Escolar Documentos
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Elements of the situation
analysis
– External Strategic Environment
• Industry
• Competition
• Trends
– Globalization
– Demographic change
– Technology
– Social/Political/Economic issues
Problem identification
• A brief statement that summarizes the
core dilemma and/or challenge a
company must overcome
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Company analysis
• What the company is concerned with
• What it represents
– Usually this information is found in the
mission and vision of the corporation
Product analysis
• Focuses on the abstract and concrete qualities
of the company’s product
– Product attributes/functions/Lifecycle
– Positioning/Brand personality
– Cost/Margins
– Price
– Packaging
– Distribution
– Promotions used
– Media spent
• Sources: Ad Spender, Company’s Web site, your
research, check consumer sources.
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Situation Analysis: Strategic
Consumer Insight
Consumer analysis
• Information that helps us gain a grasp on the
(current/potential) consumer
• Major questions to be answered
– Who are they?
– What motivates them to buy?
– How do they use the product?
– What is important to them in a product?
– How do they look at life?
– Where are they?
• Sources: Factiva (news articles), Mintel Euromonitor,
MRI, Market Research.com (academic)
Market analysis
• Helps planners identify which
geographic areas are key
• These areas are important due to:
– The strong position the advertiser enjoys in
the region
– The problems associated with doing
business in the region
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Market analysis: Development
index
• Brand development index (BDI)
% of a brand’s total US sales in a market x 100
= BDI
% of total US population in a market
A B
Population = 10 Population = 40
$ of soft drinks = 10 $ of soft drinks = 15
$ of Coke =5 $ of Coke = 5
C D
Population = 30 Population = 20
$ of soft drinks = 20 $ of soft drinks = 5
$ of Coke = 2.5 $ of Coke =5
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Industry
• An industry is defined by
– Products
• Function: Restaurant (Serve food)
• Technology: Fast food/Fast casual
– Customers
• Segmented groups
– Geography
Industry
• Growth
• Profitability
• Size of market
• Product differentiation
• Distribution channels
• Product life cycle
• Number of competitors
• Size of competitors
• Sources: Standard & Poor’s, Business
Insight, Company sources.
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Strategic ramifications of PLC
Characteristic Emerging Growth Maturity Decline
Competitive analysis
• Considers all options consumers might
think about in their purchasing decision
Competition I am thirsty!
Categories
• Alternatives on
a person’s Soft drink Beer Sports drink Milk
mind when
selecting a
Carbonated Non-carbonated Water Indirect
good to satisfy competitors
a need
Direct Pepsi Bottled
competitors
Coke Tap
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Competitive analysis
• In what category does the product
compete?
• Who are the brand’s major direct
competitors? Indirect competitors?
• What is the competitor’s brand position?
• What is the price of their product?
Trends
• Globalization
– Free flow of trade, information
– Technology driven
– Effects
• Companies are looking for new international markets
• Higher risk
• Global, regional vs. local approaches
• Demographic change
– Birth rate, age, immigration, minorities, working
population.
– Effects
• Market size
• Type of consumers
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Trends
• Technology
– Internet, digital media.
– Effects
• Fragmentation of markets
• New distribution channels
• Other trends
– Social
• Roles of females, minorities and pop culture,
overburdened families.
Trends
• Other trends
– Political
• Regulation
– Economic
• Inflation
• Exchange rate
• Economic activity
• Employment
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A word about sources
• Primary sources:
– Quantitative:
• Experiments
• Surveys
– Qualitative
• One on one interviews
– Consumers
– Employees
– Competitors
• Focus groups
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SWOT analysis
Advertising Strategy
What is a SWOT?
• It is the organization of the information
obtained in the situation analysis:
– The company’s
• Strengths
• Weaknesses
– The environment’s
• Opportunities
• Threats
• Answers the so what? Of the situation
analysis
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A good SWOT
• Has a focus: Maybe more than one
analysis
• Searches extensively for competitors
• Does not forget other areas of the
company
• Thinks as the consumer (internal/external)
• Separates clearly internal from external
sources
Strengths
• Strengths refer to what a company has
done well or been successful at to date.
• Examples
– Starbucks’ innovation
– Wal-Mart's cost efficiency
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Weaknesses
• Weaknesses refer to what a company
needs to correct or that has worked to a
company’s disadvantage to date.
• Examples
– Oldsmobile’s name
– Lenovo’s image in the USA
Opportunities
• Opp. refer to external factors that may
benefit the company if pursued.
• Examples
– Oil prices are high
• ExxonMobile’s profit this quarter: $78.6 billion.
– US consumers are more worried about
their physical appearance
• Protein Plus
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Threats
• Threats refer to external variables that may
negatively affect the company if ignored
• Examples:
– Oil prices are high
• Independent gas stations receive a constant rate per
gallon (not %) from oil companies.
– US consumers are more worried about their
physical appearance
• McDonald’s
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Where do we go from here?
• Strategic planners should understand
what the company’s alternatives are for
solving the market challenge
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