InFo

SWOT Analysis

Before specific marketing activities can be defined, marketers must

understand the current and potential environment in which the

product or service will be marketed. A situation analysis is

sometimes referred to as SWOT analysis. This analysis is an audit

that determines the firm’s internal strengths (S), weaknesses (W)

and examining external opportunities (O) and threats (T).

1. Strengths (S)

 

What is the organisation or business good at? What are its key

advantages over the competition in terms of its products and

services as well as its facilities, customer service and expertise of

employees? These are an operation’s unique ability to gain a

competitive edge over competitors. These should be difficult to

duplicate attributes.

The strengths of the firm should be viewed from the perspective of

the customer or potential customer. Examples of strengths that will

be of concern to the customer include:

Environmental Scan

Internal Analysis External Analysis

Strengths Weaknesses Opportunities Threats

SWOT Matrix

• Company reputation

•

Location, accessibility

•

Standard of service

•

Quality of the company’s products

•

Patents

•

Strong brand names

•

Friendly and well-presented team members

2. Weaknesses (W)

What is the organisation not good at? Where does the business fall

down in terms of the ways it does things? Are the products and

services good enough? Are the buildings, the facilities or the

attractions of poor quality? Is the staff not very good at handling

customers? These are serious flaws that require immediate

corrective action, especially when they prevent an operation from

pursuing an opportunity or avoiding a threat.

Weaknesses, as viewed by the customer, usually occur in the same

aspects of the organisation as those identified above as examples of

strengths.

3. Opportunities (O)

What is happening outside the organisation that offers

opportunities? Has the mass transit transport (MRT) track (e.g.

where the hotel is located) been in operation? Has the country’s

government been spending more money on promoting the area?

These questions were raised with the view to determining the

market’s size and growth trends within the market. For example, the

total market size in number of room available, number of rooms

sold, and room sales in dollar value for the last year. In addition, an

assessment of the economic outlook should be included.

Opportunities are those presented to the organisation. If acted

upon quickly, they are likely to provide further opportunities to

increase sales and improve the image of the organisation.

Marketing and promotional strategies should take advantage of

opportunities as they arise.

4. Threats (T)

 

What is happening outside the organisation that could threaten it?

Are there more competitors? Are there problems with the area?

Perhaps a nearby area has received investment, which might mean

that the local area is now less attractive for the business. For e.g. in

assessing competition, the first thing to do is to identify direct and

indirect competitors.

Threats to an organisation can arise in many shapes and forms and

are often unable to be pre-determined. However, if acted upon

early, threats may be easily overcome or even turned into

opportunities. Examples of threats may include such things as:

•

New competition in the market place

•

A change in management or ownership

•

A change in or closure of neighbouring organisation• A changing economic or industrial climate