West, Ford, & Ibrahim
Strategic Marketing, 3rd edition
Chapter 3: Environmental and
internal analysis: market
information and intelligence
© Douglas West, John Ford, and Essam Ibrahim, 2015. All rights reserved.
Structure
A. INTRODUCTION
1. Overview and Strategy Blueprint
2. Marketing Strategy: Analysis &
Perspectives
C. WHERE DO WE WANT TO BE?
B. WHERE ARE WE NOW?
3. Environmental & Internal Analysis:
Market Information & Intelligence
4. Strategic Marketing Decisions,
Choices & Mistakes
5. Segmentation, Targeting
& Positioning Strategies
6. Branding Strategies
7. Relational & Sustainability
Strategies
D. HOW WILL WE GET THERE?
E. DID WE GET THERE?
14. Strategy Implementation, Control
& Metrics
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
8. Product Innovation & Development
Strategies
9. Service Marketing Strategies
10. Pricing & Distribution Strategies
11. Marketing Communications Strategies
12. International Marketing Strategies
13. Social and Ethical Strategies
Learning Objectives
 To review the three areas of the Strategic Marketing
Management Process (SMM)
 To define the marketing environment and its components
 To review the analytical models/frameworks that can be
used in the external strategic analysis stage
 To outline the purpose of internal analysis and review
tools/frameworks to use in organisational analysis
 To outline the outcome of the strategic marketing analysis
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Strategic analysis is concerned with
understanding the strategic position of the
organisation in terms of its external
environment, internal resources and
competencies, and the expectations and
influence of stakeholders
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Strategic marketing management
The marketing strategy development process
aims to answer a complete set of questions:




Where are we now?
Where we want to be?
How will we get there?
Did we get there?
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Where are we now?
Environmental and Internal Analysis

What are the major trends and probable changes in the
marketing environment?

Who are the main competitors, and how we can differentiate our
offerings from competition?

Who are the target customers, and what are their needs?

What competitive advantages and core competences do the
organisation have? Can we sustain it?
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
The marketing environment
Macroenvironment
Economic
Political/Legal
Microenvironment
Suppliers
Customers
Company
Distributors
Competitors
Social
Environment
Technological
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Macro (remote) environment: PESTLE
model
PESTLE:
Political Factors
Economic Factors
Socio-cultural Factors
Technological Factors
Legal Factors
Environment Factors
A framework that assists in analyzing the external (remote)
environment and identifying the existing opportunities & threats
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Micro (competitive) environment: 5 forces model
The purpose:
 Identify and analyse the key external forces that
affect the organisation ability in achieving its goals
and objectives
 Assess the power of each factor and the likely
response
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Porter’s five forces for competitive analysis
POTENTIAL ENTRANTS
Threat of entrants
SUPPLIERS
Bargaining power
Competitive
Rivalry
BUYERS
Bargaining power
Threat of substitutes
SUBSTITUTES
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Analysis of internal environment
The Purpose:
• Appraise/audit the organisation resources and
capabilities,
• Assess the organisation competitive advantages
• Identify the organisation major strengths and weakness
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Analysis of internal environment
Two models to use:
1.
Resource audit
 financial resources,
 human resources,
 physical resources,
 intangible resources
2.
Porter’s Value Chain Model:
Help analysing Firm’s Competitive Advantage and Core
Competencies
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Value chain analysis:
Identifying Competitive Advantage
Competitive advantage will arise through:
– Providing buyer value comparable to competitors but
performing value chain activities more efficiently – cost
based advantage
and / or
– Performing value chain activities in unique ways that create
greater buyer value than competitors and hence command a
premium price – differentiation based advantage
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Strategic fit
‘Strategic Fit’ is the effective match and
management of the environmental opportunities
and threats while taking into account the
organisation strengths and weaknesses
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
SWOT analysis
Integrates the internal and external environmental analysis
 Not just a list of SWOT variables!

SWOT/TOWS Matrix can be helpful

SWOT/TOWS analysis is the alternative ways in which an
organisation can use its specific strengths to capitalise on
opportunities or to minimise threats and invest in available
opportunities to overcome its weaknesses
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
SWOT (TOWS) matrix
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition
Conclusion
•
Strategic marketing management (SMM) process covers 3 areas; strategic
analysis, strategic choice and strategy implementation
•
Strategic analysis involves the collection and analysis of relevant types of
information about the environmental forces and trends, and organisational
resources and capabilities
•
External (macro) environment can be analysed using PESTLE model, while
the micro environment could be examined using Porter Five forces model.
The internal environment can be assessed using various models, most
notably is the ‘value chain’ approach
•
The effectiveness of any marketing intelligence system is dependent on the
frequency of collecting, interpreting, and disseminating the information
required about the marketing environment & competition
•
SWOT analysis is an important foundation for producing realistic and
meaningful strategic recommendations for the firm’s future directions
West, Ford, & Ibrahim: Strategic Marketing, 3rd edition