Join Drew Boyd for an in-depth discussion in this video Writing the situation analysis, part of Writing a Marketing Plan.
- Before you venture out into the marketplace with your products and services you've got to have a realistic understanding of where you are today, after all you don't want to pick a fight with your competition until you know what you've got to fight with. This part of the plan is called the situation analysis, there are four parts to it. First is the market analysis, analyzing a market means estimating how many potential customers you might be able to sell your products and services to.
When an analyzing any market you want to group customers into three types, first are the customers that already buy from you today, second are customers that buy the same products and services you offer but from a competitor, and third are potential customers that might be interested in your type of products and services but not buying from anybody. Now, estimate the potential number of customers that you might be able to capture for each of the three groups.
You do this so you can decide where you want to concentrate your marketing strategy. In marketing it's the old adage, fish where the fish are. Next, you want to analyze how your company compares to your competition. A good tool for this is called the competitive matrix, like the one you see here. To create a matrix list your company and your competitors across the top, then down the side list the things that you want to compare, things like size, market share, strengths and weaknesses, and especially the key strategy elements like the value propositions.
What does each company have in terms of key resources, and how do they use those resources to acquire and retain customers. Now let's look at your customers, customers buy things for a variety of reasons, but some are more important than others. If you know what's most important to them you can appeal to that need when trying to get them to buy, or you can try to raise the sense of importance they place on another factor. You also need to measure how they rate your product versus others in how it delivers each benefit.
They may have misperceptions that you need to change. You may be able to emphasize a key feature of your product that is better than your competition. This analysis will be critical later when you begin segmenting customers. To complete the situation analysis you need to test the features of your product and services compared to the same features on your competitors. You need to determine which features perform better than the competition, which perform the same, and which perform not as well.
When you complete the analysis take a close look, are there features that need to be improved, are there certain competitors you want to avoid, or possibly go after based on product performance? Now keep in mind that the data and information that you put into the situation analysis doesn't have to be perfectly accurate, it just needs to be realistic that allows you to step back and see what customers to go after, what to emphasize when marketing to them, and what competitors to go after or avoid.
The situation analysis is an important step so you want to take your time here. A good technique is to leverage the team you created to write the plan. I suggest you break the situation analysis into the various sections, and assign the writing of each section to the team member most qualified to do it. Having a good understanding of your situation can go a long way to setting you up for success as you write your marketing plan.
- Planning for a marketing campaign
- Writing the situation analysis
- Writing the strategic, tactical, and budget sections of the plan
- Leveraging your plan