Question

It was established in 1971 as the only newspaper in the country. At the time, the company had virtually no competition. It had a strong financial base with many readers cut across the length and breadth of the country. It was able to engage the best of journalists to work for the brand, a development which has made the company extremely formidable thus, it became a household name.

After 50 years in operation as a media enterprise, the board of APPOT Communications Group Limited (ACGL) is faced with a lot of competition from online news portals, the proliferation of radio and television networks as well as new newspapers that hit the stands on a daily basis.
This development has affected the market share of APPOTS Communications Group Limited. From 90 per cent, today, the market share of the company has dropped to just about 43 per cent and still falling.
As the new Managing Director of the company, your task is to turn around the business to restore it to its former glory.

Indicate the relevance of PESTLE analysis as a framework to analyse some of the key factors that can influence the strategic plan of the company going forward.

Answer 1

PESTEL Analysis-

PESTEL Analysis provides the strategic framework for the analysis of all components which have impact on the functioning of the business.

According to the given case, Market share of the media company has reduced from 90% to 43%. As the new Managing Director of the company, my task is to turn around the business to restore it to its former glory. For this, we have to analyse the PESTEL Analysis of the company which is as follows-

1. Political Analysis- There is a impact of political parties , their policies , rules and regulations on every company. On media industry, there is a huge impact of the political parties as media demand news and there is a flood of news of political parties. As if my company will focus on the upcoming topics of the political party, then we will provide the latest news to our customer and will be able to beat our competitor and can increase their market share back to 90% from 43%.

2.Economic Analysis- Economic components includes fiscal policy, taxation policy, monetary policy etc. These have impact on the functioning of the business of media industry also.

3. Social Analysis- This factor constitutes demographic component. Media industry should provide news of such type which can focus on the demographic dividend. Like- Age composition, Gender-composition, income, interest, their needs, purchasing power. What is the interest of different segments of society in what kind of topic that a media industry should focus on to increase its market share.

4. Technological Analysis- Technology is an application of scientific knowledge to the practical task. Various technologies and up gradations have impact on the business scenario. Research and Development, innovation etc provides various opportunities to the business. Online platform is the result of technological innovation. This provide better opportunity to media-user like they can have information and news on different apps on their phones.

5. Environmental Analysis- Environment means scanning. It is the combination of various micro and macro factors which affects the functioning of the business. These have impact on the strategic framework of the business for the development of counter strategies to beat the competitor.

6. Legal Analysis- Legal factors pertain to any legal forces that define what a business can or cannot do.

Legal factors include the following:

Industry Regulation

Licenses & Permits

Intellectual Property: