How to Conduct a Marketing SWOT Analysis
It’s easy to get lost in the weeds when you’re growing your business. However, it’s important to step back and take a long hard look at the big picture regularly to make sure you’re steering your company in the right direction.
Conducting a marketing SWOT analysis is one of the best ways to give you this bird’s eye view while generating practical insights so you can implement the right strategies to grow your business.
Here’s what you need to know about conducting a marketing SWOT analysis:
SWOT stands for strengths, weaknesses, opportunities, and threats.
It’s most commonly used by organizations to determine how closely their marketing efforts align with their growth trajectories and success benchmarks. It can also be used to track the performance of individual marketing campaigns.
Here’s what each of the four letters represents:
Strengths: what your organization does well, the unique selling points that make your company stand out, brand equality, internal resources (e.g., skilled employees,) and assets such as intellectual properties or propriety technologies.
Weaknesses: what your company lacks, things that your competitors are doing better, resource limitations, high churn rates, unclear market positioning.
Opportunities: underserved market segments that can benefit from your products, few competitors in a geographic region, a new product that meets emerging needs in the market, media coverage of your brand.
Threats: emerging competitors, changing regulations, negative press, changing market demands, unfavorable consumer attitudes toward your brand.
External vs. Internal Factors
While listing out the SWOT elements, you may notice that some of them are under your control while others aren’t so much. To focus your resources on things that you can proactively improve, subcategorize the elements into two groups: external factors and internal factors.
Most items listed under strengths and weaknesses are internal factors, which you have control over. For example, you can take steps to improve “high churn rates” and therefore, it’s an internal factor.
On the other hand, most opportunities and threats are external factors. For instance, “emerging competitors” is an external factor because you can't do much about it.
You can now create a 2x2 matrix to illustrate four types of strategies:
- Strength-opportunity strategies: leverage the company’s strengths to maximize opportunities.
- Weakness-opportunity strategies: minimize the company’s weaknesses using the opportunities available.
- Strength-threats strategies: using the company’s strengths to minimize the threats.
- Weakness-threats strategies: minimize the company’s weaknesses to avoid the threats.
How To Conduct a Marketing SWOT Analysis
Start your SWOT analysis by asking a series of questions regarding each of the components. Here are some examples:
Discover Your Strengths
Find out why customers choose your products and how you can stand out from your competition:
- What do your customers love about your brand and your products?
- Why are your products or services better than others in the market?
- What are your most important positive brand attributes?
- What are your unique selling points?
- What resources do you have available that your competitors don’t?
Consider Your Weaknesses
Discover what may cause customers to choose your competitors and what's keeping you from growing your market share:
- What do your customers dislike about your brand and your products?
- What are some common complaints or problems in negative customer reviews?
- Why do customers cancel your service or return your products?
- What are the biggest challenges you face in the current sales funnel?
- What resources do your competitors have that you don’t?
Uncover Opportunities And Understand Threats*
To understand these external factors, you may need to conduct in-depth competitive intelligence research to understand the market and competitors, as well as the bigger picture (e.g., business trends or economic climate.) Here are some questions to help you spot opportunities:
- What are the customer expectations in pre-sales support, customer onboarding, and post-sales customer care?
- What marketing message resonates with your target audience?
- What can you do to cultivate customer loyalty and advocacy so you can improve retention and referral?
- What marketing channels are performing exceptionally well, and why? What marketing activities aren’t yielding the predicted ROI?
- How can you allocate resources more effectively based on the answers to the above questions?
Here are some areas to consider when identifying threats:
- Emerging or established competitors that are posing the most threat to your brand.
- Changing regulatory environments that could impact how the business operates.
- Other political, economic, social, and technological (PEST) factors that could impact your business.
- Market volatility that could derail the current growth trajectory.
The Four Quadrants of a SWOT Analysis
SWOT analysis are often presented as a grid-like matrix with four distinct quadrants, each representing one of the elements.
The matrix makes it easy to see the various elements at a glance and how they may affect or inform each other.
Here’s an example:
Turn Your SWOT Analysis Into Action
Now that you have identified internal strengths and weaknesses, as well as external opportunities and threats, it’s time to turn the insights into actions. You should focus on applying your strengths to leverage the opportunities and converting current weaknesses into strengths.
1. Capitalize On Your Strengths
Doing more of what you’re good at and what’s working for your business is the key to increasing your marketing ROI. For example, can you leverage your company’s reputation to expand your market? Can you turn loyal customers into brand advocates?
2. Transform Your Weaknesses
By being honest about your weaknesses, you can prevent them from hindering the growth of your business. For example, how can you improve your product based on customer feedback? How can you improve your sales funnel to increase conversion rates?
3. Seize the Opportunities
Leverage your strengths to take advantage of the opportunities that are right in front of you. To turn the insights into action, you should define a roadmap with clear objectives, practical strategies, action items, and a definitive timeline. Devote sufficient time, energy, and resources to maintain your advantage and take appropriate actions so you don’t miss out on the opportunities.
4. Mitigate the Threats
While threats are often external factors you don’t have much control over, you can mitigate them by closely monitoring the market conditions or design response plans so you won’t be caught off guard if the risks materialize.
5. Create an Action Plan
There are many moving parts when it comes to turning insights from a SWOT analysis into action. While it's important to manage the day-to-day activities, you also need to make sure that they’re aligned with your mid-term and long-term goals.
To make sure nothing falls through the crack, set up a system to track all the activities — for example, by using this bullet journal format, which allows you to see everything all in one place so you’ll know exactly what to do on a daily, weekly, and monthly basis.
In today’s competitive business environment, you can’t afford to throw spaghetti on the wall and hope that something will stick.
A SWOT analysis gives you a thorough and accurate understanding of your business and the market condition so you can design and implement an effective marketing plan.
With insights gained from your SWOT analysis, you can devise a strategy that fully leverages your strengths and take advantage of available opportunities while minimizing the impact of your weaknesses and mitigate risks.
About the Author
Matt Shealy is the President of ChamberofCommerce.com. Chamber specializes in helping small businesses grow their business on the web while facilitating the connectivity between businesses and more than 7,000 local Chambers of Commerce worldwide.