Before delving into your marketing strategy, you need to consider the current stand of your business and brand, where your business currently is. Your business strategy should ask the questions:‘ What is the business challenge we are facing that prevents us from making more revenue?’ or, ‘What business objective should we strive for in order to increase the money in the bank?’
Your brand is what results from your business strategy. It justifies why your business actually matter and what value it brings to people’s lives. The value of your brand to your target market is being measured based on your brand equity – how aware are people of the brand? Does it hold positive associations and perceived value? How loyal are people to the brand? When you have the answer to this question, you can formulate a marketing strategy to address the challenge or objective you’ve discovered. (Reference: Essential Guide to E-Marketing)
With your marketing strategy, you can address your revealed business or brand challenge. This involves making an appropriately informed decisions about the best approach you’ll take to promote your brand, product and services. And to be strategic at making these decisions, you need to understand the context within which your business operates: What factors affect our business? This really requires you conduct a situational analysis.
A situational analysis is a critical review of your current business situation. It serves as a starting point for your marketing plan. Any worthwhile project begins with a careful analysis of your starting point, and marketing is no exception. You need to be clear and realistic about your current product, market, opportunities, and challenges so that you can devise a clear path from your current to your desired situation. To put together a situational analysis, you’ll need to gather information about your product and the market you sell it in, including its size, the competitors, and the customers who purchase it. There are some questions you can ask to help you organize your information.
Here are some considerations and tools for conducting your brand’s situational analysis.
1. Understanding Your Market Environment
This helps you understand the external factors that will influence your marketing goal. The context within which your business operates. The environment is the overall context or ‘outside world’ in which the business functions. It can involve anything from global economics (how well is the local currency performing these days?) to developments in your industry. Every brand will have a specific environment that it needs to consider, based on the type of product or service it produces.
Questions to ask related to your market environment include:
- What is the market for your product? Define it in terms of size in dollars.
- What growth do you anticipate in the market?
- What factors do you see impacting your market? Are there anticipated changes in where people live, average age of the population, environmental regulations, political climate, or other factors that may lead to a change in the size of your market?
To Best Understand Your Business Environment, It’s always recommendable you conduct PESTLE Analysis.
An analysis of the business and brand environment will typically consider political, economic, social, technological, legal and environmental (PESTLE) influences to identify a clear set of considerations or issues pertinent to the marketing strategy. The PESTEL analysis is a framework or tool used by marketers to analyse and monitor the macro-environmental (external marketing environment) factors that have an impact on an organisation. The result of which is used to identify threats and weaknesses which is used in a SWOT analysis.
2. Understanding Your business and Product
What are the special things about your brand that make it marketable and unique?’ There are several marketing models that can be used to understand the business and brand you are working with. Since it’s essential for all marketing messages to encapsulate the brand’s identity and objectives, this is a very important step. A crucial consideration is the brand itself. What does it stand for? What does it mean? What associations, ideas, emotions and benefits do people associate with it? What makes it unique?
Questions to ask related to your Brand and Its product include:
- What are your company’s capabilities and expertise?
- What is your company’s brand and culture?
- How is its financial situation?
- What is your company’s current product(s)?
- What is the nature of your products or services?
- Do they meet the needs and wants of the customers?
- What are the complementary goods and the substitutes
- What is their price point relative to competitors?
- What is your product’s market share?
- What position in the market does your product take? High quality? Lowest price?
- Where do you purchase your product or its components? Are there other options for sourcing?
- How do you get your product to the buyer?
For you to be able to understand your business and products properly, you would need to conduct SWOT Analysis and 5C’s Analysis.
A SWOT analysis is an assessment for a business, which concerns four aspects: Strengths, Weaknesses, Opportunities, and Threats of a company. Based on its scale, all elements in a SWOT analysis can be listed in two groups internal and external analysis. Internal analysis, consisting of strengths and weaknesses, refers to any aspects within the business such as company culture, organizational structure, employees, company’s capacity, brand awareness, financial resources, and so on. In contrast, external analysis, which concerns opportunities and threats for the company, focuses on identifying external factors influencing the development of business.
The 5C’s involve in-depth knowledge of the company, competitors, customers, collaborators and climate. You start by focusing on the company’s mission, vision and goals, its position into the market (which we can easily evaluate through the marketing mix), its performance in order to identify how successfully is the business fulfilling their goals and strategies, and the last one consisting in its product/service line. The use of 5C analysis enables you to take a bigger and more detailed look to their businesses. This method is the most effective when used to analyze the marketplace outside your company.
Out of this, you can determine what the brand or product’s unique selling point (USP) is. A USP is the one characteristic that makes your product or service better than the competition’s – what unique value does it have? Does it solve a problem that no other product does?
3. Understanding Your Customers:
In order truly to understand your customers, you need to conduct market research. Try not to make assumptions about why people like and transact with your brand – you may find their values and motives are quite different from what you thought. Ongoing research will help you build a picture of what particular benefit or feature your business provides to your customers, allowing you to capitalise on this in your marketing content.
One important area on which to focus here is the consumer journey – the series of steps and decisions a customer takes before buying from your business (or not). Luckily, online data analytics allow you to get a good picture of how people behave on your website before converting to customers; other forms of market research will also help you establish this for your offline channels.
Questions to ask related to your customers include:
- How are your customers segmented?
- What are your target customers? (Identify segments – segment size, growth rate, percentage of market, demographics & reason why they buy)
- What are the customers’ needs and wants? (Identify key needs)
- How’s the price sensitivity of each customer’s segment?
- What’s the distribution channel preference by each segment?
- How’s the customer concentration and power?
To be able to understand and target your customers properly with the value most suited for their need, you’ll need to conduct both STP analysis and 4Ps market mix analysis so as to understand your target market and then position your products to each segment.
The STP process demonstrates the links between an overall market and how a company chooses to compete in that market. This three stage process involves analysing which distinct customer groups exist and which segment the product best suits before implementing the communications strategy tailored for the chosen target group. It is sometimes referred to as a process, with segmentation being conducted first, then the selection of one or more target markets and then finally the implementation of positioning. The goal of the STP process is to guide your organization to the development and implementation of an appropriate marketing mix.
4Ps MARKET MIX:
The Four Ps market mix help you structure the components that make up a brand’s offering, differentiators and marketing. These components of your marketing process include: product, place, price and promotion. They have been fundamentally changed by the Internet and need to be looked at in the context offered by digitally connected media and from the perspective of the consumer. How your brand is positioned in the mind of your consumer will ultimately determine your success. The goal is to reach customers with the right marketing message at the right stage of their journey.
4. Understanding Your competitors
Finally, it’s important to know who else is marketing to your potential customers, what they offer, and how you can challenge or learn from them. On the Internet, your competitors are not just those who are aiming to earn your customers’ money; they are also those who are capturing your customers’ attention. With more digital content being created in a day than most people could consume in a year – for example, over 100 hours of video are uploaded to YouTube every minute (YouTube, 2013) – the scarcest resources these days are time, focus and attention.
When considering competition, it’s also worthwhile looking at potential replacements for your product. The Internet is disrupting and accelerating the pace of disintermediation in a number of industries, meaning that people can now go directly to the business instead of transacting through a middleman (look at the travel industry as an example). To stay ahead, you should be looking at potential disruptors of your industry as well as the existing players.
Questions to ask related to your Competitors include:
- Who is your competitor?
- What’s your competitor’s market share concentration?
- How’s their behaviour (target segment, product, pricing and distribution)?
- What are their best practices? Are they doing things we don’t do?
- Do we need to worry about new entrants to the market?
- What comparison can we give to our business with respect to our competitors?
- How intense is the competition in your market?
The two major analysis and frameworks you need to consider while evaluating your competitors are SWOT analysis of Your competitors and Porter five Forces Analysis.
PORTER FIVE FORCES:
Porter’s Five Forces analysis is a business tool that helps determine the competitive intensity and attractiveness of a market. The Internet’s low barrier to entry means that many new businesses are appearing online, providing near-infinite choices for customers. This makes it important to consider new factors when devising a marketing strategy. This method is often applied to identify threats from environment, competitors, and any problems outside the company. Besides, this model also helps in comparing and examining your business’s profitability and position in the industry with their competitors.
No matter if you are planning to introduce a new service/product in the market, or if you are in the need of finding which are your strengths and weaknesses regarding your own company, a micro as well as macro environmental factor analysis can indicate the strategies which you should follow. This is the purpose of the situation analysis. Involving several methods of analysis, this concept guides businesses on how to communicate the benefits of their products to the needs of the potential customers. Once you have a clear sense of what the business challenge or objective is, and you have defined how your marketing strategy will work towards fulfilling it, you can start thinking about your marketing strategy