PEST(EL) analysis, also known as STEP analysis, is a frequently applied strategy tool used to analyze external environmental factors. The purpose of the analysis is to keep a constant eye on the general conditions influencing the market in order to be able to make well-founded strategic decisions at any time. "PESTEL" is the abbreviation for the relevant and observable market factors in English: Political, Economical, Social, Technological, and in extension of the previously used "PEST" or "STEP analysis" now also the factors Ecological and Legal. When applying the analysis, particular attention is paid to the areas relevant to the company. The "Legal" factor is particularly important in the legal services market. When analyzing the factors relevant to a company in this market, legal restrictions for marketing activities become apparent on the one hand, but also legal framework conditions affecting the overall population. These in turn contain interesting opportunities for the marketing of one's own company. The insights gained through the PESTEL analysis should be incorporated into the so-called SWOT analysis (Kerth et al., 2015).
PESTEL (Cambridge, 2019)