If you’ve ever worked in marketing or digital marketing, you may have come across the term “SWOT analysis”. Do you have a new business idea, but you are not sure whether it’s worth investing in? Or you might be willing to take a new step within your current business, but you want to predict the risks. At times like these, SWOT analysis can be the most valid method for you to jump from abstract plans to concrete results.
In fact, a SWOT analysis which is considered beneficial all over the world, is simply a risk analysis. SWOT analysis is a technique used to determine and define your Strengths, Weaknesses, Opportunities, and Threats, as well as a tool that gives you insights about the current state of your business in the context of market and consumer conditions.
Also, SWOT analysis is a powerful and effective evaluation method that you can apply on a wide range, from your personality traits to the project you want to implement, from human resources processes to team building. In this article, you will learn what is this method is all about, go through some SWOT Analysis examples, and learn some tricks for self-analysis.
The first step of the SWOT analysis is to identify strengths. Essentially, this part is aimed at noticing and cherishing the things you have been doing well in your business or project.
Also, the presence of teams that carry out the operational processes in your company very efficiently as well as the technologies you use in the product development process can be listed among your strengths.
For instance, any product in your company can consistently achieve unique sales and demand rates compared to competitors in the market.
Some examples of strengths
- Having a large and talented staff.
- Strategic and long-term goals are determined.
- Foresight and utilize the opportunities.
Your weaknesses are the traits that are holding your business or project back and should be taken into account. In fact, this step of your SWOT analysis will help you to define your weaknesses by listing the most common problems you are experiencing, breaking them down, and trying to understand the root cause of these issues.
Certainly, your weaknesses can include organizational challenges like a shortage of skilled people and financial limitations.
Some examples of weaknesses
- Having financial problems.
- The budgets are not large enough compared to the companies it competes with.
- No investment in R&D.
The next step is Opportunities. Can’t keep up with the volume of leads being generated by your marketing team? That’s an opportunity. Is your company developing an innovative new idea that will open up new markets or demographics?
Above all when you take advantage of this whole stage, there may be new stuff that you may never have paid attention to before, such as new demographic information, behavioral patterns…
In short, this element of the SWOT analysis covers everything you could do to improve sales, grow as a company, or advance your organization’s mission.
Some examples of opportunities
- New areas, products, and specialties that can be a trend.
- Even the technologies you use in product development and research processes may create new opportunities.
- The experience of your team consisting of expert staff in any of your units.
- Innovative original ideas.
- Unexplored niche channels in your market.
The final element of a SWOT analysis is Threats. As a matter of fact, this factor could include things like emerging competitors, changes in regulatory law, financial risks, or virtually everything else that could potentially jeopardize the future of your company or project.
Examples of threats
- New competitors rising in the market.
- Financial crises and the financial condition of the company.
- New legal regulations.
- Third parties may spread false information about your company.
Meanwhile, it is important to note that this article covers only general examples. Therefore, you should definitely develop a model specific to your situation.
Also, if you want to have an in depth understanding of extensive analysis and digital solutions in the field of digital marketing, you can use Google Analytics, an analysis tool designed by Google to get information about users visiting your website.
For more information, visit the following article: What is Google Analytics? Complete Guide for Beginners
Internal and External Factors
When doing SWOT Analysis, the four factors above are common to all. Therefore, companies classify this four-step process as internal and external factors in a word. On the other hand, strengths and weaknesses constitute internal factors, opportunities and threats constitute external factors.
SWOT Analysis Samples
As an example, let’s take a look at the SWOT analysis of e-commerce as a concept that almost everyone is familiar with.
- No boundaries (Any person around the globe can be a potential customer)
- Time savings
- No time limitation (E-commerce is accessible at any time)
- Product/price comparison can be made
- Affordable cost
- Direct communication with the customer (For example, social media, online ads)
- Enhanced customer interaction (For example, quick feedback, and comments)
- Flexible target market segmentation (In other words, the target market can be changed at any time)
- Simple and easy information exchange
- A decrease in transaction costs
- Easy product management
- Fast buying procedure
- No need to establish a physical company
- Low operating costs
- Security (So, your e-commerce website must have up to date security measures)
- Fake websites
- Fewer discounts and bargains
- Delivery time can be unexpectedly extended
- Lack of information about the quality and physical condition of the product
- Limited products
- Increased shipping cost
- Limited access (Inability to be active where internet is not available in short)
- Changing trends (E-commerce services will attract more attention when the client’s impression of online shopping is positive)
- Developing technology (Security measures updated with the developing technologies will enable users to turn to online shopping more easily in short)
- Global expansion
- High availability (7 days 24 hours)
- Wide range of business (That is to say, has a broad business scope and vision)
- Competitors (So, the world of e-commerce is growing day by day)
- Environmental, legal, and regulatory changes
- Innovation (Customers are constantly looking for innovation in products in a word)
- Privacy concerns
- People prefer to shop physically as there is no direct interaction like bargaining in the online world
- Fraud (So, it is difficult for those who fell victims to it to regain trust in e-commerce)
In this article, we explained how you can determine your company’s strengths, weaknesses opportunities, and threats through SWOT analysis. In summary, SWOT Analysis is a useful technique used for defining the current situation of your business during the planning process. Above all, a comprehensive SWOT analysis can be the milestone of sound strategic planning. Additionally, you should use a SWOT analysis with other strategy tools. So you can get a comprehensive picture of the situation.
For more information about how to do a SWOT Analysis, reach out to our Earnado team.