The situation review or analysis is best known as a marketing audit of the current effectiveness of marketing activities within a company together with environmental factors outside the company that should govern the way the strategy is developed. These principles can be readily applied to review online marketing effectiveness and internal capabilities. Strategic analysis or situation analysis involves review of:
• the internal capabilities, resources and processes of the company and a review of its activity in the marketplace;
• the immediate competitive environment (micro-environment) including customer demand and behaviour, competitor activity, marketplace structure and relationships with suppliers and partners. These micro-environment factors were reviewed in Chapter 2 and are not considered in detail in this chapter;
• the wider environment (macro-environment) in which a company operates, which includes economic development and regulation by governments in the form of law and taxes together with social and ethical constraints such as the demand for privacy. These macro-environment factors including the social, legal, economic and political factors were reviewed in Chapter 3 and are not considered further in this chapter.
Now complete Activity 4.1, which illustrates the type of analysis that needs to be performed for an Internet marketing situation analysis.
Situation analysis for an e-commerce operation
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