PEST/PESTLE analysis examines the macro-environmental factors affecting your market: Political, Economic, Social, Technological, Legal, and Environmental. It helps you understand the forces that create or destroy market opportunities.
PESTLE Framework:
- Political: Government policies, regulations, trade agreements, political stability
- Economic: GDP growth, inflation, exchange rates, healthcare spending trends
- Social: Demographics, attitudes, lifestyle changes, health awareness
- Technological: Innovation pace, digitalization, AI adoption, infrastructure
- Legal: Regulatory requirements (CE, FDA), data privacy (GDPR), liability
- Environmental: Sustainability requirements, waste regulations, green procurement
Key Takeaways
- PESTLE covers 6 macro-environmental dimensions.
- Focus on factors that directly create or destroy demand for YOUR product.
- Political/Legal factors are especially important for regulated industries.
- Technology trends can be both opportunities (AI) and threats (commoditization).