Report on Marketing Audit Analysis Tools for Company X Assignment

Report on Marketing Audit Analysis Tools for Company X Assignment Words: 1822

Title: Report on the most appropriate marketing audit analysis tools for the X Group To: Marketing Director, X Group From: Marketing Consultant Date: January 4th, 2005 Purpose of report The X Group are undertaking a complex marketing audit and require assistance in evaluating the most appropriate analysis tools. This report will endeavour to fulfil the X Group’s requirements by critically explaining the components of micro and macro analysis.

This report will also explain the role of marketing information and research in conducting and analysing the market, and finally critically assess the usefulness of four analysis tools appropriate to X GROUP’s company activities: – PESTEL analysis, SWOT analysis, Gap analysis and Porter’s five force analysis. 1. Background to the X Group The X Group is a fully integrated presentation and communication organisation, designing, creating and producing presentation solutions globally.

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This involves assisting high profile corporate clients to effectively communicate to internal or external audiences, through the use of interactive solutions, incorporating video, events and multimedia. Based in Worcestershire, the company employs a team of 30 and has won several awards for business excellence and innovation. 2. An Overview of Marketing Planning In the words of Dibb, Simkin, Pride and Ferrell (2001), p691 Marketing planning is a systematic process of assessing marketing opportunities and resources, determining marketing objectives and developing thorough plan for implementation and control. 3. The Marketing Audit The marketing audit is an analytical examination and appraisal specifically of a company’s internal (micro) and external (macro) environments and factors that influence business activities; it is a vital part of the marketing planning process as it provides essential analysis to assist with company and marketing decision-making. 4. Micro Analysis Micro analysis looks at a company’s internal operating environment, evaluating what systems and personnel are in place already and what extra resources might be needed.

This analysis is vitally important in order to fully understand the issues that relate specifically to your business. The key factors are ?? Business ?? Competitors ?? Suppliers ?? Customers ?? Stakeholders Each factor can be broken down into multiple issues during a thorough investigation of this environment; this can take a lot of time and resources to complete. However, it’s an extremely useful tool for spotting strengths and weaknesses within a company that may be exploited, or which must be addressed and improved. 5. Macro Analysis

Macro analysis looks at the external business environment and influencers, providing the company with opportunities ‘for’ and threats ‘against’ success. Various models exist, which provide a structure to work within i. e. PESTEL, which is explained further on in this report. This analysis covers the political and legal environment, key economic factors, social and cultural issues, technological evolution and ecological or environmental factors – all influence the way business can be done, either posing a threat to be addressed and action taken, or presenting an opportunity to be exploited.

Macro analysis is extremely important to any marketing audit no matter how simple or complex. Without finding out about what is going outside the four walls of a company, marketing and corporate decisions will be made blind and consequences could be catastrophic. Changes within this environment happen frequently and it may be difficult to keep up with / find out about them all. This level of research may require assistance from an external research agency, which can cost in time and money but may be vital to the overall activity. 6.

Role of Marketing Information and Research The role of marketing information is vital in conducting and analysing the market. In order for a company’s marketing plan to be implemented effectively, and a marketing orientated and customer focused approach to decision making taken, it should first find out as much information as possible about its customers and markets, identifying their needs, wants, characteristics, buying power and willingness to buy. Without this, decisions are relatively uninformed, posing a serious risk to the business.

Marketing research can determine things such as economic growth prospects in the external environment, pricing and cost structures of competitors, customer responses to new services, channels of distribution for the marketing mix and sales trends by region to name a few. Marketing research is vital to not only finding out about the environment and the customers, but also the necessary changes that might be required to the marketing mix following analysis of the research information.

A company may also want to make decisions about future plans such as international growth, new market opportunities and new technologies, and these decisions need to be well informed, hence the need for accurate and targeted information. 7. Appropriate Analysis Tools The following analysis tools are utilised during a marketing audit: i) PESTEL Analysis The PESTEL analysis tool is a valuable framework for identifying opportunities and threats in the macro (external) environment. It works through the various components of the macro environment and prompts the company to look at the specific areas in depth.

This analysis tool is extremely important to any marketing audit, simple or complex, as it drives the company to investigate what factors may help or impede them to carry out business and marketing activities. An example of PESTEL analysis is shown below, using one of the X Group’s services to illustrate its usefulness. “X GROUP are planning to launch a new range of Video Production services into the market. ” External Environment Examples of factors specific to X GROUP Affects: Political 1. Regulatory bodies impact on filming industry 2.

War / Terrorism affect views on travelling to events ??? alternative is video communication 3. Laws / costs when transporting video equipment abroad Significant impact on X GROUP’s marketing, will affect profitability Economical 1. Customers’ desire to spend on video production affected by state of economy 2. X GROUP’s borrowing ability to invest in video production affected by interest rates Affect X GROUP’s ability to achieve high profits and performance Social 1. Language barriers / cultural differences when filming on location / abroad 2.

Perceptions of X GROUP’s values Affect how X GROUP carry out their service. Technological 1. New advanced filming / editing equipment ??? widely available 2. Development of the Internet / broadband / mobile phone – better transference of data direct to customer 3. Laptops / mobile Internet allowing flexibility for viewing and selling video production. Cost of keeping up to date can be high, but so can the rewards. Ecological 1. Global warming & diminishing natural resources could affect future travel 2. Green’ movement activists may influence more changes in law regarding business waste and pollution issues Affect the way X GROUP does business and the materials and processes used Legal 1. Copyright issues with music, graphics and scripts Can result in profit reduction / legal action In summary, PESTEL analysis is vital to any marketing audit due to the wide scope of influential issues it covers. ii) SWOT Analysis SWOT analysis is extremely useful as it draws together key information resulting from the macro and micro analysis, flagging up strengths, weaknesses, opportunities and threats identified.

Also, the grid style as shown below, prompts the marketer to follow the information through and deliberate actions required. By taking corrective action, current situations can be improved and plans put into place for on-going continuous change. S ??? Strengths W – Weaknesses Identified from micro (internal) environment Assess which can be exploited Identified from micro (internal) environment Address the changes required to turn these into strengths O ??? Opportunities T ??? Threats Identified from macro (external) environment Assess which can be exploited

Identified from macro (external) environment Address the changes required to turn these into opportunities Using the example of X GROUP’s new range of video production services again, the micro analysis may have identified that there are a number of employees who are not trained on the new advanced equipment, which is a weakness. By identifying this issue, the grid prompts X GROUP to realise that a programme of training courses is required to turn the situation into a strength. . To summarise, this analysis tool is extremely useful in identifying areas hat are already strong and can be exploited to the company’s advantage, and those areas that require immediate or long-term action to improve them. iii) Gap Analysis Gap analysis is an ideal tool to use during strategy development as it is designed to show ‘where X GROUP is now’ and ‘where X GROUP want to be’. Gaps discovered in this way can be closed by skilful and creative development of a competitive marketing strategy. One strategy that X GROUP could consider is Porter’s three generic strategies (1980); these are cost leaders, differentiation and focus strategies, as detailed in appendix 1.

Information cited in Beamish, Ashford, (2004) p38. In summary, gap analysis gives a clear picture of what is actually happening and the possible gap that exists between there and where X GROUP would like to be. It can also help X GROUP to realise their future direction if nothing is done to close the gap, prompting action to be taken. iv) Porter’s Five Force Analysis X GROUP’s objectives will be related to profit margin, market share and different growth strategies.

So that X GROUP can define the future of both the corporate and marketing strategy, it’s important to take into account the nature of the driving forces within the marketplace, in order to fully understand what is shaping the industry. Also, when developing a sustainable competitive advantage, X GROUP needs to understand its competitors and the nature of the competitive environment. Porter’s five force analysis, has five components to be considered in order to understand the potential threats within the marketplace or the industry’s potential profit.

It provides a framework to investigate the competitive environment through a number of micro factors, and enables industry attractiveness to be measured and complexity of operating markets understood ??? making it exceptionally useful. Porter’s framework is an opportunity for X GROUP to understand the holistic range of driving forces in the micro environment, which can be linked to macro analysis and enables a full SWOT analysis to be developed. All of this aids key marketing decision making and strategy development 8. Conclusion

In conclusion to my report, micro and macro analysis are vital to the marketing audit to enable X GROUP to make informed marketing and corporate decisions. Marketing information and research is also invaluable to the process as it provides relevant information on what is happening in a company’s internal and external environments. All of the four analysis tools discussed will help X GROUP in different areas of the marketing audit, finding out about environments, key influencers, and prompting actions to be taken to improve situations ??? each tool is important for X GROUP to undertake their complex marketing audit.

Word Count: 1594 9. References Dibb, S. Simkin, L. Pride, W. M. & Ferrell, O. C. (2001), Marketing Concepts and Strategies, Boston, USA: Houghton Mifflin, Fourth edition, Page 691 Beamish, K. & Ashford, R. (2004), Marketing Planning, Oxford, England: Butterworth-Heinemann, First edition. , p38 M. E. Porter, Competitive Strategy, The Free Press, 1980: ?? The Free Press/Macillan

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Report on Marketing Audit Analysis Tools for Company X Assignment. (2020, Aug 11). Retrieved November 27, 2020, from https://anyassignment.com/art/report-on-marketing-audit-analysis-tools-for-company-x-assignment-30530/