PESTEL analysis refers to a framework or a tool that the marketers use to help them analyze and as well as monitor their external marketing environment and the impact of those macro-environmental factors on their organization. The results that are gotten after the analysis are then used in the identification of weaknesses and threats which are used in SWOT analysis. PESTEL analysis includes social factors, legal factors, environmental factors, technological factors, political factors and the economic factors. The PESTLE analysis of this essay will be conducted on YouTube which is an international media company that is owned by Google. YouTube is one of the global media organization that is used to share videos which are of all types of genres. It is a social network where people not only upload and A PESTEL analysis refers to a framework or a tool that the marketers use to help them analyze and as well as monitor their external marketing environment and the impact of those macro-environmental factors on their organization. The results that are gotten after the analysis are then used in the identification of weaknesses and threats which are employed in SWOT analysis. PESTEL analysis includes social factors, legal factors, environmental factors, technological factors, political factors and the economic factors. The PESTLE analysis of this essay will be conducted on YouTube which is an international media company that is owned by Google. YouTube is one of the global media organization that is used to share videos which are of all types of genres. It is a social network where people not only upload and download videos but also interact across the world.
Political factors
Political factors refer to the extent in which the government tends to intervene in the economy. Such factors can include the policies that have been set by the government, the instability or stability of the markets that are overseas, tax policy, environmental law, foreign trade policy, labor law and the restrictions that have been imposed on business. These factors have a great impact on an organization and how its operations are carried out. To be able to overcome the political factors an organization needs to be in a position to which it can respond to the current and as well as the future legislation which may be required. It should ensure that the marketing strategy that the organization is using is adjusted accordingly. YouTube which is a media that is owned by Google is profoundly affected by the political climate of a country. It is because when the political environment is not favorable, it becomes a challenge for an organization to generate sale and revenues which are high. YouTube has been affected by the government policies which have been set by various countries regarding the display of different content on the YouTube channels, and this has caused it to have a limit on their revenues. Various countries have set up very strict regulatory framework concerning what is watched on YouTube. Such countries include USA, France, Singapore, China, South Korea and Germany. A computer user who is in the USA can be imprisoned for either transmitting or even receiving pornographic materials. They have a Federal Bureau of investigation that was set up in the year 1993, and this has helped in the tracking of such issues. Through this YouTube users tend to be choosy on what they are watching and hence this makes the YouTube views to be much less than what the organization expects hence, in turn, this lowers their revenues. The implementation of various policies has led to some countries blocking YouTube due to the display of content that is offensive. Some of these countries which most are the members of GCC include Brazil, Libya, Thailand, Saudi Arabia, Pakistan, and, Iran. It has resulted to the organization incurring losses (Griffith, 2002).
The other area that YouTube has been used for is to reach a large number of masses during the period of politics so as to influence the people's political opinion and also engage the public. This has led to the outbreak of wars in various countries. People have used YouTube as a channel where they spread hate speech, and this has led to it being banned in different countries as a means of communication. In a Country like Turkey banned the use of YouTube with only a few days being left towards the municipal elections. It was intended to minimize the election leakage and also help in the reduction of the pre-election tension. YouTube was also blocked in Germany due to the GEMA and the YouTube over royalties disputes. On the other hand, it has increased its sales as American presidential and politicians in some other countries tend to hold their meetings on YouTube (Fox, 2012).
Technological factors
Technical factors can be used to refer to the new ways in which production, communication, and distribution take place. These factors have led to affecting the management and marketing of an organization. The manner in which the YouTube operations are managed highly depends on high technological integration so as to provide people with an experience which is of high quality by them using YouTube. The Google Inc. (2014) is a modern technology that is helping YouTube to be able to compete with its competitors in the marketing sector (Eisenmann, 2006).
It is important for an organization to be in a position to identify technological advancements in the industry that it is operating in so that it can also be part of the technological growth and development. In the case of YouTube new technology is used to help improve their quality of video sharing to their users and also enabling them to be able to access it despite the gadget that one is using. For example, the improvements that have been made on the video technology have been enhanced by the HTML5 that has led to people been in a position to efficiently use their devices to view videos on YouTube. The YouTube videos can easily be downloaded or even uploaded and at high speed due to the high technology that the management has implemented so as to be convenient to their customers. The administration has embarked on new technology which has changed the way people can create, consume and also share the videos. People are now using YouTube as a marketing platform for their businesses, and this has increased the organization's revenue significantly (Rowell, 2011).
Economic factors
The economic factors that are involved in the PESTEL analysis include the economic growth of a country, inflation rate, interest rates, exchange rates and the consumer disposable income. The economic factors can be divided further into the micro and macroeconomic factors. The economic forces tend to shape the future growth prospects of an organization. The peoples income tends to determine how much they use the internet. When the economy of the country goes down people, tend to be selective in the manner and the purpose they use the internet (World Bank research program, 1999). In this case, the use of YouTube will be affected negatively by such an economy as people may not use it so much for the purpose of entertaining them as compared to when the economy of the country is good and growing (Burgess and Green, 2009). It will lead to the reduction of the organization's profit. Where the inflation rate of the country is high people tend to be left with a little amount of money to use on entertainment channels such as YouTube hence the revenue of the organization will in turn reduce. In some GCC countries like India whose economy is stable, they have led to the massive growth of YouTube. This is because in India there are over 300 million people who use smartphones and hence they are in a position to easily access YouTube. People who view YouTube in India using mobile phones have reached to over 180 million, and this means more income for the YouTube organization. It is possible due to the stability of the economy of India. India is one of the countries that have a great currency exchange this is according to a report that was given by world bank (Rama Rao, 1982).Economic stability tends to have a positive impact on the YouTube organization as more people in the population become users of the internet. Where a country has a high rate of taxation, the people tend to have a little amount to save and also use for leisure such as watching YouTube. It tends to reduce the income of the YouTube organization.
The Gross Domestic Product of a state is a factor which contributes to the carrying out of business on various websites such as YouTube. The states mostly the GCC countries which have a good economy, are developed and have a high Human Development Index its population is more likely to use the various internet sites and social networks such as being addicted to YouTube.
Social factors
The social factors are also referred to as the social cultural factors. These involve believes that the people have towards a particular subject. They include the distribution of age, the population growth rate, health and the attitude of the community on a career. The various culture plays a role of YouTube which is considered as global media which can be accessed by all types of people regardless of their age, tribe, religion, and gender. This diversity tends to pose a challenge towards the YouTube management and the organization as a whole (Worthington and Britton, 2015). The information that YouTube displays need to fulfill the needs of the different viewer's. The young generation is more prone to using YouTube as compared to the aged. YouTube being part of the social networking domain tends to offer an area where people can share their videos. The factors are of interest to the YouTube management as it helps them understand their customers and what drives them to watching YouTube (Alphabet Investor Relations, 2017).
Legal factors
The legal are those that are related to health and safety, the required standards for advertising, equal opportunities, the manner in which the products are labeled and rights as well as laws regarding the consumers. The online video sharing is regulated by the legal laws which include the copyright and the intellectual property laws. It is a challenge to the YouTube management as their organization is mostly for video sharing that all sorts of people can use and hence some members may end up uploading videos which violate the copyrights laws. The management of YouTube to be able to control such incidences should always ensure that they take action to remove such content. It is a challenge for them as well since the government and the telecommunication companies can formulate laws which will restrict YouTube It is to be able to control the illegal download of content from YouTube (Patent, trademark, and copyright laws, 2015). Violation of such laws may make YouTube incur extra costs through payment of fines and hence resulting in losses to the organization. The management should know what is legal so as to be able to transact with the YouTube users quickly. It may be a challenge for it being a global media organization different countries have set various legal rules and regulations, and this may result to YouTube ending up being banned from usage in such countries especially the GCC countries (Alphabet Investor Relations, 2017).
Environmental factors
The environmental factors that are involved in this analysis are the availability of raw materials, the population being targeted and operation of the business in a manner that is ethical. YouTube being operated by the Google Inc. company, the social business responsibilities of Google are also seen in the operation and as well as the management of YouTube. Google recently is using YouTube to help in the spread of their campaign about the conservatio...
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