Srategic Management

Instructor: Sir Laurence P. Manaois

PESTEL ANALYSIS
OF SHOPEE
 POLITICAL FACTORS
E-business has different obstacles than traditional business does.
However, the e-retail industry is adversely affected by a number of risk
concerns. Numerous political factors have an impact on Shopee. First, the
tax policy is still complicated in e-business, particularly for products that
are exported. It is challenging for both the government and business to
deal with such issues. In general, the government finds it difficult to
regulate e-business. If it has not been completed, businesses will have less
assurance and the government will have stable taxes.
 ECONOMIC FACTORS
Economic factors consistently have a significant impact on the
state of the market and its dynamics. Improved and increased sales
and profit are also linked with ideal market conditions. Shopee
acknowledges that development is happening quickly and that as
people's incomes increase, so does their standard of living. Even in
this rapidly expanding economy, e-commerce still makes up a very
small part.
 SOCIAL FACTORS
Trends in society and culture also affect how fast e-commerce is expanding.
Customers have provided buying things online with a lot of positive comments in
recent years. Technology plays a huge role in society; many people have learned to
use it and shop online. Shopee offered numerous coupons for free delivery and
product discounts in exchange for their promise that every consumer would have a
positive experience. Shopee initially had trouble since customers insisted on seeing
the product in person before making a purchase and were unwilling to pay shipping
costs. Thus, Shopee modified their approach, and over time, particularly in the
Philippines, Shopee emerged as the top ecommerce business
 TECHNOLOGICAL FACTORS

The role of technology is essential. One may argue that

technological innovation is the secret to success in the
current period. Shopee implements several strategies such
as social media marketing, smart payment software for sale
promotion, image-based product search, and more to their
advantage.
 ENVIRONMENTAL FACTORS

Sustainability has emerged as a critical concern for businesses worldwide.

Even though e-commerce consumes fewer resources than traditional retail, it
still uses plastics and fossil fuels for shipping and packaging. Shopee switches
to paper boxes that preserve both the ecology and the form of the products in
place of plastic bags. Environmental conservation initiatives, such as the "Live
green with Shopee" minigame, are offered to promote waste-free lifestyles.
Shopee is undoubtedly making this expenditure in an attempt to gain total
independence from renewable energy sources over time.
 LEGAL FACTORS
Legal is always a big part that every business has to obey and do
seriously. Shopee belongs to the SEA group founded in Singapore and
so, itself has a separate legal team to oversee the legal issues and
challenges. Any struggle with law can be costly for Shopee. Any
mistake can result in a big fire or loss of image. Shopee has to be always
careful with legal challenges. To expand more markets, Shopee also
need to face more and more pressure from international law so they
have to remain cautious.
 COMPETITIVE
FORCES OF SHOPEE
 PORTER’S FIVE FORCES
Threats of Bargaining Power Bargaining Power
New Entrants of Suppliers of Buyers
The risk of new competitors entering the e-
commerce market is low to moderate for both When Shopee Live launched in
Shopee and the industry as a whole. This March 2019, it gained a lot of
could be because starting an e-commerce THE BARGAINING
popularity and established rules in
platform requires a substantial financial
commissions, which reduced the
POWER OF BUYERS IS
investment due to the high costs of LOW SINCE SUPPLIERS
technology, talent or human resources, and bargaining power. As for the
marketing. Since it would take months or sellers, they still tend to choose HAVE ALREADY SET
years for a new business to match Shopee's
Shopee despite the limited space PRICES OF MOST
level of investment in warehouses, shipping,
distribution, marketing, and other areas, new for negotiation because to its PRODUCTS. .
competitors face major obstacles. popularity and low barriers to
entry.
 PORTER’S FIVE FORCES
Threats of Competitive
Substitute Rivalry
Customers can compare With a high market share, Shopee
live is the most outstanding of all.
the prices on different Social platforms can reach much
platforms before buying. more potential customers, and the
Shopee make sure that functions of shopping guides in them
are relatively complete. Shopee live
their product are more has been steadily growing since it
affordable and a lot of launched..
discount.
Thank you