Generally, as your business grows, you face more obstacles, challenges, opportunities, and projects. It’s a good and natural part of scaling an organization, but how do you determine your priorities? What initiatives should you take first and what challenges should you address immediately?
Take part in SWOT Analysis, a framework that will help you develop a roadmap to move your business forward, maximize opportunities and minimize obstacles along the way.
What is a SWOT analysis?
A SWOT analysis is a strategic planning technique that puts your company into perspective based on the following perspectives: strengths, weaknesses, opportunities and threats. Using a SWOT analysis, you can identify areas where your business can improve and maximize opportunities while pinpointing negative factors that could affect your chances of success.
While it may seem simple at first, a SWOT analysis allows you to make unbiased assessments about:
- Your company or your brand
- Market positioning
- A new project or initiative
- A specific campaign or channel
The SWOT framework can be applied to practically everything that requires internal or external strategic planning in order to avoid unnecessary errors due to a lack of insight.
Importance of SWOT analysis
You have now noticed that SWOT stands for strengths, weaknesses, opportunities and topics. The framework seems so simple that you would be tempted to forego it at all and instead rely on your intuition to account for these things.
But you shouldn’t. A SWOT analysis is important because:
- It gives you a chance to worry and dream. Adding SWOT analysis as an important step in your strategic process will give yourself the space to dream, evaluate, and worry before taking action. Your insights into these will then become assets when you create the roadmap for your project or initiative.
- It forces you to define your variables. Instead of diving head first into planning and execution, do an inventory of all your assets and roadblocks. These can help you create a more specific and effective roadmap.
- You can think more critically and consider mitigating factors. By identifying vulnerabilities and threats, you can better incorporate them into your roadmap and improve your chances of success.
- It will help you keep a written account. As your organization grows and changes, you can delete your old SWOTs and add new things as the industry changes. It can be instructive to look back at where you started while looking ahead to what is to come.
Here’s how to best do a SWOT analysis, provide a SWOT analysis template, and do SWOT analysis for key Apple and Starbucks brands. By the time you finish reading you will have all the inspiration and tactical advice you need to do a SWOT analysis for yourself.
How do you write a good SWOT analysis?
There are several steps you might want to take in order to evaluate your business and conduct a strategic SWOT analysis.
1. Download the SWOT analysis template from HubSpot.
You don’t have to start from scratch for your analysis. Here I’ve created an example using a free, editable template. You can also use the model yourself or create your own to suit your needs.
Download a free, editable SWOT analysis template.
2. Arrange each section in a four-quadrant table.
Whether you are using the above template as a model or creating your own template to suit your needs, it can be helpful to start in tabular format to visualize your SWOT analysis. This can be achieved by arranging each of the four sections into separate quadrants.
3. Identify your goal.
Before you start writing things down, you need to find out what you are evaluating with your SWOT analysis. Be specific with what you want to analyze. Otherwise, your SWOT analysis may be too comprehensive and you will get analysis paralysis when doing your assessments.
Whenever you create a social media program, you want to do some analysis to inform your content creation strategy. When you launch a new product, you want to understand its possible positioning in space. When considering a brand redesign, consider existing and future branding concepts.
These are all examples of good reasons to do a SWOT analysis. By identifying your goal, you can adjust your assessment to provide more actionable insights.
3. Identify your strengths.
“Strengths” refers to what you are doing well at the moment. Think about the factors that speak in your favor as well as the things that your competitors simply cannot beat.
Let’s say you want to use a SWOT analysis to evaluate your new social media strategy.
When looking at a new social media program, you might want to evaluate how your brand is perceived by the public – is it easily recognizable and known? Even if it’s not popular with a widespread group, is it particularly well received by a certain audience?
Next, think about your process: is it effective or innovative? Is there good communication between your marketing and sales team to ensure that both departments use similar vocabulary when discussing your product?
Finally, rate your social media message and specifically how it differs from the rest of the industry. I’m ready to bet you can make a long list of some of the key strengths of your social media strategy over your competitors. So try to dive into your strengths from there.
4. Identify your weaknesses.
What obstacles, similar to your strengths, prevent you from achieving your goals? What are your competitors offering that you continue to be a thorn in your side? This section is not about being a negative Nancy. Rather, it is important to anticipate potential obstacles that could reduce your success.
When identifying vulnerabilities, consider which areas of your business are the least profitable, where you are lacking certain resources, or what is costing you the most time and money. Accept contributions from people in different departments as they are likely to discover weaknesses that you have not considered.
When considering a new social media strategy, the first questions you may ask yourself are: What would prevent me as a consumer from buying this product or engaging in this business? What would make me click away from the screen?
Second, what do I see as the greatest hindrance to my employees’ productivity or their ability to do their work efficiently? What derails their social media efforts?
5. Consider your options.
This is your chance to dream big. What opportunities for your social media strategy would you like to achieve, but not necessarily expect?
For example, maybe you are hoping that your Facebook ads will attract a new, larger demographic. Perhaps you’re hoping your YouTube video gets 10,000 views and increases sales by 10%.
Either way, it is important to include potential opportunities in your SWOT analysis. Ask yourself these questions: What technologies should my company use to make it more effective? Which new target group do I want to reach? How can business stand out better in the current industry? Is there anything our customers are complaining about that we could fix with our social media strategy?
The opportunities category goes hand in hand with the weaknesses category. Once you have a list of vulnerabilities it should be easy to make a list of potential opportunities that can arise as you address your vulnerabilities.
6. Look at your threats.
Especially if you are worried, you probably already have a good list of threats in mind.
If not, gather your staff and brainstorm: What obstacles could be preventing us from meeting our social media goals? What is going on in the industry or with our competitors that could reduce our success? Are there any new technologies that could conflict with our product?
Writing down your threats enables you to objectively assess them. For example, list your threats according to the lowest and most likely occurrence, and divide and conquer each one. If one of your biggest threats is your competitor’s popular Instagram account, then you can work with your marketing department to create content that shows off your product’s unique capabilities.
Examples of the SWOT analysis
With the template above you can start your own SWOT analysis.
However, if you are like me, seeing a template is not enough. To fully understand a concept, you need to see how it plays out in the real world.
These SWOT examples are not meant to be exhaustive and I’m sure you could add a few yourself, but hopefully it will be enough to inspire you on your own SWOT analysis.
Apple’s SWOT analysis
This is how we do a SWOT analysis for Apple.
First of all, strengths. While Apple has many strengths, let’s identify the three most important ones:
- Brand perception
- High prices
- Innovative Products
Apple’s brand is undoubtedly valuable, and their business is considered the most valuable in the world. Because Apple is easy to identify, it can make new products and almost ensure some success thanks to the brand name itself.
This level of recognition is appropriate for Apple’s ability to sell products. For example, Apple sold 72.9 million iPhones in 2019 compared to 70 million Samsung Galaxy phones. This is despite the price differences between the two (the flagship Galaxy phone is $ 100 cheaper). Often people are less interested in price than in brand awareness.
Finally, their innovative products: Apple has not earned its reputation for nothing. They create highly innovative products that are often at the forefront of the industry.
Next, let’s look at three of Apple’s weaknesses.
- High prices
- Closed ecosystem
- Lack of experimentation
While the high prices don’t scare off Apple’s mid-range and upper-tier customer base, they do hamper Apple’s ability to reach a lower-tier demographic.
Apple also suffers from its own exclusivity. Apple controls all of its services and products internally. Many customers become loyal brand advocates for this reason. However, this means that all of the burdens will be placed on Apple employees.
Ultimately, Apple’s tight control over who sells its products limits market reach.
After all, Apple has a high standard of creating and distributing products. Apple’s brand is held in high regard, but that level of recognition prevents Apple from taking risks and freely experimenting with new products that might fail.
Now let’s look at the possibilities for Apple.
When you consider Apple’s weaknesses, you can easily spot areas for improvement. Here is a list of three we came up with:
- Expand the distribution options
- Create new product lines
- Technological progress
One of Apple’s biggest weaknesses is its distribution network, which in the name of exclusivity remains relatively small. If Apple expanded its network and allowed third-party companies to sell its products, it could reach more people around the world while reducing the stress that is currently on in-house employees.
Apple also has many opportunities to develop new products. Apple might consider making cheaper products to reach a larger demographic or expanding into new industries – Apple self-driving cars maybe?
After all, Apple could develop the technology of its products further. Apple can adopt and refine existing products to ensure that each product has as many unique features as possible.
Finally, let’s take a look at the threats to Apple.
Believe it or not, they exist.
Here are three of the biggest threats to Apple:
- Tough competition
- International issues
Apple isn’t the only cutting edge tech company out there, and it continues to face stiff competition from Samsung, Google, and other key forces. Many of Apple’s weaknesses hamper Apple’s ability to compete with technology companies that have more freedom to experiment or do not operate in a closed ecosystem.
Lawsuits are a second threat to Apple. Apple has faced a number of legal disputes, particularly between Apple and Samsung, and has only won one case to date. These lawsuits damage Apple’s reputable image and can lead some customers to shop elsewhere.
After all, Apple needs to improve its reach internationally. It’s not number one in China and doesn’t have a very positive relationship with the Chinese government. In India, which has one of the largest hypermarkets in the world, Apple’s market share is small and the company is struggling to get business into the Indian market.
If Apple can’t compete as globally as Samsung or Google, it risks falling behind in the industry.
Starbucks SWOT Analysis
Now that we’ve dealt with the nuances of a SWOT analysis, let’s fill out a SWOT template using Starbucks as an example.
Here’s how we’d fill out a SWOT template if we were Starbucks:
Dine-In Thai Restaurant SWOT Analysis
Some small business marketers may struggle to relate to the SWOTs of big brands like Apple and Starbucks. Here is an example of how a restaurant can visualize each element:
While a Thai or other restaurant might not be as concerned about high-profile lawsuits as Apple, the small business might be more concerned about competitors or disruptors that may be on the field.
Local boutique SWOT analysis
In another small business example, a local boutique may be known in their neighborhood, but it may also take time to establish an online presence or to have their products available in an online shop. Because of this, some of its strengths and opportunities may relate to physical factors, while weaknesses and threats may relate to online situations.
When is a SWOT analysis used?
Ultimately, a SWOT analysis can measure and address both large and small challenges and opportunities as well as large and small strengths and weaknesses.
While the examples above focus on businesses in general, you can also use SWOT analysis to evaluate and predict how an individual product will perform in the marketplace.
Hopefully our SWOT template complements your market research and business analysis and provides fair insights into optimizing your products for higher profits and fewer hurdles.
Editor’s note: This post was originally published in May 2018 and has been updated for completeness.