Chapter 1: Introduction
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Chapter 1: Introduction A SWOT analysis is a structured planning method used to evaluate the strengths, weaknesses, opportunities and threats involved in a project or in a business venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieve that objective. Some authors credit SWOT toAlbert Humphrey, who led a convention at the Stanford Research Institute (now SRI International) in the 1960s and 1970s using data from Fortune 500 companies. However, Humphrey himself does not claim the creation of SWOT, and the origins remain obscure. The degree to which the internal environment of the firm matches with the external environment is expressed by the concept of strategic fit. Strengths: characteristics of the business or project that give it an advantage over others. Weaknesses: characteristics that place the business or project at a disadvantage relative to others Opportunities: elements that the project could exploit to its advantage Threats: elements in the environment that could cause trouble for the business or project. SWOT analysis aims to identify the key internal and external factors seen as important to achieving an objective. SWOT analysis groups key pieces of information into two main categories: 1. internal factors – the strengths and weaknesses internal to the organization 2. external factors – the opportunities and threats presented by the environment external to the organization Analysis may view the internal factors as strengths or as weaknesses depending upon their effect on the organization's objectives. What may represent strengths with respect to one objective may be weaknesses (distractions, competition) for another objective. The factors may include all of the 4Ps; as well as personnel, finance, manufacturing capabilities, and so on. The external factors may include macroeconomic matters, technological change, legislation, and sociocultural changes, as well as changes in the marketplace or in competitive position. The results are often presented in the form of a matrix. SWOT analysis is just one method of categorization and has its own weaknesses. For example, it may tend to persuade its users to compile lists rather than to think about actual important factors in achieving objectives. It also presents the resulting lists uncritically and without clear prioritization so that, for example, weak opportunities may appear to balance strong threats. It is prudent not to eliminate any candidate SWOT entry too quickly. The importance of individual SWOTs will be revealed by the value of the strategies they generate. A SWOT item that produces valuable strategies is important. A SWOT item that generates no strategies is not important. One way of utilizing SWOT is matching and converting. Matching is used to find competitive advantage by matching the strengths to opportunities. Converting is to apply conversion strategies to convert weaknesses or threats into strengths or opportunities. An example of conversion strategy is to find new markets. If the threats or weaknesses cannot be converted, a company should try to minimize or avoid them. "This analysis leads to business awareness and is the cornerstone of any successful strategic plan," said Bonnie Taylor, vice president of strategic marketing at CCS Innovations. "It is impossible to accurately map out a small business's future without first evaluating it from all angles, which includes an exhaustive look at all internal and external resources and threats. A SWOT accomplishes this in four straight-forward steps that even rookie business owners can understand and embrace." Niki Pfieffer, founder of Niki Pfieffer Designs, noted that many small business owners don't know how to properly use a SWOT analysis to guide their business. Matching and Converting One way of utilizing SWOT is matching and converting. Matching is used to find competitive advantage by matching the strengths to opportunities. Converting is to apply conversion strategies to convert weaknesses or threats into strengths or opportunities. An example of conversion strategy is to find new markets. If the threats or weaknesses cannot be converted, a company should try to minimize or avoid them. Objectives of the SWOT Analysis In Jumbo Kings case the advertising objectives are mainly twofold - building the category need for snacks as an alternative for proper food and building brand equity for Jumbo King. The Indian fast food category needs to be popularized among the target audience as a convenient way of having a hygienic snack when in a hurry. In what is largely an unbranded market as of now, Jumbo King has a unique opportunity to create a brand identity for itself similar to that of McDonalds in the US. Creating such an identity would entail associating the brand with local flavor, fast service, convenience and travel. As an example of a brand identity creation strategy, one can consider suitable modifications to the companys logo to make it look more stylish and convey the impression of speed, while retaining a number of elements manifest in the old logo. Another exercise can involve developing brand taglines to be delivered in regional languages (Marathi is the obvious choice in the present case). Catching the attention of commuters, most of who are in a hurry, is not an easy task and therefore identifying bottlenecks (which require commuters to wait e.g. elevators) where the message can be effectively delivered is crucial. Even in modes of delivery both traditional and nontraditional modes of advertising should be employed. Traditional Advertising For a brand that is small, largely regional and warrants a small budget, the most effective means of reaching out to the public is through the print medium. Small billboards, placed in strategic locations where commuters wait (like on buses, trains, ticket counters, petrol pumps etc), can be most effective in pushing the consumer towards an impulse purchase. Slogans like "When your tank is full, why let your stomach go empty?" and "The law says you can’t drink and drive, but who ever said anything about eating?" can effectively be used by Jumbo King at petrol pumps and traffic signals. Again catchy statements like "Isn’t it time for your stomach to get a top-up too?" can be used in front of mobile shops and general stores. Bigger billboards and posters at railways stations and on trains and buses reinforce brand identity. They can appeal at an emotional level to the consumer regarding the spirit of the city they live in and tie that in to the brand. A possible campaign of this type for Jumbo King will emphasize the intimate relation of the food chain with Mumbai city and its people and will aim at binding the spirit of living in Mumbai with the brand that signifies speed, affordability and pride in eating a local snack. Non-Traditional Modes of Advertising Indian snacks are not exactly renowned for health and hygiene. Since Jumbo King belongs to this category of food items, PR campaigns could be an effective tool in dispelling any such concerns that a consumer may have. Newspapers, magazine articles and press releases talking about the quality of food at Jumbo King and its stringent adherence to hygienic standards can go a long way in changing customer perceptions about the category and the brand. PR campaigns talking about the entrepreneurial stories of the young founders of initiatives like Jumbo King can give a lot of publicity to the concerned brand and this comes at no cost. Other innovative means of reaching the consumers like printing out city maps or train/bus timetables (with information on Jumbo Kings outlets) for commuters and distributing them can be employed. Being a low involvement product with a target customer group that is mostly on the go, the challenges of reaching this segment are many. Designing a really great advertisement and putting it on TV or a big billboard on the road in all probability will not translate into sales. Creative advertisements must be complemented with equally creative ways of placing these advertisements so that they are noticed. Jumbo King is about speed and convenience and hence locations and objects which are associated with these attributes (like bus-train time tables, guides, road signs etc) should be used to integrate ideas with their execution as a part of the Jumbo King identity. Media Planning - Showing the World Both the traditional as well as non-traditional strategies for advertising offer great opportunities for creative marketers to show off their skills in convincing people to buy their products. Preparing a catchy and innovative advertising campaign is no easy task and a well prepared creative plan can work wonders for the company and its products. But that is just one side of the story. A marketer may have done an excellent job in identifying the target audience and preparing an excellent commercial for them, but what use is all that if it doesn’t reach them? That is where an effective media strategy comes into the picture. One needs not just be creative and different in terms of preparing ads, but should also be adept at executing those well prepared ads to perfection. Media planning is all about determining the media habits of consumers in the target group and formulating how this knowledge can be exploited to reach the target group effectively. For a budget conscious brand like Jumbo King, it becomes even more important to have a judicious mix of media since targeting all media channels (TV, print, radio etc) can be prohibitively expensive. Different media channels can have different impact on the customers at different costs Print Media This can be a very effective medium for the franchise since it has the maximum reach among the target audience.