CHAPTER 2ND

DYNAMIC MARKETING
ENVIRONMENT
 Meaning of Dynamic
 Dynamic
Dynamic is something which is ever
changing
OR
Dynamic means something which is
complex or difficult to understand.
Meaning of Environment
 Environment
Environment means surroundings.
The marketing environment consists
of factors that have a direct or
indirect impact on the organisational
operations.
 So we will see that what changes
have occurred in field of marketing
which has made it more complex to
understand, what factors affects our
marketing planning and how can we
understand all such factors which
are affecting our marketing
activities”
 Environmental Monitoring
 It also means environmental
scanning. It is the process in which
the marketer has to analyze the
internal and external environment of
an organization.

 We have two types of Environments

1 Internal Environment
2 External Environment
 Internal Environment
 It is the world inside the premises of
an organization.
Or
Internal Environment refers to the
environment inside the organization
boundaries. It includes building,
machineries, plant, employees etc
 External Environment
 External Environment is that which
lies outside the premises of the
organization, or it is the world
outside the gate of the organization.
It includes customers, government,
suppliers, technology etc
 Internal environmental factors are
directly controllable for the organization
but the external environmental factors
can not be controlled directly.
 For Example, if there is a strike inside
the organization, we can control it
directly, but if there is a strike on road,
declared by transporters or public we
can not control it directly, as
government has to control it.
 Environmental Monitoring

1 Gathering information about the

internal as well as the external
environment of an organization

2 To analyze the gathered information

3 To forecast the present and future

impacts of environmental factors on
marketing activities.
 FIRM VS INDUSTRY

 FIRM
Firm means a business organization
which is doing business for earning
profit, and is dealing in some
products or services, e.g, AZIZI
BANK, MTN, KARDAN, KFC etc
 INDUSTRY
It is the collection of firms operating in
similar products and services in a
particular market. MTN, Etisilat, Afghan
Beseem, represent telecommunication
Industry, Azizi Bank, Maiwand and
Ghazanfar Bank represent banking
industry, KFC, AFC, and chief represent
food industry here in Kabul
 Levels of External
Environment
 There are 2 levels of external forces:

1 Macro Influences

2 Micro Influences
MACRO INFLUENCES:
Macro means “large” and influences
means “effects” so macro influences
are those external factors which may
affect the whole “Industry” not only a
single firm.
For Example, Government Laws,
Economic Conditions, Technology etc
 MICRO INFLUENCES:
Micro means “small” so those
environmental factors which will not
affect the whole industry but a
single firm.
For example, if the people of Kabul
start liking KFC, so only the sale of
KFC will increase and vice versa
 Factors of External
Macro Environment
 Followings are the factors related to
the external macro environment of
any organization:
1 Demographics
2 Economic Condition
3 Social and Cultural Forces
4 Political and Legal Forces
5 Technology
1 Demographics
 The study of human population is
called Demography. And its statistical
representation is known as
demographics

1-Size 2-Location
3-Age 4-Gender
5-Income 6-Occupation
7-Education
2 Economic Conditions
 Economic Conditions of different
countries are different from each
other, depending upon their
employment rate and income level.
For example, people living in Europe
they have higher incomes and good
employment opportunities, that’s
why their life standard is also higher
than that of people living in Asia.
4 Social and Cultural
Forces
 Every society has got its own religion
and culture and the people living in
that society have a very strong belief
in it.
For example, we do have a concept
of Haram and Halal things in our
religion (Islam). Like eating pork or
drinking beer is Haram in Islam,
 Cont`d..
 So marketers has to take care of social
and cultural values of a market in
which he is operating.

 Another aspect is that, Muslims

celebrate Eid, Ramazan, and other
events, while Christians celebrate
Easter, Christmas, Good Friday etc
and Hindus celebrate Holi, Dewali,
etc.
5 Political And Legal
Forces
 Government of a country is Head of
a State. Government is there to
decide what activities are legal and
can be termed as business and what
activities can be said as crimes. So
all the businesses or industries have
to follow the government rules and
regulations they have to pay taxes
etc..
 Cont`d..
 For example in Kabul, if some one
wants to start a University, He/She
can not open it without the
permission of Ministry of Education.
Similarly, if some one wants to start
telecommunication business, then he
has to seek permission from
Telecommunication Ministry.
6 Technology
 Technology has got a bigger impact
on today`s modern business world.
Business has develop a lot due to
invention of Computerized
Technology, Air Industry, Robots,
Laptops, Television, Fax Machines
etc, which have contributed a lot in
making world “a global village”
 EXTERNAL MICRO
ENVIRONMENT
 It means an environment which lies
externally but will affect only a
single firm, it contains following
factors:
1 Firm`s Customers
 Every firm has got its own customers, if
majority of the customers feel that the
firm is fulfilling their needs and wants in a
better way, by producing the quality goods
and services, they would keep using the
products and services of that firm. Hence,
the demand of the product for that firm
will increase but not for the whole
industry. And if the customers are not
happy, similarly, only that firm will suffer.
2 Suppliers
 Suppliers are those persons or
organizations which are providing raw
materials to producers for making
products.
OR
 The people or firms that supply the goods
or services that an organization needs to
produce what it sells.
 e.g. a car making company needs to
purchase tyre, batteries and many other
parts from various other suppliers.
3 Wholesaler And Retailer
These are the companies which are
linking the producers with the customers.
Wholesaler gets products from producer
in larger quantities, and retailer gets
them in smaller quantities and they are
directly selling them to customers. So the
success of an individual firm depends on
the performance of their middlemen
performance. so it will affect the single
firm.
3 Competition
 Competition is also an Environmental
factor. Here we have competition in
telecommunication Industry. We have
Roshan, MTN, Etisilat and AWCC etc.
Now if Roshan decrease their rates,
so all other firms will be affected as
well. so we are affected by the actions
and reactions of our competitors and
we can also affect them as well.
 Internal Environment
 Internal environment is the world
which lies inside the premises of an
organization, and is always directly
controllable for the organization, it
includes employees or human
resources, technical resources,
financial resources, location,
building, and production facilities.
THANKS