Question Details

(solution) PESTEL analysis The Organization Political factors Economic


The assignment should be in APA format, double spaced and include a references/works cited section. Assignment should be completed using Microsoft Word. There is no specific page length for the assignment but it should be thorough and cover all aspects of the PESTEL analysis.


PESTEL analysis The Organization Political factors Economic factors Social factors Technological factors Legal

 

factors Environmental factors Managers use the PESTEL framework to facilitate a comprehensive scan of the external environment

 

confronting the organization. Why do you think it is necessary to consider these factors? Political Factors

 

Political factors are external macroenvironmental variables that reflect how

 

government forces impact the competitive

 

market as a whole and the company

 

specifically. This category includes trade

 

restrictions,

 

tax

 

policies,

 

employment

 

regulations,

 

and

 

consumer

 

protection

 

legislation. General political stability and the role of government in providing for fair and safe markets can

 

vary widely from one country to the next. Similarly,

 

significance of political influences on business infrastructure

 

can be substantially different when moving from one product

 

category to the next. Economic Factors

 

Economic factors make up a category of variables that relate to the prevailing

 

overall condition and health of the economy in which target markets exist. Specific

 

variables of concern include gross domestic product (GDP), discretionary income,

 

consumer confidence, unemployment, inflation, interest rates, and currency

 

exchange rates. Each of these factors can have a significant impact on product- and

 

market-level decision making. Interest rates are of particular concern to companies

 

in pursuit of growth opportunities, because as the cost of borrowing money directly

 

affects a business?s ability to expand. Other economic factors directly impact

 

consumers? ability to afford the products being sold. Social Factors

 

Social factors often represent the most important concerns for marketing managers

 

because they reflect two critical classes of customer characteristics: culture and

 

demographics. Culture embodies the shared beliefs, attitudes, and values of a

 

society. Demographics describe the statistical characteristics of a population

 

expressed by variables such as location, age, and employment.

 

The interaction of marketing and culture is a two-way street. Cultural meanings are

 

transferred to products via marketing communications, making products more

 

attractive to consumers who hold these values. In turn, the symbols and icons of

 

cultures and subcultures establish foundational values for many types of product

 

markets. For example, health consciousness is both a value promoted by marketers

 

and a core cultural value shared across many consumer markets. The importance of

 

children?s vitamins to good health and how this is expressed in marketing

 

communications connects the advertiser?s brand-specific message to prevailing

 

cultural norms about caring for one?s family. Similarly, marketers find opportunities

 

to sell products at holidays that revolve around cultural rituals that create or affirm

 

specific cultural meanings.

 

Demographic market characteristics assist marketers in understanding how

 

different segments respond to the marketing programs as a function of personal

 

variables such as age, sex, and income. Attitude research on consumers is often

 

tied to distinguishing how different demographic segments feel about a product or

 

service. Marketers rely heavily on demographics because they can be reliable

 

indicators of how different segments perceive product value. They are also used

 

extensively in the analysis of B2C markets because changes in most demographic

 

variables are easily forecast. Free or inexpensive secondary data are readily

 

available from a large number of government agencies and widely accessible

 

online. Technological Factors

 

Although technological factors are variables that impact some markets and

 

businesses far more than others, all marketing managers need to be aware of the

 

trends and shifts in this category. The dimensions of technological change that most

 

often influence marketing processes include innovations in communication and

 

channels of distribution. Companies at the leading edge of these types of changes

 

can establish competitive advantages and create effective barriers to market entry.

 

By pioneering innovative systems of interacting with customers, processing orders,

 

and distributing products, Amazon. com was able to establish a sustainable

 

competitive advantage rooted in brand awareness and scale economies that

 

effectively prohibits many firms from competing with the company directly. Environmental Factors

 

Environmental factors are primarily long-term ecological concerns that have the

 

potential to impact all businesses at some level. These can be local/regional in

 

scope (e.g., water shortages, chronic flooding) or global. Beyond issues associated

 

with climate change, this category includes factors such as responsible waste

 

disposal, pollution mitigation, and energy efficiency. A prime example of this trend is

 

green legislative initiatives aimed at reducing landfill wastes from sources such as

 

product packaging and the disposal of electronics. In many jurisdictions, ?reverse

 

value chain? laws prescribe the standards and processes for the safe recycling of

 

consumer electronics and appliances. Although some industries such as farming and

 

paper products are more directly impacted than others, environmental factors

 

represent emerging growth opportunities for many more, as markets are

 

transformed to reflect increasing awareness of business?s role in environmental

 

stewardship. Legal Factors

 

Legal factors in the macro-environment include laws and regulations intended to

 

control the behavior of business organizations and special interest groups. These

 

include antitrust laws, Occupational Safety and Health Administration (OSHA)

 

regulations, consumer protection statutes, and product safety and health laws.

 

State and local agencies often impose specific regulations to govern the pricing of

 

consumer necessities and natural monopolies such as utility companies. Although

 

some business leaders may resent what they regard as the ?over-regulation? of

 

markets and business practices, the objectives of maintaining fair standards for the

 

protection of consumers and a level competitive playing field are generally

 

recognized as valid regulatory goals.

 

Each of the PESTEL model?s six factors will be of greater or lesser importance to any

 

given company based on the character of the markets in which it competes. In

 

general, the process of macro-environmental analysis should incorporate as many

 

credible and reliable sources as possible to create a complete picture of relevant

 

trends in the external environment. In many instances, the environmental scan will

 

highlight the need to undertake custom-designed research studies aimed at

 

answering specific questions about markets, customers, or the impact of particular

 

marketing strategies. Implementing the PESTEL Analysis

 

PESTEL analysis is a diagnostic tool to help managers understand the macro-environmental

 

forces that can impact the attractiveness of alternative markets. The purpose is to identify

 

those market-specific elements that may positively or negatively affect the marketing and

 

sale of individual brands. It is often applied to the process of evaluating international options

 

for market development. When used in this way, the specific characteristics of nations are

 

the subject of the analysis.

 

One approach to implementing a practical PESTEL methodology is to score each option using

 

standard measures for each of the six environmental factors identified by this framework. A

 

list of potential indicators for each measure is provided in Table 3.1. PESTEL factors and indicators

 

PESTEL FACTORS

 

Political Economic Social Technological Environmental Legal Useful Resources for your Research INDICATORS

 

World Bank Governance Indicators,

 

Central Intelligence Agency World Fact

 

Book, Heritage Foundation Economic

 

Freedom Index, Trade and taxation

 

policies

 

Gross Domestic Product and GDP per

 

capita, GDP annual growth rate, Net

 

exports, Balance of payments, Current

 

account deficit, Foreign direct

 

investment, Annual rate of inflation,

 

Interest rates, Currency exchange

 

rates, Unemployment rates

 

Population demographics, Income and

 

wealth distribution (GINI coefficient)

 

Literacy rate, Enrollment in

 

educational programs, Human

 

Development Index (HDI) Score

 

(United Nations Development

 

Program)

 

Global Competitiveness Reports: World

 

Economic Forum, Technological

 

infrastructure: Central Intelligence

 

Agency World Fact Book, Rates of

 

innovation and technological

 

obsolescence

 

Human Development Reports (United

 

Nations Environmental Program),

 

Waste and environmental

 

management policies, Clean air, land,

 

and water standards

 

Transparency International, Corruption

 

Index: http://www.transparency .org,

 

Legal statutes on competition and

 

employee safety, Consumer health

 

and safety laws A practical site that provides users with a set of organized procedures to research a

 

company or industry. Links to useful resource and data sites are also provided.

 

http://www.virtualpet.com/industry/howto/search.htm

 

This site is designed to provide entrepreneurs with guidance on how to investigate

 

and analyze both potential customers and competitors. It includes a checklist of

 

readily available data sources as well as information on market research

 

methodologies.

 

http://edwardlowe.org

 

This website provides a thorough presentation on many important aspects of SWOT

 

analysis. It includes useful tools, templates, and worksheets as well as several

 

examples of the technique. Other links on the site include comparable levels of

 

information on the application of the PESTEL analysis methodology.

 

http://rapidbi.com/swotanalysis/

 

This site provides a concise, yet sophisticated, introduction to the application of the

 

Ansoff Matrix model as a tool for strategic planning.

 

http://www.mindtools.com/pages/article/newTMC_90.htm

 


Solution details:

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

Sep 13, 2020

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP/h4>

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • As a reference for in-depth understanding of the subject.
  • As a source of ideas / reasoning for your own research (if properly referenced)
  • For editing and paraphrasing (check your institution's definition of plagiarism and recommended paraphrase).
This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

NEW ASSIGNMENT HELP?

Order New Solution. Quick Turnaround

Click on the button below in order to Order for a New, Original and High-Quality Essay Solutions. New orders are original solutions and precise to your writing instruction requirements. Place a New Order using the button below.

WE GUARANTEE, THAT YOUR PAPER WILL BE WRITTEN FROM SCRATCH AND WITHIN A DEADLINE.

Order Now