The Benefits of SWOT for Your Business

If you haven’t heard of or thought about a SWOT analysis since your first year of university, we understand! A SWOT analysis is often overlooked by business owners and marketers and replaced with more complicated marketing strategies. In today’s blog, let’s look into the benefits of SWOT and how you can apply them to your business marketing strategy and maximise your marketing ROI.

What is a SWOT Analysis?

A SWOT analysis is a simple method of analysing the internal and external factors affecting a business’s competitive position.

SWOT is broken down into Strengths, Weaknesses, Opportunities and Threats.

Strengths and weaknesses highlight the internal factors; these can include:

• Business Structure
• Procurement
• Stock
• Processes
• Budget
• Reputation
• Technology
• Skills within the business

Whereas opportunities and potential threats move on to focus on external factors of the business environment:

• Consumer behaviour
• Industry changes
• Legislation changes
• The economy
• Growth and decline of markets
• Intensity of competition

Strengths

These are the qualities and traits at the core of your business are directly connected to its success and give you a competitive advantage. They can be physical or nonphysical factors.

These core strengths may include large financial resources, a loyal customer base, and dedicated employees.

Weaknesses

These are the internal weaknesses and areas of improvement within your team and business. The qualities that you recognise need to be improved to help the business as you continue to grow.

Weaknesses can include debt, poor communication, stocking issues and demotivated staff.

Opportunities

These are growth opportunities based on external opportunities, which can come from the industry, competitors or technology changes.

You take advantage of these things quickly as the resource already exists. this may include new technology to speed up processes, a failure or downturn of competitors, or market trends that are pretty easy to implement.

Threats

This looks at external threats that are potential risks that lie out of your control, but to remain successful, you need to address and prepare for them.

Threats can include increased competition in the industry, rising costs, and changes to legislation. All of these factors are unavoidable for the business but need to be reviewed and strategised around.

What are the Benefits of SWOT?

Now that we’ve highlighted the need for a SWOT analysis in all business let’s unfold the key advantages and the reasons you should make the most.

Simple and Cost-effective

The structure and layout of a SWOT analysis is straightforward. This makes it accessible for everyone in your business to understand by simply glancing at it.

This saves your business training time and extra resources to help employees understand the format before you even get into the nitty-gritty of it all.

Internal factors

It’s easy to focus on the external factors affecting your business, but as a business owner or employee, it can be hard to focus the lens on yourself.

By refocusing your attention on the internal strengths and weaknesses of the business, you can clearly define the areas for improvement across the business.

For example, if one of your strengths is an advanced tech stack but a weakness is a lack of skills within the business to use the tech. This gives you a clear action plan to increase the training around technology to scale up the knowledge of current employees, making the business more efficient.

Promotes Discussion

Often, in larger businesses, there is a lack of discussion from team members. This SWOT analysis model makes it hard to complete without the valuable insights from other team members.

A SWOT analysis can be the perfect opportunity for heads of departments to get together and discuss their department and what they need from other departments to help them improve their processes.

Produces Actionable Next Steps

A SWOT analysis is an effective tool for preemptive risk management by identifying the internal issues and external controllable and uncontrollable factors. All of these points can help make informed decisions and build a clear action plan to move forward.

Weaknesses are often easier to deal with as they come from internal factors. Actionable steps from this point are often linked to training, recruitment, marketing and finance.

Potential threats and opportunities are a bit further out of your control. However, steps can still be taken to futureproof your business despite the external environment.

For example, if you can already see the growing intensity of competition, you can put a plan in action to create a new product unique to your business to get ahead of the curve.

Can Tailor to Channels and Projects

A SWOT analysis isn’t only for your business as a whole; it can be split into channel, project or product/service specifics.

This changes the frame on what would fall into each section of the SWOT analysis as you change it to focus more specifically on what you have in the works.

SWOT Can be Used for Competitors

It’s not always about you; running a SWOT analysis on some close and direct competitors can be a great way to see where they excel and what you define as the threats and opportunities for them to continue to grow. It is another example where the goalposts slightly change for each SWOT section as you can only see the strengths and weaknesses of a competitor as an outsider, but every bit of knowledge and research adds to it.

This is another great way to get actionable next steps from a SWOT analysis. Check which competitors have strengths where you have weaknesses and see what you can learn from that.

Our Final Thoughts

To conclude, let’s round up everything we have discussed:

• A SWOT analysis is a simple yet effective method of reviewing internal and external factors affecting your business
• By bringing your team together to discuss a SWOT analysis, you may learn a little bit more about your business than you thought
• You can tailor your analysis however you like; this method can be used to analyse projects, services, products, and competitors.

If your business strategy includes SEM and you need more guidance, speak to the ROAR team and see how we can help turn clicks into customers.