3 MacroMicroFactors Berlin

MACRO & MICRO ENVIRONMENT
Influence on Marketing Decisions
Learning Objective
I. Show macro and micro environmental factors which influence

marketing decisions.
2014 Berlin Asong. All rights reserved.
To achieve a pass in LO2.1, we must show macro and micro environmental

factors which influence marketing decisions.
To grasp the objective of this lesson, we need

to understand the scope of marketing decisions.
MARKETING
DECISIONS
Definition 1
Marketing decisions are those decisions

directed towards delivering value for the customer
in exchange for a return for the company.
Definition 2
Marketing decisions are choices made by

marketers with regards to how best to identify,
target, satisfy, retain and excite the customer.
10 minutes
List four decisions that you would

have to make to market J20.
Four Marketing Decisions for J20
From the preceding exercise, you begin to see the

scope of marketing decisions is vast, ranging from
10
deciding how to design and

package the product
Promotion
Product
Marketing
Mix
Price
Place
11
to providing answers to questions regarding
12
Marketing Decisions
Which market should we operate in?

How should we serve the chosen market?
How should we respond to changing market conditions?
Should we exit or enter the market?
Should we adopt the new technology?

Would the new offering increase sales?
Are we meeting the needs of customers?
Marketing Decisions
How should we improve our sales and profit?
13
Marketing decisions are influenced by a whole

range of factors, which is the basis of this lesson.
14
In our previous session, we discussed the steps
involved in marketing a product or service

Understand the
marketplace &
consumer
needs.
Decide on
suitable target
market(s).
Decide on
suitable
targeting
strategy.
Design suitable
marketing mix
strategy.
Implement
marketing mix
strategy.
Assess results
of marketing
mix strategy.
Adapted from Kotler, P. and Armstrong, G. (2012), Principles of Marketing. 14th edition, London: Prentice Hall, p. 5
15
Before setting out to market a product or service

successfully, understanding the marketplace is essential.
Understand the
marketplace &
consumer
needs.
Decide on
suitable target
market(s).
Decide on
suitable
targeting
strategy.
Design suitable
marketing mix
strategy.
Implement
marketing mix
strategy.
Assess results
of marketing
mix strategy.
16
In fact, understanding the marketplace involves
analysing macro and micro environment.

Understand the
marketplace &
consumer
needs.
Decide on
suitable target
market(s).
Decide on
suitable
targeting
strategy.
Design suitable
marketing mix
strategy.
Implement
marketing mix
strategy.
Assess results
of marketing
mix strategy.
17
I guess you are already asking yourself: what is

macro environment? What is micro environment?
18
MACRO
ENVIRONMENT
19
The macro environment consists of forces that

are beyond the control of a company. These forces
affect the companys ability to serve its customers.
Kotler, P. and Armstrong, G. (2012), Principles of Marketing. 14th edition, London: Prentice Hall, p. 66
20
Macro-Environment
21
Political Factors
Political (In)stability.
Governmental policies.
Change of governments.
Terrorism/War.
Etc.
22
Picture source: bankingtech.com
Political Stability
The UK is relatively attractive for businesses,

partly due to its stable, democratic governance.
23
However, tight fiscal policy (spending cut and

tax hike) continues to affect the spending power of
some segments of the alcohol beverage market.
Picture source: totallycoolpix.com
Government Policy
24
Economic Factors
Price inflation.
Unemployment level.
Size of consumer income.
Nature of market competition.
Overall economic condition of a country.
Fiscal & monetary policy.
Consumer confidence.
Exchange rates.
Interest rate
Etc.
25
Picture source: mppl.org
Employment Level
UK unemployment rate has fallen to 7.2% as of February 2014,

and is said to fall further in the next two years, raising the prospect
of increased consumer spending in the short term and long-term.
26
Exchange Rate Risk
Heineken operates in more than 50 countries.

Emerging markets currencies remain volatile. This is expected
to have an adverse impact on reported revenues.
27
Price Inflation
Rising cost of raw materials like barley and hops has an

adverse effect on Heinekens profit. The company uses
long-term and hedging contracts to manage costs down.
28
Monetary Policy: Interest Rate
UK bank rate stands at 0.5% aimed at making loans attractive for consumers
and businesses like Heineken to borrow and ramp up business activities.
29
Sociocultural Factors
Lifestyle.
Consumer activism.
Consumer preferences.
National culture and sub-cultures.
Population size , structure and growth.
Family size and marital status.
Public health concerns.
Religion.
Etc.
30
Population growth
The worlds population is growing, mortality rate is slowing, middle-class

segment is growing, and elderly segment is growing in some countries.
Picture source: byu.edu
31
15 minutes
Population changes have huge implications
on businesses. Critically explain how.
32
Culture
In what occasions is beer consumed in the UK? What values

or meanings do Brits attach to beer? Do these values or meanings
influence how Heineken markets its products in the UK?
33
Picture source: Heineken 2012
Heineken positions the brand in the minds of consumers

in a cultural context UK as a football loving nation -
34
Consumer Preferences
Heineken serves a variety of beer brands in different sizes
and forms to appeal to various consumer preferences.

35
In response to growing consumer preference for

healthy living, Heineken introduces low carb beer.
36
Technological Factors
Internet.
Cyber attack.
Technological infrastructure.
Smartphones and tablet devices.
Rapid technological change.
Mobile payment.
Social media.
Etc.
37
Internet
Picture source: global-discourse.com
Your business is probably losing out if you dont have a viable

online presence especially as online retail sales is accelerating.
38
Rapid Technological Change
The pace of technological innovation and obsolescence

is accelerating nowadays, changing the design, pricing, distribution,
promotion and buying of products and services.
39
Picture source: screenmediadaily.com
Location based mobile advertising

40
41
Picture source: Picture Source: screenmediadaily.com
Social Media
Online communities create and share messages about brands.

These messages influence consumer choices and preferences. As
a result, Heineken is using online platforms like Facebook, Twitter
and YouTube to engage with customers, & grow their brands.
42
43
Primark uses tweets to interact with

customers on new offers, and matters that
affect customers and society at large.
44
Ecological & Ethical Factors
Natural disasters (flood, drought, earthquake, hurricanes, tsunami, etc.).

Environmental consciousness.
Natural resources usage.
Environmental activism.
Etc.
45
Air pollution from

industrial waste like
carbon emissions.
46
Depletion of natural resources

stemming from excessive use.
47
Natural Resource Usage & Carbon Emissions
Heineken is cutting its water consumption in response to concern

and criticism over excessive used of water for beer production. It is
also cutting its carbon emissions through a number of initiatives.
48
Picture source: independent.co.uk
Ethics
Binge drinking and other

alcohol-related incidence
continue to generate negative
publicity for the alcohol
beverage industry.
49
Irresponsible drinking is bad for the health and contribute to

domestic violence and road accidents. Heineken together with other
civil society groups are leading a fight against alcohol misuse.
50
51
Heineken AD campaign against drink-driving.

52
Legal Factors
Consumer Protection Regulations 2008.

Competition Act 1998.
Data Protection Act 1998.
Intellectual property laws.
Health and Safety laws.
Advertising laws.
Other industry-specific laws.
53
For instance, UK advertising laws forbid

broadcast advertising for alcohol beverages
during programmes aimed at people under 18.
Picture source: huffpost.com
54
Picture source: huffpost.com
and ad should never glamorise alcohol beverages.

55
Picture source: forwallpaper.com
Of course, this fits in the category of glamorised

ad content, which the UK ASA would frown at.
56
Picture source: thedrum.com
Heineken ends its TV ad for Strongbow with

drinkaware.co.uk, an anti-alcohol abuse charity.
57
MICRO
ENVIRONMENT
58
The micro environment consists of actors close to

a company. These actors can negatively or positively affect
a companys ability to create value for its customers.
Kotler, P. and Armstrong, G. (2012), Principles of Marketing. 14th edition, London: Prentice Hall, p. 66
59
Micro-Environment
Consumers
Competitors
Suppliers
Organisation
Marketing
Intermediaries
Publics
Industry
60
Consumers
Consumer preferences, behaviour

and circumstances affect the marketing
decisions of goods and services. How?
Picture Source: www.execdecisions.net
61
McDonalds launches new

packaging with QR codes, which
provide nutritional info. to help health
conscious diners make informed
eating decisions.
Picture source: http://news.mcdonalds.com/press-releases/mcdonald-s-launches-new-global-packaging-designs-nyse-mcd-975617
62
Picture source: businessinsider.com
Rising Consumer Power
Todays consumers want to shop anywhere, anytime and anyhow. They are
more savvy and sophisticated than their counterparts 10 years ago thanks to the
increasing adoption rate of the internet, mobile devices and increased literacy.
63
Suppliers
64
As a marketer you want a capable and reliable

supplier to meet the needs of your marketing strategy aimed at
serving the customer and enabling your firm compete effectively.
65
Picture source: torontoisfashion.com
Primark competes on price to

appeal to low-income shoppers.
As a result, it sources garments
from low-cost suppliers in
Bangladesh, India, Indonesia, etc.
66
Ongoing court battle over patent infringements, and stiff competition

between Samsung and Apple has led the latter dropped the former as a major
supplier for some of the components used in making the iPad and iPhone.
67
Competitors
Your competitors are also vying for the same customers you
are after. How to beat your competitors to secure customer loyalty and
a larger share of the customer wallet requires smart and responsive
product/service design, pricing, distribution and promotion.
68
Consider the competition between ASDA, Aldi, Co-op, Lidl,

Iceland, Morrisons, Sainsburys, Tesco and Waitrose. In an effort to
gain the largest share of the customer wallet, all players are
constantly battling each other via price, quality, service, etc.
69
Marketing Intermediaries
They include wholesalers, retailers, service providers, etc.

Marketing intermediaries facilitate the movement
of goods and services from the manufacturer to the
customer through the provision of services such as
distribution, promotion, market research and financing.
70
Publics
These include communities, civil society groups,
investors, regulators, employees, media, etc.
71
It is increasingly being recognised that marketing must go beyond

serving the needs of the customer. It must appeal to a broader audience
including local communities, interest groups, etc. A marketing strategy that
does not consider the needs of other audiences is doomed to fail.
72
As a result, an increasingly number of companies are factoring

the considerations of various publics into their marketing strategies.
73
74
75
76
The Organisation
The objectives, capabilities, leadership, structure, culture and

strategy of an organisation influence its marketing decisions.
77
McDonalds (2013), "2013 Annual Report". Available from

www.aboutmcdonalds.com/content/dam/AboutMcDonalds/Investors/McDs2013AnnualReport.pdf, accessed 19 May 2014
78
The objectives and culture of McDonalds set the overall tone

and character of its marketing decisions. The services and products it
provides for customers are a direct result of its objectives and culture.
79
NEXT CLASS
Propose segmentation criteria to be
used for products in different markets.
80

3 MacroMicroFactors Berlin

Uploaded by

Copyright:

Available Formats

You might also like

3 MacroMicroFactors Berlin

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

3 MacroMicroFactors Berlin

Uploaded by

Copyright:

Available Formats

MACRO & MICRO ENVIRONMENT

Influence on Marketing Decisions

I. Show macro and micro environmental factors which influence

2014 Berlin Asong. All rights reserved.

To achieve a pass in LO2.1, we must show macro and micro environmental

2014 Berlin Asong. All rights reserved.

To grasp the objective of this lesson, we need

2014 Berlin Asong. All rights reserved.

2014 Berlin Asong. All rights reserved.

Marketing decisions are those decisions

2014 Berlin Asong. All rights reserved.

Marketing decisions are choices made by

2014 Berlin Asong. All rights reserved.

List four decisions that you would

2014 Berlin Asong. All rights reserved.

Four Marketing Decisions for J20

2014 Berlin Asong. All rights reserved.

From the preceding exercise, you begin to see the

2014 Berlin Asong. All rights reserved.

deciding how to design and

2014 Berlin Asong. All rights reserved.

to providing answers to questions regarding

2014 Berlin Asong. All rights reserved.

Which market should we operate in?

Should we adopt the new technology?

Are we meeting the needs of customers?

How should we improve our sales and profit?

Marketing decisions are influenced by a whole

2014 Berlin Asong. All rights reserved.

In our previous session, we discussed the steps

involved in marketing a product or service

2014 Berlin Asong. All rights reserved.

Before setting out to market a product or service

2014 Berlin Asong. All rights reserved.

In fact, understanding the marketplace involves

analysing macro and micro environment.

2014 Berlin Asong. All rights reserved.

I guess you are already asking yourself: what is

2014 Berlin Asong. All rights reserved.

The macro environment consists of forces that

2014 Berlin Asong. All rights reserved.

2014 Berlin Asong. All rights reserved.

Picture source: bankingtech.com

The UK is relatively attractive for businesses,

However, tight fiscal policy (spending cut and

Picture source: totallycoolpix.com

Picture source: mppl.org

UK unemployment rate has fallen to 7.2% as of February 2014,

Exchange Rate Risk

Heineken operates in more than 50 countries.

Rising cost of raw materials like barley and hops has an

Monetary Policy: Interest Rate

The worlds population is growing, mortality rate is slowing, middle-class

Picture source: byu.edu

2014 Berlin Asong. All rights reserved.

Population changes have huge implications

on businesses. Critically explain how.

2014 Berlin Asong. All rights reserved.

In what occasions is beer consumed in the UK? What values