DESTEP analysis

Also called: PEST analysis

The DESTEP analysis is a marketing model used to map an organization's macro environment. The letters DESTEP therefore stand for the factors on which this analysis focuses. Indeed, this analysis focuses on the demographic-, economic-, socio-cultural-, technological-, ecological- and political-legal environmental factors. Although these environmental factors affect an organization "only" in an indirect way, it is important to understand them. After all, these factors represent external opportunities and threats. Therefore, these factors are certainly very important for the success of an organization.

The DESTEP analysis is shaped by focusing and investigating the external environmental factors listed below.

• Demographic environmental factors refer to such things as the composition of the target population. This can include factors such as the growth, gender, age, education level and size of this group of people.
• Economic factors refer to such things as purchasing power, the unemployment rate, average disposable income and inflation. With these economic factors, it is important not only to look at the current situation but also to consider the expected changes in this area.
• Sociocultural factors relate to things such as the lifestyle of the target group, the behavior of this group of people, the norms and values that prevail, religious beliefs and social media use.
• Technological factors refer to things such as technological developments, the digitization of society, trends and innovations. Even with these factors, it is important to consider, in part, expected technological developments.
• Ecological factors refer to issues such as environmental influences, nature, climate, weather and waste disposal.
• Political legal factors relate to issues such as legislation, privacy rules, tax rates, import and export rights and/or political influences.

Application of the DESTEP analysis

This above breakdown of opportunities and threats forms the basis of a SWOT analysis and the confrontation matrix. The whole of these three studies offer an insight into which areas are still profitable for a company and what the obstructing factors in this are. This insight can form the basis for shaping a short- or long-term strategy. It is of course very important that reliable sources are consulted to shape the DESTEP analysis to avoid the use of assumptions.