PESTEL Analysis of Google
Basically a pestle analysis is a form of evaluation that companies carry out to establish the current market conditions in important aspects such as political, economic, social, technological legal and environmental areas. The pestle analysis is then used for strategic planning and management.
For a technological giant like Google, the pestle analysis is very essential as their services touch on literally every aspect of the market conditions analyzed. The following are some of the important assessments that can be obtained from carrying out a pestle analysis for Google.
- Political factors. In examining the political factors, Google has to assess the political environment and its influence in information dissemination as well as technological services. This should cover tariffs and taxation as well as government regulations and restrictions. For instance, Google has in the recent past had to deal with political issues with countries such as China. This is due to the laws and regulations concerning access to sensitive information in China. Google is still dealing with censorship issues and has even lost market to a major Chinese search engine called Baidu. Such political factors can prevent Google from thriving in certain countries.
- Economic factors. Most companies are usually affected by economic factors and Google is not an exception. Inflation rates, economic growth, tax regulations, interest and exchange rates can all fall under economic assessments. For a labor intensive venture, economic problems can trickle down to employment issues. Yet Google has not experienced any stagnation despite the recent economic upheavals in US and other countries. As for tax concerns, Google is still in discussions with France over alleged tax noncompliance.
- Social factors. These encompass the cultural, safety and social groups that popularly use technological services. For example in China, Google users were found to be mainly between 18 and 24 years of age. Most of these users were well educated and situated in urban areas and also of a higher social class. The safety of these users has to be considered and Google thus has to constantly implement measures that protect its users in accordance with the local regulations.
- Technological factors. This covers areas such as research and development as well as automation and making changes in the technological area. As a technology giant company, Google invests heavily in research and development and implements several changes to satisfy its huge clientele base. This affects new entrants in the technological service market as they can hardly compete with Google.
- Labor laws and regulations. There are many laws and regulations that govern information and technology sectors. Google has to comply with these laws and regulations. These may include laws that restrict technological services or those that govern tax payments. The French tax compliance case against Google is one such regulatory factor that the company has to deal with.
- Environmental factors. Within the technological sector, the environmental factors mainly affect the users and their safety. Google has to ensure that its users are protected from fraudsters, hackers and other internet hazards.
In conclusion, Google has created a niche for itself in the technological sector. Despite the economic challenges that have faced most countries and companies in the recent times, Google‘s growth has not slowed down. The company has to deal with the regulation compliance problems that are a big obstacle to its growth and market access.
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