PESTEL as a Strategic Marketing Tool

Running head: PESTEL AS A STRATEGIC MARKETING OOL 1
PESTEL AS A STRATEGIC MARKETING TOOL
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PESTEL AS A STRATEGIC MARKETING OOL 2
PESTEL AS A STRATEGIC MARKETING TOOL
Executive summary
The study was intended to critically analyze the PESTEL as a strategic management tool and how
it can be used to best investigate the external marketing variables which determine the success of a firm/
business. The study also looked into the background of PESTEL and
Introduction, conceptual and theoretical framework of PESTEL
For decades, PESTEL analysis has been used as one of the most important and powerful tools for
the analysis of the external factors that may affect the effectiveness and success of a firm within a given
industry or market. In other words, it has for over three decades been regarded as a tool for scanning the
macro economic conditions/ environment when taking a critical analysis of the market
The invention/ introduction of PESTEL analysis as an economic and marketing tool is attributed
to the works of Francis Aguilarwho, who by then put more emphasis on the analysis of ETPS, implying
Economic, technological, political and social context. When putting up the theory, he cleared put
emphasis that before a firm or a business enterprise considers establishing a business or strengthening its
performance, it should aim at discovering those factor as there are the main determinants of a business
performance (Constantinescu & Nistorescu, 2012, 778)
Later on, after the works of francis aguilarwho, another scholar known as Arnold brown came in
to put more emphasis of the same factors but this time, he only reformed it PEST which still refered to the
same tools of analysis. Tracing on a clear background of when this tool developed, it is not certain but it
is important to note that, as of the current world error, it is regarded as PESTEL analysis

PESTEL AS A STRATEGIC MARKETING OOL 3
According to Vitkienė (2009) PESTEL has been defined as an crayon for six sources of change
that is to say the political, economic, social, technology, environment and legal.
This tool has been used by many big and reputable companies in creating an understanding of the
external marketing environment. According to reports, this has proven to be effective and is evidenced by
its worldwide adaptation of the tool. This tool was built on the basis that the external environment is
composed of variable that are beyond the control of a firm and in which case, a firm must be able to
critically analyze and align the most appropriate goals which can adequately abide by the external
variable without negatively affecting a business but rather utilizing the available opportunities (van et al.,
2012, p.40).
Firms run as part of the wide ecosystem, which implies that they can negligibly affect the
operation of the whole system but rather can be affected by the way the system runs. The effect my
ofcouse be ether positive or negative. It is in this context that requires the analysis of these external
variables for a positive adjustment.
Effective practical foundation
Definition
Research studies have indicated that there has been an increasing level of awareness of ecological
environmental issues which has caused a tremendous change in the operation of business. From the
summery of different research literature, and also as implied by the name, it is an analytical tool used for
forecasting the external market conditions of a p[articular business context.
PESTEL is an abbreviation for;
p-political
E- economic
S- social