We are going to produce a PEST analysis to find out what external influences may be affecting the product (Milo) and to what extent to which customers decide to buy them. The purpose of the PEST analysis is to analyse the organization (Nestle Milo) operates and to identify how it may influence marketing decisions. A PEST analysis analyses the external environment in which an organization operates and identifies how it should influence marketing decisions.
The actions of governments can have major effects on business and markets, including creating or reducing demand for particular products and services.
Consumer spending may be controlled by a range of economic factors such as income levels, inflation, taxes, unemployment, and exchange rates and mortgage rates.
Social trends are important because they have a direct influence on the demand for particular types of product.
Development in technology gives rise to new products and market opportunities, e.g. the rapid growing use of computerized reservations systems.
* Exchange rates (what are they here/abroad, If you’re buying from another country and the rates differs, it changes the price you end up paying) Fall in value of sterling which makes exports cheaper and increases quantity of exports of milo. The geographical factor will increase with the prices of milo. It is because the transportation cost to East Malaysia is very high compare to West Malaysia.
* Taxes (if they go up so will the costs for consumers)
Higher milo prices reducing living standards.
Higher taxes of milo prices causing lower wealth and spending.
* Recession (people have less disposable income – would they buy Milo?) Lower real wages increase disposable income does not encourages milo’s consumer spending. Increased consumer confidence, which encourages spending the necessity produced such as milo.
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