China PEST Analysis

Opportunities Threats
Political
  • China accepts foreign business
  • Ban on console games
  • Ban on certain online games
  • Censorship
Social and cultural
  • Many people are gamers in China
  • Huge population
  • Difference in culture between video gamers and online gamers
Economic
  • Third largest economy in the world
  • Growing economy
  • Japan Earthquake
  • Limited trade between China and Japan
Technological
  • Growing technology
  • Not all technology is allowed (consoles)
  • Not all areas in China have the latest technology since they are underdeveloped

Political:

China allows foreign businesses to enter. However, the government has issued policies that ban console games and certain online games. The restrictions set by the government could be troublesome since Square Enix’s main product line are video games. This would require Square Enix to readjust their main products, which is unrealistic.

Social and Cultural:

China has a lot of gamers in the country. This allows Square Enix to create products to target these customers since their main focus is on games. Also, since there is a huge population, there is surely to be enough potential customers willing to buy Square Enix’s products. However, because of the ban on console games, Square Enix will have to be able to adapt and understand the culture of online gamers in China.

Economic:

China has the third largest economy in the world and has a¬†continuously growing economy. This allows China to sustain itself and Square Enix will be able to expand into China. The earthquake in Japan has little influence over China. There will be limited trade between China and Japan, however, Japan is China’s top fifth destination for China to export their goods. This may lead to some products, such as clothing and electronic equipment, to not be traded as much. This will also may lead to harming China’s economy.

Technological:


Comments on this entry are closed.