A key component to marketing and strategic planning is conducting a SWOT analysis. SWOT is the acronym for analyzing Strengths, Weaknesses, Opportunities, and Threats, and is an effective tool for developing an overall marketing strategy, or for planning individual campaigns.
The SWOT Analysis
The SWOT analysis looks both inward (strengths and weaknesses) and outward (opportunities and threats) to develop strategy and make the best use of resources. Strengths and weaknesses are elements the organization has control over, while opportunities and threats are elements the organization does not have control over, but would be wise to anticipate.
• Strengths: What is going or went well? What gives us an advantage in the marketplace or over our competitors? What do our current resources excel at? Was the return on investment a gain?
• Weaknesses: What did not go well? What gives us a disadvantage in the marketplace or among our competitors? What are weaknesses among our current resources? Was the return on investment a loss?
• Opportunities: What is going on outside of the organization that we can capitalize on?
• Threats: What are things going on outside of the organization that can negatively impact our business?
Imagine you are building a marketing campaign for a local, independent bakery/coffee shop, with the goal of increasing breakfast traffic, and competing against nearby national chain restaurants.
The SWOT analysis may look something like this:
• Strengths: Talented bakers with innovative creations using local ingredients; location within walking distance of several large office buildings; long history in community.
• Weaknesses: Small advertising budget; limited resources.
• Opportunities: Fall and holidays coming soon; popularity of locally-sourced and sustainable ingredients.
• Threats: Within walking distance of two or more national chains; increasing prices of ingredients.
Developing Strategies from the SWOT Analysis
Combine the results of the SWOT analysis to create strategies for your campaigns.
• Opportunities/Strengths: Strategies that use strengths to take advantage of the identified opportunities. Example: Increase advertising of catering services to local businesses for upcoming holidays. Combines location (strength) with opportunity (upcoming holidays).
• Opportunities/Weaknesses: Utilize external opportunities to overcome real or perceived weaknesses.Example: Seek low- or no-cost advertising opportunities (social media, free samples at nearby office buildings) to promote breakfast options and catering services. Combines opportunities (holidays, ingredients) and weaknesses (small advertising budget).
• Threats/Strengths: Use strengths to prevent damage from threats.Example: Utilize social media outlets to emphasize ingredients and that the business is a tradition in the community. Location and using local resources are strengths, creating a comparison to the nearby national chains (threats).
• Threats/Weaknesses: Identify measures to improve weaknesses and thereby avoid threats.Example: Participate in and maintain visibility within the community via local fairs and festivals, farmers’ markets, and volunteer opportunities. These opportunities can be low-cost yet create a strong local following, thereby averting the threat created by national chains. Combines weaknesses (small advertising budget) and threats (loosing market share to local chains).
Sometimes developing a marketing campaign can feel like a shot in the dark. Or we develop campaigns based upon what is popular or the new buzzword. Using a SWOT analysis to develop marketing strategy assists in making educated decisions and developing more targeted campaigns.
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