The impact of the Digital Marketing Environment on Strategic Decision Making.

Welcome back! This week we are delving in a little deeper into the digital marketing world and analysing how the many elements within it's environment have an impact on a firm's strategic decision making process.

The role of a marketer has always been to build and promote brands, create demand, increase sales and attract loyal customers for their client. Whilst doing all of this is a big job on its own, today’s unpredictable and ever-changing environment, especially in the online world, means marketers must step up and fill the shoes of crucial new roles, strategists being one of the most important.

Strategic decision making involves decisions that are made throughout the process of strategy development for a business. From a digital marketing perspective, strategic decisions usually involve aligning marketing goals (such as engagement, sales etc.) with business and consumer strategies (Joshi and Gimenez, 2014). That brings us to this weeks blog topic,

How does the digital marketing environment impact a firm's strategic decision making?

I’m going to begin addressing this by lightly touching on the micro environment of digital marketing, followed by a deeper analysis of the macro environment and how they both influence strategic decision making.

(Image sourced from https://www.marketing91.com/what-is-micro-environment-in-business/)

“The micro-environment is known as the operating environment, and focuses on the players that shape the immediate training environment” (Chaffey and Chadwick, 2019). In the digital marketing world, “players” refers to consumers with wants and needs, intermediaries, suppliers and competitors.

(Image sourced from: https://businessjargons.com/micro-environment.html)

Having a thorough understanding of these players in the micro environment and their behaviours is crucial to be able to build a marketing strategy that is both relevant and effective to the brand.

The macro environment consists of all external and broader forces that affect a firm in the marketplace. These include political, environmental, social, technological, legal and economical aspects. Before I look at each of these aspects and the impact of their properties individually. Here’s a diagram that demonstrates the macro and micro environment of digital marketing together.

(Image sourced from Digital Marketing, 7th Edition. Chaffey & Chadwick, 2019).

Now, let’s take a closer look at the external factors of the digital marketing macro environment that impact strategic decision making.

Political: The political stance of a country largely dictates the strategy used by a firm when marketing digitally. For example, Facebook and Twitter have been banned in some countries such as North Korea and Vietnam. Therefore, firms have limited options for online advertising platforms in these areas, and will need to assess and consider other options available.

Economic: The economic environment your firm/ brand fits into also reflects into decision making strategies. For example, if the brand is positioned with aesthetics that appeal to teenagers, the decisions made for pricing strategies must align with the level of disposable income of that specific target market.

Social: The social environment strongly impacts decision making as it involves knowing all of the personal details about your target market including their religions, beliefs, social class, their internet access and usage habits, income etc. so that strategies can be adapted in order for the brand to offer inclusivity, providing something for everyone who may be interested.

Technological: The technological aspect in the digital marketing is relatively straight forward. Marketers need to consider and keep up to date with the digital platforms and technological devices that their advertisements & websites are being displayed on and have a strategy in place that makes the content accessible across all possible channels.

Legal (Ethical): Legal issues are concerned with privacy and personal information ownership. Privacy, accuracy, property, and accessibility must be carefully considered and assessed when marketing digitally.

Environmental: Last but not least we have the environmental factors. This is an element that is becoming progressively more important in digital marketing overtime, as the world is becoming more aware and educated on the impacts brands and products have on the environment. A firm will have to consider the following in their strategy: product size and packaging, sourcing and trading ethics and any environmental partnerships or programs that the brand can participate in.

(Story, 2020).

Having a deep understanding of these factors involved and adapting a strategy accordingly, is highly beneficial for marketing firms as it can create new markets and new opportunities.

That’s it from me this week, I hope you’ve learnt something from this blog post and are able to consider how these elements of the digital marketing environment can impact a firm’s strategic decision making. Applying this knowledge to your own practice will assist you to adapt new and suitable strategies when marketing for a client!

Thanks for tuning in! Talk to you on my next post,

Claudia.

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REFERENCES:

Chaffey, D & Ellis-Chadwick, F (2019) “Digital Marketing, 7th Edition” Pearson VitalBook file.

Joshi, A & Gimenez, E (2014) “Decision Driven Marketing” Harvard Business Review (online). Available at: https://hbr.org/2014/07/decision-driven-marketing#:~:text=Strategy%20and%20planning%20decisions%20involve,should%20we%20focus%20marketing%20support%3F (Accessed 20th August, 2020)

Story, J (2020) “Using the PESTLE Analysis Model” Smart Insights (online). Available at: https://www.smartinsights.com/marketing-planning/marketing-models/pestle-analysis-model/ (Accessed 20th August, 2020).