In terms of political factors, in the Danish War of 1864, conflict arose over the duchies of Schleswig and Holstein. Bismarck allied with Austria and defeated the Danes. Bismarck cunningly planned that Austria receive Holstein while Prussia receive Schleswig, anticipating that this would create tension in the future and potentially provide a reason to go to war against Austria. Bismarck knew that in order to achieve German unification, Austria would have to be isolated from German affairs or, less likely, be willing to accept Prussian domination of Germany. This political move would ensure a motive for potential war against Austria by creating friction between Austria and Prussia over the two duchies.
In the Austro-Prussian War of 1866, Bismarck isolated Austria by assuring that Russia and France remained neutral. Upon Austrian defeat, Bismarck refused to create an enemy of Austria and demanded little reparations of Austria; this was politically done so so that Austria would not be revengeful and Prussia would not be looked upon as the “bad guy.” By defeating Austria, now Prussia had excluded Austria from a major role in German affairs and now dominated all of northern Germany.
Bismarck wanted to continue to unite all of Germany, including Bavaria. However, he was afraid that Catholic-tied Bavaria would side with France against Protestant North Germany, and thereby needed to go to war against France to utilize nationalism to bring together Germany. By tampering with France’s Ems Dispatch, this sparked Napoleon III to declare war, making France appear as the “bad guy.” Thus, Prussia was able to crush France, clearly identifying itself as a serious power, and thereby becomes united with Bavaria.
These political factors – the creation of friction between Austria and Prussia, the isolation of Austria, the minor reparations demanded of Austria, and drawing France into war – ultimately garnered German unification in 1871.