Don't Just Run a PESTEL: Your Industry Is a Moving Target

What's the best way to analyze market trends in my industry?

If you're trying to figure out where your market is heading, you've probably been told to run a PESTEL analysis and call it a day. That's a start, but it's not enough. The global insights industry—the very business of analyzing markets—is growing at a breakneck pace, and the tools you use to understand it need to be just as dynamic. Here's the blunt truth: if you're not combining external trend-spotting with a hard look at competitive forces, you're flying blind.

The world is changing faster than your analysis

Consider this: the global insights industry, which includes market research, research software, and reporting, was estimated to have surpassed US$140 billion in 2023 and was expected to surpass US$150 billion by the end of 2024 (ESOMAR via Research World). By 2025, it's projected to blow past US$160 billion (ESOMAR via Research World (GMR 2025)). That's not a slow creep; that's a rocket ship. Meanwhile, the US Bureau of Labor Statistics projects employment of market research analysts to grow 7% from 2024 to 2034, much faster than the average for all occupations (Bureau of Labor Statistics (OOH)). If you're in any industry that relies on understanding customers—and that's all of them—you need to be tracking these macro shifts with a tool that captures the whole picture.

PESTEL is your lens, but Porter is your map

PESTEL analysis gives you the big-picture external factors: political, economic, social, technological, legal, and environmental (Washington State University Libraries). It's how you spot the winds of change. But here's the catch: those winds don't matter if you don't know how they'll reshape the competitive landscape. That's where Porter's Five Forces comes in. As the CFA Institute points out, you should use both—Porter to interpret the competitive environment and PESTEL to understand external trends (CFA Institute).

Take the technological factor, for example. Nearly half of researchers globally use AI regularly in market research, and 83% of market research professionals planned to invest in AI in 2025 (Similarweb / Research and Markets). That's a technological shift that's already altering the competitive dynamics of the insights industry. The research software sector grew about 11.5% in 2024, while the mature market research sector grew only 4.8% (ESOMAR via Research World (GMR 2025)). If you're a traditional market research firm, that's a direct threat from substitutes and new entrants. A PESTEL analysis alone would tell you AI is trending; Porter's Five Forces tells you that AI-powered tools are eating your lunch.

The counter-argument: 'But Porter is too static'

You might be thinking: "Porter's Five Forces was developed in 1979; it's outdated." Fair point. The framework has been criticized for being a snapshot in time. But here's the thing: Porter himself updated it in 2008, and it's still the gold standard for understanding industry profitability (Harvard Business Review (Porter 2008)). The five forces—threat of new entrants, bargaining power of suppliers and buyers, threat of substitutes, and competitive rivalry—determine how the economic value an industry creates is apportioned (Harvard Business Review (Porter 2008)). That's as relevant today as it was four decades ago. The framework isn't static; you just need to refresh it with current data. For instance, in 2024, the US digital advertising market hit a record $258.6 billion, up 14.9% year over year (IAB/PwC Internet Advertising Revenue Report). That's a substitute for traditional market research in many ways, and it's a force you can't ignore.

Your industry is not a monolith: strategic groups matter

Here's where most analysts screw up: they treat their industry as one big blob. But within any industry, there are strategic groups—sets of firms that follow similar competitive approaches (Mastering Strategic Management (open textbook)). Your closest competitors are in your own group, but other groups reveal alternative paths to success, and gaps in the map can reveal untapped niches (Mastering Strategic Management (open textbook)).

Let's put some numbers on this. In the global insights industry, 2023 data shows Asia Pacific was the fastest-growing region at about 9.5% growth, compared to 8.0% globally (ESOMAR via Research World (Asia Pacific)). Within that region, Kazakhstan's market research market grew almost 24%, Vietnam 17.2%, and India 14.8% (ESOMAR via Research World (Asia Pacific)). If you're a US-based firm looking to expand, you don't just look at the whole APAC region; you identify which strategic group—which country, which client sector—is growing fastest. That's the nuance strategic group mapping gives you.

Put it together: a practical example

Let's say you run a small market research firm specializing in consumer non-durables. A PESTEL analysis would flag the rise of AI and the growing importance of sustainability. Porter's Five Forces would tell you that the threat of substitutes is high—clients can use DIY survey tools or even social media listening. But strategic group mapping shows that within consumer non-durables, five countries—the USA, the UK, India, France, and China—concentrated about 69% of the sector's total market research revenue in 2023 (ESOMAR via Research World (client trends)). That means if you're not in those markets, you're missing the bulk of the money. And if you're thinking about diversification, the Ansoff matrix shows that market penetration is the most-used growth strategy at 54.1%, but product development is only 19.8% (Duke University CMO Survey). That tells you where the opportunity is—and where the competition is fierce.

Don't get stuck in the middle

Finally, a word on strategy. Michael Porter famously said that strategy is as much about deciding what a firm is not going to do as it is about what it will do (University of Central Florida Pressbooks). If you try to be everything to everyone, you'll get stuck in the middle—offering neither unique features nor competitive pricing (University of Central Florida Pressbooks). In a fast-growing market like this, that's a death sentence. You need to pick a lane: be the low-cost provider, or differentiate on quality and service. The value chain analysis can help you find where to cut costs or add value (IBM Think).

Bottom line

If you want to ride the wave of market trends, stop doing static PESTEL-only analyses. Combine PESTEL with Porter's Five Forces, map your strategic groups, and refresh your data annually. The single best move you can make right now is to invest in understanding how AI is reshaping your competitive landscape—and adjust your strategy before your competitors do.

Sources

• CFA Institute - https://www.cfainstitute.org/insights/professional-learning/refresher-readings/2026/industry-and-competitive-analysis
• ESOMAR via Research World (GMR 2025) - https://researchworld.com/articles/inside-the-153bn-insights-industry
• Harvard Business Review (Porter 2008) - https://hbr.org/2008/01/the-five-competitive-forces-that-shape-strategy
• Mastering Strategic Management - https://saylordotorg.github.io/text_mastering-strategic-management/s07-04-mapping-strategic-groups.html
• Similarweb / Research and Markets - https://www.similarweb.com/blog/research/market-research/market-research-stats/
• Bureau of Labor Statistics (OOH) - https://www.bls.gov/ooh/business-and-financial/market-research-analysts.htm