SITUATION ANALYSIS Business Mission Statement Objectives Situation or S.W.O.T. Analysis

Companies do and just to name a few… Who conducts a S.W.O.T. Analysis?

What is a Situation Analysis?  A situation analysis is referred to as a S.W.O.T. Analysis  Definition:  The firm should identify its internal strengths (S) and weaknesses (W) and also examine external opportunities (O) and threats (T).

When are S.W.O.T. Analysis Conducted?  Before marketing activities can be defined, marketers must understand the current and potential environment that the product or service will be marketed in

How To Conduct a S.W.O.T. Analysis?  Research your company and your competitors  Databases  Companies can also hire someone to conduct a SWOT analysis for them

Focus on organizational resources such as: Production costs Marketing skills Financial resources Company image Brand image Employee capabilities Available technology Strengths and Weaknesses (Internal)

Marketing managers must analyze aspects of the marketing environment Environmental scanning-the collection and interpretation of information about forces, events, and relationships in the external environment that may affect the future of the organization or the implementation of the marketing plan. Opportunities and Threats (External)

Environmental scanning helps identify market opportunities and threats and provides guidelines for the design of marketing strategy Opportunities and Threats Cont.

Why Do Firms Conduct S.W.O.T. Analysis?  Marketers must understand the current and potential environment that the product or service will be marketed in  The most often studied macroenvironmental forces are:  Social  Demographic  Economic  Technological  Political  Legal  Competitive

Example of a S.W.O.T. Analysis  Nike Inc. SWOT Analysis:  Strengths Global Brand with Strong Brand Equity Nike is a globally recognized brand with 38 years of established equity The swoosh symbol is one of the top ten most recognized brand symbols in the world Skimming Price Strategy Pricing products slightly higher than competitors Advertising/Endorsement Growth Capitalization of Its Products Releases new product lines with the seasons of various sports

Example of a S.W.O.T. Analysis Cont.  Weaknesses Over commercialization A huge brand in a market looking for something new Easy tone shoes Pricing as a Competitive Disadvantage Because prices are slightly higher this can put Nike at a disadvantage Varied Reputation Lost some brand equity through the public release of information about the company operating sweatshops in third world countries

Example of a S.W.O.T. Analysis Cont.  Opportunities Consumer Lifestyle Improvements The brand attempts to enhance the quality of life for consumers by creating better quality products than the competition Nike Pro Combat Line Emerging Markets China, Russia, and India are huge markets that are now pursing consumers and consumer shopping goods Acquiring Smaller Competitors Sports apparel market is saturated with smaller competitors Nike can merge with companies like Russel Athletics, Champion, and Starter for an example

Example of a S.W.O.T. Analysis Cont.  Threats Intense Competition Reebok, Adidas, and Under Armor Economy Global recession Retail Spending Decline Negative growth in shopping both online and in stores