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Pestle Analysis

What is A PESTLE Analysis with Examples

PESTLE analysis is a form of analysis of great importance that companies use in their strategic planning. In this article, I will talk about what is PESTLE analysis and what are its factors.

What is A PESTEL?

PEST Analysis is also known as PESTEL Analysis or PESTLE Analysis. The name of the analysis comes from the initials of the words “Political, Economic, Social, Technological, Legal and Environment.” Let’s look at each title.

PESTLE Analysis
PESTLE

PESTLE Analysis Factors 

PESTLE Analysis Political Factors

Political environment; influences companies through several factors such as:

  • Taxation,
  • Fiscal policies,
  • Incentives,
  • Conflicts,
  • International relations,
  • Election and its consequences

The moves of political decision-makers affect businesses a lot. It will be advantageous for the company to anticipate changes in the political environment. Suppose a decision on tax regulations is expected soon. Companies should follow this situation, take an appropriate position, and make plans.

PESTLE Analysis Economic Factors

Economic factors are one of the essential structures in companies’ strategic planning. Economic factors are also linked to political situations. Companies should know and follow the case of the country they are in and the countries in which they do business, such as;

  • Foreign exchange rates
  • Inflation rates,
  • Tax rates,
  • Status of the stock market,
  • Unemployment rate
  • Interest rates

For example, Increasing inflation in the countries where the company is located or operates; will result in higher prices for products or services. Planning should be done by taking into account such situations and anticipating what might happen.

PESTLE Analysis Social Factors

Social factors are the steps that require examining the demographic and cultural structures of the people in the region where the company is located and doing business and strategic planning in this direction.

Social factors include issues such as;

  • Population growth rate,
  • Demographics,
  • Education level,
  • Lifestyle
  • Consumer behavior
  • Religion and ethics

For example, to plan supply and demand, it is necessary to analyze and evaluate consumer behavior.

PESTLE Analysis Technological Factors

Technological factors are essential when planning in line with technological developments. It is necessary to follow the technological developments in the world and do strategic planning by these developments. Some of the factors that will affect companies are:

  • Innovations in communication,
  • Server or internet costs and possible changes,
  • Innovations,
  • Automation
  • New technologies produced etc.

PESTLE Analysis Legal Factors

Although legal factors are very similar to political factors, the effects of legal regulations on businesses are analyzed, and strategic planning is prepared accordingly. Some of the legal factors are;

  • Employment laws,
  • Commercial Law,
  • Consumer protection,
  • Environmental regulations,
  • Factors such as Copyright and Pantene Laws.

PESTLE Analysis Environmental Factors

Environmental factors were added to the pest analysis factors later.

  • Climate,
  • Geographical location
  • Weather,
  • Global climate change,
  • Environmentally friendly products and applications are essential topics.

These factors are mostly the ones that the enterprises in the tourism, agriculture, and forestry sectors examine when doing strategic planning. Still, today, global climate change and climate crisis are issues that concern us all.

In addition, I think the following articles will help you in your marketing efforts,  “What is Digital Marketing?“, “What is SWOT Analysis and How to Do It?“, “What is Marketing Mix (4P to 7P)?” and RACE – Digital Marketing Planning Model.

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