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2.2 The environments

The marketing function is a subsystem within the organisation. This means that the external environment of the organisation will influence its activities. Table 2.1 provides an example from the political environment of various legislation affecting the marketing function.

It also means that the external environment of the marketing subsystem within the firm will have an influence on marketing activities, such as new human resource policies. The immediate external environment of the marketing subsystem in the firm is the internal environment of the firm itself.

Hence we talk about the internal and external environments of an organisation and how they affect its marketing activities. Turn now to the following reading for an introduction to the marketing environment and a discussion of the actors and publics involved within this environment.

In your text

Kotler et al. (2004) Chapter 5, pp. 162-168, 'The global marketing environment' and 'The marketing organisation's micro-environment'.

Table 2.1 Summary of selected major legislation affecting marketing

Designed primarily to regulate competition

  1. Trade Practices Act 1974 (Cth) Part IV, prohibits unfair competition.
  2. Trading Stamp Act 1974 (NSW), prohibits issue of three party trading stamps. Similar Acts in Victoria , South Australia , Tasmania and Western Australia .
  3. Lotteries and Art Unions Act 1901 (NSW), regulates lotteries, games of skill, gifts. Similar Acts in other states.
  4. Companies (NSW) Code 1981 s. 99, regulates advertising of prospectuses. Similar Acts in other states.
  5. Credit Act 1986 (NSW), regulates credit sales transactions.
  6. Sale of Goods Act 1923 (NSW) as amended, covers implied terms and conditions in consumer sales contracts.
  7. Copyright Amendment Bill (No. 1) 1977 (Cth) , modifies copyright protection on packaging and labeling when used as a trade barrier.

Designed primarily to protect consumers

  1. Trade Practices Act 1974 (Cth) , Part V, strengthens the position of consumers relative to producers and distributors.
  2. Broadcasting and Television Act 1994 (Cth) , sets advertising standards for broadcasting and television. Established Australian Broadcasting Tribunal.
  3. Racial Discrimination Act 1975 (Cth), renders unlawful acts of discrimination.
  4. Therapeutic Goods Act 1966 (Cth) , sets standards for goods for therapeutic uses and their distribution.
  5. Consumer Claims Tribunal Act 1974 (NSW) , adjudicates on small claims
  6. Door to Door Trading Act 1986 (Tas) , ensures written offers and establishes cooling off period.
  7. Weights and Measures Act 1915 (NSW) , regulates packaging and labelling.
  8. Selling Schemes (Elimination) Act 1993 (Qld) , prohibits pyramid selling.
  9. Fair Trading Act 1987 (NSW) and other states, extends the protection of the Trade Practices Act to cover the activities of individuals and intrastate trade.

Source: Miller and Layton (2000, p. 55)

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