Situation Analysis (SWOT) Lesson 5.4 – The Situation Analysis (SWOT)

S W O T The Situation (S.W.O.T.) Analysis Strengths Weaknesses LESSON 5.4 The Marketing Plan The Situation (S.W.O.T.) Analysis S Strengths Resources and capabilities that can be used as a basis for developing a competitive advantage W Weaknesses Qualities that give a business a competitive disadvantage O Opportunities Events that could facilitate company profit and growth T Threats Events that could have a negative impact on the company

Situational (S.W.O.T.) Analysis LESSON 5.4 The Marketing Plan Situational (S.W.O.T.) Analysis Strengths Weaknesses Opportunities Threats

Examples of strengths include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis S Strengths Resources and capabilities that can be used as a basis for developing a competitive advantage Examples of strengths include: Patents Strong brand names Positive reputation among customers

Examples of weaknesses could include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis W Weaknesses Qualities that give a business a competitive disadvantage Examples of weaknesses could include: Lack of patent protection Weak brand name Poor reputation among customers Lack of resources Inadequate distribution channels

Examples of opportunities could include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis O Opportunities Events that could facilitate company profit and growth Examples of opportunities could include: An unfulfilled customer need Arrival of new technologies A niche that has not yet been exploited Mergers Entry into new markets

Examples of threats could include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis T Threats Events that could have a negative impact on the company Examples of threats could include: Shifts in consumer tastes away from company products Emergence of new substitute products Government regulation

The Situational (S.W.O.T.) Analysis LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis As a hypothetical example, let’s say you were conducting a SWOT analysis for an apparel and footwear company competing with companies like Nike, Adidas and Under Armour for market share

Strengths might include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis S Strengths Resources and capabilities that can be used as a basis for developing a competitive advantage Strengths might include: Steady and consistent growth in profits Innovative new technology (lightweight, stretchable (fabric) that increases consumer performance Products tied to effective endorsement campaign (Serena Williams wears your new technology during games)

Weaknesses might include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis W Weaknesses Qualities that give a business a competitive disadvantage Weaknesses might include: 1. Too much reliance on sales of products online and not enough in retail environments (your products are not available at Dick’s or Foot Locker) 2. Low brand awareness (not enough consumers are familiar with your brand) 3. Dependency on sales of apparel products with a track record of limited growth in footwear (75% of total sales come from the apparel category)

Opportunities might include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis O Opportunities Events that could facilitate company profit and growth Opportunities might include: Well defined objectives with company-wide support (everyone in the company is behind the goal of increasing footwear sales in the next fiscal year) Positive industry outlook (forecasts call for substantial growth in the footwear and apparel markets for the next three to five years) Positive association with endorsers (Serena Williams’ popularity is extremely high and he uses your product and will be featured in an upcoming campaign promoting the brand)

Threats might include: LESSON 5.4 The Marketing Plan The Situational (S.W.O.T.) Analysis T Threats Events that could have a negative impact on the company Threats might include: Competitors launching new, similar product (Puma is launching a similar lightweight, stretchable fabric apparel line in the upcoming year) Rising raw material prices (the cost of producing products will rise) Poor economic conditions (consumers are spending less)

LESSON 5.4 REVIEW (ANSWERS) The Marketing Plan 1) Explain the purpose of a situation analysis The situation analysis provides information that is helpful in matching an organization's resources and capabilities to the competitive environment in which it operates by reviewing four key factors pertaining to the company’s current market situation (strengths, weaknesses, opportunities and threats).

1- Strengths 2- Weaknesses 3- Opportunities 4- Threats LESSON 5.4 REVIEW (ANSWERS) The Marketing Plan 2) Identify the four elements of a situation analysis 1- Strengths 2- Weaknesses 3- Opportunities 4- Threats