PESTLE Analysis of Flirtey Company for Expanding Business in Germany

This report provides a PESTLE analysis of Flirtey Company for expanding their business in Germany. The report includes external analysis, selection of company and country, political, technological and social factors affecting the business, recommendations and conclusion.

Strategic Marketing 2017-
2018
4/20/2018
Flirtey Company

Strategic Marketing 2017-2018 1
Executive summary
The external analysis is the assessment of the factors that provide the insights of the
opportunities and threats that are available in the business environment for the particular
company. This analysis is very important for all the business that is performing their operating in
the home country or in the other countries where they have expanded the business. In the report,
the Flirtey Company is looking to expand its business in the Germany where the market of
Drones is very attractive due to which most of the companies are expanding their business. The
name of the company clarifies the case study that has been selected for the analysis is on Drones.
The report includes the external analysis (with the help of PESTLE Analysis) of Germany
considering the drone market for the company.
Content

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s
Introduction......................................................................................................................................3
Selection of company and country..............................................................................................3
PESTLE Analysis............................................................................................................................4
Political factors............................................................................................................................4
Technological factors...................................................................................................................5
Social factors...............................................................................................................................7
Recommendations............................................................................................................................9
Conclusion.....................................................................................................................................10
References......................................................................................................................................11

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Introduction
The aim of the report is to draw the understanding related to the external factors that can create
an impact on the working of the company in particular market (Iacobucci, 2014). The external
analysis has been done in the report considering the case study of drones. The company that has
been selected for the analysis is Flirtey who is willing to set their business in Germany. The
report is prepared by the consultant to grab the attention of the CEO of the company for the
strategic move that is an expansion of the business. It has been observed that the company has
the massive opportunity in the market of Germany for Drones. Though, before establishing the
business in Germany the company has to analyze the external factors that can affect Flirtey
Company.
Selection of company and country
The company that has been selected is Flirtey because this company provides the real world
drone delivery service in the current market. Flirtey Company is a Reno, Nevada-based Drone
delivery company who has completed its first FAA (federal aviation administration) approval for
the drone services in the US in the year 2015 (Flirtey, 2018). The company is known for the
autonomous aerial delivery services. Flirtey’s mission is to save lives and improve the lifestyles
by offering the instant delivery services to everyone.
The country that has been selected is Germany which is one of the western European countries.
The country is known as one of the world’s main economic powers along with this it is also
recognized because of its high-tech products (Scahill, 2015). The market of Germany is familiar
with the drone services and there are many companies who manufacture drones such as EMT
Penzberg, Rheinmetall GmbH, and AirRobot. In Germany, the first modern drone system

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introduced into the Bundeswehr for the country’s armed forces in the year 1971 (Coester, 2017).
Therefore, the company has the opportunity of setting business in Germany. Though, the
company might face some competition in the market of Germany.
PESTLE Analysis
PESTLE Analysis is a framework that is mainly used by the company to evaluate and analyze
the factors that can affect the working of the company in the market where they operate their
business (Hill, Jones, and Schilling, 2014). Flirtey Company is willing to set business in
Germany due to which it is essential for the company to evaluate external factors that can affect
the service of drones. The major 3 components of the PESTLE analysis are discussed below: -
Political factors
Political factors that affect the business consist of the new legislation introduced by the company
that affects particular industry (Chernev, 2018). The case study also includes some government
factors that affect the drone service in UAE. In UAE, the drone service is still not approved by
the government. Moreover, the government is taking a step to conduct a trial for the delivery.
Though, the government introduced the legislation related to licensing for the drone.
Political
factors
Technological
factors Social factors PESTLE
Analysis

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The legislation of Germany can affect company working but this is a positive sign that the
government of Germany has approved the drone services in Germany. In the year 2017, the Air
Traffic Licensing Regulations came into existence in Germany. Under this the Air Traffic Act,
the unmanned aerial systems (UAS) or drones introduced in Germany (Gesley, 2017). The Act
includes the control stations which are not used for the hobby or recreational purposes.
Currently, the company introduces new drone rules which include the setting of restrictions for
the people what they can do with their unmanned aerial vehicles in the country. Considering the
new regulation the drone with the weighs of more than 2kg are supposed to take training for
flying drones. Operators of the Drones with the weight of more than 5kg need to take special
permission from the Federal Aviation Authorities. In addition, the operators of the drones can’t
fly their drones above a height of 100m without permission (Meyer, 2017). The drones with the
weight of more than 250g are not allowed to be flown over residential areas.
These are some of the important legislation related to the drones in Germany. These legislations
stop the company to enter the market of Germany. Though, there are many companies who are
operating their business in the market. The approval of the drone services in Europe has provided
the vast opportunities to the company across the border.
Technological factors
The technological factors play a vital role while talking about the drone services because these
services rely on technology mainly. The influence of technology matters a lot for the Flirtey and
evaluation of the Germany technological factors provide an overview of threats and opportunities
for the company in the market (Kotler, 2015). The technology of Germany is discussing the
possibility of the autonomous flight with the help of technology. In the country, it is mostly

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rejected by the hobby pilots due to which are prohibited. This aspect is totally depended on the
technology advancement (Lidynia, Philipsen and Ziefle, 2017).
According to the case study in UAE, the technology and innovation are increasing which is
providing advantages to the company who are involved in the trails, control system and
manufacturing of drones in Dubai. Similarly, the company Ascending technologies of Germany
is specialized in detect and avoid system related to the UAVs. The company is able to
demonstrate and make use of technology to develop a drone that automatically gets away from
the approaching people and obstacles (Conditt, 2016).
Apart from this, the drone is the service which is possible because of the technology only.
Moreover, the new ventures in Germany can effectively make use of this service of a drone to
deliver the goods from place to another. This helps them in establishing a good customer base
which is not possible without technology.
The analysis reflects that the concept of the skies filled with the autonomous flying robots has
changed the way people interact with the world. The autonomous drones are flying in the market
extremely well which is one of the positive aspects for the Flirtey. The company can easily set
their business in the market of Germany (Dillow, 2015). The demand for the drone services is
growing in the market of Germany as a maximum number of people has started making the use
of this service. Though, there is one of the biggest negative aspects that are lack of perception of
having zero awareness related to the other aircraft that are operating in their immediate vicinity.
This might lead to accidents in the air of drones due to which it is essential to track and control
the drone. Moreover, considering the same the government is focusing on the training to the
operators of the drone.

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In the near future, there will be a change in the technology which will bring the innovation in the
existing services and will provide the opportunities to the company to deal with the service
related to drones. This will be one of the opportunities for the Flirtey who is setting their
operation. Along with this, the technology will bring the development of the company and open
news for them.
Social factors
The social factors include believing, preference, and trend of the society that affect the business.
Over here, the social factor is considered on the basis of the acceptance of the drone by the
people of Germany (Kotler, 2015). There are numerous businesses that are making use of the
drone services in their business. According to the case study, there are many companies who
shared their future plans related to the emergence of the drone services in the UAE market. Uber
a well-known company has introduced the plans related to the network of the flying cars in
Dubai in the year 2020. Along with this, RTA of the country has decided to conduct an
autonomous air taxi in the month of June 2017. This reflects that UAE businesses are also
accepting the use of drones in their business operations.
More and more private companies in Germany are using UAVs commonly known as drones for
different purposes such as photography, map-making, industrial complexes, construction sites,
and for the surveillance of the large solar firms. According to the analysis, Germany's Federal
Ministry of Transport, more than 500 applications have been received for the permission related
to the use of the drones in their business in the last 2 years (Deutsche Welle, 2018).
Moreover, not only the private businesses are making use of drone but the government has also
decided to make use of drones in Germany. Currently, the government of the country has

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announced that they are planning to do a 180-degree policy shift by developing the armed drones
in the combat. Though this is the fact that the decision of the government is still in the discussion
but this reflects that the future of the drone companies is bright in the Germany country
(Darnstaedt, 2013). This reflects that the company has the opportunity after considering the
acceptance of the drone services by the companies there will increase the demand for the drones
service provider.

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Recommendations
The analysis of the external factors of the Germany market includes both positive and negative
aspects in the form of opportunities and threats for the Flirtey. Considering the analysis some of
the recommendations are made after evaluating the issues.
 It is recommended to the company to enter into the market of Germany though there are
certain aspects that can affect the working this is the opportunity for the company to
expand their business in other countries as well. Moreover, the demand for the drones is
expected to rise which is considered an opportunity. The company will also be able to
make the good market position if they make use of corrective strategy in Germany.
 It is recommended to appoint a legal consultant who can help them to consider the
legislation introduced by the government of the country in the business of drones as these
legislations leads to the risk.
 The rise in competition in the market of Germany is another issue for which the company
should make the competitive advantage which helps them to stand out different from
their competitors.
 Technology advance might lead to competition intensive but it is suggested to make use
of advanced technology in the business which makes the service more effective for the
customers of Flirtey.

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Conclusion
In the end, it can be concluded that the expansion of the Flirtey Company in the market is one of
the effective decisions as the market consists of both positive and negative aspect of drones.
After the acceptance of Drones in Germany, there are many companies who expanded their
business and few are thinking to expand their business because this is the time when they can
make the strong customer base in the market. Moreover, the analysis reflects that the company
might have to face the tough competition from those who are already based in Germany and
those who are going to enter into the market of Germany in the coming years. In addition, the
detailed analysis is discussed which shows that there are vast opportunities for the business.
Though, they have to deal with some of the challenges. In the end, there is some
recommendation provided to the company which helps them to overcome the issues that they
will face in the market of Germany.

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References
Chernev, A. (2018) Strategic marketing management. Chicago: Cerebellum Press.
Coester, C.G. (2017) Will Germany miss out on drone market opportunities? [Online]. Available
from: https://theheureka.com/will-germany-miss-out-on-drone-market-opportunities-20170125
[Accessed 20th April 2018]
Conditt, J. (2016) Intel buys German drone company Ascending Technologies [Online].
Available from: https://www.engadget.com/2016/01/04/intel-buys-german-drone-company-
ascending-technologies/ [Accessed 20th April 2018]
Darnstaedt, T. (2013) 'New Wars' Demand New Mindsets [Online]. Available from:
http://www.spiegel.de/international/germany/use-of-armed-drones-by-germany-in-new-wars-
demands-new-thinking-a-882056.html [Accessed 20th April 2018]
Deutsche Welle (2018) Use of drones on the rise in Germany [Online]. Available from:
http://www.dw.com/en/use-of-drones-on-the-rise-in-germany/a-16047503 [Accessed 20th April
2018]
Dillow, C. (2015) This unsexy technology is set to revolutionize the drone industry [Online].
Available from: http://fortune.com/2015/05/05/drone-technology/ [Accessed 20th April 2018]
Flirtey (2018) About [Online]. Available from: https://flirtey.com/about/ [Accessed 20th April
2018]

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Gesley, J. (2017) Germany: New Rules for Operation of Drones and Model Aircraft [Online].
Available from: http://www.loc.gov/law/foreign-news/article/germany-new-rules-for-operation-
of-drones-and-model-aircraft/ [Accessed 20th April 2018]
Hill, C.W., Jones, G.R. and Schilling, M.A. (2014) Strategic management: theory: an integrated
approach. UK: Cengage Learning.
Iacobucci, D. (2014) Marketing management. UK: Cengage Learning.
Kotler, P. (2015) Framework for marketing management. India: Pearson Education.
Lidynia, C., Philipsen, R. and Ziefle, M. (2017) Droning on about drones—acceptance of and
perceived barriers to drones in civil usage contexts. In Advances in Human Factors in Robots
and Unmanned Systems, pp. 317-329.
Meyer, D. (2017) Drone laws: New German rules aim to stop eye-in-the-sky snooping [Online].
Available from: https://www.zdnet.com/article/drone-laws-new-german-rules-aim-to-stop-eye-
in-the-sky-snooping/ [Accessed 20th April 2018]
Scahill, J. (2015) Germany is the tell-tale heart of America’s drone war. The Intercept, 17.