DESTEP analysis is a model for assessing macro-environmental factors that is commonly used in strategic management, marketing and communications. It is used as part of an external environment analysis during market research and strategic analysis, and provides an overview of different macro-environmental factors that must be taken into consideration. This model is beneficial for understanding market trends, determining a business’s position, identifying potential opportunities, and determining the direction for future operations.
DESTEP stands for Demographic, Economic, Socio-cultural, Technological, Environmental, and Political factors, which are the six key areas that should be considered in the analysis.
Demographic factors refer to the characteristics of a population, such as age, gender, income, education, and occupation. This information can be used to identify target markets, and to understand the needs and preferences of different customer groups.
Economic factors refer to the overall state of the economy, including things like GDP, inflation, and unemployment. These factors can have a major impact on consumer spending patterns, and can also affect the availability of funding for a business.
Socio-cultural factors refer to the cultural, social and lifestyle trends, values and norms in the society. This includes things like consumer attitudes, beliefs, and behaviors, which can impact a business’s marketing efforts.
Technological factors refer to the advances in technology and their impact on the business. This includes new products, software, and equipment that can improve efficiency and productivity, as well as new communication methods that can be used to reach customers.
Environmental factors refer to the natural environment, including things like climate change, pollution, and natural resources. These factors can affect a business’s operations, and can also impact consumer attitudes and behaviors.
Political factors refer to the government policies, laws and regulations that can impact a business. This includes things like taxes, trade agreements, and laws related to labor, safety, and the environment.
In conclusion, a DESTEP analysis is a valuable tool for marketing students as it helps to identify and understand the various environmental factors that can impact a business. By considering these factors, businesses can make better decisions, anticipate changes, and develop effective marketing strategies. It’s important to note that the DESTEP analysis is not a one-time process, but should be continuously monitored and updated as the environment changes.
Variants
This model has a number of variants:
- PEST (political, economic, socio-cultural, technological) this is the original model as developed by Aguilar (1967).
- PESTEL or PESTLE, which adds legal and environmental factors to PEST.
- ETPS economic, technical, political and social.
- STEEPLE and STEEPLED, adding ethics and demographic factors.
- SPELIT, adding legal and intercultural factors. Intercultural factors considers collaboration in a global setting.
- STEER considers sociocultural, technological, economic, ecological, and regulatory factors, but does not specifically include political factors.
References
Aguilar, F. J. (1967). Scanning the business environment. Macmillan.