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target customers before launching the product in the market. Such data is generated by conducting a market research study with adequate sample size, and the findings obtained are used to help decide whether the product is accepted and can be launched. Q.2 a. Examine how a firm‟s macro environment operates. b. Mention the key points in Psychoanalytic model of consumer behaviour. Ans. The term micro-environment denotes those elements over which the marketing firm has control or which it can use in order to gain information that will better help it in its marketing operations. In other words, these are elements that can be manipulated, or used to glean information, in order to provide fuller satisfaction to the company‘s customers. The objective of marketing philosophy is to make profits through satisfying customers. This is accomplished through the manipulation of the variables over which a company has control in such a way as to optimise this objective. The variables are what Neil Borden has termed ‗the marketing mix‘ which is a combination of all the ‗ingredients‘ in a ‗recipe‘ that is designed to prove most attractive to customers. In this case the ingredients are individual elements that marketing can manipulate into the most appropriate mix. E Jerome McCarthy further dubbed the variables that the company can control in order to reach its target market the ‗four Ps‘. Each of these is discussed in detail in later chapters, but a brief discussion now follows upon each of these elements of the marketing mix together with an explanation of how they fit into the overall notion of marketing. A scan of the external macro-environment in which the firm operates can be expressed in terms of the following factors:    

Political Economic Social Technological The acronym PEST (or sometimes rearranged as ―STEP‖) is used to describe a framework for the analysis of these macroenvironmental factors. A PEST analysis fits into an overall environmental scan as shown in the following diagram: Environmental Scan /


External Analysis / Macroenvironment

Internal Analysis

\ Microenvironment

| P.E.S.T. Political Factors Political factors include government regulations and legal issues and define both formal and informal rules under which the firm must operate. Some examples include:

Assignment (manish solanki)  
Assignment (manish solanki)  

MBA 2nd sem, assignment answers