© 2012 Pearson Education, Inc. publishing Prentice Hall. Note 25 SWOT Analysis.

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Note 25SWOT Analysis

Figure Note 25-1 - SWOT Analysis Identifying Strengths and Weaknesses

Customer Assessment

External forces represent opportunities or threats because of the changes they produce in the way customers meet or can possibly meet a need

Considering and continuously reconsidering customer assessment and segmentation is essential to identifying opportunities and threats

Segment Changes

Market segments are never static Segments grow, shrink, and change their buying habits,

preferences, and buying criterion Segments can split into subsegments or can merge or

combine into a single, larger segments

Environmental Scanning

Wherever an opportunity or threat arises, monitoring the environment is essential to feed understandings of changes, trends, and events to SWOT analyses

Figure Note 25-2 - Strategic Implications of SWOT Analysis

Conducting a SWOT Analysis

Assess the firm’s competitive advantages Study the environment for opportunities and threats Identify strategic alternatives and imperatives from the

“fit” or match between the strengths and weaknesses and the opportunities and threats

Prioritize, plan, and act

Figure Note 25-4 - Strengths and Weaknesses, Opportunities and Threats Drive Strategies

Note 26Targeting & Positioning

Introduction

After a company has segmented its markets and has developed detailed segment profiles, two important decisions have to be made: Should the company adopt a differentiated or

undifferentiated marketing approach? If it adopts a differentiated marketing approach, which

segments should be targeted?

Undifferentiated Versus DifferentiatedMarketing Approaches

Undifferentiated marketing Ignores segment differences and applies a “one-size-fits-

all” approach This leads to benefits from economies of scale in research

and development, production, advertising, distribution, and other overhead expenditures

Simplifies organizational structures

Differentiated marketing A company develops adapted or customized marketing

mixes for different target market segments It can better meet the segment-specific needs and

requirements Creates superior value and demand price premiums

The downside of differentiated programs The higher complexity of the organization and of the

product portfolio The diluted benefits of scale The higher per-unit costs

Differentiated marketing can consist of: Selected specialization Segment specialization Product specialization Full market coverage

Figure Note 26-1 - Differentiated Marketing Approaches

Target Market Selection

Criteria for segment attractiveness are defined, they are weighted and evaluated

Analyze whether a company has competitive advantages in the individual segments

The weighted scores of segment attractiveness and competitive advantages are used to position each segment in a portfolio

Target Market Selection

Additional criteria can be used: Synergies Core competences Strategic objectives

Positioning

Positioning requires a thorough understanding of: The needs of the target market Competitor’s positions in the target market The firm’s own competitive advantages and points of

differentiation

Specific Tools for Positioning

Marketing concept

Marketing concept - firms will be most successful at achieving goals when they orient around the consumers’ needs and align the entire organization around satisfying those needs

Market orientation - a firm wide customer and competitor focus and coordination of activities

Table Note 15-1 - Needs, Motives, Wants, and Demand

© 2012 Pearson Education, Inc. publishing Prentice Hall. Note 25 SWOT Analysis.

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