Micro environmental factors are internal factors close to a business that have a direct impact on its strategy.

These factors include: Customers Organisations survive on the basis of meeting customer needs and wants and providing benefits for their customers. Failure to do so will result in a failed business strategy. mployees mploying the correct staff and !eeping staff motivated is an essential part of an organisation"s strategic planning process. Training and development play a critical role in achieving a competitive edge# especially in service sector mar!eting. This is clearly apparent in the airline industry$ where customer services is crucial in obtaining a competitive edge. %uppliers %uppliers provide businesses with the materials they need to carry out their business activities. & supplier"s behaviour will directly impact the business it supplies. For e'ample if a supplier provides a poor service this could increase timescales or lower product (uality. &n increase in raw material prices will affect an organisation"s mar!eting mi' strategy and may even force price increases. Close supplier relationships are an effective way to remain competitive and secure (uality products. %hareholders &s organisations re(uire inward investment to grow$ they may decide to move from private to public ownership and list on the stoc! mar!et. The introduction of public shareholders brings new pressures as public shareholders want a return from the money they have invested

in the company. %hareholder pressure to increase profits will affect organisational strategy. )elationships with shareholders need to be managed carefully as rapid short term increases in profit could detrimentally affect the long term success of the business. Media *ositive media attention can ma!e an organisation +or its products, and negative media attention can brea! an organisation. Organisations need to mange the media so that the media help promote the positive things about the organisation and conversely reduce the impact of a negative event on their reputation. %ome organisations will even employ public relations +*), consultants or gurus to help them manage a particular event or incident. Consumer television programmes with a wide and more direct audience can also have a very powerful impact on the success of an organisation. %ome businesses recognise this and will change their reaction when consumers mention that they are going to contact a consumer television programme or the newspapers about the business. Competitors The name of the game in mar!eting is differentiation. Can the organisation offer benefits that are better than those offered by competitors- .oes the business have a uni(ue selling point +/%*,Competitor analysis and monitoring is crucial if an organisation is to maintain or improve its position within the mar!et. 0f a business is unaware of its competitor"s activities they will find it very difficult to beat them. The mar!et can move very (uic!ly whether that is a change in trading conditions$ consumer behaviour or technological developments. &s a business it is important to e'amine competitors"

responses to these changes so that you can ma'imise the impact of your response.

Macro1environment
.iscuss the following areas of the so1called marco1 environment: sa. competitive nvironment b. .emographic nvironment c. conomic nvironment d. 2atural nvironment e. Technological nvironment f. *olitical nvironment a. Competitive nvironment:includes institutions and other forces that affect the basic values$ behaviors$ and preferences of the society1all of which have an effect on consumer mar!eting decisions. b. .emographic nvironment: includes the study of human populations in terms of si3e$ density$ location$ age$ se'$ race$ occupation$ and other statistical information c. conomic nvironment: consists of all factors1such as salary levels$ credit trends$ and pricing patterns1that affect consumer spending habits and purchasing power. d. 2atural nvironment: involves all the natural resources$ such as raw materials or energy sources$ needed by or affected by mar!eters and mar!eting activities. e. Technological nvironment: consists of those forces that

affect the technology and which can create new products$ new mar!ets$ and new mar!eting opportunities. f. *olitical nvironment: includes all laws$ government agencies$ and lobbying groups that influence or restrict individuals or organi3ations in the society