Political, Economic, Social, and Technological analysis (PEST) Is used to look at the broader picture in relation to a business project. Looking at what is going on around you is vital to starting or maintaing a successful business. As a freelance designer it is obvious you need to keep up with the latest technology as computers have revolutionised how designers work in the last 20 years. It is important to look out for new technology in the pipeline that may impact on the way we work in the future. Political factors can effect the success of a small business as tax rates and the availability of grants will make an impact on profitability. Economic factors can effect a freelances ability to find work, for example in a recession there is less demand for graphic design as some businesses are financially stretched and cant afford this service. Currency exchange rates can effect the value of oversees work in relation to GBP if you are paid in the local currency. Social factors that would effect my freelance work would be understanding cultural differences if my work is to be used overseas. Language barriers can also an issue for international work.
Market segmentation is important to understand so you can effectively target your business at potential customers. Understand the needs of different market segments lets you define a clear market to target your work at. This could be very useful for a graphic designer that wants to attract more clients in one particular industry or income level for example. Understanding the behavior and values of good clients will help target other potential clients in the same segment of the market. To advertise effectively you need to be sure the customers you are targeting will engage with the medium you have chosen, will they be reading the magazine or website you have advertised in?
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