Blog 2a - The impact of the digital marketing environment on strategic decision making.

When we talk about the environment in marketing, we are talking about the internal and external factors that affect the way in which a business operates (Mittal, 2020). The marketing environment can be broken down into two sections, the micro-environment (internal) and the macro-environment (external) (Chaffey and Ellis-Chadwick, 2019). The micro-environment, which is commonly referred to as the operating environment, focuses on the immediate environment of the business (Chaffey and Ellis-Chadwick, 2019). It includes suppliers, intermediaries, competitors and customers (Chaffey and Ellis-Chadwick, 2019). These factors can be influenced and/or controlled by the organisation. The macro-environment includes factors of the external environment that are largely uncontrollable (Chaffey and Ellis-Chadwick, 2019). These include political, economic, social, technological, legal and environmental factors (Chaffey and Ellis-Chadwick, 2019). Take a look at the diagram below for a visual representation of the digital marketing environment:

Source: (Chaffey and Ellis-Chadwick, 2019: 50)

The digital marketing environment has significant impacts on the strategic decision making of a business. Strategic decision making in digital marketing refers to the process of making a decision that will help achieve the long term goals and objectives of a business (Gartenstein, 2019). In order to understand the impact of the digital marketing environment on a business's strategic decision making, we can discuss the micro-environment and the macro-environment together.

Since the early 1990’s, digital technology and the internet have become a major part of our everyday lives (Science and Technology Facilities Council, n.d.). Customers now expect information to be available at their fingertips, whenever they want it. This expectation has led them to want instant responses and actions from businesses, in relation to any suggestions, comments or complaints they may have. In addition to this, customers expect businesses to provide them with content that is tailored to their needs, wants and demands, and is provided to them frequently. For customers today, this means providing content that catches their attention immediately and is short, sharp and easy to consume at a glance. How successful a business is in interacting with its customers can now be measured using data analytics, which provides businesses with real-time information about customer interactions.

The digital environment is complex, with many different channels such as Facebook, Twitter and Instagram etc. It allows businesses to target infinite customer groups with tailored content. For example, different age groups, in different countries, with different socioeconomic status’. Together this creates a large number of possible ways to satisfy customers. A firm’s strategic decision making process needs to establish defined goals and objectives for multiple marketing strategies. They also need to be flexible, as some strategies may require adjusting to meet customer expectations. With more decisions to make, the increased requirement to be flexible and the expectations of customers to have instant feedback, firms will naturally need to invest in more marketing resources. This means that businesses will need to generate more revenue, making it even more important to have clear goals. With clear goals, businesses can maximise the impacts of using digital platforms and provide themselves with a competitive advantage.

References

Chaffey, D. and Ellis-Chadwick, F., 2019. Digital Marketing. 7th ed. Harlow: Pearson, pp.49-50.

Gartenstein, D., 2019. What Is Strategic Decision Making?. [online] Small Business - Chron.com. Available at: <https://smallbusiness.chron.com/strategic-decision-making-23782.html#:~:text=Strategic%20decision%2Dmaking%20is%20the,your%20operations%20clarity%20and%20consistency> [Accessed 20 August 2020].

Mittal, P., 2020. Marketing Environment: Meaning, Features Types And Importance. [online] Art of Marketing - Learn the Art of Marketing from the Experts!. Available at: <https://www.artofmarketing.org/marketing-environment-2/marketing-environment-meaning-features-types-and-importance/13541> [Accessed 20 August 2020].

Science and Technology Facilities Council, n.d. A Brief History Of The Digital Revolution. [online] Stfc.ukri.org. Available at: <https://stfc.ukri.org/files/digital-revolution-infographic/> [Accessed 20 August 2020].