A2 Influences on marketing activity
• Internal influences:
o cost of the campaign
o availability of finance
o expertise of staff
o size and culture of the business.
• External influences:
o social
o technological
o economic
o environmental
o political
o legal
o ethical.
You have been employed by a local business to design a marketing campaign for their new product/service.
What information would you need to know about the business and products/services they offer before starting to design their marketing campaign?
These are influences from within the business which will affect a businesses marketing strategy.
Cost of the campaign- Businesses can invest as much or as little in marketing as they want. Businesses would hope that the cost of the marketing activity would be repaid to the business through an increase in sales and therefore revenue/profit.
Availability of finance- Every business should allow sufficient cost within its budget for marketing. This will allow them to market their goods/services appropriately throughout the year. Business may be able to identify periods throughout the year when their cash flow (access to money) may be limited and should coordinate their marketing activity around this.
Expertise of staff- Successful marketing activities requires sufficiently skilled staff with the expertise to deliver the marketing strategy, for example logo design and strapline creation requires a specific skill set.
Size and culture of the business- The size and culture of a business will affect the marketing activities it pursues. Well established traditional small businesses like butchers and bakeries are more likely to make use of traditional marketing activities. They should also consider some of the potential benefits more modern marketing activities might bring.
How might factors outside of a businesses control affect it's marketing strategy?
How might the cost of living crisis have affected the marketing activities of businesses within the UK?
These are less controllable that internal influences as they are caused by external factors. Businesses should aim to assess risk and have contingency plans however they cannot prepare for every eventuality. The Covid Lockdowns of 2020 were a great example of an external influence. It is also worth remembering that these events also offer opportunities for some businesses. Many toy companies and home gym equipment retailers performed really well during Covid.
Social factors include lifestyles and behaviours of people who are your customers or potential customers. This may include people’s taste in fashion, food and diet choices and trends in going out to restaurants and cinemas. Health scares in the news can affect the sales of some food products and other products.
Technological factors Technological factors can influence marketing activity, not only in terms of how businesses market their services and products such as Ede and Ravenscroft but also the speed and extent to which marketing can become viral. Marketing activities can be instantly promoted globally through social media, or by pop ups when you go online. Before the internet, businesses mostly relied on newspaper adverts and knocking on doors (cold calling). Technological factors can have both positive and negative outcomes, such as the :
Extent of the global marketing reach
Ability to update or alter marketing materials quickly and with little expertise or specialist equipment required.
Opportunity to replicate what competitors are doing.
Economic factors If projected sales are not realised due to unsuccessful marketing then a business may have to reduce its costs in other ways such as reducing the workforce lick Rockwell Collins in late 2015. Most recently, projected sales have been affected by the recession as this has changed people's spending habits. This is further evidenced by the reported successes of pound shops and pawn brokers. This change in spending habits needs to be anticipated by marketers as it influences marketing activities- how much and what type is needed to attract purchasers. If a business advertises solely in cinemas and less people go to the cinemas then their adverts have reduced exposure.
Environmental Factors can have significant influence on marketing activity. For example, the travel industry has had to act rapidly at times such as the 2015 Paris bombings, the plane crash in Fox Glazier in New Zealand and volcanic activity in Equador. Each of these are desirable tourist destinations promoted for their beauty or culture. Some environmental factors can have a positive impact on developing existing or creating new business ideas such as conservation holidays.
Political factors Legislation such as that prohibiting advertising cigarettes. This has had an impact on manufacturers and suppliers, because they are not able to promote smoking at sports events such as Formula 1 and football matches, and has restricted advertising in television programmes and films. In order to market their offers during the recession, supermarkets Lidl, Aldi, Morrisons and Asda started promoting value products; whereas M&S and Waitrose put greater emphasis on quality, both of which have reported increased sales and improved market share.
Legal factors affect marketing activities- for example disallowing religous advertising such as the Lord's Prayer example in the early winter of 2015. Despite the efforts of the marketing specialists of JustPray.uk and the regulators such as the Cinema Advertising Authority, the advert will not be aired in public cinemas due to its religious status and potential breach of the 2010 Equality Act. Guidance on marketing and advertising law is available from the UK government website.
Ethical factors refer to the moral values and expectations of the community that a business operates in. This can have an impact on the way a business operates as people are increasingly expecting businesses to operate in an ethical manner and there is more attention being brought towards those businesses that don’t. Ethical expectations include fair treatment of staff, honest accounting and paying proper tax, consideration of the environment and fair treatment of suppliers. Marketing activities should be influenced by external ethical factors such as:
Usage and type of human images in any advertising
Not making invalid claims about value, quality and pricing
Not making promises which the product or service cannot deliver
Avoidance of breaches in legislation and regulations
Businesses which compromise ethical practices can damage their reputation and may never recover.
Why is it important for a business to consider both internal and external influences on marketing?
How might a business benefit from a good marketing campaign?
How might a business be negatively affected a bad marketing campaign?