Ryanair PESTLE Analysis

PESTLE is the acronym for political, environmental, social, technological, legal and environmental, and this tool, devoted to carry out analysis considering the external influences to an organisation’s activity, is of fundamental importance to properly develop a reliable strategy.

The political aspect of this tool considers the possible political influence on the strategy pursued by the organisation. For Ryanair this aspect has represented a considerable advantage, in that the European Union is a completely stable political region and the EU integration has allowed the carrier to expand its activity and routes. On the other hand of it, the airline is affected by the decisions posed by other political organisations like the OPEC, the organisation that unite the oil producer countries and that decide on the oil costs, determining its output quantity, distribution and global supply chain. The incredibly high cost of fuel has strongly affected Ryanair revenues, showing how the industry is particular sensitive to oil cost fluctuation.

The social environment is currently mainly characterised by demographic trends, particularly the ageing population and by changing consumers preferences, which are quite difficult to predict and are very much linked to the price of the service. The ageing population factor is likely to impact the travel industry in the next decade and to cause a shift in land transport, easier to access, to use and allowing movements from and to central town/city areas.
Another uncanny social trend is represented by the tendency to the “cocoon effect” every time a terrorism act is carried out, people, following events like these, prefer to avoid travelling and stay home. On the other hand of it, it is very likely that the younger generations are much more likely to use carriers for their travels and are the more and more