International Marketing Environment - PEST Analysis

International Marketing Environment - Political Factors

Consider:

• The political system of the country you would like to trade in. For example is it a democracy, republic, monarchy, communism or a dictatorship? Will the political system affect how you trade in that country?
• The political stability of the country you would like to trade in. For example is there a stable government? Civil unrest? Is the country suffering from violence or terrorism? Is the political environment predictable?

International Marketing Environment - Economic (Related to the Country's Economy) Factors

Consider:

• Consumer wealth and expenditure within the country.
• Are quotas imposed on your product?
• Does the country have trade tariffs? and how will this impact on your business?
• Does the government offer subsidies to national businesses which could make it difficult for you to compete with national firms? Or are there grants and incentives available to overseas businesses like yours?
• Monetary policy of the country you would like to trade in. How does the monetary authority control the supply of money. Are national interests protected through interests rates and inflation rates.

International Marketing Environment - Social Factors

Consider:

• Language. Will language be a barrier to communication for you? Does the country you would like to trade in (host country)speak your national language? What is the meaning of your brand name in your host country’s language?
• Customs: what customs do you have to be aware of within the country? This is important. You need to make sure you do not offend while communicating your message.
• Social factors: What are the role of women and family within society?
• Religion: How does religion affect behaviour?
• Values: what are the values and attitudes of individuals within the market?

International Marketing Environment - Technological Factors

Consider:

• The technological infrastructure of the country you would like to trade in - Internet, telephone and other types of media
• How efficient is the internet infrastructure and information exchange services? What technology will you use to communicate between your firm's offices around the world?
• Do all homes have access to energy (electricity) so that they can access technology?
• How easy is it to access technology hardware such as laptops, servers and mobiles?
• How well will your Information Technology systems integrate with your host country's?

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Conclusion

When operating in foreign markets its very important to analyse the Macro environment through things like a PEST analysis as events are not happening around you. There will be customs and cultures that you are not accustomed to and values you may not agree with.

Ongoing PEST analysis will help you integrate your business into foreign markets and forecast change so that you mitigate threats and capitalise on opportunities (SWOT).