An introduction to the marketing tool PEST analysis for small businesses

In this blogpost l will discuss the marketing tool PEST analysis, which is used when you develop a strategic marketing plan. After you have closely examined the potential of your chosen market, it is necessary to take a wider view by examining the environment in which you plan to conduct your business. When you are thinking strategically, it is always with a long term objective in mind to survive or thrive in the long term.  It will be important to remain vigilant and consider the world/environment in which you plan to develop your business. This will include uncontrollable factors that influence an organization’s decision making, and affect its performance. These factors fit into the acronym PEST:


Includes regulations and legislation which may impact your market or your suppliers


Includes the current state of the domestic economy and its likely performance in the next one to five years. It is important to consider
• The rate of inflation
• Employment levels
• Economic growth forecasts
• Regional disparity
These factors may affect your customers’ ability to purchase your product at your existing price.


Includes a review of human behaviour and how the society and culture is changing. I think of this step as your opportunity to try to tune into the zeitgeist; it’s not dissimilar to developing a feel for “what’s hot, and what’s not?”. This is not solely about analysing data, but about interpreting it to see whether you can uncover opportunities which might keep your business ahead of the curve.
PEST analysis isn’t a one-off activity. It is a constant background activity for you to keep in mind at all times.  My reason for bringing it to your attention this week stems from the many headline stories which contribute to the uncertainty within which you’re building your business: Brexit, Syria, Facebook


This is a vast topic, changing daily. I will expand on this topic next week.

By continually maintaining an awareness of factors which fit into PEST, you will be able to adapt your business approach when it’s required and thereby be better placed to anticipate your customers‘ needs.  If you would like to discuss the elements in your PEST analysis, please email [email protected]