Portfolio Analysis and S.W.O.T Analysis

1. Portfolio Analysis and S.W.O.T Analysis Tools for Strategic Marketing Planning

2. PORTFOLIO ANALYSIS • Most corporations have multiple product lines and strategic business units. • Challenge: How can you effectively manage these various units? • Answer: You must manage these diverse units as a portfolio of SBUs • Portfolio theory was first developed in finance.

3. Strategic Business Units • Strategic business units (SBUs) share three characteristics: • Single business or collection of businesses which can be managed separately • Has own set of competitors • Has manager responsible for strategic planning and profits

4. SoBe Frappuccino Lipton Iced Tea Fruit Works juice Aquafina water Dole juices Gatorade Planet Java KMX energy drink Fruitopia Nestea Iced Tea Dasani water Powerade Odwalla Mad River Traders Who Owns Which Portfolio?

5. The BCG Matrix The Boston Consulting Group’s Growth-Share Matrix

6. The BCG Matrix

7. “A widely used framework for organizing and utilizing the pieces of data and information gained from the situation analysis…” SWOT Analysis

8. The SWOT Matrix

9. Strengths and Weaknesses (Internal) Scale and Cost Economies Size and Financial Resources Intellectual, Legal, and Reputational Resources Opportunities and Threats (External) Trends in the Competitive Environment Trends in the Technological Environment Trends in the Sociocultural Environment The Elements of a SWOT Analysis

10. Four issues the marketing manager must recognize: The assessment of strengths and weakness should look beyond products and resources to examine processes that meet customer needs. Offer solutions to customer problems instead of specific products. Achieving goals and objectives depends on transforming strengths into capabilities by matching them with opportunities. Weaknesses can be converted into strengths with strategic investment. Threats can be converted into opportunities with the right resources. Weaknesses that cannot be converted become limitations which must be minimized if obvious or meaningful to customers. SWOT-Driven Strategic Planning

11. Stay Focused It is a mistake to complete one generic SWOT analysis for the entire organization or business unit. Search Extensively for Competitors Brand, Product, Generic, Total budget competitors Directives for a ProductiveSWOT Analysis

12. Examine Issues from the Customers’ Perspective What do customers (and non-customers) believe about us as a company? What do customers (and non-customers) think of our product quality, customer service, price, overall value, convenience, and promotional messages in comparison to our competitors? What is the relative importance of these issues as customers see them? Taking the customers’ perspective is the cornerstone of a well done SWOT analysis. Directives for a ProductiveSWOT Analysis

13. Look for Causes, Not Characteristics Causes for each issue in a SWOT analysis can often be found in the firm’s and competitors’ resources. Major types of resources: Financial, intellectual, human, organizational, informational, legal, relational, reputational, etc Directives for a ProductiveSWOT Analysis

14. Separate Internal Issues from External Issues Failure to understand the difference between internal and external issues is one of the major reasons for a poorly conducted SWOT analysis. Socratic Advice: “Know thyself” “Know thy customer” “Know thy competitors” “Know thy environment” Directives for a ProductiveSWOT Analysis