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Chapter 4 E-environment 193

Introduction

In Chapter 2 we introduced the importance of monitoring changes in the environment and
how they impact on an organization. Table 4.1 presents the main marketplace or macro-
environmental factors and the micro-environmental factors that directly affect an organization.

Table 4.1 Factors in the macro- and micro-environment of an organization

Macro-environment Micro-environment (e-marketplace)

Social The organization
Legal, ethical and taxation Its customers
Economic Its suppliers
Political Its competitors
Technological Intermediaries
Competitive The public at large

In this chapter we concentrate on the role of the macro-environmental forces. Aspects of the
micro-environment or e-marketplace such as competitors, suppliers and intermediaries are the
focus of Chapters 2 and 4 and Part 2 of this book. We will review the macro-environmental
factor using the widely used SLEPT framework. SLEPT stands for Social, Legal, Economic, Polit-
ical and Technological factors. Often, these factors are known as the PEST factors, but we use
SLEPT since it is useful to stress the importance of the law in influencing Internet marketing
practices. The SLEPT factors are:
Social factors – these include the influence of consumer perceptions in determining usage
of the Internet for different activities.
Legal and ethical factors – determine the method by which products can be promoted and sold
online. Governments, on behalf of society, seek to safeguard individuals’ rights to privacy.
Economic factors – variations in the economic performance in different countries and

regions affect spending patterns and international trade.
Political – national governments and transnational organizations have an important role
in determining the future adoption and control of the Internet and the rules by which it
is governed.
Technological factors – changes in technology offer new opportunities to the way products
can be marketed.
For each factor we look at new issues raised for managers responsible for e-commerce trad-
ing. For those actively involved in the implementation of e-business, and in particular
sell-side e-commerce, factors associated with buyer behaviour are also important when
implementing e-commerce. These are covered separately in the section The online buying
process (Chapter 9, p. 492).
Now complete Activity 4.1 to reflect on some of the macro-environmental factors that
have to be considered by the e-business manager.
The issues identified in Activity 4.1 and others such as economic and competitive pressures
tend to change rapidly, particularly dynamic factors associated with advances in technology.