Completing a SWOT analysis helps you identify ways to minimize the effect of weaknesses in your business while maximizing your strengths.
Ideally, you will match your strengths against market opportunities that result from your competitors’ weaknesses or voids.
This is an activity that should be done regularly.
You can develop a basic SWOT analysis in a brainstorming session with members of your organisation, or by yourself if you are a one-person enterprise.
To begin a basic SWOT analysis create a four-cell grid or four lists, one for each SWOT component:
Then, begin filling in the lists.
Strengths – Think about what your organisation does well. What makes you stand out from your competitors? What advantages do you have over other businesses?
Weaknesses – List the areas that are a struggle. What do your customers complain about? What are the unmet needs of your sales force?
Opportunities – Try to uncover areas where your strengths are not being fully utilized. Are there emerging trends that fit with your organisation’s strengths? Is there a product/service area that you could do well in but are not yet competing?
Threats. Look both inside and outside of your organisation for things that could damage your business. Internally, do you have financial, development, or other problems? Externally, are your competitors becoming stronger, are there emerging trends that amplify one of your weaknesses, or do you see other threats to your organisation’s success?
A more in-depth SWOT analysis can help you better understand your organisation’s competitive situation. One way to improve upon the basic SWOT is to include more detailed competitor information in the analysis.
You can also take a closer look at the business environment. Often, opportunities arise as a result of a changing business environment. Some examples are:
A new trend develops for which demand outstrips the supply of quality options.
A customer segment is becoming more predominant, but their specific needs are not being fully met by your competitors.
A customer, competitor, or supplier goes out of business or merges with another organisation. Opportunities may arise to gain the defunct business.
You can also enhance a SWOT analysis through surveys. You can learn more about your own as well as competitor sites and businesses. Areas you can research include
1) customer awareness, interest, trial, and usage levels;
2) brand, site, and/or organisation image;
3) importance of different site or product attributes to your customers; and 4) product and/or site performance.
Whether using a basic or more advanced approach to SWOT analysis, you are sure to come away with newfound insights. Use these to increase your organisation’s effectiveness and as input into your business or marketing plan.