Published by MBA Skool Team, Last Updated: December 25, 2019
PESTLE Analysis of Maggi analyses the brand on its business tactics. Maggi PESTLE Analysis examines the various external factors like political, economic, social, technological (PEST) which impacts its business along with legal & environmental factors. The PESTLE Analysis highlights the different extrinsic scenarios which impact the business of the brand.
PESTLE analysis is a framework which is imperative for companies such as Maggi, as it helps to understand market dynamics & improve its business continuously. PESTLE analysis is also referred to as PESTEL analysis.
The political factors in the Maggi PESTLE Analysis can be explained as follows:
Maggi is one of the leading food & snack brand in the world. The trade relationships of countries with each other is critical. The better the relations, easier it would be for the firms to perform business across the world, internationally. In 21st century every one wants to go international. Nestle is an already established brand across the world. USA is Nestle’s major market for Maggi. The trade war that is going on with China and USA effects the exports and imports in both the countries due to increased rates of imports and exports. Since Maggi is a brand which has its presence all over the world, the respective country’s political stability is important in determining the supply chain efficiency. The Brexit also effected Maggi and its sale in in UK. The import rates had gone up since the pound lost its value in international market after Brexit. Overall political stability is utmost necessary to run a smooth business.
Below are the economic factors in the PESTLE Analysis of Maggi:
Maggi is food brand which is present all over the world and hence is dependent on several economic factors.
It is a very known phenomenon that political tensions between countries raises economic tensions as well. The Brexit for example led to the downfall of the pound value in the international market. This increased the rates of imports of raw materials. The whole supply chain of brand like Maggi gets disrupted and thus the production goes for a toss. Events like global recession cuts down the income of people. With less income, people lose on their money spending capacity. Thus, the overall sale reduces. Customer is becoming cost conscious and thus economic stability in the international market is important.
Following are the social factors impacting Maggi PESTLE Analysis:
The taste preferences of people vary from place to place. Thus, Nestle’s Maggi has to be marketed considering the specific taste demands in different regions. The marketing efforts should also be aligned. Customer these days are opting for healthier food items. They look for more nutrients in the food that they consume, even if it’s a snacks item. With hectic work life people these days find it tough to manage home and office. On returning back to home, they need items like Maggi that get prepared quickly, consuming very little time. Social campaigns should also consider the socioeconomic factors.
The technological factors in the PESTLE Analysis of Maggi are mentioned below:
Technology advancements are penetrating in every department of the firm. In manufacturing technology is used to maintain manufacturing precision, in supply chain it is used to achieve target efficiency, to control the quality of product, in sales and marketing to reach out to maximum number of people. Usage of internet has grown immensely in this decade. Online shopping is a boon for products like Maggi.
Social media is a major technology development for nestle and its customers to connect with itself.
Following are the legal factors in the Maggi PESTLE Analysis:
The food industry has always been under the scanner of the respective governments and their regulations. These regulations are strict in comparison to other industry since here the products are consumed by customers in their diet. Compliance is necessary to avoid the bulky fines. Like in India Maggi had legal issues for using lead amount in Maggi more than permitted level. The whole market lot had to be called back. Apart from these laws the labor and environment laws are strict as well. Any new product which is developed has to be protected by copyright so that its competitors don’t copy it.
In the Maggi PESTLE Analysis, the environmental elements affecting its business are as below:
Nestle as a company focuses on saving the environment. Protecting environment these days has not only governments agenda but even the firms take it up seriously and under their CSR wing they work dedicatedly towards it.
This helps brands like Nestle & Maggi from breaking any law and also maintain goof image in the eyes of the people. There are laws to prevent exploitation of water bodies for business output maximization. The waste disposal in these water bodies and air is regulated by specific laws.
To conclude, the above Maggi PESTLE Analysis highlights the various elements which impact its business performance. This understanding helps to evaluate the criticality of external business factors for any brand.
This article has been researched & authored by the Content & Research Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.
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