Before We See PESTLE Analysis Examples, Let’s Recap on the Basics.
A PESTLE analysis looks at the macro trends in the surrounding environment of a certain business or organization. It examines the political, economic, social, technological, legal, and environmental elements of the operating market that may have either positive or negative effects on your company or organization.
A PESTLE analysis is often used as an extension of a SWOT analysis. Remember that the external matrix of the SWOT evaluates and creates awareness about the opportunities an organization should take advantage of, as well as the threats it should avoid. This external analysis is part of evaluating your organization’s strategic position within its market, industry, and larger operating environment.
Here, we will take a deep dive to examine what you should feature in your own PESTLE analysis. We’ll examine some PESTLE analysis examples from some of the most successful companies of our time.
Definitions and General PESTLE Analysis Examples:
A PESTLE analysis will look different for each industry, and it must be approached differently as well. Consider your organization’s unique position, market, and needs when conducting a PESTLE analysis.
It is easiest to begin with a SWOT analysis and then use your PESTLE as a companion piece to dig deeper into the external megatrends—both threats and opportunities—that the market and operating environment will present to your organization.
From our PESTLE analysis examples, here are some factors you may consider using:
Examples of Political Forces
These are the external forces affecting your organization that are brought on by government. They may include laws, policies, regulation or de-regulation trends, governing bodies and leadership, foreign trade and foreign relations, political issues and trends, tax policy—any political factors that could influence your organization’s opportunities or threats.
Examples of political forces include:
- Changes in government/election cycles: Will the possibility of shifting party majorities in upcoming or recent elections affect regulation or de-regulation in your industry or a related industry? Does this create a threat or an opportunity?
- Fiscal policies: How might changes in tax codes affect your budget and profits? How can you prepare for this?
- Wars and conflicts: What recent or current conflicts might affect foreign relations and/or trade in your industry? What can you do to create stability?
- Legislation changes: Is there legislation (proposed or passed) that would substantially affect your operations or your customers?
- Trade agreements: Do you see any upcoming opportunities in the form of new foreign markets? Or conversely, do you see any threats to your foreign markets?
- Political movements: What issues are becoming increasingly important to the people in your target audience? How does this affect their relationship with your brand?
Examples of Economic Forces
The economic environment you operate in includes several factors to consider, such as general economic climate, taxation, and globalization. Inflation rates, shifts in consumer spending, supply chain issues, demand curves, and global economic health may all be a part of your economic analysis.
Examples of economic forces include:
- Employment rates and compensation: Do you have a ready labor market, or are good team members hard to come by? Which direction is the trend heading? What do you need to consider in terms of compensation to bring on and keep talent in your industry?
- Inflation: How is inflation affecting the price of your materials? How is it affecting your customers and their spending?
- Currency devaluations: How is your currency—and the currency of your customer base—performing? How might this affect your costs and revenue?
- Stock market and market values: What recent or predicted trends in the stock market do you see impacting your industry and your organization?
Examples of Social Forces
Social forces focus on the opinions and attitudes of consumers that relate to your product, as well as the changing population and demographics of your operating market. Your analysis might consider social justice movements and other trends, both in your immediate environment and in the broader environment your customers are coming from.
Examples of social forces include:
- Demographic changes: What are the ages, experiences and backgrounds, and racial and gender identities of your customer base? Have any of these shifted or are they projected to shift? If so, how and why? What do you need to do to accommodate customers coming in?
- Religious beliefs: Are there religious or spiritual beliefs that intersect with your organization or your product? How can you be sensitive to those?
- Consumer opinions: How do consumers feel about your product (or products like yours)? Are there positive or negative changes in this general sentiment?
- Purchasing patterns: Due to economic or other factors, are your customers spending less in your market? More?
- Popular media: What current events, celebrity opinions, or other media influences will your consumers be tuned into? Are there any that might affect thoughts, ideas, and feelings about your organization, product, or brand?
Examples of Technological Forces
This focus area considers how technological forces may be impacting your organization. Changes in technology can affect your positioning as an organization. Some recent examples are the rise of cryptocurrency, the emergence of work-from-home technology, AI developments, and even concerns over cyber security.
Examples of technological forces include:
- Increased emergence of AI: What capabilities do you see as opportunities for your organization?
- Energy usage: What new technologies would allow you to save on energy costs (both to your organization and to the environment)?
- Cloud software: What developments have been made to cloud storage to make it more effective, and are you taking advantage of those developments? Conversely, are there security threats to be aware of in this software for your organization’s data?
- Internet: What improvements are available to maximize speed and reliability for the online work of your team?
- Technology usage incentives: Are there incentives available to encourage certain technology use?
- New machinery or tech: Are there emerging industry-specific technologies or equipment that would improve the quality, cost, or efficiency of your organization’s work?
Examples of Legal Forces
While similar to the political aspects, the legal elements in your PESTLE analysis examine the practical application of those political factors into rules and regulations that impact your organization’s business or customers. Depending on your business, you may need to consider local and state laws as well as federal laws.
Examples of legal forces include:
- Patent and intellectual rights laws: How might developments or decisions in intellectual property law affect you and/or your competitors?
- Protection laws: Are there consumer protection laws that would affect the way you interact with and do business with your customers?
- Occupational safety laws: What occupational safety laws do you need to be aware of to conduct business in a way that protects both your employees and your organization?
- Import and export laws: What legal parameters are there for ordering goods from other countries, as well as for selling your product in other countries?
- Licenses: What licenses do you, your employees, and your organization need in order to fill the roles that are needed?
Examples of Environmental Forces
Environmental factors are affected by weather, geography, climate change, and health crises. In addition to the public health crisis caused by the pandemic, the world has also been impacted by wildfires and other natural disasters across the globe. As an organization, you ought to consider the short-term and long-term impacts of these accelerating changes.
Examples of environmental forces include:
Climate change:How might short- and long-term effects of climate change, including rising sea levels and increasing frequency of extreme weather, impact your organization and customers?
- Consumption of non-renewable resources: What necessary resources could become limited or depleted in the future that would impair your business?
- Energy alternatives:
- Gas emissions: How does your organization contribute to, and how is it affected by, gas emissions? What steps could be taken to reduce emissions and to prepare against the effect of emissions?
- Natural disasters: What natural disasters pose a threat in your area, or in the areas where many of your customers are located? How can you be prepared for these threats?
- Environmental hazards: What other hazards in your environment could prove threatening to your organization?
What developments in clean energy might be accessible and beneficial for your organization?
*Bonus: Ethical Factors to Consider
Over the last few years, business and marketing strategy experts have added a third ‘E’ to the PESTLE analysis – the ethical factor. This can include things such as fair-trade practices, child labor issues, increasing demand for conscious business models, and corporate social responsibility. As these issues come to your attention, examine the megatrends and take the opportunity to evaluate them within your organization’s environment.
Examples of ethical forces include:
- Workers’ rights: What strides can your organization make (or what strides is your organization already making) to take care of those who work for you?
- Fair trade laws: Especially concerning overseas trade, what issues do you need to be aware of in order to promote ethical and responsible practices?
- Human rights issues: How far have you followed the organizations you partner with, contract with, buy supplies from, and do other business with? Are there any organizations whose relationships need to be reconsidered due to human rights violations?
- Corporate social responsibility:
- Diversity, equity, and inclusion: What practices and attitudes are being adopted successfully to promote diverse, equitable, and inclusive workplaces? Conversely, are there practices and attitudes that are backfiring? Which might you best adapt for your organization?
In what ways can your organization give back to its community? How can you maximize these opportunities and use them to build meaningful relationships?
6 Real-World PESTLE Analysis Examples from 8 Successful Companies:
Food and Beverage Industry PESTLE Analysis Examples:
Starbucks PESTLE Analysis Example
For Starbucks, lowering costs and staying aware and sensitive to the issues that are important to its customer base are two courses of action that become clear after an environmental analysis.
- Sourcing raw materials and following fair trade practices, which has gained a lot of attention from politicians in the West.
- Keeping up with laws and regulations in other countries from which Starbucks buys its raw materials.
- Economic recession, which has led many customers to seek cheaper alternatives.
- Rising labor and operational costs due to inflation.
- Retiring of the Baby Boomer generation, along with changing family patterns and lowered birth rates leading to fewer spending customers.
- Changing workstyles and lifestyles, including increased remote work.
- Enabling mobile payments, which increases the potential customer base.
- Agricultural developments that might impact raw material production.
- Introduction of caffeine consumption-related policies by health organizations.
- Industry licensing regulations.
- Natural disasters in countriesthat produce coffee beans.
- Environmental laws and regulations related to packaging and waste.
Beyond Meat PESTLE Analysis Example
A California-based producer of plant-based meat substitutes, Beyond Meat is poised to take advantage of many environmental trends that could provide an opportunity to expand.
- Animal farming is receiving political pressure to cut back on expansion.
- Laws and regulations about greenhouse gas emissions.
- Vegan meat is projected to grow from 1% to 10% of meat consumption by the end of the decade.
- Vegan meat has the potential to be cheaper than animal meat, but would need drastic changes to its efficiency to realize this.
- Rise of veganism in developed countries.
- Increasing awareness and vocality of environmentally conscious citizens.
- An extensive amount oftechnology in R&D for this industry.
- Social media and other technological platforms for advertising and brand-building.
- New food safety standards to classify plant-based meat products.
- Soy farming has raised some concerns about deforestation and soil degradation.
- Plant-based products shown to be much moreenvironmentally friendly than animal meats.
Retail Industry PESTLE Analysis Examples:
Walmart PESTLE Analysis Example
Due to its size and profitability, Walmart has a uniquely competitive edge, yet its growth and continued profitability are sensitive to several external factors.
- Global differences in government regulations, such as banned products in some countries.
- Emergency curfews closing stores early.
- Inflation raising costs; brand appeal is based on low prices.
- Supply chain issues. Continued pressure on the supply chain and inflation is causing increased overhead costs.
- Business model rejected in some places, such as Germany.
- Increased trend toward online shopping, especially post-pandemic.
- Consumer push for same-day delivery of products.
- Adoption of automation for basic tasks.
- Expansion of mobile app and online services.
- Expansion of available technology in distribution and warehouse centers.
- Proposed legislation to raise minimum wage.
- Recent labor lawsuits open doors for further litigation.
- Call to reduce waste and use of nonrenewable energy.
- Weather and climate considerations in a wide number of locations.
Amazon PESTLE Analysis Example
The technology and online retail giant has many opportunities to capitalize on, with a few threats to monitor.
- Government pressure on anti-trust and monopolies for major corporations.
- Pressure from the federal government and local government about employment practices.
- Governmental regulations on cybersecurity and privacy protection.
- Increasing disposable incomes in developed countries.
- Inflation and supply chain issues impacting online stock.
- Macro-trend for organizations to seek and purchase cloud computing products and solutions.
- Increasing consumerism in developed economies and emerging economies.
- Increasing demand for same-day delivery of products to consumers.
- Increasing dependence on technology, cloud computing, and AI.
- Expansion of robotic automation for picking, packing, and delivery of the product.
- Expansion of AI to serve Amazon Web Services.
- Unionization and labor laws impact Amazon’s workforce.
- Changing import and export regulations.
- Import and export tax on goods sold.
- Increasing energy costs increase the cost of supply chain delivery.
- Environmental impact of plastic and plastic packaging.
- Carbon emissions and new fuel options as an organization.
Tech Industry PESTLE Examples:
Apple PESTLE Analysis Example
Like other big tech companies, Apple stands to gain from growing reliance on digital technologies and movement toward energy efficiency—but so do its competitors.
- Trade disputes, especially between the U.S. and China.
- Pressure from federal regulators on antitrust.
- Increasing political pressure on consumer privacy protection and data.
- Changing economic tides and changing economic forecasts create uncertainty in the tech sector.
- Supply chain scarcity and resource constraints on product production.
- Stagnant changes to income of Apple’s buyer pool for luxury products.
- Rapid growth in emerging markets for entry-level products.
- Rising global use of mobile access across the globe.
- Increasing global dependence on digital ecosystems.
- Anti-Apple sentiment due to exclusivity and price.
- Growing technological and development capabilities of the competitive set.
- Pressure from cybercriminals threaten the data security of Apple products.
- Increasing privacy regulations and protections.
- Legal challenges to Apple’s policies and practices related to the app store.
- Ethically and efficiently recycling broken and unused electronic devices, especially those containing lithium batteries.
- Environmental impacts of manufacturing products in China.
- Climate change impacting shipping and supply chain routes.
Airbnb PESTLE Analysis Example
The unique matchup business model of Airbnb, as well as companies like Uber and Lyft, have taken the market by storm—but have also incurred significant legal battles.
- Housing laws and vacation rental bans in some markets conflict with business model.
- Varying tax rates from counties and countries.
- The housing crisis and crunch in the housing market.
- Varying prices and availability of hotels as a primary competitor.
- Increase access and desirability of travel.
- Resistance from locals about the impact of vacation rentals in residential areas.
- Social acceptance of ridesharing and travel sharing business model.
- Increased reliance on mobile apps and other digital solutions.
- Increasing security of online payment systems.
- Legal challenges in some states and countries.
- Environmental impact of single-use products for hospitality.
What is the purpose of conducting a PESTLE analysis?
A PESTLE analysis can help you understand where your organization stands in the external market and assess the macro-trends that could potentially affect your business/product.
What are all the components of a PESTLE analysis?
A PESTLE analysis looks at six aspects of the environment that could impact your organization: Political, Economic, Sociological, Technological, and the two newly added — Legal and Environmental. Some PESTLE analyses even incorporate ‘ethics.’
What does PESTLE stand for?
Two things you should always consider as you’re going through each aspect of the PESTLE analysis are: where am I now, and where do I want to go? These two questions will guide you in figuring out your current state in the macro environment and your ideal state. Next, it’s important that with each factor or event you outline in your PESTLE, you also consider whether they pose an opportunity or a threat.