Once you’ve outlined your marketing objectives you’ll have to come up with marketing activities to achieve those objectives. But before you begin creating marketing strategies you’ll need to conduct a SWOT or situation analysis of your company. This will help you to not only gain a better understanding of your business, but also of your current and potential environment.
The purpose of a SWOT analysis is identification. A SWOT analysis will help you identify your internal (S)trengths and (W)eaknesses and your external (O)pportunities and (T)hreats.
A good strategy when conducting your internal analysis is to focus on your resources:
- Operational costs
- Marketing skills and resources
- Financial resources
- Your brand or company image
- Capabilities of your employees
- Current technologies
During your internal analysis, remember to review your business’s history, in particular your sales and profits. After you’ve identified your (S)trengths and (W)eaknesses, you’ll need to conduct the external analysis, or environmental analysis.
The external analysis, your (O)pportunities and (T)hreats, is defined by The American Marketing Association as, “The gathering and analyzing of data about a company’s or nation’s external environment to identify trends and their impact upon an organization or country. Included among the environmental forces considered are the political, cultural, social, demographic, economic, legal, international, and ecological factors.”
To simplify, a good tip to remember when conducting the external analysis is to remember the STEEPLED factors of your external environment:
The SWOT analysis can be a valuable method in evaluating the probability of achieving your objectives and is useful for identifying varying internal and external factors associated with your business. It is crucial to identify and scrutinize as much about your business as you possibly can. Remember, the purpose of the analysis is to help you in building a solid marketing strategy and establish a competitive advantage over firms in your industry.