PESTLE analysis, which is sometimes referred as PEST analysis is a concept in marketing principles. Moreover, this concept is used as a tool by companies the world over to track the environment they’re operating in or are planning to launch a new project/product/service etc.
PESTLE is a mnemonic which in its expanded form denotes P for Political, E for Economic, S for Social, T for Technological, L for Legal and E for Environmental. It gives a bird’s eye view of the whole environment from many different angles that one wants to check and keep a track of while contemplating on a certain idea/plan.
The framework has undergone certain alterations, as gurus of Marketing have added certain things like an E for Ethics to instill the element of demographics while utilizing the framework while researching the market.
There are certain questions that one needs to ask while conducting this analysis, which give them an idea of what things to keep in mind. They are:
What is the political situation of the country and how can it affect the industry? What are the prevalent economic factors?
How much importance does culture has in the market and what are its determinants? What technological innovations are likely to pop up and affect the market structure? Are there any current legislations that regulate the industry or can there be any change in the legislations for the industry? What are the environmental concerns for the industry?
All the aspects of this technique are crucial for any industry a business might be in. More than just understanding the market, this framework represents one of the vertebras of the backbone of strategic management that not only defines what a company should do, but also accounts for an organization’s goals and the strategies stringed to them.
It may be so, that the importance of each of the factors may be different to different kinds of industries, but it is imperative to any strategy a company wants to develop that they conduct the...
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