Why is it necessary for a marketer to study the changing marketing environment?

Marketing environment includes factors that affect the behaviour of consumers. These factors can be micro or macro and can be seen in the context of economic, social, political, and technological forces. In marketing, these factors can affect the product, price, and promotion strategies that a business chooses to implement. It is important for marketers to stay abreast of these factors and adjust their strategies accordingly. In marketing, there are six major elements that constitute the marketing environment.

The marketing environment is constantly changing and can be influenced by the changes in technology and society. The changing attitudes of consumers are crucial to the success of marketing. To stay ahead of competition, marketing firms must constantly study the needs and wants of consumers. This means studying the marketing environment and how it affects their success. Ultimately, it is up to the marketing manager to decide how to react to these factors. Luckily, marketing environments are constantly changing. Here are some of the key factors that influence marketing environment:

The health of the economy is an important part of the marketing environment. A down economy means consumers will be less willing to purchase a product. Also, budgets and social media platforms are often low-cost. All these factors affect the way that a company can advertise. Those marketing in a down economy are likely to be more risky than those that thrive in a thriving economy. So, what factors are important in a marketing environment?

The marketing environment includes both the internal and external factors that affect a company’s ability to develop and maintain customer relationships. This includes factors such as capital assets, employees, organizational structure, goods and services, and more. Once these factors are in place, a marketing manager can then adjust their strategies and activities to match these forces and circumstances. A marketing environment is crucial in making an effective and successful business. For instance, an organization must consider its marketing environment when determining the way to build relationships and influence customer behavior.

Information plays a vital role in the marketing environment. Changes in marketing practices change the importance of different types of information. Effective management of information and knowledge can lead to improved performance and competitive advantage. Models can help to measure and describe the information environment. Information Environment Model (IEM) is one such model that relates to the Integrated Model of Marketing Planning. Considering this information, a business can actually make better decisions. So, what should a marketing plan look like?

A marketing environment encompasses all the internal and external factors that drive and influence an organization's marketing activities. 

Marketing managers must stay aware of the marketing environment to maintain success and tackle any threats or opportunities that may affect their work.

A marketing environment is vast and diverse, consisting of controllable and uncontrollable factors. A good grasp of your marketing environment helps to:

• Identify opportunities: Understanding your marketing environment helps you notice and take advantage of market opportunities before losing your edge. For example, say your marketing team sees an uptick in digital buying over in-shop sales. You may decide to allocate more resources to your online marketing funnel to drive more sales. 
• Identify threats: Studying your marketing environment alerts you to potential threats which may affect your marketing activities. For example, a market leader could diversify their product portfolio to compete with your organization. Foreknowledge of this can help you restrategize your marketing efforts to maintain and grow your market share.
• Manage changes: Paying attention to the marketing environment also helps manage changes and maintain growth in a dynamic economy. Marketing managers can forecast and determine timely marketing campaign strategies by monitoring their marketing environment. 

Features of a marketing environment

The features of a marketing environment are typically: 

• Dynamic: The factors that affect marketing environments constantly change over time. These could be technological advancements, industry regulations, or even customer tastes. 
• Relative: Marketing environments are relative and unique to each organization. A specific product from your company may sell quicker in the U.S. than in Europe because of distinctions in the marketing environment.
• Uncertain: Market forces are unpredictable. Even with constant study, you may face unexpected threats or opportunities in your marketing operations. Adept marketers must be able to learn, pivot, and strategize quickly to achieve their goals.  
• Complex: The many internal and external forces in a marketing environment make it complex, with various essential moving parts. For example, you must coordinate your team’s ability and resources with stakeholder expectations, customer satisfaction, and other ethical and environmental concerns.

Types of marketing environments you should know

There are two significant types of marketing environments:

• Internal marketing environments
• External marketing environments

You can break down the external marketing environment further into: 

• Micromarketing environment
• Macro marketing environment

What is an internal marketing environment?

An internal marketing environment consists of factors that fall within your control and impact your marketing operations, including your organization's strengths, weaknesses, uniqueness, and competencies.

Think of essential marketing elements such as your people and teams, the quality of your product or service, capital assets and budgets, and company policy. Internal marketing environment factors are controllable.

What is an external marketing environment?

The external marketing environment includes all factors that do not fall within your organization's control, including technological advancements, regulatory changes, social, economic, and competitive forces. 

These factors may be controllable or uncontrollable, but defining and studying their changes and trends gives your business and marketing team some power to stay the course. The external marketing environment can be broadly categorized into micro and macro marketing environments. 

What is a microenvironment in marketing?

The microenvironment in marketing is closely linked to your business and directly affects marketing operations. It includes factors like customers, suppliers, business partners, vendors, and even competitors. Microenvironment factors are controllable to some extent.

What is a macro marketing environment?

Your macro marketing environment is made up of all the factors beyond the control of your organization. An easy way to remember these factors is by using the PESTLE acronym, which stands for:

• P: Political factors
• E: Economic factors
• S: Social and demographic factors
• T: Technological advancement factors
• L: Legal and regulatory factors
• E: Environmental factors

These factors are uncontrollable and can impact your business and marketing operations to a significant extent. Political changes, for example, may have a massive effect on how you can market and conduct your business in certain regions. 

Your macro marketing environment is continually changing. It’s vital to keep a close watch to identify potential threats or opportunities to your business. For instance, an unpredictable environmental change, like the COVID-19 pandemic in 2020, can significantly change the way we work, market, and do business globally. 

While it's true that the macro marketing environment can overwhelm a business and cause it to fail, it can also lead to growth. A curious perspective and healthy company culture that empowers employees and teams to share ideas, collaborate, and take creative risks will position your business for success.

Examples of a marketing environment

To help you understand the effects of different marketing environments, let's look at some examples.

• Internal marketing environment: Your internal company culture has an impact on how your employees behave, which in turn affects your marketing operations. An organization that emphasizes teamwork and collaboration, for example, will have more engaged employees. This, in turn, will help the organization perform better than competitors who do not share these values.
• Micro marketing environment: Say your business relies on a network of suppliers, distributors, and retailers to get your products to the customer. It's wise to build good relationships with these vendors, as any changes can influence your marketing strategy.
• Macro marketing environment: The shockwaves from the COVID-19 pandemic are still hitting marketers — first, social distancing and remote work changed how we market goods and services. Now, inflation and the rising cost of living loom large over the macro marketing environment.

Benefits of monitoring your marketing environment

The marketing environment is continuously evolving. Your team may bring in new members, customer tastes and needs change, or, as we saw in 2020, a worldwide pandemic can turn the working world upside down. 

Monitoring your marketing environments empowers your business to make strategic marketing decisions before it’s too late. Other benefits of tracking your marketing environment include: 

• Being more prepared for micro- or macro-environmental changes — you work from a place of power when you have data that positions your business marketing for success
• Gaining useful, qualitative information about your marketing environment, which helps develop successful marketing campaign strategies
• A better understanding of your customers' needs, resulting in a more satisfactory product or service
• Having the correct information to create marketing campaigns that do not cross legal and regulatory policies
• More effective budgeting and allocation of marketing resources
• The ability to recognize potential threats within your marketing environment and prepare good marketing strategies in time
• The ability to identify and leverage opportunities before your competitors
• Improving any weaknesses in your organization's marketing setup, processes, and operations
• Leveraging your unique strengths to build company reputation and successful marketing campaigns

What are the challenges of defining a marketing environment?

We can't downplay the benefits of defining and monitoring your marketing environment. Still, there is only so much we can accurately predict. Even with technological advancements, predictive software tools, and a keen eye on the marketing environment, some changes can't be forecasted or controlled. 

Techniques that work in one marketing environment may not work in the next. For businesses operating in multiple regions, this may prove a considerable challenge. The speed of change in the macro marketing environment may make it seem unnecessary to monitor and predict the environment. 

Business and marketing teams must stay nimble, accept changes quickly, and leverage their customer service and satisfaction strengths to maintain business success and a positive marketing environment. 

How to refine your marketing environments with Wrike

Wrike helps to define, monitor, and refine your marketing environments in the following ways: 

• Providing a central platform for communications between team members
• Maintaining marketing management workflows
• Extracting reports and analysis on past campaign performances and employee productivity
• Providing a birds-eye view that helps review and forecast possible changes in the marketing environment

Are you ready to take control of your business's marketing environments for the best results? Get started with a two-week free trial of Wrike's marketing management software today.

Why is it necessary for a marketer to study the marketing environment?

How can a marketer respond to the changing marketing environment?

Why the company needs to respond to the marketing environment changes?