Macro Environment: Political Influences
Politics always exert great influences on corporate marketing activities as all business activities happen within certain countries and regions and have to obey certain policies. Political environment mainly refers to the external political situations of corporate marketing activities. Political stability is expected to exert positive influences on the implementation of marketing mix as it protects and secures the business environment and thus people could live and work in peace and contentment (Constantinides 2006, 410). On the country, political instability incurs social contradictory intensified and disordered business environment. In an unstable marketing environment, prices are easier to get out of control and business activities are heavily damaged as well. As for external trade business and international marketing, it is especially worth concerning about the influences the possible influences that the host country’s political environment would bring to them. Political environment is one of the most fundamental factors that marketers should concern while implementing any forms of marketing mix as it is suggested as the most powerful uncontrollable factor in marketing activities.
From a broader perspective, political environment refers to a system of a nation’s ideology and the values highlighted by the dominance hierarchy. More specifically, it includes the political institution, policies as well as some laws and regulations. From a narrower perspective, political environment is then thought to be political resources, political models and political situations, etc. as for marketing mix, the political environment mainly refers to three dimensions: political situations, certain policies and the international relations.
Any policies that government has made, including population policies, energy policies, financial policies and monetary policies would influence the implementation of marketing mix. Domestic political factors like political system, political climate and specific policies are directing the ways in which marketing is heading to. For example, the government could boost consumption growth by cutting interest rate. Or, it imposes individual income tax in order to imbalance the income gap among customers and then influences their purchasing behaviors. In some cases, product taxes are also imposed on some special products like cigarette and wine in order to restrain demand. In international marketing activities, some countries are also using polices as weapons against marketing from foreign countries as well. Thus, the distribution in host country could be rather difficult. These policies may be import restriction, tax policy, price control, foreign exchange control and nationalization policy.
Therefore, when the political situation is stable, it is easier for the marketing environment to be protected and the orders to be kept. Marketing could benefit from political environment when policy is in marketers’ favor. When policy goes against marketers’ wills, the influences could be detrimental as well. Also, the political environment is even more complex and unpredictable for international marketers. Therefore, before implementing marketing mix, the marketers should first get a better understand of the political environment and then obey the rules other than challenging it.
Micro Environment: Customer and Clients
As the aim of marketing is meeting the needs of customers or clients, customer preferences and consumer behaviors are exerting inevitable influences on the implementation of marketing mix. First of all, customer preferences influence their choices in products. Rogers had classified customers into five types, ranging from the ambitious one to the conservative one. Accordingly, customers are labeled as innovate, curious, followers, cautious and conservative. Therefore, different types of customers have different reactions in accepting new products and marketers should take advantage of it and further develop their potential customers as well as establish their product loyalty.
Price is always the most sensitive factor that determines customers’ buying behaviors. Conversely, customers’ price sensitivity, purchasing power and individual income are all influencing the price strategies in marketing mix as well. Price consciousness is reflected in whether the customer is sensitive to the changes of prices. It is believed that a range of price fluctuation within which customers could accept. With the popularization or inflation, different customers would perform different reactions to the price increases, and the same situation goes for price decreases as well (Blois 1974, 140). From the stance of customers, their purchasing power or individual income plays an important role in buying behaviors. It is commonly believed that high-income individuals have higher-level demand and cares less about the expenses or the prices, vice versa.
Channel of distribution is determined by several factors, including purchasing volumes, consumer distribution, the number of potential customers and consumers’ buying habits. Therefore, while choosing distribution channels, marketers have to consider about their customers’ needs and expectations. Firstly, they should consider which place is more convenient for consumers to shop. Also, the places of choice must be well-recognized and be a proper place to establish the image of products. Before locating, the marketers should first make a prediction on where the target customers are more likely to appear as well (Wang et al 2000, 380). While more and more companies are choosing network store as one of their distribution channel, a research on online customers and online market should be conducted as well (Mosley-Matchett 1997, 25).
Promotion varies while target customers and clients differ. The major promotion types include advertisement, public relation and propaganda, direct marketing, sales promotion and personal promotion. Promotion behavior does not directly aim at selling products. In fact, the major function of promotion is to convey the message to customers and be persuasive and influential to the potential customers as well. Customers experience a series of mental activities before buying products: knowing, understanding, liking, preferring and establishing faith. Therefore, different customers in different levels should be treated differently.
Blois, K.J. 1974, ’The Marketing of Services: an Approach’, European Journal of Marketing, vol. 8, no. 2, pp. 137-145.
Constantinides, E. 2006, ‘The marketing mix revisited: towards the 21st century marketing’, Journal of Marketing Management, vol. 22, pp. 407-438.
Mosley-Matchett, J.D. 1997, ‘Include the Internet in Marketing Mix’, Marketing News, vol. 31, p. 25.
Wang, F., Head, M. & Archer, N. 2000, ‘A relationship –build model for the web retail market’, Internet Research: Electronic Networking Applications and Policy, vol. 10, no. 5, pp. 374-384.