What is a SWOT (Strength, Weaknesses, Opportunities, Threats)?
If you’re at all interested in marketing, you’ll want to know what a SWOT marketing analysis is. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats, and it’s something business owners should take a look at every now and then to evaluate the status of their company, the market, and the competition. The first two components of SWOT, Strengths and Weaknesses, are internal. What is your company good at? What are some things that could use improvement? These will help you evaluate your company’s status. The last two components, Opportunities and Threats, are external. What is the market like? Who is your competition? These will help you evaluate your surroundings and plan a strategy.
Keep reading for more details on each component so you, or your marketing agency, can perform a SWOT analysis of your business.
What are your strengths? Why do people choose you when they could choose someone else? Perhaps you have been in business for many years. It might also be that you have the largest selection of a certain category of products or you offer the lowest prices in town. You might have very high brand awareness or maybe you’re known for your quality. Maybe they can’t choose someone else because you’re the only one that can provide your service or product. Company strengths are things that make you stand out. Once you know what they are, you will be able to expand on them and maximize your potential.
This can be the toughest part of your SWOT analysis. To do it well, you’re going to need to take an honest look at your business. No matter how strong you might be, everybody has weaknesses, and if you want to improve, you have to be aware what those weaknesses are. It might be that you have a small inventory or a hard-to-find location. Your prices might be on the high side. Perhaps you’re not as well known as other businesses. Maybe your advertising budget isn’t as big as the competition’s. Don’t be afraid to take a close look and be critical. You might not be able to erase all of your weaknesses, but if you’re not honest about them, they will get in the way of further growth. That brings us to another SWOT component.
The market is full of opportunities.Companies that see those opportunities and jump on them can reap huge rewards, but you have to have an open mind to see what the market is offering you. Take a look. Where are the chances for growth in your market? Maybe there is unmet demand for a certain kind of product or service. It’s possible you’ve exhausted opportunities in your city, but there’s space for another location somewhere else. Could you be utilizing social media better to increase brand awareness and product sales? The opportunities are out there, you just have to find them.
You’ll also want to keep an eye out for possible threats. These are things you might not be able to control, but can still negatively affect your business. Oftentimes, this will come from new or existing competition. Maybe another burger joint opens up across the street, or maybe the one from the next block over puts up a billboard on the freeway. You can’t stop them, but you can make sure it doesn’t hurt you too much. Improvements in technology can also be threats. If you’re not aware and willing to adapt, you can become obsolete. I’m not sure Hollywood and Blockbuster video knew what hit them when Redbox launched. Now online services like Netflix and Hulu offer the convenience of movies without even leaving your home. There will always be a better mousetrap, and if you can’t sell it, you can at least prepare yourself for when someone else does. Possible threats also include new taxes or regulations, which can raise prices, or force you to change the way you do business. Being aware of your surroundings and incoming threats is a must if your company is going to survive.
Hopefully, you have a better understanding of a SWOT analysis and why it’s important. You can do your SWOT analysis yourself or, even better, you can have a third party assist you. A third party can be more objective, and may be able to make better sense of the facts and data. Highstreet Advertising has years of experience doing SWOT analyses. They’ve helped many businesses like yours, and know how to turn those findings into a winning marketing strategy that will get you the most bang for your buck. Sign up for your free consultation and get started on your SWOT analysis today.