.
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Environmental Factors as They Relate to Marketing for a Business. (2018, Jul 27). Retrieved from https://phdessay.com/environmental-factors-as-they-relate-to-marketing-for-a-business/
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