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Micro Environmental Factors

These are internal factors close to the company that have a direct impact on the organisations strategy. These factors include:

Customers

Organisations survive on the basis of meeting the needs,  wants and providing benefits for their customers. Failure to do so will result in a failed business strategy.

Employees

Employing the correct staff and keeping these staff motivated is an essential part of the strategic planning process of an organisation. Training and development plays an essential role particular in service sector marketing in-order to gain a  competitive edge.  This is clearly apparent in the airline industry.

Suppliers

Increase in raw material prices will have a knock on affect on the marketing mix strategy of an organisation. Prices may be forced up as a result. Closer supplier relationships is one way of ensuring competitive and quality products for an organisation. 

Shareholders

As organisation require greater inward investment for growtht hey face increasing pressure to move from private ownership to public.  However this movement unleashes the forces of shareholder pressure on the strategy of organisations. Satisfying shareholder needs may result in a change in tactics employed by an organisation. Many internet companies who share prices rocketed in 1999 and early 2000 have seen the share price tumble as they face pressures from shareholders to turn in a profit. In a market which has very quickly become overcrowded many will fall.

Media

Positive or adverse media attention on an organisations product or service can in some cases make or break an organisations.  In the UK the adverse publicity the Millennium Dome has received has had impact on projected sales figures. Wharfedale who recently entered the DVD market has received many award from industry magazine resulting in an increased demand for this product and  most importantly an increased awareness of the Wharfedale brand.

Consumer programmes on TV like the BBC's Watchdog with a wider and more direct audience can also have a very powerful and positive impact,  forcing organisations to change their tactics.

Competitors

The name of the game in marketing is differentiation. What benefit can the organisation offer which is better then their competitors. Can they sustain this differentiation over a period of time from their competitors?. Competitor anlaysis and monitoring is crucial if an organisation is to maintain its position within the market. 

Recommended Books

Principles of Marketing by Philip Kotler

Principles of Marketing by Frances Brassington and Stephen Pettitt