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Marketing Basics - Kotler Philip

The main factors of the microenvironment of the company

The main goal of any company? making profits. The main objective of a marketing management system ? ensure the production of goods attractive in terms of target markets. However, the success of marketing management depends on the activities of the remaining divisions of the company, and on the actions of its intermediaries, competitors and various contact audiences. The forces acting within the microenvironment of the company are presented in Fig. 22.

Marketing managers cannot focus solely on the needs of the target market. They must take into account all factors of the microenvironment. We will deal with these forces, illustrating their role and influence on the example of the Chicago-based Schwynn Bicycle Company, one of the largest bicycle manufacturers in the United States.

Firm

When developing marketing plans, the managers of the Shvinn marketing service should take into account the interests of other groups within the company itself, such as top management, financial service, R&D service, logistics service, production and accounting. For developers of marketing plans, all these groups make up the microenvironment of the company (see. Fig. 23).

The main forces acting in the microenvironment of the company

Fig. 22. The main forces acting in the microenvironment of the company

Microenvironment of the company

Fig. 23. The microenvironment of the company

At Schwinn, senior management includes the general manager of the bicycle manufacturing department, members of the executive committee, managing director, chairman and members of the board of directors. This top echelon of leadership defines the goals of the company, its overall strategic objectives and current policies.

Marketing managers must make decisions that are consistent with senior management plans. Moreover, all of their marketing projects are subject to approval by senior management.

Marketing managers must work closely with other parts of the firm. The financial service is concerned about the problems of having and using the funds necessary to implement marketing plans. The R&D service deals with the technical problems of constructing safe and beautiful bikes and the development of effective methods for their production. The logistics service takes care of the availability of a sufficient number of parts and assemblies for the production of bicycles. Production is responsible for producing the right amount of bikes. The accounting service monitors revenues and expenses, helping the marketing department to keep abreast of how successful the achievement of its goals is. The activities of all these units in one way or another affect both the plans and the actions of the marketing service.