1. PESTEL
Claire Devlin

2. Environmental Analysis
Political
Economic
Socio-cultural
Technological
Environmental
Legal
Claire Devlin

3. Political
Government ownership of industries and attitude to monopolies and competition
Taxation policy
Foreign trade regulation
Government stability
Political parties and alignments at local national and European level
Claire Devlin

4. Economic Factors Business cycles GNP trends Interest rates
Unemployment
Energy factors
Currency fluctuations and exchange rates
Inflation
Consumer expenditure and disposable income
Claire Devlin

5. Socio-cultural factors
Attitudes to work and leisure
Demographic change
Income distribution
Social mobility
Lifestyle
Consumerism
Health and education
Claire Devlin

6. Technological Government spending on research
Industry spending on research
New developments or discoveries
New services, products and ideas
Speed of technology transfer
Internet availability
Telecommunication infrastructure
Degree of competition
Claire Devlin

7. Environmental Green issues that affect the environment
Level and type of energy consumed
Renewable energy
Rubbish waste and its disposal
Claire Devlin

8. Legal Competition and government policy Employment and safety law
Product safety issues
Claire Devlin

9. Environmental Analysis
A strategic planning system interacts with the environment, especially those factors that have actual or potential impacts on the organisation
Environmental forces impact on business in different ways and with different degrees of strength
Claire Devlin

10. Basis of effective PESTEL analysis
A PESTEL analysis should not result in a long list of factors
It should concentrate on the key issues relating to the industry or firm
Claire Devlin

11. Basis of effective PESTEL analysis
Strategic issues that will impact on the firm.
A change in the law. The tariff on plastic bags has affected the companies that makes them
A change in technology: such as development of a hard plastic to replace metal components
Claire Devlin

12. Basis of effective PESTEL analysis
Trends
Need to look at factors that will affect the firm,
Ageing populations,
Rise in energy costs
Restrictions on waste
Claire Devlin

13. Basis of effective PESTEL analysis
Patterns
Clusters of related activities that change the behaviour of the target market.
These are most often seen in life-style models such as the “Yuppie” phenomenon of a few years ago
Claire Devlin

14. Basis of effective PESTEL analysis
Projections and forecasts
Some demographic trends are well understood. Rise of the affluent grey market resulting from early retirement and home ownership
Trying to predict behaviour in the green environmental market more difficult since it is a life style choice and is erratic and unstable
Claire Devlin

15. Basis of effective PESTEL analysis
Changes
Unexplained or sudden changes in trends. Each warrants further study to see if it is a “one off” or the start of a strategic issue.
e.g.,
Texting on mobile phones
Rise in alcopops
Atkins diet
Claire Devlin

16. Applications of PEST model
Apply PEST factors to recent developments in:
public houses
the grocery retail trade
the mobile phone industry
Claire Devlin

17. Application of PEST model to Public Houses
Political: smoking ban, introduction of identity cards
Economic: rise in disposable incomes
Social/cultural: alcopops introduced for younger drinkers. The switch from brown to white spirits
Technological: wide use of TV for matches
Claire Devlin

18. Applications of PEST model to The grocery retail trade
P Regulations concerning under-cost selling
E Rise in incomes which allowed Lidl to enter market unnoticed. Fall in incomes leading to stealing market share
S Choice of sites for Lidl. Growth in petrol station forecourt shops to accommodate fast pace of life
T Use of loyalty cards to build up customer profile
Claire Devlin

19. The grocery retail trade
Political
More info on products
Selling certain % of Irish goods
Minimum wage
Competition regulation
Claire Devlin

20. The grocery retail trade
Economic
More money to spend
Inflation
Rising incomes allowed Lidl to enter market unnoticed
Claire Devlin

21. The grocery retail trade
Socio cultural
More women working/convenience food
Consumers more informed
Bigger range of products/ more ethnic products
Differently priced supermarkets aiming at different market segments
Claire Devlin

22. The grocery retail trade
Technological
On line Tesco
Scanning automatically
Loyalty cards
Claire Devlin

23. Application of PEST model to the mobile phone industry
P granting of licences for 3G phones too expensive (governments have a monopoly)
E increase in disposable incomes. Texting seen as cheaper and more efficient option
S young people create Texting themselves. Mobile phone seen as indispensable in a busy world. Tariffs on pre-paid phones
T predictive text, colour screens, cameras, new 3 G phones
Claire Devlin