Political-legal, technological, economical and socio-cultural factors dictate the marketing environment in the context of Nepal. They are both directly and indirectly linked to impact business decision and affect their marketing activities.
Looking at the political and legal aspect, the nation is undergoing a change in the process where the constitution is to be implemented and also with the formation of provinces and smaller bodies, the rules and regulations for administrative and legal aspects are going to change as well. The businesses need to adjust according to the change. With the current political dynamics after the recent merger of CPN-UML and CPN-Maoist to form a new party making them the largest party based on the won electoral votes in the Asia and third largest going by full strength in the same continent, they have got a significant grip on the policy-making and implementation. Several legal acts like the import-export act, company act, customs act and other are a subject of concerns to the manager. These policies influence the marketing directly or indirectly.
Technological development affects the way industries function and with the current age of technology, Nepal is advancing at a very rapid pace in this sector. As per the statistics of Nepal Telecom Authority (NTA), the internet penetration rate as of Kartik 2074 is nearly 63% in Nepal. This is a lot higher considering Nepal being an underdeveloped nation and many of its population aren’t literate. The e-commerce businesses are getting noticed very much as well due to the changing scenario and many businesses are building their online brand. Not only that the businesses are using all the other means of technology to get the most out of the situation and reach to their target audience.
The economic environment of Nepal is another element contributing to marketing environment in Nepal. In a nation with a favorable economic environment, business organization can have more opportunities while they may face different challenges if it’s not really well. Nepal is considered to be an agricultural nation with most of the population involved in this sector, however, the highest income comes from other industries like the service-oriented such as tourism and banking sectors to name a few. Also, remittance is another strong source of GDP in the nation. Nepalese nowadays are more inclined towards investing their money in stock market, land, gold, and home instead of investing in the foundation of a business and industry. So, a lot of effort needs to be made to improve the current situation.
Population, lifestyle, religion, education, language and several other factors form the socio-cultural environment. As per the Central Bureau of Statistics (CBS), the total population of Nepal stands just under 24.5 million with the population of female nearly 800 thousand more than that of the male. The population of working age has increased to 57% with over 15 million people falling under this category. Religion is another factor contributing to it with most of the population following Hinduism. The nation also saw a rise in the literacy rate which currently stands at 65.9% as per the CBS report. National language practiced is Nepali but with the latest constitution, several other languages have got an entry point and recognized as provincial languages. These all require businesses to make an adjustment in their marketing plan accordingly to target their customers (Central Bureau of Statistics, 2012).
Talking about the micro-elements of marketing, they’re those factors which can be influenced by the business. It includes customers, employees, competitors, media, shareholders, and suppliers (Evans, 1988). A business can influence customers by bringing out products that the customer wants or by aggressively targeting ads or with the use of some discount offer as such. An example of it can be by providing a 50% discount on a product the business sells. A business can also influence an employee by proving them with some bonuses or some added benefits like lunch, travel allowances and alike. Competitors can also be influenced by the business as the direction the business takes to bring the products out and the pricing it sets determines the actions that the other rival companies take. Moving on, media checks and balances the business and can be influenced by these businesses. It can be through the added treatment because they provided them with proper content or ads to run or being kind enough due to the business doing more of good to people. Stakeholders are another which the business can influence. Taking an example of Xiaomi, they’re targeting to attract ten billion dollars in funding and decided to not retain more than five percent of their profits from all but internet services sales (where there’s no barrier) just before the announcement of that they’ll be raising funds for stock. In all the documents, they do stress themselves to be internet company even though that contributes to very little of their profit or sells so they want to show their stakeholder that they’re an internet company and fully committed to that end to influence them to invest. Finally, suppliers are the ones that can be influenced as well as if the business provides them with proper care and continue to give a good number of orders, the supplier will always be committed fearing the company might move. So, a business can use the same to leverage lower cost of manufacturing and thus influence them as well.
References
Central Bureau of Statistics. (2012). National Population and Housing Census 2011 (National Report) (pp. 1-4). Kathmandu, Nepal: Government of Nepal.
Evans, M. (1988). Marketing Intelligence: Scanning the Marketing Environment. Marketing Intelligence & Planning , 6 (3), 21-29.
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Political-legal, technological, economical and socio-cultural factors dictate the marketing environment in the context of Nepal. They are both directly and indirectly linked to impact business decision and affect their marketing activities.
Looking at the political and legal aspect, the nation is undergoing a change in the process where the constitution is to be implemented and also with the formation of provinces and smaller bodies, the rules and regulations for administrative and legal aspects are going to change as well. The businesses need to adjust according to the change. With the current political dynamics after the recent merger of CPN-UML and CPN-Maoist to form a new party making them the largest party based on the won electoral votes in the Asia and third largest going by full strength in the same continent, they have got a significant grip on the policy-making and implementation. Several legal acts like the import-export act, company act, customs act and other are a subject of concerns to the manager. These policies influence the marketing directly or indirectly.
Technological development affects the way industries function and with the current age of technology, Nepal is advancing at a very rapid pace in this sector. As per the statistics of Nepal Telecom Authority (NTA), the internet penetration rate as of Kartik 2074 is nearly 63% in Nepal. This is a lot higher considering Nepal being an underdeveloped nation and many of its population aren’t literate. The e-commerce businesses are getting noticed very much as well due to the changing scenario and many businesses are building their online brand. Not only that the businesses are using all the other means of technology to get the most out of the situation and reach to their target audience.
The economic environment of Nepal is another element contributing to marketing environment in Nepal. In a nation with a favorable economic environment, business organization can have more opportunities while they may face different challenges if it’s not really well. Nepal is considered to be an agricultural nation with most of the population involved in this sector, however, the highest income comes from other industries like the service-oriented such as tourism and banking sectors to name a few. Also, remittance is another strong source of GDP in the nation. Nepalese nowadays are more inclined towards investing their money in stock market, land, gold, and home instead of investing in the foundation of a business and industry. So, a lot of effort needs to be made to improve the current situation.
Population, lifestyle, religion, education, language and several other factors form the socio-cultural environment. As per the Central Bureau of Statistics (CBS), the total population of Nepal stands just under 24.5 million with the population of female nearly 800 thousand more than that of the male. The population of working age has increased to 57% with over 15 million people falling under this category. Religion is another factor contributing to it with most of the population following Hinduism. The nation also saw a rise in the literacy rate which currently stands at 65.9% as per the CBS report. National language practiced is Nepali but with the latest constitution, several other languages have got an entry point and recognized as provincial languages. These all require businesses to make an adjustment in their marketing plan accordingly to target their customers (Central Bureau of Statistics, 2012).
Talking about the micro-elements of marketing, they’re those factors which can be influenced by the business. It includes customers, employees, competitors, media, shareholders, and suppliers (Evans, 1988). A business can influence customers by bringing out products that the customer wants or by aggressively targeting ads or with the use of some discount offer as such. An example of it can be by providing a 50% discount on a product the business sells. A business can also influence an employee by proving them with some bonuses or some added benefits like lunch, travel allowances and alike. Competitors can also be influenced by the business as the direction the business takes to bring the products out and the pricing it sets determines the actions that the other rival companies take. Moving on, media checks and balances the business and can be influenced by these businesses. It can be through the added treatment because they provided them with proper content or ads to run or being kind enough due to the business doing more of good to people. Stakeholders are another which the business can influence. Taking an example of Xiaomi, they’re targeting to attract ten billion dollars in funding and decided to not retain more than five percent of their profits from all but internet services sales (where there’s no barrier) just before the announcement of that they’ll be raising funds for stock. In all the documents, they do stress themselves to be internet company even though that contributes to very little of their profit or sells so they want to show their stakeholder that they’re an internet company and fully committed to that end to influence them to invest. Finally, suppliers are the ones that can be influenced as well as if the business provides them with proper care and continue to give a good number of orders, the supplier will always be committed fearing the company might move. So, a business can use the same to leverage lower cost of manufacturing and thus influence them as well.
References
Central Bureau of Statistics. (2012). National Population and Housing Census 2011 (National Report) (pp. 1-4). Kathmandu, Nepal: Government of Nepal.
Evans, M. (1988). Marketing Intelligence: Scanning the Marketing Environment. Marketing Intelligence & Planning , 6 (3), 21-29.