Environmental analysis: PEST (Political and Economic and Social and Technological)

Environmental analysis: PEST (Political and Economic and Social and Technological)

Environmental analysis: PEST (Political and Economic and Social and Technological)
in op shop in Australia

Below are links you may find useful when beginning to undertake your analysis.






HappyDays is a not for profit charity based in Adelaide. The charity has been providing camps for children aged between 5-16 years of age, who are impacted by a range of issues including low socio-economic disadvantage, abuse or disabilities. The charity has been operating for over 20 years and was founded by Edwina Smith. Edwina was from a poor migrant family, who moved to Australia when she was a small child. Following their dream of a better future for their children, they encouraged Edwina to work hard at school. Edwina eventually became a Doctor, specialising in paediatric care.
Edwina was always grateful to her parents for providing her with the opportunity to become a doctor. In their memory she established the charity, with the mission œTo provide all children with the opportunity to escape their everyday lives. A key aspect of the charity is to provide each child with a camp mentor who supports them in learning that they have the potential to make all their days œHappy Days.
Following her retirement, Edwina established a trust fund to secure the future of the charity. The trust fund currently pays the salary of the Executive Officer and a part time administrator. The Executive Officer is responsible for raising funds for the camp through grant applications and donations. The administrator undertakes a number of tasks including bookkeeping and volunteer recruitment. The charity is also supported by a network of 100 active volunteers, mainly in the age group 18-30 years of age. 70% of the volunteers are university students. These volunteers work in a number of roles, but are mainly involved in organising and attending camps to work as mentors, cooks or activity organisers.
The Executive Officer has recently compiled a briefing for the board members which highlights the following key points:
    Camps operate over 2 days, although an additional 2 days are required with volunteers for pre-camp planning and camp de-briefing.
    Each camp costs $5000 to operate and enables 15 children to attend.
    The charity has provided an average of 10 camps per year for the past 3 years.
    Whilst demand for camps has grown, the Executive Officer has experienced difficulty in raising funds through the two traditional sources used in the past. The majority of funds have been raised through grant applications, although at least one camp a year has been provided by donations.
    To increase the number of camps provided, alternative sources of funding are required. The Executive Officer proposes that the charity establishes an œOp Shop.

The board members have read the brief and have discussed this with the Executive Officer. Whilst they are not directly opposed to the idea, they are concerned that the Executive Officer has not considered the proposal in sufficient depth. Before they will agree to this decision they have requested that the Executive Officer completes a Strategic Marketing Plan.
The Executive Officer has no experience in developing Strategic Marketing Plans. She has approached the University of Hope for assistance. As students at the university, you have been selected to undertake this task for them.

Learning outcome assessed:
    Examine and analyse the internal and external environment that influences strategies and decisions
    Provide succinct and well researched analysis of tools and models for marketing strategy and planning
    Critique concepts and theories in relation to marketing strategies and planning

The global financial crisis

Effects of the global financial crises in Australia:
Increase in sales of DIY products, mostly under $100
Increase in sales of products such as eggs, butter, value cuts of meat and non-branded products
Value packs popular at Estee Lauder counter in Myer
Non-profit sector/charities experienced a lack of funding
Designer clothes at 75% off
Couples planning weddings spent less than previous averages

Environmental scanning

The underlying importance of environmental scanning is captured in Darwinian laws:
The environment is ever-changing
Organisms have the ability to adapt to a changing environment
Organisms that do not adapt do not survive

Environmental scanning

What environmental scanning can accomplish:
Helps organisation capitalise on early opportunities
Provides early signal of impending problems
Develops a customer oriented culture within an organisation
Provides a base of objective qualitative information about the environment that strategists can exploit
Provides intellectual stimulation to strategists
Improves image of organisation with its stakeholders

What to scan?
Political and Economic and Social and Technological

Examples of political trends and events:
Government legislation/policies
Political turmoil
Wars: Middle East, Iraq
Increase in political terrorism; revolutions
How do these events impact on an organisation and its stakeholders?

Decline of major powers; rise of emerging nations (China, India)
What marketing strategy implications does the emergence of firms from India (eg Tata) and China (Haier) have for Australian and New Zealand firms?



Examples of economic trends and events:
Depression; worldwide economic collapse
Increasing foreign ownership of U.S. economy
Increasing regulation and management of national economies
Several developing nations become superpowers (e.g., Brazil, India, China).
World food production: Famine relief vs. holistic management

Examples of economic trends and events:
Decline in real world growth; or stable growth
Collapse of world monetary system
High inflation
Worldwide free trade

Socialtrends with marketing significance:
Orientation toward time
Personal finance
Diversity of lifestyles

Orientation toward time

In modern society time is more scarce than money
Time saving is a necessary consideration

Australians have a high expectations of quality

Health concerns are a priority due to an ageing population, changing predispositions and education, these should be an important consideration for marketers

Debates re.carbon tax, plastic bags, climate change and other environmental issues.  More focus on re-using
Packaging and labelling should consider environmental considerations

Technology in homes, design and construction of houses etc. are all designed around entertainment in the home

Personal finance
Experts predict people will become more frugal in the future
Consumers seek out the best price/value before buying
Australian consumers are cautious with spending, post global financial crisis
Consumers willing to pay a premium for a quality product

Social environment
Diversity of lifestyles
More women in the workforce
Gay and lesbian couples more open than in past and increasingly reported data
Strong purchasing power for this segment.
More unmarried couples living together
Having children later, or not having children at all
More self-employed people than before
Greater ethical concerns

Technological environment
Can offerings be made more cheaply or to a better standard using  new technologies? Materials

Communication and information: rapid changes since 1990
What can your mobile phone do? How has that impacted on your needs as a consumer?
Which companies will this impact? How may it impact on consumers? Is there ethical issues to consider?

Structure of the Report
The report should be structured as a business report. However, you will need to consistently and comprehensively reference the sources of the information that you use throughout the document, using the Harvard referencing system.
Guidance regarding the structure broad structure of a business report can be found at http://www.flinders.edu.au/current-students/slc/whatweoffer/study-writing-guides.cfm
Your report should include
    Title page
    Executive summary
    Table of contents
    Body of the report
    Conclusions and recommendations
Executive Summary
1.    In the executive summary you can use a numbered list to summarise the key findings and recommendations of your report. This should be no more than 250 words in length, and ideally should fit on a single page.

1.    This states the purpose and structure of the report, and identifies the main theme or proposition(s) that you are trying to prove. It tells the reader what to expect.
1.    In the body of the report, you are trying to build a logical argument that supports the main theme or proposition. The body needs to be consistent with what you have said you are going to do in the introduction.
2.    Each paragraph should have a topic sentence, and the points you are making should reflect that topic sentence.
3.    You may need to refer to theory to analyse the topic you are discussing.
4.    Use theory and examples to explain your argument.
5.    Remember that you are trying to present a logical, cohesive and clear analysis of the key issues that you have identified, and to use these to support your proposition in a systematic way.

Conclusion and recommendations
1.    A conclusion is not just a list of the key points you have made. You need to draw together your key points to demonstrate that you have supported your theme or proven your proposition(s).
2.    Your recommendations in this section are more detailed than those included in the executive summary.
3.    The conclusion and recommendations need to be consistent with both the introduction and the body of the report.