Governmental Environment
Marketing decisions must be made with an understanding of how they are impacted by international, national, regional and local laws and regulations. For marketers, laws (i.e., acts past by governmental ruling bodies) and regulations (i.e., requirements put in place by governmental agencies) identify rules and procedures that guide certain marketing activities. Failure to conform to requirements established by the governments and their agencies may result in fines, sanctions or other legal action.
The governmental environment is a difficult external force to monitor for two key reasons. First, the number and variety of laws and regulations can be overwhelming even for the most seasoned marketer. For instance, in the U.S. alone there are potentially hundreds of laws and regulations that are either directly or indirectly targeted to marketing decisions. The table below provides a sampling of the issues covered by U.S. laws and regulations and the primary marketing decision areas these affect:
| Affected Decision Area | Coverage |
|---|---|
| General | unfair competition, restraint of trade, environmental |
| Target Market | discrimination, online registration, privacy |
| Product | product safety, labeling, intellectual property, warranties |
| Promotion | deceptive and misleading claims, advertising to children, telemarketing, email spam |
| Distribution | tying contracts, exclusive dealerships, transportation safety |
| Pricing | price discrimination, predatory pricing, consumer credit purchasing |
The second reason the governmental environment proves difficult is due to the complexity inherent in understanding laws and regulations which often makes it impossible for marketers to handle these issues on their own. Seeking legal assistance is necessary (and often costly) for most marketers no matter their size.