There are five environmental factors that influence the marketing decisions and activities i.e, Technology, Demographics, Government, Social and Economic. Technology What is the impact of Technology? Technology has created a major impact on the way in which all organizations market their products and services. With the development of the internet, companies are now able to economically market themselves on a global level. Even smaller companies that were once not able to capture international business due to the cost factor can now do just that. The companies' website, which gives detailed information about the their services, can be accessed by potential customers all over the world. Technology is vital for competitive advantage, and is a major driver of globalization, the following are the consideration: • Does technology allow for products and services to be made more cheaply and to better standard or quality? • Do the technologies offer consumers and business more innovative products and services such as internet banking, new generation mobile telephone, etc? • How is distribution changed by new technologies e.g books via the Internet, flight tickets, etc? • Does technology offer the Hotels a new way to communicate with consumers e.g. Banners, customer Relationship Management (CRM), etc? Demographics Demography is the research of gender, age, race or anything else related to consumers. International businesses are concerned about various races (Asians, Hispanics, etc) and their different set of demands. While the terms like "baby boomers" or "generation X & y" were invented to reflect the specific age groups of consumers. Sociocultural Factors The social and cultural influences on business vary from country to country. It is very important that such factors are considered, these factors include: • What is the dominant religion? • What are attitudes to foreign products and services? • Does language impact upon the diffusion of products onto markets? • How much time do consumers have for leisure? • What are the roles of men and women within society? • How long are the population living? Are the older generations wealthy? • Do the population have a strong/weak opinion on green issues? Political The political arena has a huge influence upon the companies regulation businesses, and the spending power of consumers and other businesses. The following are the issues to be considered: • How stable is the political environment? • Will government policy influence laws that regulate or tax to the company? • What is the government’s position on marketing ethics? • What is the government’s policy on the economy? • Does the government have a view on culture and religion? • Is the government involved in trading agreements such as European or Asian Countries? Economic All the variables of economic markets like inflation, rate of exchange, fiscal policies and monetary policies fall under macro environment factors. They affect all businesses, and needless to say their marketing efforts as well. We need to consider the state of trading economy in the short and long-terms. This especially true when planning for either international or local marketing, we need to look at: • Interest rates • The level of inflation employment level per capita • Long –term prospects for the economy gross domestic product (GDP) per capita
