Understanding Marketing Environment: Importance, Analysis and Strategies

Marketing Principles 1
Introduction
A business venture cannot survive on a standalone basis. There are various factor within the
business’s environment that significantly impact the business. Marketing environment must be
identified, analyzed and improved in order to ensure continued business success. Businesses are
impacted by micro environment existing within the business as well as macro environment
outside the business (West et. al., 2015). A business has no control over its macro environment
but this environment continues to impact the business. Through this course, we gained a deep
insight about the importance of understanding business environment and the strategies that
businesses adopt in order to do the same.
Marketing environment
Every business has its own marketing environment that has an impact on the business. Efforts
must be put by the organizations to understand that environment and ensure a positive impact of
the same. For example a start-up based on Australia is impacted by the political, economic or
technological aspect of country. India recently abolished its previous tax system and introduced a
single GST (Goods and services tax). This move had a massive impact on all businesses across
various industries. The prices of almost every product were altered.

Marketing Principles 2
Source: 1 India Today
Importance of environmental analysis
Understanding business environment is essential for the business to survive the competition that
exists and understand consumer needs better. Environment analysis is done by breaking the
market environment into smaller parts and gaining a deeper insight about the same (Proctor,
2014). The environment that the organization can directly control is the internal environment.
Internal environment analysis helps in understanding if the business stakeholders are satisfied
with the business and ensure their long term retention. Analysis of external environment helps in
identifying competitors and gaining a deeper insight about the changing needs and demands of
the target market (Ingram et. al., 2015). For example an Ecommerce retailer would have to
understand the products sold by other retailers like Amazon Inc., their target market and the
prices quoted by them. If this retailer expands its operations to the United States then an
environment analysis will be done to understand the needs and demands of customers in the US
as well as the legalities of the country to avoid discrepancies.