Bvlgari PESTLE Analysis

Published by MBA Skool Team, Last Updated: March 29, 2021

Bvlgari PESTLE Analysis assesses the brand on its business tactics across various parameters. PESTLE Analysis of Bvlgari 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 Bvlgari, as it helps them to better understand market dynamics & improve their business continuously. PESTLE analysis is also referred to as PESTEL analysis.

Let us start the Bvlgari PESTLE Analysis:

Political Factors:

The political factors in the Bvlgari PESTLE Analysis can be explained as follows:

Bvlgari is one of the oldest Italian jewelry houses manufacturing watches, fragrances, accessories and leather goods. It is a very famous International brand. It has around 230 retail locations worldwide. A number of different political factors in different countries influence the operating business of Bvlgari. Factors such as government policy, political stability, corruption, taxes and duties, trade rules and restrictions impact the operations and strategy making process for the company. The government FDI policies, tax rates, risk factors set up in the lifestyle and retail sector has a major impact on the sales of its various products in different categories. The government’s on promoting local made products can have a negative impact on brands like Bvlgari. It can turn this threat into an opportunity by leveraging the government initiatives and support.

Image: Wikimedia

Economic Factors:

Below are the economic factors in the PESTLE Analysis of Bvlgari:

Bvlgari being a luxury brand gets impacted by a lot of economic factors both at micro and macro level.

The income level, rising prices and inflation impacts the disposable income of consumers. The consumer spending gets affected by the macro environmental conditions at global level as well. Like the coronavirus pandemic worldwide lockdown had a huge negative impact on the sales of this brand. People spent less on luxury and non-essential items because of less available disposable income at their end. But with the improved situation this brand again holds an opportunity in emerging economies to strongly hold itself as a market leader.

Social Factors:

Following are the social factors impacting Bvlgari PESTLE Analysis:

Society has a major role to play in influencing the buying decisions for luxury and retail products. For Bvlgari it is important to segment its market accordingly for targeting and positioning itself and its offerings accordingly. The demographics such as age, gender, education level, location, employment etc. impacts the choices and the consumer spending decisions. Youngsters and women usually prefer luxury items such as watches, perfumes and jewellery etc. Bvlgari has an opportunity here to attract its target market with changing lifestyle preferences and adapt itself accordingly. It can attract different market segments and fulfill their looked after demands and needs.

Technological Factors:

The technological factors in the PESTLE Analysis of Bvlgari are mentioned below:

Technology has a role to play in the luxury products today. Bvlgari is leveraging high technological innovation in its products like watches with smart features such as car door unlocking, payment and many more. This brand has the NFC technology embedded into its products like bags and wallets as well as its own Bulgari Vault app which allows the safe storage of personal digital data. It has its own patented tubogas technology which offers it a competitive advantage over other competitors. It also takes into consideration the use of VR technology and blockchain for its processes and operations. The brand has also launched its products on E-commerce platforms for selling in almost seven countries.

These factors influence customer’s purchasing decisions and make the brand profitable with high sales.

Following are the legal factors in the Bvlgari PESTLE Analysis:

The legal factors are very important to be considered for the luxury and retail sector. A number of legal rules and regulations such as product labeling and product safety, consumer rights and laws, tax and export restrictions, copyrights, patents, health and safety etc. should be considered by luxury brand Bvlgari. For this brand it is important to follow all legal factors for its business operations and overall strategies. Even the workers’ rights, their labour laws for wages and right work environment should be maintained in all operating countries. The marketing and advertising standard regulations should be kept in legal order with rightful ethics. Consumer data protection laws should be legally respected and its privacy should not be hampered in any illegal manner. This makes the business of Bvlgari grow in different countries with high sales and profitability.

Environmental Factors:

In the Bvlgari PESTLE Analysis, the environmental elements affecting its business are as below:

The environmental factors are really important for any brand to showcase its unique value to its customers. It is important for Bulgari to decrease its carbon footprints and become environment conscious.

This brand needs to strategize taking all eco-friendly steps in its processes, raw materials, packaging and operations. Environment and sustainability are imperative today for any luxury and retail sector to get an edge over and above its competitors. As customers today are becoming more environment conscious, it’s important from Bvlgari to consider this in their business formulation.

To conclude, the above Bvlgari 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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