Kingston University

MSc in International Business Management

THE MARKETING ENVIRONMENTAL FACTORS AND

AN ILLUSTRATIVE SAMPLE FOR THEIR IMPACTS
THAT BASED ON THE UK FRAGRANCES INDUSTRY

Submitted by: Maxie

Submission date: 27th Oct 2013

Lecturer: Hilary Wason

Word count: 888 words

ABSTRACT
Marketing is an indispensable factor for deciding the success of a business. Nonetheless, creating an
effective marketing strategy as well as a proper marketing decision has been influenced by many factors
and the greatest impacts are from the macro-environmental factors. The purpose of this essay assignment
is to introduce these factors briefly. Based on the basic model of the macro-environment factors as known
as PEST analysis system and an empirical example of the men’s fragrances industry in the UK, this
assignment will also indicate the importance and a sizeable influence of those above factors to the
marketing strategy and tactics of an organization, whether it is large or small.

This image for illustrative purposes only: Summer scents series - the seasonal new fragrance collection from
L’Oréal Luxury Products International (The Moodie Report, 2010)
THE MARKETING ENVIRONMENTAL FACTORS AND AN ILLUSTRATIVE SAMPLE FOR THEIR
IMPACTS THAT BASED ON THE UK FRAGRANCES INDUSTRY
One of the most prominent business issues was the debate about the influences of environmental factors
on marketing strategies of organisations (Morello, 2013). In fact, the formulation of the marketing decision
might be driven strongly by four basic external factors such as political, economic, social and technology
which also be known as the PEST analysis (Thakur, 2010) [See Figure 1]. The aim of this essay assignment is
to give a description about those factors in brief. Based on some correlative data as some businesslike
examples from the market of UK men’s perfume in the UK, it also points out how each environmental
factor has affected and changed the face of the marketing plans of the fragrances industry in particular or
businesses’ forms in general.

Figure 1. The model of PEST analysis (Beckmann, 2011)

Firstly, from the interpretations of a well-known website about marketing education, Marketingteacher
(2013) has described that environmental factors can be divided into three levels according to the internal
environment, the micro-environment and the macro-environment [see Figure 2]. The internal environment
refers to the small and controllable forces staying within the company; whereas the micro-environment
affects the organisation’s non-capacity to serve the customers. The macro-environment is the largest
environment and refers to all external and uncontrollable forces. Although it has been suggested that
macro-environment factors do not influence the marketing abilities directly, they affect the marketing
strategies of organisations unequivocally (Ebstudies, 2012). Thus, next paragraphs will give an insight view
about these issues based on some practical examples from men’s perfume industry in the UK.

Figure 2. Three levels of the marketing environmental factors and their components (Marketingteacher, 2013)

According to marketing report (Research and Market, 2013), it suggests that the market for men's perfume
strongly increased in the UK in 2013, accounting for 37.3% of the total market of men's toiletries. This
positive numbers were assessed from many changes in businesses' marketing tactics under the control of
environmental factors. To illustrate this, the first noticeable point is that the legal framework for the
cosmetics industry (EU Cosmestic Regulation) has fully implemented in Europe on July 2013. In addition,
one of the major policies is to consider the certain ingredients of all cosmetics' products, including men's
fragrances from all types of business throughout the nations of EU community. An example for this case is
that if the products contain nano-materials which are not on the ingredients list, the company must send a
detailed report to the European Commission about 6 months before launching merchandises to market.

The second point is the impact of economic factors. In 2009, Britain was declared out of the recession;
nonetheless, consumers still remained cautious in their spending. Part of the reason was mainly due to
inflation and rising unemployment in the UK; and consumers tended to switch to choose own-label items
rather than luxury branded products to reduce costs. It can be argued for this situation that some
companies would change their marketing strategy and approach by offering new products. One portion is
to catch customers’ changes but on the other hand, it is not to conflict with company’s traditional products.
As a result, the market shift increased the total consumption of cosmetic products including men's
fragrances. As can be seen from figure 3 below (ONS, 2013), total consumer reached £ 991.091bn,
accounting for 2.5 % of total expenditure in 2012.
 Figure 3. UK Expenditure on Personal Care Products and Total Expenditure at Current Prices (£m at rsp and %), over
the 5-year period to 2012 [ONS, 2013]

The social-cultural forces are also unavoidable factors for marketing strategies. In few years, the number of
single-men and men who are conscious about looking after their appearances are playing a major role in
the consumption of personal care products. Therefore, the company which promptly grasps this market
segment earned no less profitable. According to L'Oréal’s report (2010, p.7), in a collaboration with fashion
brand Diesel to create a men’s perfume series, their Only-the-brave has become a focal point in the
portfolio list of men and considered as the most successful men's fragrance model ever. Adding to this
point, figure 3 illustrates the percentage of single-men from aged 25 to 44 in 2011 almost doubled
compared with more than two decades ago (13% and 7% respectively). Furthermore, the distributors
realized a demand which arose in the consumers' heart about using products in ethical standard.
Consumers nowadays interest of choosing a product which has less damaging to the environment that
makes them feel comfortable while using. Figure 4 outlines more about the current consumption of ethical
personal care products in England in 2011.
 Figure 4. People Living Alone in Great Britain by Genre and Age (%), 1986/1987 and 2011 [ONS, 2013]

Figure 5. Ethical Consumerism on Cosmetics and Personal Products (£m), 2000 and 2010-2011 [The Co-operative
Group, 2012]

Finally, the influence of technological factors are known for the new innovative features of products, along
with the remarkable growth of social media and the Internet in recent years (e.g. Facebook, YouTube),
which are related to the most effective marketing tools ever. In other words, it is also a way of fragrance
companies to test new product ideas on market easily, support for their marketing campaigns largely.
Another noteworthy point is to need the different technologies of product line for men and women
because of the dissimilar basis in their biological mechanisms (Research and market, 2013).

Taking everything into consideration, although PEST analysis has some limitations (Thakur, 2010 &
Kolemuller, 2013), it is assessed as one of the best tools which used to analyse the influences of
environmental factors on marketing strategy of organisations. By using PEST frameworks in the UK
fragrances market (2013), this assignment might achieve its purpose to illustrate the sizeable impacts of
environmental factors on marketing tactics of business as how they avoid negative consequences to be
successful.
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