PESTEL analysis is a marketing tool used byorganizations for analysis before launching of any new product or strategy toincrease the revenue of any existing product. The approach adopted in PESTELanalysis is study of various aspects such as political, social, economical andtechnological governing the product. The results are used in doing SWOTanalysis to ascertain the strength and weakness of the strategies to be adoptedby the management for successful marketing of the product. The method adoptedby Alibaba.com to study the political thinking in the country and related legalframework governing e-commerce business, which was at a nascent stage, howeverwas adopting fast changes to suit this new business avenue. The companyobserved that with the rapid economic growth, there were growing people havingInternet access who used the Internet to do online shopping.
Many people were speedingtheir monthly income on Tabaco, the largest B2C e-commerce website. In 2010,China’s online shopping industry had a turnover of $80 billion, and grew 87%year-on-year. China’s 420 million Internet users were spending around a billionhours each day online and 185 million made at least one online purchase. Thestudy revealed that According the volume was expected to increase fourfold by2015.
And E-commerce has already been changing the way Chinese consumers werethinking about shopping online. There was an element of more social than a hardsell. Accordingly, the company focused more on highlighting the socialimportance of the business.