Small Business Marketing Environments

Small business marketing environments affect the marketing mix and the way that you, as a small business owner and leader plan and implement marketing strategies and tactics.

Small business marketing environments include microenvironments that are basic and small scale, and macroenvironments that are large in scope or extent.

Microenvironments for small business marketing include:

• Internal small business marketing environments,
• Intermediate small business marketing environments, and
• External small business marketing environments.

Macroenvironments for small business marketing include:

• Demographic small business marketing environments,
• Economic small business marketing environments,
• Natural small business marketing environments, and
• Cultural small business marketing environments.

Microenvironments For Small Business Marketing

Internal Small Business Marketing Environments

Your Business As A Small Business Marketing Environment

If you own a small business, it will be easier for you to include all aspects of your business in your marketing plans than it is for larger companies with their turf wars and politics. Still it’s important to realize that your business and everyone involved in it, together create a small business marketing environment.

Often low-level employees can make good contributions to your marketing plans if you just ask their opinions. You should involve all employees and functions in at least your preliminary and final marketing discussions. But those that are most affected by your marketing plans should be involved throughout the market planning process.

For instance, you should include your accountant or bookkeeper when deciding how much to spend on your marketing. There is no need to plan a marketing campaign that you don’t have funds to implement.

Include at least the primary people from product development, production, and sales to assure that you have the benefit of their perspective as you plan your marketing. Including them from the beginning helps assure that they will support your marketing plans.

Vendors As A Small Business Marketing Environment

The companies that supply what you need to produce your product comprise another important small business marketing environment.

If they are large, and you are small, they will have all the power in your relationship.

If you buy supplies from a smaller vendor you are in a better position to get what you need out of the relationship, including supplies on credit. The power in the relationship is more balanced.

Either way, you need to know what to expect so you can plan your marketing accordingly. There is no need to market with the goal of selling 100,000 units per month if you can only get supplies to produce 50,000 units.

Intermediate Small Business Marketing Environments

Distributors As A Small Business Marketing Environment

The companies who deliver your product comprise another important small business marketing environment in which you need balance of power.

Trucking and warehousing businesses can either contribute to your business and marketing success or detract from that success. Besides distribution by itself being an important component of the marketing mix, the rates that distributors charge influence another important component, price. So before you can proceed with your marketing plan, you have to know what they will charge for distributing your product.

You also need to know what benefits they will provide. For instance will the trucking company deliver directly to retailers or to a warehouse where products are stored before being trucked to retailers. That extra step costs your business and will affect either your price or profit.

But how much product that you distribute and how much of that product your retailers sell influences whether or not this step is required. If you distribute more, you will save a little on trucking costs, but have to pay warehousing costs unless you have retailers who buy a truckload at a time.

Retailers As A Small Business Marketing Environment

The type of retailers that you use for your product and how well those retailers reach your target market also influences your marketing and comprise another important small business marketing environment.

Will your product only be sold by exclusive retailers who have high mark-ups that affect your price and reach? No matter how good your marketing, if customers can’t find your products, they can’t buy it. If they really want it and are willing to pay the higher price, they will make the effort to visit an exclusive retailer. If not, they won’t.

So you have to know in advance which retailers will commit to carry your product. That decision is yours in that you can ask only those that fit with your marketing plan. However, it’s also theirs because they don’t have to carry your product.

Getting shelf space is another form of power. Will you have that power or will your retailers? If you form a reciprocal relationship between your business and your retailers, that has an entirely different effect on your marketing than if the retailers have all the power because your business is small and you’re begging for shelf space.

External Small Business Marketing Environments

Competitors As A Small Business Marketing Environment

Your competitors also compose an important small business marketing environment, and most have a vested interest in your marketing failing.

Even if your product is the first to do what it does and to offer the benefits that it offers, your business has competitors. In this case, your competitors will be generic competitors because they don’t directly compete with your product, but they do compete for your potential customers’ money.

For example, suppose you actually invented a transporter. You know the machine on the star track television programs that convert the mass of a person into energy, transports it to another place, and then converts the energy back into mass so the person rematerializes. Nothing like that exists, but such a product would be very expensive so it would have to compete with other products that the customer could spend on that product.

Maybe you believe your best market for your transporter is the USA government. Then high-tech weapons and surveillance devices are likely products that the government may buy instead. Thus, those products compete with your transporter.

In addition, all transportation products are competitors. Maybe they will move a person slower, but they will also meet less resistance from people wanting to get from one place to another.

Your marketing has to consider both types of competitors, their strengths and weakness, their benefits for consumers and users, and their prices.

Publics As A Small Business Marketing Environment

Publics also contribute to your business success or failure, and thus provide another small business marketing environment to consider as you plan your marketing.

Your publics are all groups of people who either influence your business or are influenced by your business. This includes special interest groups, government regulators and legislators, everyone in the environments listed above and other people that you may never think of as being connected to your business and your marketing.

Yet sometimes your marketing and even your business has to change to accommodate your publics’ perspectives and positions. So it’s best to consider as many potential publics as possible when you plan your marketing.

The trick here is that you, as a small business owner, won’t choose your publics. Instead, groups of people will choose to be publics for your business. Sometimes they choose your business because you are doing something that they like and want to support, but more often they choose your business because you are doing something that they don’t like and want to stop.

In the first case, consider yourself and your business blessed because, if you keep their support, these publics can be great assets to your business. In the second case, you generally have to change your business to resolve the public’s concerns or its members will damage your business and sidetrack your marketing.

In either case, your marketing should consider publics. If a public is against your business, meet with its leaders, attempt to resolve their concerns, and build a more positive relationship with its members. If that doesn’t work, you can inoculate against their claims in your marketing.

If a public supports your business, build a relationship with them, find out what they believe you are doing well and include that in your marketing, perhaps with testimonials from the public’s members.

Customers As A Small Business Marketing Environment

Your customers represent another small business marketing environment because they are people and organizations that purchase your products and services for their use. They are your ultimate consumers.

Your customers may be individual people who buy a new book that you publish, or a factories that buy screws that you produce to use in ithe manufacture of appliances, or governments that buy a retirement plan that you broker.

Your customer type influences how you set up your business and market your product. They are the people and organizations that most small business people think of when they develop marketing campaigns.

However, because so many other small business marketing environments influence the marketing success or failure of your small business, customers must be considered in context with these other small business marketing environments.

Macroenvironment Small Business Marketing Environments

Demographics Small Business Marketing Environments

Demographics are facts about people such as age, gender, income level, type of occupation, etc. Changing demographics influence what people buy and why. Demographics provide another small business marketing environment.

For example, life stages are related to age. As people go through different stages in their lives, they have different tasks to complete. As a result, their values, concerns, attitudes, needs and wants change as they move from one life stage to another.

Demographers have used life stages since the 1970s as a way of learning about target markets and predicting their behaviors, including their buying behavior. However, in the last decade, new research has found that Westerners are now entering each life stage 10 to 15 years later than they did in the 1970s. Thus, life stages represent a changing environment that you need to monitor in order to market successfully, especially if your products are targeted to a specific age group.

Other demographics also change, for example, in the late twentieth century , many in the upper middle class moved upward into the lower upper class and acquired a taste for luxury products. During the recession of the early twenty-first century, most were knocked back down into the middle class. Yet, their taste for luxury products continues.

Some leaders of businesses producing luxury products recognized this change and created lower-scaled versions of their luxury products that the upper middle class can still afford. They created an entire new market for their businesses.

To learn more about using demographics in small business marketing, see http://strategicmarketsegmentation.com/blog

Economic Small Business Marketing Environments

As the example above demonstrates, economics change and, in turn change small business marketing environments.

Changes in income, in consumer spending patterns, in economic development and in technology all influence economic small business marketing environments.

Changes in income influence what people buy. For example, when the economy is bad, more people shop at discount stores, giving discount stores a market advantage. People get more price conscious so price plays a greater role in marketing decisions and messages.

Changes in consumer spending patterns relate more to what people buy than to the price that they are willing to pay. For instance, during the great depression in the USA, people struggled to feed and to meet basic survival needs for themselves and their families. During the late twentieth centrury, people bought luxury items that weren’t even dreamed of during the depression.

The same difference in spending patterns is now present between different nations. In many third-world nations, people still struggle to meet basic survival needs, while in developed nations these needs are taken for granted and require a small proportion of the average citizen’s income.

Technology has changed what people buy and the way they work. When I was in high school, only the largest governments and businesses had computers, and they had to house their huge computers in special temperature-controlled rooms. Now nearly everybody has at least one home computer on a desk, and most businesses have one on every desk.

Natural Small Business Marketing Environments

As natural resources get in short supply, the marketing environment changes. I can remember the first time that I drove into a station that was selling a gallon of gas for more $1.00. I drove right out to find a station where it cost less. I felt that the station was price gauging.

Now I’m tickled to find gas at less than $3.00 a gallon. As the supply has gotten more limited, gas, and everything that has to be transported, costs more.

If your business uses any natural resource to produce your product, you have to consider natural resources in your marketing. Even if your product requires no natural resources, you use natural resources somewhere between producing and selling it.

Not only do natural resources influence price, the green movement gives products made from renewable materials an edge in the marketplace.

Cultural Small Business Marketing Environments

As the world becomes smaller and people become more intermingled, culture plays a greater role in marketing and provides another important small business marketing environment.

Not only does culture provide many microenvironments, but the intermingling of cultures changes the small business marketing environment. For instance in the USA, immigrant cultures are no longer assimilated into the “American” culture. Instead the “American” culture incorporates the language, the music, the religions and other aspects from immigrant cultures.

This changing culture influences the products that people buy and the way that you, as a small business owner, have to market your products.

Conclusions About Small Business Marketing Environments

As a small business owner, you must consider many small business marketing environments in your marketing plans.

You should take a proactive approach to affect small business marketing environments, include those approaches in your business and marketing plans and in your marketing strategies and tactics.

Small business marketing environments are constantly changing. Thus, you must monitor these changes and pay attention to, and even predict, changes in small business marketing environments in your marketing plans.

You should prepare contingency marketing plans in order to be prepared for quick changes in these small business marketing environments.

For additional information on planning your small business marketing see the small business marketing marketplan and small business marketing: how to do it.

To read more about marketing by this aruthor see www.StrategicMarketSegmentation.com/blog

Copyright – Linda P. Morton – Best Books Plus, Inc. – 2008: Small Business Marketing Environments