Strategic Marketing Management
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Chapter 6 : Market and Environmental Analysis
The Nature and Structure of Marketing Environment
Structure of the Marketing Environment
Environmental Scanning and Analysis
Process of Environmental Scanning
Evolution of Environmental Scanning
Environmental Scanning Models
Pest Framework
Political (and Legal) Factors
Economic Factors
Social Factors
Technological Factors
Benefits of Environmental Scanning
Barriers to Effective Scanning
Chapter Summary
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Marketing is the process of identifying the changing requirements of
customers and providing them the right products and services in a way better
than the company's competitors. Knowledge of the environment in which it
operates helps a company to forecast the changing needs and preferences of
its customers. The marketing environment includes all the forces that
influence the marketing activities of a company. The marketing environment
can be broadly divided into micro, macro and internal environments.
Environmental scanning is the monitoring and communication of external
information within the company. The process of environmental scanning
includes five steps which are interdependent.
They are: the identification of the information needs of the organization,
collection of information, analysis of information, communication of
results, and decision making. |
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Information for environmental scanning can be obtained from both internal and
external sources like annual reports, journals, magazines, etc. Information
can also be collected through marketing intelligence and marketing research.
Marketing intelligence is the collection of information from unstructured
sources. Marketing research is a structured collection of information. There
are three models for environmental scanning – the irregular, regular and
continuous models.
The irregular model involves environmental scanning only when a crisis
arises. The regular model involves environmental scanning on a periodic
basis but it focuses on improving the present situation. The continuous
model involves the constant monitoring of environment to identify changes as
they arise. The PEST framework is commonly used for environmental scanning.
The PEST framework involves the analysis of the political, economic, social,
and technological environmental factors in a given market.
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Short Case Studies / Caselets