Le marketing externe et interne version anglais

Class 03

Internal and External Analysis and How to Analyze a Business Case

 Learning Objectives

1. Learn the 5 steps required when completing a case analysis

• Problem statement: Keep it simple and succinct, it should state action required, point out constraints and highlight success measures.
• Situation analysis
• Objectives
• Evaluative of alternatives
• Recommendation

1. Apply these steps to a business marketing case
2. Understand the constant Marketing Information System

The Marketing Information System

• Companies should be engaged in a constant examination and understanding their internal and external environment to identify and anticipate potential problems before they arise and also make adapted changes to take advantage of trends in the market before competitors and to avoid or fix problems.
• You can think of your Marketing Information System like this.

[pic 1]

• If you are constantly keeping an eye on the market, collecting data, developing insights, and disseminating findings than your business will be more responsive to any problem.

Steps of completing a Marketing Case

        (or just identifying and solving business problems in general)

Step 1: Problem Statement

• A solid and simple problem statement makes the rest of the case analysis easier

• It will help you determine what information is relevant when analyzing the case.
• There is usually a lot of irrelevant information in cases (and in life), so try to determine your problem from within all this irrelevant information.

• Think 🡪 K.I.S.S “Keep It Simple, Stupid!”

Step 2: Situation Analysis

When analyzing a business case or current situation of your business, there are a bunch of different analysis tools and techniques.  Too many to discuss all in class.  But a complete situation analysis will include a detailed analysis of the internal situation and the external situation.  You can let take the important insights from these analyses and summarize them into a SWOT analysis, which highlights the most important and relevant internal strengths and weakness, and external opportunities and threats.  

• SWOT Analysis

• A summary of the important and relevant pieces of information from your internal and external analysis.  A proper SWOT analysis will not only have the specific point, but also insight for what that means for your business.  
• Strengths:

• What assets or benefits does the company in question have that is specific to them that they can use to their advantage to help solve this problem
• Strengths can be helpful to achieve objectives
• They are internal to the organization

• Weaknesses:  

• What liabilities or disadvantages does the company in question have that is specific to them that may make it difficult to solve this problem
• Weaknesses can be harmful to achieving the objectives
• They are internal to the organization

• Opportunities: 

• What external environmental situations can the company take advantage of.  (*opportunities is something that other companies could potentially take advantage of also and are not specific to the specific company in question)
• Opportunities can be helpful to achieve objectives
• They are external to the organization and stem from the environment

• Threats: 

• What external environmental situations may hinder the company in solving their problem? (*threats are not specific to the company in question and may also impact other companies as well)
• Threats can be harmful to achieving the objectives
• They are external to the organization and stem from the environment

Internal Analysis

Broadly, an internal analysis is determining your business’s strengths and weaknesses.  And there are numerous ways to do this.  I will cover two ways; Value Chain analysis and Benchmarking that work well together.

• Value Chain Analysis

• An analysis of each element of your value-chain and determining areas that are benefiting you (strengths) and areas you can improve on (weaknesses).
• Value chain analysis consists of 9 components; 5 primary activities and 4 supporting activities.
• Optimizing these areas add to the overall margins

• Primary Activities

1. Supply Chain Logistics
2. Manufacturing
3. Marketing Logistics
4. Marketing Communication and Sales
5. Peripheral Services

• Supporting Activities

1. Company Infrastructure
2. Human Resources Management
3. Research and Development
4. Purchasing

• Benchmarking

• Is an ongoing analysis of what other companies are doing in certain areas or even what your own company is doing in other areas.  
• With benchmarking you can compare aspects of your Value Chain Analysis to similar areas in other companies and determine if what you are doing is superior (and is therefore a strength) or if you are under performing in comparison to other companies (weakness).  This helps identify regions of your Value Chain that needs support or improvement as well as areas that are potentially giving you a competitive advantage and therefore you need to protect.

• Marketing Activities Analysis and Core Competencies

• Part of your Value Chain Analysis regarding the specifics of your marketing activities and if you have something that you can do really well and is difficult for competitors to replicate (Core Competencies) or if you need to work on certain things.  The aspects you should think of are

• Product Development Capabilities
• Customer Satisfaction Capabilities
• Brand Equity
• Distribution Networks
• Strategic Partnerships
• Information

• Financial Analysis

• What do you have to work with?  What is your monetary and time constraints
• How much money does it cost to make money?

• What are your fixed costs (rent, utilities, mortgage, salaries)
• What are you variable costs (per unit costs, such as supplies and materials needed to make 1 product)

• Simple Profit Formula

• Profit = [(#units sold) x (price)] – [(#units sold) x (variable costs)] – (Fixed Costs)

• How many units do you need to sell to “Break Even” (make $0 in profit)

• Make Profit=0 in the above formula and solve for (#units sold)

External Analysis        

An analysis of the business environment and their management consequences

• Micro-environment Analysis

• An analysis of what is happening within your specific industry and product category
• Porter’s Five Forces in the Marketing Context

• Threat of Substitute Products

• Are consumers looking for variety?
• Is there little switching costs for consumers?
• Is there little differentiation between substitutes?
• There is a threat if you answer yes to some or all of these 

• Threat of New Entrants

• Is there easy access to distribution channels?
• Do customers have low loyalty to you or current suppliers?
• Is your brand weak?
• Is there a powerful brand who you could foresee offering a similar or substitute item?
• Is there a low need for developing economies of scale or experience?
• Is there low entry capital requirements?
• There is a threat if you answer yes to some or all of these 

• Bargaining Power of Suppliers

• Do you rely heavily on your suppliers?
• Can they dictate the terms?
• Are there only a limited or minimal number of suppliers who can give you what you need?
• Suppliers have power if you answer yes to some or all of these 

• Bargaining Power of Customers and End Users

• Is your product indifferentiable from competitors?
• Are customers price sensitive?
• Do you rely on a low number of high volume sales?
• Are substitute products available
• Do customers have access to information
• Customers have power if you answer yes to some of all of these

•  Competitive Rivalry within an Industry

• The four prior factors feed into the overall competitive rivalry of the industry or product category

• The greater the threats of substitute products, threats of new entry, bargaining power of suppliers, and bargaining power of customers and end users than likely the higher competitive rivalry within the industry

• The greater the current or possible competitive rivalry within an industry than the less attractive competing in that industry is.

• Macro-Environmental Analysis

• An analysis of what is happening externally to your business at a high level, possibly impacting many businesses across many industries.

• Economic Analysis

• Understanding trends and performance of regional, national, and global economic performance
• Understanding trends with Consumers’ purchasing power
• Changes in education
• Government Regulations
• Growth and changes of different countries
• Technological changes and developments

• Changes in People

• Age  and population distribution
• Education
• Income
• Ethnicity
• Religious trends
• Political leanings
• Sociocultural changes

• Changes in Government

• Regime changes
• Legislation

Step 3: Define Objectives

• Now that you have done your internal and external analysis as well as determined your problem, you can create some objectives that you hope to reach with whatever changes or actions you decide to make to help solve the problem.
• Objectives should be S.M.A.R.T

• Specific
• Measurable
• Attainable
• Relevant
• Timely

Step 4: Alternatives and Alternative Evaluations

• Each alternative should be viable and could solve the problem (sometimes alternatives are given in the case)
• Alternatives should be evaluated based on how well they meet the objectives.

Step 5: Recommendation

• Suggest the alternative that best solves your problem.
• Your reason why this recommendation has been choosing is outlined in step 4 when you evaluated the various alternatives.
• Typically, the alternative that meets the most objectives.

Art with impact: non-profit fundraising

Action required:

• Raise funds
• Decisions on a campaign

Constraints:

• Broke af

Success measures:

...