Published by MBA Skool Team, Last Updated: March 07, 2021
PESTLE Analysis of Valentino analyses the brand on its business tactics. Valentino 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 Valentino, as it helps to understand market dynamics & improve its business continuously. PESTLE analysis is also referred to as PESTEL analysis.
Let us start the Valentino PESTLE Analysis:
The political factors in the Valentino PESTLE Analysis can be explained as follows:
An Italian luxury fashion house, Valentino s.p.a. was founded in 1960 With its headquarters in Milan and the creative direction in Rome. Various political factors like imports from different countries and demand from different countries would be some the political factors that could affect the brand. Exporting can also be one of the major factors that luxury brand like Valentino may face as Government regulations differ from one country to another. the taxation rates and changes in taxation policies may affect the business performance of the brand very often. intellectual property protection is also one of the factors that directly influences the profitability of the brand. Political stability in a country is a very good indicator for the brand and could help it flourish in the future. Hence political factors must be taking care of for analysis and efficient business operations.
Below are the economic factors in the PESTLE Analysis of Valentino:
A luxury brand like Valentino would bloom with the economic development of the country.
This is because growing economies would create more demand for such luxurious products. This is because with the rise in income of people their willingness to pay will increase for luxury items. factors like exchange rate, interest rates, employment rates and inflation rates maybe some other factors that have a huge impact on the company. fluctuations in exchange rate good prove to be a disadvantage for the company. Inflation rate also has a great impact on the long-term opportunities. higher unemployment in a country would lead to cheaper labor but on the other hand it would also mean lesser people would be willing to invest in luxuries. the rate of interest on savings and on loans could also have an impact on purchase of such goods. this is because if interest on savings is more people would rather invest in savings and if interest on loans is lower people would be willing to take loans and invest on luxuries. This is why factors play a major role in determining profits for the company.
Following are the social factors impacting Valentino PESTLE Analysis:
Consumer preferences in the fashion industry could vary to a great extent. Analysis of demographic patterns would be really helpful for the company to create segments and serve its customers well. They could also be pressures from the consumers or the government based on the levels are social concerns and awareness in the society hence the Valentino company must be ready to handle such scenarios and come out of them efficiently. the gender plays a major role in determining the inventory for the company. as the company customize its clothes the latest trends must be well known and strategies must be taken to serve a greater number of customers. Niche marketing strategies would have to be adopted by the company as the cultural traditions of people also determine their preferences. Hence studying of buying behaviors will help the brand to serve its customers better.
The technological factors in the PESTLE Analysis of Valentino are mentioned below:
When it comes to the technological factors luxury clothing brand must have the little latest designs and clothes spinning machines in order to deliver best quality. To have information about the same the brand must invest in research and development to segregate between the technologies that are required by the firm and the ones that are not. This is because technology is evolving at a very fast pace today and if a company tries to adapt to all the latest technologies it might just end up increasing its costs. This would also keep the Valentino company updated and ready for the upcoming changes, so that modifications in the infrastructure and the business models are also possible when required. The system of logistics that the company uses must be well designed and suit the requirements of the company.
Measures to should be taken such that the billing times can be reduced, delivery time can be reduced, alteration time can be reduced.
Following are the legal factors in the Valentino PESTLE Analysis:
Every government has a set of rules and regulations that support the industrial development of their country and hence measures should be taken which are not only beneficial for the company but also for the citizens of the country. There are also laws in place which are to be abided by to stay away from any legal charges or lawsuits. The trade practices maybe restrictive not only to protect the consumers but also protecting the company depending on the competition in the industry. The intellectual property laws of different nations are also in place to protect the Valentino company’s ideas and patents. This is very necessary in the industry in order to maintain the competitive edge against the market players. Any legal charges would also lead to the company losing a lot of time and money on the same and hence must take care of these legal factors associated with the industry. Part from this consumer protection laws and employee protection laws are also in place to protect the consumers from being cheated by the firm and to protect employees by ensuring a good working environment for them.
In the Valentino PESTLE Analysis, the environmental elements affecting its business are as below:
Search luxurious brands have customers that look around every single thing involved in the process of their goods being produced. People are more eco-friendly today and tend to prefer brands that are earth friendly and have very less carbon footprint as compared to the industry.
Hence billing systems must be done with either recyclable paper or done through the online mode, usage of plastic must be reduced to the maximum extent possible and the Valentino company should also try and adopt to renewable sources of energy which shall enable them to sustain in the long run even when non-renewable sources of energy suffer depletion. The environmental factors that could affect the demand for certain products could be climate change or change in weather conditions. This is because the the cost of best quality raw materials may vary according to the conditions.
To conclude, the above Valentino 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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