Whether you have a successful company with an established business plan, or you are just starting out by creating a business website , identifying and understanding your competitors are crucial elements of your strategy.
Start with the basics by learning how to start a business , then move on to discovering how to come up with a business name . Once you're set up, you'll need to do more research on your competitors and learn how to do a SWOT analysis.
SWOT analysis helps you improve your offering and pursue your marketing goals. In this guide, you'll learn how to do a SWOT analysis, what it is, and how to apply it to your own needs.
SWOT Analysis: Definition
A SWOT analysis is a strategy used by companies to objectively measure and evaluate their overall performance and that of their competitors. SWOT (Strengths, Weaknesses, Opportunities, Threats) is an acronym for Strengths, Weaknesses, Opportunities, and Threats. Each of these steps is analyzed for each company and its competitors.
SWOT analysis, definition: S and W (Strengths and Weaknesses)
The first two parameters, strengths and weaknesses, are internal factors within the company. These include reputation, team, location, and intellectual property. These factors are not necessarily permanent; it is up to the company to maintain or change them. So, if you want to make a positive change, you have to put in the effort and dedicate time to it.
SWOT Analysis, Definition: O and T (Opportunities and Threats)
Unlike the first factors, opportunities and threats are related to external elements. These include competitors, market trends and material prices. These are outside your company's control and therefore you cannot change them. However, a company must learn to work with these factors, take advantage of them and adapt its strategies to compete with other players in the industry.
Once you have understood the definition of SWOT analysis, you will have understood that it is a long process, used to make important decisions. For example, establishing yourself in a new field, in a new market, or even doing a rebranding. SWOT analysis can help companies to have a clearer vision of the situation and to define an appropriate action plan. In the context of implementing a customer loyalty strategy in particular, SWOT analysis will be essential.
How to do a SWOT analysis?
Below you will find the steps to follow to understand how to do a SWOT analysis and study both your business and your competitors.
Get a board, a piece of paper, or some other medium to take notes on. Create four sections for each step you will analyze. Label the sections in this order: strengths, weaknesses, opportunities, and threats. Then you can begin.
Note: For this analysis, especially for your own business, be objective. The more honest you are, the better your results will be.
How to Do a SWOT Analysis: 5 Steps to Follow
Analyze the forces
Analyze weaknesses
Analyze opportunities
Analyze threats
Draw conclusions and develop a plan
SWOT Analysis
1. Analyze the forces
Strengths are the skills a company possesses that give it a competitive advantage in its industry and benefit its customers. For your own company, identifying your strengths can help you work on them by making them stronger.
For your competitors, think of their strengths as a goal for yourself to achieve. Ask yourself, “How can I do what they do, but better?” Or “How can I create my own version of this idea to surpass theirs?” Here are some sample questions to analyze:
What are the competitive advantages of this company in the industry?
What features does it offer that are unique and useful?
What processes make it stronger?
What attracts customers?
Is it a market leader? If so, how did it do it?
Is it in a period of development and is it hiring new employees?
What are the company's assets (intellectual property, shareholders, buildings, etc.)?
2. Analyze weaknesses
These are the areas of your business that could be improved. You need to be honest with yourself, even if it's your own company. It can be a bit overwhelming at first, but if you don't identify your weaknesses, you won't be able to improve.
Note that many of the points analyzed in the strengths above can be addressed by analyzing weaknesses as well, but with an inverse meaning. For example, a strength could be “the growth of the company and the hiring of new employees”, while a weakness could be “the overload of some employees or the difficulties related to the onboarding of new talent”.
Consider all of your strengths, anticipating the weaknesses that might arise from them, then ask yourself the following questions:
What could this company improve?
What processes could be improved?
Does this structure lack visibility?
What are the company's challenges compared to other players in the industry?
What do customers often complain about?
Is the organization losing employees?
What resources does the company lack (licenses, financing, securities, etc.)?
3. Analyze opportunities
When you run a business, you have to seize the moment. Opportunities are probably the same for you and your competitors. Recognizing them is the first step, and seizing them before your rivals is the second. You have to act at the most favorable time for your business, depending on its stage of development.
Here are some questions to ask yourself:
What’s the latest trend? A green initiative to use recycled packaging or collaborating with social media influencers to promote you?
What are some upcoming events that you can take advantage of? For example, a trade show, a meet-up or a press release.
Is there a gap in the market? Like a cheaper supplier or the ability to cut out the middleman.
Can you move to a bigger building or better location?
Could the company be sold? Or, on the contrary, could it buy smaller local structures to expand?
4. Analyze threats or risks
The last step in learning how to do a SWOT analysis is to analyze risks. Risks are external factors that can negatively impact the business. And just like opportunities, risks are often the same for you and your competitors.
But some threats may be specific to a particular company—a public relations scandal or an unhappy customer. You need to know how to address them and prevent them from escalating.
Note: Although threats come last in the SWOT analysis, it might be wise to bosnia and herzegovina phone number list address them first. Like a small fire, if you don't act quickly, threats can sometimes cause irreparable damage.
Is a customer dissatisfied with a product or service?
Is the market fluctuating? Are prices falling? Are consumers looking for alternatives?
Are there any new regulations in force?
Who are the new competitors and what are they doing better? Where could you find information about their activities?
Will new technologies be released in the near future that could make the company's products or services obsolete?
Are consumers still showing interest in these services?
5. Draw conclusions and make a plan
Now that you know the most important elements that can impact your success or that of your competitors, you have the tools necessary to develop a strategy. This tactic will allow you to make changes within your company and compete with your opponents.