Download Lessons from Chapter 5

Lessons from Chapter 5
SWOT analysis:

is considered to be one of the most useful tools in analyzing marketing data and
information.

links a company's ongoing situation analysis to the development of the marketing plan.

structures the information from the situation analysis into four categories: strengths,
weaknesses, opportunities, and threats.

uses the structured information to uncover competitive advantages and guide the
selection of the strategic focus for the firm's marketing strategy.
To make SWOT analysis as productive as possible, the marketing manager should:

stay focused by using a series of SWOT analyses, each focusing on a specific
product/market combination.

search extensively for competitors, whether they are present competitors or ones in the
future.

collaborate with other functional areas by sharing information and perspectives.

examine issues from the customers' perspective by asking such questions as "What do
customers (and noncustomers) believe about us as a company?” and “Which of our
weaknesses translate into a decreased ability to serve customers (and a decreased ability
to convert noncustomers)?” This includes examining the issues from the perspective of
the firm's internal customers, its employees.

look for causes, not characteristics by considering the firm's resources that are the true
causes for the firm's strengths, weaknesses, opportunities, and threats.

separate internal issues from external issues using this key test to differentiate: "Would
this issue exist if the firm did not exist?" If the answer is yes, the issue should be
classified as external.
Strengths and weaknesses:

exist because of resources possessed (or not possessed) by the firm, or they exist due to
the nature of key relationships between the firm and its customers, its employees, or
outside organizations.

must be leveraged into capabilities (in the case of strengths) or overcome (in the case of
weaknesses).

are meaningful only when they assist or hinder the firm in satisfying customer needs.
Opportunities and threats:

are not potential marketing actions. Rather, they involve issues or situations that occur in
the firm's external environments.

should not be ignored as the firm gets caught up in developing strengths and capabilities
for fear of creating an efficient, but ineffective, organization.

may stem from changes in the competitive, customer, economic, political/legal,
technological, and/or sociocultural environments.
The SWOT matrix:

allows the marketing manager to visualize the analysis.

should serve as a catalyst to facilitate and guide the creation of marketing strategies that
will produce desired results.

allows the manager to see how strengths and opportunities might be connected to create
capabilities that are key to meeting customer needs.

involves assessing the magnitude and importance of each strength, weakness,
opportunity, and threat.
Competitive advantage:

stems from the firm’s capabilities in relation to those held by the competition.

can be based on both internal and external factors.

is based on both reality and customer perceptions.

is often based on the basic strategies of operational excellence, product leadership, and/or
customer intimacy.
Establishing a strategic focus:

is based on developing an overall concept or model that guides the firm as it weaves
various marketing elements together into a coherent strategy.

is typically tied to the firm's competitive advantages.

involves using the results of the SWOT analysis as the firm considers four major
directions for its strategic efforts: aggressiveness, diversification, turnaround, or
defensiveness.

can help ensure that the firm does not step beyond its core strengths to consider
opportunities that are outside its capabilities.

can be visualized through the use of a strategy canvas where the goal is to develop a
value curve that is distinct from the competition.

is often done by downplaying traditional industry competitive factors in favor of new
approaches.

is an important stage of the planning process because it lays the groundwork for the
development of marketing goals and objectives and connects the outcomes of the SWOT
analysis to the remainder of the marketing plan.
Marketing goals:

are broad, desired accomplishments that are stated in general terms.

indicate the direction the firm attempts to move in, as well as the set of priorities it will
use in evaluating alternatives and making decisions.

should be attainable, realistic, internally consistent, and comprehensive and help to
clarify the roles of all parties in the organization.

should involve some degree of intangibility.
Marketing objectives:

provide specific and quantitative benchmarks that can be used to gauge progress toward
the achievement of the marketing goals.

should be attainable with a reasonable degree of effort.

may be either continuous or discontinuous, depending on the degree to which they depart
from present objectives.

should specify the time frame for their completion.

should be assigned to specific areas, departments, or individuals who have the
responsibility to accomplish them.