The SWOT analysis is a cornerstone of marketing strategy. And its beauty lies in its simplicity.
It can be applied to the global marketing strategy of a multinational corporation. It can be applied to the regional marketing strategy of an SME. And it can be applied to an individual marketing campaign from a startup.
When conducted effectively, the SWOT is equally insightful in all of these use cases. But there are a few golden rules to follow to ensure that its value is maximised. This will help to ensure your marketing strategy is informed in the best possible way.
What does SWOT stand for?
SWOT stands for Strengths, Weaknesses, Opportunities, Threats.
- Strengths are: things that set your business apart
- Weaknesses are: things that your business could improve
- Opportunities are: weaknesses you could turn to your advantage or market developments that could favour your business
- Threats are: market developments that could negatively impact your business
What is a SWOT analysis?
A SWOT analysis provides a complete overview of the internal strengths and weaknesses of an organisation. It also outlines the external opportunities and threats facing it. It’s a simple yet effective methodology that should be used when markets evolve and business priorities change.
Why is conducting a SWOT analysis necessary?
A SWOT analysis gives you the information you need to ensure your marketing strategy plays to your strengths and authentic values. It also helps to contextualise your business in the wider market and identify strategic opportunities. This can help to position your company uniquely and capitalise on your niche.
What are the pros and cons of a SWOT analysis?
3 SWOT analysis pros:
- Versatile. A SWOT analysis can be helpful to determine the value of any task; big or small.
- Simple to conduct. The SWOT matrix is an easy, repeatable framework. And that framework provides a wealth of information you can leverage to your company’s advantage.
- Forms the backbone of more granular research. By providing clarity on the ‘bigger picture’ for your business, particular threads and themes can be prioritised and investigated further.
3 SWOT analysis cons:
- Subjective rather than quantitative. SWOT analyses are difficult to scrutinise because they’re based on opinion. As a result, it can be challenging to order which opinions matter most.
- Can lead to oversimplification of structural issues. Some business problems require multifaceted strategies to overcome. Listing them alongside easily solved issues can trivialise them.
- Requires further research to be fully effective. A SWOT can’t be effective unless it’s translated into practical action points.
How can a SWOT analysis be performed?
A failsafe five-step method for conducting a successful SWOT analysis is as follows:
SWOT ANALYSIS STEP 1: Agree SWOT’s purpose and desired outcomes
Defining the purpose of the SWOT analysis and communicating it to all stakeholders is crucial. That’s because people are likely to be more engaged with projects they see the value in.
SWOT key aim: To gain internal and external perspectives on your company’s strengths, weaknesses, opportunities and threats.
SWOT desired outcome: To action these insights in the new marketing strategy, capitalising on company differentiators and market opportunities.
SWOT ANALYSIS STEP 2: Identify internal and external stakeholders to interview
When arranging internal stakeholder interviews, make sure you canvas a wide range of opinions. This means speaking with a representative from marketing, sales, accounting, the executive team and more. The narrower your scope, the less authentic your SWOT will be.
When arranging external stakeholder interviews, make sure you select individuals who haven’t previously worked for the business. It’s important to gain an objective opinion on how your business is regarded by industry peers.
SWOT ANALYSIS STEP 3: Create a list of questions to ask all stakeholders
All interview questions should be open. That’s because they don’t predetermine the interviewee’s responses or colour them with other perspectives or opinions. Ask questions like:
- What are your strengths as a business? (e.g. unique business culture, commitment to customer service, what your product/service offers that competitor products don’t)
- What are your weaknesses as a business? (e.g. lack of visibility, unrepresentative brand, undefined roles and responsibilities)
- What are your core business opportunities? (e.g. upcoming legislation, government changes, market growth)
- What are the main threats to your business? (e.g. upcoming legislation, government changes, disruptive competitors)
TOP TIP: Doing market research before your stakeholder interviews helps put the opportunities and threats facing your business in context.
SWOT ANALYSIS STEP 4: Interview stakeholders
Conducting separate interviews is the only appropriate avenue for external stakeholders. However, this process can be needlessly time consuming for internal stakeholders. After all, these people know each other. In this case, workshops can be more efficient.
Workshops also create a collaborative dynamic. This will help you to prioritise strengths, weaknesses, opportunities and threats by department and throughout the business as a whole. But whichever path you go down, take extensive notes and ask permission to record the conversation. This ensures that no insight is missed.
SWOT ANALYSIS STEP 5: Compile your findings
Now, cross-reference the findings from your stakeholder interviews with your market research. This will help you prioritise the best opportunities and most pressing concerns your new marketing strategy needs to address.
For example, Frog Capital positioned themselves as scale-up experts, leveraging their unique experience to help more CEOs scale their businesses. Meanwhile, Oxbotica chose “universal autonomy” as its value proposition to differentiate its autonomous vehicle software against the competition.
DOWNLOAD OUR FREE SWOT ANALYSIS TEMPLATE HERE
Actioning the SWOT analysis
To effectively action the SWOT analysis, businesses of all sizes often bring in a third-party marketing partner. This is because these partners are objective, allowing them to shine a different light on company values and brand identity.
Third parties are also removed from the internal politics of your organisation meaning that they can be totally frank. This means they can put checks and balances in place to ensure your SWOT analysis is both realistic and actionable.
Quick-fire SWOT analysis FAQs
What is the difference between a PEST analysis and a SWOT analysis?
PEST (or PESTLE) is a traditional market research tool. By comparison to SWOT, it’s solely concerned with the external threats and opportunities your organisation should consider. Typically, PEST focuses on specific factors and market drivers, such as changes in government, new legislation and changing policy.
Is SWOT analysis still effective?
The SWOT is a classic marketing tool, invented by Albert Humphrey in the 1960s. But that doesn’t mean it’s not relevant in the digital marketing age. That’s because it’s capable of gaining authentic insights into your business – a quality which can’t be underestimated.
What is the conclusion of a SWOT analysis?
The SWOT analysis is designed to gather high-level insights. And as it’s not underpinned by quantitative data, it shouldn’t have a single defining message. However, there should be dominant themes which can be interrogated further to inform your marketing strategy.
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