Get the habit of analysis - analysis will, in time, enable synthesis to become your habit of mind.
- Frank Lloyd Wright
A student wants to decide about enrolling in a course. They would look for the course's requirements and examine their capabilities, i.e., whether they could perform well in the course or not. Additionally, they would weigh the course's pros and cons. In other words, they would extensively analyze the course before deciding. In marketing, marketers also do multiple analyses in the planning phase. One of the critical analyses is the SWOT analysis of marketing. This explanation will cover the essential concepts of SWOT analysis marketing.
SWOT Analysis Marketing Definition
In business, managers conduct a SWOT analysis before starting out or entering a market. It gives them a comprehensive view of their capabilities and limitations. It also helps them identify the internal and external factors that could pose challenges in executing the strategies. Similarly, it holds the same importance in marketing. Marketers conduct the SWOT analysis to identify the potential issues beforehand and to plan for every foreseeable situation in the implementation stage. As a result, we define SWOT analysis in marketing as follows.
SWOT analysis marketing is a framework through which marketers identify the internal and external factors that could impact marketing goals and strategies. These factors are categorized as strength, weakness, opportunity, and threat.
There is too much riding on the marketing strategies of a business. With the marketing budget, other resources, product promotion, and marketing communications, a company can not afford to go wrong with its planning. Therefore, conducting a SWOT analysis before executing the strategies is essential. The business could save resources and optimize its marketing campaigns by doing so.
A business wants to launch a new product line in the market. In the planning stage, it must conduct a SWOT analysis. It can help in determining the strengths and weaknesses of the business. The management will know which strengths it can use in the product launch and the weaknesses it can improve. Additionally, it can help them avail themselves of the opportunities in the market and avoid potential threats. This analysis goes a long way in helping marketers to optimize their strategies.
Check out our explanations of Product and Product Line to learn about this concept in more detail.
Main Purpose of SWOT Analysis
Marketers conduct a SWOT analysis to ascertain the internal and external factors that could affect the implementation of marketing strategies. The internal factors are strengths and weaknesses, and the external factors are opportunities and threats. Marketers use this analysis to check the viability of a campaign.
Strengths (S) – The first internal factor is strength. It helps businesses identify the operations and processes that are working well. The company could use these strengths to build a competitive advantage in the market. Marketers could use these strengths in their marketing strategies and influence the choices of their target audience.
Weaknesses (W) – The second internal factor is weakness. Managers could identify the areas that are not working optimally and improve them. It helps a business strengthen its position in the market. Marketers can use this factor to enhance marketing campaigns and provide better solutions to their target audience.
Opportunities (O) – The first external factor is opportunity. This factor helps a business to identify market opportunities and seize them effectively. When a company can identify an opportunity before its competitors, it gives it a head-start in taking advantage of the situation. Marketers use these opportunities to improve marketing campaigns and plan better strategies.
Threats (T) – The second external factor is a threat. It helps a business identify the problems and challenges in the market. A business can prepare itself better for these challenges through SWOT analysis. Marketers also use this factor to develop solutions for existing problems and challenges.
Fig. 1 - SWOT analysis is an important part of a marketing plan
SWOT Analysis Marketing Plan
The SWOT analysis marketing plan provides detailed steps through which marketers can execute their strategies effectively. Once they have a plan, it leaves less room for errors and mismanagement. They could get key aspects spot on, such as setting objectives, budget allocation, etc. Let's go through each step of the SWOT analysis marketing plan.
- Set objectives – It is the first and crucial step in the SWOT analysis marketing plan. Marketers must set the goals for the program. For instance, you are raising the marketing budget or channeling the efforts towards a particular area. Along with the objectives, marketers set some marketing KPIs they would require to measure the strategy's performance.
- Play to your strengths – Identify the strengths and play to those strengths. This factor gives you an advantage over the competitors. For instance, a solid social media presence could strengthen a brand. Marketers should direct significant efforts towards the strengths to gain maximum advantage.
- Work on weaknesses – Identify your weaknesses and work on them. It would help in achieving optimum results from the marketing efforts. When marketers work on rectifying these weaknesses, it improves their marketing campaigns.
- Grab opportunities – The market provides new opportunities to brands. It is upon the decision-makers in the company to grab these opportunities. When a brand avails new opportunities, it can develop better products or services, gaining first mover advantage in some cases.
- Nullify threat – Identify the threat that could pose a challenge to the marketing plan. Once you have identified it, it is easier to plan actions against it. For instance, a threat could be changing government policy that limits certain marketing activities. Once you know it, you can plan how to modify your strategy.
- Develop the plan – The last step is to form the plan. You have identified all the critical aspects of the plan. The business must align the plan with the marketing objectives.
In the plan, it is essential to include how to execute and evaluate it. Adding this aspect will make it a comprehensive plan and help management to complete it without any problems.
Importance of SWOT Analysis in Marketing
The marketing department of a business has limited resources, and it needs to use those finite resources to achieve its marketing objectives. It is pivotal to the success of a brand to execute its marketing strategies effectively; SWOT analysis provides a basis for that. A brand could identify its strong and weak suits in the planning stage through a SWOT analysis. This way, it can help determine which areas of a marketing campaign are working fine and which issues need to be addressed. It helps avoid problems in the later stages; hence, the brand can avoid wasting resources.
Additionally, it helps determine the opportunities and threats in the external environment. The brand could use the opportunity to gain an advantage in the market. For instance, the brand could introduce a new product that fits the recent market trend. As for threats, early identification would help the brand develop solutions in the planning stage.
We can not ignore the importance of SWOT analysis in marketing. In a competitive marketplace, where brands face fierce rivalry, it helps them to optimize their marketing resources and gain a competitive advantage with targeted marketing campaigns.
SWOT Marketing Analysis Example
Here are a couple of examples of SWOT marketing analyses of famous brands. These examples show how these brands clearly identify the paths they want to take for marketing their products.
Coca Cola
Coca-Cola is one of the leading beverage brands in the world. It has a significant market share in the industry in many parts of the world. Its strengths are its strong brand identity, considerable market share, and product variety. However, its one significant weakness is its reputation as a non-healthy beverage. Some famous athletes have publicly gone against brands like Coca-Cola for producing non-healthy drinks.
Fig. 2 - Coca Cola has a strong brand identity
Zara
Zara is one of the biggest clothing brands in the world. Its effective distribution and manufacturing are its strengths. Zara has stores worldwide and sends its products to these stores thanks to its efficient logistics. The brand has global appeal and a client base almost in every part of the world. However, it spends nearly nothing on advertising, which is a weakness. Zara can enter new markets and achieve more through effective promotion.
Fig. 3 - ZARA has efficient logistics
Swot Analysis Marketing - Key takeaways
- SWOT analysis marketing gives the brand a comprehensive view of its capabilities and limitations.
- SWOT analysis helps brands identify the internal and external factors that could pose challenges in executing the strategies.
- Marketers conduct SWOT analysis marketing to identify the potential issues before introducing a strategy.
- SWOT analysis marketing helps a business save resources and optimize its marketing campaigns.
- The SWOT analysis marketing plan provides detailed steps through which marketers can execute the strategies effectively.
- Through SWOT analysis, a brand could identify its strong and weak suits in the planning stage through SWOT analysis.
- In SWOT Analysis marketing, the internal factors are strengths and weaknesses, and the external factors are opportunities and threats.
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