If you are an advertising or marketing student, an entrepreneur or a business professional – be prepared to learn about one of the most basic and functional tools for marketers still practiced heavily today – the SWOT Analysis. Like many topics in school that students seem to avoid (learning the quadratic formula in Calculus, reading a Brave New World for English lit or that extremely uncomfortable topic everyone in health class is embarrassed to learn about) – the detailed SWOT analysis is just something you are going to have to face learning and get used to writing regardless of how advanced our advertising methods get. The detailed SWOT analysis will be around forever and can really help you get a grasp of the environment your product or service is getting into and what you have to give to your potential customers that your competitors have forgotten. So here it is in plain English – the good, the bad and the ugly of the detailed SWOT Analysis.
As a professional marketer that has been working in this field, representing a multitude of companies throughout North America for over 15 years I continuously stand behind the benefits and effectiveness of developing and using a detailed SWOT analysis. Before I start any new project, whether for myself or for a customer, I have, and will continue to include the development of a SWOT analysis. My suggestion to you is that if you want your marketing initiatives to perform like a professionally developed plan then you need to think and act like a professional marketer. In this article I am going to share with you…
o What is Good about developing a proper SWOT Analysis “The Good”
o What is the downside of developing a proper SWOT Analysis “The Bad”
o What if the SWOT analysis doesn’t appear to provide value to my marketing plan? “The Ugly”
So why do seasoned advertising executives claim that a detailed SWOT Analysis of your product/service could open your eyes to an opportunity you had never imagined? Let’s put it this way – if you are the owner of a brand new company and you need to sell your business to your future employees who are ultimately responsible for reselling the idea of your business – it is probably best that you have a clear sense of what your enterprise is about. Your business’ vision, mission and core values are so important to determining whether or not customers see your product/service as a need. Is the product category you are in thriving, full of competition or are you yesterday’s trend? All these answers can be yours – by breaking down your company in a SWOT Analysis.
What’s so great about a SWOT? The easiest way to answer this question – is found in the acronym – plainly stated – a SWOT will tell you what the strengths, weaknesses, opportunities and threats are for your business. Strengths and weaknesses are attributes of your business that are identified internally -what’s going on within your own company’s environment? Some of the strengths you may have is that you were the first entrant into a category (i.e. Red Bull in the energy drink category), has your company won any awards, what makes you different from your competitors (do you have something they don’t that difficult to copy?) Weaknesses could be that you were not “one of the originals” and you are lumped in with all the other gazillion varieties of soap available today – you lack that “must-have” feature. Or maybe your product or service is a seasonal item – so your key selling peak only happens during a certain quarter of the year – in which case – how does the company survive for the other 3 quarters? Strengths and weaknesses are easy to identify if you really sit and think about what your company is, stands for and what it offers your customers. Opportunities and threats are identified externally – these are aspects that happen outside of your company that you are unable to control. Going back to the Red Bull example, the fact that the general public was finding themselves more frequently exhausted and looking for a “pick me up” – paved the way for Red Bull to really pack a punch with the public. And perhaps, the easiest example of a threat is something most companies seem to be facing today – the depressing state of the economy and the public cautious with their spending. These four aspects are quick and easy ways to access your company and with a little thought – you may open your company up to opportunities you have not have originally seen.
What’s so bad about a detailed SWOT Analysis – well for a first timer, be prepared this is only one of a gazillion SWOT Analyses you will do on a variety of companies and products. But don’t worry – practice makes perfect. Sometimes the first few SWOT’s can take a fair bit of time to nail down the formula, but soon it will become as simple as riding a bike.
The ugly of the detailed SWOT analysis is very rare but has seen the light of day. Perhaps the product category is so complex that a SWOT really doesn’t answer any immediate questions for your business. Or you’ve finally completed what you thought was an amazing analysis, only to realize that after investing a large amount of money in your “dream project” you’ve entered into an overly-saturated market and your product (with no great added value) will soon be lost in the masses – YIKES! Also, some companies mistake their internal strengths as external opportunities – in which your SWOT analysis becomes skewed and rendered non-helpful.
So even though as a first timer you become frustrated with what makes an attribute internal or external, the fact that sometimes you need to research your category to really get into some interesting opportunities once you become familiar with this process, there’s a good possibility you may begin to dream about SWOT analyses and begin applying them to your everyday life – one of the great things about a detailed SWOT analysis is that it’s a basic structure that really puts your business into perspective for yourself, your employees and most importantly what you have to offer your customers.