Customer Relationship Management Marketing Macro Environment Economics Essay

Customer Relationship counselling Marketing Macro Environment Economics EssayA line of military control line and its forces in its micro milieu ope lay out in larger macro surroundings of forces that shape opportunities and stick threats to the business. It refers the major external and unman periodable figures that influence an organizations decision making, and adjoin its performance and strategies.This involves factors outside of the direct control of the business. These macro-factors such as the economy, political relation policy and social spay tin can hire a significant operation on a slosheds success but the relationship is f demarcationly one trend. A change in the exchange rate can affect the ability of a firm to sell abroad for example, the pound rose in value to nearly 2 dollars in 2007 making UK exports pricey in America or Chinese regimen support on continued devaluation of their Yuan currency made them penetrate and sell more than and cheaper in worl dwide trade. The increasing interest in healthy eating has boosted organic sales. The ageing commonwealth in some economies has increased requirement for healthc atomic number 18 resources. However, whilst these macro factors can fundamentally change the environment of an organization one individual business can r atomic number 18ly do some(prenominal) on its avouch to shape them.Any one firm is unlikely to be able to influence political sympathies revenue enhancement policy or raw legislation, for example. The macro-environment can be synopsis using PESTEL analysis which is outlined below.PESTEL analysis of the macro-environmentThere are many factors in the macro-environment that exit affect the decisions of the managers of any organization. Tax changes, new laws, stack barriers, demographic change and government policy changes are all examples of macro change. To help analyse these we managers can categorize them using the PESTEL model. This classification distinguishe s betweenA political Factors Political and Governmental Environment These refer to government policy such as the degree of intervention in the economy. What goods and services does a government fatality to provide? To what extent does it believe in subsidising firms? What are its priorities in terms of business support? Political decisions can tinge on many vital areas for business such as the education of the workforce, the health of the nation, international business and the quality of the infrastructure of the economy such as the road and rail formation as few examples of areas affected.Political factors often impact on business of every type and size of it Some examples are the worldwide movement towards privatization of former government-owned utilities and businesses and the shift away from cling toion of workers rights. Firms need to be able to respond to the prevailing political climate and adjust the marketing policy accordingly. For example, British telecommunicatio n, Deutsche Telekom and Telstra of Australia get under ones skin all had to make major readjustments to their marketing approaches since being privatized, and in ill-tempered since seeing an upswing in warring trains. Almost all the firms activities hasten been affected, from cutting the lead time between ordering and obtaining a new telephone, through to price competition in response to competitors cut-price long-distance and international calls. British Telecom was the UKs fifth biggest spender on advertising during 2003The political Factors includes laws, government agencies, and bosom groups that influence and limit respective(a) organizations and individuals in a given decree. Various forms of legislation regulate business.1). Governments develop public policy to overtake commerce, sets of laws and regulations limiting business for the good of society as a whole.2). Almost every marketing use is subject to a wide range of laws and regulations. Some trends in the polit ical environment include change magnitude legislation toa). Protect companies from each other.b). Protecting consumers from unfair business practices.c). Protecting interests of society against unrestrained business behavior.Changing government agency enforcement. New laws and their enforcement leave alone continue or increase.Increased emphasis on ethics and socially responsible actions. fondly responsible firms actively seek out ways to protect the long-run interests of their consumers and the environment.a). Enlightened companies encourage their managers to look beyond regulation and do the right thing.b). Recent scandals have increased concern about ethics and social responsibility.c). The boom in e-commerce and Internet marketing has created a new set of social and ethical issues. Concerns are Privacy, Security, Access by vulnerable or unauthorised groups.B Economic factors These include interest rates, tax income changes, economical growth, inflation and exchange rates .It encompass such areas as the boom/bust cycle, and the growth in unemployment in some parts of the country as a result of the closing of traditional industries. Macro-economic factors deal with the management of demand in the economy the classic mechanisms governments use for this are interest rate controls, taxation policy and government expenditure. If the government increases expenditure (or reduces taxation), on that point will be more money in the economy and demand will rise if taxation is increased (or expenditure cut), on that point will be less money for consumers to spend, so demand will shrink. Rises in interest rates tend to reduce demand, as home loans become more expensive and credit card charges rise.Economic environment of business has reference to the board characteristics of the economic system in which the business operates. The business sector has economic relation with the government, capital market household sector and orbicular sector. These sectors togethe r influence the trends and structure of the economy. The form and functioning of the economy vary widely.The importance external factors that affect the economic environment of a business are(i) Economic Conditions The widely distributed Economic conditions prevailing in the country viz. national income, per capita income, economic resources, distribution of income and assets, economic development etcetera are important determinants of the business strategies.Business cycles and economic growth of the economy are important factors defining the economic environment.(ii) The economic system operating in the country also affects the business enterprise to a very big(p) extent. The economic system of a country may be capitalist, socialist, communist or intermingleed.(iii) Economic Policies The government decides the economic environment of business through Budges, industrial regulations, Economic planning, Import and Export regulations, Business laws, Industrial policy, Control on prices and wages, Trade and transport policies, the size of the national Income, Demand supply of various goods etc.(iv) Economic Growth The stage of economic growth of the economy has direct impact on the business strategies. Increased economic growth rate and increase in consumption expenditure, lower the general pressure at heart an industry and offers more opportunities then threats.(v) The rate of interest affects the demand for the products in the economy, particularly when general goods are to be purchased through borrowed finance. Low interest rated provides opportunities to the industries to expand whereas rising interest rates pose a threat to these institutions.(vi) Currency Exchange Current exchange rates have direct impact on the business environment. When the rupee was devalued in 1991, it was to make Indian products cheaper in the world market and consequently boost Indias exports.C Socio-cultural factors Socio-cultural factors are those areas that involve the sh ared beliefs and attitudes of the population. People learn to behave in particular ways as a result of feedback from the rest of society behaviour and attitudes that are regarded as opposed or rude are quickly modified, and also hatful develop expectations about how other people should behave.In the marketing context, people come to believe (for example) that shop assistants should be polite and helpful, that fastfood restaurants should be brilliantly lit and clean, that shops should have advertised items in stock. These beliefs are not laws of nature, but merely a consensus pick up of what should happen. There have certainly been many times (and many countries) where these standards have not applied. These prevailing beliefs and attitudes change over a period of time owing to changes in the world environment, changes in ethnic mix and changes in technology. These changes usually happen over fairly long periods of time. Since 1970 in most Western countries there has been a develo pment towards a more diverse, individualistic society a large increase in the number of couples living together without being married and a marked increase in the sufferance (and frequency)of single-parent families.Socio-cultural Environment Changes in social trends can impact on the demand for a firms products and the availability and willingness of individuals to work. Social class and caste of a person goes a long way in deciding the business activities in relation to its production and marketing activities. Tradition, customs and social attitudes have changed the attitude and beliefs of the persons which have their effect on organizational environment. Class and caste are influencing the purchasing pattern. Socio-cultural environment may include expectations of the society from business, attitudes of society towards business and its management, views towards achievement of work, views towards structure, responsibility and organizational positions, views towards customs, tradit ional and conventional, class structure and labour mobility and level of education.A very few cultural changes come about as the result of marketing activities a recent example in the UK is the gradual replacement of Guy Fawkes night as a family affair with Halloween, an American import which has children dressing up in costumes and going from house to house trick or treat-ing. In replacement of celebrations involve letting off fireworks, which is a dangerous activity for amateurs, but much of the change has been driven by a desire by marketers to sell costumes, and by the influx of US-made films and TV programs which show Halloween celebrationsD Technological factors Technological be ons in recent long time have been rapid, and have affected closely all areas of life. Whole new industries have appeared for example, satellite TV stations, cable networks, the Internet, CD recordings and virtual reality, and calculator- assisted design systems. All of these industries were un cope n even twenty years ago. It seems likely that technological change will continue to increase, and that more new industries will appear in future. The corollary, of course, is that some old industries will disappear, or at the very least will face competition from entirely unexpected directions. Identifying these trends in advance is extremely difficult, but not impossible.The macro-environment also contains the remainder of the organizations publicsGovernmental publics are the local, national and international agencies that characterise the gilds activities by passing legislation, setting interest rates, and fixing exchange rates. Governmental publics can be influenced by lobbying and by trade associations.Media publics Press, television, and radio services carry news, features and advertising that can aid the firms marketing, or conversely can damage a firms reputation. Public relations departments go to great lengths to ensure that positive images of the firm are conveyed to (a nd by) the media publics. For example, a company might issue a press release to publicise its sponsorship of a major sporting font. This could generate positive responses from the public, and a positive image of the company when the sporting event is broadcast.Citizen action publics are the pressure groups such as Greenpeace or consumers rights groups who lobby manufacturers and others in order to break life for the public at large. Some pressure groups are informally organised recent years have seen an upsurge in local pressure groups and protesters.New technologies create new products and new processes. MP3 players, computer games, online gambling and high definition TVs are all new markets created by technological advances. Online shopping, bar code and computer aided design are all improvements to the way we do business as a result of better technology. Technology can reduce costs, improve quality and lead to innovation. These developments can make headway consumers as well as the organisations providing the products.E Environmental factors Environmental factors have come to the forefront of thinking in the past fifteen years or so. The increasing scarcity of raw materials, the problems of disposing of waste materials, and the difficulty of decision appropriate locations for industrial complexes (particularly those with a major environmental impact) are all factors that are sternly modify the business decision-making framework. In a marketing context, firms are having to take account of public views on these issues and are often subjected to pressure from organized groups as well as individuals. Often the most effective way to deal with these issues is to begin by consulting the pressure groups concerned, so that disagreements can be resolved before the company has committed too many resources firms adopting the societal marketing concept would do this as a subject of course.Environmental factors include the weather and climate change. Changes in te mperature can impact on many industries including farming, tourism and insurance. With major climate changes occurring due to global warming and with greater environmental awareness this external factor is becoming a significant issue for firms to consider. The growing desire to protect the environment is having an impact on many industries such as the travel and transportation industries (for example, more taxes being placed on air travel and the success of hybrid cars) and the general move towards more environmentally friendly products and processes is affecting demand patterns and creating business opportunities.F Legal factors These are related to the legal environment in which firms operate. In recent years in the UK there have been many significant legal changes that have affected firms behaviour. The introduction of age discrimination and disability discrimination legislation, an increase in the minimum wage and greater requirements for firms to recycle are examples of relati vely recent laws that affect an organisations actions. Legal changes can affect a firms costs (e.g. if new systems and procedures have to be developed) and demand (e.g. if the law affects the likelihood of customers buying the good or using the service).Legal factors hound on from political factors, in that governments often pass laws which affect business. Sometimes judges decide cases in a way that re-interprets legislation, however, and this in itself can affect the business position. A further complication within Europe arises as a result of EU legislation, which takes precedence over national law, and which can seriously affect the way firms do business in Europe. Case law and EU law are not dependent on the politics of the national governments, and are therefore less easy to predict. all the way businesses must stay within the law, but it is increasingly difficult to be sure what the law says, and to know what changes in the law might be imminent.