Telecommunication industry is one of the fastest growing industries in Australia; there have been

substantial changes in Telecommunication industry in Australia in the last 20 years. The

telecommunication industry is no more monopoly by the government. There is a very strong
competition in the industry among the industry giants such as Telstra, Optus, Vodafone and 3 Mobile.
Technical developments have brought increase in types of services offered, which includes telephone,
mobile, Internet, pay TV and much more. The Australian telecommunication market is fairly complex
because its characteristics. The important factors to be considered are its geographical size and multi-
cultural population. While deciding on the marketing analysis it is very important to consider the macro
environment factors of the marketing environment. A company-marketing environment consists of
persons and factors outside the marketing activity, which may affect the marketing strategies. The
components of the Macro environment work in an external environment that forms the opportunities
and threats for the organisation. The six factors are Demographic, Economic, Technological, Political
and cultural environment.

Demographic Environment – The study of Demographic environment consists of human population

in terms of age, sex, location, occupation, race and other differences. Demographic environment is very
important to design the marketing strategy, because this distinguishes the demands of the customers
according to the demographic factors. World’s population is now over 6.4 billion and is expected to be
more than 8 billion by 2028. The main growth is in countries like China, India and Brazil. Thus these
markets are being very popular for organisation outsourcing. Australia represents only half a percent of
the worlds population with 20.55 million and a rise if 1.2% per annum. Ageing population of Australia
is expected to be between 24.9 to 33.4 million by 2051, which includes the birth rate, overseas
migration, and deaths. Most of the telecommunication industries have started targeting the people with
age of over 60 years. As the need of people varies with the increase in age, telecommunication
companies need to customize their products accordingly for example giving pensioners discounts. The
changing family there is an increased trend of single parent house holds in Australia. In 2001, there
were less than 10% adults living alone. This figure has increased to more than 30% in 2004; the market
is increasing rapidly for telecommunication industry for the people living alone. As more people live
alone and separate to their family members, there will be more demand for communication. (Australian
Bureau of Statistics (2007).

Economic Environment - Economic environment consist of consumers income levels and their
spending patterns. In some cases, Inflation ratio, Interest rates and employment levels also affects the
economic environment of marketing activities of telecommunication industry. The changes income
living standards rise with the increase income and wealth. There is big difference in structure of income
of people in Australia. The high-income people who are demands for high quality products are able to
pay for it. The low-income people, who are careful in spending, still can afford to pay high prices. In
Australia, the purchasing power of people has increased in recent years. The national disposable
income has rise of 3% from 1992 to 2006. This has increased the purchasing power of people that was
stated in the Australian bureau of statistics report 2007. The Australian telecommunication industry has
experienced very high growth in recent years. In year 2005 there were 16 million customers for mobile
industry representing 81% of the total population. The customers were projected to be 94% by 2006.
Now mobile communication has become very important and integral part of peoples living. The higher
income class is ready to pay for high and efficient technology, while the low-income class is happy to
compromise for the services, which can be serve the basic purpose such has prepaid, cap plans. (The
Allen Consulting Group, 2005, p.4).

Telecommunication companies should consider these trends in spending of consumers and should
design the marketing strategy accordingly. According to Peter Rix (2004) inflation, interest rates and
unemployment rates also can make a significant effect on the marketing environment. The buying
power of consumer decreases, when there is a faster rise in prices of goods and services than increase
in incomes. When the interest rate is high, people delays the buying decisions for big expenditures.
Increase in unemployment rate also decreases the buying power of consumers, as per person income
decreases (Rix, 2004 p. 40-41)
Natural environment - Damage to natural environment is the matter of most concern for almost every
industry not only in Australia but also around the world. For marketers, the most important part is the
use of natural resources used as an input to marketing activities. Depletion of ozone layer, shortage of
water and increase in greenhouse gas emission is the most concerning threats and almost every country
has started taking steps to prevent them. Telecommunication industry should consider the following
four trends in the natural environment and should design marketing activities accordingly.

The Australian telecommunication industry started a recycling program named Mobile Muster for used
mobiles in year 1999. The main aim of this program was to prevent the mobiles from going to landfill
and further doing soil pollution. The program has a network of over 2000 collection points and receives
mobile phones, other accessories and batteries etc. In this program, precious metals such as copper,
silver and gold are recovered from batteries, plastic covers are recycled and circuit boards are used to
recover other metals (Mobile Muster, 2007).

Most recently, green mobiles concept has been launched in Australia. A company named M2
Telecommunication Pty Ltd has launched Australia’s first environmental friendly mobiles. The
company will spend 10 cents for every dollar spent by customers for the climate change control in
Australia (Industrysearch.com.au, 2007).

Technological environment - There have been dramatic changes in the technological innovations in
telecommunication industry in recent years. These technologies have decreased the distance between
places and have changed the lives of people. Now days, there is a rapid growth of internet, e-mail,
mobile phones and SMS messaging making the life easy and cheaply available to ordinary people. The
Internet has opened new world of information sharing (Rix, 2004, p.40-41). The technological
innovations are very fast, as we could not find the products 20 years ago, which we use, in our daily
life. Organizations need to be very creative in products to cope up with the competition or they may
lose their market share. The fast innovations have attracted high research and development costs.
Australian government is encouraging the organizations to engage in R&D by giving different grants
and tax rebates. So the R&D environment is very favorable and they’re many opportunities for
telecommunication industry for growth (Kotler, Brown, Adam, Burton, &; Armstrong, 2007, p.184-
185).

The trend of gaining more education has increased awareness of technology. So telecommunication
industry needs to introduce more technologies, which are user-friendly and easy to access. 2.5
Increasing ethnic diversity: In Australia, about 6.5 million people have migrated since year 1945. In
2006, nearly 24% of the Australian Residents were born in other countries. This reveals the diversity in
ethnicity of Australian society (Australian Bureau of Statistics, 2007). People from different countries
have different buying habits. They have different cultural and religious beliefs. This aspect may affect
TV broadcasting companies. The companies need to show appropriate programs that suit their
expectations on TV programs. Music companies such as MTV are promoting their products, which are
popular in one national group and can be spread in to other national groups (Kotler, Brown, Adam,
Burton, &; Armstrong, 2007, p.180).

Political Environment - its political environment heavily affects the marketing decisions in Australia.
The political environment consists of government rules and regulations, policies, government agencies
and pressure group. The federal Trade Practices Act is the most influencing law to marketers in
Australia. Most of the businesses are regulated by legislations and also there is an increased emphasis
on ethics and socially responsible actions by organisations (Kotler, Brown, Adam, Burton, &;
Armstrong, 2007, p.186-187). Telecommunications Act 1997 The telecommunication industry in
Australia is regulated by Telecommunications Act 1997. This regulation came into effect from 1st July,
1997. The main objective of this regulation is to provide a framework that promotes the long-term
interests of the telecommunications end-users and the efficiency of competitiveness of Australian
telecommunication industry. Second objective is to provide safeguards of public including environment
sustainability (Carlsson, A; Fisher, D. E., 1998, p.63) According to Telecommunications Act 1997, the
company needs to submit a current industry development plan to get the licence to establish the service
carriers. In addition, an organisation must provide access of its infrastructure to other organisation to
provide competitive service and facility or to establish its own infrastructure. Under this act, the
organizations were given access to land to install and maintain the infrastructure needed for the service,
but only when they comply with the state and territory laws (Carlsson, A; Fisher, D. E., 1998, p.64-90).

Cultural Environment - The cultural environment of a society consists of values, beliefs and
perceptions held by its people. Cultural values of people grow in particular society which builds their
values and beliefs. Parents usually pass on these values and beliefs to their children. (Australian Social
Trends, 2007) These beliefs and values may affect marketing decisions of the telecommunication
industry. For example, people in Australia use mobile to stay in touch with each other very frequently.
But most of the people use SMS messaging service rather than directly calling that person by thinking
that other person may by busy and cannot answer the call or he/she may get disturbed. In case of SMS,
the person can reply at his/her convenience. Here, use of mobile is the primary belief and doing a SMS
is secondary belief. Organizations can change the secondary beliefs but it is difficult to change the
primary beliefs of people (Kotler, Brown, Adam, Burton, &; Armstrong, 2007, p.188).

The organisation macro-environment consists of major forces such as demographic, economic, natural,
political, technological and cultural. These forces make the opportunities and threats to the
organisation. The telecommunication companies can predict these movements very easily by
evaluation of the past statistical data. Then can change their strategies, products customization and can
ensure higher profits with greater social responsibility.

References
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Australian Social Trends, 2007. from

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Carlsson, A. & Fisher, D. E., (1998). Environmental Risk Management in the Australian
Telecommunication Industry. Queensland, Australia: QUT Publications and PrintingDaly, A.E. (2001).

Kotler, P., Brown, L., Adam, S. & Armstrong, G. (2007). Marketing (7th Ed.). Frenchs Forest, NSW:
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Rix, P. (2004). Marketing: A Practical Approach (5th Ed.). North Ryde, NSW: McGraw- Hill Australia
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