Macroenvironmental Impact on the Company Product Sales - Essay Example

This is because they affect the sales of an item or service in one way or the other. Therefore, before Monster Corp launches Monster Gum in the market, it is imperative that it carries out an analysis on the impacts of microenvioronment on the sales of its product. The objective of this paper is to explore the microenviornmental components; demographic, environmental, economic and cultural factors will likely impact on the sales of “Monster Gum.” Demographics One area of particular interest with regard to market analysis is the demographics.

This is refers to population trend study such as population size and movement; birth and death rates; gender, age and ethnic origin (Elearn 85). All these components that make up demographics will affect Monster Corp’s sales of the monster gum. For instance, the company is mainly targeting a specific age group in the society which is 18 to 30 years. This implies that as these group ages out, the sales of the product will likely reduce. In fact, it means that, in case this population age group is faced out, then the company will likely face a closure since the target age group will no longer be there to sell to.

On the other hand, the company would likely to gain in areas with high population size of the age group that is targeted. Environment Environment in this case is described as macro and community level factors such as legal, physical, and policy factors that influence individuals and household decisions. Environment influences diet in many households (Hitchner 89). The impacts of caffeine on differ from one individual to the next. Therefore, so people would only prefer products that have no caffeine in them thus affecting the sales.

On the other hand, health issues have become a major area of concern as many people become so sensitive to the diets. As a result, some individuals perceive caffeine to pose serious health issue and would, therefore, not want to consume. This affects the sales of the product. Legal issue such as government policies may also affect the sale of the product. This can either be negative or positive. For instance, government assistance in the form of subsidies and loans may fledge the company grow and help it keep its costs low for customers.

This will result to an increased sale of the product (Ginter and Duncan 96). However, the impact may also be negative in a situation where it imposes a regulation that increases costs. This will make the company adjust its prices up making the product expensive. This in turn, will scare away consumers who will find it better look for other substitutes that are cheaper thus, affecting the sales of monster gum. Economic Factors There are a number of economic factors that may impact on the company’s product sales.

For instance, the growth of a country, unemployment, and the capacity to get funding are all economic factors, just as the exchange rates, interest rates, inflation and per capita income (Gimbert 51). These factors usually exist in the day-today operation of a company or business. For instance, the existence of high unemployment rate in a country will affect the purchasing power of individuals thus leading to a decreased sale of monster gum. High inflation and interest rates of in an economy will make Monster Corp adjust to the economic situation.

However, the increase in prices due to increase in inflation and int