A trend break could be a value shift in society, a technological innovation that might be permanent, or a paradigm change. Issues are less deep-seated and can be "a temporary short-lived reaction to a social phenomenon".
Marketing managers are confronted with many environmental concerns, such as those posed by technology, customers and competitors, ethics and law, the economy, politics, demographics, and social trends. All organizations should continuously appraise their situation and adjust their strategy to adapt to the environment.
One technique used by organizations to monitor the environment is known as environmental scanning. This term refers to activities directed toward obtaining information about events and trends that occur outside the organization and that can influence the organization's decision making.
In a sense, such data collection scanning acts as an early warning system for the organization. It allows marketers to understand the current state of the environment so that the organization can predict trends.
Issues are often forerunners of trend breaks. A trend break could be a value shift in society, a technological innovation that might be permanent, or a paradigm change. Issues are less deep-seated and can be "a temporary short-lived reaction to a social phenomenon. " A trend can be defined as an "environmental phenomenon that has adopted a structural character".
A formal but simple strategic information scanning system can enhance the effectiveness of the organization's environmental scanning efforts. An information system (part of marketing research) organizes the scanning effort so that information related to specific situations can be more readily obtained and used.
There are a number of common approaches for how the external factors, which describe the macro environment, can be identified and examined. These factors indirectly affect the organization but cannot be controlled by it. One approach is the PEST analysis.
PEST stands for political, economic, social, and technological. Of the four categories explored in the PEST analysis, the company has the least control over economic factors.
Two more factors, the environmental and legal factors, are defined within the PESTEL analysis (or PESTLE analysis).
The segmentation of the macro environment according to the six presented factors of the PESTEL analysis is the starting point of the global environmental analysis.
The six environmental factors of the PESTEL analysis are the following:
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