TL;DR: Marketing moves fast; you have to move faster. A SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) can help. In this guide, we explain how to do a great SWOT analysis, with real-life examples and best practices (and our AI-powered SWOT Assistant to draft one for you.
So What? A SWOT analysis is a deceptively simple approach that helps you quickly analyze where your business stands in the market, especially in regards to competitors.
What Is a SWOT Analysis?
The acronym SWOT stands for Strengths, Weaknesses, Opportunities, and Threats. A critical marketing tool – especially if you’re new to a company – a SWOT analysis examines these four elements to guide decision-making about your brand or business. It contains:
- Strengths: Your brand’s strengths are the positive attributes that give it a competitive edge. Benchmarking – comparing your organization’s performance metrics with industry standards or competitors – can help you pinpoint strengths by providing a basis for improvement.
– Subject matter experts can give valuable insights into your business’s strengths with their expertise.
– A companion VRIO analysis (Value, Rarity, Imitability, and Organization) will help you gauge the sustainability and value of the strengths in the SWOT analysis.
- Weaknesses: These internal hurdles put your organization at a disadvantage vis-a-vis the competition. Maybe you have insufficient in-house expertise or a lack of resources–a SWOT analysis could help you uncover these issues. (VRIO is another good approach to understanding your organization’s weaknesses.)
- Opportunities: Your brand’s opportunities are outside factors you can use to your advantage. A competitor analysis looks into the strengths and strategies of your rivals, helping you spot changes to differentiate yourself from them and gain a competitive edge.
– Staying on top of market trends will help you align your brand and campaign(s) with emerging market gaps–and adapt your offerings if needed to stay relevant.
– A PESTEL analysis examines the political, economic, social, technological, environmental, and legal factors, helping you find opportunities to use to your advantage in a SWOT analysis.
- Threats are outside elements that pose potential risks to your company’s success. These might include an economic downturn, new legislation affecting your industry, or changes in customer tastes.
Marketer’s Takeaway: SWOT analysis can guide your decision-making before or even during a marketing campaign. First, identify your strengths via benchmarking, subject matter expert insights, and VRIO analysis. Then find your opportunities through competitor analysis, market trend monitoring, and PESTEL analysis. Finally, address your company weaknesses, and identify and anticipate threats.
Why Do You Need a SWOT Analysis?
In marketing, a SWOT analysis is an excellent means of:
- Strategic Planning: A SWOT analysis helps with assessing a company’s strategy and direction. If you’re new to a company or to a role, it’s a quick way to get the lay of the land.
- Identifying Opportunities: SWOT helps identify new market trends and opportunities for expansion or diversification. It allows you to leverage internal strengths to take advantage of opportunities before your competitors.
- Change Management: It also helps you adapt by preparing the company for potential external threats and opportunities. Recognizing internal strengths and weaknesses can foster innovation to stay competitive.
- Reviewing Market Positioning: An analysis will help you see exactly where your brand stands with consumers and competitors in your vertical.
- Optimizing Resources: You can more accurately apportion the money you’ve set aside for a particular campaign when you understand where your brand shines and where it still needs improvement.
Marketer’s Takeaway: Some analysts organize SWOT analyses into tables representing “Internal” and “External” factors. This creates an idea of how each part of the analysis fits inside or outside the control of the organization and their marketing efforts:
SWOT Analysis Best Practices
In marketing, customer tastes and behaviors can change quickly. SWOT analysis can help you better manage your brand amid the movement. Best practices include:
- Use and Cite Data: Ground the analysis in data from trustworthy, reputable sources to enhance your credibility – and be sure to cite your sources.
- Engage Stakeholders: Include multiple perspectives and interviews in your SWOT analysis. You’ll not only get a better picture, but you’ll involve different team members, which means they’re more likely to be interested in your findings.
- Be Honest: Emphasize clear communication in your analysis so you get a realistic assessment of the factors affecting your organization. While you may need to be politically sensitive, try to be honest, especially about weaknesses and threats.
- Keep Your Analysis Up to Date: It can be useful to revisit your SWOT analysis – say, once a year – to account for market and industry shifts, and to see how the company has progressed.
- Highlight takeaways: Extracting actionable insights from your SWOT analysis will help you create practical strategies from your findings.
Marketer’s Takeaway: Most SWOT analyses get read once and never seen again. By using quality data, bringing in diverse stakeholder viewpoints, and regularly revisiting, you can make your SWOT analysis a driver of ongoing change.
SWOT Analysis Examples
The following SWOT analysis examples show how two fictional companies would use our best practices.
Example: Tech Startup: “NexaTech Innovations”
- Strengths: NexaTech has an innovative product and a young, savvy marketing team. Critical metrics in this section will quantify high customer satisfaction, unique product features, and many instances of employee innovation.
- Weaknesses: The startup needs a bigger budget and public awareness. The analysis prioritizes ready acknowledgment of these facts and outlines plans for creative, cost-effective marketing strategies.
- Opportunities: NexaTech will capitalize on its market’s current and expected expansion by specifying growth rates, potential customer segments, and likely upcoming trends. The analysis will also delve into potential partnerships for the company.
- Threats: The analysis recognizes multiple better-established, household-name competitors and a quickly changing market.
Example: Local Bookstore: “Lumina Pages”
- Strengths: Lumina Pages has a loyal clientele because of their unique in-store experience and personalized customer attention. Metrics here will focus on customer retention, satisfaction, and in-store engagement.
- Weaknesses: As a small brick-and-mortar, Lumina Pages has a limited online presence, and its prices are often higher than those of online competitors. The analysis acknowledges these hurdles and looks into strategic plans for online expansion that will maintain the unique in-store experience for customers.
- Opportunities: By identifying opportunities such as local author collaborations, book signings, and readings, Lumina Pages can measure metrics related to event attendance, author partnerships, and community engagement.
- Threats: Ebooks and big online book retailers are Lumina Pages’ biggest threats. The SWOT analysis’s involvement of different stakeholders will help the company understand changing customer tastes to offer an improved browsing and shopping experience. It will also seek to leverage community relationships to help it compete with the large online shops.
How to Use Our SWOT Analysis Assistant
Just answer a few questions about your business or product, and our AI-powered assistant will draft a SWOT analysis for you.
Remember: the more information you give it, the better your SWOT will get. You can keep refining the SWOT until you’re happy with the results — then have it emailed to you, instantly and free.
SWOT analysis is an essential tool for marketers, offering a full view of a brand’s market position. It’s a great tool to get a quick overview of a company, or to share a “state of the union” with your team or boss.
To maximize SWOT analysis benefits, marketers should establish a sustainable workflow they can use repeatedly, prioritize clarity, and regularly update the analysis. Our AI-powered SWOT Analysis can help..
Could your brand use more hands-on guidance? Let us help you. Take Media Shower for a test drive today.