Various strategic frameworks

used in marketing
SWOT Analysis
• SWOT analysis is a strategic planning tool used by businesses and
organizations to assess their internal Strengths and Weaknesses, as
well as external Opportunities and Threats. The acronym "SWOT"
stands for Strengths, Weaknesses, Opportunities, and Threats. This
analysis involves identifying and evaluating the internal factors, such
as resources, capabilities, and limitations, as well as external factors,
including market trends, competition, and economic conditions. By
systematically examining these elements, businesses can develop
insights that inform strategic decision-making, helping them leverage
strengths, address weaknesses, seize opportunities, and mitigate
potential threats to achieve a competitive advantage in their
respective markets.
Purpose of SWOT Analysis
• The purpose of SWOT analysis is to help organizations understand their
strengths and weaknesses internally, and opportunities and threats externally.
It's a tool for making informed decisions and strategic plans. By identifying
what an organization does well (strengths) and where it needs improvement
(weaknesses), as well as recognizing potential growth areas (opportunities)
and possible challenges (threats), businesses can develop strategies to play to
their strengths, address weaknesses, seize opportunities, and mitigate
threats. Essentially, SWOT analysis guides organizations in making smarter
decisions and planning for the future.
Example of McDonald’s SWOT Analysis
PESTLE Analysis
• A PESTLE analysis is a strategic management tool that is used to
identify and analyze the external factors that can impact an
organization. The acronym PESTLE stands for Political, Economic,
Social, Technological, Legal, and Environmental factors. This analysis
helps businesses and other organizations understand the external
macro-environmental forces that may influence their operations,
decision-making, and overall success.
• Political Factors: These include government policies, regulations, stability, and political trends that may affect an
organization. Political factors can have a significant impact on industries such as energy, healthcare, and education.

• Economic Factors: Economic variables such as inflation rates, exchange rates, interest rates, and economic growth
can influence the financial health of an organization. Businesses often need to consider the economic conditions of
the markets they operate in.

• Social Factors: Social factors encompass demographics, cultural trends, social attitudes, and lifestyle changes.
Understanding social factors is crucial for businesses to tailor their products and services to meet the preferences
and needs of their target audience.

• Technological Factors: Advancements in technology, innovation, and the rate of technological change can impact
industries and organizations. Organizations need to stay abreast of technological developments to remain
competitive and efficient.

• Legal Factors: Legal factors involve laws, regulations, and legal frameworks that businesses must adhere to. This
includes employment laws, consumer protection, intellectual property laws, and other legal considerations.

• Environmental Factors: Environmental factors include issues related to sustainability, climate change, ecological
impacts, and environmental regulations. Organizations are increasingly expected to consider and address
environmental concerns in their operations.
Porter's Five Forces
• Porter's Five Forces is a framework for analyzing the competitive forces that
shape an industry and influence its profitability. Developed by Michael E.
Porter, a renowned strategy expert, this model helps businesses understand
the competitive intensity within their industry and devise strategies to
enhance their competitive position.

• Threat of New Entrants- This force assesses the ease with which new
companies can enter the market and compete with established businesses.
Factors that affect the threat of new entrants include barriers to entry (such
as high startup costs, brand loyalty, and economies of scale), government
regulations, and access to distribution channels.
• Bargaining Power of Buyers- The bargaining power of buyers
examines the influence that customers have on the industry. If buyers
have strong bargaining power, they can demand lower prices, higher
quality, or more services. Factors influencing buyer power include the
availability of alternative products, the level of product
differentiation, and the importance of each buyer to the overall
industry.
• Bargaining Power of Suppliers- Suppliers with high bargaining power
can exert pressure on an industry by raising prices, limiting quality, or
reducing the availability of inputs. Factors affecting supplier power
include the concentration of suppliers, the uniqueness of their
products or services, and the availability of substitute inputs.
• Threat of Substitute Products or Services This force considers the
availability of alternative products or services that could fulfill the same
need as those within the industry. The more alternatives are available, the
higher the threat of substitution, which can impact pricing and profit
margins.
• Intensity of Competitive Rivalry- Competitive rivalry assesses the level of
competition among existing firms in the industry. High rivalry can lead to
price wars, aggressive marketing, and innovation. Factors influencing
competitive rivalry include the number of competitors, industry growth
rate, and the level of differentiation among products.
BCG Matrix
• The Boston Consulting Group (BCG) Matrix classifies a company's
product portfolio into four categories: Stars (high market share, high
market growth), Cash Cows (high market share, low market growth),
Question Marks (low market share, high market growth), and Dogs
(low market share, low market growth). It is a strategic management
tool designed to help businesses analyze and categorize their product
or service portfolio based on two key dimensions: market growth rate
and relative market share. The purpose of the BCG Matrix is to
provide a framework for making strategic decisions about resource
allocation, investment, and growth.
• Stars - Gillette (Grooming Division): Gillette, known for its razors and
shaving products, could be considered a star. It likely has a high market
share in a high-growth market, given the constant demand for grooming
products. P&G may continue to invest in Gillette to maintain or increase its
market share and capitalize on the growing grooming market.

• Cash Cows - Tide (Fabric Care Division): Tide, a laundry detergent brand,
might be classified as a cash cow. Laundry detergent is generally a stable
market (low growth), but Tide has a high market share. P&G can generate
substantial cash flows from Tide with relatively low investment needs. The
cash generated can be used for other strategic initiatives or distributed to
shareholders.
• Question Marks - SK-II (Beauty Division): Olay, a premium skincare brand,
could be a question mark. It may have a lower market share in a high-
growth market (premium skincare), requiring P&G to decide whether to
invest more to increase market share or consider other strategic options.

• Dogs - Duracell (Battery Division): Duracell, known for batteries, might be

considered a dog. The battery market may have lower growth, and
Duracell might not hold a dominant market share. P&G might need to
evaluate the strategic options for Duracell, such as divestiture or
restructuring, unless there are specific reasons to keep it in the portfolio.
Ansoff Matrix
• The Ansoff Matrix helps in strategic planning by evaluating growth
opportunities. It considers four strategies: Market Penetration (existing
products in existing markets), Market Development (new markets for
existing products), Product Development (new products for existing
markets), and Diversification (new products for new markets).
Product Development: Tesla Electric Trucks
Definition: Creating and introducing new products to existing markets.
Example: Tesla's introduction of electric trucks, such as the Tesla Cybertruck,
represents product development. Tesla leveraged its expertise in electric
vehicles to create a new product category within its existing market,
targeting both individual consumers and businesses with a demand for
electric trucks.

Diversification: Amazon Web Services (AWS)

Definition: Introducing new products or services to new markets.
Example: Amazon Web Services (AWS) is a diversification strategy for
Amazon. Originally an e-commerce company, Amazon ventured into the
cloud computing market with AWS. This move allowed Amazon to tap into a
new industry (cloud services) while leveraging its technological capabilities
and infrastructure expertise.
Market Penetration: Starbucks
Definition: Increasing market share with existing products in existing markets.
Example: Starbucks constantly focuses on market penetration by opening new
stores in locations where it already operates. Additionally, the company often
introduces loyalty programs and promotions to encourage existing customers
to visit more frequently and spend more.

Market Development: Apple iPhone Expansion in China

Definition: Introducing existing products to new markets.
Example: Apple's expansion into the Chinese market with the iPhone is an
example of market development. By entering a new geography, Apple sought
to tap into a large and growing consumer base. This strategy involves
adapting marketing and distribution approaches to meet the needs of the
new market.
Blue Ocean Strategy
• Blue Ocean Strategy is a business strategy framework introduced by W.
Chan Kim and Renée Mauborgne that focuses on creating uncontested
market space, or "blue oceans," by simultaneously pursuing
differentiation and low-cost. In a red ocean, industries are characterized
by fierce competition, and companies strive for a competitive edge
within existing market boundaries. In contrast, a blue ocean represents
unexplored markets where a company can innovate and create new
demand by offering unique value propositions. This strategy encourages
businesses to move away from head-to-head competition and instead
seek innovation, differentiation, and the creation of new market spaces,
ultimately leading to sustained success and reduced competition.
Marketing Mix (4Ps/7Ps)
• The Marketing Mix, often referred to as the 4Ps (Product, Price, Place, Promotion),
is a fundamental framework in marketing that outlines the key elements a
company needs to consider when planning and executing its marketing strategy.
Over time, the 4Ps have been expanded to include additional elements, forming
the 7Ps.
• The purpose of the Marketing Mix, whether in its original 4Ps or expanded 7Ps
form, is to provide a structured framework for businesses to strategically plan and
execute their marketing efforts. By systematically addressing key elements—
Product, Price, Place, Promotion, and potentially People, Process, and Physical
Evidence—companies can create a cohesive and effective marketing strategy. The
Marketing Mix guides decisions related to product development, pricing strategies,
distribution channels, and promotional activities, enabling businesses to meet
customer needs, differentiate themselves from competitors, and ultimately
maximize their market presence and profitability. It serves as a valuable tool for
aligning marketing efforts with overall business objectives and fostering a
customer-centric approach to create and deliver value.